|
NEWSLETTERS
NEWSLETTERS
|
In this issue
|
| • |
Common questions about Return-to-Work programs |
| • |
Implementation of comprehensive Workers' Comp program saves auto dealer $2 million in first year |
| • |
Out of sight, out of mind
What happens to employees when they are out of work?
|
|
Common questions about Return-to-Work programs
|
Q."I'm reluctant to start a RTW program. What if the employee gets hurt again?"
A. Yes that is a risk. Part of the job is to manage risk. If they don't come back and get out of the social context, there is a high probability that they will get worse. We need to determine what is the greater risk.
Q."What should I do if the employee refuses the modified duty?"
A. The work must be meaningful and not demeaning to the employee. If the job offer is consistent with the physician's instructions and the employee refuses, in most cases you can cut off the indemnity benefits.
Q."Can I reduce the employee's pay?"
A. While the short answer is "yes," the best results come from employers who do not reduce the pay. Employee and employer should be on the same page about the expected duration of the modified duty. If it is short-term, do not reduce the pay. This could have a negative effect on the employee's attitude and if reduced too much could mean that some indemnity would have to be paid.
|
Taking the creative route to save a contract
|
It's a well-known fact that a company's Experience Mod has an effect on its bottom line because of the additional Workers' Comp costs that result from it. However, sometimes a high Experience Mod can also directly affect how you do business.
A HVAC parts and service company was in danger of losing its largest account. In the interest of promoting on-site job safety, the customer, one of the country's largest paper manufacturers, had established a policy that it would not do business with any vendor whose Experience Mod was greater than 1.0.
Since the HVAC parts and service company could ill afford to lose their largest customer, they turned to a Certified WorkComp Advisor (CWCA) for assistance. In evaluating the situation, the CWCA found that the paper company only did business with the HVAC Company's Service Department. Therefore, she broke apart the Experience Mod by departments such as electrical, residential, plumbing and service and was able to show how each department affected the Mod and what the Mod would be for each department individually.
This revealed that much of the basis for the Mod was from the company's Residential Plumbing division, not the industrial service division that did business with the paper company. In fact, the Service Department did not have a single claim that contributed to the Mod, which means as a stand-alone company that department would have an Experience Mod well below 1.0.
The department's sub-1.0 Experience Mod satisfied the paper manufacturer and enabled the HVAC Company to keep the contract. It also inspired the HVAC Company to bring in the CWCA to teach all of his employees about their roles in controlling Workers' Compensation costs.
|
|
Implementation of comprehensive Workers' Comp program saves auto dealer $2 million in first year
|
Insured:
The chain of full-service automobile dealerships employs more than 500 people divided into three work classes - dealer, auto sales people and clerical. The company did more than $250 million in business in 2005.
Situation:
The frequency and severity of claims being incurred by the employer were staggering. It had experienced more than 100 claims for each of the previous three years. The costs of those claims averaged more than $700,000 per year and the most recent year they topped $900,000. These numbers had already driven up the employer's Experience Mod to 1.3 - more than twice the minimum level of 0.65- and was about to push up the mod for the coming renewal year by another 10%.
Assessment:
Certified WorkComp Advisors (CWCAs) reviewed the business prior to the employer's latest renewal. They found much disarray in its personnel plans and some aspects - such as defined return to work or injury-reporting systems - were non-existent. Furthermore the employer relied upon the carrier to provide on-the-job safety plans, which amounted to employing an outside safety consultant that partially implemented OSHA regulations, but not much more.
Solution:
The CWCAs in concert with a risk management team put a business plan together that included, among other things, detailed procedures for reporting injuries, specifications to whom the employees should go for initial medical evaluations and identification of "light duty" jobs. The plan also included a very comprehensive safety program.
Result:
Because the plan showed the promise of significantly decreased claim frequency, the carrier agreed to work with the employer and decreased the renewal offer for last year by $950,000. In the first year, the number of claims dropped nearly 70% to only 38 with the overall cost of claims plummeting to $128,000. And in the first eight months of the second year, 12 claims have been filed with no lost workdays - a first for any eight-month period for this employer. The employer's Experience Mod for this year has also dropped by 25% and this year's premium dropped by over $800,000. In all, the total savings realized by the employer to date has topped $2 million.
|
|
Out of sight, out of mind
What happens to employees when they are out of work?
|
Implementing a Return-To-Work (RTW) program often meets with resistance. "There are no light duty jobs, it's too costly to implement, the employee will hurt himself again, the employee will refuse the offer or be disgruntled" are just some of the many objections employers raise about RTW programs.
It's easier to let the employee stay home - out of sight, out of mind. Yet, it is impossible to drive down Workers' Comp costs without a RTW program. As an employer, you are paying the cost of having your employee stay at home. It impacts your Experience Mod. To understand just how much, take an existing claim, determine how much was paid in indemnity, take out the indemnity and see the effect it will have on your Mod. The results can be startling.
Consider also the effect on your employee. Very quickly, the employee can get out of the normal cycle of work, change habits, and lose motivation. He or she fills their life with other duties - picking up the kids, running errands, cooking, etc. The employee develops a disability attitude, gets worse, depression and frustration often set in and the employee heads off to an attorney, driving up your costs even further.
Being out of work is a health hazard. Studies show that those employees who stay out of work get far more medical treatment than those who return to work. They also reveal that 95% of employees should be back to work by the fourth day and if they are out for more than 12 weeks, there is only a 50-50 chance they will return to work.
According to the American Medical Association, work is therapy. People get better faster when they are moving around and when they feel productive and good about themselves. A cable company had an installer who was injured on the job. He was extremely talented and did the job more efficiently than anyone else on staff. The company decided to have him accompany other employees on installations and lend his expertise. This not only strengthened the company's capabilities, but also was a boost to the employee's self-esteem and commitment.
RTW programs not only make economic sense but are also a strong statement to your workers that they are valued. Finding good employees is a challenge for most employers. RTW is a way of keeping them.
Four key components of successful Return-to-Work
1. Modified Duties
Develop a list of modified duties - meaningful work that needs to be done -and keep on file. This should not be done at the time of the injury, but reviewed, modified and added to over time. Supervisors play a key role in developing the list. For example, a construction contractor's RTW program includes security work, safety inspections, training in the field and inventory control.
2. Supervisor Training
One of the biggest indicators if a claim will go bad is the relationship between the employee and supervisor. Knowing how to treat an injured employee is not as obvious as one might think. Pressures to get the job done when short-staffed can convey a message of anger rather than encouragement. Supervisors must understand that RTW has a positive effect on the bottom. Successful employers hold supervisors accountable by tying in bonuses and performance reviews.
3. Communication with Employees
Share information about the RTW program with employees at the time of hiring, during staff meetings and throughout the course of employment. Be sure they understand that the goal is to facilitate recovery - RTW is transitional only and not intended to be permanent. When an injured employee returns to work have them sign a return to work agreement. This agreement should clearly delineate the work restrictions that have been specified by the physician and state that the employee is not required, nor expected to perform any tasks beyond those restrictions. Give some idea of how long you expect the employee to be in the position. Establish clear expectations. An analogy many can understand is that of a baseball pitcher. After the injury is treated, he returns to the minor leagues for rehabilitation. There is a clear idea as to the steps he must take to return to the rotation in the major leagues.
4. Work with the treating physician
Doctors tend to trust employers more than they do insurance carriers. Send an introductory letter that provides information to help doctors understand the employee's regular job, the return to work program, and available alternative assignments. Adopt the approach - "Tell us what they can and cannot do and we will accommodate." With the exception of the following conditions, an employee should return to work:
Medication that impairs the ability to work
|
|
Previous Newsletters
May-2009
Apr-2009
Mar-2009
Feb-2009
Jan-2009
Dec-2008
Nov-2008
Oct-2008
Sep-2008
Aug-2008
Jul-2008
Jun-2008
May-2008
Apr-2008
Mar-2008
Feb-2008
Jan-2008
Dec-2007
Nov-2007
Oct-2007
Sep-2007
Aug-2007
Jul-2007
Jun-2007
May-2007
Apr-2007
Mar-2007
Feb-2007
Jan-2007
Dec-2006
Nov-2006
Oct-2006
Sep-2006
Aug-2006
Jul-2006
Jun-2006
May-2006
Apr-2006
Mar-2006
Feb-2006
Jan-2006
|
