Risk & Insurance

July 24, 2013

Managing workers' compensation claims imposes a constant test of personal judgment, team skills and support systems. But the conventional image of a person at the center of this function, the claims adjuster, portrays a rules-bound, beleaguered worker of marginal professional stature.

This role or image conflict seems ever more peculiar today as technology empowers claims adjusters to better predict, coordinate and affect claims results. The professional status of adjusters should be higher than it is.

I discussed the traits of a top claims worker with Wayne Salen, the leader of the claims document team of the Standards and Practices Committee of the Risk & Insurance Management Society. Salen is former director of risk management at Labor Finders International, Inc. The temporary staffing firm fields some 16,000 workers a day, for mostly average or above-average injury risk worksites. Salen has contracted with a range of claims vendors over the years.

Our phone call revealed demarcations between professional and less-than-professional claims environments. Claims executives behave in ways that can impact the environment, and their staff's careers.

One of those factors is measurement agility. It is remarkable how one's professional image can grow by adding nuance in analysis while making the summary clearer.Herein is a lesson for claims leaders.

Typically, TPAs when pitching business, talk about staffing targets, such as 100 open lost-time claims per adjuster. The TPA and the prospect implicitly agree that the ratio reliably compares claims organizations.

But this doesn't make sense, given the huge variances in technology capability and in how claims staffs use nurses, claims intake, and other resources. Some claims systems, Salen noted, are so proficient that "You can really pare the human element down with the system making decisions." When he evaluates a TPA, he focuses first on service design and postpones talking about the staffing ratio until the end.

In another over-used measurement practice, TPAs tend to accept from discount-driven medical provider networks "savings" reports. But medical savings and reduction in duration of disability are more closely related to the quality of the medical provider, not to discounts. These discount "savings" reports are bad analysis driving out good analysis.The claims leader who is reluctant to address quality of provider sends a signal about the professionalism of her or his enterprise.

Another factor is adjuster discretion. Salen took pains to praise the "empowerment" of the individual adjuster, who does not always have to get approvals from layers of supervisors to depart from guidelines. For instance, an experienced adjuster should be able to adjust a reserve as part of a strategy to work the claim to a desired end.

Attention to the customer is another factor. Employers want to learn about claims in an employer-focused way.

One of the big changes in the past five or 10 years, Salen said, is the ability of claims systems to automatically produce for an employer's operating units clear reports. A good summary delivered without lag time is invaluable, yet he noted that only a couple of TPAs and insurers produce these automatically, without having to be asked.

Each of the above factors characterize a claims organization's internal proficiency and its capacity to anticipate the external world. That's professionalism, viewed inside and out.

Workers compensation claims adjustors handle a tremendous amount of claims at a time. The number of claims handled by a single adjustor can exceed hundreds of claims at a given time. Like with any job, if you have too much on your plate, it's hard to be keep a good handle on things. Certainly many adjustors are having a hard time giving the proper attention to each individual claim file and as a result many claims are neglected, leading to significant overcharges to an employer's workers compensation policy. Apex Services reviews your current and prior workers compensation policies on a contingency basis to identify these errors and recover refunds for employers. Either we'll get you a refund from your insurance companies or you'll know that you haven't been overcharged. Apex Services workers compensation premium recovery service is a win-win!