Controlling Worker’s Compensation Costs

How To Set Up Employee Insurance Plan

Depending on your industry, workplace injuries might occur frequently or be scarce. Regardless of the frequency of claims, there are some things an employer can do to help manage the cost of claims. There are MANY different factors that can affect the cost of the claim. They are:

  • The insurance company (do they help you manage the claim, or just pay bills?)
  • The claims adjuster (the contact person at the insurance company)
  • The administrator of the claim (the employee within your organization that manages the claim or the TPA you hire to manage your claims)
  • The doctor treating the employee (do they understand a “back to work” program, are they in-network, are they an occupational health doctor?)
  • The employee (are they eager to get back to work, do they want to just sit at home?)
  • An attorney (has the employee retained an attorney?)
  • The actual injury (major, minor, or just first aid?)
  • OSHA (is this reportable, are we getting investigated?)

Experiencing a workplace injury can be frightening for co-workers as well as confusing for administrators. For the process to go smoothly and to avoid costly mistakes, there are a few things that employers can do now to prepare for a potential injury. Establishing these practices after an injury has already occurred can be costly.

The first step is to establish a relationship with the worker’s compensation insurance carrier. Create a contact with a phone number, email address, and fax number. Let the insurance company know who you are, your role within the company, and what you will expect if/when an injury occurs. Let them know that you will be heavily involved with communication and getting the employee back to work. Ask about the network of providers that they work with, the best clinics to visit in the area, and any follow up information. If you’re not familiar with reporting worker’s comp claims, ask for some training for yourself. It’s also wise to know your individual state reporting requirements, (as well as OSHA reporting requirements). Each state has a different statute of limitations when it comes to workplace reporting.

Second, train your employees not only on safety, but on injury reporting as well. I cannot stress this step enough. Supervisors AND employees need to know who to call when an injury occurs, where to go for treatment, whether a post-accident drug test is required, and any in-house paperwork that might be required. Without this training, employees might go weeks before they alert someone that they had an injury. Timely reporting can mean the difference between a claim with medical only treatment vs. a claim with paying indemnity (wages). The reason this is important is that it can have a major effect on the E-mod of the company which directly correlates to the premium dollars the company pays for insurance.

The last thing you can do to prepare for a claim is to establish a return-to-work program. Return-to-work programs consist of job duties and functions that an employee can perform while they have restrictions (if their original job does not meet their restrictions from the doctor). If you cannot provide “light or modified” work for an employee while they’re on restriction, the insurance company will pay a percentage of the employee’s gross weekly wage for the employee to stay home. The longer an injured employee is absent from the workplace, the higher the costs will be to you and your carrier, as well as a rising e-mod. Additional costs include lost productivity, overtime for other employees, decreased morale among the workforce, increased insurance premiums, and the costs of hiring and training a new employee if you must replace the injured employee. Having a fair, consistent return-to-work program as a part of your employee benefit package is beneficial for everyone involved.

Un-managed worker’s comp claims can be very costly and confusing. Here at Solution Services, we take care of everything regarding injuries and help you learn how to set an employee insurance plan so you can focus on your business, instead of those un-managed worker’s comp claims. Give us a call today and see how we can help!