Neither Good Luck nor Good Vendor
Thursday, August 27, 2015 | 361 | 0 | min read
The work comp service industry would have employers believe that the best workers’ comp outcomes require services of the “best” insurer, third-party administrator, preferred provider organization and other vendors. Further, that the “best” process hinges primarily on reporting claims with limited-to-no lag time.
Why is this wrong? Because the most powerful forces dictating claim outcomes have nothing to do with vendors or employer-to-TPA lag time and are summed up as follows:
1) Most every WC claim that turns out “good” involves a motivated employee with the appropriate attitude who respects their job.
2) Most every WC claim that turns out “bad” involves an unmotivated employee with an inappropriate attitude who lacks respect for their job.
Vendors do have influence, but this is not good news as said influence hangs precariously in but one dangerous direction, summed up as follows:
1) No vendor can make positive an employee’s poor motivation, bad attitude and lack of respect.
2) An inept vendor can make negative and squander an employee’s otherwise great motivation, attitude and respect, thereby creating a “bad” claim outcome.
What about lag-time? The industry has us believe lower reporting lag is at the crux of claim success. This is a statistic TPAs like to throw at employers. Employee-to-employer lag time should absolutely be as close to zero as possible. However, the secondary lag of employer-to-TPA is proportionally less important to the degree any employer activates a high-touch early intervention program aimed at first-aid status and positioning for RTW while decreasing claim reports and OSHA log entries. In these programs, an employer-to-claims lag of up to seven days does not limit any better influence than the routine 3-point adjuster contact might have provided.
So, as far as vendor influence, my conclusion is decidedly stark: The best service providers are the ones least likely to anger good employees. This is their only real limit of influence. Every other attempt at differentiation is practically meaningless and nonconsequential from one vendor to the next. Every other assertion of greater ability to influence outcomes is simply not true.
Quick Tip: How To Prevent Your TPA From Frustrating Otherwise Good Employees
1) Require that adjusters return employee calls and emails within 24 hours.
2) Require that mileage reimbursements are paid within 5 days.
3) Maintain a zero tolerance for “past-due” medical notices to employees for covered medical bills.
4) Maintain a zero tolerance for delayed or refused appointments with specialists, PT, diagnostics and others. All covered referrals are immediately approved to the providers’ satisfaction. (Note: in the current climate more providers require direct approval from the adjuster.)
5) Include compliance with the above 1-4 in at-risk fee scenarios.
6) Include the designated employer WC coordinator in all important communication and claim milestones.
7) Respect the employer’s post-loss intervention process and rise to the response-level necessary when presented a full claim package including days of preliminary work.
8) Adopt a “no surprises” pact where the adjuster and employer WC coordinator will immediately alert the other to any indications of employee frustration or negativity aimed at the other or the system in general.
In conclusion, employers must realize that the success of WC programs relies primarily on the mindset and attitude of employees. The respect an employee has for their employer’s WC program is enhanced by employer involvement. Respect is vanquished proportional to how quickly an employee is deferred strictly to the TPA. Vendors alone cannot conjure better claim outcomes.
Barry Thompson is founder and president of Risk Acuity, an employer-consulting firm. This column was reprinted with his permission from the company's Quick Tips blog.