Rising Workers’ Compensation costs are among employers’ greatest concerns, especially as “mega claims”—i.e., claims of $3 million or more—continue to skyrocket.
Obviously, you want your workers to be safe on the job. And in the event an employee is injured on the job, you want your Workers’ Compensation protection to respond.
But you also want that to happen as rarely as possible.
Fortunately, there are steps that you can—and should—take to reduce the risk of workplace accidents, Workers’ Comp claims, and all related costs.
Understanding Workers’ Compensation Claims
While laws regarding Workers’ Compensation benefits vary by state, every state except Texas requires employers to carry mandatory coverage, which typically includes these benefits:
- Medical expenses
- Lost wages
- Permanent disability benefits
- Vocational retraining
- Death benefits
In addition, employers frequently incur these indirect costs:
- Investigation of alleged injuries
- The expense of hiring/training replacement employees
- Safety training/development of new safety practices
- Potentially increased Workers’ Compensation insurance premiums
These all add up quickly!
Best Practices for Handling New Workers’ Compensation Claims
There’s a right way and a wrong way to respond to potential Workers’ Compensation events. Attorneys recommend these employer best practices:
Document Every Workers’ Compensation Incident Immediately
Get a written statement from the employee as soon as possible after an event. Not only will his/her memory be clearer, a worker who hasn’t yet talked to friends and coworkers—or retained an attorney—is more likely to provide a candid account of what actually happened.
Consider Retaining an Independent Accident Investigator
For potentially large Workers’ Compensation claims, an outside expert may be better equipped to interview witnesses, collect statements, handle safety investigations, etc.
Consider Obtaining a Medical Canvass Investigation
If there is reason to suspect an employee may have injured himself before the alleged accident, a trained investigator can canvass local medical providers to determine if he/she has been previously treated for a similar injury.
Obtain Surveillance Video, if Available
If footage of an alleged accident exists, it can be used for comparative purposes against the employees’ version of events.
Choose Your IME Doctor Carefully
Since employers are typically bound to the opinion of their Independent Medical Examination (IME) doctor throughout the case, it’s important to select highly-credible providers. Proactive employers develop a list of trusted IMEs in advance of potential claims as well as procedures for providing IMEs with all needed documentation.
Use a Preferred Provider Program, if Allowed
Some states allow employers to create Preferred Provider Programs (PPP) for Workers’ Compensation medical care, which is helpful in states where employees are given a limited choice of medical providers.
Maintain Open Communication All-Around
Communicate regularly with the injured worker (if he/she is not represented) to stay abreast of treatment plans, return to work, etc. Share all information with your Workers’ Compensation carrier and defense attorney, and conduct quarterly claim reviews with them to keep everyone on point and moving toward resolution.
Best Practices for Preventing Workers’ Compensation Claims
There are also proactive steps employers can take to keep workplace injuries from occurring:
Make Employees Accountable for Good Safety Practices
Develop and communicate specific safety practices employees must follow, and incorporate them into performance reviews, disciplinary policies, and handbook sign-off.
Incentivize Employees to Follow Your Safety Practices
Consider offering employees monetary incentives, such as bonuses and rewards, or sponsoring an enjoyable company activity—a pizza party, anyone?—to celebrate a safe month or quarter.
Encourage Confidentiality Regarding Workers’ Compensation Claims
Workers’ Comp settlements can cause an unfortunate ripple effect, so it’s wise to minimize internal chatter about settled claims.
Develop a Transitional Duty Program
Transitional duty is temporary work offered to inured employees before they’re fully recovered. While it should always comply with employee work restrictions, the goal is to ease the injured worker back into the workforce quickly. Studies show that odds of returning to full employment drop by 50% after a 12-week absence!
Personal protective equipment (PPE) is what workers use to help shield them from potential hazards. It could include respirators, gloves, aprons, fall protection and full body suits, as well as head, eye and foot protection. Making sure workers have the tools they need to stay safe is a vital component of a proper workplace safety program and a way to help reduce incidents.
Use HR Technology to Combat Workers’ Comp Claims
Some integrated HCM plans offer employers built-in protection against potential Workers’ Compensation claims.
For example, EPAY HCM’s time-tracking module can be programmed to ask employees, “did you have a safe day?” each time they punch out via time clock or mobile app.
A “no” immediately alerts employers to a potential claim, while a “yes” may later help refute an undocumented claim filed after an employee reported an accident-free day.
In addition, EPAY HCM’s HR module allows employers to track Workers’ Compensation cases, audit claim reports, track leave management, and more—all of which give employers greater insights and control over claims activity.
In short, there are proactive steps employers can take to control Workers’ Compensation costs. And in today’s competitive—and litigious—business environment, employers need to use every tool available to keep a lid on such costs.
This information was drawn from EPAY’s webinar, 10 Tips for Reducing Workers’ Compensation Costs, featuring attorneys from Knell, O’Connor, Danielewicz. You can view the complete, recorded webinar here.