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GAWDA Professional Compliance Seminar

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GAWDA Professional Compliance Seminar

Workers’ Compensation Loss

Prevention

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GAWDA Professional Compliance Seminar

Safety as a profit center

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GAWDA Professional Compliance Seminar

• What is the single most important factor to prevent employee injuries and vehicle accidents?

Stop Injuries

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GAWDA Professional Compliance Seminar

• Overt management commitment

• When the employees believe that you are committed to their safety, they will stop having accidents…Uncomfortable?

Stop Injuries

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GAWDA Professional Compliance Seminar

• Case studies• Fatality investigation• Fingers crushed• Internal audit response…

disappointed• Steel• Pigment manufacturer• Eastern Region… post fatality

Stop Injuries

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GAWDA Professional Compliance Seminar

• Tommy Brubaker• Machinist • Midnight shift• Lathe• Warnings? Jackets• Accountability?

Case History #1 – Fatality

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GAWDA Professional Compliance Seminar

• Trailer manufacturer• Punch press operator• Dual actuator buttons• Three fingers crushed• Warnings? • Accountability?

Case History #2 – Crushed Fingers

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GAWDA Professional Compliance Seminar

• Bhopal tragedy• UCC internal audit• Cleanup• True commitment?

Case History #3 – Audit Response

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GAWDA Professional Compliance Seminar

• High quality rail road wheels• Poor labor relations• Emerged from bankruptcy• Projection of $1.1 million in

workers compensation losses per year.

Case History #4 – Steel Company

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GAWDA Professional Compliance Seminar

• $38M sales, $3.5M W/C premium

• Significant evidence:• Exaggeration • Misapplication of benefits …

workers’ compensation was used in lieu of health or unemployment benefits

Case History #4 – Steel Company

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GAWDA Professional Compliance Seminar

• The Solution• Successful proactive loss

prevention program• Supervisors trained in

accident investigations, modified duty, and profit consequences

• Safety committee was refocused from complaint evaluation to injury prevention

Case History #4 – Steel Company

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GAWDA Professional Compliance Seminar

• Results…• First year:

• 50% reduction in injuries• 66% reduction in costs• $1M premium reduction

Case History #4 – Steel Company

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GAWDA Professional Compliance Seminar

• PA company bought similar VA company

• Due diligence – W/C insurance

• Zero reported injuries• True?

Case History #5 – Pigment Manufacturer

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GAWDA Professional Compliance Seminar

• Facility inspection• FX, floor holes, open vats,

bicycle chains/gears, housekeeping, machine guarding

• Owner interview – 0 injuries

Case History #5 – Pigment Manufacturer

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GAWDA Professional Compliance Seminar

• How was injury rate so low?• Onsite owner impact, owner

attention• Remote owner… prediction

Case History #5 – Pigment Manufacturer

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GAWDA Professional Compliance Seminar

• Fatality• New safety consultant• 12 months (training,

investigations, STOP, etc.)• Worst to first

Case History #6 – Eastern Region

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GAWDA Professional Compliance Seminar

• The maximization of profits comes from the minimization of losses

• Proactive Loss Prevention

Peter Drucker

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GAWDA Professional Compliance Seminar

• Proactive risk management vs. traditional loss control

• Applies to • Workers’

Compensation• Vehicle Liability

Two Safety Paradigms

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GAWDA Professional Compliance Seminar

• Security Services • Grocery• Delivery Fleets• Temporary Service Employers• Restaurants• Iron & Steel Manufacturing• Hospitality & Healthcare Institutions• Welding Gas Distributors

Where proactive risk management works?

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GAWDA Professional Compliance Seminar

The Complete Risk Management Program

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GAWDA Professional Compliance Seminar

• Loss Control (Traditional Approach)• Manages Costs After Loss

Experience• In Short, “Reactive”• Insurance company responsibility

• Risk Control (Alternative Approach)• Manages Performance Before

Experience• In Short, “Proactive”• Your responsibility

Loss Control vs Risk Control

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GAWDA Professional Compliance Seminar

If Common Today

•Poor Planning

•Lack of Training

•Unsafe Conditions

Possible Tomorrow

•On Site Accidents

•Injury/Death

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GAWDA Professional Compliance Seminar

• Client – Midsize Welding Gas Distributor

• Problem • 30 vehicle units - 6 months• 9 preventable accidents • 2 non-preventable accidents

• Solution - A structured program • Outcome

• 0 preventable accidents • 2 non-preventable accidents

Case Study #1

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GAWDA Professional Compliance Seminar

• What made the difference?• Commitment!• Accountability• First Executive Safety

Committee meeting – all OK• Second meeting –

commitment• Third meeting -

performance

Case Study #1

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GAWDA Professional Compliance Seminar

• Preventing losses IS possible!• Always less expensive than

traditional loss control approaches

• Less equipment damage and downtime

• Fewer customer issues• Professionalism rises• Profit is improved

Why Practice Prevention???

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GAWDA Professional Compliance Seminar

1. Management leadership2. Assignment of responsibility

and accountability3. Maintenance of vehicles,

equipment4. Pre-employment checks5. Establishment of effective

safety committees and training

10 essential elements

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GAWDA Professional Compliance Seminar

6. Accident record keeping system7. Medical and first aid systems8. Acceptance of personal

responsibility by employees9. Post loss management activity10. Results monitoring and

program evaluation

10 Essential Elements

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GAWDA Professional Compliance Seminar

• Systematic accident investigations• Major, minor, near miss

• National Safety Council guidelines for determining preventability

• Operator and driver/supervisor training

• Personnel and vehicle safety incentives & communication

• Discipline & accountability

Management Techniques

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GAWDA Professional Compliance Seminar

• Humanitarian• Less pain

• Regulatory Compliance• Avoid OSHA/DOT hassles,

citations• Financial

• Lower costs, liabilities, down time• Business/Officer Protection

• Documentation, manual, program

Benefits of Prevention

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GAWDA Professional Compliance Seminar

• How to measure the company’s real safety performance?

• Whose performance?

How to measure…

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GAWDA Professional Compliance Seminar

• Your performance• You (owners, line managers)

are accountable … or can become accountable

• Case Study – Temporary Service Employees

• Case Study – Fraud, Pasadena, CA

How to measure…

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GAWDA Professional Compliance Seminar

Industry Comparison

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GAWDA Professional Compliance Seminar

• How to measure your real safety performance?• Long term – W/C rate

• Professional, unbiased numerical appraisal

How to measure…

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GAWDA Professional Compliance Seminar

• How to measure your real safety performance?• Short term

• Non-injury incidents (near misses)

• First Aid Cases• Recordable injuries• Lost workday cases

How to measure…

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GAWDA Professional Compliance Seminar

Unsafe Behaviors/Unsafe Acts

Fatalities

LostTime Cases

Recordable Injuries

Medical Visits/First Aid Cases

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GAWDA Professional Compliance Seminar

• Insurance company structures (policy, rent-a-captive, captive, self)

• Premiums adjust for 3 years plus 1

• Do some insurance companies care about your performance?

W/C Insurance

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GAWDA Professional Compliance Seminar

• Insurance companies are designed to make more money when you have more injuries

• Case Study - Rapid City

W/C Insurance

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GAWDA Professional Compliance Seminar

• Experience Modification Factor (XMod)• Frequency – each injury

counts as 1x• Severity – Lost workday

cases count about 10x

W/C Insurance

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GAWDA Professional Compliance Seminar

• Control your frequency by stopping accidents• Accountability• Measurement• Training• Overt commitment

W/C Insurance - Frequency

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GAWDA Professional Compliance Seminar

Dupont STOP Program

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GAWDA Professional Compliance Seminar

STOP For Employees Concepts

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GAWDA Professional Compliance Seminar

STOP Safety Cycle

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GAWDA Professional Compliance Seminar

• Control your severity by managing the case:• Assertive return-to-work• Professional medical

treatment• Trusted doctors (2-way

trust)• Fight suspected fraud

W/C Insurance - Severity

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GAWDA Professional Compliance Seminar

• The maximization of profits comes from the minimization of losses

• Proactive Loss Prevention

Peter Drucker

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GAWDA Professional Compliance Seminar

Q&A