Worker Compensation

Worker Compensation –It’s a Partnership

Provider

Employer

Employee

Insurance

SAFETY

Regulatory Compliance

Worker Compensation

PROACTIVE REACTIVE


Upton Sinclair, socialist author of The Jungle, a novel detailing the horrors experienced by a Lithuanian immigrant working in the Chicago slaughterhouses and the Triangle Shirtwaist Factory Fire.

WC is a form of insurance with stipulation – compensation for wages and medical treatment who are injured during the course of employment in exchange for mandatory relinquishment of employee’s right to sue the company for the tort of negligence

Worker Compensation is paid for by the employer, either self funded or by purchasing WC insurance.


Before WC, if an employee was injured and off work – it was “too bad for you”

The employer could be faced with a lawsuit

It was the injured who had the burden of proof of negligence on the part of the employer – tough job


The cost of Worker Compensation Insurance is determined by two basic things –

What is your risk and exposure (determined by the classification of employees) and by your history of claims


What you can control -The basic formula for WC Insurance cost is: 1.Determine the classification code for your employees2.Determine the rate for each classification code3.Calculate the total annual payroll for each class code4.Divide the total annual payroll for each class by 1005.Multiply the new number by the class code rate6.Add the premiums for all codes together, this is your base rate

7.Multiply by your experience or mod rate


Determine the classification code for your employees 5 secretaries at $12.75/hr 25 house builders at $22.90/hr 5 carpenters at $24.70/hr 2 debris removal at $14.50/hr


Divide the total annual payroll for each class by 100 5 secretaries = $127,500 / 100 = $1,275 25 builders = $1,096,250 / 100 = $10,962 5 carpenters = $265,525 / 100 = $2,655 2 debris pickup = $58,000 / 100 = $580Multiply the new number by the class code rate$1,275 X Add the premiums for all codes together, this is your base rate

Multiply by your experience or mod rate


Multiply the new number by the class code rate secretaries $1,275 X (class 8810 rate).850 = $1,083.75 builders = $10,962 X (class 5645 rate) 3.10 = $33,982.20

carpenters = $2,655 X (class 5651 rate) 1.98 = $5,256.90

debris pickup = $580 X (class 5650 rate) 2.25 = $1,305

Add the premiums for all codes together, this is your base rate

$41,627.85


Add the premiums for all codes together, this is your base rate

$41,627.85

Now multiply by your experience or mod rate:Base rate X mod rate = amount paid for WC insurance $41,627.85 X 1.00 = $41,627.85 $41,627.85 X 1.20 = $49,953.42 (+ $8,325.57) $41,627.85 X .80 = $33,302.28 ( - $8,325.57)


Now multiply by your experience or mod rate:

Experience modifier or mod rate is a term used in WC insurance. It is the adjustment of annual premium based on previous loss experience. Usually 3 years are used to determine the mod rate for a WC policy.

THIS IS SOMETHING YOU CAN CONTROL/MANAGE!

I =(C*(1–A)+G)+(A*F) E+(C*(1-A)+G)+(A*C)

A = Weight Factor G = Ballast I = Actual Primary

Losses H = Actual Incurred Losses F = Actual Excess Losses (H-I) E = Expected Primary Losses D = Expected Incurred Losses C = Expected Excess Losses (D-E)



“The modern system of workers' compensation is so complex and arcane it produces considerable grief to those who must deal with it on a daily basis. Yet these often cumbersome regulations are so ultimately vital to society they appear, in one form or another, in all

industrialized nations. “ Iowa Orthop

J. 1999; 19: 106–110.


It’s a Partnership and everyone has their role –

Employee – must report the injury, follow doctor’s orders and keep the employer informed

Employer – must ensure injured employee receives medical attention as needed, report to insurance company within 7 days and keep insurance company informed

Claims – must gather information, determine if claim is work related or not, pay employee benefits, settle the claim

Provider – must treat patient and determine restrictions or limitations, determine if work related, release employee back to work when appropriate


1. Injury/illness must arise out of “employment” 2.Seek medical attention as necessary3.Employee has up to 2 years to report

injury/illness (30 days)4.HIPAA does not apply to WC cases5.Keep a written record of all facts6.File report with insurance company (must be

filed within 7 days)7.The insurance company will gather information

from employee and any medical treatment


The insurance company will gather information from employee and any medical treatment –

So what is your role??

DOCUMENT

INVESTIGATE

FOLLOW-UP


Things to Document• Physical symptoms, such as sharp pain, stiffness, loss

of motion, etc• How long the symptoms lasted; if and when they

recurred.• Names of any witnesses • The doctors seen and the date of each visit. • Money spent on doctors, exams, treatment, medicines

and mileage. • Days lost from work because of the injury/illness. • Any statement made to the employer or the insurance

company. • Copies of any agreement or final receipt signed for a WC

claim.


The employee gains by RTW when a doctor allows

1.This is your time to be talking to the doctor, you have every right as HIPAA does not apply.2.If you aren’t talking to the doctor, the injured employee is.3.Why pay a top wage earner to do lesser jobs that a restricted worker could be doing?4.Workers will return sooner rather than go from totally off work to full duties.5.Gets you involved and gives you some control of the recovery.6. Many workers want to come back to work.


Return To Work

Convey to the doctor your concern to stay within the physical capabilities and ensure employee’s recovery

Make these temporary work assignments giving you control to end them. Suggested 12 weeks max of light duty.

You can give the employee any job to do as long as it does not go beyond those physical capabilities. (Think outside the box)


EARLY RETURN TO WORK ... IT WORKS FOR YOU!!

The employee may be reluctant to start working again for fear of pain, re-injury or not being able to perform as well. If a different job is required because of the injury, there may also be a concern about trying something new. (and will convey this reluctance to the doctor)

We may not be willing to bring workers back to work, for many of the same reasons. It is helpful if employers have some type of limited duty, or alternate work, to help workers gradually get used to being back in the workforce


If the employee is not satisfied with the first doctor, one more choice is allowed; however, the worker must notify the employer of this second choice. Only 2 choices are allowed to employee.

Worker Compensation –It’s a PartnershipOn written request, an employee

should submit promptly to a reasonable examination by any doctor (physician, chiropractor, psychologist, dentist, physician assistant, advanced practice nurse prescriber or podiatrist) named by the employer or insurance company.

IME (Independent Medical Exam)


•If a WC claim goes to court, it can be two or three years later – go back and look at your notes from a couple of years ago. Are the notes clear enough you can understand the details of the incident? Were witnesses statements taken? Photos? Doctor notes? Supervisor's notes?

It’s a little late now!

Worker Compensation –It’s a PartnershipWhen an employee has stopped

receiving weekly compensation benefits for temporary or permanent disability after an accidental injury, the claim may be reopened at any time within 12 years from the date compensation was last paid. This 12-year period does not apply, however, where a compromise agreement has been made and approved by the department or where a final award has been issued after a hearing.


Lost Time expenses are calculated at 100%

Restricted Day expenses are calculated at 30%

BIG DIFFERENCE, BIG INCENTIVE FOR RTW


What do I do?1. Make sure your risk classifications are correct for

employeesa. Build a relationship with your insurance

carrier/claims

2. MANAGE claims –a. Make sure your policy requires immediate

reporting of injuriesb. Make sure your supervisors have training on

accidents and are responsible for RTWc. Document, document, document


What do I do?a.Form a relationship with the medical providersb.Develop your company policyc.Form a relationship with injured employeesd.Return to work programe.Be informed, follow up, know what is going on


THE MORE YOU KNOW – THE MORE YOU CONTROL


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Worker Compensation

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Transcript of Worker Compensation