At the 2015 Self-Insurance Institute of America National Conference, Tammy Worthey from Sedgwick and Junia McGraw from Arizona Public Services discussed how integrating your absence management program can benefit both the employer and your workforce.
One of the big challenges around absence management is the silos in which different benefit delivery systems operate. Workers’ compensation usually falls under risk management, and non-occupational disability is managed by human resouruces. There are often different strategies for the different programs, and data is usually not shared.
Most “integrated” absence management programs are coordinated, not truely integrated. A coordinated program still has the issue with silos due to different people having oversight over the different areas, and sometimes there can be different vendors handling the different areas. A true integrated program has one process owner (usually in human resources) and a single vendor handling both areas. The data from the two programs is also integrated which allows for more complete analysis and better decision making.
The key points of integration are:
- Single intake of new claims. Employees only need to make one call and the vendor makes sure the appropriate claims are set up. The focus is on providing benefits to the worker timely rather than arguing about which silo the benefits should be paid under.
- Sharing of medical records. This streamlines medical from providers to the claims team and helps to reduce costs by avoiding duplication of efforts.
- Coordination of payments. This ensures the employee is receiving all the benefits they are entitled to under the different plans and also eliminates duplicate payments. If the workers’ compensation claim is being disputed, benefits are paid under disability during the adjudication of this dispute. By making sure the worker receives benefits it can cut down on litigation and increase the satisfaction of the injured worker.
A cornerstone of an integrated disability management program is a consistent return to work approach. Employers who only offer modified duty for workers’ compensation and not for non-occupational disability can run into issues with FMLA / ADA compliance. You can also achieve savings when applying a return to work program to your STD / LTD program. When possible, it is better to find meaningful work for the person on modified duty vs just making up tasks they can perform. If the person feels they are contributing to the company they will have a better attitude about the return to work program.
One of the strong points of an integrated disability program is the analytics this allows. You receive comprehensive and comparable data across all lines of disability. This can assist safety in loss prevention efforts. It can also help the employer focus wellness efforts based on common conditions that are seen. The data integration also allows for a seamless employee experience and continued improvement in your return to work programs.
There are many challenges when it comes to implementing an integrated disability management program. The first is the different decision makers that are involved. One of them needs to be willing to give up oversight in order to make an integrated program work. At times, internal politics will inhibit the development of an integrated disability program.
Another challenge is that few vendors offer a truly integrated benefit program with a single intake and sharing of data. The same adjuster does not handle both workers’ compensation and disability claims, but behind the scenes there needs to be integration.
A true integrated program usually requires the employer to be self-insured for all lines being integrated (workers’ compensation, disability, and group health). It is possible to have an integrated program with different carriers involved, but that is a significant challenge that must be overcome to allow for common administration and sharing of data.
A final challenge is building the business case for an integrated program. The easiest argument is for simplification of the processes. The access to better data is another strong argument. A detailed analysis of the employers’ workers’ compensation and disability programs is needed to show potential return on investment for an integrated disability management program.
The potential benefits of an integrated program includes a reduction on disability benefit duration, elimination of redundant claim reporting, reduction of workers’ compensation litigation, and a reduction in the FMLA days by applying return to work programs consistently.