Issues Facing Self-Insured Employers: Past, Present and Future

At the 2018 National Council of Self Insurer’s Annual Meeting, Max Koonce from Sedgwick talked about issues facing self-insured employers now and into the future.

The very definition of employee and injury are changing. A recent Supreme Court case in California dramatically shifted the definition of who is an employee (vs independent contractor). The courts are also increasingly allowing claims where the actual “injury” was an aggravation of preexisting conditions. These two fundamental shifts are having a significant impact on workers’ compensation.

Issues Discussed:

Reacting to catastrophes:

Every employer should have a disaster recovery plan on how they will keep their businesses running in the event of a natural disaster. How will you keep paying your workers’ comp claims and ensure that injured workers continue to receive medical treatment. You also need to pay attention to your supply chains and the vendors you rely on to keep your business running as they could be impacted by natural disasters which could impact your business.

Preparing for the threat of emerging risks:

Cyber threats are the biggest areas here currently. It is such as difficult risk to manage as the threat is constantly evolving and the potential damage seems to be redefined with every big breach.

Protecting first responders:

We depend so much on our first responders, especially in situations of crisis. Because of this it is important to make sure we are taking care of these people in the time of a crisis. If they are worrying about their families or whether any injuries will be covered under workers’ compensation they will not be performing at their best.

Asserting control over the drug crisis:

States have been responding to the opioid crisis for several years with many implementing PDMPs and drug formularies. The Federal government is getting more involved than ever in regulation over the opioid crisis, with the CDC issuing guidelines and the government taking a hard look at the physicians who have been excessively prescribing these medications.

Collaborating for compliance:

There is a huge interplay between workers’ compensation and other leave of absence programs such as ADA or FMLA. It is more important than ever that employers break down silos between risk management and Human Resources to ensure they are complying with all the different legislation in these areas.

Expanding leave programs:

Employers are expanding leave programs as a tool for talent attraction and retention. States and local municipalities are also mandating mandatory leave laws that go well beyond federal requirements.

Racing toward self-service innovation:

At a conference last year, a speaker with a major health carrier indicated over 80% of their claims were self-adjudicated. This is something we have barely even explored on the workers’ compensation side. Is the time and expense of adjudicating medical-only claims providing a return on investment and the best customer service for injured workers?

Supporting diversity and inclusion within claims management:

Having a diverse workforce within our claims administration programs will help us to better relate to the injured workers that we serve. This is not just about diversity of ethnic background or gender, but also about age. Different people have different expectations with regard to the frequency and method of communications. A more diverse claims workforce will help us to communicate with injured workers appropriately.

Broadening the knowledge and capabilities of today’s claims professionals:

We need to keep in mind the bigger picture of things when handling claims. On the liability side, businesses need to balance customer service with claims handling as you don’t want to lose a customer over the handling of a minor claim. If we are going to deny a claim, keep in mind the potential ramifications of that beyond just the claim you are handling.

Putting whole health into practice:

We need to be looking at the bigger picture when it comes to the health of our work force. Looking at “whole health” means focusing not just on physical health, but also their mental health and even their financial health.

Capitalizing on the power of integrated resources:

There is more focus on a coordinated return to work process, regardless of whether the absence is due to occupational or non-occupational. It is important that your data is integrated so that you can respond appropriately to each employee. There is a balance between specialization and generalization. You need the specialization to respond appropriately, but also the bigger picture perspective.

Exploring alternatives for pain management:

As we move forward in the battle of inappropriate opioid prescribing, we need to be looking into the alternatives that are available for pain management. We need to be more accepting of physical therapy, acupuncture, biofeedback, comprehensive pain management programs, and other alternative pain management strategies. Medical management may also have a role in this.

Automating healthcare through artificial intelligence:

Can chat bots and artificial intelligence other automated provide medical coaching? There is a big push for this on the group health side. Are there also opportunities to expand this automation including scheduling appointments, requesting medical records, and communicating with the physicians’ office. There are health care systems now that have apps that allow you to do all these things. This is something worker’s compensation has not even considered.

Moving beyond the predictive model:

Predictive modeling has been around for years. There is an opportunity to move more toward real-time modeling that can help improve outcomes vs models that are done retrospectively that really don’t kick in until the claim has been open for a period of time.