Let’s gain some insight to develop and execute a holistic approach to controlling the cost of claims by: defining your partnerships by performance and outcomes versus service levels and tactics, selecting and quantifying key targets that establish proper focus and accountability on few greatest opportunities to reduce your costs of risk, integrating a comprehensive data management plan for better decision making and accountability, and implementing and executing data driven solutions that are proven to reduce loss cost. At the 2017 CWC and Risk conference a panel of experts dives into these costs saving ideas.The panel included:
· Kevin Grady, Managing Director and ZOOM Practice Leader, Beecher Carlson
· Chris Brown, Risk Manager, AutoZone, Inc.
· Jennifer, Account Management, Gallagher Bassett
· Scott Ritto, VP, Risk Management, Kilroy Realty Corporation (moderator)
“I believe that this nation should commit itself to achieve the goal, before this decade is out, of landing a man of the moon and returning him safely to the Earth.”
— President Kennedy May 25, 1961.
Set Goals- outperform projected WC losses and reduce collateral
Act on lead measures- high risk claims reduction and process improvements
Keep score – quarterly scorecards and KPIs, emergency schedule
Hold accountable – joint steering committee and action teams, quarterly accountability meetings
Focus is to begin with the end in mind. There is a need to differentiate between your goals and your service levels. Keys to reducing costs equals reduce duration. Between one year and five years the growth rate is 821%, which is a yearly increase of over 200%. The main goal of the company should be to reduce the duration which in return will reduce the cost of the claim.
Implement a robust data management plan
There are goals, analytical strategies and actions. The goals include historical claims, current claims and prospective claims. The analytical strategies are scorecards and goal tracking. Not every claim is equally worth solving. Each company has unique risk and need to create strategies around those unique risks.
8.6% of claims develop $10k after 90 days which is an average of $56k in additional growth. These claims account for 65% of total incurred. And the these claims develop less than $10k saw an average incurred reduction of $2,100.
The Rx RN’s focus is to: assess claims with potential risk and ID Rex plan of action, consult with MWM when complex Rex issues are identified, provide consultation to resolution managers on Rex questions and issues, and collaborate with the PBM team to manage the total claim. The TCM/FCM continues to manage overall medical treatment and vital to engage them when other complex medical issues arise. Programs have to be about driving change not just about having the program in place.
AutoZone MSA program
Collaboration with the dedicated RxRN to reduce the medication prior to obtaining MSA
Specific claim handling protocols prior to obtaining an MSA
MSA solution includes:
- 30%+ reduction n the cost to fund the MSA
- Shortened the overall duration of the claim
- Utilizes a modified non-submit program within the Medicare review thresholds
- Settlement release language to protect AutoZone against any liabilities brought against the client by CMS
- Enforce litigation avoidance strategies (increase and enhance all methods of early engagement, WC brochure mailed with existing get well cards, test claim liaison role, and increase utilization of first call settlements)
- Regular engagement of all parties at specific stages of litigation to reduce duration
- Implement legal bill review
- Refine guidelines for outside counsel
- Develop a law firm scorecard
Companies are encouraged to keep scorecards to be able to look at closure ratios. This allows the company to rank those workers and creates a motivating competition. Every initiative should have a scorecard to make sure you know how you are doing at any given time.