WORKERS' COMPENSATION INJURIES: EMPLOYERS' BEST PRACTICES (01/21/2011)
By Meghan Bankhead, Cavignac & Associates
Workers’ compensation claims are an inevitable part of doing business. Even the safest company in the world will eventually have an employee get injured on the job.
The costs of work-related injuries are high. Injuries not only increase premiums, but also can increase a company’s experience modification, make it harder to bid jobs, reduce productivity, and potentially cost the company a valued employee and the resources to replace that employee.
These costs can be mitigated if the appropriate risk controls are in place before an injury occurs. Such risk controls include an aggressive set of best practices in three key areas: injury prevention, accident response and claim management.
Injury Prevention
The single most important practice to prevent injuries is a comprehensive safety culture. When safety is important to every member of the company, from top management down, the frequency and severity of work-related injuries diminishes.
First, establish a safety committee that includes a member from each department. This creates buy-in and a sense of responsibility—from the CEO to the hourly employee. When everyone owns the responsibility for safety, everyone takes it seriously.
The committee should review all injuries and near-misses every month, and collaborate on safety controls that can be put in place to prevent recurrence. The committee also should encourage safety suggestions from the entire company via a suggestion box or other anonymous method of communication.
Second, establish a safety incentive program that rewards safe practices and periods of time without injury. However, keep in mind safety incentive programs alone can create a tendency for employees to under-report, which does not improve safety or prevent injuries. In fact, when minor injuries are hidden, the likelihood of a serious injury increases. For this reason, it must be a condition of employment that everyone follows safety protocol. Contractors must establish a no-exceptions safety infraction program.
Accident Response
Once an incident or injury occurs, the events of the next 24 hours impact the ultimate cost and outcome of the claim. Contractors must be prepared to respond quickly and efficiently to any injury.
Everyone in a position of responsibility in the company should be trained in post-accident response, even if the company rarely has injuries. An infrequent claim history makes it more likely that employees and supervisors will not know what to do in the event of an injury, and they may inadvertently make a decision that could adversely impact the length or cost of the claim. The following key aspects comprise a strong accident response program.
Medical Care
In California, employers now have the ability to direct medical care to an approved network of physicians and treatment facilities that meet criteria established by a workers’ compensation insurance company. These facilities often have agreements with an insurance company to bill at a discounted rate.
Choosing a medical clinic is an important part of the pre-claim process. Visit several clinics and choose the clinic that fits in terms of hours of operation, ease of access, onsite services and treatment types, staffing, administrative support and philosophy regarding first aid programs.
In addition, establishing a relationship and a rapport with the clinic’s physicians and administrative staff can be invaluable if a serious or suspicious injury occurs. Prompt and thorough medical treatment can shorten the length of treatment and disability, and increase the chances for a speedy recovery and claim closure.
First Aid Program
Establishing a first aid program allows a company to pay for qualifying injuries out of pocket. This will keep those injuries from affecting claims experience and the company’s experience modification. In California, employers have the right to pay bills for first aid treatment, and do not have to file a formal injury report with the insurance company.
It is a recommended best practice that all claims, including first aid cases, be reported to the workers’ compensation insurance company as soon as possible. The insurance company can assist with identifying injuries that could result in permanent disability or escalating medical costs. Delayed reporting of claims ultimately creates higher costs for the employer.
Injury Reporting Procedures
Everyone in the company must understand their responsibility when a workplace injury occurs. A reporting protocol must establish how every employee should report any work-related injury, no matter how small. Every employee should know to whom they should report their injury, and a system must be in place to ensure these reports get to the proper supervisor who is authorized to determine the next step. Immediately after any incident, the following things need to be done:
• Report the injury to a manager responsible for handling workers’ compensation issues. One person should be designated for this responsibility, with a backup person if the primary person is unavailable.
• Complete an accident investigation report. Document what, why, when, where and why the incident occurred, including the names and contact information of any witnesses or potentially liable third parties.
• Remove any dangerous items from the accident location. If these items could be evidence of third-party liability, secure these for later inspection by the insurance company, if possible. This may include defective, improperly maintained, or damaged tools or equipment.
• Determine if the employee needs medical treatment and send him to the designated clinic immediately, along with a letter describing the company’s first aid and return-to-work programs. For emergencies, call 911 or take the employee to the nearest emergency room.
• Report injuries requiring medical treatment beyond first aid or resulting in lost time past the balance of the shift on the injury date. In many states, such injuries must be reported within 24 hours.
Claim Management
Once a claim has been reported, a claims adjuster usually is assigned within 24 hours. The employee and his physician also should be contacted during this time frame.
A broker can be an invaluable resource to ensure the claim is being handled proactively: negotiating reserves on the company’s behalf, advising on how to respond to developments and pressing the insurance company for swift resolution.
The claims adjuster, in conjunction with the broker, always should keep the company apprised of major developments and current action plans, and vice versa.
The contractor should stay in regular contact with the employee and his physician for current medical status and work restrictions. Keeping injured employees at work, or returning them to work as soon as possible, can significantly shorten the overall length and cost of the claim, as well as decrease the likelihood of permanent disability.
Once injured employees have returned to modified duty, remain in contact with them regarding their progress. Ensure each supervisor is enforcing the applicable work restrictions and providing a positive environment while injured employees are on modified duty.
The No. 1 thing an employer can do to promote positive claim resolution is to foster mutual respect and trust between employees and their supervisors. Employees should feel comfortable coming to work during recovery.
The ability to reduce the frequency and severity of employee injuries can make a huge difference to a company’s bottom line. Although a contractor may never be able to eliminate all employee injuries, a proactive focus on injury prevention, accident response and claim management can substantially improve a company’s risk profile.
