Reducing impacts and improving life outcomes in workers’ compensation
The cost of accident, workplace injury and death is $2.8 trillion USD annually worldwide. The cost is not just medical management, but ultimately includes lost productivity and a reduction in work-life capabilities.
Annually, there are 270 million accidents and 160 million work-related diseases (eg: dust, cancer, etc.) across the globe, with over 2 million lives lost from workplace accidents, as estimated by the International Labour Organization. These are significant numbers. And it’s statistically proven that those countries with lower accident rates have resulting higher GDPs.
It’s pretty simple. People who are injured and are not working are also not producing goods and services for the economy; therefore, a positive reduction in a number of days lost due to injury will ultimately result in a country’s corresponding improvement in its overall gross domestic product. If you can return injured workers to the workplace earlier, by even just one day, you can easily make a case that this would add $100m USD back into the world’s economy.
The insurance industry as a whole needs to take a more innovative approach to addressing how to control the astronomical costs and improve business outcomes of workers’ compensation. It can do so through:
- More timely and efficient processing of claims
- Increased claimant responsibility through self-determination programs
- Enhanced information and analytics for treatment plans and rehabilitation use
- More preventative – and increased – loss control
In turn, all of these measures will also lead to improved life outcomes, which is the ultimate goal.
Timely, efficient reporting and processing of claims
When a company experiences a workers’ compensation claim, it affects more than just the injured employee. From an employer’s perspective, there is lost production and continuity, increased costs and resource strains. And time is of the essence, for care and because there can be a significant financial impact on delayed reporting of a work cover claim, including higher costs and missed opportunities to mitigate medical spending. It can also lead to increased employee anxiety, confusion and ultimately unnecessary litigation.
Here are some key pieces of information to keep in mind:
- Keep claim costs down: Delayed reporting can significantly increase workers’ compensation claim costs, according the National Council on Compensation Insurance. The lowest median cost is for claims reported in the first two weeks.
- Close more claims quickly: More than half of claims reported within the first two weeks close within 18 months. However, only 29 percent of claims that are reported more than a month after the accident close within the same timeframe.
- Digital portals: Digital portals enable insurers to provide state-of-the-art capabilities for the employer, injured worker, medical practitioner and case worker to more effectively initiate, gather and collaboratively share information. This fosters the ability to work together to improve claim reporting and processing.
Expedite healing and earlier returns to work
Employees who are satisfied with the overall response to injury or illness return to work 50 percent faster with 54 percent lower cost. Additionally, medical treatment within specialized occupational medical clinics familiar with treating workers’ compensation injuries may result in quicker healing and earlier returns to work. Claimants who are given accountability for their own recovery through self-determination are empowered to make their own decisions regarding care and show improved times in returning to work quicker.
Making defined guidelines for suggested treatment protocols immediately available at the time of diagnosis enables the injured worker to immediately have a treatment plan in hand, including the expected return-to-work date. You should immediately transfer this supporting information to the insurer so the purchase plan for treatments is pre-approved and payment is scheduled. Recommended support groups to enhance rehabilitation and improve return-to-work statistics should be automatically provided and uploaded within the plan.
Use of predictive analytics to provide proven treatment plans and preventative measures
Today’s injured employee is likely to be older, in poorer health, and at higher risk for a complex injury or claim than in previous decades, according to Property Casualty 360. The use of predictive analytics allows claims managers to identify potential complicating factors about an individual’s condition up front, enabling them to take these risks into account and create a more proactive approach to their ongoing treatment plans.
The same data and insights can be used to determine best methods for recovery and can also be applied to a return-to-work plan to reduce the risk of re-injury. Insights from predictive analytics can identify “routine” claims that have the potential to become complex, as well as patterns in types of injuries that can be corrected to reduce costs and improve outcomes.
Modernization of workers’ compensation platforms is a requirement if global insurers are to ensure the future of this market segment, provide the ability to reduce and manage costs, and most importantly, improve life outcomes.
You don’t have to look far to find help. The combined efforts of industry leaders like Hyland and Guidewire are bringing to market the most comprehensive integrated and most innovative insurance software solutions the industry has seen in decades.
See us Table 10 at the 18th National Workers Compensation Summit in Melbourne, Australia to learn more.