37 Ten Best Tips for Workers’ Compensation

10 Best Tips for Managing a Successful Workers’ Compensation Program

Steve Heinen

Is anyone concerned that we have seen the largest back-to-back indemnity benefit increase in the history of Georgia’s Workers’ Compensation system? Proponents argue the weekly indemnity rate is one of the lowest in the nation, which is true.

But—and there always is a but…

The most recent Compscope report from the Workers’ Compensation Research Institute (WCRI) details that we have one the highest indemnity benefit payout of any state in the 18-state study. So, despite having the lowest indemnity rate of any state in the study, Georgia’s indemnity and expenses are forty-eight percent (48%) higher than the median of the other states in the 18-state study (California’s TTD cap is 1,356 and Illinois’s TTD cap is 1,734).

In Georgia, over forty percent (44.2%) of claimants retain counsel, and claimants in our state have a much longer duration of disability. This study was completed before the back-to-back indemnity increases. With Georgia’s TTD and TPD rates increasing at a record clip, you can expect the disparity of higher indemnity and litigation expenses in Georgia to continue. Short of legislative changes needed to address the “why” behind our length of indemnity and high attorney involvement, employers need to meet this challenge by digging to improve their risk management program.

The good news is our system has not seen many changes since 1994 and that stability has created a predictable system.

In 2002, I developed a process called comP4®, which takes a holistic approach to Workers’ Compensation. It looks at twenty-one (21) activities from Pre-hire, Post-offer, and Prevention to Post Claim. Here are my Top 10 comP4® tips for managing Workers’ Comp:

1. Develop a safety culture that the employee feels on Day 1 of hire. We recommend an employee safety perception survey every three years to ensure your safety culture is thriving. 2. Develop written job descriptions including physical demands analysis to be used in the hiring process. These job descriptions are essential to Board Rule 240 and will significantly reduce the lag time in getting employees back to work. 3. Become a certified drug-free workplace and utilize a refusal of treatment form. 4. Utilize an effective post-offer health questionnaire. 5. Develop a meaningful new hire and ongoing safety training program. In addition to meeting your Occupational Safety and Health Administration (OSHA) obligations, the Burdette case also established a willful misconduct defense for employees willfully refusing to follow safety rules. An effective and accountable safety program creates accountability. The goal of every safety program is to send employees home safely every day. 6. Establish a safety committee to gather feedback and share safety information. 7. Discipline employees who fail to follow safety rules and training. Points 5, 6, and 7 are keys to establishing a Burdette defense. 8. Create a return-to-work process. **Note, I didn’t say program because you need to include several parties in the process. The employee is involved, but you should also include the supervisor, the medical provider, and the adjuster. I rarely see everyone working together, which creates opportunities for the claimant attorneys to drag out the claim and resolve the case with a settlement accompanied by a voluntary resignation letter. 9. Create a timely incident reporting program. I recommend utilizing a third-party platform to assist customers with their claim reporting and management, but you can develop an internal process. Lag time significantly increases cost, especially in a highly litigated system like Georgia. Therefore, timely reporting along with an

effective incident analysis is a critical part of an effective work comp program. Also, remember, that notice to a supervisor constitutes notice in Georgia. 10. Develop a claim action plan. I recommend a 3/7/21-day plan. Claims that start on track through the first 21 days typically stay on track.

Here is the 3/7/21-day plan:

• 3 days – review the claim to determine if it is medical only or if you think it will become a lost time claim. If you believe it will become a lost time claim, activate the 7 and 21 day plan. • 7 days –the employer should be sending things to the adjuster to help them manage the claim. This could include a circle and signed copy of the panel, the WC-207, the incident report, and a copy of the post-offer health questionnaire. • 21 days – the adjuster has reviewed all the information, including their own internal info (like the ISO report), and makes a compensability decision.

Education and communication are the two keys to managing a Workers’ Compensation claim. If the employee trusts the employer before the injury, they are far less likely to retain counsel after the injury. According to Clara Analytics, litigated claims increase costs by 347%, so investing in an integrated Workers’ Compensation program makes cents.

Georgia has enjoyed a ten-plus-year run where rates have declined. With the recent indemnity increases coupled with expanded litigation costs, Georgia employers will most likely see rate increases soon. Now is the time to build an accountable and effective workplace safety program.

Steve Heinen, a partner at Sterling Seacrest Pritchard. He developed the P4 process (now comP4®) in 2000 and it has been utilized by hundreds of organizations to reduce costs. His Work Comp Playbook for Employers has sold over 2,000 copies and his Compass Risk Management System is designed to help organizations implement a proven risk management process.