Tag Archives: workers compensation

Immediate Vault Immediate Access

Identifying and Preventing Provider Fraud in Workers Comp Cases

Posted on by

Claimant fraud and premium fraud are two of the most well-known types of workers compensation fraud. In these cases, a worker may intentionally fake an injury (claimant fraud) or a business owner may misrepresent their employee headcount or incorrectly classify employees to obtain lower insurance premiums. Now, a lesser-known type is occurring with greater frequency: provider fraud.

Provider fraud occurs when a professional other than the injured worker or employer accepts a bribe or illegal kick-back in exchange for patient or client referrals. The circle of potential culprits includes lawyers, translators, doctors, chiropractors, nurses, and telehealth professionals. Opportunity, incentive and rationalization—the “fraud triangle”—are key factors that go into a person’s decision to commit insurance fraud. These factors have been exacerbated in recent years, due in large part to the pressures presented by the global pandemic and the growing reliance upon remote services.

Most schemes involve knowingly billing for medical goods and medical and legal services that are unnecessary or not provided at all. A chiropractor, for example, conducted illegal medical evaluations and billed these evaluations, claiming that he was approved as a medical legal evaluator. In another example, an attorney named his daughter as the owner of a translation services company, while in reality he maintained ownership of the business. Each time the attorney was hired, the translation business was also engaged and billed its services. Provider fraud is increasingly prevalent in California and Florida due to each state’s workers comp rules. For instance, in California, a provider can file their own lien with the Workers’ Compensation Appeals Board, even if the bill was denied. California is the only state that allows providers to file their own adjudication. At a higher rate than in other states, healthcare providers in California and Florida are sometimes found billing for services that were never rendered, billing for more expensive services than were actually provided, ordering unnecessary tests or procedures, and providing kickbacks to referring physicians.

So, how can we pin down provider fraud?

  • Review Provider Invoices and Reports: Risk professionals can spot potential fraud cases and fraud trends by closely reviewing provider invoices and reports and scrutinizing those invoices that are close to, but not at the top of, typical billing charges. In the workers compensation system, there are typically five levels of a doctor evaluation: Level 1 is the cheapest while Level 5 is the most expensive. Fraud often occurs in Level 4 billings since Level 5 would be too obvious. Providers who consistently bill at Level 4 could be a red flag for fraud.
  • Shine a Spotlight on Supplementary Services: Insurers sometimes overlook that provider fraud can occur with supplementary services such as translation and transportation companies, copy services, medical equipment suppliers and pharmacies. It is not uncommon for insurers to discover that these schemes may involve a criminal enterprise (possibly a referral network) orchestrated by individuals who are not medical or legal professionals. While claimants can be complicit, often they are unwittingly involved and potentially subject to treatment that is unnecessary or even harmful. 
  • Consider Emerging Tech to Pinpoint Provider Fraud: Artificial intelligence and machine learning are game-changers for fraud investigations. Through the analysis of historical claims data and insurance adjuster notes, some technologies can help professionals discover fraudulent claims faster. For instance, AI can be particularly effective at the entity level when a doctor or hospital that is identified as fraudulent can be added to a “bad actors” list for review in future claims. If you do not have a fraud feedback loop, start gathering information now. As risk and insurance professionals, we rely on business rules and claims adjusters to catch all the details of a claim and then form a cohesive narrative to investigate. While business rules work, the fraud feedback loop is necessary to effectively train machine learning models to detect patterns and flag anomalies.

Workers compensation insurance provider fraud has become a multi-billion-dollar industry that is bad for business. It is costly for insurance companies to identify and prosecute, it inflates costs for goods and services that honest business owners rely on, and it stokes consumer apathy and distrust in the insurance system. Risk and insurance professionals need to be aware of the warning signs so they can work diligently to detect and prevent it.

How to Strengthen Your Safety Program and Cut Workers Compensation Costs

Posted on by

Controlling business costs is top-of-mind for organizations of all sizes and can take many forms, from moving the business to a less expensive building in a more economical part of town to cutting advertising costs. Many companies overlook one key way to control costs that can be easily implemented and managed while also improving work culture overall: implementing a safety program to better manage workers compensation costs. When the average workers compensation claim is around $40,000, taking steps to mitigate workers compensation risks and better manage claims can be a great opportunity for any business to both ensure the safety of its workers and protect the bottom line.

Risk professionals can help reduce costs by taking steps to implement any of the following:

  • Improved safety programs
  • More active involvement in claims management
  • Build out a return to work program

Encourage your internal teams to establish a well-planned and detailed new hire onboarding program that reinforces a strong safety culture. Here are some steps that you can integrate into your existing onboarding program that will also help control unnecessary or redundant workers’ compensation claim costs.

Practice Makes Perfect

Onboarding new employees means taking the time to acclimate them to how your business operates in terms of safety procedures, jobsite dos/don’ts, and any potential hazards. Repetition is key for any new employee learning the ropes, but especially for those workers who are jumping into a new role. Ensure all new hires have the appropriate time and space to practice any safety protocols and consider implementing a safety quiz at the end of a designated orientation period to test retention.

Use the Buddy System

Provide each new employee with a veteran employee buddy. This partnership aims to help the new employee get acclimated more quickly to the new environment. During their time together, the veteran employee can discuss safety concerns and identify potential hazards. As worksites can become overwhelming with the amount of hustle and bustle, it will be critical for the new employee to have a partner who is able to help keep an eye out for them and monitor their safety until they are ready to venture out on their own.

Cultivate a Culture of Safety

Encourage managers and team leaders to commit to safety goals and practice what they preach. Setting an example for employees early means that management must be “all in” on safety. This ensures that employees on all levels understand that safety is a company-wide priority. Building a foundation of safety-focused programs with the goal of keeping claim costs low will be key to solidifying each employee’s connection to the organization.

There are myriad ways to reduce workers’ compensation costs. What will be most important to your organization is taking into consideration the time and resources it will take to efficiently improve this area of your business. Whether your team decides to do this independently or with the help of a vendor like a PEO, it is essential for companies to prioritize this part of their business to reduce risk. 

5 Best Practices for Effective Claims Reviews

Posted on by

With the cost of insurance for businesses rising across many types of coverage, staying on top of trends in the claims portfolio is more important than ever. Spotting problem areas and opportunities sooner makes it easier to develop and implement steps to reduce risk pre-loss and better control costs post-loss. For this reason, many insurers and TPAs promise to conduct claims reviews with their business customers on a regular basis, but the rigor can vary greatly. Practices that have been common historically often lack the nuance and precision that can unlock the maximum benefit for each customer’s unique situation.

Here are five best practices for a wide variety of customers across a range of industries:

1. Assemble the right team

Typically, only the person overseeing claims at the business attends the claims review with key claims staff from the carrier. However, this small team limits the potential for brainstorming solutions and getting full buy-in to implement them. In addition to claims experts, it may also be helpful for the carrier’s loss control team to attend, as well as agent/broker staff.

buy isofair online metabolicleader.com/p7pmm/img/jpg/isofair.html no prescription pharmacy

From the business customer side, it is helpful to include all key personnel who can facilitate immediate decisions that will impact the ultimate resolution of the claim in an efficient and timely manner or provide other insightful information. This often includes the risk manager, and may also encompass employees from legal, human resources, safety, operations and even the CFO, in some cases.

2. Develop a clear understanding of the customer to set the claims review objective

Broadly speaking, the goal is always to minimize loss costs to help manage the price and coverage of the overall insurance program. However, each business and claims portfolio is unique. One company may be most concerned with how claims reserves are affecting budgets. Another company may have an unusually high experience modification rate that they want to bring down by reducing the frequency of worker injuries. Yet another company may be changing part of their operation and want to monitor claims activity associated with it more closely than business-as-usual activities. The policyholder’s unique objectives should drive decisions about how often to conduct the claims reviews, what types of claims to include and where to dive into the greatest detail.

3. Fully understand and account for the impact of claims on the insurance program

In the initial design of the insurance program, certain coverages may have been limited due to a problematic claims record. For instance, frequent third-party claims for premises liability may have led to restrictions on Med Pay coverage or a higher deductible to give the customer a bigger stake in safety measures.

buy wellbutrin online metabolicleader.com/p7pmm/img/jpg/wellbutrin.html no prescription pharmacy

Or perhaps the customer hoped for a loss-sensitive program but could only secure a guaranteed cost program due to lack of an internal pre- and post-loss management platform. The claims review should be designed to account for how frequency and severity may affect underwriting decisions so that the policyholder can move toward its coverage objective

4. Choose claims for review according to objectives, not simply dollar value

The default choice for what claims to review is often based on dollar value—e.g., all open claims with incurred losses of $25,000 or more. This approach may miss underlying trends that could lead to severe loss, however. For instance, perhaps a restaurant chain experiences a high frequency of slip-and-fall claims from workers in its kitchens. While these may all have been minor, but it may only be a matter of time until a severe injury occurs.

buy zyprexa online metabolicleader.com/p7pmm/img/jpg/zyprexa.html no prescription pharmacy

With the objective to reduce frequency and the risk of serious injury, the claims review should examine all slip-and-fall claims using data and analytics to uncover causal factors such as food and liquid dropped on floors or seasonal workers with little safety training.

5. Track reserving on a micro level relative to all factors that can affect open claims

Typically, reserving is only tracked from a macro perspective, but this can overlook a variety of factors that could help better manage reserves and ultimate outcomes. For example, are the latest technologies being consistently used to manage costs? Advances in artificial intelligence and data and analytics now allow us to identify treatment providers associated with the best outcomes for injured workers, but how well are companies taking advantage of the recommendations? Early resolution techniques for auto and general liability claims may lower the ultimate cost of claims but cause a short-term bump in claims payments that needs to be accounted for in the customer’s budgeting process.

Potential Benefits

Claims reviews based on these best practices can yield significant benefits, especially when used as part of a holistic approach to managing risk and reducing losses. For example, an early claims review for a new manufacturing customer identified sprain and strain injuries as a problem area. The loss control team then surveyed the manufacturer’s operations and uncovered increased risk due to various manual lifting tasks, such as loading 8-foot-tall plastic silos with heavy equipment in a confined space. Based on that finding, the insurer’s team conducted onsite job hazard analysis supervisory training that included a safe lifting program, online courses and ergonomic risk assessments on a variety of tasks. As a result, within about two years, the program cut the manufacturer’s workers compensation loss ratio roughly in half.

Workplace Safety Tips for the Total Solar Eclipse

Posted on by

On August 21st, a total solar eclipse will be visible from North America for the first time in nearly 40 years. Many employers across the country will host viewing parties or may allow employees to take an extra break to observe the phenomenon, while those who employ outdoor workers can expect employees to have a front-row seat for the big event.

It is important to remember that such eclipses can expose workers to safety and worksite hazards, however. For example, outdoor workers should be sure to turn off any equipment or machinery before sun-gazing.

So what further information can employers pass on to reduce the risk of worksite and on-the-job injuries? NASA’s Total Solar Eclipse safety page suggests the following:

  • Never look directly at the sun.
  • If you are within the path of totality, remove your solar filter only when the moon completely covers the sun’s bright face and it suddenly gets quite dark. Experience totality, then, as soon as the bright sun begins to reappear, replace your solar viewer to look at the remaining partial phases.
    buy amoxil online pelmeds.com/wp-content/uploads/2023/10/jpg/amoxil.html no prescription pharmacy

  • Use eclipse glasses and handheld solar viewers verified to be compliant with the ISO 12312-2 international safety standard for such products.
  • Always inspect your solar filter before use; if scratched or damaged, discard it. Read and follow any instructions printed on or packaged with the filter.
    buy mobic online pelmeds.com/wp-content/uploads/2023/10/jpg/mobic.html no prescription pharmacy

  • Do not look at the sun through a camera, a telescope, binoculars, or any other optical device while using your eclipse glasses or hand-held solar viewer — the concentrated solar rays will damage the filter and enter your eye(s), causing serious injury.
  • Keep normal eyeglasses on, if normally worn, and place eclipse glasses over them.
    buy diflucan online pelmeds.com/wp-content/uploads/2023/10/jpg/diflucan.html no prescription pharmacy

Check out the map below to see if your business is in the path of totality for the upcoming eclipse:

total solar eclipse map