A Complex Beast – The Complexities of the Workers’ Compensation system and the Impact of not getting it right
The Workers’ Compensation system in Australia is one that is extremely complex, with different requirements under each state’s legislation and variances between the different insurance schemes. Confusing right? If you find yourself scratching your head when it comes to workers’ compensation, don’t worry you’re not the only one!
To stay ahead of the curve and keep workers’ compensation costs to a minimum, organisations need to have a comprehensive understanding of how the system works, how to reduce costs and how to effectively manage claims.
We sat down with Rhys Cooper to chat about his experience within the workers’ compensation space and to find out how we can better manage claims in the workplace.
Rhys, the world of workers’ compensation and claims management can be extremely complex and difficult to manage. What are your top three tips to for effectively managing claims in the workplace?
Really great question. One of the most important tips is to ensure that you have a strategy for each and every claim i.e. understand the prognosis, diagnosis, RTW goals, treatment, etc. It’s important that you document your strategies with required actions and delegate responsibilities so that your insurer/claims agent understands the next steps and can assist you in preparing your record of accountability. Essentially you should be driving the claim, rather than your case manager taking the lead.
Secondly, communication and obtaining information is key to achieving a successful outcome. The more information (medical or factual) you can collate, through having open dialogue with the injured worker, their treating practitioners (where possible) and your claims agent the better. This information will allow you to move quickly to ensure the strategy you have in place works whilst also enabling you to keep the lines of communication open between all parties. All information is valuable, regardless of how straightforward you think the claim initially appears.
Finally, you should develop an understanding of how the given claim costs may or may not impact your premium. Is the claim currently premium impacting and if so, what decisions by you or the insurer/claims agent could minimise claims costs? As an example in Victoria, minor claims are non-premium impacting – that is, the first 10 days of time lost and first $692 of medical expenses on a claim will keep the claim minor and not part of your claims experience.
In your experience, what are some of the common mistakes employers make when managing workers’ compensation claims?
The most common mistake is simply not realising how much of a role you can play through your interactions and correspondence with the injured worker. Often the best outcomes are achieved through clear and ongoing communication, collaboration and regular consultation with the injured worker. It is as simple as picking up the phone or inviting a worker back into the workforce after an injury to ensure that he/she is kept informed and always understands the next steps
On too many occasions I have witnessed employers ceasing communication with an injured worker after an incident or claim, which leads to a disengaged employee and subsequently, poor RTW outcomes. Ensuring open communication line for updates with prognosis, diagnosis, RTW timeframe and consultation with the claims agent will ensure everyone is on the same page and working towards the same goal.
The other common area of weakness, is a lack of understanding surrounding what actions and situations drive and influence workers’ compensation premiums (i.e. time lost). Having a comprehensive understanding of how premiums and claim costs are calculated along with an understanding around what you can and can’t influence is key to achieving positive RTW outcomes and reducing overall premium costs.
Why is financial claims management so poorly understood?
In my experience, it’s a combination of the regulators and legislators adopting a complicated premium calculation model with a lack of transparency around the factors that drive a good performing employer, compared to a poor performing employer. I often find that challenges occur when employers are trying to understand how case estimates are calculated and how claims can vary for what seems like a similar injury profile. The complicated area of premium and claims costs often results in an employer commenting “it’s too difficult to understand, I can’t do anything to change my performance so I’ll just get the bill and pay it”.
Another avenue that some employers decide to take is leaving the sole responsibility of managing the claim up to their insurer/claims agent and therefore, claims costs through treatment or compensation of time lost can quickly increase with little oversight and control.
What skills will people gain from attending your up and coming financial claims management seminar.
The seminar will provide practical claims management skills and tips on how to not only manage claims to achieve the best result for the injured worker, but also how claims costs and financial components can be influenced to achieve an optimal premium result.
A key component of the seminar is the discussion surrounding the 10 principles of Financial Claims Management. These principles have been developed to ensure that they are applicable to all claims management situations, no matter the state or jurisdiction.
I recommend the seminar for those who manage or have a responsibility for workers’ compensation claims and want to gain control over their performance.