Loss Reduction The Other Part of Risk Control
 Nov. 18, 2010

The best way to control workers’ compensation costs is to avoid work related
injuries altogether. If no one gets injured on the job, there are no workers’ compensation claims and no workers’compensation losses. But, the reality is that with the exposures created by material handling, moving machinery and people in motion (all characteristic of manufacturing), there is an abundance of opportunities for your workers to injure themselves on the job.

Most employers and their insurance companies wisely place a great deal of emphasis on loss prevention. This a sound risk control practice, after all no one wants to see their employees injured. Companies will expend significant resources to
develop safety incentive plans, as well as, complete thorough inspections of their operations looking for hazards and potential injury producing activities. We in no way want to discourage these sound safety practices, but what happens after an injury occurs? What can employers and their insurance carriers do once there is a claim to control workers’ compensation costs?

To understand what insurance carriers can do we need to be aware of what they actually do now. For the most part, insurance carriers provide benefits in accordance with the California Labor Code and pay claim costs. They diligently ensure that they're in compliance with the laws governing claims practices in California. Many insurance companies that outsource claims management see this as an administrative process where there is little they can do to reduce the cost of a claim once it has occurred. Most insurance companies will make certain that there is appropriate medical care provided to the injured worker and wait for the doctor to release the individual back to work. A more progressive claims management operation may advocate early return to work programs or light duty programs to facilitate returning injured workers to work prior to them being at the point of maximum medical improvement and able to return to full duty. CMTA's workers’ compensation partner, CompWest, does things differently. They believe the claims management process is more than just providing benefits in accordance with the law. They approach claims management with a concern for the human beings involved in the process, your employees. Their approach, Workers’ Compensation With Care, is built on a foundation of solid communication between the injured worker, their employer and CompWest. The goal is to communicate to the employee that although you are injured, you are still a valuable part of the team and that their employer wants the employee back at work and contributing.

The Workers’ Compensation With Care approach to managing claims recognizes that there are many opportunities to reduce the potential cost of claims just by keeping employees informed and communicating that their employer is interested in their well being. The injured worker feels they have advocates and are less inclined to seek an attorney to represent their best interests. They feel cared for.

To effectively reduce costs, disability periods need to be reduced. CompWest’s "Keep At Work" program achieves that objective. While return-to-work programs emphasize working within the injured worker’s limitations, Keep At Work emphasizes the injured worker’s capabilities. Before the employee becomes rooted in their disability, they are back at work and contributing. They don’t view themselves as disabled, nor does their employer.

Workers’ Compensation With Care blends medical management, disability
management and litigation management into an overriding claims management strategy. While most insurance companies have outsourced much of their claims management, CompWest had invested in unique programs that reduce these claims costs. Lower workers’ compensation costs are the result when there is less litigation, better medical cost management and reduced disability periods. Workers’ Compensation With Care is achieving these results. CompWest’s medical cost savings is 14.5% better than the industry at a time when medical costs have risen 60% (over the past five years). Their litigation rate (claims where the employee seeks the services of an attorney) is 33% lower than the industry. Couple reduced
litigation with an effective Keep At Work program and you understand why CompWest’s average paid indemnity claim (disability payments to injured workers) is 34.8% below the industry average. The Workers’ Compensation With Care model produces a total claims payment 38% below the industry average. Does this sound like an advertisement? Perhaps it is, but CMTA is dedicated to serving the needs of California’s manufacturers and providing tools and programs that can help you control and reduce operating costs. Workers’ compensation is a significant cost for manufacturers. We want to make certain you take advantage of everything CMTA and CompWest have to offer you to help effectively manage this cost. For more information on workers’ compensation loss reduction contact CMTA Group Workers’ Compensation at (916) 498-3340 or e-mail us at wcgroup@cmta.net.


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