The severity and frequency of Workers’ Compensation claims has a direct bearing on the policy premium. The WCIRB uses both of these factors to determine the Xmod, and frequent small claims are a cost driver. Too many claims, or large claim amounts, can result in an XMod that increases the premium. Having a good claims history can result in an Xmod that reduced the premium. This is an incentive for businesses to provide a safe place of business and to help reduce or prevent claims.
As a business, how can you administer claim to keep the claim cost minimized?
Many companies do not have any procedures in place for workplace injuries or incidents. Small to medium size businesses often erroneously think that only large businesses need to have incident reporting plans and set procedures. No matter what size business you have, having a plan in place before any injuries occur is how businesses can effectively manage their claims.
What are the action steps for a Workers’ Compensation Claim?
All injuries, even minor ones, should be reported to the appropriate person. This can be a manager, a supervisor or the owner. An injury reporting plan is your first defense against managing claim severity and frequency. Untreated injuries can turn in to larger claims later, which is why all injuries need to be reported to the appropriate person to be assessed, treated and documented.
Your injury reporting plan should clearly define what an injured employee, or other employee, should do if another employee is injured. First aid stations or kits should be easily accessible. It is your duty to provide immediate medical treatment in the event of an injury.
If no first aid is required at the time of the injury, the injury still needs to be reported and documented fully for your records. Documentation is vitally important in the management of Workers’ Compensation claims. Not only should the time and nature of the injury be listed, but what the employee was doing at the time of the injury and what factors contributed to it. If possible, document the injury and the area where it happened with photos.
In addition to having the employee complete the incident or injury report, any witnesses should also provide their written statement relating to what happened. Statements should be taken as soon as possible and documented fully. This helps not only to provide a clear idea of what happened, but can help protect your business from fraudulent claims.
If the injury is severe, or the medical issue is beyond the scope of basic first aid, make sure that the employee is seen by a medical professional. Emergencies should necessitate a call to 911 without delay.
If the employee needs to see a doctor, but it does not require an ambulance, have a plan in place to get them to a hospital or clinic. Your injury procedures should include a plan of how to determine the severity and scope of the injury in order to easily determine if 911 should be called or if they employee should be taken to a clinic or emergency room, or if they are okay to take themselves.
Some states require that there is a designated doctor for injuries and illnesses that are work related. This information should be posted in a visible area along with the required postings for Workers Compensation that the states require. If the injury requires further attention, the employee needs to specify when they are seen that it is a work related injury when they arrive at the clinic, doctor or emergency room.
Usually, the sooner medical help is received, the better the treatment outcome and the claim costs are lower. Delaying getting medical help can increase claim costs in the long run. If an injured employee refuses medical help, make sure that refusal is documented as well.
Claims should be reported as soon as possible to your Workers’ Compensation carrier. Prompt reporting helps to mitigate the total cost of the claim. Carriers would like that all claims be reported but with claim frequency having an impact on the Xmod, it is a management call if first aid claims get reported or just documented. If you do not report a minor first aid claim to the Workers’ Compensation carrier, one of your written procedures should be to follow up with the employee and document the follow up.
If you do report a first aid claim, make sure that it is reported specifically as a first aid claim. First aid claims are usually closed quickly with only medical costs being reported and paid directly to the clinic.
Once you report the claim, give as much information as you have regarding the incident, first aid steps taken and where the employee was treated. All of the incident documentation should be sent along with the first notice of claim. Your Workers’ Compensation policy will have details on claims reporting.
What happens after I report a claim?
Once you report a claim, you can still take steps to minimize the total claim costs. To minimize time off work employers should have a back to work plan to accommodate injured employees. Light duty (modified duty) programs help lower overall claim costs by eliminating total disability payments. Make sure that the employee is medically cleared for light or modified duty before allowing them back to work.
Stay in contact with your employee to stay on top of their progress. You can establish procedures to check in with them weekly, or every few days, to find out how they are doing. Communication is a great tool, and employees should feel like they have an open line of communication with management. The goal is not to pressure them to come back to work, but to make sure they know that they are valued as an employee and their wellbeing matters.
Work with them to establish a return to work timeline and what work restrictions to expect when they come back. This will help you create a light duty plan to accommodate their injury or illness. Make sure that they get their medical restrictions in writing so you can have documentation for the file.
As with any type of claim, documentation is important. With Workers’ Compensation claims, not only are their immediate medical costs, but they involve reserve amounts that are set aside. By taking steps to minimize injuries, and to immediately handle them, companies can help claims cost be lowered by having clear lines of communication to get their employees back to work, even with light duty.
In addition to having an injury reporting plan, it is also recommended to have an accident investigation plan. In the event of an accident, it should be investigated as to what caused, or contributed to the injury, and what steps can be made to prevent it from happening again.