How faster workers’ compensation claim reporting can reduce costs
It pays to be speedy in your workers’ compensation claim reporting. Conversely, the longer your insurance client waits to report a work injury, the more expensive that injury is likely to be. American Claims Management found that when a workers’ compensation claim was reported more than 10 days after the event, costs rose by 60 percent on indemnity claims and 64 percent on medical claims.
A 2015 study by National Council on Compensation Insurance, Inc. (NCCI), as reported in Business Insurance, confirmed our findings: delayed injury reporting, it said, can increase comp claims up to 51 percent. The spike in costs for claims reported later may be caused by injured workers seeking attorney assistance with their claim, the report said. Attorneys were involved in nearly 13 percent of claims made the same day as the accident, versus nearly 32 percent when claims were made four or more weeks later.
Related: How can you improve your client’s insurance claim experience?
How fast filing of a work comp claim helps your client
1. Get the evidence. The sooner the incident is reported, the faster you (and your claims investigator) can interview witnesses and collect evidence, and the more accurate your investigation will be. A couple of weeks after the incident, witnesses forget what they saw and the chain of events.
This is key not only in your workers’ compensation claim reporting but also in your risk management, to help you assess the situation and determine what additional safeguards need to be enacted. Additionally, if there’s anything about the claim that you choose to dispute, you’ll be glad to have this early evidence.
2. Ease employee concerns and reduce potential for litigation. Reporting the injury as soon as possible also works to ease the injured employee’s concerns, as your client is immediately providing medical care at their expense, along with explaining how the injured person will receive additional care and wage replacement payments if need be – fears that could otherwise lead them to seek attorney representation. Immediate medical care could also result in less costly physical therapy versus surgery, should the injury continue unchecked for a matter of days or weeks.
3. Safeguard employee morale. If employees know your client isn’t reporting the claim or making proper moves to protect the injured worker and guard against any future repeat of the incident, they’ll have disgruntled employees on their hands. That problem will only escalate. Making it clear that the injured worker is receiving the medical care they need often results in his or her being willing to return to work more quickly, even in a light duty role.
Related: How you can prevent workers’ compensation fraud
How to reduce the lag time for workers’ compensation claim reporting
Few employers have trouble reporting a more serious work comp claim, because the injured worker obviously needs immediate care, and it’s clear when and where the injury occurred. It’s those smaller claims that typically go unreported at first, where the employee seems to be fine and can initially shake off the incident. Here are a few tips to consider:
- Discuss and encourage early reporting with your clients.
- Ensure their supervisors and employees understand how to report an injury and who their point of contact is (along with a back-up person). At the same time, assure employees that your goal in the event of an injury is to help them return to work as quickly as they’re able, showing your long-term commitment to them.
- Make certain that supervisors know how to use their incident report. Encourage your work comp clients to conduct brief five-minute trainings during staff meetings to walk through the report, explaining what information is needed and the importance of being detailed.
- Remind clients that if they enact strict workers’ compensation claim reporting deadlines, they shouldn’t punish employees for reporting “late” if they genuinely may have thought the injury would heal itself. This may push the employee towards hiring an attorney; instead, review these on a case-by-case basis.
- For a minor incident that doesn’t look like it will become a full-blown claim, it’s still best to report it in “report-only” mode, which alerts us to the accident without turning it into a formal claim. This actually protects you if and when it does become a more serious claim.
Reporting an injury within 24-48 hours is optimum, experts agree. Our collective goal – your carrier’s, Valiant’s, ACM’s and your own – is a speedy recovery for an injured worker, and prompt reporting gets us all on that road to recovery much faster.
Related: How to create an effective loss control program
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Work Comp Lag Time
This article first appeared in Arrowhead’s Tribal blog. It has since been edited and revised to better fit the needs of Valiant’s producers and their clients.