Effective management of workers’ compensation claims involves prompt investigation, thorough documentation, timely reporting, and active management.
By Michelle Namisniak, Tom Sayre, & Brett Findlay
Managing workers’ compensation claims can be daunting. There are some key items to be aware of in order to effectively work through this process. With the state’s revision to the rating formula for the Experience Modification Rate (EMR) in 2022 and evolving trends in the claims world, workers’ compensation claims are having a significant impact on businesses. Variables like this make it even more important to pay attention in the unfortunate event of a claim. This article outlines the essential steps employers should take following a workplace accident to ensure the best possible outcome for their business.
Immediate Response to an Accident
When an accident occurs, the first step is to investigate the claim thoroughly. This involves gathering detailed information about the incident, including the who, what, where, when, and how. It’s crucial to ask as many questions as possible early on to capture accurate details before memories fade or stories change.
Key steps include:
- Interviewing the injured employee: Ask specific questions about what happened, how it happened, and where it happened.
- Examining the accident site: Verify any claims about broken equipment or hazardous conditions.
- Identifying witnesses: Speak to coworkers immediately to get their accounts before they have a chance to discuss the incident among themselves.
Documentation
Proper documentation is vital in managing workers’ compensation claims. Employers should use incident reports to record all relevant details. If an incident report is not immediately available, have the employee write a statement or write it for them and have them sign it. This creates a paper trail that can be crucial if the claim is later disputed.
Important documentation practices include:
- Detailed incident reports: Ensure they cover the who, what, where, when, and why. The injured employee needs to sign and date the document.
- Specific injury details: Clearly document the body part or parts injured to minimize the potential for the claim to evolve and include other sites.
- Witness statements: Collect and have witnesses sign their statements immediately. Try to secure a phone number, home, and email addresses for the witness.
Reporting Process
Employers must document and maintain a record of any injury or illness for 18 years. The injury or illness must be reported to the insurance carrier (and the Board) within 10 days of the disability or employer knowledge of disability—defined as lost time or restricted duty—if there is more than one day of lost time beyond the shift when the injury occurred or if medical treatment extends beyond first aid.
Steps in the reporting process:
- Timely reporting: Ensure the claim is reported to the insurance carrier within the mandated timeframe to avoid penalties, and to provide time for the carrier to investigate the loss. Reference New York form C-2F (Employer’s First Report of Work-Related Injury/Illness) for information the carrier will need. Contact your broker if you are uncertain how to report a loss.
- Share your concerns: If you question a loss or there are details which seem important which are not addressed in reporting, let the carrier know you would like to be contacted to discuss further. When the carrier contacts you, it is appropriate to share your concerns with them.
- Let the employee know you have reported the loss. If a claim number is provided by the carrier, share that with the employee. Medical providers will request this information at the time of treatment.
- Involve risk management: Reporting losses helps identify and address potentially hazardous situations and avoid future incidents.
- Electronic Data Interchange (EDI): Understand that state-mandated EDI reporting requires timely and accurate submission to avoid penalties.
Components of a Claim
A workers’ compensation claim typically includes several components:
- Indemnity: Payments for lost time, which can be a temporary closed period of lost time or a schedule loss of use (SLU) award or Loss of Wage-Earning Capacity (LWEC) award for permanent injuries.
- Medical expenses: These are lifetime expenses and can increase annually due to rising average weekly wages and fee schedules.
Active Management of Claims
Active management of claims is crucial for minimizing costs and ensuring a positive outcome. Employers should:
- Provide prompt medical attention: This helps the injured employee recover quicker and return to work, even in a limited role, which can reduce the overall cost of the claim.
- Engage in proactive communication: Keeping open lines of communication with the injured employee can foster a sense of loyalty and reduce the likelihood of litigation. Set the expectation that employees inform you and provide documentation of their medical examination dates and status after each appointment. Failure to do so may jeopardize their workers’ compensation benefits and perhaps their employment status. Share the medical status information with your carrier.
- Inform your carrier when an employee’s work status changes (out of work, returns in a transitional duty capacity, returns full duty, etc…)
- Update your carrier with any relevant developments you become aware of, i.e., employee is unable to work but is still participating in outside activities, etc. Don’t assume the carrier shares your knowledge.
- Complete the forms! Yes, there are many. Yes, they are cumbersome. However, if they are not completed fully and accurately, you will be asked to do them again. If you do not, penalties and adverse findings will follow. Do it right and do it once! (If you have questions on how to complete, ask your broker before you submit)
In Summary
Effective management of workers’ compensation claims involves prompt investigation, thorough documentation, timely reporting, and active management. By following these steps, employers can mitigate the impact of claims on their business and ensure compliance with state regulations. Proper handling of claims not only helps in reducing costs but also supports a safer workplace environment.
If you have any questions or need further assistance, please do not hesitate to reach out to OneGroup’s team for guidance and support.
This content is for informational purposes only and not for the purpose of providing professional, financial, medical or legal advice. You should contact your licensed professional to obtain advice with respect to any particular issue or problem. Please refer to your policy contract for any specific information or questions on applicability of coverage.
Please note coverage can not be bound or a claim reported without written acknowledgment from a OneGroup Representative.