When we visit employers, they sometimes share with us news of an upcoming claim review. Most times it’s the obligatory six month claim review with the employer. The claim review is usually initiated by the third party administrator or insurance carrier and the goals and objectives are vague. Meanwhile, back at the TPA office, the file clerk has pulled the majority of the employer’s indemnity files and piled them in a conference room. The claims examiner will spend the week in the conference room top sheeting and sprucing up the claim file in order to make a good impression and provide the employer with basic first aid remedies for their growing inventory. Many times there are no goals or objectives for these reviews and employers use them solely to get an update as they have entrusted the TPA with “handling ” their millions of dollars of reserve monies. I write about this to illustrate the reactive approach usually employed by insurance carriers and TPA firms.
Let’s try this scenario on for size: You, the employer, make clear that the employer (you), will be reviewing your claims on a quarterly basis. Knowing you have every right to, you make clear the goals and objectives of your workers compensation claims program and your expectations. In other words, you emphasize the fiduciary responsibility of the TPA in handling the workers compensation claims of your injured employees. Fast forward six months. You have documented the progress and challenges of the claims being handled by the TPA. In that time you have devised a collaborative team; nurse case manager, workers comp attorney, broker, risk manager and of course the TPA. You go over reserve adequacy, litigated claims, non-litigated indemnity cases, medical-only files and of course, legacy claims. The team will sometimes include key front line managers or safety personnel, because you’re not just discussing existing claims, you’re strategizing, in order to avoid a pattern of claims or to optimize the Return to Work program.
The biggest failure with employers in their workers comp program is accountability. Failing to hold the TPA accountable can lead to a serious breach of trust or of the Fiduciary Responsibility of the TPA or carrier. Accountability is established at the onset of the contract and maintaining an active role in the administration of claims or prevention of injuries is of utmost importance.