The Front Line for Cost Containment

By James Malone and Luis Ramos

Claim reporting is the one event that sets the tone for the entire claims management cycle, and making improvements to this first step can have a ripple effect on all other cost containment efforts. In a 2000 study of workers’ compensation claims by The Hartford, for example, claims that were resolved within a week of reporting cost as much as 45% less than claims that took longer.

Every organization should scrutinize their claims reporting process to determine if current procedures could better contribute to minimizing expenses. As you evaluate your own claims reporting procedures, there are several key features to bear in mind.

Simplicity. Firms should use a simple, flexible reporting process that is convenient for all employees. Plant safety managers may prefer to use a web form for reporting, while the fleet driver will need to use the telephone. Field personnel should be able to report via the web, phone or fax—or a combination of all three.

Accuracy. Incoming claims should be verified by comparing the information entered into the report to the required information and by flagging any information that remains missing prior to the end of the initial report. Performing quality control during initial reporting sets the stage for efficient handling of the entire claims management process.

Dynamic interview scripting. The scripts used to receive claims reports should be flexible enough to add or skip questions based on information gathered during the call so that any influential information is thoroughly documented. Documenting instances of collateral damage is especially important as it saves adjusters from having to forage for them later on.

First medical intervention. The claims intake process can begin the return-to-work process itself by guiding injured employees into PPO networks and by triggering physician authorizations when an injury is first reported.

Instructions to callers. Employees should be informed of recommended next steps based on information gathered during report intake. If an employee is reporting an accident, instructions should include directions to secure the scene. If the situation indicates that the company may have liability issues, instructions should refer to the required documentation needed to protect the company.

Escalation process. There should be a reliable escalation process in place that field adjusters, field case managers and corporate safety managers can follow immediately after a catastrophe.

Information delivery. The claims intake process should automatically disseminate information among its key players, such as TPAs, insurance carriers and managed care providers.

Data synchronization. In an organization where location drives available coverage, PPO referrals, the proper distribution of reports, frequent data feeds of this information can streamline the reporting process while also improving accuracy. The interviewer can pre-populate the claim with the employee’s location, coverage specifications and physician referral information based on social security number.

Companion reports. An incident involving injuries to several different employees will require filing several reports with highly repetitious information, such as location number, contact information or date of incident. One way to improve the process is by automatically entering repetitious information like the claim’s date and time.

Safety/loss control. The reporting process should automatically notify safety or loss control representatives so they can address hazards before others get hurt.

Capture near-miss information. When faced with a major incident like a chemical spill or a workplace death, were there any warning signals that could have prevented the incident? Having location managers report near-miss incidents helps isolate policies and procedures that can be improved to prevent future accidents.

Analysis of RMIS feeds. Feeding all types of incident data to RMIS can isolate the issues that are driving up costs, flag trends that are either regional or driven by the nature of a certain job within the organization and jumpstart ways to address those trends.

James Malone, ARM, CPCU, is chief executive officer of The Network, Inc., a provider of claims reporting services based in Norcross, Georgia. Luis Ramos is The Network’s vice president of risk management services.