Transcript Slide 1

Summit County Safety Council
August 18, 2010
SUCCESSFUL STRATEGIES FOR
CONTROLLING WORKERS’
COMPENSATION COSTS
By Hans A. Nilges, Esq.
Morrow & Meyer LLC
6279 Frank Avenue NW
North Canton, OH 44720
330-433-6000
E-mail: [email protected]
Copyright 2010
PART ONE:
COMMON MYTHS AND
MISCONCEPTIONS ABOUT OHIO
WORKERS’ COMPENSATION
Things You Need To Know But
Nobody Will Tell You.
Myth No. 1:
The Ohio Workers’ Compensation System is
in great shape.
Reality:
The Ohio Workers’ Compensation System is
a mess and it continues to drive companies
out of business and/or out of state…why?
1. Gradual Liberalization of the
Workers’ Compensation System
by Ohio Courts
EXAMPLE:
Schell v. Globe Trucking, Inc. (1990), 48
Ohio St. 3d 1 (Claimant not required to
prove “substantial” aggravation for claim to
be compensable)
- An aggravation, no matter how slight,
is compensable!
RESULT: A CLAIMANT’S BONANZA!
2.
Bureaucratic Complacency
3. Increased Pressure from Doctors and Injured
Workers to Push Costs of Non-Occupational
Illnesses onto the Workers’ Compensation
System.
Myth No. 2:
Workers’ Compensation Is Just Another
Form of Insurance
Reality:
It is much more than that! The Ohio
Workers’ Compensation System offers a
veritable cornucopia of benefits and legal
protections that are not available under
traditional employee insurance programs.
The Horn of Plenty
1.
2.
3.
4.
Temporary Total Disability (TTD)
Permanent Partial Disability (PPD)
Wage Loss
Permanent Total Disability (PTD)
5. Lifetime Health Care for Allowed Conditions
6. Additional Allowances
7. Violation of Specific Safety Requirement
Awards (VSSR’s)
8. Job Protection (R.C. 4123.90)
Myth No. 3:
Workers’ Compensation
Fraud Is Rare
Reality:
Approximately one-third of
all Workers’ Compensation
claims involve some form of
fraud or abuse
Myth No. 4:
Workers’ Compensation Hearings Are Non-Adversarial
Reality:
Workers’ Compensation hearings can become very
contentious, especially when the injured worker has
hired a lawyer
Myth No. 5:
Workers’ Compensation Hearings Are Fair and
Impartial Proceedings That Do Not Favor One
Party Over the Other
Reality:
The system is run for the benefit of the injured
worker. Workers’ compensation laws are
construed liberally in favor of the claimant (See
R.C. 4123.95)
Myth No. 6:
Your Company’s Interests Are Adequately
Protected by Your Third-Party Administrator
Reality:
Third-Party Administrators (TPA’s) provide
useful services but they are limited in what they
can do for you…. Why?
1. TPA’S CAN’T PRACTICE LAW
Cleveland Bar Assn. v. CompManagement, Inc.
104 Ohio St.3d 168 (Dec. 15, 2004)
SYLLABUS OF THE COURT
Non-lawyers who appear and practice in a
representative capacity before the Industrial
Commission and the Bureau of Workers’
Compensation in conformity to Industrial
Commission Resolution No. R04-1-01 are not
engaged in the unauthorized practice of law.
INDUSTRIAL COMMISSION
RESOLUTION NO. R04-1-01:
Third Party Administrators may not:
1.
2.
3.
4.
Examine/cross-examine witnesses;
Cite, file or interpret statutes, rules or cases;
Make or give legal interpretations regarding the
evidence;
Comment upon the evidence;
5.
6.
7.
Provide legal advice;
Give or render legal
opinions before, during
or after, certification of a
claim;
Provide stand-alone
representation at
hearings by charging a
fee specifically
associated with such
representation.
Myth No. 7:
The Most Cost Effective Way to Control
Workers’ Compensation Claims is to Focus on
Problem Claims After They Become a Problem
Reality:
The most cost effective strategy is to control
costs up front…. Why?
PART TWO:
THE ANATOMY OF THE
RUNAWAY CLAIM
Anatomy of the Runaway Claim
1. Employee claims minor injury (e.g. minor
LB sprain), and a claim is filed
2. Claim is allowed without investigation
and TT is started (usually allowed for
minor condition, e.g. LB sprain)
Anatomy of the Runaway Claim
3. Employee fails to return to work after 3
months
4. Company/TPA begins process for finding
employee to be MMI (thus terminating
TT)
5. Employee reacts by seeking additional
testing (e.g. MRI) and/or filing motion for
additional allowance (e.g. herniated disc)
Anatomy of the Runaway Claim
6. Company/TPA grants additional
allowance (usually no investigation)
OR
fights additional allowance but loses
(no investigation/bad IME report)
Anatomy of the Runaway Claim
7. Claim is now recognized for the more
serious (i.e. more costly) condition
8. Employee requests surgery and physical
therapy and Company/TPA grants
request (no choice at that point)
Anatomy of the Runaway Claim
9. Employee takes > 6 months to recover
from surgery
10. Company/TPA files second motion to
terminate TT and recommends getting
an attorney involved.
TOO LATE!
PART THREE:
HOW DO YOU STOP THE
RUNAWAY CLAIM?
BE PROACTIVE:
ADOPT THE TEN KEY
ELEMENT STRATEGY –
IT WORKS!
WHAT ARE THE TEN KEY
ELEMENTS OF AN EFFECTIVE
WORKERS’ COMPENSATION
PROGRAM?
1. ASSUME PRIMARY RESPONSIBILITY
FOR YOUR WORKERS’ COMPENSATION
PROGRAM
2. CONTROL COSTS UP FRONT
(Don’t Wait Until It’s Too Late!)
3. OBTAIN DETAILED INFORMATION
ABOUT THE CLAIM
Injury Reports
1. Should be signed and dated by the injured
worker
2. At a minimum, it should request the following
information:





description of injury and accident;
time the injury occurred;
list of witnesses and their location at time injury
occurred;
specific area of body affected; and
list of prior injuries and prior claims involving
the same body part
4. OBTAIN DETAILED INFORMATION
ABOUT THE CLAIMANT
a. Obtain a Medical Authorization and a List
of Medical Providers
b. Conduct an Immediate and
Thorough Accident Investigation
c. Obtain and Review Medical Records
d. Review Prior Claims and Company
Medical/Personnel Records
5. FIGHT FRAUD AND ABUSE
EXAMPLES OF FRAUD AND ABUSE

Claimant receives disability compensation while
working elsewhere.

Claimant is Able to Work but Won’t

Claimant is Hurt Outside of Work

Claimant Fails to Disclose Prior Injuries and Treatment

Natural Deterioration

Work Activities are not a Causative Factor
6. Raise Legal Defenses
Legal Defenses
a. Claimant is Ineligible for TT
b. Accident occurred through fighting or horseplay
c. Aggravation of Pre-Existing Occupational Disease
d. Idiopathic Injuries
e. Injury Occurred Outside the Scope of Employment
f. Injured Worker was under the influence of alcohol or
drugs
7. AGGRESSIVELY DEFEND
AGAINST ILLEGITIMATE
CLAIMS
a. Effective Independent Medical Exams
(IMEs)
b. Utilize Private Investigators
c. Effective Use of Legal Counsel
 cross-examination
 subpoena information and witnesses
 legal arguments and defenses
8. ACTIVELY MONITOR ONGOING
CLAIMS
a. Review medical bills (for non-allowed
conditions)
b. Fight additional conditions
c. Fight excessive PPD awards
d. Termination of TT (MMI or treatment for
non-allowed conditions)
e. Settle Old Claims
9. TAKE ADVANTAGE OF COSTSAVING OPPORTUNITIES
a. Group Rating
b. Light duty
c. Salary continuation/first $15,000 medical
program
d. Drug-Free workplace program
e. Handicap reimbursement
f. Subrogation
g. Safety Council Incentive Program
h. Develop and implement an effective safety
program
10. WHEN IN DOUBT JUST SAY NO!
CONCLUSION