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5 Benefits of Prompt WC Insurance Claims Reporting

Posted by David Ross on Sun, Oct 25, 2020

Promptly filing your workers comp claims can help lower your WC insurance costs.You’ve purchased the appropriate Workers’ Compensation (WC) Insurance, as required by Pennsylvania law. That’s a significant first step to protecting your employees and your business, but there’s more to a healthy WC program, including the prompt reporting of injuries and claims.

We understand that you have a lot on your plate and may wear many hats, but not reporting a claim promptly can have a negative impact on your WC program, your business, your injured employee, and your worker's comp insurance costs.

5 Reasons Prompt Reporting of Workplace Injuries and WC Claims is Crucial to Your Business

Preserve Evidence

When an injury occurs, it’s essential that the injury is investigated as quickly as possible, or you could risk losing crucial evidence. Therefore, as soon as an injury occurs, someone should document details of the injury, investigate to try to determine how the injury occurred, interview the employee and any witnesses, and of course, ensure that the injured employee receives appropriate medical attention.

Lower Cost of Claims

The National Council on Compensation Insurance (NCCI) found that the median cost of WC insurance claims that were reported between one day and two weeks were “significantly lower,” and the cost rose as the time it took to report a claim rose. The bottom line is that delayed reporting can increase WC claim costs up to 51%.

Better Medical treatment

When an injured employee receives prompt medical treatment from competent, in-network healthcare providers, they are more likely to receive a proper diagnosis and effective treatment to heal faster.

Plus, even seemingly minor injuries can escalate into more significant issues if they are not immediately looked at by a medical professional.

Quicker Return to Work

The sooner you can get an injured employee back to work safely, the better it is for everyone – the injured employee, co-workers, and your business. Having a return to work program can shorten the length of time an injured worker is out of work by an average of 3.6 weeks, according to the RAND Institute for Civil Justice.

Health providers who are familiar with treating workers’ compensation injuries will focus on facilitating an early return to work for the injured employee. The sooner the injury is reported, the sooner that process can begin.

Decrease in Litigation

Promptly reporting an injury and keeping in touch with the injured employee throughout the claim process helps reduce employee’s fears and makes them feel as if their employer cares about them and is treating them fairly. According to NCCI research, this all translates to a lower chance of litigation.

Fraud Prevention

According to the National Insurance Crime Bureau (NICB), “Workers’ compensation claimant fraud and medical fraud are significant contributors to our nation’s annual $30 billion insurance fraud problem.”

Prompt reporting of an injury helps ensure 1) the injured worker receives proper medical treatment, 2) the injured worker feels they’ve been treated fairly, and 3) allows a better investigation of the incident. All this helps minimize fraud.

Quicker Closure

The longer a claim remains open, the more resources you have to use. Promptly reporting an employee injury can get an employee back to work and the claim closed more quickly.

Safer Workplace

When an injury is reported and investigated quickly, you are more likely to recognize safety issues, correct them, and ensure the safety of your employees.

One More Step: Lower Workers Compensation Insurance Costs

If you want to learn more about how to get the lowest cost on WC Insurance and other commercial insurance, give the independent agents at American Insuring Group a call at (800) 947-1270 or (610) 775-3848 or connect with us online. We shop and compare competing insurance carriers to get you the best rates on quality insurance protection. Call today.

Tags: Workers Compensation Insurance, PA Workers Compensation Insurance, workers comp costs, Workers Compensation Insurance Fraud

Telecommuting and Workers’ Compensation Insurance

Posted by David Ross on Sat, Oct 10, 2020

Telecomuting can impact your workers compensation insurance costs in Philadelphia, Berks County, Lancaster County, Alleghany County, PA and beyond. Here's what you should know.If the COVID-19 pandemic has forced many of your employees to work from home, have you considered the ramifications it may have on your Workers’ Compensation Insurance? It may not be high on your radar as you continue to struggle through all the logistics of staff working from home, but it should be.

Workers’ Compensation claims can be complicated enough. If that injury occurs while the employee is at home, it can complicate it even further. The Society for Human Resource Management states, “In general, an employee injury or illness is compensable under workers’ compensation if it arises out of and in the course of employment, regardless of the location the injury occurs.”

Due to 1) a lack of defined case law in this area and 2) the limited ability to investigate incidents that occur at home, telecommuting is creating WC issues for many employers.

Injuries can and do occur while employees are working from home. Therefore, you must do your best to ensure that…

  • Employees have a safe work environment even if they are working from home

  • Both you and your employees understand what is expected of them

  • You respect their rights

  • Employees receive appropriate medical attention if an injury “arises out of and in the course of employment”

  • You have a process in place to properly investigate work injuries that occur at home.

The best way to ensure this and avoid potential WC issues is to create a Telecommuting Policy before something does happen.

A Telecommuting Policy

A Telecommuting Policy forces you to address the potential risks of working from home and lets employees know what is expected of them. Create and implement a written work-at-home contract that is signed by both employee and employer and is strictly enforced.

This contract should do the following:

  • Outline the hours that an employee will be working, including meals and rest periods. Also, include provisions regarding overtime. If the schedule changes, it should be documented via email.

  • Define where the employee will be working, whether that’s his or her home address or another physical location they chose to work from. Define the specific work area(s) within the home or other location and provide training to help them set up a safe workstation. If it is possible, check an employee’s home office to identify potential safety hazards and how to eliminate them.

  • Discourage employees from performing personal activities in their at-home workspace.

  • List what employer-owned equipment – such as laptop computers – the employee can use outside of the workplace.

  • Describe how employees should store and dispose of sensitive information.

  • Include details about how any work-related injury investigations will occur. You need to respect your employee’s privacy, but you also have the right to do an investigation of any work-related injury. Specific language is key. Require the employee to state in writing that they understand that their home-work environment must be safe and that they need to cooperate if a work-related injury occurs. That includes seeking medical treatment if needed, documenting the injury, and allowing the employer access to the workspace during regular business hours.

  • Include a Workers’ Compensation Statement that informs the employee of their protection under WC laws and that they are responsible for reporting all work-related injuries promptly.

Our Experts Will Help You Save on Workers’ Compensation Costs

Ensuring the safety of your employees and having a process to investigate injuries that occur at home can help you save on Workers’ Compensation costs.

Another great way to save is to work with one of the independent insurance agents at the American Insuring Group. We specialize in WC insurance and will compare pricing and coverage among many competing insurance carriers. We research so you can save! Give us a call at (800) 947-1270 or (610) 775-3848 or connect with us online.

Tags: Workers Compensation Insurance, workers comp, workers comp costs

Workers Compensation Basics: What Employers Need to Know

Posted by David Ross on Sat, Sep 26, 2020

The basics on reducing the cost of workers comp insurance in Philadelphia, Lancaster, Pittsburgh, Erie, Allentown, and throughout Pennsylvania.One of the most important types of insurance that almost every business needs is Workers' Compensation Insurance (WC). It helps protect both employees and employers when there is a work-related injury or illness. In Pennsylvania, most employers are required by law to carry WC for their employees.

For many employers, WC is one of the most expensive types of insurance they need to carry, which is why working with an insurance agent who has experience with WC – like those at American Insuring Group - is essential to keeping those costs as low as possible.

They say knowledge is power, so here are the basics every employer should understand about Workers' Compensation Insurance.

What is Workers' Compensation?

If a worker is injured in the workplace or becomes ill because of his or her work environment, Workers' Compensation helps cover medical costs and lost wages if the employee is not able to work. It doesn't matter who or what caused the injury – a faulty machine, the employee, a co-worker, etc. - WC will pay those expenses.

In Pennsylvania, WC covers health care expenses (doctor's visits, surgery, etc.), ongoing care (such as physical therapy), illnesses, repetitive injuries (such as carpal tunnel syndrome), partial or total disability payments, permanent injury payments, and death benefits.

WC also benefits the employer by limiting an injured employee's right to sue an employer directly for damages that injury or illness causes.

Who is Required to Carry Workers' Compensation?

The Department of Labor & Industry states, "If you employ workers in Pennsylvania, you must have workers' compensation insurance -- it's the law." This includes both full and part-time employees, even if they are family members.

The only exceptions are If ALL employees fall into one or more of the following categories:

  • Federal workers
  • Longshoremen
  • Railroad workers
  • Casual workers
  • Persons working out of their own homes or other premises not under the control of management
  • Agricultural laborers making less than $1200 per calendar year
  • Domestic workers who have not elected to come under the provisions of the Workers' Compensation Act
  • Sole proprietors or general partners
  • Those who have been given an exemption by the Department of Labor and Industry due to religious beliefs
  • Executive officers who have been granted exclusion by the Department of Labor and Industry
  • Licensed real estate salespersons or associate real estate brokers affiliated with a licensed real estate broker or a licensed insurance agent affiliated with a licensed insurance agency, under a written agreement, remunerated on a commission-only basis and qualifying as independent contractors for State tax purposes or for Federal tax purposes under the Internal Revenue Code of 1986.

If a business does not qualify for one of these exceptions, it must carry Workers' Compensation Insurance for its employees. Failure to do so can result in the employer being required to pay back any costs paid by the Uninsured Employers Guaranty Fund or a work-related injury or illness, including interest, penalties, and fees. An uninsured employer may also face civil and criminal risks that can result in fines and imprisonment.

How Much Does Workers' Compensation Insurance Cost?

How much you pay for WC is based on a formula:

RATE x (PAYROLL/100) x EXPERIENCE MODIFIER = PREMIUM

An employee's classification code determines the RATE. Those codes are based on the likelihood of that employee being injured on the job. Employees doing more dangerous jobs, such as construction workers, will have a higher rating than someone in a less dangerous job, such as office workers.

A projection of your payroll determines PAYROLL.

Your business's loss history determines the EXPERIENCE MODIFIER compared with the average loss history in your industry. An experience modifier of one is average. A lower number will reflect a better than average loss history, and a higher number will reflect a loss history that is worse than the average. The lower your experience modifier number, the lower your WC rates. 

 

How Can You Lower Workers' Compensation Insurance Costs?

An independent insurance agent who specializes in WC - like those at American Insuring Group – can help ensure you pay the lowest premium possible. By searching among many competing insurance carriers, we obtain the right insurance at the lowest price possible. So give us a call at (800) 947-1270 or (610) 775-3848 or connect with us online.

 

Tags: Workers Compensation Insurance, workers comp insurance, PA Workers Compensation Insurance, workers comp costs

8 Tips to Lower Contractors Insurance Costs

Posted by David Ross on Sat, Aug 29, 2020

lower_contractors_insuranceContractors need to carry certain types of Contractors Insurance to protect themselves, their business, and their employees, and many contracts require specific insurance coverages.

But that doesn’t mean you have to pay higher premiums than necessary. There are ways to lower your premium costs without affecting your coverage. Here are eight tips to help you lower your insurance premiums.

Increase Deductibles

If you have financial reserves that would allow you to assume some additional risk, you can increase your deductibles to reduce your premiums. If the difference in the premium is enough to cover the deductibles on one or two claims, it probably makes sense to make the change - IF you have money available to pay the higher deductible in the event of a claim.

Review Your Policy

Over time, things change in your business. You may need to hire an additional employee or let one go. You may purchase a new vehicle or sell an older piece of equipment. Your current insurance should reflect your current circumstances.

Let your insurance know about these changes and review your policy at least once a year to make sure that you have proper coverage AND that you are not paying more than you need to.

Bundle

You probably need more than one type of insurance. For example, Commercial Liability Insurance helps protect you if a third-party sues you (and is a requirement in most contracts); however, Workers’ Compensation protects your employees and your business if an employee is injured on the job (and is required by law). Many insurance carriers will offer a discount if you purchase or combine more than one policy with them.

Lower Your Commercial Auto Insurance

Employees with good driving records who drive your vehicles will help lower your costs. On the other hand, employees with bad driving records will increase your premiums. Before hiring anyone who will be driving any of your commercial vehicles, check their driving record.

Also, consider purchasing less expensive vehicles to lower your Auto Insurance premiums. Sure, a sleek new truck with all the bells and whistles will be fun to drive, but is it worth the additional expense of higher insurance premiums? Maybe it is, but it’s important to factor insurance costs into your buying decisions.

Focus on Safety

Safety should be a priority at any construction site. It’s just good business sense to keep your employees, customers, vendors, etc. safe. Plus, a safer worksite minimizes the number of employees injured on the job, lowering your Workers’ Compensation Insurance. It should also minimize the number of third-party injuries, lowering your Commercial Liability Insurance. Use the safety information, tools, and resources provided by OSHA to help ensure a safer worksite.

Do Good Work

This is another one that makes good business sense but will also help you avoid lawsuits and thereby lower your Contractors Insurance costs.

Pay Attention to the Workers’ Compensation Formula

Your Workers’ Compensation rates are determined by a formula that looks at several factors. Ensure the information being used in that calculation is accurate and that everything is calculated correctly.  

One factor that affects your rate is your employees’ classification codes, which are based on the likelihood of that employee being injured on the job. Make sure that the correct classification codes are given to every employee. For example, an office worker who is less likely to be injured on the job should not have the same classification code as your electrician. If they do, you may be paying more than you need.

Another factor is your business’s loss history, which is reflected in the experience modifier. A modifier of one is average. A lower number will reflect a better than average loss history, and a higher number will reflect a loss history that is worse than the average. A safer worksite should result in fewer claims, thereby lowering your experience modifier and your WC costs.

Go with an Independent Insurance Agent!

An independent agent – like those at American Insuring Group – will compare insurance rates amng several different competing insurance companies to help you get the lowest rate possible. Give us a call at (800) 947-1270 or (610) 775-3848 or connect with us online to discover how we can help you save more on your Contractors Insurance costs!

Tags: Construction Insurance, Contractor Insurance, Small Business Insurance Reading PA, workers comp costs, Contractor Safety Management

How to Handle a Questionable WC Insurance Claim

Posted by David Ross on Sat, Aug 01, 2020

Handle questionable workers compensation insurance claims properly, and reduce your WC costs in Philadelphia , Pittsburgh, Erie, Harrisburg, Berks County, PA and beyond.Most employers in Pennsylvania are required to carry Workers' Compensation (WC) Insurance to pay medical expenses and lost wages if an employee is injured or develops an illness on the job.

The majority of WC claims are legitimate; however, Workers' Comp fraud is costing businesses billions of dollars every year. WC fraud occurs when employees fake an injury, exaggerate an injury, claim an injury occurred at work when it did not, etc.

If an employer doesn't want to pay more than they have to for WC Insurance, they need to be on the lookout for questionable claims. Here are 4 valuable tips:

Report All Injury Claims

Even if you suspect a claim is not legit, you must report all injury claims to your Workers' Compensation Insurance carrier. Failing to do so could result in hefty penalties.

To do this, complete an injury/illness report. Some employers have their own reporting forms, and others use forms from their WC carrier or state WC agency. You should have every type of workplace accident report form available to avoid legal issues. Fill out the form with the injured employee if possible or deliver the form to the doctor who attended the employee first.

Typical information requested on these forms include (but is not limited to) the following:

  • Date of injury
  • Where the injury occurred
  • A description of the injury or illness
  • When the employee became aware of the injury or illness
  • The date the injured employee received AND returned the form

Inspect and Document

You can help any WC investigation by gathering information as soon as an injury occurs while the information is fresh in everyone's minds.  That includes surveying the scene of the accident, collecting information (such as talking to witnesses and writing down the details of the accident), and completing an incident report.

Try to determine the leading cause or causes of the accident and answer (in writing) the following questions:

  • Were company rules and regulations followed?
  • Were there any witnesses?
  • Did something unique happen that caused the accident?
  • Could the accident have been prevented?
  • If it could have been prevented, why wasn't it?
  • Is the risk still there?

As soon as possible, take photographs where the accident happened and any potential causes of the accident. Ask the doctor to document the state of the employee's injuries.

If there are witnesses, get the following information from them:

  • Their name
  • Their address
  • Contact information
  • A summary of what they saw

Let Your Claim Handler Know if You Believe a Claim is Questionable

The claim handler has experience and training in investigating WC claims – both legitimate and false claims, and they have the authority to deny a claim. However, you know more about your employees, your work environment, and the circumstances of an employee's claim than the claim handler.

If you feel a claim is questionable, you must let your claim handler know so that they can conduct a proper investigation.

Continue Communication

Once a claim is filed, the employer must continue to communicate with the carrier. Immediately forward any relevant information, such as medical documentation. Your claim handler may ask for additional information, such as the number of lost workdays, the RTW status, etc. If you want the claim resolved quickly, respond to claim handlers promptly.

 

How to Immediately Lower Workers' Compensation Insurance Costs:

If you want to lower your WC costs, work with an independent insurance agent like the pros at American Insuring Group. We can offer you lots of choices in WC insurance carriers. We'll make sure you get the right coverage at the right price. Give us a call today at (800) 947-1270 or (610) 775-3848 or connect with us online.

Tags: Workers Compensation Insurance, workers comp costs, WC Insurance, Workers Compensation Insurance Fraud

Slip-Resistant Shoes Help Lower Restaurant Insurance Costs

Posted by David Ross on Sat, Jul 04, 2020

slip-resistant shoes can lower restaurant insurance costsIf you want to lower Restaurant Insurance costs, a comprehensive safety plan is essential. A well-designed and enforced safety program helps minimize the number of injuries. This results in fewer insurance claims, which lowers your insurance costs and provides numerous other benefits, such as improved employee morale and productivity.

But where should you begin with a safety program?

According to the Bureau of Labor Statistics, slips, trips, and falls are the third most common type of work-related injury in the US and the second most common fatal work-related injury. While falling from a higher level resulted in more work-related fatalities, injuries caused by falls on the same level occur more often in restaurants and can cause injury. In fact, the BLS reports that half of all falls from the same level ended in more than ten days away from work.

The most common injuries in same-level falls include sprains, strains, dislocations, and tears to the lower extremities, which are the most expensive category of injuries, costing almost $13 million in Workers’ Compensation costs every year.

So, there’s your answer as to where to begin! Start your safety program by minimizing the risk of falls. Here’s information about one simple step – providing slip-resistant shoes - that can help significantly decrease slip, trip, and fall injuries in your restaurant.

The Study

According to the Centers for Disease Control and Prevention (CDC), “Laboratory studies of slip-resistant footwear to reduce slips, trips, and falls have shown promise in reducing slips, but limited field research made it difficult to demonstrate if slip-resistant footwear actually reduced injuries.”

So, researchers at the National Institute for Occupational Safety and Health (NIOSH) evaluated 17,000 food-service workers in 226 school districts across the US to determine the effectiveness of a program that provided highly-rated slip-resistant shoes at no cost to the workers. The researchers wanted to see if this type of program would reduce WC injury claims related to slipping on greasy or wet floors.

Workers in some of the school districts in the study wore 5-star rated slip-resistant shoes that were given to them at no cost, and workers in other districts wore their own slip-resistant shoes. The shoes provided were designed specifically to prevent slips on greasy or wet floors.

The Results

The districts where workers were provided slip-resistant shoes experienced a 67% reduction in claims for slip injuries. The baseline measure was 3.54 slipping injuries per 10,000 months worked, which was reduced to 1.18 slipping injuries per 10,000 months worked during the time when workers wore slip-resistant shoes that were provided at no cost.

The other districts where workers were not given slip-resistant shoes did not experience any decline in slip injuries.

The study also found that – prior to the study - workers over the age of 55 had a higher probability of a slip-related WC claim (4.2 injuries per 10,000 worker months) than workers under the age of 55 (2.3 injuries per 10,000 worker months). Therefore, as the number of workers over the age of 55 remain active in the US workforce, preventing slipping injuries becomes even more vital if businesses want to keep Workers’ Compensation costs down.

The CDC concluded, “The findings from this study provide evidence of the effectiveness of slip-resistant footwear and may assist employers, managers, and workers in their decision on whether to invest time and resources in a slip-resistant footwear program.”

Additional Tips to Lower Your Restaurant Insurance Costs

American Insuring Group specializes in Restaurant Insurance and is focused on providing the best insurance coverage at the best price. Discover more safety tips on our blog and give us a call today at (800) 947-1270 or (610) 775-3848 or connect with us online to discover how we can help you save even more on your Restaurant Insurance costs!

Tags: Restaurant Insurance, workers comp costs, Safety Programs, Restaurant Safety, Restaurant Insurance Costs

Workplace Ergonomics Minimizes Injury and Lowers WC Costs

Posted by David Ross on Sat, Jun 27, 2020

Workplace ergonomics can impact Workers Compensation Insurance costs in Philadelphia, Pittsburgh, Reading, Lancaster, Erie, PA and throughout the US. We often focus on minimizing Workers’ Compensation Insurance costs in potentially dangerous workplaces such as restaurants and construction sites: however, office spaces are not immune to workplace injuries.

One of the most significant work-related injuries in an office are musculoskeletal disorders (MSDs). According to OSHA, “Work-related musculoskeletal disorders are the most widespread occupational health hazard facing our Nation today.” Every year, almost two million workers suffer from work-related MSDs, and approximately 600,000 of those workers lose time from work due to the MSD.

OSHA estimates the direct cost of MSDs to be between $15 and $20 billion every year, with total yearly costs in the $45 to $54 billion range. Plus, $1 out of every $3 spent on WC is a result of insufficient ergonomic protection, which can help avoid MSDs.

What Are Musculoskeletal Disorders?

The Bureau of Labor Statistics (BLS) of the Department of Labor describes MSDs as “musculoskeletal system and connective tissue diseases and disorders when the event or exposure leading to the case is bodily reaction (e.g., bending, climbing, crawling, reaching, twisting), overexertion, or repetitive motion.” MSDs affect joints, bones, muscles, the spine, etc. Examples of MSDs include carpal tunnel syndrome, tendonitis, degenerative disc disease, and tension neck syndrome.

The Centers for Disease Control and Prevention describes work-related MSDs as conditions in which “the work environment and performance of work contribute significantly to the condition; and/or the condition is made worse or persists longer due to work conditions.”

What is Workplace Ergonomics?

Workplace ergonomics - the science of fitting a job to a person so that they can work safely, without injury or pain - can help prevent MSDs, thereby reducing workplace injury and reducing Workers’ Comp and other expenses. A bonus is that it can actually improve a worker’s productivity.

Often, a few simple adjustments can make a huge difference, and it doesn’t have to cost a lot.

Ergonomics in the Office

Occupational Health & Safety reports that workers spend an average of 1,700 hours per year in front of a computer screen. That’s more than 70 days every year sitting at a desk. Sitting in the same position for long periods of time can cause pain and injury and lead to MSDs. Many office workers don’t even realize that they are sitting in awkward postures that can affect their health and safety.

Here are some of the most common ergonomic problems in an office:

  • Monitors are too low, which forces flexion of the cervical spine.
  • Armrests are not used properly or not at all, which can cause tensions in the neck, shoulders, and trapezius muscles.
  • The mouse is not aligned with the shoulder, which can cause pain in the neck, wrist, and upper limbs.
  • Workers use phones without a headset, which can cause pain in the shoulder and spine.

Here are some tips to improve office ergonomics:

  • An office chair should allow for height adjustment so that the worker can sit with his or her knees at a 90-degree angle. It should also have adequate lumbar support and armrests, so elbows are at a 90-degree angle.
  • The desk and chair should allow enough space for the user to cross their legs. Users should be able to rest their feet flat on the floor, so use a footrest if needed.
  • Pad the edges of the desk if there are hard edges.
  • A monitor should be placed, so the top is at or just below eye level and is an arm’s length away. The brightest light source should be to the side to avoid glare.
  • The mouse should be directly in line with the shoulder, so the wrist remains straight.
  • The height of the keyboard should allow the user to keep their wrists straight while typing.
  • A phone should be held in one hand, or the user should use a headset.

MyAbilities offers a tool called Rapid Office Strain Assessment (ROSA), which is a self-guided self-assessment that shows workers how to adjust their workstation to prevent discomfort and injury.

Want to Save Even More on Workers’ Compensation?

Creating safe workplaces to avoid injuries is the best way to reduce WC costs. Another way to save on all commercial insurance costs is to work with one of the independent agents at American Insuring Group who specialize in Workers’ Compensation Insurance. Give us a call today at (800) 947-1270 or (610) 775-3848 or connect with us online to see how we can help you save on your Workers’ Compensation and other insurance costs.

Tags: Workers Compensation Insurance, workers comp, PA Workers Compensation Insurance, workers comp costs, Safety Programs

Is a Workers Comp Insurance Loss-Sensitive Plan Right for You?

Posted by David Ross on Sat, Apr 18, 2020

save_workers_comp_insuranceMore and more employers are moving away from the traditional guaranteed Workers’ Compensation Insurance plans into loss-sensitive plans. Loss-sensitive plans can help some businesses save money, but for others, a loss-sensitive plan can cost a company more than a guaranteed plan.

How do you know which type of Workers’ Compensation plan will yield the highest return for your business? Here are three tips to help.

Understand the Different Types of Loss-Sensitive Plans Available.

Retrospective Rating Plans

The Insurance Journal defines a retrospective rating plan as a plan “in which the final premium is based on the insured’s actual loss experience during the policy term, subject to a minimum and maximum premium, with the final premium determined by a formula which is guaranteed in the insurance contract.”

With a retrospective rating plan, an employer pays a standard premium - a combination of a basic premium and a loss projection - at the beginning of the policy year. After eighteen months, the insurer uses the employer’s actual losses to calculate a retro premium. If the retro premium is lower than the standard premium, the employer receives a premium from the insurer for the difference. If the retro premium is higher than the standard premium, the employer has to pay an additional premium.

Typically, there is a cap on the additional premium (usually 1.20 times the standard premium) an employer must pay.

Large Deductible Plan

A large-deductible plan is basically a guaranteed WC plan that includes the employer self-insuring part of its compensation losses with a large deductible. With this type of plan, the employer pays a lower premium but is then required to set up an escrow fund and reimburse the insurance company for claims up to a certain dollar amount.

Captives

The Insurance Journal defines captives as “any insurance company that is owned by one or more organizations, and that insures only the owners of the company.” There are typically two types of captives used for WC. One is a single owner, where the company that is insured has complete control over everything, including investments, operations, etc. The other type is a rent-a-captive, which is owned and run by an organization other than the insured, such as a broker, a fronting insurance carrier, etc.

Understand Your Risk Tolerance

The advantage of a guaranteed Workers’ Compensation Insurance plan is that your premiums are very predictable. You can put it into your budget and not worry about it. The cost of loss-sensitive plans can vary significantly. You can include an estimate in your budget, but the actual cost can vary, along with the frequency and timing of payments.

IF your company has a low tolerance for risk, a guaranteed plan may be a better choice. However, if you’ve created an effective safety program, provided all of your employees with appropriate safety training, have a robust return-to-work program, and have minimized workplace injuries, your loss projections should be reasonably accurate. Therefore, you may want to consider taking on more risk with a loss-sensitive plan. You’ve reduced risk within your organization, and a loss-sensitive plan could provide a higher return on your investment.

Consider the Financial Impact of Each Type of Plan

You should understand the impact each type of plan will have on your cash flow and the tax implications of each. A guaranteed cost plan may cost you more; however, it provides consistent payments, and you know how much you’re going to pay. You can put the cost of your premiums into the budget and not worry about it.

However, a loss-sensitive program can offer cash flow advantages because you’re paying for claims as they occur rather than paying an insurance company upfront for expenses that may not occur for months or even years.

Need More Help Lowering Workers’ Compensation Costs?

American Insuring Group is committed to providing the best insurance coverage at the best price. First, we offer blogs for a variety of industries to help improve workplace safety, which will help lower WC costs.

Plus, we are independent agents who specialize in Workers’ Compensation Insurance. Give us a call today at (800) 947-1270 or (610) 775-3848 or connect with us online.

Tags: Workers Compensation Insurance, PA Workers Compensation Insurance, workers comp costs, Commercial Insurance, Return-To-Work Programs

Reduce Workers’ Comp Insurance Costs With Vocational Rehabilitation

Posted by David Ross on Sun, Mar 15, 2020

How to Reduce Workers Compensation Insurance Costs with Vocational RehabilitationVocational rehabilitation (VR) is one of the benefits of Workers’ Compensation Insurance. It can benefit both the injured employee and their employer by getting the employee back to work more quickly, thereby reducing the costs associated with Workers’ Compensation claims.

However, this benefit needs to be closely monitored to ensure that it continues to benefit the injured employee. If VR is no longer benefiting them, it could be costing your business.

What Is Vocational Rehabilitation?

Vocational rehabilitation as a WC benefit is designed to help injured employees return to work. Vocational rehabilitation services can vary depending on what the injured employee needs.

According to the National Rehabilitation Information Center (NARIC), some of the services a rehabilitating consultant (QRC) may provide include the following:

  • vocational assessment and evaluation
  • training
  • upgrading of general skills
  • refresher courses
  • on-the-job training
  • career counseling
  • employment searches
  • consulting with the employer for job accommodations or modifications.

Who Can Benefit From Vocational Rehabilitation?

Typically, VR is a WC benefit reserved for injured employees who have been out of work for an extended time. The process begins with a consultation with a QRC who can make recommendations regarding whether VR could be a benefit for the injured employee or not.

The QRC considers several factors before making a recommendation, including whether or not the injured employee will be able to return to the job they had before the injury, whether or not the injured employee is expected to be able to find gainful employment with the employer he or she was with when injured, and whether or not the injured employee is able to find gainful employment through VR services based on the treating physician’s opinion.

How Can Vocational Rehabilitation Be Monitored?

If vocational rehabilitation is approved, the claim handler must monitor the regular reports issued by the QRC. Those reports will include what services are being provided and how well the employee is recovering.

When reviewing those reports, the handler should consider several things. Are the employees’ physical limitations (new or ongoing) interfering with the completion of the rehabilitation plan? The employee could have a setback or could incur a new injury or disability that could stop him from completing the VR program.

Is the injured employee fully engaging in the VR? If the employee is not cooperating, such as missing appointments or not keeping in touch with his or her employer and/or QRC, he or she is not fully engaged in the program and probably won’t benefit from it.

Should the goals of the VR be changed? Perhaps the injured employee is not progressing as expected. Perhaps they’ve had a setback. If this occurs, it may be necessary to adjust the VR goals.  

When is it Time to Terminate Vocational Rehabilitation?

If, while reviewing these reports, it appears that the injured employee is no longer benefiting from VR services, termination of those services should be considered. The individual asking for the termination of VR services has to prove that those services are no longer benefiting the injured employee.

Typically, grounds for terminating those services include the following:

  • Death of the injured employee
  • The Workers’ Compensation case is settled
  • The injured employee is no longer participating in the services
  • The injured employee returns to work with a minimal or no wage loss

Vocational Rehabilitation can often help an injured employee return to work more quickly, benefiting both employee and employer. However, Vocation Rehabilitation that is not monitored can end up costing employers big time.

That’s why it’s imperative that someone continues to monitor the injured employee’s status and level of cooperation and take steps to terminate VR services if evidence shows that the injured employee will no longer benefit from those services.

 

Here's How to Save Even More on Workers’ Compensation Insurance!

The independent agents at American Insuring Group specialize in Workers’ Compensation Insurance. We have the experience and the knowledge to help you lower your WC costs. Our independence allow us to shop and compare insurance providers and policies to get you the right protection at the best price.

Give us a call at (800) 947-1270 or (610) 775-3848 or connect with us online.

We provide worker's compensation insurance solutions in Philadelphia, Berks County, Lancaster, Harrisburg, Allentown, Pittsburgh, Erie, PA and beyond. 

Tags: Workers Compensation Insurance, workers comp, PA Workers Compensation Insurance, workers comp costs, Vocational Rehabilitation

How Long Should an Injured Employee be Out of Work?

Posted by David Ross on Sat, Feb 15, 2020

Reduce Workers Compensation Costs with a strong Return to Work program.Return-to-work (RTW) programs help employers by helping retain experienced workers, reduce turnover, and control Workers’ Compensation Insurance costs. RTW programs help injured employees by promoting physical and mental healing, retaining social connections, providing financial security, and helping them retain skills. RTW programs even help improve productivity and morale among co-workers. 

Studies show that injured employees who are out of work for more than six months have less than a 50% chance of returning to work and 80-90% of injured workers would rather get back to work than collect disability.

What is a Return-to-Work Program?

The goal of RTW programs is to get an injured employee working again as quickly as possible while they are still recuperating. That may mean providing the injured employee with temporary, modified, or transitional duties to get them back to work more quickly.

Unless you are a doctor, you probably don’t know how long it typically takes an injured employee to heal from an injury – whether it’s a simple sprain or a more serious injury. To develop an effective RTW, it is important to have some expectations as to recovery times. The good news is that someone has already figured that out for you.

Evidence-Based Medicine (EBM) Injury Guideline

An EBM injury guideline tool can help reduce uncertainty by providing recovery timeframe estimates, including the average and median amount of time it takes an injury to heal. It is based on the type of work an employee does – sedentary, light, medium, heavy, or very heavy work.

The two most well-known tools are the ODG guidelines from the Work Loss Data Institute (WLDI) and the MDGuidelines from the Reed Group.

The ODG (official disability guidelines) was released in 1995 as an “evidence-based disability duration (return-to-work) guideline,” by the WLDI. In 2017, WLDI became part of MCG Health.

MDGuidelines are researched and evaluated by an academic-based research team. According to the Reed Group, “MDGuidelines empower employers, insurers and providers to successfully improve health and financial outcomes.” It links several data sources – OSHA, CDC, the National Hospital Discharge Survey, and the worldwide ICD-9 coding system.

An Example

If an employee suffers from a partial rotator cuff tear, and they have a sedentary or light job, it should take a minimum of zero days and a maximum of four days for that person’s body to physically heal enough for them to go back to their full duties at work. However, if that same employee has a heavy or very heavy job, it should take a minimum of 21 days and a maximum of 85 days to recover and be ready to go back to their full work duties.

If you utilize an RTW program, that means that even an employee in a heavy or very heavy job with this type of injury should be back to work within four days – not doing their original work duties but doing sedentary or light duty.

What might surprise you is that more than 50% of people aren’t back to work within the maximum amount of time (85 days) required for physical healing of a partial rotator cuff tear. Understanding recovery time and instituting an RTW program will lead to benefits for your injured employee, his or her coworkers, and your bottom line.

Want to Save Even More on Workers’ Compensation Costs?

Give the experienced independent agents at American Insuring Group a call at (800) 947-1270 or (610) 775-3848 or connect with us online. Our independence means we're free to shop competing providers to get you the best deal. We’ll show you how to save on all of your worker's comp insurance needs in Philadelphia, PA and far beyond.

Tags: Workers Compensation Insurance, workers comp insurance, PA Workers Compensation Insurance, workers comp costs, WC Insurance