“Commit suicide,” “successful suicide,” “the mentally ill,” “suffering from a mental illness” —These phrases rattle off the tongue, yet we, as social justice advocates, find they rattle our souls as people continue to use them in well-meaning workplace education programs and community discussions. Let us explain… In 1984, George Orwell said, “If thought corrupts language, language can also corrupt thought.” The above phrases are commonly used inside and outside the mental health sector and, because of this common usage, they are accepted. We suggest that they corrupt the thinking of those who speak them and those who hear them. We would like to change this. What if being more mindful of our language could release new ways of thinking that eventually open up new opportunities for creative ideas, thoughtful approaches and ultimately true social inclusion? What if we make a conscious effort to find words that more accurately reflect the experience of mental health conditions and suicide — would we be better able to have empathy, support and inclusion in our workplaces and communities through the use of more skillful language? We argue: Yes. Neurolinguistics tells us the words we use as we speak inform the way our brains store and process information about whatever it is we are talking about. Words carry current meanings and history of meaning. Many words are associated with inaccurate and unfair messages that serve to perpetuate misunderstanding and prejudice. The labels applied by clinicians to people who have mental health challenges create assumptions, expectations and interpretations that can set misperceived limits on how much growth and performance is possible, while also creating the means for social exclusion. We believe this process is often unconscious and has an insidious effect on our collective thoughts and feelings, especially regarding marginalized groups, such as people who live with suicidal experiences and mental health conditions. See Also: Breaking the Silence on Mental Health We are hard-wired to remember problems, especially when we perceive these problems to be dangerous. So, using language that is negative, connotes difference and insinuates a threat tends to be very “sticky.” To undo this, we need to spend extra effort to build a vocabulary that is life-affirming, dignified and inclusive. Paying attention to our language as we talk about mental health and suicide, while constantly working toward improving our language, will help create a workplace culture of compassion, vitality and engagement. Stigma reduction campaigns and workplace mental health trainings that do not pay careful attention to language are limiting their impact and may be the reason why, even after many years, we are not much further ahead in terms of reducing stigma in the workplace. Language is the most powerful tool in understanding each other. In any social movement, language must be addressed. How we speak about people informs us about them, so when we speak unconsciously, without attention to bias and misperception, we are perpetuating social prejudice and damage. By changing our language, we alter our perceptions and attitudes; this is social justice. In a sequel to this blogpost, we will explore the history, impact and alternatives of specific words that are often used when talking about suicide and mental health.

In the spring session of the Texas Legislature, I listened to testimony about the impending House Bill 335, which would have prohibited the sale of Named Driver auto policies in Texas. So what does this have to do with microinsurance? A recent development, microinsurance has primarily been considered to offer solutions in life insurance, credit insurance and agricultural insurance and is being marketed primarily outside the U.S. to low-income individuals and families. See the recent article by the CPCU Society in its Insights publication as an excellent primer on the relatively recent development and use of microinsurance in these foreign markets. The question is: Can we learn from foreign microinsurance programs to help solve an insurance dilemma closer to home--how to make automobile insurance accessible and affordable to foreign-born, non-licensed residents in the U.S. Evaluating the Need During the testimony on proposed Texas HB 335, insurers and other interested parties repeatedly argued that the Named Driver product was needed to provide an option for “low-income households” in Texas--the very argument made on behalf of microinsurance in foreign countries (where, of course, the definition of poverty may be quite different than in the U.S.). Only we don’t have to go to a foreign country to find potential customers. An estimated 3% of the current U.S. population is individuals who have immigrated, not only from Mexico but from Central America, South America, Europe and Asia. Isn’t this population ideal for microinsurance? Foreign-born potential customers have behavior patterns and attitudes toward personal risk management and poverty that have followed them to the U.S. This group needs to assimilate and follow U.S. laws of financial responsibility. But as far as any evidence of prior insurance, any credit history, the availability of driver history and the ability to pay, this market differs from the typical U.S. consumer. Striking Parallels I find striking parallels between what is being attempted in Texas with the non-standard market and the goals and concepts espoused in microinsurance. Based on my experience in the non- standard market, my assessment is that the industry has attempted to capitalize on the burgeoning market, but the question is --has it done so in a manner that is consistent with the principles of effective microinsurance?

In 1983, Microsoft Word was introduced. It wasn’t the first word processor, and it isn’t the only word processor, but it quickly became a standard — a “given.” From a productivity standpoint, the first adopters of word processing certainly had advantages over the alternatives (typewriters and ball point pens). Today, however, we all use Word and Excel and Outlook. Your only advantage may be in how quickly you can type or speak into your device. This is not unlike what is happening in the world of data. Data availability has become ubiquitous. Not only has data become freely available, but data analysis through tools, consolidators and rating companies has become freely available, as well. When everyone has access to the same information at the same time, that’s data symmetry. In Part 1 of our data symmetry blog, we followed the quickly shifting trends from asymmetrical data availability to a market filled with data symmetry. We illustrated how data symmetry is rapidly changing the idea of competitive advantage. If everyone has access to the same data and if digital technologies are increasing the number of data sources, an organization’s proprietary data will lose the ability to keep the company ahead. Data symmetry will then throw established insurers into a mid-life crisis, with everyone from marketing to underwriting to claims asking, “What makes our insurance actually different?” Once insurers are operating from the same data, and the prediction of symmetrically available data has become a full-blown reality, then data will no longer be a differentiator, and something else will be.  But what? The good news is that there will always be a way to create advantage if insurers remain active in fostering their uniqueness. From a data standpoint, here are three differentiators for your organization to consider: Moving from individual histories to virtualized views The data that is contained in today’s individual history will pale in comparison with tomorrow’s virtual record. In the very near future, everyone will take advantage of virtualized views of complete individuals or commercial accounts. These will includ/.e every facet of someone’s lifestyle, health history, safety records, common travel patterns, activity levels and even purchase histories. Virtual individuals will be known and understood in ways that real individuals may not even know themselves. We already see this happening in online sales of music, books, movies, coffee, auto parts and tennis shoes. Where there is a purchase, there is a preference. Purchase patterns are allowing digital retailers to accurately predict which marketing messages will work with hyper-targeted methods. Modern insurers will use these same automations and data analysis to improve timing, not only for marketing but also for claims prevention. As virtual individual data interacts with external sources, such as geographic and weather data, the insurers who have been practicing their data science will become predictive pros. Predictive analytics will still allow some competitive asymmetry to exist. Think of data streams as colors in a box of paints — the more colors one finds in the box, the clearer the picture that an insurer will be able to be paint. Data analytics experience will be the art classes that will make some insurers capable of predictive masterpieces. The old colors will still be in the box. Claims histories and proprietary risk models will still be available, but they will sustain their value when they are supplemented with fresh colors and new data perspectives. Innovating around products and services Predicting results and preventing claims will support business in the current realm of insurance. Both are still subject, however, to data symmetry. Data symmetry will, in turn, push insurers to innovate. What will be striking to see is how often these front-end innovations of all types will enhance back-end data capabilities. Early in 2016, for example, Liberty Mutual and Subaru announced a partnership that will bring usage-based insurance into Subaru’s connected car platform. Usage-based insurance is one of the clearest examples of innovative products, fueled by data that will also improve data analytics. This involves a new measure of innovation — how quickly data can move from collection to analysis. The quicker an insurer can transfer data gathering into meaningful action, the more valuable the innovation. Companies will be asking what levels of automation can be employed to turn prediction into prevention. They will also be looking for formulas that make innovative products or services attractive to consumers. Data innovations aren’t instantly palatable to people. In-car telematics devices are a great example. The initial innovation was somewhat offset by the expense of installation and the perception that an installed device invaded consumer privacy. Most efforts at product innovation will make consumer incentives part of the formula. As insurers turn “free data” into better ratios between pricing and risk, both the insurer and the consumer will need to see the clear benefits. Residential insurance is an example of an area ripe for innovation. Home insurance premiums are most often paid within the house payment. Most homeowners would be thrilled to have their house payment go down $100 to $200 per month. Property insurers that can take advantage of home sensor data and Internet of Things data could make that happen. In exchange for the savings, many homeowners would sign off on the idea that their insurer now has monitoring capability. Property insurers would then be adding home data to their available data streams. This could give carriers a competitive difference. Lender/insurer partnerships (additional product innovation) may also arise with greater frequency if lenders can find corollary trends between home monitor data and clients with the fewest incidents. This same data/pricing correlation will apply to commercial insurance. If the use of drones, security system monitoring and environmental system monitoring will result in lower insurance costs, most companies will see the value in an insurer that is looking out for their bottom line. Insurers will find some of their differentiation in data-driven, value-added services. Anywhere that data can point to a better practice, an insurer will want to promote that to customers. Whether that means suggesting alternative travel routes for trucking companies or promoting add-on products for specialized risk, the influence of data symmetry can be overcome with creativity and innovative thinking. Focusing on the stars When we discuss data, our mindset traditionally envisions incoming data. Customer experience data, however, is much more of a two-way data street. Consumers are painting a new world of service with their ratings and stars. These outside views are also subject to data symmetry. Prospects are now able to efficiently compare insurers with real service data, including both sources that are verifiable and those that contain unstructured, conjectural data. In Competing in an Age of Data Symmetry, Part 3, we’ll look at what an insurer should be doing to prepare itself for greater customer scrutiny and how reputation analysis will validate or invalidate an organization’s brand promises.

The Internal Revenue Service is taking as long as 21 days to review tax returns, according to research from fraud prevention vendor iovation, a clear sign that Uncle Sam has stepped up anti-fraud measures. Even so, tax return scams that pivot off stolen identity data continue to rise for the third consecutive tax season. The latest twist: Tax scammers are increasingly targeting vulnerable populations—low-income, children, seniors and homeless—as well as prisoners, overseas military personnel and the deceased, according to an FBI alert. Complimentary webinar: How identity theft protection has become a must-have employee benefit And criminals have gotten very creative about conducting phishing campaigns to fool individual consumers—and key employees at targeted companies—into handing over personal tax-related information, useful for filing fake returns. Tax software vulnerable The FBI also says criminals often use online tax software to commit the fraud. That’s particularly troubling, considering what the Online Trust Alliance found in a recent audit of free e-filing services approved by the IRS. Of the 13 services audited, about half failed somewhat basic security protocols, such as email authentication and SSL configurations. Craig Spiezle, Online Trust Alliance executive director Craig Spiezle, executive director of Online Trust Alliance, says some of the vulnerabilities, such as unsecure sites, are obvious to the casual person, let alone criminals. “These sites are such high targets, you’d expect 100% of these to be like Fort Knox,” he says. “There’s no perfect security, but you would expect not to see (simple) vulnerabilities.” Some e-filing sites, for example, had simple server misconfigurations or didn’t have current secure protocols; one provider failed to adopt an extended validation (EV) SSL certificate, leaving it open to spoofing. Although not everyone is eligible for the free e-filing services that OTA audited, Spiezle says many of the paid e-filing services are run by some of the same parent companies, and thus use much of the same lightly protected infrastructure. He says it would be fair to assume that many of the paid e-filing sites would have the same 46% failure rate as the free e-filing services audited by OTA. Personal information trades on black market Even if cyber criminals don’t use stolen tax-related data for filing fraudulent returns, that information is highly valuable on the black market. Spiezle points out that it’s the only place where this type of rich information—such as income, employer, number of dependents, Social Security numbers and even bank accounts—is available all in one swoop. “All that data that’s amassed is a treasure chest,” he says. “If you want to create a persona of someone’s identity, you have all the data in one place.” The IRS expects that, this year, 80% of the estimated 150 million individual tax returns will be prepared with tax software and e-filed—and that’s music to fraudsters’ ears. One typical avenue for cyber thieves is to file returns as early as possible, claiming refunds as large as $1,000 to $4,000 on untraceable prepaid debit cards. They can fly under the radar by filing very generic returns, and those multiple refunds turn into a lucrative operation. “They have immediate access to that cash, as opposed to credit card fraud where the value is not as high and the delivery is through a retailer, so they have to figure out what to do with those goods,” says Scott Olson, vice president of product at iovation, a provider of device authentication and mobile security solutions. Phishing, malware skyrocket According to the Government Accountability Office, the IRS prevented $24 billion in fraudulent tax refunds related to identity theft in 2013, while paying out $5.8 billion in fraudulent refunds that it didn’t discover until a year later. And the number of fraud attempts is on the rise: As of March 25, the IRS reported a 400% increase in phishing and malware incidents related to the 2016 tax season. Email phishing campaigns include links to web pages requesting personal information, useful for filing fake returns. These fake pages often imitate an official-looking website, such as IRS.gov or an e-filing service, and also may carry malware, which can turn over control of the victim’s computer to the attacker. This January alone, the IRS counted 1,026 email-related fraud incidents, compared with 254 a year earlier. Phishing scams also are targeting employers—because criminals know that’s where they can find large caches of income-related information. One growing trend is the so-called business email compromise (also known as “CEO fraud”), a variation of spear phishing. The phisher does deep research on a targeted company, then impersonates a senior executive to get a subordinate to do something.

Vidur Apparao, chief technology officer at Agari, which offers an email security platform, says malicious attachments and URLs compromised the bulk of spear phishing emails in the past. But what his company is seeing now is phishing ruses aimed at specific employees that leverage trust to get the recipient to take a specific action. Such attacks do not carry any viral attachments or bad URLs that can be detected. Yet they have proven to be very effective at duping the recipient into forwarding files containing employees’ W2 forms. “Criminals are leveraging the cloud at three separate points, in ways they couldn’t before: developing social engineering content, sending out spear phishing attacks and getting back a response,” he says. Basic security helps According to the OTA, 92% of the publicly reported breaches in 2015 could have been prevented. Take email authentication. It’s almost a basic security tool that prevents emails from being spoofed. Those OTA-audited e-filing services that didn’t use it are contributing to the breaches. “The lack of email authentication or the slow adoption in some cases has led to the prevalence of this easy type of attack,” Apparao says. Spiezle says people need to be aware that emails and other tactics are becoming more sophisticated, and protect themselves accordingly. “The problem is that we are all moving so fast, and we have all these devices and desktops—we are multitasking,” he says. “And the criminals play off that, and they’re getting more precise.” This article was written by Third Certainty's Rodika Tollefsen.

A new study―Do Higher Fee Schedules Increase the Number of Workers’ Compensation Cases?―from the Workers Compensation Research Institute (WCRI) explores to what extent workers’ compensation reimbursement rates influence the decision by the medical provider on whether to classify an injury as work-related. According to previously published WCRI research, in many states, workers’ compensation pays higher prices for treatment than group health does. For example, one study found that workers’ compensation prices were two to four times higher than group health prices in some states. And, in most states, workers’ compensation systems rely heavily on the treating physician to determine whether a patient’s injury is work-related. ”Physicians may call an injury work-related in order to receive a higher reimbursement for care he or she provides to the patient,” said Dr. Olesya Fomenko, the author of the report and an economist at WCRI. See Also: Are Your Health Cost Savings an Illusion? The study found, among other things:

• If the cause of injury is not straightforward (e.g., soft tissue conditions), case-shifting is more common in the states with higher workers’ compensation reimbursement rates. In particular, the study estimated that a 20% increase in workers’ compensation payments for physician services provided during an office visit increases the number of soft tissue injuries being called work-related by 6%.
• There was no evidence of case-shifting from group health to workers’ compensation for patients with conditions for which causation is more certain (e.g., fractures, lacerations, and contusions).

This analysis relies principally on workers’ compensation and group health medical data coming from a large commercial database. This database is based on a large national sample of patients where the data were provided by health insurers and self-insured employers. It includes individuals employed by mostly large employers and insured or administered by one of approximately 100 group health plans. The database is unique in that, for a given employee, it shows whether a given medical encounter (visit) was paid for by group health or workers’ compensation. For more information about this study, visit here.

In the technology future we are headed into, the half-life of a career will be about five years because entire industries will rapidly be reinvented. Education counts more than ever. A bachelor’s degree is now the equivalent of high school, and technology skills are as fundamental as reading and writing. Given this, my greatest frustration is that Silicon Valley is regressing by encouraging children to skip college and play the start-up lottery. That approach glorifies college dropouts who start companies—even though the vast majority will fail and permanently wreck their careers. Billionaire Peter Thiel, who cofounded PayPayl and Palantir, goes as far as giving elite students $100,000 to drop out of college. Sadly, I am on the losing side of this debate. My first defeat was in a globally telecast Intelligence Squared debate on whether too many kids go to college. With Northwestern University President Emeritus Henry Bienen by my side, I debated Peter Thiel and conservative icon Charles Murray. We lost, with 40% of the well-educated Chicago audience voting against the need to college and 39% agreeing with us. Needless to say, I was shocked. I lost again over the weekend, on a segment on CBS Sunday Morning, which is the most watched morning news show in the U.S. CBS hyped the college dropouts without showcasing the dozens of failures and lives that have been ruined. CBS took the Thiel Foundation at its word that its fellows have started world-changing companies, created 1,000 jobs and raised $330 million in venture capital. These are gross exaggerations; even the  start-ups that CBS featured are all more of the same silly apps—and there are literally thousands more like these. Here is what I said on the show: "It breaks my heart when some of the most promising students don't fulfill their potential because they're chasing rainbows. "It's like what happens in Hollywood: You have tens of thousands of young people flocking to Hollywood thinking that they're gonna become a Brad Pitt or an Angelina Jolie; they don't. "They don't become billionaires. There haven't been many Mark Zuckerbergs after Mark Zuckerberg achieved success." I added that there is little evidence the Thiel dropouts are doing much that isn't already being done in Silicon Valley. "Everyone does the same thing: It's social media, it's photo-sharing apps. Today it's sharing economy. It's 'Me, too,' 'More of the same.'" You can see the full article published by CBS here, and you can view the segment here.

This is part of a series of interviews by Shefi Ben Hutta with insurance practitioners who bring an interesting perspective to their work and to the industry as a whole. Here, she speaks with Marti Ryan and Tom Yates at Telematic. To see more of the “A Word With Shefi” series, visit her thought leader profile. To subscribe to her free newsletter, Insurance Entertainment, click here. Describe Telematic in 50 words or less: Telematic is a SaaS platform that creates personalized pricing models based on driving behavior, mobile phone usage and lifestyle behaviors. It offers insurance companies a way to more accurately price risk, yet more importantly it's a new marketing channel for a more personalized insurance experience. Why Telematic? [Marti] Because usage-based insurance (UBI) makes sense; it’s where insurance is moving; and it’s a good problem for us to solve as a team. Tom was working for a top carrier and saw how difficult it was to execute a dongle-based telematics program and realized that mobile would most likely replace the dongle/hardware solution, so he went home and built it for a year. [Tom] Marti has over 10 years of market research experience making cities sticky for the next generation. Together, we can make insurance sticky. Describe your typical client: We are in the B2B space targeting small to mid-sized, forward-thinking carriers that are looking to explore UBI and are willing to do something different and stand out. Biggest challenge: Convincing insurance companies that telematics is a play toward a one-to-one relationship with their customers, rather than an extra tool to price risk. The space is crowded with several companies focused on actuarial, B2C and fleets, but then again that's an indication of the role this technology has in the currently evolving insurance value chain. Our solution brings in a different approach to the space, one that creates a new marketing channel using 17 years of combined insurance experience to leverage mobile in an engaging way for the next generation. Who has been supportive of your cause? Co-Manager at Wisconsin Investment Partners Bob Wood has been a champion, Brian Worden CEO of TeamSoft, Liz Eversol from SOLOMO Technology, Tera Johnson of the UW-Extension Small Business Development Center programming in Madison and, of course, our families. Why did you decide to take part in the Global Insurance Accelerator? [Marti] The timing of our start-up lent itself well to an accelerator program that took place in the spring. I’m new to the accelerator scene but understand the huge value it can offer when the right circumstances align to the right program. We had applied to a Madison-based program, and in doing so we broadened our application to the Midwest market. GIA proved to be the perfect fit for us given its insurance focus and our goals; we've made connections and built relationships within the GIA network that will help us get Telematic to where it needs to be. If not for Telematic, what would you be doing? [Marti] Most likely doing three to four other things; working with the B-Corp group to help B-Corps tell their story via B The Change Media and continuing to provide business planing and consulting for the food industry, including a non-profit, kitchen incubator (FEED Kitchens) and a local restaurant kitchen buildout to allow scaling a meal preparation and delivery business using organic, local and gluten-free ingredients. [Tom] Working as a software engineer for another SaaS startup. Best life lesson: Never give up and keep asking the right questions to the right people. What are you most excited about with respect to Telematic? The opportunities that are in front of us are outstanding. We’re certain we’ve got a shot at being a partner for our target market, and, because we’re in the GIA, we’re well positioned to support Midwest-based carriers.

The New England Journal of Medicine carried an excellent article by David Casarette, MD, on the topic of healthcare illusions and medical appropriateness. Click here to read the full article. Casarette observes that humans have a tendency to see success in what they do, even if there is none. Casarette writes, “Psychologists call this phenomenon, which is based on our tendency to infer causality where none exists, the ‘illusion of control.'” This illusion applies in all walks of life, especially in politics and parenting, and it includes medical care. In medical care, the phenomenon has been referred to as “therapeutic illusion,“ and it affects both doctors and patients. Undoubtedly, therapeutic illusion is why placebos can be so effective. In one clinical study, faux surgery worked as well or better than an actual surgery for the treatment of specific conditions. If patients perceive they need surgery, e.g. for knee pain, even though it may not be medically appropriate some will search for a surgeon who can validate the need and perform the surgery. Casarette writes, “Physicians also overestimate the benefits of everything from interventions for back pain to cancer chemotherapy.” Casarette’s article is most interesting to us. Why? We’ve often felt that doctors who perform unnecessary surgeries have ethical problems. The reality may be a little more complicated. The surgery decisions may have a subconscious influence. Toomey had an interesting conversation with the chief medical officer (CMO) of a major health system. The CMO relayed that his wife was having pain in her hand, so they scheduled an appointment with one of their system’s highly recommended specialists. The specialist looked at the wife’s hand and, after a few minutes, stated that she needed surgery. The specialist did not know he was taking to a physician, and the CMO questioned how the specialist could arrive at a diagnosis from just looking at a hand. The response was, “years of experience.” The CMO and his wife got a second opinion and opted for the recommended therapy rather than surgery, and the therapy solved her issue. The attention today is on value-based contracting and data analysis. A group of 20 national employers have come together to share data, so they can assess the healthcare supply chain. But, as noted in our last blog post, analyzing the data is complex, especially because claims data are just a collection of medical bills. How are employers assessing medical appropriateness? What reports can be generated to assess a need for care? In 2014, one state's Medicare costs were $6,631 per capita while another's were $10,610. A big driver was the variation in the volume of procedures, and cognitive biases among doctors can help drive those volumes. Healthcare involves people – patients, physicians, and other providers -- and the human element makes it even more complex. So how do those involved in healthcare address the variation in medical care that is driving up costs? We are biased – we believe the employers are the catalyst to drive change for increased consistency by working collaboratively with suppliers (think Six Sigma). In any case, it’s time for change.

I’m the founder and CEO of WorkersCompensationOptions.com (WCO), a company dedicated to workers’ compensation (WC) and its legal alternatives. This letter is intended to quell the concerns of employees in our client companies—employees who may have been distressed by the recent (mostly negative) publicity from ProPublica and NPR regarding options to WC in Texas and Oklahoma. In case you only saw one installment from the Insult to Injury series, I’ll provide a quick summary. In 2014, the project's authors started to assimilate massive amounts of data from their research concerning each state’s (and the federal government’s) WC system. In March 2015, the authors began releasing articles with an indisputable premise: Collectively, these systems need improvement. That commendable beginning eventually gave way, however, to a hypothesis that is supported neither by reality nor by the overwhelming quantity of data the authors provide. Their conclusion (that employers are in cahoots with insurers to pressure attorneys, anonymous doctors and legislators into discarding the lives of an unfortunate few for the sake of bolstering corporate profits) completely misses the mark in pinpointing why so many WC systems are broken beyond repair. In fact, attorneys and doctors put at least as much pressure on WC systems as insurers, and any attempt to depict the medical and legal communities as innocent bystanders in the WC feud is simply too naive to be taken seriously.[1] I do not doubt the authors’ sincerity in addressing a serious societal problem, but I also do not believe they are equipped to understand the problem they sought—however earnestly—to demystify for their readers. Worse yet, I fear they have positioned themselves in the WC space in a manner that is only likely to retard the implementation of practical solutions. This letter is prompted by the article on Oct. 14, 2015, which painted an inaccurate—even an irresponsible—picture of both Texas nonsubscription (TXNS) and the Oklahoma option (OKO). As that article’s title (“Inside Corporate America’s Campaign to Ditch Workers’ Comp”) is lengthy, I’ll shorten it to CDWC going forward. Texas Nonsubscribing Employees: What Can We Learn? Texas is exceptional in the WC world because it has, for more than a century, offered employers a viable alternative to WC. Of approximately 380,000 employers in Texas, roughly two-thirds subscribe to a traditional WC system; the other third are nonsubscribers who develop their own models. That’s about 120,000 different systems, and there is plenty to be learned. We’ve seen various organically grown components develop from these disparate systems, many of which superficially resemble WC. Despite those similarities, however, industry experts understand how counterproductive it is to make unilateral comparisons between TXNS and WC. The authors of CDWC didn’t get that memo. Of all the various lessons learned from diverse TXNS models, one runs counter to conventional WC dogma: Employers can protect themselves while delivering superior care for employees at a fraction of the cost of WC. Eliminating the inflated costs associated with abusive practices that run rampant in WC is a critical component of that particular lesson. Because the CDWC authors insist on judging TXNS through the lens of WC, TXNS looks to them like a system that would appeal to skinflint employers who simply do not care whether their employees get hurt. However, because employees of nonsubscribing companies can sue their employers for tort, the decision to opt out of WC is likely to be penny-wise and pound-foolish for employers who do not take measures to ensure the safety of employees. The CDWC authors’ failure to unpack the importance of tort negligence means many readers will come away from the article without understanding that a typical $50,000 payout in WC could easily be either $0 or $5 million in TXNS—depending on who is at fault for the accident. Even more disappointing is CDWC’s attempt, in a one-sentence paragraph, to gloss over one of WC’s most dangerous shortcomings: the extent to which the no-fault arrangement between employers and employees has removed incentives for safety in the workplace throughout the country. If you are an employee of one of our Texas nonsubscribers, rest assured that your employer has every reason to minimize workplace accidents and to take very good care of you if an occupational injury occurs. In a nutshell, your interests are aligned with your employer’s—another critical lesson we’ve learned from TXNS. Oklahoma Option Employees: A Whack-a-Mole WC System Led You Here ProPublica and NPR harp on a consistent theme throughout the Insult to Injury series: WC is broken. We at WCO agree, and Oklahoma may provide the single best example of how and why a state’s WC system becomes unsustainable. The WC ecosystem is made up of five major communities: insurance, medical, legal, employer and employee. Abuse within the system by any of these communities leads to adjustments to the boundaries of the system. Throughout the Insult to Injury series, the authors go out of their way to sidestep the discussion of systemic abuse. They even attempt to dismiss fraud by citing a study that minimizes its role. Abuse and fraud in WC are, in some ways, analogous to speeding on the highway: Almost all drivers abuse the speed limit, but very few are issued citations. Similarly, the cases of clear-cut fraud in WC only reflect a small portion of the amount of abuse going on. But even if we allow the authors to exclude all instances of clear-cut fraud from the WC conversation, we are still left with rampant abuse driven by insidious systemic incentives. For decades, abuses and inefficiencies within the WC system have led to each of the five communities touting the need for major reforms—at the others’ expense. Real reform threatens each community, which leads to stalemates in negotiations. Major upheaval has been avoided via the compromise of pushing and pulling the system’s boundaries, resulting in a decades-long game of whack-a-mole being played across the nation. If one voice cries, “Data shows an alarming trend in opioid abuse,” that mole gets swatted by requiring more medical credentials for prescribing pain killers. When another shrieks, “Overutilization is surging,” that mole is whacked through costly and time-consuming independent medical examinations. When someone else observes, “Our disability payouts are higher than neighboring jurisdictions,” that mole prompts us to lower disability payouts. Immediately, a fourth voice shouts, “Pharmaceutical abuses make up 8.4% of total costs,” and that mole persuades us to introduce drug formularies. But there isn’t even a moment of silence before another voice remarks, “Our analysis shows dismemberment payouts in this jurisdiction are lower than those of our neighboring jurisdiction.” That mole gets whacked by proposing legislation to increase dismemberment payouts—legislation that is dead on arrival.^[2] At some point, we have to realize the moles are multiplying faster than we can whack them. (If my commentary doesn’t apply to other jurisdictions, I’m happy to restrict it to Oklahoma and Texas because writers can best serve their readers by acknowledging the limitations of their own expertise.) Even if we concede that the changes detailed in the paragraph above aren’t necessarily bad (which I’m not conceding; I’m just trying to be polite and move the argument along), they demonstrate a persistent pattern of outcomes, inclusive of abuse, inherent in any hierarchical bureaucratic system. Regulators are busy reacting to entrenched abuses while market participants find new and exciting ways to game the system. This futile game of whack-a-mole is endless. The Sooner State had a front row seat to witness what TXNS accomplished—both the good and the bad.[3] With that first-hand knowledge, the Oklahoma legislature has finally provided the state—and the country—with an opportunity to see whether real change can restore function to a malfunctioning system. While WC stakeholders assure us they are only a few more whacks-at-the-mole away from making WC hum, Oklahoma lawmakers have written a new chapter in the history of workplace accident legislation. The OKO is neither WC nor TXNS. The brilliance of the OKO is that it doesn’t attempt to overhaul a broken WC system. The legislators effectively stepped away from that decades-old stalemate. Instead of an all-out overthrow, they left WC in place and created an option for employers who were willing to try something new—which is exactly how WC itself was introduced a century ago. Because the OKO is substantially modeled on TXNS, it is easy to see why the CDWC writers conflated the two in their analysis. The errors in CDWC concerning ERISA’s applicability, employee benefits and appeals committee processes in Oklahoma are all presumably honest mistakes made by writers who, in their zeal to distinguish TXNS and the OKO from WC, failed to distinguish TXNS and the OKO from each other. Nevertheless, it’s important for employees to understand that TXNS varies dramatically from one employer to another, and many of the rules concerning TXNS do not apply north of the Red River. Although the CDWC authors misleadingly couple TXNS and the OKO with respect to ERISA’s applicability, ERISA plays no direct role in occupational accidents in the OKO.^[4] We’ll be happy to get you a legal opinion on that, but for our purposes regarding CDWC, take my non-legal opinion as on the record. If others disagree, they should go on the record, as well. While ERISA has served employers and employees well in TXNS, its role in the OKO is only implied (if that). We are free to use it where we wish, as long as we are compliant at the state level. Presumably tied to their ERISA misapplication, the CDWC authors assert that “benefits under opt-out plans are subject to income and payroll taxes.” Such tax advice is unusual from investigative journalists without citation, and I have asked the authors to share their source. Although the jury is still out on this tax issue, it is a point the CDWC authors must distort to substantiate their otherwise baffling claim that the workplace accident plans of OKO employers “almost universally have lower benefits.”[5] If any OKO plans really do offer benefits that aren’t at least as good as those provided by WC, they’re illegal. That’s how the legislators have written the law, and it’s what they’re dedicated to achieving for workers, regardless of obfuscations invoking TXNS, ERISA and unresolved tax implications. The authors of CDWC also completely misrepresent appeals committees for at least a majority of OKO employers. The authors overlook a dramatic improvement to employee protection that the OKO makes to TXNS when they claim that appeals committees in Oklahoma work analogously to appeals committees in Texas: “Workers must accept whatever is offered or lose all benefits. If they wish to appeal, they can—to a committee set up by their employers.” That’s dead wrong. Executives at each of our OKO employers are fully aware that, in case of an employee appeal, the employer has nothing to do with the selection of the appeals committee panel members or the work they complete. The process is independent from the employer and extremely fair.[6] The CDWC authors would do well to read Section 211 of the law more carefully. On the subject of benefit denials, I’ll share a single data point from our OKO book: To date, we have denied exactly one claim. This is a nascent system, so we must be very careful in drawing actuarial conclusions. Still, our company has led more employers from traditional WC into the new OKO than any other retailer, so we have a bit of credibility to offer on this subject. The point of the system isn’t to deny benefits to deserving employees but to ensure benefits are delivered more efficiently. The system is working. The CDWC authors only provide one OKO case study, Rachel Jenkins. Strangely, they lump Jenkins in with four TXNS case studies. The Jenkins case is still being tried. We will withhold opinions—as we hope others would—until a more appropriate time. As a reminder, while the OKO law is stronger today than ever, if it were to be deemed unconstitutional by the Oklahoma Supreme Court, we would have 90 days to get everyone back into traditional WC (per Section 213.B.4.). Next: Vigilance and Diligence My comments are mine and mine alone. I do not speak for any associations or lobbyists. I have no interest in debating those who inexplicably assume that any alternatives proposed to a failing system must stem from sinister motives. However, I encourage anyone (from prospective clients to employees of existing clients) with questions or concerns to call me. Another option for learning more is to click here and watch a formal debate regarding the OKO. This footage was shot in September 2015. It features Michael Clingman arguing against the OKO while I, predictably, argue for it. One thing you can’t miss in that video is my desire to oust most attorneys from the scene. To help explain, I’ll adapt a quotation from John F. Kennedy (who was discussing taxation) to my own area of concern (the well-being of employees): “In short, it is a paradoxical truth that employee outcomes from increased WC protections are worse today, while economic results suffer, and the soundest way to create higher and better standards of living for employees is to eliminate these abused protections.” For philosopher kings, the theory of the OKO may not sound as good as the theory of WC, but when it comes to practical realities the results demand everyone’s attention. To summarize my primary criticism of Insult to Injury, it simply hasn’t done enough. The story it tells is insufficient and smacks of partisanship and ideology, two biases that ProPublica’s journalists allegedly avoid. WC is substantially more complex than a corporation-out-to-exploit-its-workforce short story. Ignoring abuse in each of the communities in a five-sided WC debate demonstrates a lack of journalistic impartiality and a stunning deficiency of perception. Moreover, to my knowledge, ProPublica hasn’t crafted any relevant suggestions for legislation, simply leaving its readers with the vague and implicit notion that federal oversight is needed. If that is the goal of Insult to Injury—to provide one-sided, emotional yarns alongside a treasure trove of data, hoping it will all spur some federally elected officials to create real change at long last—then I suspect ProPublica will still be holding this subject up to the light of opprobrium upon the retirement of each of the series’ authors. We do not aspire to win over the authors or even their followers. We will focus our energies each day on providing the best workplace accident programs for employers and employees alike. Our results should speak for themselves. Finally, I am not an attorney, and nothing in this letter should be taken as legal advice. Sincere regards, Daryl Davis Footnotes: [1] With medical providers, overutilization is always a concern. Click here and watch the video from the 12-minute to the 15-minute mark for a detailed description of rampant WC abuse by surgeons who provide unnecessary and damaging back procedures. If the workers weren’t disabled prior to the surgeries, many were afterward. As for the legal community, simply view slide 73 of the NCCI’s 2013 Oklahoma Advisory Forum. WC disability payments, which is where attorneys get their cut, were 38% higher in Oklahoma than in neighboring states—not because jobs are 38% more dangerous in Oklahoma than in Kansas or Texas but because Oklahoma attorneys are 38% more effective at gaming the state’s WC system. [2] Alabama SB 330—which was prompted by Insult to Injury—never got out of conference. From what I could gather, lengthy negotiations between several different interest groups led nowhere, with the Alabama Medical Association at the center of this particular stalemate. Not surprisingly, the two special sessions called by Alabama Gov. Bentley in 2015 were strictly focused on the state’s budgetary crisis; this bill was never discussed. [3] The final Texas case study offered in CDWC deals with Billy Walker, who fell to his death while on the job. The upside to TXNS is his estate’s common law right to pursue a tort lawsuit against his employer. The employer could have been ordered to pay Walker’s estate a settlement in the millions, but the employer filed bankruptcy before any such judgment could be awarded, which is plainly an unacceptable outcome. This demonstrates a lack of surety—the single biggest problem in TXNS. OKO addresses this issue in various ways, most notably in Section 205 of Title 85A, which guarantees surety for injured workers. [4] For the non-occupational components of your OKO program, ERISA does apply. [5] Per Section 203.B. of the statute, compliant plans “shall provide for payment of the same forms of benefits included in the Administrative Workers' Compensation Act for temporary total disability; temporary partial disability; permanent partial disability; vocational rehabilitation; permanent total disability; disfigurement; amputation or permanent total loss of use of a scheduled member; death; and medical benefits as a result of an occupational injury, on a no-fault basis, with the same statute of limitations, and with dollar, percentage and duration limits that are at least equal to or greater than the dollar, percentage and duration limits contained in Sections 45, 46 and 47 of this act.” (Emphasis mine.) [6] Details of OKO appeals committee procedures are generally misunderstood—for now—by plaintiffs’ attorneys (and, apparently, investigative journalists). Attorneys frequently assume that, because the employer foots the bill, the employer controls the process. For a peek at how the appeals committee process really works for a majority of OKO employers, those curious should watch this video.

If you are a CFO or HR professional reading this article, you are probably familiar with the typical renewal discussion with your employee benefits broker. It goes something like this: Broker: "Well, the insurance company initially wanted a 12% increase." You: "How can that be? We have performed fairly well this year." Broker: "I agree, so we went back to the insurance company and negotiated the increase down to 5%. That is two percentage points below the industry average, so I suggest we lock it in and wrap up the renewal." This conversation happens all too often. Cost increases are the norm in the health insurance industry, and employers are satisfied with merely beating industry averages (while brokers are receiving pay raises because of commissions on the higher premiums). By accepting these terms, employers may be overlooking a big problem. See Also: 7 Tools for Cutting Insurance Costs in 2016 Let's pretend the data below is your three-year insurance summary. Take a look and determine if you have had a successful run.

• Enrolled employees: 300
• Total health plan costs: $3.5 million
• Average annual cost increase: 2.5%

At first glance, it would appear that you had a pretty successful stint. A 2.5% average over the past three years is definitely beating industry averages. So what is the problem? A closer look shows you are spending more than $10,000 per-employee-per-year (PEPY). Was this really a successful three-year run?  No. You should be ticked off with this performance. because YOU WERE PAYING TOO MUCH TO BEGIN WITH. For comparison, the average cost of providing a group medical plan in the state of Colorado is $8,160 PEPY. The average cost of providing a group medical plan in the U.S. is $9,504 PEPY.. By spending more than $10,000 PEPY, you are spending more than the average U.S. employer and significantly more than the average employer in Colorado. Now, plan costs can differ based on industry and location, but the message here is clear. Do not be satisfied with merely beating industry averages. It is too easy to be satisfied when you are only comparing your current costs with your previous costs. If you are an employer that is already spending too much, it is time to challenge your broker and the status quo. Dig in and find out why you are paying too much, and begin implementing the appropriate cost-containment strategies that will help you reverse the cost increases (albeit small) that have affected your plan for far too long.