Tag Archives: bls

An Easy Way Forward on Health Costs

The fastest way for insurers to lower healthcare costs is also the easiest way to improve how people care for themselves and others. In three words, the way forward—for insurers and individuals—is basic life support (BLS). In three letters, the way to save a life is through CPR. If insurers provide incentives to customers to learn CPR, if people take CPR certification courses, we will have reason to rejoice. We will have more people with the ability to respond to a life-threatening emergency with a life-saving procedure. Patients will, in turn, have fewer hospital stays and quicker recovery times. This invaluable procedure will yield valuable savings in time and money, too.

Insurers must lead this effort, infusing the public with a sense of purpose by purposefully improving people’s confidence about what CPR can do. By explaining why CPR is a necessity, insurers can show people how to save lives. When every second counts, people can then count on themselves to not only be good Samaritans but to also deliver the goods, so to speak, when there is no time to wait for first responders to arrive on the scene or paramedics to provide additional help.

People who can administer CPR possess the best insurance policy: life itself. That policy is portable. It transcends cities, counties, states, countries and continents. It is a policy for personal empowerment and public enrichment, offering what no amount of money can match and no measure of fame can equal. It is a policy to save lives and strengthen communities.

It is also a policy to advance the interests of the insurance industry. It is a policy with no liabilities and many rewards, both professional and personal. The former is a reward that puts insurers at the forefront of innovation involving science, technology, and medicine. The latter rewards policyholders—and feels rewarding—because of what they alone can do: save lives.

See also: The Science That Is Reinventing Healthcare  

CPR is too important a skill not to learn. It is too vital to life and longevity for us not to recognize its benefits. It is too indispensable for a health-conscious citizenry not to know its advantages. It is too advantageous for insurers not to acknowledge its worth. It is too worthwhile for a community not to accept its virtues.

By promoting CPR, insurers can convert their support of life-saving techniques into a lifetime of savings for their respective clients. Insurers can reinvest that money by expanding coverage or making coverage more accessible to those who need it but cannot afford it. Such is the ROI of CPR: a skill that works—a skill that every worker should study—for the good of all people.

Too convenient a chance not to capture, now is the time to seize an opportunity that can secure the credibility of insurers and sustain the safety of policyholders—of people—nationwide. If insurers fulfill that mission, the dividends will accrue for generations to come. Together, insurers and individuals can accomplish that mission.

The Opportunity of a Lifetime

If insurers want to know the future, or to see the best approximation of it, they should review the events of 2018 so they can prepare themselves for the excitement of 2019. They should expand their emphasis on the theme of safety by rewarding companies and individuals for, respectively, teaching and learning basic life support (BLS) skills.

Chief among these skills is CPR. It is a skill that saves lives by saving the world entire, by rescuing the entire economy, too, because the savings for insurers are substantial. These savings translate into more affordable and accessible insurance. They reduce the number of death benefits (an oxymoron, indeed) that insurers otherwise have to honor on behalf of a decedent’s loved ones.

They also allow insurers to better promote life-saving techniques like CPR, which is itself a reminder of how the simplest things sometimes yield the greatest returns, some of which are measurable while others are of incalculable worth.

My advice to insurers is to partner with the best, for the best reasons, to achieve the best results.

My advice is to seek, and to subsidize, the work of an organization such as National Health Care Provider Solutions (NHCPS), whose mission is to save lives, whose Save a Life Initiative empowers people to learn how to perform CPR, whose many initiatives enable men and women to become CPR-certified.

See also: Digital Distribution in Life Insurance  

If insurers take this advice, they will at least improve the odds that someone can save a life.

They will go beyond the merely fiscal by accomplishing the metaphysical, placing in people’s hands a skill that expresses itself in the universal language of action. It lets people do for themselves what time does not permit others to do for someone in need of immediate medical attention. It enables members of a community to be the first ones to respond when there is no time to wait for first responders to arrive on the scene of a crisis or an emergency.

To do these things is to strengthen the bond between insurers and individuals.

To do these things is to do the right thing, period, because ethics trump economics. That is to say, if insurers put morals ahead of money, they will establish goodwill among the very people they want to reach. They will have a degree of credibility no amount of advertising can buy and no attempt of marketing can match.

They will have authenticity, thanks to their commitment to BLS and CPR.

That commitment should increase in 2019, as it can increase the number of lives people save.

See also: New Health Metrics in Life Insurance  

It can also save the insurance industry from wasting time and money on more costly, and far less effective, efforts.

It can—and does—remind us to prioritize what matters most: life.

Inspired by professionals, and imbued with the ability to act with the utmost professionalism, BLS and CPR offer insurers the opportunity of a lifetime.

Now is the time for them to seize the moment.

baseline

Baseline Testing Provides a Win

According to the Bureau of Labor Statistics (BLS), the incidence of musculoskeletal injuries (MSD) cases for heavy and tractor-trailer truck drivers increased to 355.4 cases per 10,000 full-time workers in 2014, up from 322.8 in 2013. This is more than three times greater than the rate for all private sector workers.

Companies are faced with increasing exposure from MSD claims, not only from state regulations but from compliance with federal mandates that increase potential exposure for these types of injuries. (The Centers for Disease Control and Prevention (CDC) defines MSD as injuries or disorders of the muscles, nerves, tendons, joints and cartilage as well as disorders of the nerves, tendons, muscles and supporting structures – the upper and lower limbs, neck and lower back – that are caused, precipitated or exacerbated by sudden exertion or prolonged exposure to physical factors.)

Safety will always play a role in mitigating risks, but, no matter how safe an environment, an employer will always have MSD claims. In the transportation industry, the higher rates of injury can be attributed, in part, to several factors.

The nature of the work is one. Many drivers maintain a poor diet, rarely get enough sleep and are sedentary. As a result, they find themselves more susceptible to heart attacks and diabetes, as well as a myriad of strains, sprains and other musculoskeletal disorders.

Additionally, the percentage of older workers is higher in transportation than in most industries, with the Transportation Research Board estimating as many as 25% of truck drivers will be older than 65 by 2025; that translates into more severe musculoskeletal disorder claims.

So, how can a transportation company turn this around and provide a win for all parties? Let’s explore through a case study:

Marten Transport is a multi-faceted provider of transportation services offering over the road (OTR), regional, intermodal and temperature-controlled truckload services. The company has 15 operational centers and more than 3,670 employees and contractors. It needed to provide better care for MSD injuries while not accepting liability for injuries occurred outside the scope of work. Marten decided to institute the EFA Soft Tissue Management (EFA-STM) program in February 2015 to determine which injuries were work-related and which were not, as well as to provide better care.

According to Deborah Konkel, the work comp claims manager for Marten, the company uses the EFA-STM “as a fact-finding tool to help us, our employees and their medical providers better understand the nature of their injury and determine the best course of action going forward.” Under the EFA-STM program, workers are given a baseline test that is unread; after a reported injury, a second test is conducted. That data is compared with the baseline test to identify the new acute condition, distinct from any pre-existing chronic conditions.

The EFA-STM program is a paradigm shift in workers’ compensation because it provides benefits for all stakeholders by accurately separating work-related injuries from those that are not work-related and by providing objective information and, thus, better care for the work-related condition. The key question is what the physical condition of the employee was before the incident and what needs to be done to return him to pre-injury status. EFA-STM provides the required data.

To determine the benefit of the EFA-STM program, Marten’s workers’ compensation claims data from 2010-2014 was compared with claims data from 2015. The average rate of MSD injuries per 100 hires from 2010-14 was compared with the 2015 rate. The result was a 60% drop in the rate of MSD injuries per 100 hires in 2015. This translated into almost 40 fewer MSD claims in 2015. Using the 2010-14 average cost per MSD claim, the EFA-STM program yielded a direct ROI of 3.7: 1.

“Based on these results, we believe that the EFA-STM program has been a win for all parties involved and a must for companies, especially in the transportation industry” Konkel said.

What’s the Cost of the Polar Vortex?

Long-range forecasts don’t all agree on the weather or how we label it, but another winter of extreme cold may be upon much of the nation. I’m personally convinced one is because even where I live, in Tennessee, my dog, Max, is vocally rejecting his outdoor house at night — and that doesn’t usually happen until January. While Max and I, having lived in the South all our lives, may be wimps when it comes to the cold, conditions are clearly calling for an alternate plan. And that brings me to today’s topic: From a workers’ comp and safety perspective, did last year’s polar vortex provide any important lessons?

Slips and falls

Slips, trips and falls, according to OSHA, contribute to 15% of all workplace fatalities — second only to motor vehicle accidents. WorkCompWire recently reported that nearly one-third of all workers’ comp claims in the Midwest last year were because of slips and falls on ice and snow, doubling the rate of the previous year.

This data, from the Accident Fund and United Heartland, represents only five states, so I don’t want to say we have a national trend — but I am eager to see 2013-2014 data from the Bureau of Labor Statistics or other major sources. Would it be surprising if percentages were even higher in areas where extreme winter weather is rare?

While it will be another year before the first “polar vortex” slips and falls from late 2013 show up on experience mods, I thought it would be interesting to set up a few scenarios and with the help of ModMaster illustrate how an increase in these accidents might affect an employer’s experience mod and premium.

The cost in terms of mod points – and increased premium

For the following scenarios, I assumed an average slip and fall on the ice would cost $22,000, which is in range of varied statistics I found on the web. Of course, an actual slip-and-fall expense could vary from very little to tens of thousands of dollars, depending on complications and time away from work. As you see below, whether the loss is kept as a medical-only loss or involves indemnity makes quite a difference – although, in actuality, an indemnity claim is probably going to be quite a bit higher than $22,000. As a reminder, in most states, medical-only losses are reduced by 70% because of the experience rating adjustment (ERA) rule of the experience rating formula.

For the first scenario, let’s imagine a relatively small machine shop with about $1.5 million in annual payroll. This company’s minimum mod is 0.79, and the manual premium is $75,000. As you can see below, a single average slip and fall would increase the mod by 8 points (on a scale of 100) and increase the premium by 10% – unless the claim is kept medical-only, in which case the impact would be only 3 mod points and about 3% of the premium.

Polar1

In a second scenario, let’s imagine another small company, one that consists of office workers. Because this company’s expected losses (not shown) are much less than in the first scenario, the company’s minimum mod isn’t as low as our first example. Furthermore, the impact of a single slip and fall is much more significant in terms of mod points. However, this company’s manual premium is only $5,000 — so while the premium impact of the slip and fall may not seem too significant in dollars, the percentage increase of their premium is notable.

Polar2

Finally, I wanted to see what kind of impact  several slips and falls might have on a larger company. My mind is already on holiday baking, so let’s imagine a cookie factory of several hundred employees and about $20 million in annual payroll. Then let’s imagine that, during a particularly bad patch of weather, seven people slip and fall in the parking lot and three more slip and fall in an entryway that has become wet with melting ice. For this company, which has a minimum mod of 0.43 and a manual premium of $500,000, those 10 slips are still a hefty impact if they’re not held to type 6.

Polar3

For the examples above, I’ve depicted companies whose workers are not primarily assigned to environmentally challenging conditions. Imagine the spike in injuries and cost for companies whose employees are exposed to cold stress.

‘The tip of the iceberg’

Slips and falls certainly aren’t the only winter issue. Workers’ comp and insurance news and blogs are populated with lists and stories of all types. Consider just a couple:

1.  A recent story in Business Insurance concerns an employee injured when her employer gave her a ride in the floor of a company van during a snowstorm. While the employer was clearly trying to help out its employees, this employee is due benefits, a NY court ruled, because she was still on the clock, and the employer “took responsibility for the inherent risks of transporting its employees from the worksite.”

2.  Although it’s not mentioned as a weather-related issue, it’s easy     to imagine that a situation like this wet floor case could have developed because of rain or snow. The moral of this particular story? A “wet floor” sign is a safety device that an employer must ensure is utilized, not just made available to custodians.

Regardless of the cause of any injury, a popular analogy in risk management is that the cost of workers’ compensation insurance is just the “tip of the iceberg.” In addition to direct insurance, medical and indemnity costs, the full costs include administrative expenses, potentially significant impacts to a company’s productivity and the injured employee’s overall well-being. By the most conservative estimates, an average slip of $22,000 may actually cost twice that — and by some estimates may approach $100,000 in total costs.

Summary

As the examples above show, the experience mod and cost impact of winter-related accidents are sure to vary considerably from one accident and one company to the next. Regardless of exact cost, the reported uptick in slips and falls on ice and snow should serve as a flare on a snowy roadside, reminding us that every company, regardless of its size or geographic location or the type of work it does, needs some level of preparation for extreme weather in terms of policy, operations and equipment. (Broker Briefcase is a good resource to help.)

Even before I read the news about the increase in Midwestern slips and falls, a prevalence of winter-related slips and falls had stood out to me in loss runs that I occasionally see in the process of assisting clients. Have you seen evidence of this, as well? How are you helping your client or company understand the potential cost of just one winter weather loss, and to prepare as much as possible for avoiding or mitigating that loss?

I’d love to hear your thoughts in the comments below.