Tag Archives: cost per claim

Better Management of Soft-Tissue Injuries: A Case Study

The Gatesway Foundation, a nonprofit organization in Tulsa, OK, had seen an increase in its work-related musculoskeletal (MSD) cases, which the U.S. Department of Labor and Occupational Safety and Health Administration (OSHA) define as injuries of the muscles, nerves, tendons, ligaments, joints, cartilage and spinal discs. These types of disorders, commonly referred to as soft tissue injuries as well as sprains and strains, most often present as injury or pain of the back, neck, shoulder or knee and are a major source of disability. According to the 2010 report by the Bureau of Labor Statistics, the disorders account for 29% of total cases.

The Gatesway Foundation was experiencing both an increased frequency of claims and a rise in the cost of treatments, so, in 2012, the foundation began employing the EFA’s soft-tissue management program to compare pre- and post-loss data to accurately distinguish if there is acute pathology after a work-related injury. The program determines if pathology arises out of the course and scope of employment. A baseline test is conducted at the time of hire and compared with post-incident tests. State workers’ compensation laws may have many differences but have one thing in common: The employer is only responsible for returning the individual to pre-injury status. 

In the past, determination of pre-injury status, especially for soft tissue injuries, was often guess work.  Having objective findings can prevent costly misdiagnosis, unnecessary or inappropriate surgery, prolonged treatment periods and fraudulent claims. Employees also receive better treatment for compensable conditions.

The Gatesway Foundation began its program in April 2013 and had no MSD claims or OSHA recordables until Sept. 17, when a 52-year-old health care provider reported that a patient had fallen on her.  Initially, her complaints included her arm and shoulder. By the time she saw a doctor, her pain included her back.  The physician ordered a post-loss test for comparison with the baseline test.  The comparison showed a minimal increase in lumbar muscle spasms that decreased with stretching.  Two sessions of physical therapy were prescribed, and the employee has returned to work.

In the adjuster’s words, “This could have involved a great deal more expense and possible lost time without this information” from the baseline test. The program enabled the physician to have objective information and allowed the injured worker to receive appropriate care.

The program has drastically reduced the Gatesway Foundation’s soft-tissue-related workers' compensation claims.  The year prior to initiating the program, the foundation’s developed losses were $1 million. In the first six months of the policy year, before starting the program, the developed losses were $500,000. With the implementation of the program, the developed losses in the last six months of the policy year were $30,000.

A detailed analysis of the data revealed a dramatic decrease in the cost per claim when a baseline test was conducted.

Average Cost of Sprain Strain Claim Since Sept 2011
Without Baseline $18,794
With Baseline $2,241
% Reduction With Baseline 88%

This resulted in a dramatic return on investment (ROI)

Reduction in Claims Cost $316,544
Total Program Cost $9,200
ROI (Impact to Claims) 3,441%

The utilization of this book-end strategy allows for unprecedented access to information and allows for better treatment.