Workers Comp Trends for Technology in 2021 - Insurance Thought Leadership

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May 5, 2021

Workers Comp Trends for Technology in 2021

Summary:

An efficient workflow passes 60% to 70% of medical bills straight through; workers' comp has a long way to go.

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One year after the start of the COVID-19 pandemic, Mitchell International conducted its annual survey of about 100 workers’ compensation professionals to determine how technology use changed in the industry during the pandemic and how those changes will continue. The survey found:

Technology use is increasing in the workers’ compensation industry  

  • Predictive analytics and telemedicine stood out, showing that the industry rapidly increased the pace of adoption – or the desire to adopt – those technologies during the pandemic.
  • More than half of organizations report implementing telemedicine since the pandemic began, and respondents ranked telemedicine (35%) and predictive analytics (35%) as the technologies that will have the largest influence on the industry in the next five to 10 years. 
  • Claims providers are facing pandemic-related challenges and are using technology to help overcome them. Almost one-quarter (22%) of respondents ranked adapting to pandemic-related challenges as the top obstacle their organization faces today, and 40% said they believe the pandemic is the leading driver of technology adoption.
  • Despite the technology changes in 2020, the workers’ compensation industry still has an opportunity to introduce automation into the claims process. Only 23% of respondents said that their organization uses straight-through processing for 50% or more of the medical bills they manage.

Telemedicine had the most substantial impact (35%) of all technologies implemented in 2020

  • As expected, most respondents reported that telemedicine had the most substantial impact (35%) of the technologies they implemented in 2020.
  • Survey respondents also indicated that they believe both telemedicine (35%) and predictive analytics (35%) are the technologies that will have the most significant influence in the workers’ compensation industry in the next five to 10 years, compared with other listed technologies. 
  • The majority of respondents said the best application of telemedicine is or will be for provider visits (54%), followed by nurse case management (26%) and triage (21%)
  • Mobile placed at a distant third (8.5%). 

These findings aren’t too surprising, as telemedicine, predictive analytics and mobile technologies have been key focus areas in workers’ compensation for years. Prior to the pandemic, 32% of people who responded to a similar survey in February 2020 said they thought telemedicine would have the biggest impact on the industry in the future and ranked artificial intelligence and predictive analytics as the next most potentially effective technologies.

See also: Covering for a Gap in Workers Comp Data

It’s clear that telemedicine has been crucial in helping to deliver care to injured employees during the pandemic. With innovation and the addition of other technologies, such as wearables, telemedicine has the potential for broader uses in the industry and could serve a more vital purpose in helping improve claim outcomes for injured employees.

The workers’ compensation industry will see increased demand for predictive analytics 

  • Respondents list claim triage as the most popular future application of predictive analytics (35%,) followed by severity or reserving (35%), intelligent decisioning and adjuster guidance (24%) and claim automation (22%)

Indeed, these applications of predictive analytics and more will be vital for efficient and effective workers’ compensation claims processing in the years to come. From triage to automation, predictive analytics can help claims organizations get the right information at the right time to make informed and intelligent claim decisions.

Changes and pressures from the COVID-19 pandemic are the primary driver of new technology adoption

  • While 40% of respondents noted the pandemic as the top driver for change, claims organizations are still looking to solve challenges that existed before the pandemic began
  • Respondents rated efficiency (22%) as the second top driver of technology adoption, followed closely by cost containment (20%)

The workers’ compensation industry still has a significant opportunity for automation

  • Despite the rapid rate of technology adoption in the past year, less than a quarter of respondents (23%) said they automate 50% or more of workers’ compensation medical bills using straight-through processing.
  • 22% of respondents said they process 25% or fewer of their bills automatically. 
  • Even fewer respondents said their organization processes workers’ compensation claims automatically, with only 16% saying they use straight-through process automation for 10% or more of their claims, and about a quarter (24%) said they only automatically process 0-5% of claims.

Typically, an efficient workflow passes 60% to 70% of medical bills through without human intervention, and it is clear the industry still has much opportunity to reach this level of automation. Straight-through processing offers many benefits, including removing repeatable tasks from adjusters’ workloads, boosting consistency and freeing employees up to have more time to focus on complex claims that need extra scrutiny and care to help achieve better outcomes. 

While we may never achieve full automation of all workers’ compensation claims—unlike other lines of insurance, some workers’ compensation claims will always require a level of human touch. There are plenty of opportunities to boost automation now and in the future using rules engines, artificial intelligence like predictive analytics and more. As technologies become more advanced in the years to come, claims organizations will need to think about how they can strike the right balance and implement the appropriate level of automation that allows them to spend their time focusing on the claims that need special attention.  

See also: Optimizing Care with AI in Workers Comp Claims

Survey demographics

Mitchell surveyed nearly 100 workers’ compensation professionals at a range of companies, including insurance carriers, third-party administrators, public entities, managed care and risk management organizations, and brokers. The majority of respondents (75%) had 10 or more years of experience in the workers’ compensation industry.

You can find the full report based on Mitchell’s 2021 survey here.

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About the Author

Shahin Hatamian is senior vice president of product management and marketing for Mitchell International. He is responsible for product direction, marketing and strategic initiatives for Mitchell’s auto casualty and workers’ compensation software and service solutions.

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About the Author

Rebecca Morgan is vice president of product management for Mitchell’s Workers’ Compensation Solutions. Her teams are responsible for both medical bill review and claims reporting software deliveries for the workers’ compensation market.

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