Worker’s Compensation – What Employers Should Know… A view from your claims examiner and attorney on defending claims and minimizing exposure Holly Alderman Mark C. Peterson SHRM Idaho Employment Law Conference September 30, 2016 www.moffatt.com HOLLY ALDERMAN Holly Alderman is the Claims Assistant Manager in the Meridian, Idaho, office of Sedgwick Claims Management Services, Inc. Holly has also worked in the capacity of a ClaimsTeam Lead and Claims Examiner. Holly has successfully completed the Sedgwick LEAD Program. She has Independent Adjuster Licenses for Idaho andUtah. Her career in claims started at Sedgwick in 1995. Prior to returning to Sedgwick in 2007, she worked as an Occupational Rehabilitation Coordinator at St. Luke’s-Idaho Elks Rehabilitation Services for six years. There she had fiscal, administrative, and operational responsibility of coordinating occupational rehabilitation services, which included a multi-disciplinary chronic pain program, work hardening program, functional capacity assessments, outpatient occupational rehabilitation services, and ergonomics. MARK C. PETERSON Mark Peterson defends numerous employers and sureties at all stages of workers’ compensation matters, including at hearings and mediations before the Idaho Industrial Commission and in appellatematters before the Supreme Court of Idaho. Mr. Peterson’s workers’ compensation experience spans from small companies to some of the largest employers and insurance companies in the world. Hisexperience also includes representing employers and sureties in compliance matters before the Idaho Industrial Commission. Mr. Peterson represents multiple medical providersin various transactional and litigated matters. His health law practice includes the representation of hospitals in medical indigency, collections, medical liens, federal regulatory compliance, involuntary mental health commitments, claims against estates, and judicial confirmation of contractual relationshipswith governmental entities. His health law experience also includes representing hospitalsin licensing issues and successfully preventing the improper disclosure of mental health records by the IdahoState Department of Health &Welfare. 1
Defending Against Claims and Minimizing Employer Risks 09/30/2016 4 Team Approach • Proper claims management and defense of a worker's compensation claim requires a team approach between the employer, claims examiner and, potentially, defense counsel. The employer plays a critical role in assisting the claim examiner's ability to adjust a claim and defense counsel's efforts to defend a litigated claim. 09/30/2016 5 What's at Stake? • Direct Impact • Indirect Impact 09/30/2016 6 2
What’s at Stake? • Direct Impact: Minimizing claims exposure impacts what is referred to as the employer's experience modifier. The experience modifier is the annual adjustment to an employer's workers’ compensation premium based upon prior loss experience. A rating bureau sets premiums based upon the employer's historic loss experience over a three-year period. 09/30/2016 7 What’s at Stake? • Indirect Impact: The proper handling of workers’ compensation claims can impact the employer in many indirect ways, such as disruption in work force, retraining costs, and employee morale. 09/30/2016 8 Processing a New Claim • Reporting • Investigation • Medical Care • Claim Determination 09/30/2016 9 3
Processing a New Claim: Reporting New Claim with Report Only Treatment • No medical • Medical treatment treatment sought and and/or one day + no absence from absence from work work due to injury 09/30/2016 10 Processing a New Claim: Reporting • It is critical that an employer promptly report claims to the assigned claims examiner so claims can be properly investigated and handling of the claim will not be delayed. • Failure to promptly report injuries could prejudice potential defenses to a claim and subject the employer and surety to further liability for improper delay of supplying benefits. 09/30/2016 11 Handling a New Claim: Investigation • The employer plays a vital role in working with the claims examiner to conduct a proper investigation of a worker’s compensation claim. An employer generally has insight into the employee’s history and circumstances surrounding an injury that may not be available to the claims examiner. 09/30/2016 12 4
Investigation: Steps Taken by Employer • First Report of Injury • Written Associate Statement – These should be in writing to prevent disputes surrounding representations by employee. • Employer Incident Reports • Witness Statements – The employer should get written witness statements from fellow employees who have information surrounding the accident, relevant representations made by employee, and preexisting status of employee. – Statements by employees who are not willing to go “on the record” cannot generally be relied upon. 09/30/2016 13 Investigation: Steps Taken by Employer (cont’d) • Video and photos, both of accident and employee on the job in some cases. • If available, review and preserve onsite surveillance. Preserve surveillance covering a wide range of time prior to and after the alleged incident. • Physical evidence and vendor information (retain evidence if there is a third party involved). • Medical Reporting, work status form. 09/30/2016 14 Investigation: Steps taken by Claims Examiner • What Examiner Needs to Know From Employer: – Confirm information provided on First Report of Injury (position, pay rate, hours worked, etc.). – Facts of accident: when, where, what happened, who/what was involved, body part(s) injured, witnesses, video, when was accident reported and to whom? – Is the claim questioned and, if so, why? – Any personnel or performance issues? – Any known co-morbidities, pre-existing conditions? 09/30/2016 15 5
Investigation: Steps taken by Claims Examiner (cont‘d) – If conducted, drug test results. – Where employee went for treatment, who directed them. – Date of return to work and if they are performing regular job, wage, hours, or not. – Concurrent job? Full-time student? – Any outside activities/hobbies? 09/30/2016 16 Investigation: Steps taken by Claims Examiner (cont‘d) Employee Wages • The claims examiner is required to set the average weekly wage for purposes of time loss payments. In order for the claims examiner to set the appropriate wage, the employer needs to provide a documented history of wages. • 52-week wage history prior to date of injury – If employed > 30 days with employer but < 52 weeks: provide all wage history. – If employed < 30 days with employer: provide all wage history and also provide wages of a similar, like employee. 09/30/2016 17 Investigation: Steps taken by Claims Examiner (cont‘d) Employee Wages • Delaying a timely payment to an employee could subject the employer/surety to sanctions or attorney fees. • If overpayment made by claims examiner due to incorrect wage information, there may be impediments to recouping overpayment. 09/30/2016 18 6
Handling a New Claim: Medical Care • Designated medical provider – The employer has a right to designate a medical provider • Sign or Notice of predesignated provider at place of employment, visible to all employees 09/30/2016 19 Handling a New Claim: Medical Care • Why a Designated Medical provider? – Confidence – Contractual relationships with provider 09/30/2016 20 Handling a New Claim: Medical Care (cont’d) • Limitations to designated provider – Emergent medical care does not have to be with the designated provider – Providers within the chain of referral – Change of physician 09/30/2016 21 7
Handling a New Claim: Claim Determination • Idaho law requires that the licensed claims examiner make the determinationto approve or deny a worker’s compensation claim 09/30/2016 22 Claim Determination • The Industrial Commission has taken the position that a claim determinationmust be made within 28 days – The timeline for claims determinations illustrates the necessity for promptly reporting claims and beginning the investigation 09/30/2016 23 Claim Determination • Any delay or denial of worker’s compensation benefits must have a reasonable basis – A delay or denial of worker’s compensation benefits without a reasonable basis subjects the employer/surety to an attorney fee award 09/30/2016 24 8
Claim Determination Reasonable Bases for Denial • Employee Notice – an employee has 60 days from the date of the accident or manifestation of occupational disease to provide notice to employer – Not a complete bar if employee can demonstrate lack of prejudice to employer 09/30/2016 25 Claim Determination Reasonable Bases for Denial • No industrial accident – The term accident has been interpreted broadly to include something as simple as getting up out of a chair – An accident has been found without any pinpointed incident where a claimant cites the activity that brought on the pain 09/30/2016 26 Claim Determination Reasonable Bases for Denial • No occupational disease – The term occupational disease has been interpreted broadly to include any medical condition that was predominately caused by the nature of someone’s work – Determinations based upon medical opinion 09/30/2016 27 9
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