Quick Tips

I Got 99 Problems But A Glitch Ain’t One – From the 2016 Work Comp Summit

By Barry Thompson:

I have taken some time to review notes from the Workers’ Comp Roundtable 2016 WC Summit. The laundry list of glitches and gripes is bountiful with few surprises. Although the notes themselves do little to move the needle they clearly show where the needle points.

The collected bulk of issues contributed from various corners illuminate a fantastically disjointed hopelessness. If nothing else, this summit is a general acknowledgement of Workers’ Comp as a systemic failure. This is very useful. Accepting failure is essential to force a widened perspective and arrest the status quo.

Accepting failure means we don’t need a complicated sorting of issues to provide sense and direction. We need to stop glitch-fixing and work from a higher level. In that spirit, only two items picked from the vast summit notes are necessary to depict the problem and re-align a solution focus:

Item #1: “Every single service provider makes more money if the case goes south” (Imperative Issues – I. a.)

Item #2: “80% of the system is working appropriately but 20% needs addressing” (Imperative Issues 3 – XXVVII. d.)

Consider that Item #1 is a truth caused by the incorrect assumption that “20% needs addressing” per Item #2. The WC claims failure rate of between 10- 20% has been an accepted statistical constant since at least the start of my career in the 1980’s. It has not changed. Therefore, I submit it is mandatory that we realize this 20% is a societal-social-human element which no part of the WC vendor arsenal can nor should be expected to fix. We need to stop addressing the 20% as if it has any outcome potential for cure and RTW and resolution.

Fueling item #1 is the decades-long growth of various for-profit interventions, managed care controls and other misguided efforts aimed at the 20%. These remain alive and well, all “going south” for profit. No one corner of the industry has incentive to change, each has a value proposition that makes some sense standing alone but falls apart and creates cross purposes in practice. Consider that most of the other summit notes are a sub-set of this fact, relating directly to glitches in execution and the lack of human consideration in the process-monster this industry has created, all assuming to address the 20%, with the backdrop of legislative pendulums swinging to over-correct and triggering counter forces to over-react.

Consider the absurdity in this simple example: what if state law required restaurants to prepare food with 20% of their raw ingredients spoiled? Would any of their dishes be fit for consumption once the 20% was blended into recipes with the 80%? What if the restaurant’s solution was to charge more money to engage more specialized cooks and more expensive spices and techniques that promised to make the spoiled parts more palatable? What if the restaurant charged even more money to predict which dishes would be the most spoiled, yet served them anyway? What if over time the entire restaurant industry saw fit to lose money on the actual menu items but have profit rely entirely on the added services aimed at placating diners’ fears over spoiled food? This absurdity is our Workers’ Comp system. 

A restaurant should be able to throw away ingredients unfit for use. It is not that simple in WC, yet is it so far-fetched to consider legitimizing the statutory marking of such WC cases early or at any stage in real-time?  Can some escape-hatch of “skipping medicine for resolution” be a legitimate mutual position from the claimant and defense side? Can the system open means for very early strategies and legal methods to dispatch the 20% without a need to pretend to “cure?”

This has happened, in small doses. Remember back when California mandated Voc-Re and it became mostly an under-the-radar holding pattern to failure and a means to propel claimants into bigger and badder disability positions? Recall the solution at one point was to allow the option for claimants to be paid the value of Voc Re, as if they attended. This situation is a legislative acknowledgement of my main point. Let’s expand this thinking on a grander scale.

Let us also agree that employers should have 90% of the responsibility to identify the 20% – they should know their employees better than any predictive model and adjusters should have the time and mandate to properly decipher real time information with employers. Further, employers should strive to reduce the 20% as part of overall workplace culture efforts, just as a restaurant supplier is expected to minimize the delivery of spoiled produce. This is not just about WC. Better employer culture serves to better overall productivity.

The industry needs to eliminate much of what it does that keeps claims churning open. Fees for claims and related services should be based on outcome performance. Eliminate rewards for false notions of “saved” medical dollars or simple transaction fees for late-timed or ill-fitted interventions. Think of how efficient the WC process would be if the 80% with outcome responsibility suddenly became the 99%. Many  managed care schemes and other interventions would become unnecessary.

Legislatively, we need an acceptance of the 20% as a societal anomaly and require judges to account for it in expressly focused court decisions. If proof for denial is elusive, we need to craft law reforms that open different avenues to resolve these cases very early under a “nuisance” presumption.

We don’t need to fix the 20%. We need very big changes that relieve Work Comp of this 20% burden. Once realized, most every other item from the summit notes will be minimized or vanquished.

(  Note: PDF downloads of complete summit notes can be found at this link http://www.workerscompensation.com/compnewsnetwork/from-bobs-cluttered-desk/23908-the-notes-from-the-workers-comp-summit-now-it-is-your-turn-to-join-the-national-conversation.html   )


Barry Thompson

About The Author

Barry Thompson is a renowned Risk Management Consultant with roots in a 1982 claim adjusting desk and branches bearing the fruit of a career-focus on improving Workers’ Compensation. He is Founder and President of Risk Acuity, LLC as well as creator and operator of ClaimAnswer.com. He began publication of Quick Tips in 2004. Each edition brings a unique independent employer-focused source of Workers’ Comp advice, information and ideas.