Ten Ways to Reduce Workers' Comp Costs
By Dean Boerger

With today’s ever-changing economy and the unforeseen risk of layoffs, shutdowns and business slowing down, it is more important than ever to implement the following basic steps to aid in reducing potential future workers’ compensation fraud and abuse claims.

Step 1 - Hiring Practices
This is where it all begins and can quickly eliminate potential problem employees from the day one. Take a look at your hiring practices, procedures and policies. Do you conduct thorough background checks? Verify work history? Check references? All of these steps can help your company avoid hiring the type of person who commits workers' comp fraud, abuses substances, or ignores safety procedures. Any of these behaviors may adversely affect your company - and your other employees. Remember that good hiring practices always comply with Labor Laws and the Americans With Disabilities Act.

Step 2 - Prevention
Workers' compensation fraud drives up the cost of premiums for everyone, even employers who have never had a fraudulent claim. That is why it is important to make sure your company does not become a victim. If you have improved your company's hiring practices (Step 1), you have already taken the first step against possible workers' comp. fraud.

For the next step, adopt an anti-fraud policy that demonstrates your commitment to fighting fraud and stresses the potential consequences of committing fraud. If you suspect fraud, contact your carrier, if you are self-insured or third-party administrator immediately. Remember: Most workplace injuries are legitimate, but statistically, claims filed by new employees or disgruntled employees have a higher incidence of fraud. As the employer, only you can identify these individuals to fraud investigators.

Step 3 - Drug-Free Workplaces
The U.S. Department of Health and Human Services (DHHS) estimates that 6.5 percent of all full-time workers and 8.6 percent of all part-time workers use illicit drugs. Employees on drugs are less productive than drug-free employees, they overuse their company health care benefits (up to eight times more than nonusers!), they file more workers' compensation claims, and they cause more on-the-job injuries - often times to their co-workers.

Employers should fight illicit drug use by combining pre-employment testing with a written substance abuse policy that includes "for cause" and random drug tests for current workers. It is also important to educate your staff about how one employee's use of illicit drugs can affect their co-workers.

Step 4 - Safety Monitoring
The best way to create a safer workplace is to empower employees to report and correct potential safety hazards before an accident happens. When everyone in the company is involved, the company develops a proactive monitoring of safety at the workplace.

Employees help eliminate potential hazards instead of reacting to accidents after the fact. Management recognizes employee input and feedback as valuable resources, and as a result, the company usually sees remarkable improvements in its safety record.

Step 5 - Incident Investigation
Immediately investigate all work-related incidents. An incident may be a work-related injury or illness, or it may be a near accident (something that could have resulted in an injury, but fortunately did not).

In fact, investigating near accidents - and taking steps to prevent them from recurring - is the best way to prevent an accident. Do not turn your incident investigations into a negative experience. Focus on finding the cause of the incident without assigning blame.

Step 6 - Record keeping
Record keeping is essential to almost all areas of management, and safety management is no exception. Records provide documentation of accidents, incidents (including close calls), and other safety-related data that can help you make your safety program a success.

You may need your records if your company is ever involved in legal or other evidentiary proceedings, such as an Ohio Bureau of Workers' Compensation (OBWC) allowance hearing. Good record keeping may mean the difference between proving that an alleged injury is or is not work-related.

Step 7 - Prompt Reporting
Prompt reporting is especially important if there are any questions about the validity, compensability, or severity of an alleged injury. Advise the employee to seek medical attention. Contact your MCO to report the injury. A managed care organization (MCO) is a private company that an employer contracts to medically manage the workers compensation claims for injured employees. MCOs are an integral part of the Health Partnership Program.

Step 8 - Return-to-Work Program
A return-to-work program will help you get your injured employees back to work in the shortest possible time. It will also help reduce your out-of-pocket costs associated with on-the-job injuries (such as lost productivity and hiring or training temporary help). Your program should be specific to your company, but all return-to-work programs include some key elements:

-Keep in touch with the injured employee during the recovery period;

-Give the treating doctor information about the employee's job so the doctor can assess when the employee can return to light or full duty;

-Develop alternative productive work or modified duties for injured employees who can not return to full duty right away;

-Make a written bona fide offer of employment when your employee is released to work in any capacity.

Step 9 - Compliance
If you have employees, you must have workers’ compensation coverage. OBWC provides insurance to about two-thirds of Ohio's workforce. The remaining workers receive coverage directly through their employers. These companies are part of a self-insurance program for large and financially stable employers who meet strict qualifications set by OBWC.

Step 10 - Education
The OBWC has a Division of Safety & Hygiene Training Center that can assist you and your staff in developing and presenting a one-hour safety presentation on several areas of concern that may exist in your workplace. These presentations are designed to help them understand and promote a safer and healthier work environment. It is recommended that you take the related DSH Training Center courses before using their online presentations. Call 1-800-OHIOBWC, and press 2 for more information.

The Bottom Line
By taking the time and making the effort to the enhance safety at the workplace; you will see a positive return to your bottom line.

Disclaimer: This information is not to be taken as legal advice, but is a guideline from established and proven sources. Employers should seek legal advice from an employment law attorney.

Dean Boerger is the chief investigator at Boerger Investigative Services, LLC a licensed private investigation company specializing in workers’ compensation fraud investigations, insurance investigations and criminal defense investigations. Boerger can me contacted at 614-481-0777, by email at dean@boergerpi.com or visit www.boergerpi.com