Worker Compensation Injuries: Best Practices for Construction Firms
By Meghan Bankhead
Workers compensation claims are an inevitable part of commercial construction. Even the safest construction company in the world will eventually have an employee get injured on the job. The costs of work-related injuries are high, both directly and indirectly. Direct costs include increased premiums, but work-related injuries can increase a company’s experience modification and make it harder for them to bid jobs. It also can cost them productivity, a valued employee, and the resources to replace that employee.
The costs of work-related injuries can be mitigated if the appropriate risk controls are put in place prior to the occurrence of an injury. Such risk controls are comprised of an aggressive set of Best Practices in three key areas: Injury Prevention, Accident Response and Claim Management.
The best claim cost mitigation tool is, of course, injury prevention. The single most important practice to employ toward that end is a comprehensive safety culture. When safety is important to every member of the company, from top management down, the frequency and severity of work-related injuries will diminish.
If a construction firm doesn’t already have one, they should establish a Safety Committee that includes a member from each department. This creates “buy in” and a sense of responsibility from the CEO to the hourly employee. When everyone “owns” the responsibility for safety, everyone takes it seriously. The committee should review all injuries and near-misses every month, and collaborate on safety controls that can be put in place to prevent recurrence. The committee should also encourage and review safety suggestions from the entire company. This can be done via a suggestion box or other method of anonymous communication.
Once an incident or injury occurs, the events of the next 24 hours will have a huge impact on the ultimate cost and outcome of the claim. It is critical to be prepared to respond quickly and efficiently to any injury. Everyone in a position of responsibility within the firm should be trained in Post Accident Response. This should be done even if the company rarely has injuries, because an infrequent claim history makes it more likely that employees and supervisors will not know what to do in the event of an injury, and may inadvertently make a decision that could adversely impact the length or cost of the claim. Construction firms should implement the following key aspects of an accident response program.
Medical Provider Network (MPN)
In California, employers now have the ability to direct medical care to an approved network of physicians and treatment facilities that meet criteria established by your workers compensation insurance company. These facilities often have agreements with the insurance company to bill at a discounted rate. Choosing a medical clinic is a very important part of the pre-claim process. It is best to visit several clinics in the area, and choose the clinic that best suits the company’s needs in terms of hours, ease of access, services and treatment types available onsite, staffing, administrative support, and the clinic’s philosophy regarding First Aid programs.
Once a construction firm has chosen a clinic, establishing a relationship and a rapport with the physicians and administrative staff can be invaluable if a serious or suspicious injury occurs. Making sure injured workers receive prompt and thorough medical treatment will shorten the length of treatment and disability, and increase the chances for a speedy recovery and claim closure. Discussions with employees about their satisfaction regarding the treatment they received at your chosen medical facility can help a company evaluate, on an ongoing basis, whether or not to continue the relationship with that clinic.
First Aid Program
Establishing a first aid program allows a company to pay for qualifying injuries out of pocket. This will keep those injuries from affecting the firm’s claim experience and experience modification. In California, employers have the right to pay bills for first aid treatment, and do not have to file a formal injury report with the insurance company. Section 14311(C) of the Workers Compensation Rules and Regulations defines first aid as follows: “First aid is any one-time treatment, and any follow-up visit for the purpose of observation of minor scratches, cuts, burns, splinters and so forth, which do not ordinarily require medical care. Such one-time treatment and any follow-up visit for the purpose of observation, is considered first aid, even though provided by a physician or registered professional personnel.” The construction firm should advise its clinic that it has a first aid program and would like to pay these bills out-of-pocket. Whether an injury meets the qualifications for first aid is a doctor’s determination, and attempting to pay bills out of pocket for injuries that, according to the treating physician, do not meet the requirements for first aid is not recommended.
Injury Reporting Procedures
It is imperative that everyone in the company understands what their responsibility is when there is a workplace injury. A reporting protocol should be established. Every employee should know to immediately report any work-related injury, no matter how small and no matter whether or not they think they need medical treatment. Every employee should know to whom they should report their injury, and there needs to be a system in place to ensure that report gets to the proper person so the next step can be determined. If all employees are responsible for reporting injuries to their supervisor, every supervisor needs to know what their responsibilities are.
Once a claim has been reported, a claims adjuster will be assigned who should contact the company within 24 hours. The company’s employee and his or her physician should also be contacted during this time frame. It is important to keep current on the claim developments, and discuss expectations with the adjuster. The company’s broker should have someone assigned to assist with this process and facilitate communication. Your broker can be an invaluable resource for you, and should make certain the claim is being handled proactively: negotiating reserves on your behalf, advising you on how to respond to developments, and pressing the insurance company for swift resolution.
The ability to reduce the frequency and severity of employee injuries can make a huge difference to a construction company’s bottom line. Construction firms will never be able to eliminate construction injuries. However, if they proactively focus on injury prevention, accident response, and claim management, they can substantially improve the company’s risk profile, which will drive dollars to their bottom line.
Meghan Bankhead is the claims specialist and loss control services assistant for Cavignac & Associates, a risk management and commercial insurance brokerage firm in San Diego.