By FRANCES FORD
Those in risk management and human resources are challenged constantly by day-to-day decisions to ensure operations are focused on the latest processes for loss containment, mitigation, and claims resolution. These are not exactly concepts that lend themselves to dramatically exciting changes. Certainly, technology is critical in the risk management world, but once an accident occurs, no one is asking, “Is there an app for that?” There are no quick fixes for the immense complexity of handling claims that cost millions of dollars.
Innovation and insurance do not need to be mutually exclusive concepts, though. Risk and human resources professionals crave new ideas and need innovations to stay ahead of the curve and keep a competitive edge. Indemnity for workers’ compensation claims and medical losses are the greediest contenders for change. Finding new ways to tackle ordinary losses has its challenges.
Many inventions are discovered simply by observing the behavior of others and looking at ordinary situations differently. Take, for example, the behavior of injured employees following an on-the-job injury. Often, the work routine is replaced by doctors’ appointments and isolation. They may focus on their disabilities instead of capabilities, which can lead to depression and low self-esteem.
People tend to be creatures of habit, structure, and routine. Therefore, resuming a work schedule produces a number of positive results. As an industry, we tend to focus on return-to-work programs as a means of saving money on workers’ compensation costs. But effective return-to-work programs can be much more than that.
Return-to-work programs are crucial for reducing workers’ compensation costs and assisting the injured worker in transitioning back into the workforce. However, there may be obstacles that still can keep employers from implementing them properly. Therefore, to be effective, return-to-work programs have to be properly administered—and a little creativity would not hurt either.
One Size Does not Fit All
Risk managers and human resources departments are under more pressure than ever to find ways to contain workers’ compensation costs while providing for injured workers. Employers are faced with many challenges after an injury occurs and are not required to retain anyone injured on the job or out on disability collecting workers’ compensation benefits. Employers that have workers’ compensation can and must continue running day-to-day operations and backfill jobs necessary to their businesses.
The cost of lost productivity is well documented, however. Whether the employee is replaced or not, it’s a financial setback for an employer. Of course, smart employers will do everything possible to retain experienced workers. After all, it costs money to hire and retrain new employees, and it takes time for a replacement to learn everything that the injured worker knew. However, predicting the return to full duty isn’t always an exact science.
Risk managers and human resources professionals are tasked with the challenge to keep losses to a minimum. Prevention and safety is vital. But accidents are inevitable and lives and money must be managed. Every loss containment strategy must be explored and tested. This is a high-stakes venture with premiums and medical costs rising, but it would be even more costly if an employer or insurance company ignored the most important person in all this—the injured worker.
When thinking about return-to-work programs, risk managers and human resources managers should ask the following questions: Can business create an environment that improves one’s self-esteem and outlook instead of promoting a disability mindset? Can we offer employees a new opportunity that helps them recover faster, both mentally and physically?
A New Spin on an Old Idea
Not every occupation is able to accommodate light-duty work for its employees. For example, what meaningful, light-duty tasks are available for an injured steel worker, mechanic, or truck driver released to sedentary duty? In these cases, the nature of the work does not provide the resources for light-duty accommodation.
Another issue that arises is when injured workers are located in a remote location far from the corporate office, which means they receive temporary partial disability benefits until released to full duty. With no opportunities for transitional duty with their employers, they remain idle and inactive—a perfect breeding ground for depression.
If employers and risk managers are struggling to accommodate injured workers on-site, one option is to look outside the company. In the 1980s, Goodwill, a nonprofit organization, hired injured workers who were on temporary partial disability from their other jobs to help in various, light-duty roles. Not only did this give the injured workers the connection needed to regain confidence in the workplace while healing from their injuries, but also Goodwill benefited from the assistance. Though this program is no longer in operation, it helped prove that returning injured workers to jobs within their physical limitations was a benefit worth the costs.
Volunteers are the lifeblood of nonprofits, and many of them would not be able to fulfill their missions without them. In many cases, more volunteers are essential. Most local and national nonprofit organizations thrive on the necessary services of volunteers, and thus are very accommodating when it comes to providing tasks within the most limiting restrictions.
Local charitable organizations can accommodate sub-sedentary restrictions, such as handing out flyers at a museum or signing in guests at a YMCA. The assignment is temporary, supervised, and can accommodate language and geographic barriers that may otherwise prevent an employee from returning to productivity. Many large corporations enjoy developing a partnership and creating and making a social contribution by giving time and money back to their communities. This relationship can be an important tool to help injured workers regain a sense of purpose and connection, as well.
A Plan That Works for All Parties
The workers’ compensation industry tends to focus on return-to-work programs as a means of saving money on costs. As soon as an injured worker is released to light duty, implementing a return-to-work program immediately helps contain costs as well as acclimate the injured worker back to the workplace.
Though laws differ from state to state, most affirm that, if the injured worker unreasonably refuses to comply with an injury management plan, then the insurer can suspend weekly benefits. Employees essentially have three options: accept the assignment until released to full duty; decline the assignment and risk reduction or loss of indemnity or disability benefits; or seek a medical release to return to work full duty. Therefore, compliance is likely.
Effective return-to-work programs have the ability to be much more. For injured workers, transitional duty raises self-esteem, accelerates recovery, keeps skills and work habits sharp, and their salary is likely more than the temporary disability benefits. Returning to modified duty is shown to improve employees’ self-worth and results in a more positive and productive experience, which further reduces the chance of suffering and an extended disability. Also, it helps the employer retain its investment in its employees in terms of training and education, improves morale among the workforce, and, of course, saves money.
It may seem that the employer is now paying more for the injured worker and still experiencing loss of productivity and paying the costs of a replacement. However, in the long run, employers reap the benefits in many ways:
- They retain a valuable employee who is experienced and trained for the work.
- They comply with state and federal employment regulations.
- It improves workplace morale.
- It saves $8-$10 for every dollar invested in return-to-work programs.
- It reduces potential for workers’ compensation and employment litigation.
- It reduces workers’ compensation claims costs and duration, which could affect premium rates.
Risks Versus Rewards
Risk and human resources professionals must be careful to weigh the risks of offering alternative or off-site transitional duty programs. Applying consistent guidelines for administration and oversight of work accommodation policies is necessary. Employer policies may include requirements that all employees must adhere to company policies and procedures while working at an off-site location.
When determining the rate of pay while performing light duty at a nonprofit, wages should be consistent with the wages paid for on-site, light-duty work. Because many state’s partial disability benefits require payment of 80 percent of pre-injury wages, if the employer chooses to pay a reduced wage, indemnity benefits must be issued for the difference. The same is true if the employee returns to work at the employer and receives lower wages during modified duty. By retaining them on the employer’s payroll, the injured employees stay connected to the workplace and maintain all benefits. This also preserves the statutory employee/employer relationship.
Underlying Benefits
When injured workers participate as volunteers at nonprofits, research has shown that they not only benefit personally, but also they help their communities. This aspect of the transitional assignment instills great pride and boosts self-worth. For many injured workers, exposure to volunteerism and service work is a new and uplifting experience.
Risk and human resources managers know that caring for the injured worker is paramount. An innovative return-to-work program that places injured workers in local nonprofit agencies as volunteers and allows them to continue to receive their regular wages and benefits from their employers is a win-win situation for all involved—the injured worker, employer, nonprofit, and the community.
ABOUT THE AUTHOR, SOURCE
Frances Ford has over 25 years of experience in the workers’ compensation industry and is owner and co-founder of ReEmployAbility Inc. She can be reached at 813-663-9880. This article originally appeared in the CLM publication WC magazine, and is reprinted here with permission.