Workers' compensation continues to be amajor concern for employers, and while some industries have moreclaims than others, all have concerns about the associatedcosts.

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For brokers, the challenge continues to be how they can helpclients at a time when rising health care costs seem “baked in” tothe cost of doing business. But even as health care costs steadilyrise, strategies to decrease risk and moderate premiums in theworkers' compensation arena continue to evolve.

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Looking ahead to 2017, brokers will have plenty of opportunitiesto assist businesses in finding ways to keep workers' comp premiumsin check.

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Premiums are still rising

Let's get the bad news out of the way first: There continues tobe a high number of claims, and that will lead to higherpremiums.

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Workers' comp premiums are skyrocketing,”says Katharine Carey, senior commercial broker forthe CapacityGroup of New York. “For companies with more than 100 employees,especially labor-based employees, workers' comp is taking a hugetoll on their bottom line.”

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Carey is seeing a high frequency of claims, workers taking moretime off work, and high dollar amounts for the claims beingfiled.

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The rise in premiums have been documentedelsewhere: Business Insurance estimates thatpremiums increased from 5 percent to 7 percent in 2015, with somecompanies seeing increases as high as 10 percent. Insurance Journal found increasesin roughly the same range. “Escalating prescription drug costs andaging of the workforce may result in new or increased claim costs,”the site notes.

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Poor pharmaceutical management adding tocosts

According to Alexandra Leone, assistant vice president ofworkforce productivity at HubInternational, some cost savings could be realized throughbetter management of pharmaceutical benefits.

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“The trend of opioid use has been ongoing for several years, butit continues to get a lot of attention” Leone says. “We're seeingmore and more workers' compensation carriers making sure that ifclaimants are on opioids, that there's a weaning plan at the onsetof that prescription, rather than waiting until there's anaddiction or other issues.”

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Leone says another practice that increases workers' compensation costs is whenphysicians dispense drugs from their own onsite pharmacies, whichtend be more expensive. “Our clients are moving away from allowingphysicians to dispense these medicines onsite,” she says. “There isan upcharge associated with that, and the clients are paying it,when that person could just go to the Walgreens down the street andpay less.”

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Partnering with occupational medicineclinics

Another strategy being used to hold down medical costs is thepractice of working with an occupational medicine clinic. Employersin many states are barred from requiring workers' comp claimants togo to a specific clinic, but establishing a relationship with afacility that specializes in work-related conditions provides manybenefits to an employer, who can promote that clinic withoutrequiring that patients use it.

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Michael Stack, principle at Amaxx RiskSolutions and founder of COMPclub, a training program onworkers' comp cost containment, says that brokers can play a roleby getting to know the medical providers in the area.

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“Brokers can make that introduction [to employers],” says Stack.“I've worked with brokers who will go and introduce themselves tomedical providers in the area, get to know which ones are the best,and learn which ones are willing to work with employers. If thebroker can help facilitate that, that can be a useful thing thatthey can bring to the table.”

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Leone notes that different states have different rules ondirecting medical care, but even in states where employers can'tdirect claimants, they can create word of mouth support for anoccupational medicine clinic. “What we're trying to work on ismaking a soft medical referral,” she says. “We're finding greatsuccess in partnering with these doctors, where there is arelationship and protocols are already in place. So the wordspreads among the workers: 'I went to clinic X, they took reallygood care of me; I got in right away.' The better the program isdefined, the better it works,” she says.

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Technology at work

Both Leone and Stack note that innovative new programs arehelping employees get quick, convenient care, which may preventmore serious problems down the road.

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“Telemedicine is really growing, especially for clients who havea workforce that works inconvenient hours,” Leone says. “Theseemployees may be working 6 p.m. to 6 a.m.,” she says. “So if it's 3a.m. and you can't get to a clinic right away, being able to accessa telemedicine doctor on a phone or iPad is a great way to makesure their needs are being met immediately, and giving them thefeeling that they're not alone.”

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Stack says that such technology can also help get employees backto work quickly. He points his clients to an injury triage hotlinethat allows employers to connect injured employees immediately tohealth care professionals. “The ultimate goal is to get the vastmajority of employees back to work right away,” he says.

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A culture of getting back on the job

A philosophy of getting employees back into the workplace assoon as possible is crucial to holding down high-cost workers compclaims, Stack says. He notes 5 percent of workers' comp claims areresponsible for 80 percent of the program's cost. Those high-costclaims often happen when workers are separated from their jobs foran extended period of time.

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Stack says too many companies are not aware of the importance ofcommunicating with workers who are off work due to workers compclaims.

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“People who are injured [on the job] very rarely will getcontacted by their employer; even just to check in,” he says. “Theyfeel like they're black sheep—it's very detrimental to their stateof mind.”

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Stack says employees stuck at home have a higher risk ofdepression, reinjury, or turning to legal action against anemployer. Staying in touch, he adds, is a worthwhile investment ingetting the employee back to work.

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“A very simple phone call or a get-well card signed bysupervisor can make a difference,” he says.

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Leone and Stack both support back-to-work programs, which canmatch injured employees with jobs they can physically perform, evenif they are not 100 percent. She notes that an employee's absencehas direct and indirect costs. Even if an employee is not full timeat their old job, there are benefits to having them back in theworkplace.

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“Having a return-to-work program eliminates some of theseindirect costs,” she says. “It shows that the employer cares aboutthe person; that they want them to be part of the team.”

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A safe workplace

Although wellness and worker safety programs are not a newtrend, they continue to be very important in moderating workers'comp costs. Carey says there is a wide range of effective programsfor companies that want to promote safety. “Safety first, as aphilosophy, has had a large impact on a lot of companies,” shesays.

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Stack agrees that safety programs have made a difference, butadds that companies can't become complacent. “If a company isneglecting that, they will have a lot of claims,” he says. “Ifthey're paying attention to it and they have a culture of safety,it's going to make a big difference.”

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Stack adds that brokers are key players in helping companiesfind the resources to address cost drivers of workers' comp.“There's a huge financial incentive to doing this right,” he says.“I think the broker community can play a big role in educatingemployers. The brokers who do that extremely well will get a lotmore business.”

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