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Industry Insights

Zachry: The Philosophy for Assigning Claims

  • National

Within all claims operations, the claims manager and supervisor are responsible for balancing the examiners’ caseload to make sure that the examiners not only have the right caseloads but also have the right claims within that caseload. Properly done, the assignment process will allow the examiner to produce optimum results.

Bill Zachry

Bill Zachry

The right balance is based on the experience of the examiner, the support level of the claims team (number of assistants, medical professionals and attorneys to the number of examiners) and other factors that impact claims productivity. 

What is the ideal method to assign claims within a claims operation? 

In the claim world, assignments cannot or should not be the same for every self-insured client or insured claims operation. Claim assignments may be focused on specialty for a lower-volume employer and on geographic location for a high-volume employer. Managing the task of new claims assignments should be done in a way that allows examiners to do their jobs well and results in optimum claims outcomes. 

Claims operations use different methods and criteria for assigning claims to the examiners or within a claim’s unit. Insurance companies, self-insured employers and TPAs all use different criteria for assigning claims to examiners. 

Methods for distributing new clams within a claims operation: 

  • Geographically.
  • By employer.
  • By broker.
  • By claims complexity (medical only, indemnity, litigated, subrogation, settlement specialist, catastrophic, language). 
  • Alphabetically by claimant. 
  • Next cab off the rank.
  • By litigated applicants' attorney.

Issues to determine which claim to assign to which examiners include: 

  • Experience level of the examiners (and their supervisors).
  • Examiner's current claims load (number of litigated, delayed, denied, future medical care).
  • Claims frequency, claims severity and claims trends (such as litigation propensity) or claims exposure.
  • Number of litigated files in the caseload. 
  • Number and kinds of subrogation claims in the caseload. 
  • Number of service requirements in the caseload (employer, broker, insurance company, self-insured).

Premises for assigning new cases to examiners 

Premise 1 
Claims examiners will obtain optimum results on their assigned claims if he/she has the optimum caseload. For this article, “caseload” is not the number of open files but is the optimum mix of claims issues and claims service requirements. 

Premise 2
Experience and challenges make a better claims examiner. No examiner should be given the same kinds of claims repeatedly because they can become complacent. New challenges and a variety of exposures will keep the examiner engaged in the job and outcomes. 

Premise 3 
There is a natural ebb and flow of claims in every claims operation and in every caseload. This ebb and flow may be daily, weekly or annually. Some operations get a much higher number of new clams on Monday and Tuesday than any other day of the week. Some claims operations experience a higher volume of claims frequency in September when everyone goes back to work or school. Other claims operations have a higher claims frequency during the Christmas holidays. Usually, the summer season has a slightly lower claims frequency than any other season. 

Within an examiner’s caseload, all new claims take time to set up, to make the right calls to create a relationship with the employee, get additional information from the employer, determine if there will be time off work from the doctor, and to interview witnesses, etc. New claims that have questions of compensability, (AOE/COE, employment/non-employment or have subrogation exposure) take more time than new claims that are immediately accepted. Some claims operations require in-person meetings with the injured workers.

The ebb and flow are dictated by the claims processes within the operation. For instance, some claims operations use outside vendors to do AOE/COE investigations and some do the process through recorded telephonic investigations performed by the examiners. A major determinant of work activity on the part of the examiner is the level of defense attorney involvement and the level of expectation on the part of the administrator. 

Premise 4
Every employer has a unique exposure profile. Some employers may have only one claim every four years, and others may have four a day. Some employers work only on the weekdays and never have weekend claims, and some work 24/7 and have most of their injuries during the weekend. Some have only English-speaking employees, and some have employees who speak only Spanish. Some have high litigation rates, and some never have any litigation. Some have extensive return-to-work programs, and some never bring employees back to work. 

Premise 5
Brokers can impact claims activity and results depending on their sophistication and involvement in the process. If smaller employers defer to the broker for the reporting of claims or for overseeing the administration of claims, it can result in significant additional work on the part of the examiner to accurately and timely gather the necessary information to determine compensability and provide benefits to the injured worker. File reviews with some broker claims specialists may focus on reducing reserves rather than focusing on claims closure. 

Premise 6
The better the relationship the claims examiner has with the employer, the better the claims outcomes. This involves understanding which vendors the employer likes to interact with, the medical network and specific doctors assigned to the employer, the light/modified duties and return-to-work programs, drug testing protocol, the internal financial incentives that drive behaviors, and, most importantly, the process to obtain settlement authority. 

Premise 7
Every caseload will eventually have a few claims that the examiner takes personally. When this happens, move the files to another examiner. 

Premise 8
Moving files from one examiner to another can negatively impact the outcomes on that file from 5% to 20%, depending on the file facts. 

Premise 9
Segregating claims by MO, delayed/compensability, lost time, litigated and future medical has strengths but usually involves transferring the claims during the life of the case. See premise No. 8.

Before implementing this process, it is usually worth asking if there will be enough improved outcomes by having a specialist oversee the claim to overcome the additional expenses associated with transfers. Will the new examiner be able to create a relationship with the worker when the first examiner spent time creating the relationship? If the claim is litigated, the possibility of disrupting the relationship is reduced. 

Premise 10
There is no ideal caseload. Every examiner has his/her own style, pace, efficiency quotient and capacity for claims administration. Some are naturally more efficient than others. However, too many files usually result in not enough time to get all the daily tasks completed. This can seriously impair the compliance processes as well as claims results. Throughput measurement of claims (including outcomes as well as closures) may be a better measurement process than measuring or managing a static caseload. 

Front-line rules of assigning claims: 

  • Be aware of the daily and weekly workload for the examiner. 
  • Assign claims so the examiner has the proper time to create, maintain and utilize the relationships with the employer, the broker and any vendors or service providers associated with that employer and that claim. 
  • Balance the caseload with the proper level of experience.
  • Notwithstanding premise No. 8, it is usually wise to change the examiner on claims that are stale or have a toxic relationship between the injured worker and the examiner.  

Bill Zachry is a board member of the California State Compensation Insurance Fund. 

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