Far too many work comp industry CEOs are dinosaurs.

Joe Paduda

Their refusal to adapt to today’s labor market will ensure they fail their investors and policyholders.

Two things triggered this post.

1. An extensive conversation — or rather, a series of conversations — with the CEO of a very large payer whose workers are no longer required to work in the office. When I asked about work from home, this eminently reasonable individual was mildly surprised, saying something like, “Of course we support WFH. There’s no reason for most of our folks to go to an office. They did just fine during COVID and like WFH, so why change?” This person noted that real estate and related costs would be reduced, as would other expenses associated with an office-based work environment.
2. A conversation with the estimable Bill Zachry, a person I am fortunate to consider a good friend and mentor. Bill noted the challenges payers are experiencing in finding and keeping adjusters.

It seems wildly obvious that WFH will help payers keep and find staff while lowering overall costs, significantly reducing unallocated loss adjustment expenses. Every payer C-suite has been on a cost-cutting rampage for several years in an effort to improve margins and adapt to declining frequency and shrinking rates.

In what can only be described as a logical fallacy, many payers are now “requiring” staff to return to the office for more than an occasional day.

Good luck with that.

Most people do NOT have to work in an office, yet many CEOs refuse to accept that they, the Tyrannosaurus rexes of our time, cannot bend lesser beings to their will.

Sure, many workers are already back in the office, and some few prefer it. But most would much prefer:

• Not having to deal with child care emergencies by taking paid time off.
• Not commuting.
• Not dealing with office politics.
• Not wasting time at birthday parties, Monday morning “how was your weekend” chats, water cooler analyses of whatever sporting event, updates on officemates’ kids amazing school/sports/music/theater/other or the millions of other time-wasters engrained in office-based work.

Shockingly, workers would much prefer to spend the two hours or so a day commuting with their family or doing work or exercising or gardening or whatever.

And they’d rather save big bucks by ditching a car and its attendant insurance, license, tax, toll and maintenance costs; giving up the monthly commuting pass; not paying to park; having lunch at home; and on and on.

To be sure, there are arguments, some of them even reasonable, in favor of in-office work. Yet the fact that almost every organization survived COVID WFH is a rather compelling proof statement that WFH works.

What does this mean for you?

Mesozoic-era management will fail, as will its proponents and the organizations they lead.

Joseph Paduda is co-owner of CompPharma, a consulting firm focused on improving pharmacy programs in workers’ compensation. This column is republished with his permission from his Managed Care Matters blog.