The Power of Claims Advocacy: Thriving in an On-Demand Economy
BY: Peter Rousmaniere, Risk Management Consultant & Writer
& Rachel Fikes, cXO & Study Program Director | Rising Medical Solutions
The workers’ compensation industry is in the throes of internal debate about mission and purpose. Some claims leaders say that payer organizations should transition away from a compliance-oriented and, at times, adversarial style to an “advocacy” style of claims management. Hundreds of industry professionals met in March at an Alliance of Women in Workers’ Compensation event to explore this concept.
Research, too, indicates that claims advocacy is top of mind for industry executives. The responses of 700 participants in Rising’s Workers’ Compensation Benchmarking Study confirm that many claims leaders know the building blocks of advocacy and recognize its potential value. Considering its trending focus, the 2016 Benchmarking Study plans a deeper exploration of advocacy in its June survey.
In preparation, we recently interviewed claims leaders to better understand the practical meaning of the concept, as it applies to all claims operations, from self-administered employers to insurers handling claims for thousands of policyholders.
What is Claims Advocacy?
We asked Noreen Olson, Workers’ Compensation Manager with Starbucks, for a definition of advocacy. (Starbucks employs 180,000 “partners” worldwide and has close to 12,000 outlets in the United States.) Olson proposed this:
“In workers’ comp, advocacy is a process grounded by the values of dignity, respect and transparency which coordinates activities to assist the injured worker effectively, promote expectancy and engagement in recovery, efficiently restores (and often improves upon) health and well-being, and resolves the experience in mutual satisfaction.”
Others we spoke with endorsed this or a similar definition. They all have in mind not a checklist, nor a charm offensive, but a culture. A claims culture that makes access to benefits simple and builds trust – and one which must be supported by executive buy-in, organizational values, technology, and operating systems to be successful.
Advocacy is not a checklist, nor a charm offensive, but a claims culture that makes access to benefits simple and builds trust.
Access to benefits from the worker’s perspective includes ease of filing a claim, ease in obtaining prescribed medications, access to medical specialists, and help in navigating the healthcare maze. Along the course of injury recovery, there are many opportunities that affect access and trust as perceived by the worker. The highly respected Workers’ Compensation Research Institute reports in its Predictors of Worker Outcomes Series that “trust” is a key driver of claims outcomes.
Tom Stark, Technical Director of Workers’ Compensation at Nationwide Insurance, told us that advocacy has been around for a long time. He’s practiced advocacy since the 1980s. Several forces converge to promote advocacy in claims today. Claims leaders are emphasizing, or perhaps “reemphasizing,” the importance of interpersonal relations. As claims handling has shifted from onsite home visits to lower contact models, the importance of emotional intelligence, soft skills, and customer service skills is greater than ever to dispel uncertainty and engender trust.
Perhaps the biggest driver of customer service and transactional speed is the American retail sector. Its massive engagement in these areas has shaped everyone’s expectations – of all generations. Millennials, born in the 1980s and 1990s, in particular have grown up with this customer-focused approach and therefore bring to the claims environment high expectations for both delivering and receiving quality service. Slow, bureaucratic responses can shock injured workers. Darrell Brown, Chief Claims Officer at Sedgwick, says, “We are now an on-demand economy. That is the way it is.”
The on-demand economy has created cultural and multi-generational expectations around service, speed and simplicity.
Why is Claims Advocacy Attractive?
Brown says that engaging the injured worker is key. Fast and helpful response to injury pays off in worker satisfaction and lower claims costs. “People file claims but they don’t know what is going to happen. If you lose injured workers at the beginning of the claim, to anxiety and fear, they go to litigation.” Brown also says that when claims professionals engage more constructively with injured workers, their own experience is better. This leads to better morale and talent retention.
For employers, claims advocacy provides a special opportunity to directly align work injury response with their corporate brand, core values, employee communications, and benefit delivery.
Walking the Walk
Albertsons Safeway, with over a quarter million “associates” in 34 states, has crafted its claims approach to reinforce engagement and confidence for the injured workers. Director of Managed Care and Disability Denise Algire, who is also the principal researcher for the Workers’ Compensation Benchmarking Study, says that their staff talks with injured employees on the day of injury. “We focus on education and reducing uncertainty,” she says. They avoid potentially intimidating or antagonistic terms like “adjusting,” “examining,” and “investigating.” They also start with the positive expectation that every employee wants to return to work. “Workers’ compensation has become adversarial because we manage the system based on the deceptive few versus the deserving many,” she says. “Our claims approach is based on the majority, not the minority.”
Brown talked to us about tangible actions. “If you can make a compensability determination in two days, even though the law gives you 14 days, imagine how much uncertainty and anxiety is removed,” he says. “The same applies to indemnity payments. The industry is often guided by regulatory requirements. If you can take action and make payments sooner, why make it later? You’ve got to walk the walk.” Starbucks, for example, direct deposits indemnity checks into employees’ accounts to increase speed.
“If you can take action sooner, why make it later?”
– Darrell Brown, Chief Claims Officer, Sedgwick
Advocacy does not hinder organizations from being compliance-minded. Rather, it becomes one aspect of a holistic, customer-driven framework that aims higher than the bar often set by regulatory standards.
Barriers to Overcome
Stark sees lagging technology as getting in the way of engaging the injured worker. To him, claims tasks grew exponentially while support staff in claims offices were cut. Claims technology has often not kept up. He says, “Look at the work-arounds – count the number of sticky-notes on the adjuster’s screen. If technology is not there to support effective claims management, even in its most transactional form, you are really stressing the model. How are you going to be an advocate?”
“A true cultural shift will require organizations to move beyond performance metrics that are based primarily in cost containment to those based on clinical quality, functional outcomes and patient satisfaction.”
– Denise Algire, Director of Managed Care and Disability, Albertsons Safeway
Olson brought up two challenges that Starbucks has solved but still confronts most employers. She believes that is it important to make it as easy as possible for a partner to report an injury. At Starbucks, they not only have web, mobile and call center options, they also allow partners to self-report their injuries versus going through their manager and/or HR.
Olson additionally stresses the importance of easily transitioning the partner to other benefit programs if the injury is not compensable and to avoid language like “your claim is denied.” She says that placing the award of benefits in the “right benefit bucket” needs to be done seamlessly so that the partner does not feel on the hook. In addition to the state mandated language in these instances, Starbucks includes their own letter which communicates that, while the claim isn’t eligible for workers’ comp, the partner may be eligible for other benefits to help with their injury/illness.
One barrier that Algire notes – simply “rebranding” claims adjusters as advocates is not enough. “A true cultural shift will require organizations to move beyond performance metrics that are based primarily in cost containment to those based on clinical quality, functional outcomes and patient satisfaction,” she says. This shift is critical to “walking the walk” and reinforcing the advocacy approach with claims staff.
The on-demand economy has created cultural and multi-generational expectations around service, speed and simplicity – giving workers’ compensation a blueprint for claims advocacy. Embracing consumer-driven models around injury recovery is emerging as a competitive advantage, both from a claims outcomes and a talent recruitment/retention perspective. The 2016 Workers’ Compensation Benchmarking Study will be surveying claims leaders on advocacy later this summer, among other pressing topics, to better understand its current application and perceived viability. A copy of the 2016 Study report and other annual reports may be ordered here.