Administering workers’ compensation claims is a complicated process. The complexity surrounding premiums, injury and claims management, and return-to-work programs often end up costing businesses more than it needs to, as well as eating up valuable time and staff resources.
Here are nine reasons why you may want to outsource workers’ comp to a knowledgeable business partner:
There is no single set of rules.
With commercial health insurance, providers generally work within the same processes, procedures, and sets of rules. This is not the case with workers’ comp. Each state sets its own intricate statutes, reports, and treatment plans – and if you fall short of adherence to any one of them, your claim may be rejected.
Calculating employee wage entitlements can be confusing.
Specific state statutes also layout when and what should be paid and how to calculate an employee’s wages while they are on workers’ comp. This can be complicated even for experienced claims managers, and easy to get wrong from a payroll perspective.
Workers’ comp is highly specialized.
It’s a completely different animal from standard health insurance. Health plans that offer workers’ comp does not sell commercial insurance or vice versa. If a provider fails to capture the correct information, a claim could be submitted to the wrong payer or to a third-party administrator (TPA), which could delay reimbursement time or risk a filing violation.
Initial authorizations must be verified.
Before a provider can file a workers’ comp claim, they must obtain an employer’s letter of protection or first report of injury. Otherwise, the entire claims and reimbursement process could be severely compromised.
Workers’ comp requires a high level of expertise, yet accounts for only a small amount of income.
While it’s very difficult to manage, workers’ comp typically accounts for only a small percentage of an average company’s accounts receivable. It’s probably not worth having a dedicated comp expert on staff – yet you need that level of expertise.
It’s still a paper-based process.
As incredible as it may seem, most workers’ comp claims still need to be filled out on paper. This is a slow, labor-intensive process. And if even a single piece of paper is submitted out of order, the entire claim may be sent back, requiring that the entire process be started over.
Intricate fee schedules must be followed.
Failure to understand what is allowable under the complicated maze of state workers’ comp statutes can lead a provider to deliver services that will not be reimbursed.
Follow-up is another area that demands specialized expertise.
Even if everything is submitted properly, reimbursement may not be timely, unless diligent follow-up is done. This becomes even more critical if a claim is rejected and an appeal needs to be filed.
Every reimbursement must be verified for accuracy.
Each comp payment must be checked to ensure there has been no over or underpayment. This includes verifying that payments have been based on current fee schedules.
Need HR Help? Key HR Can Help Your Business
Through our professional employer organization (PEO) services, Key HR can work on your benefit to manage workers’ compensation claims, premiums, regulations, injury management, and return to work programs. By partnering with us, you can ensure the best possible outcomes for your employees, your business, and your bottom line. Contact us today to learn more.
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- On September 15, 2021
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