Charting the Path for Workers Compensation Claim Management

With so much discussion about claim benchmarking, treatment protocols and the like, did you ever wish someone couldjust point you in the right direction? This analysis o)Cthe detailed workers compensation [WC] claim data now becoming available to researchers leads to a picture that resembles a simplified navigational chart. As described in the paper, that map--together with a few rules--provides powerful and potentially valuable guidance in administering WC claims. Cost analyses are often issue driven. Consequently they tend to be focussed on a single cost liability. Medical costs, wage replacement benefits and loss adjustment expenses are the major categories in WC insurance. The focus is usually on determining their individual, ultimate cost liability. This paper describes some findings based on a new way to model claim costs that puts as much emphasis on their timing and interaction as on the costs themselves. As an illustration, back strain cases are looked at taking note of the mix between medical and lost time benefits. The major finding is hardly a surprise: mix matters. What might surprise you are the prospeets for translating esoteric theo~" into practical guidance.