The need for workers comp tracking solutions has increased since the onset of the pandemic, with third-party claims management increasingly relying on automation and remote tools. The reliance on these tools has significantly changed insurance claims handling and creates a greater need for workers comp tracking.
As providers increasingly use remote technology to manage claims some organizations may benefit by using workers comp claims management software and liability tracking software in conjunction with their third-party to further minimize costs associated with claims.
The correct software solutions can have a sizeable positive impact on the bottom line when the costs associated with insurance claims and the benefits derived from better understanding claim data and return to work options are considered.
The most costly workers compensation claims
The costliest lost-time workers’ compensation claims by cause of injury result from motor-vehicle crashes, averaging $81,971 per workers’ compensation claim filed in 2018 and 2019. The only other causes with above-average costs were burns ($58,284), falls or slips ($47,681), and caught ($45,255), according to NCCI data. The costliest lost-time workers’ compensation claims by part of body are for those involving the head or central nervous system. These injuries averaged $89,347 per claim filed in 2018 and 2019. The high cost of workers compensation claims makes it worthwhile to monitor, track, and mitigate future claims.
A comprehensive claims management system should be considered for all organizations that have insurance claims and compliance requirements. Organizations using a third-party for claims management can leverage that relationship to gain better insights and work towards reducing future claims in several ways:
- Transferring data from the third-party processor to an independent claims management system on a periodic basis. Many organizations don’t consider an independent software solution because they feel getting data on a periodic basis in a universal format is adequate. However, many find out too late that this is not an adequate option, because the ‘raw data’ is of little value if it is not tied to a system that can help monitor and analyze the data.
- Many organizations have departments that include claims, safety and medical information that should be included with shared data, as a more complete understanding of this data can minimize claim costs through early intervention.
- Organizations should consider initiating claims by sending data to their third-party with a periodic feed of subsequent data being sent back to the independent system. This option puts the organization in control of managing the data and the process.
- Organizations with high deductibles should use a software solution to manage internal claims and claims not reported. Additionally, periodic transfers of insurance claims can be sent back to the independent system.
A comprehensive workers comp software program provides a tool for early intervention, proactive safety measures and return to work programs as well as additional reporting and metrics. The amount of money saved by organizations will vary, but most organization see a clear return on investment through better monitoring and avoidance of future claims.
Prices and features of workers comp software systems vary by vendor, so it is important to evaluate the available options. Unfortunately, some software vendors will charge what the market will bear, and quickly obsolete versions of their software, making it difficult to understand the true costs.
When evaluating worker comp tracking solutions it is important to look at the track record, client longevity, long-term costs, features and network security. Specific software vendors may discount these costs based on the scope of work and number of software users. An organization will have options of vendors for a comprehensive solution, and the cost of a workers compensation system can vary by $40,000 to $60,000 annually from one system to another when factoring in five-year costs. The large difference is pricing makes it essential to analyze the total cost from multiple providers when considering a workers compensation tracking system.
Price should not be the only factor, as features are important. For example, keeping data secure does add to the cost structure, because additional steps need to be implemented to add additional measures for security and compliance.