Related Items
  FREE Insurancenetworking.com Site Registration!
Sign up today and access the leading source of Insurance I.T. information on the Web.

Your FREE site registration entitles you to

FREE Insurance Networking eNewsletters

Search more than 7 years worth of archived data

White Papers and Industry Research that provide valuable insights on a variety of technologies and implementation issues

Access our Web Seminar series

   

Don't Scrimp on System To Run Workers' Comp

John McCormack May 2007

Feeble information technology systems simply won't meet the Herculean challenges faced by workers' compensation insurance carriers. It's a lesson executives learned the hard way at Crawford & Co., an Atlanta-based third-party administrator (TPA) that handles workers' compensation claims.

After identifying the need for software to help with regulatory compliance, Bob Stevens, Crawford assistant vice president of operational compliance, recruited a purchasing team. The team embarked upon the typical purchasing path-searching the Internet for software systems, gathering software information at trade shows and listening to vendor demos.

In the end, the team based their decision on what seemed like the overriding factor: Cost. Soon, however, they found the system fell woefully short. "We used the software for about six months-and realized that it really was not doing much," Stevens says.

First, the system was not user friendly. "It basically just would give users the raw regulations or statutes-and then you would have to sift through it to pull the meat out of it," Stevens says. "I am not an attorney, and my staff members are not attorneys. So, it really was not providing us with any useful information."

Even when the staff managed to find the information they needed, much of it was outdated. That could cause Crawford to base decisions on expired regulations.

Indeed, the system simply couldn't meet the compliance needs of a workers' compensation insurance carrier-needs that sometimes stretch far beyond the ordinary.

"Not all insurance claims are created equally," Stevens says. "Workers compensation insurance claims are the most complex in the industry and therefore require powerful information systems."

That's why carriers need to make sure systems meet compliance, anti-fraud, processing and efficiency goals, industry observers say. Crawford executives had those requirements in mind when they started over in their search for workers' comp software after the first system had failed.

ROUND 2

In the second attempt to find the right software, the purchasing team compared each system's capabilities to the company's workers' compensation compliance challenges. Their evaluations resulted in the purchase of AuthenticWeb for Claims, a database of claims-specific regulatory information developed by Wolters Kluwer Financial Services, Minneapolis.

The database breaks down content by line of business, topic or sub-topic, the vendor says. Expert summaries help users understand regulatory requirements and determine their ramifications. E-mail alerts inform users of regulatory changes by subject matter, jurisdiction and line of business. The system also provides forms for completing transactions.

Although the AuthenticWeb system cost more than the company's original compliance system, the investment has proven worthwhile, according to Stevens.

"We are confident that we are no longer running into the risk of not being in compliance with workers' compensation regulations-which can be financially disastrous," Stevens says.

The system helps the staff pay claims within established time and cost parameters. The company no longer overpays claims simply because the staff didn't have access to current regulations.

Crawford's success in making workers' comp software work is shared by Kaiser Permanente, an Oakland, Calif.-based self-insured, integrated health care organization that administers its own workers' compensation program.

Kaiser Permanente recognizes the necessity of big technology to support workers' compensation efforts, says Jim Zelko, Kaiser Permanente's director of workers' compensation.

"There is a great need for data when trying to manage workers compensation claims," Zelko says. "Data is used for a number of different reasons and it's important to have quick access to reliable information."

Kaiser relies on a database from Computer Sciences Corp. (CSC), an El Segundo, Calif.-based information technology company, to identify and then respond to potential causes of injuries by improving working conditions and thus reducing injury rates.

For more information on related topics, visit the following channels:


Claims

Compliance

Customer Service

Spotlights