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Betty Arinder, Attorney – Wells Marble and Hurst, PLLC Hal Caudell, District Manager – CorVel Corporation Bob Fusinatto, Regional Claims Manager – Safety National Casualty Corporation Steve Link, Executive VP of Marketing – Midwest Employers Casualty Corporation September 30, 2010 Timely Report of Injury Investigate and Adjudicate Predict and Intervene – Right Resources at the Right time! Concurrent Reviews Analytics and Trending Impacting Outcomes Agent Reporting ◦ Why is the Center for Medicare Services (CMS) Requiring Reporting Complying with Medicare Mandatory Insurer Reporting Requirements (MMIRR) Identifying Authorized Representative, Account Manager and Account Designee Testing Going Live What are the CMS Requirements for MSA’s ◦ Claims estimated to settle for more than $250,000 when the beneficiary will become eligible for Medicare in less than 30 months ◦ Claims estimated to settle for more the $25,000 when the beneficiary is already eligible for Medicare What about Liability Claims? Current Medicare Guidelines and Affect on Settlement Values ◦ Major Cost Driver’s – Pharmacy Real Life Example of MSA Impact: Lifetime Medical Treatment - $22,528.08 Lifetime Medicare Prescription - $611,994.04 Total $634,522.12 What Type Settlement Should I Pursue What Interventions/Options are Available Top Five Explain workers’ compensation process to injured employee Employer: stay in touch with injured employee; re-assure of employment Adjuster: communication is key; prompt payments Explain choice of physician to injured worker Make sure that employee has clear choice Document choice Temporary Longer out of work, less likely to return Permanent Attorney represents employer, not just carrier Communication with adjuster and attorney Providing information and documents promptly You have more control Less costly than hearing More options for concluding; can be more creative Maintains relationships Reduces Direct Costs (losses) Reduces Indirect Costs (Lost productivity, increased labor costs, etc.) Reduces Excess Premium and Self Insured Retention Improves Employee Morale- Increased Productivity Investigation Medical Management Vendor Management Reserving Recoveries Return to Work – Settlement Supervision, Documentation, Action Plans Excess Reporting We Share the Risk of our Clients TPA “Quality is Critical to our own Mutual (Client/Excess Insurer) Success High Quality Claim Administrative Services Alone cannot Guarantee an Employer will Achieve Best Practice Results Best Practice Results can only be Achieved Through Proactive Employer Management of all Aspects of the Program 16% Average annual increase in WC medical severity from 1995 through 2008 was 13.6% more than twice the medical CPI (8.1% 14% vs. 4.0%). New healthcare reform legislation is unlikely to have any 12% impact on the gap. 10.6% 10.1% 10% 9.2% 8.3% 8.6% 7.4% 7.3% 7.6% 8% 7.2% 6.2% 5.8% 6.0% 6% 5.1% 4% 4.6% 4.7% 4.5% 4.4% 4.2% 4.4% 4.1% 4.0% 4.0% 3.5% 3.7% 3.4% 2% 3.2% 3.5% 2.8% Change in Medical CPI Change Med Cost per Lost Time Claim 0% 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Sources: Med CPI from US Bureau of Labor Statistics, WC med severity from NCCI based on NCCI states. Insurance Information Institute. Medical Distribution of Total Costs 2008 1998 Indemnity 42% Medical 58% 1988 Indemnity 47% Medical 53% Medical Indemnity 46% 54% Source: NCCI (based on states where NCCI provides ratemaking services). Medical Claim Cost Inflation WC Insurers Experience Inflation More Intensely than 2009, CPI Suggests Healthcare Costs Are a Major WC Insurance Cost Driver. They Are Likely to Increase Faster than the CPI for the Next Few Years, at Least Source: Bureau of Labor Statistics; Insurance Information Institute. Obesity Trends* Among U.S. Adults BRFSS, 1990, 1999, 2008 (*BMI 30, or about 30 lbs. overweight for 5’4” person) 1990 1999 2008 No Data <10% 10%–14% 15%–19% 20%–24% 25%–29% ≥30% Source: CDC Behavioral Risk Factor Surveillance System Questions?
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