A Word From Our Sponsor On The Purpose Of Claims Management

Workers’ compensation under statutory law was a big improvement over the earlier dynamic. Any serious work-injury claims were sent immediately to court with the employee usually getting the short end of the stick. Under statutory law, an employee knew exactly what compensation he could expect for his particular type of injury from checking the schedule of benefits that was freely available to any employee. This was a win-win situation for both the employee and the employer, who now had injury-related costs under control, and could avoid time spent in court with the associated court costs and fees. He could also purchase workers’ compensation insurance to protect the risk associated with those costs.

Unfortunately, some employers could not make the system work as designed. Although it became illegal, employers would track the number of claims each employee had made, and discriminate against that employee. An employee with a serious claim could be terminated or not hired. This type of discrimination was very difficult to prove. To compensate for this reality, some states instituted a workers’ compensation trust fund, to ensure payment of benefits regardless of the discrimination that may be going on in the background.

Most recently, some states have allowed privatization and established a third party workers’ compensation claims management program through metallization. This moved the workers’ comp program to behave more like it was designed, and made sure that employers had sufficient insurance to match their liability in this regard. This form of workers’ compensation claims management has enjoyed some success.