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| Workers comp costs blamed on a few |
It seems that a small number of doctors might be responsible for the high cost of workers compensation benefits, according to a new study by researchers at John Hopkins University. In a paper published in the Journal of Occupational and Environmental Medicine, the Hopkins researchers found that only 3.7 percent of doctors were responsible for 72 percent of workers compensation costs.
"We have demonstrated that it is possible to objectively identify a group of physicians who are associated with high-cost claims and quantify their effect on a system of health care," said Xuguang Tao, assistant professor of epidemiology at Hopkins. "Our major finding was that the workers' comp costs of claims associated with this group of physicians are much higher than those claims associated with other physicians."
Some of the differences in costs billed by doctors groups were the result of the severity of the injury, but the study controlled for severity of injury by looking at the injury classification, duration of the claim and other factors. The study was conducted by analyzing data provided by Louisiana Workers' Compensation Corporation Researchers examined claims filed between 1998 and 2002.
"Across the board, we've found that most physicians practice prudently," says Edward J. Bernacki, director of the Hopkins' Division of Occupational Medicine and principal investigator of the study. "But there are physicians who engage in cost-intensive practices."
Previous work by Hopkins backs up these conclusions. A 2005 study showed that a small group of doctors could have a large effect on the overall costs in the system. A more recent study showed that certain claim attributes - specifically the involvement of an attorney and the duration of the claims - greatly affected overall claim costs. That 2007 study found that 2 percent of claims accounted for 32 percent of the claim costs. The involvement of a lawyer was also shown to be significant by a 2008 study that found that the involvement of an attorney significantly affected the length of time needed to close a claim.
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When a worker is on the job and when they are not is an important distinction when it comes to workers compensation claims. At first the distinction seems simple, but a recent case in New Jersey shows that sometimes the line between when an employee is at work and when they are not is not simple.
In February 2003 a master plumber left a union hall to get coffee five miles away. He had been sent to the hall by his employer and was waiting for someone to finish a class. While waiting he decided to get some coffee. During his drive to get coffee he was involved in an accident. The man broke both his legs and one of his arms and was declared to be 100 percent disabled. His employer challenged the workers compensation claim saying the plumber was not at work at the time of the accident.
The New Jersey appeals court, however, held that the man was entitled to workers compensation benefits. The court held that the plumber was, in essence, still on the job when he was injured. Incidents "occurring during coffee breaks for off-site employees, which are equivalent to those of on-site workers, are minor deviations from employment which permit full recovery of workers' compensation benefits," the court held.
The case was based on New Jersey law but serves as a reminder to employers that, under certain circumstances, employees who are involved in an accident off-site can still collect workers compensation benefits. It often depends on whether the employee is doing what he is supposed to do for his job or is acting on the instructions of his employer. This distinction also can come into play with companies being liable for their employees' actions. But each state has different laws in these areas and any specific questions should be directed toward a legal professional.
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The recent 7.0 earthquake in Haiti was a tragic reminder that in many places the ground can start shaking at any moment. And since earthquakes strike with no warning, it is important to always be prepared for disaster.
There are many things one can do to prevent the loss of life and property in the event of an earthquake. The Federal Emergency Management Agency provides some suggestions on how to prepare for an earthquake:
- Check for hazards: This means making sure heavy objects are not stored on tall shelves. It also means securing shelves and other furniture to walls and bolting water heaters and other heavy objects to the floor or strapping them to wall studs. And the threat of earthquakes is just one more reason to make sure toxic and potentially flammable chemicals are stored safely.
- Identify safe places: Knowing where you and your employees can go when the earth starts shaking is important. You can ride out the quake under desks and in sturdy doorways. But glass, mirrors and heavy furniture should be avoided.
- Education: Make sure your employees know what to do in case of an earthquake. This might include knowing how to turn off power, water and gas to the building in case of a disaster.
- Supplies: Batteries, flashlights, emergency food and water, radios and a first aid kit are all essential elements to a proper earthquake survival kit.
- Have a plan: Make sure employees know where to gather and what to do after an earthquake. It is also important for employees to know when to return to work. Make sure there is a system in place before the ground begins to shake.
Earthquakes are not just a California phenomenon either. The New Madrid Fault threatens parts of Arkansas, Illinois, Indiana, Kentucky, Missouri, Mississippi and Tennessee. In other parts of the United States, while less prone to earthquakes than the West Coast or the New Madrid area, earthquakes are still possible and businesses owners should at least be aware of the risks. Business owners should also make sure they have the necessary coverage in case of an earthquake. Consult your insurance representative if you have any questions about your coverage.
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| Fraud bureaus take hit as fraud increases |
The economy has taken a toll on state budgets and one of the ways governments are trying to save money is by cutting back on insurance fraud bureaus. These cuts come at a time when insurance fraud is on the rise in all 15 categories tracked by the Coalition Against Insurance Fraud.
"The troubled economic climate confronts many fraud bureaus with the severest challenge they've faced in years," said Dennis Jay, the coalition's executive director.
As the economy went into a tailspin, 70 percent of state fraud bureaus reported a jump in vehicle owners torching their cars for the insurance money. There was also a jump in the number of homes burned down for the same reason, according to the coalition. However, home arson seems to be limited to certain geographic areas, rather than a national problem.
Most disturbing for business owners is an increase in bogus liability claims. More than 60 percent of the fraud bureaus surveyed by the coalition reported an increase in these fake claims. "Reports of increases in slip-and-fall claims from insurers and self-insurers - especially grocers, department stores and restaurants - began surfacing in early 2009 and seem to have continued," the coalition's survey says. The coalition says that often swindlers will pretend to fall to get money from a business. They may pretend to fall on something they spill or on an uneven surface.
All of this increased workload comes at a time when almost 2 in 3 state fraud bureaus are reporting budget cuts.
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| More states crack down on drivers |
The new year brought with it several new state laws restricting the use of cell phones while driving. Illinois, Kansas, New Hampshire and Oregon all have enacted laws restricting using cell phones while driving - though the state laws vary in their severity.
Oregon's new laws go the furthest. The state now bans the use of hand-held phones and all texting. New Hampshire also banned texting. Illinois and Kansas instituted more limited restrictions. Illinois banned use of hand-held phones in certain areas, like school zones. Kansas banned all phone use by those under 18. There are now six states that explicitly ban the use of hand-held phones and 19 states that ban texting by drivers.
"These four states are joining a growing number (of) states and localities that are implementing or strengthening restrictions on cell phone use and texting," said Robert Passmore, senior director of personal lines for Property Casualty Insurers Association of America .
Distracted driving is a serious problem on U.S. roads. The National Highway Traffic and Safety Administration estimates that about 6,000 deaths on U.S. roads were caused by distracted driving in 2008. The Insurance Institute for Highway Safety estimates that users of hand-held phones are four times as likely to be injured in a car accident than those who are not talking on the phone.
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| Still no long-term flood solution |
Once again the National Flood Insurance Program came within days of expiring only to be saved by another short-term extension by Congress. The program is now set to expire on February 28. The federal program, which insures many homes and businesses in flood-prone areas, has been in financial trouble and many critics of the program have called for reform.
"While it's important that the National Flood Insurance Program remain in place for the next two months, Congress needs to stop kicking the can down the road and start working on meaningful reforms," said Jimi Grande, of the National Association of Mutual Insurance Companies. "The problems facing the NFIP aren't going away. The program is financially unsustainable and failing to address that only makes the problem worse for homeowners, insurers and the American taxpayer."
In order to address the financial problems with the program some are advocating that subsidies for non-residential and second homes be eliminated and that flood maps be modernized. Others want more incentives put in place to keep people from building in flood-prone areas in the first place. Still others want to expand the program to include coverage for things like wind damage. Whatever is finally decided, it seems like it will be some time before a final plan is agreed on.
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| Business briefs: NJ mandates car lock |
New Jersey has tightened its drunken driving laws by requiring that most of those convicted of a DUI install a breathalyzer lock on their car. The offender would have to blow into the device, which would not allow the car to start if the offender had been drinking. All repeat offenders would have to install the device on their cars and first time offenders would be required to if their blood-alcohol level was above 0.15 percent. The law was passed in response to the death of a teen who was killed by a drunken driver and the state hopes the new law will decrease accidents. Mothers Against Drunk Driving praised the law saying that these devices have been shown to decrease repeat drunken driving offenses.
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| Business briefs: Embarrassing suit |
A New York woman is suing her gym for a somewhat embarrassing fall, according to a report by The Associated Press. The woman is suing New York-based Crunch after she says she fell during a poll-dancing workout. According to the AP report, the woman claims that she was not adequately supervised during her first class. These risque workouts have been increasing in popularity and are offered by many gyms.
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