A recent study by CLARA Analytics reveals a central theme: Uncertainty creates a fertile atmosphere for litigation. Litigation is not spontaneous. It results from a chain of events, fears and confusion; anxieties and attitudes; worry about lost wages; and both real and anticipated questions about future employment.

There are two sides to workers’ compensation litigation—attorneys and employers/insurers. Workers’ compensation attorneys insist that their services often lead to benefits that cannot be received independently. Attorneys also suggest that legal involvement is precisely what helps workers understand the complexities of workers’ compensation, saving claimants from employer or insurer retaliation in the process. 

Conversely, advocates for employers and insurers contend that attorneys are involved more often than necessary and that workers often receive the benefits they are entitled to without representation. 

More importantly, many believe that attorneys may even reduce the total amount of benefits that workers take home.

Workers’ comp claims by the numbers

Research from CLARA Analytics  lends insight on just how much litigation has derailed the Workers’ Comp system. The firm examined 11 years of data from a single, national payor. Research examined injury years from 2007-2017 and focused on closed indemnity cases across several states. 

The study found that litigated workers’ comp claims were 388 percent more expensive than non-litigated claims. In addition, median values rose 739 percent when attorneys became involved in a claim. Claims also took considerably longer to close, taking 195 percent longer with attorney involvement. 

This study revealed shocking data specific to California;

• One in three claims have attorney involvement
• Total claim payment is approximately seven times greater when an attorney is involved
• Number of days claims remain open is 1140 (3.53 times greater) when an attorney is involved

We all know claims impact the cost of your workers’ comp premium. Doing the math doesn’t paint a pretty picture, especially when you experience attorney involvement in a workers’ comp claim. Reducing workers’ compensation costs can be challenging, but one way to reduce them is to focus on preventing attorney-involved claims. 

Three ways to stop workers’ comp litigation (before it even begins)

One of the top reasons injured hire an attorney is because they believe—or are actually experiencing—a delay in the processing of their claims. When money is not forthcoming, it’s natural for employees to get nervous and worry that the claim will be denied or considered illegitimate. 

As you know, the goal of the workers’ compensation system is to deliver necessary medical care and income benefits to workers injured on the job without the uncertainty, delay, and expense of litigation. Listed below are a few definitive approaches that we have found successful when curbing the litigation process.

Communication

Providing an injury packet to the employee when they are hurt can go a long way in preventing an employee from seeking out an attorney. The overall goal is to alleviate those feelings of fear, ultimately avoiding litigation.

Some of our clients will even send the injured employee a “Get Well Soon” card. This is the simplest way to show that you, as an employer, genuinely care. It also shows that you are thinking about the employee’s health and recovery. 

For example, our clients generally reach out to the employee within the first 24 to 48 hours to review the workers’ comp process and provide reassurance that the employee’s healing is the number-one priority. 

Regardless of the type of communication method you choose, make sure it is as clear and as timely as possible. The Workers’ Compensation Research Institute states that this can ensure that misunderstandings are prevented (such as a worker mistakenly assuming that their claim has been denied). 

Communication is an effective—and incredibly simple—tool when it comes to employee advocacy.

Training

We recommend and help train our client’s supervisors how to listen and relay information during the claim process to the injured employee. Most importantly, we help them learn to use empathy when listening to their employees. With a little training, you can see a dramatic decrease in the rate of claims going through the legal process. Areas of focus include:

• Helping supervisors create timely communications that focus on trust, job security, and entitlement to medical care and income benefits. Understanding the claim process is a crucial foundation.
• Providing written materials and being accessible to help answer employee questions. This  helps ease feelings of vulnerability and uncertainty.
• Communicating in a clear and timely fashion about the status of the claim. You want to prevent misunderstandings through unambiguous, timely communication so the worker does not mistakenly conclude that the claim has been denied or stalled.
• Eliminating claim process breakdowns that prevent timely payments. This will help prevent an employee’s mistakenly deciding that a delay as a denial.

Offer a modified return to work

A return-to-work program enables an employee who sustains a work-related injury or illness to return to his or her original job duties as soon as possible. Designed to minimize disruptions and expenses, a return-to-work program provides temporary, transitional, or modified work duties to the employee. 

Employees who return to work quickly and feel positive about their experience with the company are less likely to seek legal counsel. A modified job offer can also be advantageous to the employer if an employee declines a job offer and the case is litigated.

Additional benefits of a return-to-work program can include lower turnover rates; the opportunity to retain talented employees; decreased interruption in workflow productivity; and of course, a supportive employer-employee relationship. 

If you need assistance in drafting an injury packet, supervisor training, or writing a modified return to work plan, we invite you to contact us. Let us put our Dedication, Heart, and Wisdom into helping you successfully navigate through workers’ compensation claims. 

Terry Stotka, CEO