Why’s of Workers Compensation
Workers compensation has become a big business between insurance companies and attorneys. Mostly because the majority of the states require businesses to carry some type of workers compensation insurance to help cover those employees who may get injured on the job. As with any other federal mandate put in place; this was one to help protect the worker and the provider of the family in the unfortunate event they could not work from an injury while on the job. This supplemental insurance is to help the injured worker keep up with bills and keep some sort of standard living in which they were used to having.
With this becomes a vast amount of disputed between injured workers, attorneys, and insurance companies. Any of the parties may feel they were not treated fairly or taken advantage of through fraudulent charges, and misinterpretations of the law.
The common causes of injured workers disputing the level of benefits or compensation is mostly over keeping up financially when it comes to the worker. Most of the time we think disputes are mostly between the employee and the company or insurance company but in reality the biggest disputes are between insurance companies and states attorneys as we have seen in previous lessons.
Liberty Mutual had a dispute lawsuit in which they had to pay over $450 million across 50 states for unreported premiums on workers compensation insurance (A.M. Best Newswire 2012).
Other common disputes we hear about the most are the ones between the employee, company, and insurance company. The company and insurance company is trying to reduce cost and prevent fraud and the employee is trying to make sure all medical expenses are covered as well as compensation for the time lost to cover living expenses. One of the biggest examples are back injuries which many people will suffer with back pain sometime in their life. On average most employees will have ten different jobs within their lifetime and each employer will not want to be responsible for previous injuries which may have accrued previously.
Employee A starts with a company and has a back injury after being employed there for about three years. A workers compensation claim gets opened up and the process will start as the employee gets taken care of by physicians. The company representative will work with the insurance company and if there is reasonable suspicion about the amount of damage being claimed. This will be the start of the dispute process; the insurance company will often place a private investigator to see if the employee is trying to commit fraud. Then the employee will then have to get and attorney involved to protect their rights.
Many times this may seem unethical by employers and insurance companies but over the years the amount of insurance fraud has cost companies millions of dollars. With past experiences the companies and insurance companies have to do things to protect their cost and with this the workers have to get attorneys to protect their interest. This has developed into a business of workers compensation attorneys and unfortunately the only people who lose in this situation is the employee who is legitimately injured and have issues the rest of their life.
Workers’ Rights and Responsibilities:
OSHA covers workers’ rights in the regulations under the following act:
“You have the right to a safe workplace. The Occupational Safety and Health Act of 1970 (OSH Act) was passed to prevent workers from being killed or otherwise harmed at work. The law requires employers to provide their employees with working conditions that are free of known dangers.” (www.osha.gov)
OSHA created this act to protect the worker and allow them to speak out and/or file a claim without any repercussions from the employer. With this protection the employees are allowed to file claims, the right to know workplace hazards, the right to work place medical records, the right to see injury logs. They are also allowed to have access to any testing or past monitoring and also have access to information on chemical products used in the workplace (Workers’ Rights pg. 3).
All of these rights and the rights to file a claim falls under the whistleblower act which is covered and backed by federal statutes. With these rights the employee will also need to adhere to any workplace policies in regards to personal protective equipment (PPE). Although if the company provides such PPE and the employee is found not in compliance it will not cause his claim to be denied but could cause the process to be slowed when disputed by the company. The company still has the responsibility to make sure the employee is in compliant and still liable for any injury incurred while working on the job.
Root Cause of Disputes viewpoint or lack of communication:
Many disputes can have a couple different root causes or a multiple of scenarios leading up to the actual dispute. Communication most likely will be one of the biggest causes of disputes as there are so many different people involved with each case. You will have the injured employee, company representative, insurance case worker, medical personnel; which could be a couple different one depending on the nature of the injury. When this many people are involved there is going to be issues with miscommunication and things will get construed over time.
The employee will have a written statement about the injury and over time with different doctors’ visits things will often change as the employees memory of every detail will fade. Each doctor will have notes on all the visits which these patient statements will be recorded; when the insurance case worker will see discrepancies while going through the notes. The insurance case worker and company representative will start to question the credibility of the employee’s statement and this will kick off investigations and dispute process.
Viewpoints can be another root cause of some cases as companies may have employees with previous injuries or underlying health issues. The company representative will lobby the insurance case worker claiming they should not be responsible for all cost because of the underlying issues the employee had before. This will develop a dispute between the insurance company and the employee on what all should be covered within the injury.
Dispute Process and claims management:
Claims management is normally done by and insurance case worker who normally has some sort of medical education. Companies will have and insurance representative handle the claims for work related injuries. During this process the company representative will work with the claims case worker throughout the process.
Claim process will start when the employee reports the injury and files a claim for work related injury. Larger companies may have an onsite health clinic who will handle the process and if not have established a working relationship with a third party occupational clinic within the area to handle their work related injuries. Claims should be started the same day the injury is reported and consist of a written employee statement, written witness statements, supervisor report, and internal review of all documents (Assurance 2016).
The claims case worker will normally follow the whole way through the injury until the employee returns to work and closes the case. Keeping in contact with the case worker is important with the employee as well as important for the company representative.
Workers compensation dispute process will start from many different scenarios which can be viable to dispute. The process with this can start as early as the day of the injury when the insurance case worker contracts the company representative. The main reasons workers compensation claim can be disputed because of the following:
The dispute process will morally follow a mediation process as most states have adopted informal dispute resolution procedures. When a dispute cannot be resolved with the mediation process then it will go before a formal hearing under a court of law. When either party is not satisfied with the result they may follow an appeals process like any other court hearing process.
U.S. Department of Labor (2019). Division of Federal Employees' Compensation (DFEC). Retrieved from: https://www.dol.gov/owcp/dfec/regs/compliance/wc.htm
Reitz, D. (2008). Workers’ comp subrogation disputes get be tricky with large-deductible plan. National Underwriter Property & Casualty-Risk & Benefits Management, 16.
C.J. Boggs (2009). The Insurance Professionals Practical Guide to Workers’ Comp. Chapter 14 Work Comp for PEOs and Their Client/Employers.
Occupational Safety and Health Administration (2017). Workers’ Rights. Retrieved from: https://www.osha.gov/Publications/osha3021.pdf
Liberty Mutual Files Appeal in AIG Dispute Over $450 Million Workers' Comp Settlement. (2012, June 29). A.M. Best Newswire. Retrieved from https://link-gale-com.libraryresources.columbiasouthern.edu/apps/doc/A294811837/ITOF?u=oran95108&sid=ITOF&xid=80944a8b
Assurance (2016). 7 Steps of Effective Workers’ Comp Claims Management. Retrieved from: https://www.assuranceagency.com/blog-post/7-steps-to-effective-workers-comp-claims-management
Your Legal Guide.com (2020). Workers Compensation Disputes. Retrieved from: http://www.yourlegalguide.com/workers-compensation-disputes/