1. Worker Compensation –
It’s a Partnership
Provider
Employer
Employee
Insurance

2. SAFETY
Regulatory
Compliance
Worker
Compensation
PROACTIVE REACTIVE

3. Worker Compensation –
It’s a Partnership
Upton Sinclair, socialist author of The Jungle, a novel detailing the
horrors experienced by a Lithuanian immigrant working in the
Chicago slaughterhouses and the Triangle Shirtwaist Factory Fire.
WC is a form of insurance with stipulation – compensation for
wages and medical treatment who are injured during the course
of employment in exchange for mandatory relinquishment of
employee’s right to sue the company for the tort of negligence
Worker Compensation is paid for by the employer, either self funded
or by purchasing WC insurance.

4. Worker Compensation –
It’s a Partnership
Before WC, if an employee was injured and off
work – it was “too bad for you”
The employer could be faced with a lawsuit
It was the injured who had the burden of proof of
negligence on the part of the employer – tough job

5. Worker Compensation –
It’s a Partnership
The cost of Worker Compensation
Insurance is determined by two basic
things –
What is your risk and exposure
(determined by the classification of
employees) and by your history of claims

6. Worker Compensation –
It’s a Partnership
What you can control -
The basic formula for WC Insurance cost is:
1.Determine the classification code for your employees
2.Determine the rate for each classification code
3.Calculate the total annual payroll for each class code
4.Divide the total annual payroll for each class by 100
5.Multiply the new number by the class code rate
6.Add the premiums for all codes together, this is your
base rate
7.Multiply by your experience or mod rate

7. Worker Compensation –
It’s a Partnership
Determine the classification code for your employees
5 secretaries at $12.75/hr
25 house builders at $22.90/hr
5 carpenters at $24.70/hr
2 debris removal at $14.50/hr

8. Worker Compensation –
It’s a Partnership
Divide the total annual payroll for each class by 100
5 secretaries = $127,500 / 100 = $1,275
25 builders = $1,096,250 / 100 = $10,962
5 carpenters = $265,525 / 100 = $2,655
2 debris pickup = $58,000 / 100 = $580
Multiply the new number by the class code rate
$1,275 X
Add the premiums for all codes together, this is your
base rate
Multiply by your experience or mod rate

9. Worker Compensation –
It’s a Partnership
Multiply the new number by the class code rate
secretaries $1,275 X (class 8810 rate).850 = $1,083.75
builders = $10,962 X (class 5645 rate) 3.10 =
$33,982.20
carpenters = $2,655 X (class 5651 rate) 1.98 =
$5,256.90
debris pickup = $580 X (class 5650 rate) 2.25 = $1,305
Add the premiums for all codes together, this is your
base rate
$41,627.85

10. Worker Compensation –
It’s a Partnership
Add the premiums for all codes together, this is your
base rate
$41,627.85
Now multiply by your experience or mod rate:
Base rate X mod rate = amount paid for WC insurance
$41,627.85 X 1.00 = $41,627.85
$41,627.85 X 1.20 = $49,953.42 (+ $8,325.57)
$41,627.85 X .80 = $33,302.28 ( - $8,325.57)

11. Worker Compensation –
It’s a Partnership
Now multiply by your experience or mod rate:
Experience modifier or mod rate is a term used in WC
insurance. It is the adjustment of annual premium
based on previous loss experience. Usually 3 years
are used to determine the mod rate for a WC policy.
THIS IS SOMETHING YOU CAN CONTROL/MANAGE!

12. I =(C*(1–A)+G)+(A*F)
E+(C*(1-A)+G)+(A*C)
A = Weight Factor G = Ballast I = Actual Primary Losses H
= Actual Incurred Losses F = Actual Excess Losses (H-I)
E = Expected Primary Losses D = Expected Incurred
Losses C = Expected Excess Losses (D-E)
Worker Compensation –
It’s a Partnership

13. Worker Compensation –
It’s a Partnership
“The modern system of workers' compensation is so
complex and arcane it produces considerable grief to
those who must deal with it on a daily basis. Yet these
often cumbersome regulations are so ultimately vital
to society they appear, in one form or another, in all
industrialized nations. “
Iowa Orthop J. 1999; 19: 106–110.

14. Worker Compensation –
It’s a Partnership
It’s a Partnership and everyone has their role –
Employee – must report the injury, follow doctor’s orders and
keep the employer informed
Employer – must ensure injured employee receives medical
attention as needed, report to insurance company within 7
days and keep insurance company informed
Claims – must gather information, determine if claim is work
related or not, pay employee benefits, settle the claim
Provider – must treat patient and determine restrictions or
limitations, determine if work related, release employee back
to work when appropriate

15. Worker Compensation –
It’s a Partnership
1.Injury/illness must arise out of “employment”
2.Seek medical attention as necessary
3.Employee has up to 2 years to report
injury/illness (30 days)
4.HIPAA does not apply to WC cases
5.Keep a written record of all facts
6.File report with insurance company (must be
filed within 7 days)
7.The insurance company will gather information
from employee and any medical treatment

16. Worker Compensation –
It’s a Partnership
 The insurance
company will gather
information from
employee and any
medical treatment –
So what is your role??

17. Worker Compensation –
It’s a PartnershipThings to Document
• Physical symptoms, such as sharp pain, stiffness, loss
of motion, etc
• How long the symptoms lasted; if and when they
recurred.
• Names of any witnesses
• The doctors seen and the date of each visit.
• Money spent on doctors, exams, treatment, medicines
and mileage.
• Days lost from work because of the injury/illness.
• Any statement made to the employer or the insurance
company.
• Copies of any agreement or final receipt signed for a WC
claim.

18. Worker Compensation –
It’s a Partnership
The employee gains by RTW when a doctor allows
1.This is your time to be talking to the doctor, you have
every right as HIPAA does not apply.
2.If you aren’t talking to the doctor, the injured
employee is.
3.Why pay a top wage earner to do lesser jobs that a
restricted worker could be doing?
4.Workers will return sooner rather than go from totally
off work to full duties.
5.Gets you involved and gives you some control of the
recovery.
6. Many workers want to come back to work.

19. Worker Compensation –
It’s a Partnership
Return To Work
Convey to the doctor your concern to stay within the
physical capabilities and ensure employee’s recovery
Make these temporary work assignments giving you
control to end them. Suggested 12 weeks max of light
duty.
You can give the employee any job to do as long as it
does not go beyond those physical capabilities. (Think
outside the box)

20. Worker Compensation –
It’s a Partnership
EARLY RETURN TO WORK ... IT WORKS FOR
YOU!!
The employee may be reluctant to start working again
for fear of pain, re-injury or not being able to perform as
well. If a different job is required because of the injury,
there may also be a concern about trying something
new. (and will convey this reluctance to the doctor)
We may not be willing to bring workers back to work, for
many of the same reasons. It is helpful if employers
have some type of limited duty, or alternate work, to
help workers gradually get used to being back in the
workforce

21. Worker Compensation –
It’s a Partnership
If the employee is not satisfied with the first
doctor, one more choice is allowed; however,
the worker must notify the employer of this
second choice. Only 2 choices
are allowed to employee.

22. Worker Compensation –
It’s a Partnership
On written request, an employee should submit
promptly to a reasonable examination by any
doctor (physician, chiropractor, psychologist,
dentist, physician assistant, advanced practice
nurse prescriber or podiatrist) named by the
employer or insurance company.
IME (Independent Medical Exam)

23. Worker Compensation –
It’s a Partnership
•If a WC claim goes to court, it can be two or
three years later – go back and look at your notes
from a couple of years ago. Are the notes clear
enough you can understand the details of the
incident? Were witnesses statements taken?
Photos? Doctor notes? Supervisor's notes?
It’s a little late now!

24. Worker Compensation –
It’s a Partnership
When an employee has stopped receiving
weekly compensation benefits for temporary or
permanent disability after an accidental injury,
the claim may be reopened at any time within
12 years from the date compensation was last
paid. This 12-year period does not apply,
however, where a compromise agreement has
been made and approved by the department or
where a final award has been issued after a
hearing.

25. Worker Compensation –
It’s a Partnership
Lost Time expenses are calculated at 100%
Restricted Day expenses are calculated at 30%
BIG DIFFERENCE, BIG INCENTIVE FOR RTW

26. Worker Compensation –
It’s a Partnership
What do I do?
1. Make sure your risk classifications are correct for
employees
a. Build a relationship with your insurance
carrier/claims
2. MANAGE claims –
a. Make sure your policy requires immediate
reporting of injuries
b. Make sure your supervisors have training on
accidents and are responsible for RTW
c. Document, document, document

27. Worker Compensation –
It’s a Partnership
What do I do?
a.Form a relationship with the medical providers
b.Develop your company policy
c.Form a relationship with injured employees
d.Return to work program
e.Be informed, follow up, know what is going on

28. Worker Compensation –
It’s a Partnership
THE MORE YOU KNOW –
THE MORE YOU CONTROL

29. Worker Compensation –
It’s a Partnership
Provider
Employer
Employee
Insurance