By John C. Peters, PhD, Chief Science Officer, Gain Life, Inc.
Claims automation software is all the rage as the workers’ compensation industry looks for ways to increase productivity, save money, and deliver a better experience for injured workers. Automation software platforms aim to save money by cutting medical costs and returning injured workers to work faster, thereby reducing indemnity and other expenses.
These costs are the visible part of claims management and the bread and butter of financial balance sheets. However, they are only the tip of the iceberg when it comes to understanding how automation can boost productivity and save money. There are a myriad other costs that accrue behind the scenes, so called “unallocated costs,” that are essential for running a business. Automation can unlock significant savings in nearly every activity system necessary to run a profitable enterprise.
Claim management efficiency
Adjusters spend considerable time on the phone or via email trying to contact injured workers. Texting can help solve this problem and is a basic feature of many automation platforms. Language barriers can also slow down claim processing, as adjusters must schedule translation services when communicating with a non-native English speaker. Auto translation can eliminate the need for an interpreter, especially for routine email communications.
Getting signatures on key documents to move the claim along, like medical authorization, notarization, expense reporting and reimbursement often takes days or weeks when using regular mail. Automation software can send these documents electronically for e-signature and shoot the completed form to the adjuster in a matter of minutes. Many studies have shown that the faster an injured worker receives medical treatment the faster they recover and return to work.
Answering injured workers’ routine questions about the workers’ compensation process, questions like “when do I get my check” and “what should I expect to happen in this process?” also drain the adjuster’s valuable time. These kinds of questions can be managed by a searchable, “frequently asked questions” feature made available through automation software. Importantly, this capability can operate 24/7/365 and injured workers do not have to wait for an email reply or play phone tag, irritants that increase the risk of litigation.
Routine check-ins with the injured worker to ask how they are doing and whether they need any help can be automated. Most adjusters only have time to talk to their injured workers a few times a month and things can happen on a claim between these conversations. Having a real time mechanism for learning about potential issues can serve as a “canary in the coal mine,” alerting claims professionals to problems that require immediate attention.
Finally, automation software can keep a comprehensive audit trail, tracking every contact with an injured worker and the outcome. This provides real time transparency of the progress and status of each claim. Because this process captures activities by both injured workers and adjusters it can avoid issues that could put the claim and company at risk of litigation.
The gift of time
Automation platforms can make claim management more efficient and open more time for adjusters and other claims professionals who are starved for time. What would a claims professional do with an extra hour a day, a week, a month?
They could process more claims in a day, one key measure of productivity. They could spend more time on the phone with an injured worker, building a deeper, more trusting relationship that could help reduce the risk of litigation. They could engage in professional development, learning and sharpening their skills to make them more effective and prepare them for advancement. Training in empathy, motivational interviewing and other soft skills can accelerate the adoption of a “patient advocacy” model.
Having more time would also reduce adjusters’ stress and increase job satisfaction. This could lead to higher employee retention. Some reasons people leave jobs are the lack of deeper skills training and advancement opportunities.
Clerical effort and supplies
Somewhere in the company, people are making copies of important documents, stuffing envelopes and mailing packets to injured workers. Likewise, there are dedicated staff receiving documents, scanning and uploading them into the correct claim file for the adjuster to process. Someone also must electronically archive them and destroy any confidential documents that are past their retention limits.
Many of these paper-based activities could be entirely eliminated though automation, saving on the costs of paper, ink cartridges, envelopes and postage, in addition to the personnel time required to do the work. The cost of postage alone to mail initial paperwork to injured workers is upwards of five dollars a claim in some cases. For companies with thousands of claims this adds up quickly.
How do you measure these savings?
Every company already accounts for “overhead,” which captures many of these costs, either individually or collectively. However, these summary metrics may not account for the investments in terms of time, the minutes and hours spent by personnel at various pay levels carrying out the many activities contributing to this overhead. Time is a critical currency within a business and quantifying the savings of time gained through automation is an important metric.
Injured worker experience and brand equity
There are additional benefits to adopting automation systems for claims processing beyond direct efficiency measures and cost savings. Paramount among them is the value of delivering a great experience to injured workers. People are used to using computer and smart phone apps to do virtually anything, from ordering merchandise to accessing banking services. They have developed expectations for what a service industry should provide, including the ability to self-service. Even health care has embraced apps that help people keep track of appointments, medications, payments and more, through a consumer-friendly interface.
Workers’ compensation needs to catch up to these consumer expectations. Every employer wants their injured workers to feel cared for and to have a positive experience when using the workers’ compensation system in which they have invested.
Capturing the full value of claims automation solutions
It makes sense to question the value of any new product and claims automation solutions are no different. The assessment of value should cover multiple dimensions, from the cost benefit for allocated costs, like medical, indemnity, legal, and other expenses to the multiple unallocated costs stemming from savings of time and materials that accrue in the various activity systems that comprise the total business.
About John Peters
John C. Peters, PhD, is the Co-founder and Chief Science Officer of Gain Life and Retired Professor of Medicine at the University of Colorado, School of Medicine. Previously, John spent 26 years at the Procter & Gamble Company in various R&D leadership roles. He has served on two National Academies of Science, Institute of Medicine committees, and has authored over 160 scientific papers and book chapters and published two books.
About Gain Life
Gain Life (www.gainlife.com) is an InsureTech company born out of Harvard University’s Innovation Lab, and backed by MassMutual, General Catalyst, Unusual Ventures, and insurance industry luminaries. We build software to help people and organizations return to health, work, and productivity. Our claims communication automation platform is utilized by carriers, employers, and TPAs to save claim costs and provide a better claimant experience across multiple insurance lines-e.g., workers’ compensation, general liability, commercial auto, and disability.