Workers' compensation relies on, and adds complexity to the U.S. health care system, which is already one of the most complicated and inefficient in the industrialized world.(Photo: Shutterstock)
Workers' compensation is a complicated and litigious market. Many of the headlines we see revolve around settlements paid out in court. Some believe litigation is the consequence of injured workers who collaborate with attorneys to take advantage of the system, but data paints a different picture.
Related: No 3rd-party indemnification for workers' comp payments
|4 system failures that lead to litigation
Adjusters are overloaded - Most experts agree a single adjuster should manage no more than 120 cases simultaneously, but according to a 2016 Claims Salary Survey many manage over 150 cases. And not all claims (or adjusters) are created equal. Lost-wage claims take longer to process and require more effort than medical-only claims. However, many claim management organizations do not factor the varying degrees of complexity or time engagement when adjusting caseloads.
Adjusters don't have time to contact injured workers - While communication between the worker, employer and insurer might seem like an essential aspect of claims management, the reality is different. According to a 2015 audit on claims management organization conducted by Washington State, only 15% of adjusters communicated with injured workers and employers within 30 days from receiving a claim.
Injured workers are dissatisfied with service - Not surprisingly, the lack of basic service due to overburdened adjusters results in extremely unhappy customers. Overall, 14% of injured workers report being "very dissatisfied" with workers' compensation services, and 17% report "big problems" getting access to medical services on average across 15 states, according to an Insurance Information Institute analysis.
Worker's compensation is very hard to navigate - Workers' compensation relies on, and adds complexity to the U.S. health care system, which is already one of the most complicated and inefficient in the industrialized world, says the Organization for Economic Co-operation and Development. In turn, most employers rely on their insurance or third-party administrators and are hesitant to communicate directly with employees for fear of litigation.
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