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5 key benefits of reporting workers' compensation claims early

August 2, 2016

Prompt reporting is key to driving better outcomes for employees and businesses.

Vice President, Customer Relationship Management

Steve’s responsibilities include direct management of The Zurich Services Corporation, Zurich's... About this expert

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When your company experiences a workers’ compensation claim, it affects more than just the injured employee. From an employer’s perspective, there is lost production and continuity, increased costs and resource strains. Many people are unfamiliar with the statutory reporting requirements and the financial impact that delayed reporting can have on their company’s bottom line. Delayed injury reporting can be even more costly and result in missed opportunities to mitigate medical spending. It can also lead to increased employee anxiety, confusion and ultimately unnecessary litigation. Reporting as soon as possible is important for both you and the employee.

5 key benefits of early reporting

  1. Keep claim costs down - Delayed reporting can significantly increase workers’ compensation claim costs, according the National Council on Compensation Insurance. The lowest median cost is for claims reported in the first two weeks.
  2. Reduce the need for attorney involvement – Claims that are reported more than a month after the incident are more than twice as likely to have an attorney involved. Additionally, a small percentage of medical-only cases ultimately turn into indemnity cases due to unforeseen complications resulting from underlying health risks of injured employees or unusual circumstances (e.g. infections and diabetic employees).
  3. Close more claims quicklyMore than half of claims that are reported within the first two weeks close within 18 months. However, only 29% of claims that are reported more than a month after the accident close within the same timeframe.
  4. Expedite healing and an earlier return to work – Employees who are satisfied with their employer’s response to injury or illness return to work 50% faster with 54% lower cost. Additionally, medical treatment within specialized occupational medical clinics familiar with treating workers’ compensation injuries may result in quicker healing and an earlier return to work.
  5. Recognize fraud – There are various degrees of fraud and early detection of “red flag indicators” may help determine whether a case should be referred for surveillance or if there is an opportunity to pursue subrogation against a negligent third party.

Early reporting is important, but how do you create a culture that advocates timely reporting? 

Pre-incident Best Practices

  • Conduct annual training for employees and supervisors
  • Be familiar with state rules for “first aid” claims vs. claims subject to reporting
  • Establish and monitor reporting goals at the location level
  • Commit to modified return-to-work programs
  • Set expectations for supervisors to support return-to-work programs

Post-incident Best Practices

  • Complete an internal incident investigation and post-incident drug test immediately
  • Report the claim within 0-3 days
  • Take advantage of your carrier’s medical management program; provide employees with medical provider information
  • Help employees understand the process and minimize uncertainty
  • Keep the conversation constructive – focus on what happened and future prevention, not blame

The information in this publication was compiled from sources believed to be reliable for informational purposes only. All information herein should serve as a guideline, which you can use to create your own policies and procedures. Any and all information contained herein is not intended to constitute advice (particularly not legal advice). Accordingly, persons requiring advice should consult with independent advisers when developing programs and policies. We do not guarantee the accuracy of this information or any results and further assume no liability in connection with the publication and sample policies and procedures, including any information, methods or safety suggestions contained herein. We undertake no obligation to publicly update or revise any of this information, whether to reflect new information, future developments, events or circumstances or otherwise. The subject matter of this publication is not tied to any specific insurance product nor will adopting these policies and procedures ensure coverage under any insurance policy. Risk engineering services are provided by The Zurich Services Corporation.

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