What Exactly is Accelerated Closure?

Posted by Michael Bruno on Jul 14, 2016 2:16:00 PM

Dealing with legacy workers’ compensation and liability legacy claims has been a growing challenge for many organizations who carry open reserve dollars on older or “churning” claims.  Old-program claims get limited attention and no urgency from the old program adjusting staff. The claims service industry is necessarily more focused on existing clients and newer claims. This reality costs employers large amounts of money.

Making things more difficult can be changing TPA firms, mergers and acquisitions, layoffs or closing operations.  This can increase the likelihood of lesser-managed claims and require even more urgency for the closure of related legacy claims.

The good news is that accelerated closure expertise can help by outsourcing the oversight of these claims to a specialized 3rd party firm for critical review, disruption, tactical plans and resolution.

A focus on all cases, not just “low hanging fruit”

Many firms that provide these legacy claims services assume the activity of “accelerated closure” involves simply increasing communications and pressure on adjusters’ existing workload.   While this approach can be effective with cases that simply need more follow-up to close them out, it is not effective for more complex situations.

This approach is based on more about how these firms are compensated.  The concept is positioned as a “no money up front” deal that pays out a percentage of closure savings.  This “gain-share” approach only benefits the firm itself and they will have no interest to provide a consistent effort at mitigating every case.

For example, if a reserve must increase in the midst of a gain-share project, that case will be avoided and only become worse.

So what do we mean by Accelerated Closure?

We believe in a consultative and systematic approach for the accelerated closure of legacy claims, resulting in providing an immediate savings in reduced open reserves.

To accomplish this, there needs to be a plan for oversight and aggressive mitigation, if not closure, of every claim – not just the easy ones.   This requires spending a significant amount of initial time understanding alternate strategies and changes plans that were not working in the first place.

Our goal is to reset the claim strategy in the context of forcing closure opportunity for all claims.  This approach will result in immediate hard dollar savings by reducing open reserves.  Historically, this approach has provided a 49.6% closure rate of project claims yielding an average savings of 19.5% in overall incurred costs.

Another benefit of this approach is that you will never have to worry that certain claims will be worse off at project’s end because the project team aborted all intervention when no reserve savings was possible.  We also understand the fact that cases change all the time, and managing a case that “goes bad” during the life of a project is critical to mitigation of the ultimate result.

In conclusion, we believe our approach provides organizations with a cost-mitigating force much sooner than traditional services.  Organizations can also have the confidence that ALL project cases are being managed and mitigated – not just the easy ones.

If you are interested in learning more about our approach to the accelerated closure of workers’ compensation and liability claims, click on the link below to download an overview of our ClaimStop solution.

Veritas ClaimStop!

Topics: Workers Compensation

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