Beware of your TPA’s “Escalation Delay”
Almost every claims operation tracks “lag-time” - days to report and days to open a claim. You may not be aware of a hidden added lag we can call “Escalation Delay.” Many TPAs will hold a claim as Incident Only for additional days until some aspect presents itself to cause an escalation and reassignment to a level of Med Only Adjuster or Senior Examiner. The usual statistics will appear to show the claim “opened” on a certain date, albeit without effort applied. This is particularly true in workers’ compensation where “fast-tracking” of claims purposely intends to apply the simplest level of handling based on immediate information.
Missing Information Can Create Lag-Time
“Fast tracking” is supposed to be based on intelligent assessment of immediate information. The problem is that many TPAs default to Incident Only status when information is lacking. The most common examples, in order of importance, of missing information that will cause a new workers’ comp case to default as Incident Only are:
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Did the employee see an outside medical provider?
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Is the employee losing time?
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What is the employee phone number?
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Who is the employer contact?
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Description of injury with an accurate depiction of severity or complexity
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Any employer insight as to why compensability might be questioned
Any of these items missing from your first report intake may cause an optimistic claim supervisor to hold off on a formal assignment in hopes the issue is minor.
Delaying a case that truly needs immediate investigation and employee contact can cause a devastating loss of control. Often these claims remain as Incident Only until:
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An actual referral to diagnostics or a specialist appears needing Utilization Review;
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An attorney letter is received;
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A frantic employer calls to ask why this person who is losing time has not received a temporary total check yet, or has medical bills needing payment.
Are Your Claims Being Delayed?
In order to check for this problem in your book of claims, ask your TPA for a report on “claim escalation.” This should show you how each claim was assigned on initial report and if the claim needed escalation, as well as how many days it took to get to a Med Only or Indemnity Adjuster. You can then examine claims that incurred this delay and check for your own failing to provide critical immediate data. You can also study the outcome of delayed escalation claims to see if they cost more than those properly assigned.
To solve this problem, work with your TPA to set expectations about “fast tracking.” Demand that any of your claims reported without critical information be immediately escalated for investigation to confirm items such as the six noted above. Only then can a file be assessed for proper classification and assignment. Finally – fix any internal reporting problems in your organization. Be certain every workers’ comp claim is reported with adequate basic information and insight to allow your claims provider to make intelligent assessments. If circumstances cause you the need to file the report first and gather details later that is ok, as long as you provide those details within one day.
Conclusion
Missing information can cause escalation lag resulting in a delay of a workers’ comp claim being assigned to a Med Only or Indemnity Adjuster.
To avoid escalation lag in the first place, ensure the adjuster investigating the claim is following claims handling best practices by collecting this type of information, and there are no missing pieces.
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