Demand for dedicated workers comp claims adjusters is growingReprints
Companies with large workforces or specialized return-to-work programs are asking their third-party administrators to provide dedicated claims adjusters who work exclusively on the company's workers compensation accounts.
Exclusive adjusters understand the nuances of working with a particular employer and give companies a direct contact to discuss how their claims are being handled, sources say. The trick is retaining adjusters who work exclusively on accounts so their expertise can be preserved over time.
“The better that they can work hand-in-hand and the more involved the client is, typically the better outcome that you're going to have,” said Peter Keane, senior vice president and claims consultant for Marsh Risk Consulting's claims consulting practice in Morristown, N.J.
Brokers say many or most of their clients seek TPAs that will provide adjusters to work exclusively on their accounts. The request is common among companies with workers comp claim volumes of 110 to 150 open cases at a time in a given location or facility, sources say.
Employers that request dedicated adjusters want to work with people who are familiar with their risk management strategies and understand the intricacies of their accounts, said Paul Braun, managing director of casualty claims for Aon Global Risk Consulting in Los Angeles
“The adjuster knows the context (and) who to call, so it's an efficiency,” Mr. Braun said. “I really do believe it (creates) better outcomes because you know the requirements of the client.”
Adjusters who work on one account often may seem like one of the client's own staff members, Mr. Keane said.
“They're going to be highly familiar with the needs and concerns of that client. They're going to be very familiar with their return-to-work programs and processes, very familiar with their claim-handling philosophy (and) familiar with the people in their locations,” Mr. Keane said. “They establish relationships with them (and) become a trusted adviser for those people.”
Michael Bell, executive vice president of U.S. sales for Itasca, Ill.-based TPA Gallagher Bassett Services Inc., said clients often ask the firm for exclusive adjusters to ensure they have a manageable caseload and can devote undivided attention to their account.
Companies with a large caseload may not see much of a difference in price if they consolidate their cases with a group of exclusive adjusters, Mr. Bell said. Companies that have caseloads of 125 open claims or fewer might pay 10% to 20% more for using exclusive adjusters rather than using adjusters who work with multiple accounts, he said.
That additional cost can be recouped by exclusive adjusters' ability to focus on that client's workers comp claims and improve claim outcomes, Mr. Bell said.
“If you're able to achieve a 5% better outcome on (claim costs), it far outweighs the additional fee that they would have paid on the front end,” he said.
Mary Proietti, risk manager of Lake Forest, Ill.-based manufacturer Packaging Corp. of America, said the company is looking to set up an exclusive adjuster arrangement with Gallagher Bassett, the company's TPA.
PCA, which is self-insured, has about 10,000 employees at more than 100 locations nationwide. The company currently works with about 14 adjusters at Gallagher Bassett who also work on other accounts. Ms. Proietti said PCA could benefit from having a couple of adjusters who work solely on the company's behalf.
“We'd be much more efficient,” Ms. Proietti said. “We'd have more control over our service, and the reserving and the file reviews, and all of that wouldn't be so cumbersome. So just in general, there would be a much better outcome, and I believe the costs would reflect that.”
About 70% of Sedgwick Claims Management Services Inc.'s clients use exclusive adjusters for workers comp and liability claims, said Kathryn Tazic, the company's senior vice president of client services in Chicago. The TPA says the exclusive arrangement can help bolster clients' risk management programs by giving them increased access to their adjusters.
“We really believe that the more involved that a customer can be in their claim program, the better that the program's ultimate outcomes will be,” Ms. Tazic said.
While experts agree there are benefits to working with dedicated claims adjusters, they say companies run the risk of losing adjusters' expertise if they ever leave their TPA employer.
“The only downside is if they leave or are promoted,” said Mike Kenitz, Midwest regional practice leader for strategic outcomes practices at Willis North America Inc. in Pittsburgh. “And then you're looking at totally replacing the position.”
Experts say companies can help minimize turnover risk by working with more than one dedicated adjuster. They also recommend that employers help adjuster retention by letting them know they are valued team members.