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Most employers with integrated disability programs do not measure the effectiveness of their programs, according to a new survey.
Though employers say cost saving is a key reason to integrate the programs, only 38% actually measure the outcomes of their efforts, according to the third annual disability management survey by Watson Wyatt Worldwide and the Washington Business Group on Health.
One reason more employers don't measure outcomes is that "companies believe measuring is more difficult and expensive than it really is," said Michael Scofield, a consultant with Watson Wyatt in Little Falls, N.J.
But employers can start easily by measuring four "readily available" core outcomes: disability cost trends, avoidable claims, work days lost, and employee commitment and satisfaction, Mr. Scofield said.
Another factor that may be keeping employers from even basic measures is that the people in various company departments that have pieces of the data may not be communicating with one another, said Veronica M. Hellwig, a Watson Wyatt consultant in Wellesley Hills, Mass.
The newness of the programs also could be a factor. Additionally, 40% of the employers surveyed said no one in the company is responsible for measuring the results.
Among those that do measure outcomes, lost work days are tracked by 92%, production statistics by 14%, customer satisfaction by 10% and sales/revenue per employee by 6%. Other measures are used by 14%.
This year's survey reflects the responses of 100 employers with 1,000 or more employees that together account for $2.7 billion in direct disability costs. The two previous surveys were based on a larger employer base that included companies with fewer than 1,000 workers. Watson Wyatt said this year's survey focuses on larger companies that can provide specific data on costs, interventions and results.
The percentage of employers with integrated disability programs was 42% in 1998. Of the employers with 1,000 or more workers that responded to the earlier surveys, 30% had integrated disability programs in 1997 and 26% had them in 1996.
Of those that have integrated disability programs and measure their results, about one-third report saving an average of 25% of their total disability costs, while 11% report no cost saving. More than half of respondents said they don't know what they are saving.
Integrated disability is defined as the coordination of workers compensation, sick pay, short-term disability and long-term disability.
Asked to assess several potential reasons for integrating disability programs, all employers ranked improving return to work as "important" or "very important." Improving financial results was ranked "important" or "very important" by 99% of employers, increasing productivity by 98%, minimizing administrative redundancy by 96%, and improving employee health by 95% of the employers surveyed.
"Health, costs, productivity and commitment are all inextricably linked," Mr. Scofield said. "Disability management is one key ingredient" in improving a company's productivity.
Employers use a variety of programs to reduce occupational and non-occupational injuries. Safety/injury prevention programs are used by 90% of employers to reduce occupational injuries and by 30% to reduce non-occupational injuries. Transitional or modified return-to-work programs are used by 80% of employers for workers with occupational injuries and by 71% of employers for workers with non-occupational injuries. Case management is used by 79% of employers for occupational injuries and by 74% for non-occupational injuries.
Among other survey highlights:
* Plan design is viewed by 95% of the employers as a factor affecting employee use of disability programs. Employee job satisfaction is seen as a factor by 92%, supervisor involvement by 87%, and the employee's medical history by 87%.
* Musculoskeletal injuries account for 28% of lost work days. Pregnancy accounts for 23%, repetitive motion for 9% and mental health for 8%.
* Direct disability costs include: workers compensation, amounting to 2% of payroll; sick pay, amounting to 1.9% of payroll; and long-term and short-term disability, each amounting to 1.1% of payroll.
* Indirect disability costs include overtime, amounting to 3% of payroll; replacement employees, 2.7%; and workstation/job accommodation, 1%.
Copies of the complete survey report, "Staying @ Work: Improving Health and Productivity," will be available before the end of the year by calling 800-388-9868.