The Injured Worker as a Piggy Bank

We have written before about the misaligned incentives often found in workers’ compensation. I have referred to it as “treating injured workers for fun and profit,” reflecting situations where actions and processes are applied that may not be in the best interest of the worker, but financially benefit the people who are supposed to be helping them. There is a great deal of responsibility upon those of us in the industry not to abuse that fact, as workers are often further hurt in that process. 

That process is commonly known as “the churn.”

A session at last week’s CCWC Conference in Anaheim, CA, touched on this point. The session was “Mitigation Strategies: A Holistic View of Claims.” The panelists were Chad Coleman, Jamie Goff, and Danny Thorn. It was moderated by Brian Arnold. Danny Thorn, who is with Benchmark Claims Administrators, discussed these misaligned incentives that can exist in the system and made the reference that the injured worker was, in those cases, a “piggy bank” for unethical players in the industry. He described the worker as the traditional ceramic object with a slot in his back, where coins could just keep being added. Those coins, of course, come in the form of unnecessary medical procedures, or legal actions that increase disability that happen to financially benefit legal counsel (my examples, not Thorns). It was a very effective visual illustration.

And that is without pointing out that the way you get your money out of a traditional piggy bank is by smashing it when it is time to “cash out.”

This point was especially poignant in California, where the costs of benefits delivery is still exceedingly high. Estimates are that employers pay $1 for every $2 in medical and indemnity benefits provided. That is not a very efficient system, and it indicates they have more than a few piggy bank employees in the state. 

How do we address the entire issue of misaligned incentives? Of simple greed? We know that given the opportunity that most people will do the right thing, but how do we control those who put personal greed over their ethical responsibilities? This is an issue that goes beyond the ability of legislation and regulation. Time and time again we have witnessed legislated solutions to specific abuses, only to watch creative miscreants generate almost immediate workarounds. It is like squeezing the air in a balloon; you can push in on one part to remove the air, but it simply bulges out elsewhere. No, this is a bigger issue that will take the commitment of all honest players to address.

It stands to reason that ethics should be part of any training program comp professionals participate in. It is also up to the rest of us to start calling out abuses when we see them. The bad players in the industry are often known to many, yet they are allowed to continue their abusive acts unchallenged and unabated. There have been several high-profile fraud cases in California in recent years that prove that point. Many within our industry knew there was a problem, but it took the Feds to intervene to address the fraud. Silence can be acceptance when we know something is wrong but fail to stand up to it, and the reputation these actions create stains an entire industry.

And if we refuse to do anything, perhaps it is a reputation we deserve.

Viewing the injured worker as nothing more than a piggy bank violates the very principles of our industry, and often further injures the worker. Most within the industry do not do that, but our silence can be deafening. To quote a phrase that has become all the rage, “If we see something, we should say something.” 

As a vocal community, we can prevent abuses. As a silent community, we are part of the problem. You can (piggy) bank on that.

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