Apparatus and method of workers' compensation cost management and quality control

An improved method of reducing the cost of an employer's workers' compensation program and managing program quality control for an employer with a plurality of operating unit comprising the steps of:

• a. assessing the efficiency of the best practices of a multi-unit employer comprising the steps of:
• i. inputting into the memory of a computer responses into a questionnaire for workplace management and workers' compensation program quality control practices comprising a plurality of company procedures and cost drivers that reflect company best practices and procedures for each unit, said best practices recognized in industry as being necessary to reduce workers' compensation costs and identify strengths and weaknesses in workplace management practices;
• ii. analyzing the responses from each unit in the memory of the computer using a computer program stored in the memory of a computer;
• iii. calculating by the computer a national workers' compensation management score for each unit wherein the higher the score the lesser the number of best practices recommended to be implemented and the lower the score the greater the number best practices recommended to be implemented for each unit respectively;
• iv. calculating by the computer an average national workers' compensation management score for a plurality of units collectively, or the company as a whole, wherein the higher the score the lesser the number of best practices recommended to be implemented and the lower the score the greater the number best practices recommended to be implemented;
• v. predicting a trend in workers' compensation cost control efficiency in each unit, a plurality of units, or the company as a whole by tracking said workers' compensation management score over time;
• vi. comparing the calculated score value of one unit to a value or values calculated for one or more different units of the same company to produce a unit percentile ranking, said unit percentile ranked in a best-to-worst and worst-to-best unit hierarchy;
• vii. producing a best practices profile ranking report for each unit in a company;
• viii. producing a best practices gap analysis for each unit in a company;
• ix. producing a report of employer-specific customized best practice recommendations for improvement by module for a multi-unit company comprising a prioritized action plan for each unit useable by the company to implement changes in the workers' compensation management best practices of each unit;
• b. comparing the efficiency of the implementation by a multi-unit employer of said best practice recommendations from said action plan for each unit to national standards by data benchmarking comprising the steps of:
• i. inputting into the memory of a computer data characterizing an employer's workers' compensation management practices for each unit, said data including at least the company name, the policy period, the valuation date, and one or more of the following,
• (a) the number and cost of existing workers' compensation claims;
• (b) number of and incurred amount for lost time claims;
• (c) number of and incurred amount for medical claims;
• (d) incurred amount for expenses;
• (e) corporate data comprising total revenue;
• (f) total payroll;
• (g) total number of man hours worked;
• and
• (h) profit margin and days lost;
• ii. analyzing the data in the memory of the computer using a computer program stored in the memory of a computer to produce reports stored in the memory of a computer providing calculated values as dollar values, percentages or rates for each unit, said reports comprising one or more of the following,
• (a) average cost per workers compensation claim;
• (b) average indemnity cost per lost time claim;
• (c) average medical cost per lost time claim;
• (d) average expense cost per lost time claim;
• (e) average cost per lost time claim;
• (f) average cost per medical only claim;
• (g) percentage lost time claims to total;
• (h) average losses as a percentage of payroll;
• (i) average losses as a percentage of revenue;
• (j) recordable rate;
• (k) lost work day rate;
• and
• (l) average cost per full time equivalent employee;
• (m) a transitional duty cost calculator;
• and
• (n) a gross sales to pay for workers' compensation costs calculator;
• iii. comparing said values to national cost averages and statistics relevant to management and quality control of workers' compensation management practices;
• c. comparing the efficiency of the implementation by the employer of said best practice recommendations from said action plan in returning injured employees to work in each unit comprising the steps of,
• i. inputting return to work employee injury data into the memory of a computer, said data comprising,
• (a) employee information;
• (b) date of injury;
• (c) date returned to work;
• and
• (d) the waiting period;
• ii. analyzing said data in the memory of the computer using a computer program stored in the memory of a computer to produce reports stored in the memory of a computer comprising one or more of the following,
• (a) return to work ratio report;
• (b) a return to work tracker;
• (c) lost days;
• and
• (d) total claims;
• iii. identifying individual return to work best practices for improvement and assigning goals for implementation of said best practices;
• d. providing an online improvement training process for implementing recommended best practices in said action plan;
• e. training users by said improvement process;
• f. implementing said best practice recommendations from said action plan;
• g. comparing the best practices implementation over time by periodically repeating steps (a)-(f) and inputting said scores on said score tracker in the memory of a computer;
• h. revising said action plan in response to score trends, and
• i. inputting data characterizing new workers' compensation claims to the memory of a computer after implementing said employer-specific recommendations.