The Whole Person

The annual meeting of the California Workers' Compensation Insurance Rating Bureau included a presentation by Bill Zachry, VP Risk Management for Safeway/Vons, which merged with Albertsons last year.

It is the second largest private employer in California with, I believe (and Bill correct me if I'm wrong) about 135,000 employees.

Bill was invited to speak to all of these insurance executives because under Bill's guidance Safeway/Vons has reduced its overall claims experience and costs, and has markedly increased its return to work rates (ergo, substantially reduced disability), and has done so using techniques that are not peculiar to the fact that the company is self-insured and self-administered.

This experience is in contrast to the rest of the state, which WCIRB Chief Actuary, Dave Belusci, pointed out is, "by any measure," the most expensive state in the nation because claims don't close quickly, there is greater indemnity and administration costs, and a greater share of the injured worker population get permanent disability benefits.

Zachary's experience, on the other hand, is contrary to the rest of the state. While California as a whole has seen its workers' compensation expense over the past dozen years increase over 120%, Vons/Safeway has seen its expense grow only 12%.

I'll cut to the chase - Bill worked hard to get his claims team to treat the whole person; to spend more now to save much more later; and finally, probably the easiest and most effective technique, to communicate.

I know - these are concepts that are antithetical to normal claims practices. But if a claims shop is really interested in doing the right thing, then frankly there is no excuse to adopt Bill's techniques; doing so would a) largely eliminate the negative claims image that pervades workers' compensation management, b) actually work to save employers (remember those guys? they're the ones that are ultimately responsible for our paychecks...), and c) get the injured back on the job.

Here's Zachry's pointers:

1) Nurses make medical decisions, not claims adjusters. This seems to be a no-brainer, and why this is not a widely adopted practice is simply a product of the penny-wise, pound foolish behavior of claims shops. What the hell does a claims adjuster know about medicine, physiology, or medical treatment? Right - just as much as you and me; i.e. basically nothing. They don't have the training, schooling or practice. It's not their job to practice medicine, so they shouldn't be doing that.

2) Zachry mandated an 8 hour turn around on medical decisions. Have an excuse? There is no excuse - because a trained medical professional is making a decision on medical treatment.

3) Compromise and Release all claims, regardless of whether the injured worker continues to work for the company. The reasoning is sound, and is contrary to accepted practice: let the injured worker get on with their lives and work. Why create an "artificial attachment" to the claim and claims process? The longer a claim stays open the more it costs, bottom line. If the claim is "stipulated" and stays open, so does the injured worker's attachment to the claim. He or she will never get past the injury and its sequelae. This also reduces exposure to the "Sisterhood of Traveling Body Parts."

4) The company established its own pharmacy benefit network with its own formulary. Zachry counseled that this was a difficult process and took about 5 years to get right, but the effect was dramatic. The company didn't experience the opioid addiction issue that has plagued the rest of America.

5) Utilization Review is electronically hooked up to Bill Review so that the bill reviewers know what treatment was actually approved and when; this alone saved upwards of 20% on medical costs: i.e. COMMUNICATION.

6) Speaking of communication, the Vons/Safeway team is trained to do it often, with empathy. Making sure that the injured worker stays in the know about the who, what, when, etc. of their claim greatly reduces attorney involvement.

7) Speaking of the Sisterhood, Zachry's team found that Adverse Childhood Experiences can have a profound effect on the ability of an injured worker to recover. Some of these ACEs may be obvious and known to the employee, but many are latent, sequestered by bad memories. The Vons/Safeway team scans with an innocuous 20 question survey early in every claim for potential ACEs and if a risk is identified therapy is provided early on. Zachry eschews the traditional fear of opening up psyche claims and his experience supports that view. Instead the experience is a much better claims experience and much improved outcomes for everyone. In other words, Zachry seeks to TREAT THE WHOLE PERSON! Think about it, using the AMA Guides we end up with a "whole person impairment" so why aren't we ensuring that the whole person is as well as can be for the job?

Okay, so the Vons/Safeway experience may be attributable to the one salient fact that its their own money - but what's to keep the insured employer, either directly or through their agent, broker, consultant, from demanding the same from their carrier?

Nothing, other than demand.

Demand it.

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Post script: Zachry had the following comment: "The only item you missed that it was (and is) done by the team.. I get a lot of the credit but not deservedly so... It really was Juanita Hayes, Anita Weir, Gilbert Cabrera, Cathey Jackson, Kelly Webb, and a host of others who made it happen."