The Recovery is Underway – Time to Revisit Risk Management
January 24, 2011
Times have been tough in the staffing industry for the last couple of years and most of us hunkered down to make it through the storm. With reduced revenue, staff reductions were inevitable and some internal initiatives may have been put on hold.
In this environment one of the first things many cut was Risk Management – an area not considered a direct revenue generator. At the same time, in an effort to shore up sinking sales, some pursued business that they would not have considered during better times – thereby increasing their risk profile.
As the economy rebounds, it is time to reevaluate Risk Management, refill vacant positions and restart loss control programs as soon as possible.
A comprehensive risk management program can reduce injury claim costs by 20-40%. In staffing, that can be the difference between a positive and a negative bottom line, especially as margins have eroded in many industry sectors. And claims costs are only the direct costs of injuries. The indirect costs of a claim, like service disruptions, the loss of management time, and recruiting and training a replacement worker can be up to three times the direct cost of an employee injury.
For the most immediate impact, start by focusing your risk management efforts on
· client risk screening,
· injury management, and
· post injury return to work processes.
Client Risk Screening allows controlled risk avoidance and/or mitigation. The idea is to perform a systematic identification of risk in every new account opportunity, then apply appropriate strategies to exclude or manage those risks to reduce the frequency/severity of claims. Generally client risk screening is done at the pre-sale stage, but under current circumstances, a review of all clients acquired since 2007 might be appropriate.
A comprehensive Injury Management Process should be implemented before an injury ever occurs. It should include defined protocols with your medical provider(s), and a plan for active involvement and advocacy by your staff after the injury. The goal is to ensure that any injured employee gets the care he/she deserves and feels fairly treated, and that any treatment provided is needed and legitimate. It focuses on the injured worker who has the unique ability to control the course of their own claim.
You should also have a well defined Return to Work Program that promotes the occupational rehabilitation of the injured employee and speedier claim resolution. Work with your medical provider(s) and claim adjuster to get a work release as soon as possible, and then provide appropriate work within its restrictions (if any). If modified duty is required, find some way to offer work, even if you have to subsidize the expense yourself. The overall cost of the claim will be mitigated once the employee is back in the workforce.
In the end, the success or failure of every risk management program depends on commitment from the top of the organization. Now is the time to re-invigorate your risk management policies and minimize any slippage that may have occurred over the recent past.
(Portions quoted from Assurance Staffing Connection, September, 2010 from the Assurance Agency: www.assuranceagency.com )
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