September 19, 2023 • 42 mins
Where Did My Adjuster Go? with Jake Acosta.
This week, Ryan Hathcock of Chartwell Law, www.chartwelllaw.com, and Steve Armstrong of Armstrong and Peake PLLC, www.armstrongpeake.com, are joined by Jake Acosta, a director at BDO LLP, www.bdo.com, a leading consultant for insurers, TPAs and self-insured employers to assist in improving their operations. Jake covers the recent trends discussing why workers' compensation adjusters and claims representatives leave for other jobs and what employers, insurers, TPAs and self-insured employers can do to retain their employees. Jake also covers streamlining operations and his research on team efficiency. Ultimately, employee retention and team efficiency lead to better operations and profitability.
You can find Jake on LinkedIn at https://www.linkedin.com/in/jake-acosta-scla-94aab716/.
To learn more about DRI and the Workers' Compensation Committee vist www.DRI.org.
#DRILawyer
#DRICommunity
This week, Ryan Hathcock of Chartwell Law, www.chartwelllaw.com, and Steve Armstrong of Armstrong and Peake PLLC, www.armstrongpeake.com, are joined by Jake Acosta, a director at BDO LLP, www.bdo.com, a leading consultant for insurers, TPAs and self-insured employers to assist in improving their operations. Jake covers the recent trends discussing why workers' compensation adjusters and claims representatives leave for other jobs and what employers, insurers, TPAs and self-insured employers can do to retain their employees. Jake also covers streamlining operations and his research on team efficiency. Ultimately, employee retention and team efficiency lead to better operations and profitability.
You can find Jake on LinkedIn at https://www.linkedin.com/in/jake-acosta-scla-94aab716/.
To learn more about DRI and the Workers' Compensation Committee vist www.DRI.org.
#DRILawyer
#DRICommunity
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
(00:18):
All right, welcome back into oursecond episode of The Conversations podcast, a
podcast developed through the Defense Research Institutewhere we explore the world of workers compensation,
including the personal aspects involved in therealm of work injuries and its litigation,
as well as future trends and everyaspect in between. My name is
(00:38):
Ryan Hathcock. I'm an attorney licensedin the state of Georgia, and with
me is my friend Steve Armstrong,an attorney licensed in the state of Kentucky.
Steve, Since today's episode is allabout adjuster turnover, I feel that
this episode is going to resonate witheveryone involved in the insurance litigation and claims
handling. I know that I sawa large out of adjuster turnover as the
(01:00):
pandemic took its effect, But inyour experience, did you run into the
same kind of thing I did.It seemed like there was a lot of
adjusted turnover, a big problem withit, and it seemed like sometimes we
were as attorneys, we were doinga lot of the work like that,
carrying the case forward. Looking forwardto speaking with Jake accost It today about
(01:23):
this issue. Yeah, right,And that's why I think this conversation is
going to be so great because weget to speak with Jake and who's an
expert in the area of consulting forinsurance companies and claims management. Jake is
a director at BDEO USA LP.He leads the claims advisory practice at b
DEO and has over twenty two yearsof experience existing companies improve the way they
(01:47):
manage their claims. In his practice, he has led numerous engagements focused on
workers compensation claim handling. So,without further Ado, welcome Jake, Thank
you for being on the podcast today. Hey Ryan, as you think,
thank you so much for having meat Jake, Ryan, we just went
through. We talked about your backgroundbriefly, but can you tell us more
about what BDEO does and what yourrole is there? Absolutely see so BDEO
(02:14):
is the fifth largest accounting firm inthe country, but we also offer a
lot of advisory and audit services toinsurance companies across the board. I lead
the claims advisory groups, so Isit in advisory and I my practice has
been I am pretty much here atBDEO for the past two and a half
(02:35):
years. I have a team ofclaims professionals that work with me and we
all have similar backgrounds, primarily inthe field of workers' compensation, where our
insurance companies come engage with us tohelp them become more efficient and how they
manage their claims. And one ofthe key topics that we help companies really
not just diagnose, but solve isturnover for front line specifically frontline workers compensation
(03:04):
turnover. It's been really something thatwe've seen a big uptick in with our
own clients the last two and ahalf years. So my team really focuses
a lot on educating clients on howthey can not just retain their current frontline
playing professionals, how can they canmake them more efficient and engage with them
more as well. Right, soundsgood? And where's video based? Where
(03:25):
are you based? So? I'mbased here in New York. My practice
is here at one hundred Park Avenuein New York. Videos home office is
also based here in New York,Okay. And do you travel or does
your team travel to go see clients? Is that how that works? It
is? Steve? I mean wetravel pretty much. I would say I'm
(03:46):
on the road about once a weekevery month, not as much travel as
we were doing before, because,like you know, like everything else not
with the pandemic, there's a lotof remote work where we just you know,
talk to clients on the phone aswe do travel. Would need to
help our clients out right, andso we have jokingly title this podcast where
did my adjuster go? But itactually is a real question. I say
(04:10):
that in the context I had twoor three litigated files where I'm on the
fourth or fifth adjuster in the spanof twelve months. Some of the adjusters
I worked with told me they wereleaving due to burn out, some had
too many claims, some said theywere promised help but they never got it.
Is that what your analysis has shownas well? Or is it other
other things like that? Now,Steve, So that's that's spot on,
(04:33):
you know. Let me give youa little bit more context to us to
what we're seeing with clients who contactme all the time asking if we can
help them out. So we dointerviews commonly with you know, senior executives,
but we really focus a lot ontalking to frontline claims professionals to really
get down to root causes and gettheir perspective. We also take a look
(04:56):
at some industry benchmarks and I'm goingto share with you it comes to employee
turnover, I think a pretty dauntingindustry statistic. Risking Insurance is also another
company that we use for benchmarking,and they do benchmarking studies every year that
we commonly also validate with clients.And one statistic that they've done over the
(05:16):
last two years is in twenty twentytwo, they interviewed various insurance companies to
talk about frontline workers, compensation,employee turnover and what they found was and
compared to twenty seventeen, a lotof folks have been really truly looking to
expand their opportunities in search employment opportunitieselsewhere. So let me just give you
(05:40):
some statistics. In twenty seventeen,a lot of the companies that were interviewed
said that twelve percent of them werelosing frontline employees at a rate of ten
to twenty percent. So ten totwenty percent in twenty seventeen, that's still
a pretty big statistic if you thinkabout losing frontline employees. But then in
twenty twenty two, just last year, they redid the study and that number
(06:04):
now jumped to thirty percent, Sothirty percent of the insurers that were interviewed
for workers compensations, said that theywere losing ten to twenty percent of their
staff A third a third of theirstaff is walking out the door for workers
compensation. And then if you alsoinclude the fact that eleven percent of them
(06:25):
said that they were losing twenty tothirty percent of their staff. So think
about that, that's forty percent ofcompanies that were interviewed, we're saying that
they're losing their frontline workers compensation professionals. And if you know, as we
all know, if you think aboutthe fact that when someone leaves you have
to sit there, you have toreassign their pending workload to someone else,
(06:46):
which creates challenges across the board.It also increases the risk that something gets
missed, fines, penalties. Soit's a pretty big problem to have.
So the big question is why youknow what's going on? And I know,
Ryan, you mentioned the post pandemic. A lot of companies are really
struggling with this hybrid working model that'swhat we call. I mean typically,
(07:09):
as we all know, a lotof these insurers had their employees come in
every single day to manage claims.They can talk to them, they can
sit there, they can review informationwith them, but now that we're in
this hybrid model, a lot ofcompanies that I know I'm working with personally
are really struggling with keeping their employeesengaged, allowing them to make much more
(07:30):
complex decisions, and really updating theirprocesses to allow them to have much more
value added abilities really to make decisionsfor workers' compensation. So, to answer
your question, Steve, this issomething too that a lot of companies are
really struggling with when it comes toproviding assistance hiring, and to your point,
(07:53):
the people who are really unfortunately sufferingthe most are the claim professionals in
the front lines, and these statisticsshow that they're leaving. They're looking to
get opportunities to go somewhere else wherethey feel more engaged, where their employers
can also allow them to help makemore decisions, less manual tasks, and
it really allows them to open uptheir abilities to also seek further opportunities where
(08:16):
they can partner with different attorneys,different medical providers to continue expanding their abilities
and not have to go back tothe traditional way of doing their work.
Right, Well, it sounds likeyou know there are a number of reasons
why there's been such an uptick inthe number of people that have been leaving
their respective jobs, and certainly thepandemic allowed for those type of changes to
(08:39):
happen to some degree, with peoplebeing at home more often than being in
the office. It sounds like you'vegot a large number of statistics from industry
data you've collected. But in yourconversations with your clients, do your clients
ever tell you that they perform exitinterviews with some of these adjusters and help
gather some information that you can useall the time, Ryan, Yep,
(09:01):
all the time. So what's interestingis that the exit interviews that they gather,
when it comes to feedback from theirclients, they break it up into
two separate buckets. They break itup into is there something that we've could
have done to keep ex employee here? So essentially, is it something that
we've could have prevented? And thensecondly, is was the employee going to
lead for other reasons that they decideto leave because they were going to pursue
(09:24):
other opportunities outside of the current field. And what we find is, ironically
enough, greater than sixty to seventypercent of the time employers have an opportunity
to do something that would have keptthat employee there. So, for instance,
allowing that employee to automating processes,automating procedures, allowing that employee to
(09:48):
make much more critical decisions, tobe an advocate for injured workers in order
to be allowing them to get backis the number one facet. The second
fact that has to do it actuallyworking from home. You know, ironically,
I don't know if you guys haveseen more companies are trying to get
employees to come back into the officemore and more now, and some employees
are just gotten to the point wherethey're looking around to see if they can
(10:09):
continue working from home because as weall know, it's a lot easier for
them, both personally and professional.So that exit interview information and stuff that
we see, we come in andwe help validate this information with these folks,
and then we help put together businessplans for them, a lot of
which also involves better use of litigationand better use of defense counsel. Another
(10:33):
facet that we do see is training. I know we spoke about training before,
but when it comes to training,a lot of times companies focus more
on new employee training for some ofthese workers. Conversation professionals, but technical
skills as what we're seeing, it'sjust it's just not enough anymore, guys.
I mean, companies really need tofocus a lot more on some of
(10:54):
these soft skills that the training werefolks, you know, things like emotional
intelligence, better communication skills, andalso allowing them to make better decisions around
negotiating settlements. A lot of timeswe also see that employees want to be
able and be involved in trying toresolve Borka's conversation claims instead of deferring that
(11:15):
to the Defense Council. So trainingis also the third function that we see
a lot that also leads to alot of folks, you know, looking
for other opportunities, right, AndI want to come back to Jake,
I want to come back to automationand training here in a minute. But
on the working from home aspect,did you do you believe that people adjusters
(11:37):
think they're going to be left behindif they are required to come back in
the office. I know some inthe media various industries talking about, hey,
we require people to come back inand you're you're really going to be
pushed the second tier if you don'tcome back into the office. A certain
number of days a week. SoSteve, that's a that's a that's a
(12:01):
big risk. So yes, toanswer your question, there's some employees who've
gotten so used to working from home. They're very productive, they're still doing
their jobs very well, but themindset for their employers has always been,
well, if I have to comeback into work, I want everybody else
to come back in. So you'reright, they do have that mindset that,
(12:22):
you know, even if they dostay home while they are colleagues,
some of them are coming back in. If they don't, it's that all
modern outage of you know, outof sight, out of mind. So
they're starting to get concerned that theirperformance will be you know, impacted,
or the way that their performance israted and evaluated could suffer from from working
from home. So yes, thatis a big risk. I can tell
(12:45):
you personally speaking, when I speakto managers, and I speak to them
all the time on workers compensation impactsand claims, they tell me that it's
so much easier to be able towalk out and talk to folks, especially
when it comes to nurse, medicalcase managers and other vendors that they use
having them either on site or beingavailable twenty four seven is something that impacts
(13:07):
them. But when you get downto their front line staff, a lot
of the questions that they say is, well, you know, I'm always
on the phone, I'm always talkingto engine workers, I'm talking to my
attorneys. Why do I have tobe in an office twenty four to seven?
So that's type of information and thattype of you know need from a
frontline position. We spend so muchtime on a change management aspect with insurers,
(13:31):
just making sure that they're aware thatyou know, there are very easy
and really, quite frankly, updatingprocesses and procedures and looking at using technology
and automating is so much easier todo in today's world, post COVID,
post a pandemic, that you reallyhave to change your mindset. And if
you don't, statistics are showing employeesare just going to start looking around.
(13:56):
And then there are companies out therewho are really differentiating themselves and you're going
to be facing more turnover unless youstart changing the way you look at the
workforce. Right And I will tellyou from a personal standpoint, I tried
to go up to see a clienta few hours away from here a couple
of years ago at the end ofthe pandemic, and they said, you
(14:16):
can't come, Steve, because we'veclosed our office and everybody's at home now.
And so I think it was someof the clients I had were heading
that way to begin with, butsome were not. So I think this
COVID issue is really forced the changeover there with those particular clients. But
I don't think everybody's gone to theidea of everybody working from home yet.
(14:43):
If we could come back to training, do you have any ideas on how
best to train people who are goingto be working at home? What is
your research show there? Oh?Absolutely, Steve so training. When it
comes to training, there's two facetsthat we commonly work with folks on.
What we typically do is when itcomes to technical training for workers compensation,
(15:05):
we really focus a lot on havingoptions for employees. So there's some employees
who when you know, when youstart at a new company, you want
to be able to talk to colleagues, you want to be able to meet
your boss and meet the leadership team. So what we commonly work with some
clients who do still have real estateand still have office space, we preach
to them that they should be bringingfolks in that our new hires, you
(15:28):
know, that they can sit down, work with them, do technical training,
but then also allow them, ifneed be, to start working from
home and in a in a hybridcondition, you know, maybe three four
times a week. They come in, but slowly as they start matriculating and
start becoming more productive in their owngetting more comfortable, allowing them to go
(15:48):
back and work from home. That'sthat's a number one training aspect is having
that manager come in, work withthem in an office and then slowly migrating
them to work from home. Butthen when it comes to other employees,
the folks that have been working thereand they're more experienced, well, we
commonly preach funny enough is not trainingthem, is actually training their managers and
(16:11):
their supervisors. It really becomes afacet of really trying to help leadership and
help the management team get more comfortablewith the fact that their employees are not
right outside their doors and they're notin an office space. The workers compensation
is very, as you guys know, very complex, a lot of compliance,
(16:32):
a lot of forms to fill out, a lot of things to do,
and I just think as an industry, we've gotten so comfortable with having
people right there around us that whenthey're working from home, people which just
automatically assume that there's a greater levelof risk because of distractions. And what
we're working with clients on commonly ontraining plans allowing their supervisors to look at
(16:53):
things a little bit differently. Youcan monitor performance, you can take a
look at what's outstanding, what forms, what payments, all these reports that
are typically pulled, you can monitorthose whether you're working from home or working
in an office. So I spenda lot of time working with claims managers
and chief claims officers on just educatingthem on all the facets around being able
(17:17):
to be more productive and governance withhaving a remote workforce. So, actually,
Steve and Ryan is not most forthe more experienced people, is not
really training them to work from homeas much as it is training their supervisors
to get more comfortable with obviously theconcept. Yeah, absolutely, and one
I think we can agree that oneof the largest issues with adjuster turnover is
(17:41):
this new ability to work from homeor versus come back in the office.
I think the second thing that we'venoticed in our conversations with some of our
clients is just the amount of workload. Sometimes I'll get on the phone with
an adjuster and they just keep tellingme how swamp they are, how they
haven't seen emails or they just haven'tgotten to it. So find that to
be another reason they look for atransition to a new company is or can
(18:03):
you work from home? And canthey have a workload they can manage?
So you mentioned something about automation,and I assume that companies that are doing
that will allow their adjusters to manageor workload better if half of their work
or some of their work is automated. So can you discuss what you've seen
in terms of workload management? Hasthat gotten better? And also in terms
(18:25):
of automation, what have you seenwith that so far and where is that
going and how can that help adjustersmanage their workload? Yeah, no,
absolutely, Ran. So to yourfirst question around work workloads and their inventories,
we've actually seen an uptake and thenumber of claims assigned to an adjuster.
And let me be specific and giveyou some some statistics. So on
(18:48):
average, what we're seeing when itcomes to workers compensation, is that an
indemnity adjuster or a worker's conversation indemnityadjuster what typically have between one hundred and
twenty five to one hundred and theopen claims typically yes, and that can
vary, but I mean, youknow, on average it's about one twenty
five to one fifty eight. Whatwe're seeing now over the last six to
(19:11):
nine months and working with clients andwith our team, then that number is
almost doubled, between two hundred andfifty to three hundred claims. And the
number one pain point to that isturnover. Yeah, Steve, you know,
We'll come in and do interviews andI'll speak to managers and they're like,
well, yeah, you know,Jake has a high inventory right now
(19:32):
because we just lost someone, soI had to transfer claims over to him
temporarily. And that temporarily can meanwhat four six, eight weeks? I
mean, who knows until they startinterviewing people, so it becomes it becomes
almost a dominant effect. Once thesecompanies start losing these folks and they have
to start reassigning claims, they commonlysay to us, my workload is just
(19:55):
unmanageable, and how long is thisgoing to last? You know, how
long is it going to be thatI'm going to be managing all these claims
and I can't get to things,So it's a it's a significant problem to
have the second part of your questionI had to do with automation. So
companies are investing more and we're seeingit much more when it comes to automating
some tasks when it comes to workerscompensation. You know, I did an
(20:18):
interview two weeks ago with a frontlineclaim supervisor actually, and she told me
that on average, and this isa number that I found daunte on average,
forty percent of their time it's it'sspent on something on an activity that
they consider either administrative or a complianceactivity. And let me give you an
example of that administrative meaning that they'llthey'll literally have to spend time filling out
(20:42):
a form to have someone else sendout a payment, or manually filling out
a form under a computer to toyou know, sen send send a vendor
out for workers compensation, or fillingout a form and sending it to their
manager to get approval for either anexpense or an indentity payment. So if
(21:03):
you think about all this time that'sspent, and I keep asking questions around,
well, how long has it takenyou to get a response? How
long does it take you to getfollow ups. They can take days on
average for them to actually get informationback, or to get things approved from
a payment perspective, or to getanything done. So if you multiply all
these activities out by these higher workloads, I mean, these claimed professionals are
(21:29):
literally sitting there saying I can't getanything done. I'm literally sitting here,
I have a high inventory. Myemployer now telling me I have to go
back to the office to go towork. So that's becoming a bigger strain.
And now I'm doing a lot ofthese administrative tasks that I think could
easily be automated. So it's it'sreally a triffect when it comes to all
these issues that they're having. Sothe solution that we're working with clients is
(21:53):
on consistently have to do with youhave to take a look at your operating
model, you know, are piecingaway some of these tasks and start using
your folks better. You know,when it comes to workers compensation, your
people should be primarily five percent oftheir tasks should be on compliance and administrative.
It's validating things that other people haveset up for them. Payments,
(22:15):
compensibility decisions are things that they needto be focusing on, not filling out
forms for payments for the workers compdivision. So it's really just taking a
look at your model more than itis changing the entire dynamic of handling claims
and then workloads too. So Iactually work with some clients that when they're
(22:36):
having turnover issues, their managers takeon claims in order to and then that
brings up an additional set of challenges. So the question becomes, how do
you really focus your time making surethat the workloads that your employees have is
manageable. How do you know thatyou can take away certain activities that it
can make them more productive, thatthey can start closing out some more of
(22:57):
these claims. And then from atraining perspective, a lot of the advice
that we've your clients is partner withyour attorneys more. You know, these
relationships with Defense Council in the pastused to be very technical. As you
gentlemen know you got you were alwaysretained on the technical side. But man,
there's a wealth of information that DefenseCouncil can do. From a training
(23:18):
trending perspective, Partner more with themto allow you allow them to come in
do training, help out your staffon what they're seeing locally. That can
free up your managers more to domore of the you know, obviously more
complexes, right. And sometimes alongthose same lines, sometimes we see a
fairly small claim that could be settledquickly, but the claims that we're dealing
(23:41):
with has to present it to agroup of people, a team, and
you know that's been We've seen thata long time. But we have to
prepare a report and then they taketheir own report, they take our report,
prepare their report, and then theyhave to meet with some people to
get authoritied settle a claim, andit takes weeks to get that move forward.
(24:04):
In the meantime, Ryan I,other attorneys are having to say,
Judge, we need more time toget to the point where we can even
talk about settling the claim. Haveyou seen anything like that, especially in
the TPA context, and what advicewould you give to decision makers on that?
So, yes, the authority requestis the number one pain point that
(24:30):
we see from a supervisor perspective aswell. And by authority of a questure,
right, there are numerous stakeholders withsome organizations that have to see a
claim based on a certain threshold.You know, they want to settle a
claim for ten twenty thousand dollars,I have to go to one person,
but to higher up you go.When it comes to the amount of money
that's being requested, the more peoplethat are typically involved. So what we
(24:53):
typically look at is, well,how long is it taking and what's the
governance process? And we mainly comein and speak to not just our own
individual clients, but to t pasall the time to say can we streamline
this process to where maybe it's justone individual that has the authority that can
take a look and approve because toyour point, you have attorneys that are
(25:17):
waiting, having to go back toget deferments because it's just taking so long.
I mean, one client that wecurrently work with, we did a
time study on all the activities froma workers conversation perspectives that it takes and
on any claim greater than one hundredthousand dollars one hundred thousand dollars settlement,
it takes on average eight to sixteendays to get approval. And the next
(25:41):
question that I had was, well, how many times does an authority of
requests go up where it gets denied? You know, essentially it's either denied
or setting back for additional information,and the answer was none. Every time
an authority request was processed, itultimately got approved. It just took between
eight to sixteen days for it.I think about that, that's almost a
month where they're waiting to get authorityback. So what we do is we
(26:06):
come in and we commonly tell folks, take a look at your processes.
A lot of these companies and eventhe t PAS guys, they're still following
processes and plans that they've had inplace for decades where you'll have to present
to numerous individuals. You'll also havedefense council potentially have together reports. We're
telling them you need to streamline thisthat essentially you have to cut this down
(26:30):
to at a minimum two to fivebusiness days that these requests get evaluated and
then hopefully either approved or you getfeedback to the adjuster. And it all
starts with updating their internal policies andprocedures or even their own TPA guidelines that
they have in place with their customers. Right, I can tell you with
one of the more agile clients thatgot we'll have this exercise and we'll prepare
(26:52):
our reports fairly quickly they're fairly small. And then if we need to get
on with the decision maker at theemployer and the TPA, we can do
that fairly quickly, as in threeor four days on a video conference just
like this, and the decision willbe made. And so that that is
an example of when it really works. If we could, for just a
(27:15):
minute, I'd like to go backto during COVID in the recruiting process since
COVID. During COVID, we sawpeople coming in to this industry from other
industries to work as adjusters. Isaw nurses, I saw people who had
been in other fields and they'd neverbeen to the insurance industry at all.
And the people I dealt with didn'tlast very long. How do you where
(27:41):
do we recruit from now? Andwhere should employers, self insured employers,
tpa's insurers recruit from straight out ofschools or certain age or I don't know,
you know, you know, it'sfunny when I typically speak to new
(28:02):
adjusters, they come out of strictlyout of college. You know. We
commonly ask them, you know,you know, what made you get into
insurance and primarily what made you getinto claims? And they kept mentioning that
there were so many job openings aroundfor workers compensation primarily that they decided,
you know, it's something too thatthey had a lot of opportunities to come
in, which I think is anindustry is an interesting against an interesting piece
(28:25):
of feedback. So what we commonlydo, ironically enough, a lot of
the companies that we work with,they actually recruit directly from t pas so
TPAs that they work with, they'llrecruit from there if they have an internal
claims function, But they also spenda lot of time recruiting out of local
colleges, local communities. When itcomes to getting folks right out of school,
(28:48):
they really want to make sure thatthey bring folks that are have a
local presence because, as we allknow, workers compensation has so many local
jurisdictions, that has so many localvariance to it. So they spend a
lot of time doing a lot oflocal recruiting. I can tell you too
from an experienced perspective. Having thishybrid model also allows you now to recruit
(29:11):
talent all across the country. Imean, that's one of the benefits is
if you're a company that allows forremote work and hybrid work, you no
longer have to just primarily focus onhaving folks primarily around where an office location
is. You can recruit across thecountry. So we spend a lot of
time working with companies saying to them, you know, even if you are
having an issue with local talent,you know, when it comes to working
(29:33):
remotely, these are some solutions thatyou can provide yourself to open up your
talent across the country and as aneven bigger initiative and an even bigger benefit
for folks to have folks that theycan actually pull and plug and also assign
different work too. If you're havingan issue with workflow, is expanding that
you know, you know, jobbase across the country that you can have
(29:56):
folks all across you know, postingand working. From a workers perspective,
I'm gonna switch courses here because froma litigation side, and this is what
the attorneys listening to them would liketo hear more about, is you know,
we know the insurance game is allabout numbers and trying to be cost
efficient, but in many instances,I feel like claims adjusters are hesitant to
(30:21):
send over cases early on for thepurposes of reducing their litigation costs. But
in many ways if they would justinvolve us earlier on, we might be
able to get a better handle onthe cost, whether it's medical or just
a decision related to compensibility. SoI know that's got to be an issue
in which you see where they wherea company wants to save on litigation costs,
(30:41):
but also find and maybe bringing inlitigation earlier on might be the way
to save money. What are yourthoughts on that, Ryan? I agree
with you. In fact, I'mworking on two engagements right now with two
insurance companies where we're actually completely revampingthere aigation management strategies and the number one
(31:03):
facet is early intervention, Like that'stheir number one initiative. And it's funny
both insurance companies that we're working withwith this early intervention, the main reason
why they're also involving their attorneys more, you know, earlier on in the
process has to do with the factthat they don't have a lot of experience
right now because they're going through turnoverissues from a workers comp you know,
(31:26):
employee perspective, so they want tobe able to bring in and bounce off
and have essentially their attorneys earlier oninvolved in these claims because to your point,
it's not a question of whether ornot they want to lower expenses,
is that they really want to makesure that they can control the severity of
somebody's claims as well by making betterdecisions. And the reality is by involving
(31:48):
litigation attorney's defense counselor earlier on,especially in somebody's claims, to have the
propensity to go down the road tobecome even higher severity losses is crucial Trusia.
So I'm actually working with these two, these two companies on identifying the
best way to involve which cases toinvolve attorneys in sooner. So there's a
(32:09):
lot of predictive modeling that goes in, there's a lot of work that's done
on the back end taking a lookat auditing claims to be able to identify
which claims could have had an impactby having legal involved quicker or sooner,
I should say, but it's alsosomething that I'm seeing across the boards across
my client bases, you know,Jake, where should I bring in legal
(32:30):
sooner and how can I better partnerup with them instead of just waiting until
litigation is commenced, where essentially thatwe're playing catch up instead of being able
to prevent and mitigate some Ofdy's exposure. Yeah, and I guess along the
same lines. Have you seen wherethere's been a conversation with your clients about
if we bring in litigation earlier,maybe that reduces the workload on our adjusters
(32:52):
because they can move on to anotherfile. In some ways, that would
reduce that turnover because they don't feelswamped on by a particular issue that they're
having problem with, but they justdon't feel that their manager would allow them
to send this issue over to litigationyet. So if they're just allowed and
have that freedom to say, ifyou get bogged down on a case,
go ahead and send it over tooutside counsel. Let's get it moving and
(33:13):
then you can switch over to anew file. Has that conversation ever arose
it? Has it has? Ryan? Yeah? So, I mean that's
that's exactly where I think it hasto do with trusting your adjustice to make
the right decision. So when itcomes to making some of these decisions or
some of these claims, we're actuallyseeing that more companies are becoming more flexible
by having their adjusters where fur casesout pick up the phone, contact Defense
(33:37):
counsel get an opinion on compensibility ifit's something that they're not too sure of,
instead of waiting for their manager toget back to them on making a
decision, they're allowing. And whatwe're recommending the companies is you should really
allow the autonomy for your adjusters tomake these determinations on their own. You
know, they know their claims betterthan anybody else. They also know when
(33:57):
to involve their attorneys more especially you'vegiven their relationships that they've built in.
So we're constantly preaching. I actuallypresented to a board of directors three weeks
ago on this early intervention litigation study, and ironically enough, their questions didn't
have to do with, you know, expense payments. It was all around
(34:20):
how can we better manage the severityof these claims by involving our lawyers more
so, they were very open toit. It had nothing to do with
expenses as far as paying the attorney'sexpenses the rates. It was much more
we want to make sure that we'repaying the right amount to our injured workers,
and given what we're doing now,we just feel that we need to
involve our attorneys more. Given theirobviously their knowledge, their knowledge base,
(34:44):
but also because of the workloads oftheir folks. Right, Jake, you
know you talked about presenting the clienta few weeks ago, were you We're
aware that you gave a presentation toRIMS a few months ago in Atlanta and
part of that was about spans ofcontrol. What can you tell us about
that term that terminology and our claimsuggests being asked to do different things than
(35:09):
they were ten fifteen years ago.Yeah, absolutely, Steve, Yeah,
so I was. I was veryhonest to present at RIMS in Atlanta a
few months ago, actually presented thisvery topic on workers compensation with one of
our clients. And by spans ofcontrol, it really means two things.
The first term when it comes tospans of control is how many claims are
(35:29):
assigned on average to an adjuster,And I know we mentioned that before,
and what we're finding is that thatnumber is increasingly going up. But also
how many adjusters are assigned to asupervisor. And what we're seeing is a
lot of insurance companies on average,well we typically would recommend is you know,
one supervisor should have between six toeight claim adjusters assigned to him or
(35:52):
her. That's on average what wetypically see for the for the realm of
workers compensation for indemn the declaims,you know, medical only claims is a
little bit different. But for anindemnity claim, a supervisor for workers comps
about six to eight. Well,that number over the last couple of years
has now jumped up to nine toeleven. So think about it. If
you're a supervisor here and now youhave nine to eleven adjusters assigned to you,
(36:15):
and now they also have all higherworkloads. That means that you're getting
additional requests coming to you, authorityrequests, request for payments. Pensibility is
really becoming now, Like I mentioned, a domino effect that these supervisors themselves
are saying, I can't keep up, you know, I can't keep up
with making these decisions. A lotof them are also then saying to themselves,
(36:37):
how can I better use the resourcesthat we have at our disposal?
And that's where litigation comes in.And when I mean by litigation, that's
when using their attorneys comes in.So a lot of times I spend time
speaking to them about how do youthen say, how can I better use
our vendors? How can I betteruse defense counsel for these claims. So
that's where we come in and stayto them. You know, even with
(36:58):
these higher spans of control, morepeople you have working for you, you
really need to reach out and andprovide the autonomy to your adjusters to make
these decisions. Involve attorneys sooner.You know, if it's a complex issue,
get them on the phone. Lookat compensibility. Involve your lawyers in
the right cases as much as youcan. Then freeze you up to make
(37:20):
much more complex decisions. But alsoit allows companies to ensure that they're not
missing opportunities where they can also getinjured workers back to work quickly. And
how does you know the workers compensationindustry? How does that? You mentioned
the numbers. They are a numberof claims and a number of adjusters per
supervisor. Has that compared to therest of the insurance industry, like auto
(37:44):
or property and casualty, it's it'sit's higher Steve. So for auto and
casualty, what we're seeing is somesome carriers have much lower spans of control
because in auto and some general liabilityclaims there's much more segmentation of those claims,
and by segmentation, they focus alot on making sure that some of
(38:04):
the higher claims get assigned to specificadjusters, specific teams, wherein workers compensation
we typically don't see as much segmentation. If you have an indemnity claim,
it gets usually sent to an indemnityadjuster, and that claim could be you
know, a thousand bucks to onehundred thousand bucks. There's no differentiating up
the claims in workers compensation, whichis another reason why I think that folks
(38:27):
are suffering from turnover because of someof the people too that we're interviewing.
Say, while I'm leaving workers compensationbecause I'm going to go work in auto.
You know, two of my colleaguesthat work in auto have lower spans
of control, they have lower responsibilities, and they're making the same amount of
money. So it's almost becoming whereworkers compensation is suffering really from the fact
(38:49):
that companies are really struggling with updatingtheir processes because then they're losing talent not
only to other insurers, but they'realso losing talent internally the other divisions.
Jake, as we're kind of wrappingup here, just two questions to kind
of get your thoughts on where we'regoing where. What do you see as
in the future of the industry andwhat can these insurers, TPAs and self
(39:14):
insurance do to make sure that theyretain their good employees. So I from
what I'm seeing right now, Ryan, the future of this industry, I
think, ironically enough is becoming brighter. And the reason why I say that
is personally, when I speak toclaims executives, when I speak to these
boards, there's an acknowledgement that there'sa problem. They know that they need
(39:35):
to change the way that they're workingwhen it comes to their employees, specifically
around workers compensation. So that tome is actually a positive in this because
a lot of the plans, alot of the initiatives that they're working on
are all around workers compensation and improvingthe employee experience. So Number one,
I think that there are going tobe changes. Like anything else in any
(40:00):
workforce, it takes time. Butwhat I'm seeing is there's a lot of
acceptance on the part of the companiesthat we're working with on the leadership perspective
on investing more in their employees.So that's good. That's number one.
The second thing I think that we'regoing to start seeing is there's going to
be a lot more around the useor defense counsel. To our point here,
(40:21):
early much more early intervention initiatives thatare going to be coming down the
pipeline for defense counsel. So it'snot going to be a question anymore of
how can I, you know,lower my expenses. It's going to be
how can I use my attorneys tohelp my claims? Professionals make better decisions.
So I do think that you're goingto be involved much more earlier on
(40:42):
in claims. They're going to besome claims. Give given the work that
we're doing, you're probably gonna getinvolved in some claims that may not even
look like they're too severe, buttheir claims data shows that whether it's an
injury to a certain limb, whetherit's an injured worker where certain morbidities,
or whether it's some dynamics of aprior existing claim, they're going to start
(41:05):
involving I think defense lawyers much morein order to help hopefully predict an outcome
by having better decisions made, especiallyby defense counsel. So I do think
that that's going to be a bigchange that's coming on the fight. Okay,
well, Jake, I really thankyou for having really been great,
having you on the podcast today andthanks for taking time to speak with us.
(41:25):
I think there's a large number ofattorneys and claims professionals that's going to
find this information really useful. Andwhere can our listeners find you if they
want to get in touch with youor they want to learn more about BDEO
services? Oh? Absolutely so.If anybody would like to get in touch
with me, first and foremost,please send me an email. My email
is ja Acosta Jacosta at bdeo dotcom. You can also go on our
(41:51):
website ww dot video dot com andjust filter to Claims Advisory. All my
information is there. Would love toreach out answer any additional questions that anybody
might ask. Okay, are thereany other ways to connect with you social
media? Are you on LinkedIn?I am on LinkedIn? Please feel free
to connect with me. I've connectedwith you Ryan, and you too,
Steve. I please, I'm onLinkedIn, so please look me up Jake
(42:15):
a Costa for video and I'll bemore than happy also to connect with additional
folks. All right, great,Well, I'm glad we could get together
for this conversation and I look forwardto hearing more from you and about this
issue similar terms in the future.So thank you for joining us. Thank
you, Jake, Thanks, thankyou for having me
All right, welcome back into oursecond episode of The Conversations podcast, a
podcast developed through the Defense Research Institutewhere we explore the world of workers compensation,
including the personal aspects involved in therealm of work injuries and its litigation,
as well as future trends and everyaspect in between. My name is
(00:38):
Ryan Hathcock. I'm an attorney licensedin the state of Georgia, and with
me is my friend Steve Armstrong,an attorney licensed in the state of Kentucky.
Steve, Since today's episode is allabout adjuster turnover, I feel that
this episode is going to resonate witheveryone involved in the insurance litigation and claims
handling. I know that I sawa large out of adjuster turnover as the
(01:00):
pandemic took its effect, But inyour experience, did you run into the
same kind of thing I did.It seemed like there was a lot of
adjusted turnover, a big problem withit, and it seemed like sometimes we
were as attorneys, we were doinga lot of the work like that,
carrying the case forward. Looking forwardto speaking with Jake accost It today about
(01:23):
this issue. Yeah, right,And that's why I think this conversation is
going to be so great because weget to speak with Jake and who's an
expert in the area of consulting forinsurance companies and claims management. Jake is
a director at BDEO USA LP.He leads the claims advisory practice at b
DEO and has over twenty two yearsof experience existing companies improve the way they
(01:47):
manage their claims. In his practice, he has led numerous engagements focused on
workers compensation claim handling. So,without further Ado, welcome Jake, Thank
you for being on the podcast today. Hey Ryan, as you think,
thank you so much for having meat Jake, Ryan, we just went
through. We talked about your backgroundbriefly, but can you tell us more
about what BDEO does and what yourrole is there? Absolutely see so BDEO
(02:14):
is the fifth largest accounting firm inthe country, but we also offer a
lot of advisory and audit services toinsurance companies across the board. I lead
the claims advisory groups, so Isit in advisory and I my practice has
been I am pretty much here atBDEO for the past two and a half
(02:35):
years. I have a team ofclaims professionals that work with me and we
all have similar backgrounds, primarily inthe field of workers' compensation, where our
insurance companies come engage with us tohelp them become more efficient and how they
manage their claims. And one ofthe key topics that we help companies really
not just diagnose, but solve isturnover for front line specifically frontline workers compensation
(03:04):
turnover. It's been really something thatwe've seen a big uptick in with our
own clients the last two and ahalf years. So my team really focuses
a lot on educating clients on howthey can not just retain their current frontline
playing professionals, how can they canmake them more efficient and engage with them
more as well. Right, soundsgood? And where's video based? Where
(03:25):
are you based? So? I'mbased here in New York. My practice
is here at one hundred Park Avenuein New York. Videos home office is
also based here in New York,Okay. And do you travel or does
your team travel to go see clients? Is that how that works? It
is? Steve? I mean wetravel pretty much. I would say I'm
(03:46):
on the road about once a weekevery month, not as much travel as
we were doing before, because,like you know, like everything else not
with the pandemic, there's a lotof remote work where we just you know,
talk to clients on the phone aswe do travel. Would need to
help our clients out right, andso we have jokingly title this podcast where
did my adjuster go? But itactually is a real question. I say
(04:10):
that in the context I had twoor three litigated files where I'm on the
fourth or fifth adjuster in the spanof twelve months. Some of the adjusters
I worked with told me they wereleaving due to burn out, some had
too many claims, some said theywere promised help but they never got it.
Is that what your analysis has shownas well? Or is it other
other things like that? Now,Steve, So that's that's spot on,
(04:33):
you know. Let me give youa little bit more context to us to
what we're seeing with clients who contactme all the time asking if we can
help them out. So we dointerviews commonly with you know, senior executives,
but we really focus a lot ontalking to frontline claims professionals to really
get down to root causes and gettheir perspective. We also take a look
(04:56):
at some industry benchmarks and I'm goingto share with you it comes to employee
turnover, I think a pretty dauntingindustry statistic. Risking Insurance is also another
company that we use for benchmarking,and they do benchmarking studies every year that
we commonly also validate with clients.And one statistic that they've done over the
(05:16):
last two years is in twenty twentytwo, they interviewed various insurance companies to
talk about frontline workers, compensation,employee turnover and what they found was and
compared to twenty seventeen, a lotof folks have been really truly looking to
expand their opportunities in search employment opportunitieselsewhere. So let me just give you
(05:40):
some statistics. In twenty seventeen,a lot of the companies that were interviewed
said that twelve percent of them werelosing frontline employees at a rate of ten
to twenty percent. So ten totwenty percent in twenty seventeen, that's still
a pretty big statistic if you thinkabout losing frontline employees. But then in
twenty twenty two, just last year, they redid the study and that number
(06:04):
now jumped to thirty percent, Sothirty percent of the insurers that were interviewed
for workers compensations, said that theywere losing ten to twenty percent of their
staff A third a third of theirstaff is walking out the door for workers
compensation. And then if you alsoinclude the fact that eleven percent of them
(06:25):
said that they were losing twenty tothirty percent of their staff. So think
about that, that's forty percent ofcompanies that were interviewed, we're saying that
they're losing their frontline workers compensation professionals. And if you know, as we
all know, if you think aboutthe fact that when someone leaves you have
to sit there, you have toreassign their pending workload to someone else,
(06:46):
which creates challenges across the board.It also increases the risk that something gets
missed, fines, penalties. Soit's a pretty big problem to have.
So the big question is why youknow what's going on? And I know,
Ryan, you mentioned the post pandemic. A lot of companies are really
struggling with this hybrid working model that'swhat we call. I mean typically,
(07:09):
as we all know, a lotof these insurers had their employees come in
every single day to manage claims.They can talk to them, they can
sit there, they can review informationwith them, but now that we're in
this hybrid model, a lot ofcompanies that I know I'm working with personally
are really struggling with keeping their employeesengaged, allowing them to make much more
(07:30):
complex decisions, and really updating theirprocesses to allow them to have much more
value added abilities really to make decisionsfor workers' compensation. So, to answer
your question, Steve, this issomething too that a lot of companies are
really struggling with when it comes toproviding assistance hiring, and to your point,
(07:53):
the people who are really unfortunately sufferingthe most are the claim professionals in
the front lines, and these statisticsshow that they're leaving. They're looking to
get opportunities to go somewhere else wherethey feel more engaged, where their employers
can also allow them to help makemore decisions, less manual tasks, and
it really allows them to open uptheir abilities to also seek further opportunities where
(08:16):
they can partner with different attorneys,different medical providers to continue expanding their abilities
and not have to go back tothe traditional way of doing their work.
Right, Well, it sounds likeyou know there are a number of reasons
why there's been such an uptick inthe number of people that have been leaving
their respective jobs, and certainly thepandemic allowed for those type of changes to
(08:39):
happen to some degree, with peoplebeing at home more often than being in
the office. It sounds like you'vegot a large number of statistics from industry
data you've collected. But in yourconversations with your clients, do your clients
ever tell you that they perform exitinterviews with some of these adjusters and help
gather some information that you can useall the time, Ryan, Yep,
(09:01):
all the time. So what's interestingis that the exit interviews that they gather,
when it comes to feedback from theirclients, they break it up into
two separate buckets. They break itup into is there something that we've could
have done to keep ex employee here? So essentially, is it something that
we've could have prevented? And thensecondly, is was the employee going to
lead for other reasons that they decideto leave because they were going to pursue
(09:24):
other opportunities outside of the current field. And what we find is, ironically
enough, greater than sixty to seventypercent of the time employers have an opportunity
to do something that would have keptthat employee there. So, for instance,
allowing that employee to automating processes,automating procedures, allowing that employee to
(09:48):
make much more critical decisions, tobe an advocate for injured workers in order
to be allowing them to get backis the number one facet. The second
fact that has to do it actuallyworking from home. You know, ironically,
I don't know if you guys haveseen more companies are trying to get
employees to come back into the officemore and more now, and some employees
are just gotten to the point wherethey're looking around to see if they can
(10:09):
continue working from home because as weall know, it's a lot easier for
them, both personally and professional.So that exit interview information and stuff that
we see, we come in andwe help validate this information with these folks,
and then we help put together businessplans for them, a lot of
which also involves better use of litigationand better use of defense counsel. Another
(10:33):
facet that we do see is training. I know we spoke about training before,
but when it comes to training,a lot of times companies focus more
on new employee training for some ofthese workers. Conversation professionals, but technical
skills as what we're seeing, it'sjust it's just not enough anymore, guys.
I mean, companies really need tofocus a lot more on some of
(10:54):
these soft skills that the training werefolks, you know, things like emotional
intelligence, better communication skills, andalso allowing them to make better decisions around
negotiating settlements. A lot of timeswe also see that employees want to be
able and be involved in trying toresolve Borka's conversation claims instead of deferring that
(11:15):
to the Defense Council. So trainingis also the third function that we see
a lot that also leads to alot of folks, you know, looking
for other opportunities, right, AndI want to come back to Jake,
I want to come back to automationand training here in a minute. But
on the working from home aspect,did you do you believe that people adjusters
(11:37):
think they're going to be left behindif they are required to come back in
the office. I know some inthe media various industries talking about, hey,
we require people to come back inand you're you're really going to be
pushed the second tier if you don'tcome back into the office. A certain
number of days a week. SoSteve, that's a that's a that's a
(12:01):
big risk. So yes, toanswer your question, there's some employees who've
gotten so used to working from home. They're very productive, they're still doing
their jobs very well, but themindset for their employers has always been,
well, if I have to comeback into work, I want everybody else
to come back in. So you'reright, they do have that mindset that,
(12:22):
you know, even if they dostay home while they are colleagues,
some of them are coming back in. If they don't, it's that all
modern outage of you know, outof sight, out of mind. So
they're starting to get concerned that theirperformance will be you know, impacted,
or the way that their performance israted and evaluated could suffer from from working
from home. So yes, thatis a big risk. I can tell
(12:45):
you personally speaking, when I speakto managers, and I speak to them
all the time on workers compensation impactsand claims, they tell me that it's
so much easier to be able towalk out and talk to folks, especially
when it comes to nurse, medicalcase managers and other vendors that they use
having them either on site or beingavailable twenty four seven is something that impacts
(13:07):
them. But when you get downto their front line staff, a lot
of the questions that they say is, well, you know, I'm always
on the phone, I'm always talkingto engine workers, I'm talking to my
attorneys. Why do I have tobe in an office twenty four to seven?
So that's type of information and thattype of you know need from a
frontline position. We spend so muchtime on a change management aspect with insurers,
(13:31):
just making sure that they're aware thatyou know, there are very easy
and really, quite frankly, updatingprocesses and procedures and looking at using technology
and automating is so much easier todo in today's world, post COVID,
post a pandemic, that you reallyhave to change your mindset. And if
you don't, statistics are showing employeesare just going to start looking around.
(13:56):
And then there are companies out therewho are really differentiating themselves and you're going
to be facing more turnover unless youstart changing the way you look at the
workforce. Right And I will tellyou from a personal standpoint, I tried
to go up to see a clienta few hours away from here a couple
of years ago at the end ofthe pandemic, and they said, you
(14:16):
can't come, Steve, because we'veclosed our office and everybody's at home now.
And so I think it was someof the clients I had were heading
that way to begin with, butsome were not. So I think this
COVID issue is really forced the changeover there with those particular clients. But
I don't think everybody's gone to theidea of everybody working from home yet.
(14:43):
If we could come back to training, do you have any ideas on how
best to train people who are goingto be working at home? What is
your research show there? Oh?Absolutely, Steve so training. When it
comes to training, there's two facetsthat we commonly work with folks on.
What we typically do is when itcomes to technical training for workers compensation,
(15:05):
we really focus a lot on havingoptions for employees. So there's some employees
who when you know, when youstart at a new company, you want
to be able to talk to colleagues, you want to be able to meet
your boss and meet the leadership team. So what we commonly work with some
clients who do still have real estateand still have office space, we preach
to them that they should be bringingfolks in that our new hires, you
(15:28):
know, that they can sit down, work with them, do technical training,
but then also allow them, ifneed be, to start working from
home and in a in a hybridcondition, you know, maybe three four
times a week. They come in, but slowly as they start matriculating and
start becoming more productive in their owngetting more comfortable, allowing them to go
(15:48):
back and work from home. That'sthat's a number one training aspect is having
that manager come in, work withthem in an office and then slowly migrating
them to work from home. Butthen when it comes to other employees,
the folks that have been working thereand they're more experienced, well, we
commonly preach funny enough is not trainingthem, is actually training their managers and
(16:11):
their supervisors. It really becomes afacet of really trying to help leadership and
help the management team get more comfortablewith the fact that their employees are not
right outside their doors and they're notin an office space. The workers compensation
is very, as you guys know, very complex, a lot of compliance,
(16:32):
a lot of forms to fill out, a lot of things to do,
and I just think as an industry, we've gotten so comfortable with having
people right there around us that whenthey're working from home, people which just
automatically assume that there's a greater levelof risk because of distractions. And what
we're working with clients on commonly ontraining plans allowing their supervisors to look at
(16:53):
things a little bit differently. Youcan monitor performance, you can take a
look at what's outstanding, what forms, what payments, all these reports that
are typically pulled, you can monitorthose whether you're working from home or working
in an office. So I spenda lot of time working with claims managers
and chief claims officers on just educatingthem on all the facets around being able
(17:17):
to be more productive and governance withhaving a remote workforce. So, actually,
Steve and Ryan is not most forthe more experienced people, is not
really training them to work from homeas much as it is training their supervisors
to get more comfortable with obviously theconcept. Yeah, absolutely, and one
I think we can agree that oneof the largest issues with adjuster turnover is
(17:41):
this new ability to work from homeor versus come back in the office.
I think the second thing that we'venoticed in our conversations with some of our
clients is just the amount of workload. Sometimes I'll get on the phone with
an adjuster and they just keep tellingme how swamp they are, how they
haven't seen emails or they just haven'tgotten to it. So find that to
be another reason they look for atransition to a new company is or can
(18:03):
you work from home? And canthey have a workload they can manage?
So you mentioned something about automation,and I assume that companies that are doing
that will allow their adjusters to manageor workload better if half of their work
or some of their work is automated. So can you discuss what you've seen
in terms of workload management? Hasthat gotten better? And also in terms
(18:25):
of automation, what have you seenwith that so far and where is that
going and how can that help adjustersmanage their workload? Yeah, no,
absolutely, Ran. So to yourfirst question around work workloads and their inventories,
we've actually seen an uptake and thenumber of claims assigned to an adjuster.
And let me be specific and giveyou some some statistics. So on
(18:48):
average, what we're seeing when itcomes to workers compensation, is that an
indemnity adjuster or a worker's conversation indemnityadjuster what typically have between one hundred and
twenty five to one hundred and theopen claims typically yes, and that can
vary, but I mean, youknow, on average it's about one twenty
five to one fifty eight. Whatwe're seeing now over the last six to
(19:11):
nine months and working with clients andwith our team, then that number is
almost doubled, between two hundred andfifty to three hundred claims. And the
number one pain point to that isturnover. Yeah, Steve, you know,
We'll come in and do interviews andI'll speak to managers and they're like,
well, yeah, you know,Jake has a high inventory right now
(19:32):
because we just lost someone, soI had to transfer claims over to him
temporarily. And that temporarily can meanwhat four six, eight weeks? I
mean, who knows until they startinterviewing people, so it becomes it becomes
almost a dominant effect. Once thesecompanies start losing these folks and they have
to start reassigning claims, they commonlysay to us, my workload is just
(19:55):
unmanageable, and how long is thisgoing to last? You know, how
long is it going to be thatI'm going to be managing all these claims
and I can't get to things,So it's a it's a significant problem to
have the second part of your questionI had to do with automation. So
companies are investing more and we're seeingit much more when it comes to automating
some tasks when it comes to workerscompensation. You know, I did an
(20:18):
interview two weeks ago with a frontlineclaim supervisor actually, and she told me
that on average, and this isa number that I found daunte on average,
forty percent of their time it's it'sspent on something on an activity that
they consider either administrative or a complianceactivity. And let me give you an
example of that administrative meaning that they'llthey'll literally have to spend time filling out
(20:42):
a form to have someone else sendout a payment, or manually filling out
a form under a computer to toyou know, sen send send a vendor
out for workers compensation, or fillingout a form and sending it to their
manager to get approval for either anexpense or an indentity payment. So if
(21:03):
you think about all this time that'sspent, and I keep asking questions around,
well, how long has it takenyou to get a response? How
long does it take you to getfollow ups. They can take days on
average for them to actually get informationback, or to get things approved from
a payment perspective, or to getanything done. So if you multiply all
these activities out by these higher workloads, I mean, these claimed professionals are
(21:29):
literally sitting there saying I can't getanything done. I'm literally sitting here,
I have a high inventory. Myemployer now telling me I have to go
back to the office to go towork. So that's becoming a bigger strain.
And now I'm doing a lot ofthese administrative tasks that I think could
easily be automated. So it's it'sreally a triffect when it comes to all
these issues that they're having. Sothe solution that we're working with clients is
(21:53):
on consistently have to do with youhave to take a look at your operating
model, you know, are piecingaway some of these tasks and start using
your folks better. You know,when it comes to workers compensation, your
people should be primarily five percent oftheir tasks should be on compliance and administrative.
It's validating things that other people haveset up for them. Payments,
(22:15):
compensibility decisions are things that they needto be focusing on, not filling out
forms for payments for the workers compdivision. So it's really just taking a
look at your model more than itis changing the entire dynamic of handling claims
and then workloads too. So Iactually work with some clients that when they're
(22:36):
having turnover issues, their managers takeon claims in order to and then that
brings up an additional set of challenges. So the question becomes, how do
you really focus your time making surethat the workloads that your employees have is
manageable. How do you know thatyou can take away certain activities that it
can make them more productive, thatthey can start closing out some more of
(22:57):
these claims. And then from atraining perspective, a lot of the advice
that we've your clients is partner withyour attorneys more. You know, these
relationships with Defense Council in the pastused to be very technical. As you
gentlemen know you got you were alwaysretained on the technical side. But man,
there's a wealth of information that DefenseCouncil can do. From a training
(23:18):
trending perspective, Partner more with themto allow you allow them to come in
do training, help out your staffon what they're seeing locally. That can
free up your managers more to domore of the you know, obviously more
complexes, right. And sometimes alongthose same lines, sometimes we see a
fairly small claim that could be settledquickly, but the claims that we're dealing
(23:41):
with has to present it to agroup of people, a team, and
you know that's been We've seen thata long time. But we have to
prepare a report and then they taketheir own report, they take our report,
prepare their report, and then theyhave to meet with some people to
get authoritied settle a claim, andit takes weeks to get that move forward.
(24:04):
In the meantime, Ryan I,other attorneys are having to say,
Judge, we need more time toget to the point where we can even
talk about settling the claim. Haveyou seen anything like that, especially in
the TPA context, and what advicewould you give to decision makers on that?
So, yes, the authority requestis the number one pain point that
(24:30):
we see from a supervisor perspective aswell. And by authority of a questure,
right, there are numerous stakeholders withsome organizations that have to see a
claim based on a certain threshold.You know, they want to settle a
claim for ten twenty thousand dollars,I have to go to one person,
but to higher up you go.When it comes to the amount of money
that's being requested, the more peoplethat are typically involved. So what we
(24:53):
typically look at is, well,how long is it taking and what's the
governance process? And we mainly comein and speak to not just our own
individual clients, but to t pasall the time to say can we streamline
this process to where maybe it's justone individual that has the authority that can
take a look and approve because toyour point, you have attorneys that are
(25:17):
waiting, having to go back toget deferments because it's just taking so long.
I mean, one client that wecurrently work with, we did a
time study on all the activities froma workers conversation perspectives that it takes and
on any claim greater than one hundredthousand dollars one hundred thousand dollars settlement,
it takes on average eight to sixteendays to get approval. And the next
(25:41):
question that I had was, well, how many times does an authority of
requests go up where it gets denied? You know, essentially it's either denied
or setting back for additional information,and the answer was none. Every time
an authority request was processed, itultimately got approved. It just took between
eight to sixteen days for it.I think about that, that's almost a
month where they're waiting to get authorityback. So what we do is we
(26:06):
come in and we commonly tell folks, take a look at your processes.
A lot of these companies and eventhe t PAS guys, they're still following
processes and plans that they've had inplace for decades where you'll have to present
to numerous individuals. You'll also havedefense council potentially have together reports. We're
telling them you need to streamline thisthat essentially you have to cut this down
(26:30):
to at a minimum two to fivebusiness days that these requests get evaluated and
then hopefully either approved or you getfeedback to the adjuster. And it all
starts with updating their internal policies andprocedures or even their own TPA guidelines that
they have in place with their customers. Right, I can tell you with
one of the more agile clients thatgot we'll have this exercise and we'll prepare
(26:52):
our reports fairly quickly they're fairly small. And then if we need to get
on with the decision maker at theemployer and the TPA, we can do
that fairly quickly, as in threeor four days on a video conference just
like this, and the decision willbe made. And so that that is
an example of when it really works. If we could, for just a
(27:15):
minute, I'd like to go backto during COVID in the recruiting process since
COVID. During COVID, we sawpeople coming in to this industry from other
industries to work as adjusters. Isaw nurses, I saw people who had
been in other fields and they'd neverbeen to the insurance industry at all.
And the people I dealt with didn'tlast very long. How do you where
(27:41):
do we recruit from now? Andwhere should employers, self insured employers,
tpa's insurers recruit from straight out ofschools or certain age or I don't know,
you know, you know, it'sfunny when I typically speak to new
(28:02):
adjusters, they come out of strictlyout of college. You know. We
commonly ask them, you know,you know, what made you get into
insurance and primarily what made you getinto claims? And they kept mentioning that
there were so many job openings aroundfor workers compensation primarily that they decided,
you know, it's something too thatthey had a lot of opportunities to come
in, which I think is anindustry is an interesting against an interesting piece
(28:25):
of feedback. So what we commonlydo, ironically enough, a lot of
the companies that we work with,they actually recruit directly from t pas so
TPAs that they work with, they'llrecruit from there if they have an internal
claims function, But they also spenda lot of time recruiting out of local
colleges, local communities. When itcomes to getting folks right out of school,
(28:48):
they really want to make sure thatthey bring folks that are have a
local presence because, as we allknow, workers compensation has so many local
jurisdictions, that has so many localvariance to it. So they spend a
lot of time doing a lot oflocal recruiting. I can tell you too
from an experienced perspective. Having thishybrid model also allows you now to recruit
(29:11):
talent all across the country. Imean, that's one of the benefits is
if you're a company that allows forremote work and hybrid work, you no
longer have to just primarily focus onhaving folks primarily around where an office location
is. You can recruit across thecountry. So we spend a lot of
time working with companies saying to them, you know, even if you are
having an issue with local talent,you know, when it comes to working
(29:33):
remotely, these are some solutions thatyou can provide yourself to open up your
talent across the country and as aneven bigger initiative and an even bigger benefit
for folks to have folks that theycan actually pull and plug and also assign
different work too. If you're havingan issue with workflow, is expanding that
you know, you know, jobbase across the country that you can have
(29:56):
folks all across you know, postingand working. From a workers perspective,
I'm gonna switch courses here because froma litigation side, and this is what
the attorneys listening to them would liketo hear more about, is you know,
we know the insurance game is allabout numbers and trying to be cost
efficient, but in many instances,I feel like claims adjusters are hesitant to
(30:21):
send over cases early on for thepurposes of reducing their litigation costs. But
in many ways if they would justinvolve us earlier on, we might be
able to get a better handle onthe cost, whether it's medical or just
a decision related to compensibility. SoI know that's got to be an issue
in which you see where they wherea company wants to save on litigation costs,
(30:41):
but also find and maybe bringing inlitigation earlier on might be the way
to save money. What are yourthoughts on that, Ryan? I agree
with you. In fact, I'mworking on two engagements right now with two
insurance companies where we're actually completely revampingthere aigation management strategies and the number one
(31:03):
facet is early intervention, Like that'stheir number one initiative. And it's funny
both insurance companies that we're working withwith this early intervention, the main reason
why they're also involving their attorneys more, you know, earlier on in the
process has to do with the factthat they don't have a lot of experience
right now because they're going through turnoverissues from a workers comp you know,
(31:26):
employee perspective, so they want tobe able to bring in and bounce off
and have essentially their attorneys earlier oninvolved in these claims because to your point,
it's not a question of whether ornot they want to lower expenses,
is that they really want to makesure that they can control the severity of
somebody's claims as well by making betterdecisions. And the reality is by involving
(31:48):
litigation attorney's defense counselor earlier on,especially in somebody's claims, to have the
propensity to go down the road tobecome even higher severity losses is crucial Trusia.
So I'm actually working with these two, these two companies on identifying the
best way to involve which cases toinvolve attorneys in sooner. So there's a
(32:09):
lot of predictive modeling that goes in, there's a lot of work that's done
on the back end taking a lookat auditing claims to be able to identify
which claims could have had an impactby having legal involved quicker or sooner,
I should say, but it's alsosomething that I'm seeing across the boards across
my client bases, you know,Jake, where should I bring in legal
(32:30):
sooner and how can I better partnerup with them instead of just waiting until
litigation is commenced, where essentially thatwe're playing catch up instead of being able
to prevent and mitigate some Ofdy's exposure. Yeah, and I guess along the
same lines. Have you seen wherethere's been a conversation with your clients about
if we bring in litigation earlier,maybe that reduces the workload on our adjusters
(32:52):
because they can move on to anotherfile. In some ways, that would
reduce that turnover because they don't feelswamped on by a particular issue that they're
having problem with, but they justdon't feel that their manager would allow them
to send this issue over to litigationyet. So if they're just allowed and
have that freedom to say, ifyou get bogged down on a case,
go ahead and send it over tooutside counsel. Let's get it moving and
(33:13):
then you can switch over to anew file. Has that conversation ever arose
it? Has it has? Ryan? Yeah? So, I mean that's
that's exactly where I think it hasto do with trusting your adjustice to make
the right decision. So when itcomes to making some of these decisions or
some of these claims, we're actuallyseeing that more companies are becoming more flexible
by having their adjusters where fur casesout pick up the phone, contact Defense
(33:37):
counsel get an opinion on compensibility ifit's something that they're not too sure of,
instead of waiting for their manager toget back to them on making a
decision, they're allowing. And whatwe're recommending the companies is you should really
allow the autonomy for your adjusters tomake these determinations on their own. You
know, they know their claims betterthan anybody else. They also know when
(33:57):
to involve their attorneys more especially you'vegiven their relationships that they've built in.
So we're constantly preaching. I actuallypresented to a board of directors three weeks
ago on this early intervention litigation study, and ironically enough, their questions didn't
have to do with, you know, expense payments. It was all around
(34:20):
how can we better manage the severityof these claims by involving our lawyers more
so, they were very open toit. It had nothing to do with
expenses as far as paying the attorney'sexpenses the rates. It was much more
we want to make sure that we'repaying the right amount to our injured workers,
and given what we're doing now,we just feel that we need to
involve our attorneys more. Given theirobviously their knowledge, their knowledge base,
(34:44):
but also because of the workloads oftheir folks. Right, Jake, you
know you talked about presenting the clienta few weeks ago, were you We're
aware that you gave a presentation toRIMS a few months ago in Atlanta and
part of that was about spans ofcontrol. What can you tell us about
that term that terminology and our claimsuggests being asked to do different things than
(35:09):
they were ten fifteen years ago.Yeah, absolutely, Steve, Yeah,
so I was. I was veryhonest to present at RIMS in Atlanta a
few months ago, actually presented thisvery topic on workers compensation with one of
our clients. And by spans ofcontrol, it really means two things.
The first term when it comes tospans of control is how many claims are
(35:29):
assigned on average to an adjuster,And I know we mentioned that before,
and what we're finding is that thatnumber is increasingly going up. But also
how many adjusters are assigned to asupervisor. And what we're seeing is a
lot of insurance companies on average,well we typically would recommend is you know,
one supervisor should have between six toeight claim adjusters assigned to him or
(35:52):
her. That's on average what wetypically see for the for the realm of
workers compensation for indemn the declaims,you know, medical only claims is a
little bit different. But for anindemnity claim, a supervisor for workers comps
about six to eight. Well,that number over the last couple of years
has now jumped up to nine toeleven. So think about it. If
you're a supervisor here and now youhave nine to eleven adjusters assigned to you,
(36:15):
and now they also have all higherworkloads. That means that you're getting
additional requests coming to you, authorityrequests, request for payments. Pensibility is
really becoming now, Like I mentioned, a domino effect that these supervisors themselves
are saying, I can't keep up, you know, I can't keep up
with making these decisions. A lotof them are also then saying to themselves,
(36:37):
how can I better use the resourcesthat we have at our disposal?
And that's where litigation comes in.And when I mean by litigation, that's
when using their attorneys comes in.So a lot of times I spend time
speaking to them about how do youthen say, how can I better use
our vendors? How can I betteruse defense counsel for these claims. So
that's where we come in and stayto them. You know, even with
(36:58):
these higher spans of control, morepeople you have working for you, you
really need to reach out and andprovide the autonomy to your adjusters to make
these decisions. Involve attorneys sooner.You know, if it's a complex issue,
get them on the phone. Lookat compensibility. Involve your lawyers in
the right cases as much as youcan. Then freeze you up to make
(37:20):
much more complex decisions. But alsoit allows companies to ensure that they're not
missing opportunities where they can also getinjured workers back to work quickly. And
how does you know the workers compensationindustry? How does that? You mentioned
the numbers. They are a numberof claims and a number of adjusters per
supervisor. Has that compared to therest of the insurance industry, like auto
(37:44):
or property and casualty, it's it'sit's higher Steve. So for auto and
casualty, what we're seeing is somesome carriers have much lower spans of control
because in auto and some general liabilityclaims there's much more segmentation of those claims,
and by segmentation, they focus alot on making sure that some of
(38:04):
the higher claims get assigned to specificadjusters, specific teams, wherein workers compensation
we typically don't see as much segmentation. If you have an indemnity claim,
it gets usually sent to an indemnityadjuster, and that claim could be you
know, a thousand bucks to onehundred thousand bucks. There's no differentiating up
the claims in workers compensation, whichis another reason why I think that folks
(38:27):
are suffering from turnover because of someof the people too that we're interviewing.
Say, while I'm leaving workers compensationbecause I'm going to go work in auto.
You know, two of my colleaguesthat work in auto have lower spans
of control, they have lower responsibilities, and they're making the same amount of
money. So it's almost becoming whereworkers compensation is suffering really from the fact
(38:49):
that companies are really struggling with updatingtheir processes because then they're losing talent not
only to other insurers, but they'realso losing talent internally the other divisions.
Jake, as we're kind of wrappingup here, just two questions to kind
of get your thoughts on where we'regoing where. What do you see as
in the future of the industry andwhat can these insurers, TPAs and self
(39:14):
insurance do to make sure that theyretain their good employees. So I from
what I'm seeing right now, Ryan, the future of this industry, I
think, ironically enough is becoming brighter. And the reason why I say that
is personally, when I speak toclaims executives, when I speak to these
boards, there's an acknowledgement that there'sa problem. They know that they need
(39:35):
to change the way that they're workingwhen it comes to their employees, specifically
around workers compensation. So that tome is actually a positive in this because
a lot of the plans, alot of the initiatives that they're working on
are all around workers compensation and improvingthe employee experience. So Number one,
I think that there are going tobe changes. Like anything else in any
(40:00):
workforce, it takes time. Butwhat I'm seeing is there's a lot of
acceptance on the part of the companiesthat we're working with on the leadership perspective
on investing more in their employees.So that's good. That's number one.
The second thing I think that we'regoing to start seeing is there's going to
be a lot more around the useor defense counsel. To our point here,
(40:21):
early much more early intervention initiatives thatare going to be coming down the
pipeline for defense counsel. So it'snot going to be a question anymore of
how can I, you know,lower my expenses. It's going to be
how can I use my attorneys tohelp my claims? Professionals make better decisions.
So I do think that you're goingto be involved much more earlier on
(40:42):
in claims. They're going to besome claims. Give given the work that
we're doing, you're probably gonna getinvolved in some claims that may not even
look like they're too severe, buttheir claims data shows that whether it's an
injury to a certain limb, whetherit's an injured worker where certain morbidities,
or whether it's some dynamics of aprior existing claim, they're going to start
(41:05):
involving I think defense lawyers much morein order to help hopefully predict an outcome
by having better decisions made, especiallyby defense counsel. So I do think
that that's going to be a bigchange that's coming on the fight. Okay,
well, Jake, I really thankyou for having really been great,
having you on the podcast today andthanks for taking time to speak with us.
(41:25):
I think there's a large number ofattorneys and claims professionals that's going to
find this information really useful. Andwhere can our listeners find you if they
want to get in touch with youor they want to learn more about BDEO
services? Oh? Absolutely so.If anybody would like to get in touch
with me, first and foremost,please send me an email. My email
is ja Acosta Jacosta at bdeo dotcom. You can also go on our
(41:51):
website ww dot video dot com andjust filter to Claims Advisory. All my
information is there. Would love toreach out answer any additional questions that anybody
might ask. Okay, are thereany other ways to connect with you social
media? Are you on LinkedIn?I am on LinkedIn? Please feel free
to connect with me. I've connectedwith you Ryan, and you too,
Steve. I please, I'm onLinkedIn, so please look me up Jake
(42:15):
a Costa for video and I'll bemore than happy also to connect with additional
folks. All right, great,Well, I'm glad we could get together
for this conversation and I look forwardto hearing more from you and about this
issue similar terms in the future.So thank you for joining us. Thank
you, Jake, Thanks, thankyou for having me
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