Many employers believe that "bad" or fraudulent employees drive up workers’ compensation costs. When an employee is off on workers’ comp for an extended period of time, it’s not uncommon for an employer to say, “Tom was a model employee for many years. I can’t believe he’s milking the system. He should have been back to work weeks ago.”
While the notion of abuse is widespread, particularly for such "invisible" injuries as strains and sprains, good employees can be vilified unjustly. However, it’s often the system that induces needless disability leave and high costs.
Fraudulent claims are those filed by employees who were never hurt but say they were, or who were hurt outside of work and claim the injury is work-related. They make for memorable anecdotes—the employee with the injured back who is seen on video salsa dancing. But the far bigger problem is workers who don’t get well as expected, not because of intentional malingering but as a result of delayed recovery. In other words, disability duration is out of proportion to the severity of the injury or illness.
Misdiagnoses and Mistreatments
For many, the injury begins as a common problem—a sprain, back injury, or a slip and fall—that escalates into a prolonged or even permanent withdrawal from the workforce.
Consider this hypothetical example: An employee is lifting a 50-pound package from a truck and injures his lower back. According to a study by Dr. Elizabeth McGlynn of RAND Health, the employee has only a one in three chance of receiving the proper diagnosis and care on the first medical visit when back pain is present.
For back pain, employees have a
one in three chance of receiving
proper diagnosis and care.
A physician may order an MRI and prescribe musclerelaxants and narcotics for pain relief, when the proper treatment may have been rest, over-the-counter pain relievers and return to work in modified duty. With misdiagnoses come excessive testing, unnecessary treatments, long delays in returning to work and higher costs for the employer.
Even worse, there are unfortunate consequences for employees.
Employees may experience negative side effects from the drugs, lose muscle tone, develop atrophy and feel worse, rather than better. Although some workers will cope with the problem and work through it, others cannot. Representing a small percentage of the claims—6 to 7 percent—it is this group that accounts for a large percentage of costs. For them, the medical issues are further exacerbated by social and psychological factors.
Sinking Into Depression
Injuries disrupt workers’ daily lives. Even a minor injury may seem like a major occurrence because it is unfamiliar and frightening, or it occurred at a time when there is stress in the workers’ lives. Employers often fail to inform employees about what to expect when an injury occurs, creating further anxiety.
Worried about how their co-workers perceive their injury, they quickly become socially isolated, lose their sense of productivity and purpose and can sink into depression. Their ability to deal with the frustration and pain lessens and the magnitude of the injury becomes distorted. Yet, the system keeps treating them medically.
Prolonged absences then morph into a "disability attitude." Work defines a person’s identity in a number of ways, including the self-respect that comes from earning a living. According to clinical psychologist Dr. Kevin Gaffney, “With delayed recovery comes the issue of identity disturbance” (from Understanding the Injured Worker).
When that identity is taken away and the claim progresses beyond the expected medical recovery, injured employees begin to view themselves as disabled. The longer an employee stays away from the workplace, the more difficult it becomes to re-establish the discipline of being on the job eight hours a day. Once this disability attitude sets in, the motivation to return to work is compromised.
The longer an employee is away,
the harder it is to re-establish the
discipline of being on the job.
In fact, the longer workers stay away from the workplace, the less likely it is that they will return. Research confirms that there is only a 50 percent chance that an employee who has been absent for 12 weeks will return to full employment.
Encouragement, Not Vilification
While injured workers need encouragement and nurturing, the employers’ reaction—or lack of action—often aggravates the situation. Harboring feelings that injured employees are the “villains,” the employer often focuses on resolving the resulting production issues and has little or no contact with them. The injured workers’ sense of self worth and identity spirals downward, while animosity and distrust build. Litigation begins to look like the only alternative.
A report by the American College of Occupational and Environmental Medicine, Preventing Needless Work Disability by Helping People Stay Employed, notes that only a small fraction of medically excused days off work are medically required—meaning that work of any kind is medically contraindicated. The remaining days off result from a variety of non-medical factors such as administrative delays of treatment and specialty referral, lack of transitional work, ineffective communications, lax management and logistic problems.
These days off are based on non-medical decisions and are discretionary or unnecessary. Participants in the disability benefits system seem largely unaware that so much disability is not medically required. Absence from work is “excused,” and benefits are generally awarded based on a physician’s decision confirming that a medical condition exists. This implies that a diagnosis creates a disability.
Simply put, claims become exaggerated when a worker gets hurt, gets frustrated, is not recovering and no one is talking to him or her. Eventually good workers slide into self-destructive behavior. Too many employers believe that these workers are malingerers or, even worse, crooks. Rarely do they recognize that the real threat is not the cost of the claim, but the loss of a valuable, competent employee who is unnecessarily out on a disability that the system has created.
Early Intervention Is Key
Workers’ compensation is not “found” money. Unlike personal injury settlements, workers’ comp is a “no-fault” law. Lump sum settlements are usually based on estimates of how long employees are likely to be unable to work. Each state varies in the maximum and minimum amounts required for weekly temporary disability benefits, as well as in how any permanent disability is determined.
In addition to the physical pain, and the loss of their self-image as self-sufficient members of their families and society, injured and ill workers can face financial difficulties. No one who has been out on workers’ comp has improved their life as a result.
To avoid this debacle, early intervention is key. Employers need to understand that workers’ compensation is not strictly a financial issue but a people issue. Bringing injured employees back to work as soon as possible in a medically approved capacity is the cornerstone of preventing long-term disability.
When the people component is managed well, better financial outcomes follow.
Frank Pennachio, CWCA, is co-founder and director of learning at the Institute of WorkComp Professionals in Asheville, N.C., the largest network of workers’ compensation professionals in the nation. He is also president of a workers’ compensation insurance agency, and a licensee and trainer for Injury Management Partners. A well-known speaker, his articles appear regularly in business and trade association publications.