The Cost of Risk: Taking pains to save money

Despite the efforts of even the most aggressive safety department to prevent workplace injuries, sometimes accidents happen or supposedly happen. Either way, a poorly managed workers’ comp claim can cost you dearly.

Safety awareness and training and tools such as functional capacity testing may yield the greatest payback in cutting workers’ comp costs, but some realities of the trucking industry – an aging work force and a lack of constant supervision, for example – make claims inevitable, says Gerald Cooper, an attorney with the Chicago office of the law firm Scopelitis, Garvin, Light & Hanson. Cooper last month conducted a Truckload Carriers Association audio conference on workers’ compensation.

Once a workplace accident occurs, the motor carrier and its partners, such as the insurer or third-party administrator, need to act quickly and thoroughly, Cooper says. Documentation is key. For example, companies should require that an employee complete an injury report, including a section that requires an employee to circle the injured body part. “This freezes the accident and prevents or hinders the driver from embellishing the circumstances and results of the accident,” Cooper says.

Light duty
Following the initial treatment, the physician often will release an employee for a light-duty assignment pending a recovery that allows him to return to work. Light-duty assignments allow the employer to keep the employee engaged and ensure he is completing any scheduled medical appointments or rehabilitation. These are temporary positions and are not offered beyond the maximum medical improvement, Cooper says.

What happens if the employee fails to cooperate with the company’s light-duty program? State law varies as to whether and when employers may terminate workers’ comp benefits for failure to comply with the terms of a light-duty assignment, Cooper says. But it is clear that motor carriers would need to have established policies regarding the consequences of refusing to participate in or cooperate with light duty, he says.

In eight states, motor carriers are allowed to cover owner-operators under their own workers’ comp policies with a chargeback to the owner-operator for this coverage. In those cases, the motor carrier should avoid requiring light duty, as doing so could destroy the owner-operator’s independent contractor status, Cooper warns.

Fraud and malingering
The trucking industry is particularly susceptible to workers’ compensation fraud, Cooper says. “Drivers are usually far from home. The accidents are not witnessed. And the dishonest driver has hours sitting in the cab to come up with a good story.” Fraud takes two forms: outright fraud and the more common practice of padding the claim or malingering.

Outright fraud – where a driver has staged an accident, for example – is hard to fight because employees usually report the accident long enough after it supposedly occurred that a meaningful investigation may be difficult. The principal tactic in these cases is interviews with co-workers to see whether the employee had indicated any plans to get back at the employer. Medical records secured in the investigation can help determine whether the employee had a pre-existing condition. You may not be able to prove fraud, but there’s a larger goal, Cooper says. “Vigorous defense of suspicious claims gives the injured driver and co-workers the message that the company means business.”

More often, a driver didn’t fake the original injury, but he might be prolonging his workers’ comp status beyond the period of true disability so that he can take it easy and keep getting paid. If an employer suspects malingering, it often retains a surveillance firm in an effort to videotape the employee performing activities that go far beyond the physical restrictions imposed by the doctor. Such evidence generally is successful in defeating a workers’ comp claim in court, although criminal prosecutions for fraud in malingering cases are less likely to succeed. Still, pressing charges likely will get the attention of other employees.

To purchase a recording of the Truckload Carriers Association audio conference on CD or tape, go to this site.