Debbie Michel is president of Helmsman ManagementServices LLC, a wholly owned subsidiary of Liberty MutualInsurance, one of the nation's largest property and casualtyinsurers. With over $5.5 billion in losses under management,Helmsman is the TPA partner of choice for businesses with 1,000employees or more.

National Underwriter: Are there any specifictrends in the workers comp space that you've identified in the twoyears since you've led Helmsman Management Services? Things thatperhaps both insurers and client organizations should keep an eyeon?

Debbie Michel: With the average medicalcost per workers compensation lost time claim continuing to grow,and looming changes in our healthcare delivery system, there is arenewed interest in holistic health and wellness.

The employer community is just beginning to address thesignificant impact of co-morbid conditions on workers compensationinjuries and overall healthcare costs.

Of course, medical treatment and pharmacy costs – particularlydriven by potential narcotic over-prescription and abuse – continueto be a high priority issue. Employers are seeking innovativeways to manage these costs across the workers compensation andgroup health space.

On the treatment side, employers are interested in making sureinjured employees have access to those medical providers mostlikely to deliver the best outcomes cost-effectively. Theyare keenly interested in measuring provider performance based onoutcomes rather than costs, recognizing that quality care up frontoften means lower claim costs down the road.

NU: What are some of the ways in which Helmsmanhas evolved in serving its clients' needs? Have you seen any newertypes of client requests that you might not have in years past?

DM: While the goal of our customer service isconstant – to continually make it easier for employers to bettercontrol workers compensation claim costs – technology has evolvedhow we achieve that strategy.

This is most clearly seen in two areas: data analysis andcommunication.

Today, technology allows sophisticated data analysis thatcreates the tools needed to better manage workers compensationcosts. Data helps quickly identify problematic claims –such as an injured worker receiving narcotic prescriptions frommultiple medical providers – and build the resources that get thoseclaims back on track, such as networks of providers more likely toproduce better outcomes cost-effectively.

Technology has also sped the flow of deeper claimsinformation. A single online claims management system enablesall parties – employer, broker, claims manager, medical director,nurse case manager, adjustor, et cetera – to quickly shareinformation on a specific claim or entire set of claims. Faster, more detailed information to a wider range of stakeholdershelps produce better outcomes and lower total claim costs.

NU: How much of a role does predictivemodeling play in Helmsman's work?

DM: Predictive modeling has been an importantpart of our claims management philosophy for more than a decade.

We analyze data to find actionable information that helpsemployers better manage the total cost of workers compensation,from taking action on a specific case to developing tools that helpimpact all claims, such as our provider networks. In working towardthis goal, we are fortunate to be able to leverage the vast arrayof data available to us as the third party administrator subsidiaryof Liberty Mutual Insurance.

The most critical aspect of any predictive modeling program ishow data is turned into actionable information and shared at theright time with claims staff.

We have focused on broad-based models that help identify claimsthat are at risk, as well as decision-point models that providereal-time decision support on specific issues. Models canidentify claims in need of medical support, fraud investigation oreven claims with compensability issues within the first 10 daysafter report of claim.

Once identified, we support our claims staff with both tools andexperienced professionals dedicated to guiding them on alertedclaims.

NU: What are some of the loss-control protocolsthat Helmsman employs to combat workers comp fraud?

DM: Helmsman's Special Investigations Unit(SIU) partners with all internal and external stakeholders in thedetection, investigation, and prevention of commercial insurancefraud.

Our claims staff is trained to identify suspicious – or“red-flag” – indicators. Over 50 SIU personnel provide expertanalysis and perform investigative tasks to help ensure that claimshandlers reach fair decisions. The SIU investigator staff is madeup of seasoned claims professionals and individuals with lawenforcement backgrounds.

We have various predictive models and business rules that run onour workers compensation claims to identify potential fraud. Thoseare reviewed by our triage team to determine if an investigationshould occur. The triage team and modeling team work togetherregularly to continuously refine and improve the models andbusiness rules.

Additionally, claims has created a social media team that doesmore than simply respond to referrals for investigations. The teamtakes a systematic approach to social media investigations byemploying a vetted process that proactively seeks publiclyavailable, non-private information and makes it available to ourcase handlers for use in determining whether the informationsupports the injury or conflicts with the injury and/ordisability.

To address provider fraud, we have an analytic team thatsupports our Complex Fraud Investigators. This team is able toanalyze our workers compensation medical data to identifyconcerning trends related to provider treatment and/or billing.

NU: Which states do you find particularlychallenging to operate in, when it comes to administering workerscomp claims, and what are some of the solutions you've developed tothat end?

DM: New York and Illinois are two states thatprovide significant workers compensation challenges to riskmanagers, TPAs and insurers.

In New York, medical inflation is a key cost driver. Arecently proposed medical fee schedule based on Medicare –together with pain management guidelines – will hopefullyhelp in controlling workers compensation claim costs in thestate.

Growth in the New York State Workers Compensation Fund remains aconcern. In order to create a more robust private workerscompensation market in the state, buyers, brokers, agents, TPAs andinsurers are working with regulators to get more priceflexibility.

In Illinois, the state now allows employers, TPAs and insurersto use accepted medical networks to treat injured workers. Such networks help control claim costs by producing better outcomescost-effectively.

Prior to the recent law, the state did not have a workerscompensation fee schedule. All medical costs were charged at“usual and customary” levels, which tend to be higher than througha workers compensation medical network.