BrowardCounty is the second-most-populous county in Florida, the 18thin the U.S. and home to 31 municipalities including FortLauderdale.

Among its myriad responsibilities are an extensivetransportation system, with more than 300 transit buses; BrowardCounty's Port Everglades (the world's second-busiest cruise portand South Florida's primary bulk cargo depot); and Broward's FortLauderdale-Hollywood International Airport. Like many sizablepublic-sector entities, its spectrum of exposures is vast and itsrisk considerations broad. If not managed effectively, its workers'compensation costs for personnel ranging from bus operators toelectricians, plumbers, street cleaners, gardeners and a host ofother blue-collar—and white-collar—professionals could easilyballoon out of control.

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So when John Burkholder, director of Broward's Risk ManagementDivision, took over in June 2012 and brought Workers' CompensationClaims Manager Jeff O'Connor on board three months later, they hadtheir work cut out for them. Although the county's risk managementdivision would no longer be responsible for its police department(the largest fully accredited sheriff's office in the country)effective that October, it was still looking at 668 open workers'comp claims.

What do you do, when an entire county's workers' comp programneeds to be reined in and redefined? Broward County's answer was toestablish appropriate metrics to discover the greatest areas ofcost, prioritize them and approach them strategically.

“You have to know where you are, to know where you want to go,”says Burkholder. “Once you start looking at these numbers, you knowwhat the right thing is to do.”

Broward's risk management squad began to aggressively addressits costs and efficiencies. The workers' compensation staff wouldbe placed into teams and held to higher standards according to bestpractices. One revelation was that the county was spending a fixedmonthly cost of about $37,000 to vendors for such services as nursecase management, vocational rehabilitation, recorded interviews andinitial investigations.

These functions were brought in-house; by having its own staffperform these tasks, the county's adjusters also achieved greatercontrol over its claims as well as increased efficiency andimproved savings. Since this change was implemented, the countyestimates that it has saved taxpayers $812,400.

Medical costs cut

As with many organizations, Broward Countyalso experienced high medical costs on its claims. Florida permitsdoctors to dispense prescriptions from their office, which—asworkers' comp professionals will tell you with a groan—can lead topharmacy billing companies charging top dollar.

An outside company was brought in to review treatment on eachopen case, and less expensive alternative drugs were found for mostof the medications being prescribed. Next, a nurse was enlisted tobriefly meet with the treating doctors to discuss treatmentprotocols. The vast majority of those reviews went very well, saysO'Connor, and the doctors agreed to proceed with new regimens.

The county self-insures, and self-administers its claims with amedical management vendor performing the initial intake, routingclaimants to its network of medical providers as well as performingthe county's medical bill reviews. Prescriptions are handled by apharmacy benefit manager, a preferred provider under the medicalmanagement vendor contract. Medications billed through the pharmacybenefit manager provide additional savings.

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Broward County was able to achieve a cumulative pharmacy savingsof $4,519,115 (fiscal year 2013, 2014, and thus far in 2015) bycontrolling its medical providers and the medicines theyprescribed. The average monthly medical cost dropped from $802,999in Q1of fiscal year 2012 to $160,068 in Q1 2015; the county's goalis to further reduce that figure to $100K per month in the next sixmonths.

Settled cases equals savings

Pharmacy costs were just one piece of the pie; O'Connor andBurkholder had inherited many cases that needed settling in theshort term in order to get a handle on long-term expenditures. Thecounty aggressively sought to close and settle as many of the 668open claims as possible. This was accomplished by working withcounty administration and county commissioners to approve thesesettlements.

Some claims were able to be closed administratively, but ofthose that required a formal settlement the county has saved$7,576,391 (fiscal years 2013, 2014 and 2015, as of May 31) basedon the difference between the settlement amount and the expectedlifetime costs of those claims. As of June 30, 2015, 226 claimsthat came in between Oct. 1, 2014, through June 30, 2015 have beenclosed. The average cost per claim was $1,663.13. The previousyear, 423 claims were closed at an average cost of $2,552.

Today, its inventory is down to about 250 claims, the majorityof which are new cases. “An enormous amount of our savings camewith the settlement of our cases,” says O'Connor.

Broward County currently resolves 95% of its incoming claimswithout the need for a formal settlement.

Continued vigilance

As important as it is to resolve claims quickly, says O'Connor,it's even more important to prevent new ones. Numerous divisionsare involved when an employee is injured at work. Communicationshave vastly improved among county divisions to ensure the promptdelivery of employee benefits and protections.

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For example, a process review revealed that the county wasoffering injured workers up to 320 hours (eight weeks) ofdisability leave for each injury. Adjusters were often unable toproperly assign the correct “bucket” of those hours to the rightinjury when the employee had multiple claims. “That policy wasdiscouraging employees to return to work,” says O'Connor. Thatchanged, with the help of the eight unions that represent 84% ofthe county's employees. Union agreements were renegotiated.

The county eliminated that policy and put into place a betterway to link injuries to time used, preventing an employee fromreceiving more hours than were appropriate. Additionally, employeescan use accrued leave to supplement their existing workers' comptime.

Currently, the county's Safety & Occupational Health(S&OH) and Claims sections analyze and review each claim aswell as the overall frequency (incident rates), severity andtypes/causes of claims coming from every division and coveredagency. S&OH performs inspections and audits, provides trainingbased on its findings, and publishes a countywide safety manualthat is continually updated based on claim experience and itsongoing findings.

As part of the onboarding process all employees are acquaintedwith the safety manual, which contains training specific to eachunit and contains a full catalog of safety training for everyemployee in various agencies—from general practice procedures tospecific policies on asbestos, blood-borne pathogens, aerial work,compressed gas management, respiratory protection and industrialhygiene.

Workers are expected and encouraged to return to work onmodified duty whenever possible. An “Essential Functions Listing”document is sent to the worker's immediate supervisor, and must bereturned in 24 hours. For example, if a carpenter who works in thecounty's parks division is injured, adjusters can ascertain thatemployee's essential functions. That document is immediatelyforwarded to the physician to see if the injured worker is able togo back full time. If not, an altered-duty situation is found, withrestrictions.

O'Connor sees only advantages to the county self-administeringand self-insuring its workers' comp program. “We have BrowardCounty employees servicing Broward County injured workers,” hesays. “Knowing and having a heightened understanding of the variousjob descriptions and essential job functions allows our adjustersto accurately communicate with treating physicians and countyagencies, which also promotes a quick return to work.”

Controlling the dollars spent on claims is another big advantageof self-funding/self-administering claims, he adds: “As with anyorganization, we have to operate within a budget. If somethingisn't working we can take another approach. We are properlystaffed, and continually prove our value.”

Award Acceptance

In accepting the award, O'Connor offered the followingremarks:

Broward County very much appreciates National Underwriter'srecognition of our risk management program.

We would like to congratulate the other winners, Kathy Hawkinsonof Cedar Fair Entertainment and Patti Colwell of SouthwestAirlines.

We are encouraged to see these large organizations proactivelyproviding safety training during the onboarding process, educatingtheir treating physicians on the essential job functions of theirvast array of job descriptions and continuously communicating withthe numerous players involved in the daily administration of theirworkers' compensation claims, as we have done.

The Broward County risk management division along with itscounty partners, guided by its department, county administration,and the Board of County Commissioners remain focused on the goal ofdelivering cost effective and collaborative services to enhance andpromote the quality of life for our residents, businesses, visitorsand coworkers.

We have made great progress over the last three years. Theannual dollars spent have been drastically reduced. Our injuredworkers are better educated on the mechanics of the program andeven assist with keeping costs down. Communication between agencieshas greatly improved expediting the injured workers return to bothlight- and full-duty work.

I would like to especially thank our adjuster and assistantteams for their persistent efforts to yield our current results.The entire Risk Management Division pitched in to assist us, as didour partners in Human Resources, the Office of IntergovernmentalAffairs & Professional Standards, and the County Attorney'sOffice. None of this would have been possible, however, without thesupport of our CFO, County Administration and our Commissioners whoall encouraged and supported our efforts leading to thesetremendous results. Our leadership understood and really stepped upto benefit the taxpayers and county employees.

Much work remains, but proven processes are now in place and thenumerous contributors have become more educated with thoseprocesses. I enthusiastically look forward to assisting BrowardCounty in its future by continuing our SUNsational Service whileensuring Broward County taxpayers receive the most cost-effectiveprogram possible.

O'Connor and fellowwinners Patti Colwell and Kathy Hawkinson accept theNational Underwriter Award for Excellence in Workers' CompensationRisk Management from Shawn Moynihan, editor-in-chief, and JohnMoore, publisher of NU-PC at the 70th annual Workers' CompensationEducational Conference in Orlando, Fla.

Editor's Note: An earlierversion of this story published on Aug. 12, 2015.