The Importance of Managing STD Claims
As I go around the industry, meeting many talented and experienced people who are involved in managing disability claims operations, I receive an overwhelmingly positive reception to the concept of segmenting STD claims. However, making changes to the process seems challenging.
The majority of LTD claims have STD claim history behind them, and probably with the same insurer.
Surely as soon as we suspect that an STD claim is heading for the long term, we should treat it like an LTD claim, and do everything we can, as soon as we can, to help that employee get back to work before the claim gets complex.
Yet only one company in my travels actually has this process in place.
And whether you use a predictive model to select the STD claims that are likely to transition to LTD or even if you use ‘experience’, these claims should be pulled out on a separate track.
- “We get too many claims”
- “STD is transactional”
- “We have no time to think” (reference Mark Taylor’s article)
Clearly we have to help the STD team make time to think.
We need to define criteria for STD Claim Segmentation, with the use of a fast lane for simple claims saving time to spend on the complex claims, the ones that could become really expensive for everyone!
The fast lane is for maternity claims (in the US at least), injury claims, hernias, digestive system issues, and other diagnoses with quick resolution (I can give you the list). These are claims that typically have durations inside 70 days, and have a very low likelihood of transitioning. So we should pay-&-close these claims or an auto-adjudicate them if you can, but get them away from the Claim Managers. These claims can amount to 25%-30% in volume, so claim managers will save a significant amount of time by not working on these claims.
This will make it possible to spend more time on the complex claims. Some of these are easy to identify, and others may need the help of analytics to identify more subtle drivers of duration. It is on these claims that claim managers should spend their time, and spend their rehab budget, before it’s too late.
Making these process changes is hard when everyone is working ‘flat-out’ already, and any enhancements to the systems will make this change even harder.
We can help you work through these challenges, with the analytics, the process and the technology, and implement a segmentation pilot to help demonstrate the benefits of this approach.
The Claim Lab – Email us at info@claimlab.org