What is cost relief? Can you lower our premiums? How does Blue Collar charge? Employers have questions, and in this installment, we provide the answers.
What can we expect from Blue Collar Consulting?
Blue Collar Consulting (BCC) is obligated to provide courteous, thorough, and prompt service to its clients. Clients of BCC should expect service delivery that is competent, timely, diligent, and efficient. BCC applies its relevant knowledge and skills in a manner appropriate to each matter undertaken on behalf of a client, including:
a) knowing general workers’ compensation board (WCB) legislation, policy, and procedures, as well as those areas of administrative law that pertain to workers’ compensation
b) investigating facts, identifying issues, ascertaining client objectives, considering possible options, and developing and advising the client on appropriate courses of action
c) implementing, as each matter requires, the chosen course of action through the application of appropriate actions, including:
- procedural analysis;
- policy and legal research;
- application of the workers’ compensation act (WCA), WCB policy, and human rights legislation to the relevant facts;
- writing and drafting;
- negotiation/advocacy with WCB case managers, the DRDRB, and Appeals Commission
- problem-solving and communicating in a timely and effective manner
The advisory we provide shouldn’t be construed as legal advice. We’re a risk management consultancy that specializes in workers’ compensation. Our consultants aren’t WCB lawyers, but rather, are experts in the niche of WCB risk management. That said, we do have a wealth of knowledge when it comes to WCB legislation and the decisions made by the Appeals Commission, which is an administrative tribunal.
What type of contract would be in place for the provision of services? Would it be project based or ongoing commitment?
The terms, scope, and duration of any potential service agreement are customizable. For piecework projects, a fee-for-service arrangement is available. Or where a longer-term, value-based relationship is sought, BCC offers a subscription program that offers package discounts a lower per unit cost.
Which WCB claims will be reviewed?
WCB offers cost relief for employers when an injury or illness results in a prolonged recovery time due to a pre-existing condition. This means that if an employee’s recovery time is prolonged beyond what it would have been without the pre-existing condition, the employer may be eligible for cost relief. To be eligible for cost relief, the employer must provide evidence that the pre-existing condition has prolonged the recovery time and that it is unrelated to the work-related injury or illness. And therefore, to efficiently rank-order (aka triage) claims for historical review, we prioritize those claims where pre-existing conditions have (or are suspected to have) driven cost escalation.
It should be noted, however, that employers who participate in an Industry Custom Pricing (ICP) program are not eligible for cost relief on the basis of pre-existing conditions. However, fortunately for ICP members, WCB still grants cost relief for claims costs driven by concurrent conditions where it can be demonstrated that a concurrent condition has prolonged the recovery time beyond what it would have otherwise been.
Lastly, an efficient analysis always filters for date of accident (DOA) and dollar value. This is because the window of opportunity for claiming cost relief or recovery is subject to time limitations. Likewise, in effort to maximize bang-for-the-buck, BCC seeks out the most expensive claims first and foremost. This is done in effort to optimize the potential cost/benefit ratio (or risk/reward) of pursuing an historical analysis. To employ a ‘crude’ metaphor, historical analysis is something akin to exploration and production in the oil and gas industry. Some efforts will result in dry holes, while others will generate tremendous ROI, and yet the fixed cost of drilling both wells (all things being equal) is approximately the same. Therefore, in relation to the context of historical analysis, we drill into the claims that offer the greatest potential ROI i.e., those that represent the greatest payback (return) with the least possible effort (time inputs).
How is confidential information protected?
BCC values the privacy of personal information and takes the protection of sensitive data very seriously. We understand the importance of keeping information confidential and secure while complying with Alberta’s privacy laws. We never sell or share personal information with any third party for any reason. Furthermore, data is stored in Google Drive (Enterprise), which uses 256-bit SSL/TLS encryption for files in transit and 128-bit AES keys for files at rest. This means that personal information is protected by the highest level of encryption available, ensuring that it’s secure from unauthorized access or theft. Lastly, BCC is more than willing to enter into an NDA or confidentiality agreement.
What level of system access would be required to perform historical reviews?
BCC would not require access to your company data systems to conduct historical analysis. In cases where clients engage Blue Collar for the purposes of disability management, then higher level HR access is at times required. To conduct the historical analysis, BCC would require General User status on your myWCB online portal. This basic level of authorization would permit BCC’s access to reports and other information necessary to conducting claim analysis.
What percentage of reviewed claims might be expected to generate cost relief?
Unfortunately, there’s no simple answer to this question. In BCC’s experience, approximately 30-40% of claims offer copious opportunities for substantive cost relief or removal. And in a majority of cases, the robust premium relief that flows from the 30-40% profitably offsets the cost of analyzing the 60-70% that fail to reveal meaningful opportunities.
Do you offer case management services to prevent WCB claims from spiraling?
Prevention is worth a pound of cure. Historical analysis is very worthwhile, and yet it’s reactive exercise. It’s better to mitigate the costs before they happen, and BCC specializes in on-demand, real-time advisory and case management that prevents runaway claims costs from spiraling out of control. This service is separate from historical analysis and is known as strategic case management.
Turnaround time on historical reviews?
Every claim is different. Some claim files are 500 pages in length and span a year or two, while others might contain 2,000 pages or more of highly dense medical information and case management details. Some injuries are simple (e.g. sprained ankle) while others are complex in the extreme (e.g. traumatic brain injuries, psych, long-COVID). The time- scaling associated with each claim would hinge on the dollar value, density of detail, complexity of the injury, and the stakes i.e., implications for your company. For a frame of reference, claim files must be meticulously parsed to unearth often subtle and discrete (yet highly potent) opportunities for cost relief. The average claim file review runs 4-6 hours in length. Any attempt to condense, accelerate, or shortcut this timeline often results in overlooked opportunities.
How are the costs for the service billed? (e.g., hourly charge, project charge, contingency fee)
BCC bills its services at an hourly rate of $200 for fee-for-service arrangements. Subscription arrangements are available at a lower hourly rate, but they require minimum monthly charges, which vary depending on the anticipated service demands. However, BCC does not charge on a contingency basis.
It’s important to understand that there isn’t a direct correlation between claims costs and premium relief. For example, let’s say BCC reduces your claims costs by $500,000. This could roughly translate into annual premium relief ranging from $150,000 to $250,000. In this situation, you might pay BCC around $50,000 to achieve these savings.
On the other hand, if you were to enter a contingency arrangement with BCC and we still manage to relieve the same $500,000 in claims costs, the premium relief would remain in the range of $150,000 to $250,000 per year. However, in this scenario, you might owe BCC a customary 25% portion of the awarded cost relief (in this case, amounting to $125,000). As a result, the realized premium discount would be significantly offset by BCC’s portion.
While contingency arrangements may initially appear attractive, especially when an analysis for cost relief is unsuccessful, they can ultimately diminish the value for the client. This is because contingency fees often consume a significant portion of the savings generated by successful historical analyses.