Claims Technology: An Ace in the Hole in the Retention Game
Of the many issues that concern today’s claims adjusters, employee retention tops the list.
A recent survey by Risk & Compliance revealed that employee retention, especially for claims adjusters, remains an ongoing issue in 2023. Factors ranging from post-pandemic job switching, current economic conditions, and legacy technology all play a role. Whatever the reasons, they’ve significantly impacted carriers’ claims administration capabilities. Once upon a time, seasoned adjusters handled the same claim from FROI through case management until the employee returned to work. Today, claims adjusters are expected to jump into the claims process at any point and provide seamless and effective case management. That’s a tall order for a relatively inexperienced adjuster.
The Adjusters’ Dilemma
Adjusters play a central role in advocating for employees, while acting as financial stewards to control claims expenses. Day to day tasks include:
- Reviewing the details of the claim, including medical records, police reports, to determine the claim’s validity.
- Determining the value of the claim by using a variety of factors, including medical expenses and lost wages, to calculate how much a claim should be paid.
- Negotiating with claimants and their representatives and communicating with other internal and external stakeholders.
Highly skilled adjusters bring a strong understanding of workers’ compensation laws and regulations which vary across states. More experienced adjusters possess high-level process knowledge, enabling them to route the right claims information to the right person, saving time and optimizing resources.
Today’s adjusters are often working with multiple disparate systems that don’t talk to each other or share data. Outdated legacy systems are frustratingly inefficient, inflexible, and lack intuitive interfaces, often resulting in frequent adjuster turnover.
Furthermore, prospects for attracting new adjusters are low. The US Bureau of Labor Statistics reports that overall employment for claims adjusters is projected to decline 6% from 2021 to 2031. Despite declining employment, about 23,200 openings for adjuster positions are projected each year due to the need to replace workers who leave the industry or retire.
Carriers are addressing this need aggressively with better training, career planning, and greater flexibility through remote work (which can add significant costs to support communications, data sharing, and security). But there is still inflationary pressure to raise salaries or risk losing valuable, highly trained adjusters to competitors.
The reality is that carriers need to prepare for a world with fewer claims adjusters, and most likely a different mix of adjusters who lack the experience of their departing colleagues.
Claims Technology Solutions
Technology has always played a critical role in supporting Workers’ Compensation systems and will need to continuously evolve with streamlined workflows, enabling the same amount of work to be completed with fewer adjusters. To make this happen, insurers need to maximize automation, optimize workflows, and minimize adjuster touchpoints where automation is not an option. By adopting the “less is more” approach, carriers can achieve greater productivity. It begins by configuring Workers’ Compensation systems to handle most claims automatically with straight through processing (STP) to limit adjuster involvement, and shift higher-value work to a smaller group of adjusters who possess the right skill set. With increased automation, adjusters can focus on more complex claims and develop their skills more quickly. This reduces workload and helps entry-level adjusters build greater confidence, which can improve job satisfaction and reduce turnover.
Relatively simple, medical-only claims can be completed with automation alone. More complex claims can be addressed more easily by adjusters by integrating sources like ODG for more effective treatments within the financial guidelines of the carrier’s program. Enabled adjusters deliver faster responses and better outcomes through more effective case management.
The growing use of AI and machine learning has opened new avenues for carriers to drive automation more deeply into their core processes. Analysis of claims data over time has yielded risk scores that can accurately predict claims expenses and optimal treatment options. Access to these capabilities allows adjusters to create more effective return to work plans while minimizing financial risk, all in real-time.
Technology is also improving retention rates among employees by providing a more collaborative and engaging work environment. We’ve often seen Workers’ Compensation insurers invest in communication and collaboration tools to foster an improved work culture. Better communication helps employees feel more connected to their colleagues, customers, and the company overall, leading to increased job satisfaction and decreased turnover. Retention is also boosted via automation with more engaging digital experiences and effective workflows that optimize adjusters’ skills.
The Final Word
As more Workers’ Compensation carriers begin their transformation to a modern core system, it’s important to understand how technology can support changing job roles. Across the board, multi-lines, monolines, and State Funds have retention high on their list of objectives. With this in mind, it’s a good time to consider how advanced claims technology can not only affect change, but also enhance adjuster retention in your own organization.
To learn more about Sapiens Workers’ Compensation solutions, click here.