The Client and Its Challenge
This community healthcare organization wanted to know how its workers' compensation performance compared to industry peers. Additionally, the client wanted to determine whether current pre- and post-loss processes were effective in controlling costs.

The Risk Consulting Solution
Marsh was retained to complete a Workers' Compensation Gap Analysis, perform a claims reserve review, and conduct subsequent negotiations with the client's insurance carrier to lower outstanding workers' compensation claims reserves. The Gap Analysis was comprised of two parts: a financial Gap Analysis that compared accident statistics to industry peers and a process Gap Analysis that evaluated existing workers' compensation pre- and post-loss policies and procedures.

To complete the financial Gap Analysis, Workforce Strategy consultants reviewed the client's workers' compensation claims performance over a four-year period. Findings were benchmarked against industry peers using Marsh's Dimensions™ database—a data warehouse of workers' compensation claims information from insurance companies, state funds, and third-party administrators.

Concurrently, Marsh consultants conducted a thorough review of the client's systems and processes for preventing and mitigating the costs associated with workers' compensation cases. While spending time on-site with the client, consultants conducted interviews with key stakeholders from a range of job functions, observed the workplace, and completed a thorough review of existing workers' compensation cost-containment policies and procedures. Data collected during the site visit was compared to industry best practices in forty pre- and post-loss categories.

In addition to the Workers' Compensation Gap Analysis, Marsh led a claims reserve review meeting with the client's insurance carrier. Select workers' compensation cases were reviewed for reserve adequacy. Where appropriate, the consulting team negotiated reserve reductions with the carrier's claims department.

Results
Marsh consultants presented a report to the client's senior management team with the results of the Workers' Compensation Gap Analysis. While claims costs were in line with industry averages, the client's safety program was identified as a key area for improvement. Results from the analysis were used to identify and prioritize next steps. Marsh also successfully negotiated more than a 10 percent decrease in the client workers' compensation reserves.