In this episode, ADJUSTED welcomes Julie Greer, Senior Catastrophic Resolution Specialist with Berkley Industrial Comp. Julie discusses some general best practices of reserving claims and the possible effects of poor claim reserving.
Season 4 is brought to you by Berkley Industrial Comp. This episode is hosted by Greg Hamlin and guest co-host Matt Yehling, Directory of Claims at Midwest Employers Casualty.
Comments and Feedback? Let us know at: https://www.surveymonkey.com/r/F5GCHWH
Visit the Berkley Industrial Comp blog for more!
Got questions? Send them to marketing@berkindcomp.com
For music inquiries, contact Cameron Runyan at camrunyan9@gmail.com
In this episode, ADJUSTED welcomes Julie Greer, Senior Catastrophic Resolution Specialist with Berkley Industrial Comp. Julie discusses some general best practices of reserving claims and the possible effects of poor claim reserving.
Season 4 is brought to you by Berkley Industrial Comp. This episode is hosted by Greg Hamlin and guest co-host Matt Yehling, Directory of Claims at Midwest Employers Casualty.
Comments and Feedback? Let us know at: https://www.surveymonkey.com/r/F5GCHWH
Visit the Berkley Industrial Comp blog for more!
Got questions? Send them to marketing@berkindcomp.com
For music inquiries, contact Cameron Runyan at camrunyan9@gmail.com
Hello, everybody and welcome to adjusted. I'm your host Greg Hamlin coming at you from beautiful Birmingham, Alabama where it is finally starting to get cold. But I guess having grown up in the Midwest, we wouldn't call it cold. And then with me today is my co host, Matt, ailing Matt, if you want to introduce yourself.
Matthew Yehling:Good. Good morning, everyone. This is Matthew Yaling. With Midwest employers casualty and I'm coming from the banks of the mighty Mississippi up in St. Louis, Missouri.
Greg Hamlin:You guys are gonna get snow anytime soon here, Matt.
Matthew Yehling:Well, we had some over the weekend, actually. So but it stuck around for about 30 minutes, and then it's gone. So I like it when it does that, personally.
Greg Hamlin:Yeah, well, I still got a couple snow shovels in my garage that are just like relics. Since we don't really see that down in Birmingham. I think we've had two testings in four years, and both were gone within two hours. So
Matthew Yehling:I guess that kids have seen it, but I bet it's shut down everything. Yeah. Oh, yeah.
Greg Hamlin:There's nothing happening. If that happens. The world world ends so well. With us today, we've got a special guest, Julie Greer, who's our senior catastrophic resolution specialist for Berkley industrial calm. So we're glad to have her with us, Julie, if you could say hello to everybody.
Julie Greer:Hello, everybody sitting. Everybody's talking about where they're from. And I sit here down in the great state of Texas, where typically it's very hot. But I've actually we've had actually had some freezing weather here over the last week, and I'm already over it. So ready for the warm weather again.
Greg Hamlin:Now you're in the Dallas area, Dallas, Fort Worth area. Is that right?
Julie Greer:Correct. Just north of Dallas, in the McKinney area, which is considered North Texas suburb of Dallas.
Greg Hamlin:Excellent. Well, we're glad to have Julie with us. We're also glad to have her as a member of our team, Julie brings a lot of experience. For those who don't know, Berkeley industrial comp is focused on high hazard workers compensation insurance, which means we see very difficult injuries on a fairly regular basis, although we don't have a lot of frequency in our losses. And so Julie is part of our catastrophic team that helps us manage those challenging claims and has a lot of experience. So we're we're very fortunate to have her with us. The topic of the day is reserving claims reserving and we were actually chatting a little bit before the started. This is probably one of those claims one on one topics that we haven't covered nearly two years of doing adjusted. So we felt like it was time. So Julie's going to be our expert on that today. Because I think Matt and I are too far removed now to consider ourselves experts at reserving. I don't know about you, Matt, but that's where I'm at.
Matthew Yehling:But I do want to add my own disclaimer of everyone, every company right reserves a little differently. So anything we say or comment on does not you know, we're not giving away that the secret sauce here or but I think there's some common best practices in the work comp industry that we're going to comment on, on reserving but you know, from an excess carrier at Midwest hecklers is excess work comp care. I see the reserves on a lot of third party administrators, a lot of our other insurance entities, entities and that kind of partner. So I see a lot of different reserved philosophies and different styles of reserving. So always interesting. And that's why I was telling Greg earlier, like, I'm, I'm curious to see how this discussion pans out. It'll be interesting. No, I'm
Greg Hamlin:glad to have you. I think your perspective will be interesting, having seen so many different styles. And I think we've all worked actually in this group for different carriers. So we've all seen different ways of doing that. And so it should be a pretty interesting discussion. I know for myself, I've been joking, we have a couple team members that moved on to new positions. And so we're hiring. And in that process, I've been helping out with some claims tasks. Again, I'm a big Marvel fan. And I kind of feel like fat Thor right now. Like I can wield me on there, but it's just not like how I used to. So I'm glad that we have somebody who's in the trenches that can talk about this topic. I definitely have my own thoughts, and we'll be sharing them. But I think Julie's gonna do a fantastic job today. I thought we'd start Julie by you just telling us a little bit how you ended up in claims. We always like to start with this question. And I'm sure when you were young, this was your dream job to be in insurance as a claims person. So tell us how did it happen?
Julie Greer:Well, like so many. It was quite by accident. I was just at a school and I started looking for work and I absolutely had no idea what I wanted to do. So I applied for a front desk job it would turn out to be an insurance company. And the claim manager came out and brought me back to our office and said Did you know she had noticed that I had been to college and wanted to know if I'd be interested in being a claims adjuster, so and I remember telling her, I had no idea what that was, or whether I was qualified. And she just smiled. And I think back, it's probably an evil smile and said, Don't worry, you'll get the hang of it. And next thing I knew, I was given a book of rules and regulations for the jurisdiction 200 Plus files and assistant to help with, you know, the payments and state form filing, I didn't even know, you know, I didn't know the difference between a defense attorney, a plaintiff attorney, and I distinctly remember asking the first attorney that call me if he was a good guy or a bad guy. So I mean, I, I am horrified thinking back what he must have thought and kind of laughed and said, I'm the bad guy. And you take this to your supervisor. And so from there, you know, it was a truly a baptism of fire, and, you know, to do the claim world of insurance. But in about six months, I was already licensed, and I was really good at what I was doing. And I found it really loved the challenges of handling, you know, every aspect of the claim. And, you know, eventually I went on to handle both work comp and liability claims, which, you know, has really served me well over my career in the insurance industry.
Greg Hamlin:That's awesome, Julie.
Matthew Yehling:All right. Thanks for sharing that. So when we talk about reserving, you know, we can probably vacillate on just what that means. But the start at the beginning, you know, what is a reserve from a claims perspective?
Julie Greer:Well, you know, in the simplest sense, I mean, the term it's, it's the amount of money you set aside to cover the legal and financial obligations that are arising out of a claim. And it's much more complex. And obviously, I mean, we've got Sarbanes Oxley and other regulations that require insurers to accurately account for their liabilities, you know, insurers are subject to, you know, to quarterly and annually recording, as well as audits. And if there's an indication of reserving issues, you know, these will need to be satisfactorily addressed. And if we're insured to continue to do business in a state, you need to have accurate reserving. And the key is, you know, the key word is accurately, you know, some from a claims process perspective, it's, you know, it's often a challenge, you know, all the information that's needed is not necessarily available, when that claim comes in, you know, there's uncertainty, what's the extent of the injuries, you know, medical care? What's that gonna look like, over time is a return to work possibility with our customer, you know, can they accommodate the return to work, and all this can be difficult to predict. And, you know, depending on the reserving protocols or best practices of the insurer, you know, initial reserves might be based on, you know, with a call statistical reserve, so every new lock that comes in the door is automatically going to be assigned the same reserve. The second approach is literally at best guesstimate. And that's to allow for benefits to be paid. You know, while the necessary information is gathered, and reserves can be more accurately established. You know, once you get that sufficient information, it's at that point that you're going to do your detailed evaluation, which is necessary to ensure again, that we have appropriate funds that are being set aside to cover the anticipated future costs of that claim. You know, once that claim is established, that focus then shifts to monitoring the accuracy of the reserve as new information becomes available. And I think that piece is critical. I mean, once you get the reserves set, you can't just let it go. You need to be looking for those changes in condition, you know, what was oversight, or maybe is a simple back clean, coming in the door now, for instance, is now progressing to surgical intervention. Conversely, though, you know, what we thought was a severe injury is not as significant. So we might look to lower reserve to more accurately reflect the exposure from what was initially determined.
Greg Hamlin:I think those are great points, Julian, you know, for me, I think about it a lot. Like, if you were going to go on vacation, and you had some more fun, I'm gonna make it something more fun than somebody getting hurt. But, you know, you have to plan out well, what's it gonna cost? What are the plane tickets going to be? What is it going to cost? To do the activities? is an all inclusive resort? Or do I need to be paying for all the activities we do? And then when you get there, you find out that some of the things you plan for either are less or more than what you thought, we find out that food was way cheaper than you thought or way more expensive. And you have to reassess your budget right and make some choices on Okay, well, what does this look like and claims that's really at a high level what we're doing, but we're doing it with the knowledge that we have that changes, and I thought you did a nice job of highlighting that. I know talking to our actuary, one of the things that would give him the most pain is if we are not being consistent on how we evaluate reserves. Because and Matt hinted at this, working with different TPAs different companies. Everybody might have a slightly different way to go about reserving their claims. But if they're doing it exactly the same way, then it makes it easy to anticipate, you know what could be out there from your perspective Why is having a reserve philosophy within your company? That's consistent important. Julian, you've worked a few places as well.
Julie Greer:Yeah, and I mean, one thing everybody looks at as the overall outcome, you know, making sure that we're reserved for that, that ultimate outcome. But, you know, I kind of look at the reserve philosophy as a roadmap of sorts. It provides what you were talking about that more consistent approach, you know, when we're when and how reserves are calculated, you know, it's also an insurance best practice that will ensure compliance from a regulatory standpoint. And I think what's important for an adjuster in following these established guidelines, with this reserving flush philosophy, it's going to ensure that consistency, like you said, across all claims, and that's a critical piece of it, along with the adherence to best practices. And since we're, you know, the insurance industry is such a heavily regulated industry, how well we manage our claims from a fiduciary standpoint can either have positive or negative long term impacts on the ability to do business. And part of the auditing process is reviewing whether or not adjusters are following the best practices operating within their specific authority and adhering to the insurance stated reserving philosophy, whatever that might be.
Matthew Yehling:I appreciate that summary. And I like Greg, reference to actuarial bucket over in Africa is this consistent with our reserving philosophy, it reminds me of a, you know, going golfing with, with actuarial, I don't know if you've ever you know, golf, or golf with actuarial but one, one actuary will line up, hit the ball dead to the right. The other one lines up, it's a bed to the left, they look at each other and say, perfect.
Greg Hamlin:That's exactly it. And I think you know, what I've learned from from them is they have a lot of pressure on them, because they're basically being asked to be fortune tellers, they're being asked to look into the past and predict the future. And if our past is inconsistent, they're gonna have a hard time even getting in the ballpark of what's going to happen. So being consistent in that philosophy, whatever that philosophy is, within your company, I think that's really important. You know, one of the things we hear about is under reserving, I'm sure, Matt has an opinion on this being an excess carrier. You know, they don't like surprises, either. But Julie, what are your thoughts on the impacts of under reserving?
Unknown:So so, you know, as As mentioned previously, you know, that reserving is setting aside that money, you know, to cover and insurance, financial obligations. And I here's the part that gets complicated is, it's not, you know, like you've mentioned is personally, I'm not setting aside $50 to do X, we here and now you got to do the here and now on the on the reserve on a claim file, but you've also got to project into the future, which is really difficult to do, you know, and we always joke about having crystal balls and, you know, voodoo magic and all that other things, you know, to predict something, we don't really know what's going to happen, but we have to be as good as we possibly can in order to make sure there are sufficient funds out there on these claim files and make claim payments when they need to be made. So under reserving has a number of negative downstream impacts. And, and this is where, you know, actuary you know, they're under the gun constantly to make sure that we're doing what we need to be doing on the frontline. If an insurer is unable to meet its financial obligations, it's going to impact the financial stability. And one of the things that leads to is a downgrade in financial stability and rating from firms such as ambass. So you see an insurance company that's a rated A plus rated A plus plus rated, you know, that's what you strive for, as a financial institution, you want to be rated highly. And if you're downgraded then the stability of rating, it's going to result in fewer potential buyers of the insurance product, ultimately running the risk of insolvency and you know, as a customer, would you rather be with an A plus plus rated company, and even as an adjuster, I want to work for a company that's highly rated. And this is usually a good indicator the company is well managed from a financial aspect. The other impact is on future premiums. The reserves on open claims are part of the calculations an underwriter uses in establishing the loss experience of the company. So if the loss experience is understated, because the reserves are insufficient, the insurer will be charging an inadequate premium, which is going to result in lower profits and again, potentially pushing the company to insolvency.
Greg Hamlin:I think you hit on it perfectly there. And I won't go into all the details. But I've worked for places that have been on both sides of that fence and there's nothing more stressful than when your am best rating as either, you know, changed or the outlook has changed. That creates a lot of pressure and stress within a company. And you're right people want to work for places where they know that they don't need to worry about those things. Man I'm curious from your perspective, you know, you mentioned this as an excess care what keeps you up at night when there's undeserving by somebody that you're doing business with,
Matthew Yehling:but I'm quite honestly so it's it's a excess level claim we do You know, look at the TPAs reserves, but we have enough statistical data that we primarily will ignore the the underlying reserve on the account, you know, for having a claim open and we're tracking it ourselves, we we set our own independent reserve. And from an access perspective, we're doing that independent because this goes back to its previous conversation TPAs. And carriers are set up for frequency claims, and they're not generally set up for the big bad ugly claims that make up 100% of an excess carriers caseload. So, so we set our reserves independent of whatever the TPA or whatever the underlying carrier self administered, partners reserves would be. So it's a little different, you know, in each TPA, you know, I can tell you reserves differently. And we've seen different, you know, different best practices and I get to, I get to see a lot of those best practices, the philosophies are generally very similar, but you can definitely see different trends in different places and in, you know, reserving to tough topic because in some states, you know, you're reserving totally different because, and we're going to get into some of these examples. But you know, like, in this part of the state, you know, our carpal tunnel claim is worth this, if I go 300 miles north of St. Louis, that carpal tunnel claim is maybe twice as expensive, you know, in Chicago, Illinois, versus what it would be in Carbondale or Carbondale, Illinois. So, I mean, that's fine that 300 miles, but the point is, you know, there's, you have to know, where you are, what the circumstances of the claims are. And we always joke, you know, that joke, but, you know, reserving is more of a soft science, right. It's not always hard and fast rules. And then we talk a little bit about like stair stepping and an amusing question for for Julie is, you know, where do you see stair stepping? And you talked a little bit about and I mentioned that even to like the dynamics of a claim changing? Like, what's the difference between like, recognizing the changing dynamics, or something's changed in this claim? That's an accepted claim, versus stair stepping, like, maybe, can you talk to both of those points that because I see this all day, where the condition worsened. But, you know, stair stepping, I think is a totally different thing than Hey, there's a worsening of the condition some?
Unknown:Yeah, well, it's stair stepping, I look at stair stepping as kin to the under reserving and not to sound hokey, but it's kind of like the step sister of under reserving, you know, the small incremental increases to cover just enough of what needs to be paid at any given time. And it's just as detrimental as under reserving, you know, in effect, you know, it is under reserving. I mean, and I think this can be symptomatic, perhaps of an adjuster not understanding the context of the claim, or not utilizing resources to accurately assess the exposure over an appropriate period of time. So you're in the file. And you know, they're going in for surgery. And you only have, you know, few weeks of indemnity, so they pop up a little bit of indemnity, and they have to pay for, you know, they say, oh, surgery, so they put that in, but then they don't think beyond like, there might be physical therapy, maybe now I need to assign a nurse case manager, I haven't seen any bills come in, and I'm already down. And we have, you know, X number of dollars left and medical, perhaps my original assessment wasn't accurate at all. But they never take the time to actually look at where the case is, look at the medical reports, and then look at the prognosis and look at what the treatment plan might be, to project out accurately. And you know, I had just reserves all the time. So it doesn't necessarily mean you have to know every dollar it's going to be spent. But if you have the the information there in front of you, that's the point in time that you need to be doing it, not when you've run out of money, and then now you're popping up a little bit more and a little bit more. And it kind of goes back to over talking about with actuary, you know, they've already recorded out for the quarter, and now the next quarter. Now they're having to report this big bump in reserves, because somebody finally recognized that we were under reserve in a file. And the question is, why wasn't this done last quarter, or last policy period. And, you know, you're left there standing like, well, because I really didn't look at anything. And now I'm being forced to put the money up, that should have been put up, you know, six, eight months ago, the changing conditions a little bit different in that kind of goes back to what I was talking to about under reserving is, if you have a strain can make it easy, have strain coming back strain. You know, there's typical treatment, conservative care that happens. But now all of a sudden, the complaints go on. Now they have an MRI or CAT scan and shows they have a herniated disc, and the doctor is now recommending surgery. So now we know that the disability is going to be much longer, there might be permanency, we have to account for surgery and recovery and you know, some of the things that go along with the cost of surgery. So that's a change in condition that you did not have available to you when you reserve file previously. So now you go through the same process of looking at what does that exposure look like over time, short term as well as long term?
Matthew Yehling:Right. Yeah, I appreciate that. I think just add on to that. Amen. You know, and we, you know, I work with a lot of different TPAs one of the things that, you know, if we see consistent, this, this adjuster is setting the Reserve at$5,000, a bill comes in, and it's a $5,000 bill, and then they're not recognizing the difference in in that development. And then, you know, they're adjusting the reserve every time a new bill comes in. So they're not really recognizing the changes. And, you know, we all are very busy writing in in claims and claims handling and that, you know, there's maybe a file that slips through the cracks. But when you're auditing the files, and you see like, hey, it's always with no, Bob the Builder, and it's, you know, I found every one of his claims, that's when it becomes an issue and you're not, you know, it's probably a performance thing when, you know, the reserving is not consistent with the claims handling, reserving philosophy there for the organization. So, so that's different. In fact, one, one bad, you know, one adjuster that's not recognizing that I want to say bad, but one adjuster that's not being proactive with setting the reserves, for whatever reason, may be impacting the whole organization in a very negative way. So I mean, that's, I mean, reserving is very critical. You know, I always preached my staff, it's reserving mitigation and settlement. If you're not doing those three things right, then. And if you're not doing the reserving reserving the critical part like you can do you can have a claims organization that doesn't mitigate and doesn't settle, if you if you have to reserve set appropriately. Yeah, but
Greg Hamlin:no, you're right, that and that, like you can, I mean, it's going to be reflected in your rates when you're trying to renew. So hopefully, we're doing those other things, because we want to have positive outcomes. But at the end of the day, if your reserves are off, everything could be off, and no one wants a 20 million or $30 million surprise, where we find out, Oh, it turns out all these files have not been where they needed to be. That creates a lot of heartburn, when that happens.
Unknown:I think also companies do themselves a great disservice by not educating the adjusters. I mean, you think of an adjuster, you think, well, they just adjust claims, you know, they process payments, or they manage return to work and they litigate, but they are the financial, back of the company. And if you don't understand as an adjuster, what the impact is to the company, and then the downstream effects. So if we're writing business, but yet we're spending more than we're bringing in, it affects not only that the financial stability, but from a personal standpoint, you know, my ability to maintain a job with the company bonuses raises, if there's none of this surplus from the profits we make, because we're managing everything really well. You you make it real for them and make them understand, you know, provide them that education from an actuarial and underwriting standpoint, then you know, that every time I pick up a file, it's not just this file that I'm impacting, it's my teammates, it's myself, it's, you know, other departments and the company as a whole. And I think that piece of it once you make it more personal like that, and they really understand the impact. And I think people tend to get better at what they do. Because then they understand, you know, how much control they have over that part of their, their jobs and their success in the in the role of an adjuster.
Matthew Yehling:I love the i 100%. Agree, thanks for bringing that up. Because I think we're going through that here at Midwest where, you know that the claims and the underwriting and a marketing and sales, we we need to know what you know what our impact in claims is, or the underwriting and the actuarial piece. And, you know, having that, you know, I'm not saying everyone needs to be an actuary, or everyone needs to, you know, be an underwriter, I'm saying, You need to know and understand, like, when we do this, it impacts how we sell, you know, how we sell our business. And when you do this, it impacts underwriting, and actuary. So having that relationship, you know, I think we all came from a similar organization where, you know, a lot of those people were all siloed and apart from each other. And that's one of the things I really appreciate with our organization. I know, Greg's is the same way at Berkeley industrial complex, you know, actuarial is right down the hall, or maybe in the next room or the next office or cube. And it's important to have that stuff close by and have an understanding of how your impact in the organization and what that means for all those other steps of the thanks for for doing that.
Greg Hamlin:No, I couldn't agree more. And I think, you know, understanding the 5000 foot view makes it easier when you zoom back in to know how what I'm doing impacts the company, and what things I can do that move the needle. Julie, as you think about reserving I want to zoom in on that a little bit. And talk about some of the things some of the details that make an impact on the reserves that if you were a claims adjuster or specialist examiner, whatever the word title is, for your company, what are some of the things that you should be mindful of when you're thinking about a reserve? Um, well,
Unknown:I think up Breaking it down, one of the first things I look at is, you know, the age education, maybe transferable skills of an injured worker. Also the mindset of the injured worker, you know, there's, you know, you have an individual who's suffering a work related injury that can be very impactful if you're they are working and earning a living for themselves for their families, and all of a sudden, now they've been injured, and that's been taken away from them along with any sense of control. So not only is an injured worker trying to recover from an injury, they're also financially impacted, and it can be incredibly stressful for them. So it's important you just your partner with the injured worker, you know, to ensure their recovery processes as stress free as possible. You know, and with a positive experience, it can have such a great impact on the best possible outcome of the recovery process, and then the overall financial outcome of the claim. So I already get my mindset and, you know, what am I working with? Who am I working with? And what potentially, can I do with this injured worker to make sure they have the best outcome possible? And then then how does that translate out into the overall exposure on the claim? You know, you're looking at comorbidity, it's important to determine what impact the comorbid might have on recovery, as well as any long term impact from an overall health standpoint, working with the customer is also important, you know, what is their ability to bring the injured worker back to work? If there are limitations? And is this just a short term fix? Or would they have a long term perspective as well? Because if they can accommodate maybe a short term, but what if those limitations are there permanently? Do I have a resource with the customer, because if not, it's gonna impact indemnity. And, you know, potentially the medical because, you know, you get all the factors of not being able to return to work, it just exponentially impacts the overall financial expense of the claim file, and is the medical care quality in alignment with goals of recovery, to return to work, and if not, what steps can be taken to make sure the best care possible is being provided. So if you're not getting what you need at the doctor, and the recovery is not progressing, and the necessary tests aren't being done, and there's really no focus of the doctor on the prognosis, and outcome and a treatment plan with timeframes built in, then maybe it's time to get another doctor and maybe get a second opinion or see if we can get better medical care. And of course, litigation, you know, when impact will litigate a claim have on management of the exposure and long term impact on cost to bring to resolution. You know, sometimes no matter how well you work with an injured worker, for whatever reason, they still, they still make it an attorney. And that process has to be thought about and brought into the impact it'll have on the exposure over a long term basis, as you look to either settle the claim or bring it to some form of resolution. Those are just some of the key elements that will impact how we look at the overall exposure. But I think those are some of the key that I look at when I'm looking at how I want to reserve long term.
Matthew Yehling:What you know, you just said a lot of things and you've had a lot of experience and expertise in the industry. But for a newer adjuster or somebody that's maybe putting together, you know, reserving best practice guideline, what resources are you aware of? Or what resources do you know that maybe we could point some people to and say, hey, you know, consider doing this, are you can you have a list or having some examples of resources?
Unknown:Yeah, so, the attorney and I think everybody can agree Medical is the most difficult part. I mean, the indemnity is relatively easy to evaluate compared to the medical, your jurisdiction is going to provide guidelines that spell out the limitations along with other factors like return to work potential, you know, whether or not there's impairment, other things that each jurisdiction has that's unique, that will aid in reserving for the indemnity, the real challenge is estimating accurate medical, some of the resources I rely on first and foremost are medical records, the different components of a medical record will really help you spell out not only what the injury is, but what kind of treatment is going to be anticipated. And then again, the treatment plan, and then prognosis, and that goes a long way into helping guide you into the number of weeks and the other costs that you need to factor in pharmacy, physical therapy nurse case manager. So those that's a good roadmap to start with. If the physician isn't addressing these two key factors, then you need to ask for it. I mean, it's as simple as that you need to have good medical reports and a good rapport with the doctor's office to get that information so that you're both on the same path to get this person either back to work or getting the right care they need. I also rely on the odg and you know, these guidelines are good resource and a standard reference for evidence based medicine you can get and they're not the end all be all I mean, you know, carpal tunnel may only be X number of weeks that you can expect disability but then you've got to factor in the other things, you know, as far as return to work options and if there's comorbidities and other things, but it's a really good guideline to give you an indication of how long somebody might be out and what kind of care is involved in that type of injury and or surgery, etc. I use the National Vital Statistics to address life expectancy and what Never think I don't know if it's underutilized, but it should be utilized. Probably I use it on all my claims that are reserved worksheet. If you've got to, it's a great tool to calculate exposures. The components of a reserving worksheet can act as a mind jogger to make sure all aspects of the caravan considered, I don't have any time. So I've kind of hand jotted down all the things that I'm thinking. And then when I go to put it in the worksheet, I totally forgot, you know, a DME, or pharmacy or even my nurse case manager who I've been working with, I totally forgot to account for those expenses. So the worksheet helps me break down those different and then think well, do I need that and if not, fine, but if I do you need it, I didn't think about it, there it is right in front of me. And when you have those different, like I said care components listed on a worksheet, you're not going to miss addressing, like you might if you're manually trying to capture each aspect of the care provided. Most companies have resources, they have resource tools for pulling data at the claim level, these tools are really great to see the actual cost and a claim that can be replicated when calculating out over time. And to give you an example, you know, I estimate physical therapy each session 175. Yet, when I pulled the claim data on that same claim file, I realized that I'm being charged for something. And then with the fee scheduling, I'm actually paying 325. So I'm almost 50% off on my calculation on PT. So pulling that data and really looking at the actual costs that are coming in helped me replicate that out when calculating out over the future. I've been in claims for many years, and I'm still learning something new all the time. I, if I can't readily find the information. I'll Google it. I mean, there's an amazing amount of information out there that helps me understand injuries, recovery time costs. Matt, you mentioned that, you know, something might cost you know, 5000, down here in Chicago, but up in Carbondale, it might be less expensive. I did it the other day looking at life care, the flights, you know, it's it's down here in Philadelphia, it might have been 25,000. But up in upstate Pennsylvania, it's only between nine and 12,000. So I simply Googled it, and I can find that information that might help me factor in what I need to set aside to cover that cost. And last but not least, your experience coworkers and key managers, I mean, what better place to start than the people you work with every day. I mean, most people, you have a variety of people with different experiences. And and I I'm chatting constantly, not only with my manager, but my teammates, like, Hey, have you ever seen this before? What should I expect your nurse case managers, they're a wealth of information as well. And they can help guide you on things that you might not have thought about. So it's there, those are some of the key things that I look at that helped me every day. And you know, even with all my experience, I still utilize these things religiously.
Greg Hamlin:I think I think you hit on so many good resources there. So hopefully, people will rewind and listen again. Because I think there really there really is a lot there. And you're not out on your own. That's the biggest thing I've learned and you are limited by your experience, I remember being a new adjuster, and I had a claim for the injured worker had a knee injury, and was 400 pounds and five foot one, and he has a new adjuster, you know, and had diabetes and a number of other health issues. This was years and years ago. But I remember, you know, not understanding, I went into odg guidelines and saw Well, what's a meniscal tear cost, you know, and it gave me some guidelines. And I remember the senior on my team saying, Well, wait a minute, you know, he's gonna have to be weight bearing on this knee, he's very heavy, that's going to cause a lot of problems with his recovery, you need to be thinking about that these guidelines aren't going to tell you all that. So in that case, I went to a resource, but I still needed help from somebody with more experience that could kind of point me in the right direction and say, Have you thought about this? And she wasn't wrong. I mean, that was a difficult claim. And we were able to identify that pretty early that there were some challenges there. So I think you made some great points on on what's out there as far as resources go. And you you talked about this a little bit. But when you talk about documentation, so we know like in a perfect world, every claim would live with the person who had it from the day they got it. And I think we've all know that we don't live in that world that files get moved around. People have new opportunities, people retire, people get promoted, people leave the company, and when somebody's taking over a file for somebody else, that can be really challenging. So talk a little bit about documentation in in from your opinion, Julie, and some of the roles you've been in why that's important.
Unknown:Document notation. It tells the story and it sets the roadmap for where the claim is going. I mean, you're looking at reserves. In particular, you want to have a detailed rationale spelling out the basis for the reserve and the duration. You know, what are your short term goals? What are the long term goals? And when I'm looking at my files, I you know, I look at short term and I look at long term each and every time you know are there key miles sounds to consider. I referenced my reserve rationale, every time I'm in a file to see if what I had planned is still on track. Or if I need to make adjustments based on new information, detailed documentation, it actually forces you to think about how that claim is developing and what the plan is to mitigate the loss and bring the claim to resolution. So if you're really thinking about all the components, and you're thinking about your claim, and you're kind of just putting out that story, I do my rationale first, because then that helps me then level set on what I want to set aside in the way of funding for for all of those pieces of the rationale. I don't do my reserve breakdown first and then go back and do rationale. It's the rationale first, and then it dictates what my breakdown is going to be in, in the documentation. Like, you have to look at the mitigation of loss and how you're going to bring it to resolution. So that's part of your plan within your rationale. And I know, having a all of us have heard this a million times the file should speak for itself. And this is definitely important. From a reserving standpoint, I don't know many times I've picked up a file. And you know, it has a couple of items in there about, you know, the indemnity breakdown, and there's permanency. But I have no idea how they came up with that permanency number, I have to then go back and do research to figure out, you know, we handle a lot of jurisdictions in my current role. So I'm not an expert in every jurisdiction. But I have no idea how this is calculated and where those numbers come from, what is it based on? And there's not enough information in the rationale theory is even a rationale there that helps guide me to understand what the adjuster was thinking. Same thing, if my manager picks up my file and is reviewing my file. She shouldn't be or he should be able to go in and look at my rationale and see if it makes sense for what I'm calculating out over the life of the claim at that particular point in time.
Matthew Yehling:Yeah, thanks for sharing that. And I think you're hitting on something that maybe it's a question for both you and Greg is looking into different partners and the TPA level and carrier level, I do see a tendency and you know, I'm not trying to say this is bad for that it's a trend wide in the industry. But there's a if you get it, most adjusters have some level of authority, right? So you're going to broaden that authority based on their experience and their comfortability, and maybe the account or the account specific service instructions. And so, sometimes you'll see, hey, I've given them $50,000 authority, and all sudden, a lot of their claims brought up right against, you know, $50,000 or $49,000. Yeah, it's like, this is kind of odd. So yeah, and you go back and you're like you currently start questioning that, that practice. And what you hear is like, Oh, well, I didn't want to have to fill out the form, or I didn't want to have to do the documentation to get to take it to the next level of management. So how do you address that? You know, and you know, for your organization, Greg, and or Julie, like, what have you seen, like, how do organizations like tear down that wall and simplify that process? So adjusters are willing to bring up the reserve and my president of the organization, which I loved when he said this? He said, Hey, bad news doesn't age? Well, and, yes, me like an adverse reserved development is bad news. So like, I want to be on top of those, and how do we encourage the industry as a whole, that to be more forthcoming and be forthcoming, not more forthcoming, but be forthcoming on reserving? Because I don't know that it's a huge problem. I definitely see it, but maybe some best practices around that. So little bit of a loaded question. I apologize.
Greg Hamlin:No great questions. And I think these are real challenges, obviously, I think part of it is talking about it all the time. And I think you kind of hit on that, like in our department meetings we talked about all the time, you know, let's get those reserves up. Let's make sure we got them to where they need to be. Let's make sure they're well documented. So if you're not here tomorrow, because you won the lottery, we'll go with a positive, a positive outcome, that, you know, the next person could pick that up, and you're not putting pain on them. And I think, you know, there's no silver bullet to this, but I think training, auditing, reviewing files and being involved, all those things matter. One thing we do that I think is helpful is we do catastrophic claim roundtables every two weeks, we talk about these claims from a reserving perspective from an injury perspective. And we invite everybody in on those because we feel like everybody can learn together. And somebody might have an idea that somebody else has thought of. Some of those are some of the things I think, you know, and you know, in a past life, Julie managed an examining team and had to probably look at some of these things from that perspective. Julie, what are your thoughts?
Unknown:I think probably one of the key things that might prevent adjusters from diving in and really looking at reserving is the medical and understanding medical. It's intimidating and if you don't have a medical background, which I would probably say 80% of our industry does not that are actually claims adjusters. Now you're having to think like a doctor, and you have to understand medical terminology. And now figure out, how does that impact a claim. And in many years ago, there used to be a requirement that you took medical terminology. So you understood what medical terms now you're kind of on your own, you gotta, like I said, Google it, you know, and look at and try to understand it and learn. And as you get more experience, you feel more comfortable with those things. I think the other thing is intimidating is just the value. I don't know how many times I've seen people not reserved something, because it's, it's more than their authority, or it's not necessarily because they want to avoid reserving over the authority. It's intimidating to come and say, I want to put on, you know, a million dollars in a reserve. That's kind of Whoa, and to me, you know, years of experience millions is not then and now it's like, oh, you know, it's 758 Doesn't matter. It is what it is. And I think that concept of how you reserve a file for 20 1000s, the process that you use at reserving that claim for 20,000 is absolutely no different than how you reserve a file for 10 million. Now, understand all the different components is obviously based on experience and your level of understanding. But the philosophy and the process and the resources and tools is identical, no matter what stage of that claim you're in financially. And I think if you can remove that fear factor, and then used to draw the curtains back, and adjusters understand that I think they'll be a little less fearful and more fearless in going in and tackling a reserve. They really I mean, it's also it takes time. I mean, it takes time to sit down and actually reserve a file and it doesn't matter what level it is. And I think as organizations look at their financial health and how well we're doing and reserving is get to the key. You know, the key drivers is why we might not reserve is it an educational level? Is it you know, we're understaffed, you know, are we allowing our adjusters enough time to thoroughly evaluate and kind of goes back to the old adage of, you know, Pennywise pound foolish if you just add one adjuster, that one adjuster salary, and all the benefits associated are taken care of, by one mistake in reserving. So if you can avoid it, it makes more sense to hire an adjuster than it is to lose hundreds of 1000s of dollars in a claim that wasn't reserved properly. So you got to kind of think holistically about reserving and really understand what's driving our inability to get reserves done correctly, whether it's, you know, as a whole, or individuals, and then from there, so are building, building that person's capabilities by looking at the different resources available to help them achieve those kind of goals that they need to achieve to be successful in the role.
Greg Hamlin:That was fantastic. Julie, you said it better than me. I thought you explained that very well. Well, I first of all, I just want to say I appreciate all the information you shared today, I felt like we've tackled a pretty tough topic that could be pretty company specific and did it in a way that I almost feel like no matter where you work, you could gain something from this that could help you be a little bit better at what you do. One of the things Julie we're doing this season is I'm trying to put some good vibes out in the universe. I felt like there's plenty of negativity. And so I decided to end each episode, talking to whoever our guest was, and asking him this question. What is the favorite part of what you do each day? So of all the things that you do, what gets you going in the morning? Or what gets you excited about what you do? Well,
Unknown:you know, I, obviously I enjoy the claim process. And if you can't tell I really, you know, I'm passionate about reserving I look at the claim process and the challenges that they're faced with each claim. I learned something new all the time, which definitely keeps things interesting. And it says we've been focused on reserving, I'll add that reserving while it's difficult times is a challenge I really like to tackle. And it's really satisfying to see a file that's been managed well, and the reserves were accurate throughout the life of the claim, you know, aside from my team, and the people I work with, which is it always makes the job that much more doable and fun. But really, one of the things that just really gets me going is the satisfaction I get from seeing an injured worker recover enough to return to work or find that resolution to their claim that works well for them. And, you know, and I know that I've been a part of that journey, there's something innately satisfactory about that and you know, kind of in that empathy factor, you know, that I haven't gone through it, but I have empathy for what they're going through. And regardless of it's a litigated claim or not, it doesn't matter. You know, I tried to think of these people, it's like, how would I want to be treated and I try to live by that every day. And then when I see that we've had some kind of satisfaction, satisfactory conclusion to a claim where they're made as whole as they possibly can be made. It's it's really, it's really quite a perk of the job. And it's
Greg Hamlin:fantastic. I feel like that's what we're The business of sometimes we forget, we're in the business of helping people get back to work and get back to life. And those are the best moments when you know that you've made, you've done the right thing, and everybody benefited from the right thing that was done.
Unknown:Yeah. And I feel supported by the company. So it's nice, you know, it's nice to have that support that you're, you're being supported to do the right thing, regardless of the cost. And to have that is, it says a lot about, you know, where I work, and the satisfaction I get out of my job every day. That's awesome.
Matthew Yehling:It's a mind. It's a mind shift. Right? Because I mean, I know your organization is big on Home for the Holidays team. Yeah. I think like, if that's promoted through the whole organization, it you know, it promotes the mentality with the different departments and underwriting and sales and claims, you know, it's like, brought here to do a different piece. But it's all for, you know, that injured employee, and how do we get them back to again, cool situation there. They make the wrong right kind of mentality. Appreciate it. Thanks for Thanks for the time, Greg and Julie.
Greg Hamlin:Oh, no, it's been fantastic. And I want to thank Matt and Julia, also, you know, in the background that everybody gets to hear, but we've got Natalie dangles, who does our blog each week. So I encourage people to, if you didn't have time to listen, and you want to read you can do that. Or if you just want to go back and use it as a reference of what went on in the episode. She does those every other week. And then special thanks to Jacob Holmes, who's also hiding in the background. I always say he's my, I've got teenagers and they have filters on their phone. He's our filter. He makes us look amazing, so that we all come out of everything looking like rock star. So thank you, Jacob for that. And I just remind our audience to do right think differently. And don't forget to care. And that's it for this episode. Thanks, everybody. We'll catch you next time.