SFM Agent Agenda

SFM asks that each insured employer commit to return-to-work. Sometimes that means you, as the agent, may need to be involved.

For example, you may receive a letter or email from your SFM underwriter asking you to follow up with a particular employer and get something in writing.

Here are tips and resources that can help both you and your clients.

Employee practices
SFM looks for employers that care about their employees and want to do the right things when employees are injured. That includes regarding return-to-work as part of the accommodations for managing employees who are recuperating from injury.

Practicing return-to-work is one of the most effective ways an employer can control the costs of workers' compensation claims.

An employer can convey its return-to-work commitment to SFM in a number of ways. One of the best is to develop a policy and put it in writing. Besides forwarding the written piece to you and SFM, the employer can expand the document over time and share it among managers and employees. Having its commitment in writing helps create expectations and accountability.

You can offer these resources to help clients create return-to-work policies, practices and written statements:

• "Return-to-work: A basic policy" CompTalk. A one-page piece to help employers get started developing a written, four-step program.
• "Return-to-work program sample." A sample written return-to-work statement that an employer can adapt to help develop its own statement. Available in Word format.
• Employer Kit. The "Planning return-to-work" section is an excellent primer. Also explains how to report injuries and other basics on doing business with SFM. Sent to new SFM policyholders over $10,000 premium. Order copies in the Resource Catalog. The online version of the kit includes state-specific information.
• Companion magazine, April 2012. Special "Return to work" feature, in lay language. Focus: (1) why return-to-work matters, (2) how to make it happen, and (3) a further opportunity that can yield major benefits. Recommended reading for employers. Order copies by emailing us.
• Return-to-work webcast. Video recording of SFM's May 2012 webinar, "Return to work: Two reasons why. Six steps how." Presented by experienced SFM legal and claims staff. 60 minutes.

SFM claims representatives are also excellent resources for employers and agents, especially in special circumstances.

Look for opportunities to make return-to-work a part of your discussions with clients. Help them think of it as part of their human resource strategy and their approach to controlling business costs.

The weight of claims costs that go into figuring employers' experience mods is scheduled to double next year, the first increase in more than 20 years and the first in a series of annual increases scheduled by the National Council on Compensation Insurance and most state rating bureaus.

The change is expected to push up the e-mods of employers with frequent, less severe lost-time claims.

However, the NCCI and other rating bureaus project the change overall nationally to be premium neutral.

Help clients control loss costs
Agents can work with individual clients to lessen the impact of the change on their e-mods. Helping them with early return-to-work and better injury prevention are significant ways to reduce the cost and frequency of claims and produce positive impacts on their e-mods, according to SFM officials.

The change in 2013 is effective:

• Jan. 1 in Iowa.
• Jan. 1 in Minnesota, if approved.
• Feb. 1 in Nebraska.
• July 1 in South Dakota.
• Oct. 1 in Wisconsin.

In Minnesota and Wisconsin, which are not NCCI states, the change was approved by the Wisconsin Compensation Rating Bureau and is under discussion by the Minnesota Workers' Compensation Insurers Association, which typically follows the NCCI's lead on changes like this. Iowa, Nebraska and South Dakota operate under the national rating bureau services of the NCCI.

$5,000 threshold to change
Currently, the e-mod calculation for an employer puts losses into two buckets. The first $5,000 of a claim is the primary amount. Above that is the excess amount. All of the primary amount for each lost-time claim is included in the e-mod calculation. Excess amounts are given partial weight depending on the size of the employer.

The rating bureaus' $5,000 threshold—or "split point," as it is called—was put in place more than 20 years ago. Since then, the average claim cost has tripled, according to the NCCI.

To update the split point, the NCCI and most non-NCCI states plan phased-in increases. The current $5,000 doubles to $10,000 in 2013, then rises to $13,500 in 2014, and $15,000 in 2015. After that, the split point will adjust annually to a national claims cost index.

According to a Wisconsin WCRB analysis of the effect of raising the split point to $10,000, "insureds with greater than a 1.0 mod tended to receive more of a debit."

The Wisconsin bureau analysis also shows that the percentage of claims above the current $5,000 split point rose from about 60 percent of claims in 1998 to nearly 80 percent in 2011, due to the continuing rise in claims costs.

For more, see NCCI's on-demand webinar on understanding filed experience rating plan changes.

"Van driver killed in fiery collision," read the headline in the Nov. 24, 2010, St. Cloud Daily Times.

The stepdaughter of the killed driver, a high school senior aspiring to a master's degree and a future in architecture, was awarded a $5,000 Pat Johnson Honorary Scholarship for the 2012-13 school year recently by the SFM Foundation Board.

The Foundation received 41 applications this year, a record high. The board in May approved 14 scholarships totaling $28,500—also record highs.

"People teared-up reading some of these applications," Dave Kaiser, executive director of the Foundation, said. "It reminds you why we're doing this."

This year's awards bring the total number of higher education scholarships awarded by the Foundation in its first four years to 44.

Recipients are awarded up to $5,000 per school year for up to five years of schooling.

The $28,500 in new funds for the 2012-13 school year brings to $72,000 the total amount of scholarships for students planning to attend this fall.

Scholarships are awarded regardless of the workers' compensation insurer involved in the parent's work injury. The 44 scholarships awarded so far involve claims handled by 27 different insurers and self-insurers.

Golf fundraiser
Golfing for Scholarships, the Foundation's major annual fundraiser, is set for Tuesday, June 26, at Prestwick Golf Club in Woodbury, Minn. Agents are invited to register.

When an employee with access to CompOnline and SFM Application Manager (SAM) leaves your agency, be sure to take the steps needed so the password can be disabled.

You should either contact SFM or your agency's CompOnline administrator, if you have one.

Do not transfer the password of a former employee to a new employee, and do not share passwords among individuals. Instead, request new passwords using the "CompOnline agent registration form" on sfmic.com or have your agency's CompOnline administrator set them up. Your agency can have an unlimited number of accounts and passwords.

Bob Mahowald Jr. of the Mahowald Agency, St. Cloud, Minn., gets down and dirty during the grueling "Tough Mudder" race in Somerset, Wis., in May. Employees of the Mahowald Agency formed a team of eight to raise money for a client and SFM policyholder's capital fundraising campaign.

Tough Mudder is a hardcore 10-mile obstacle course designed by British Special Forces that tests strength, stamina and camaraderie.

Policyholders also retained Madison, Wis.-based Strohm Ballweg LLP as SFM's independent auditor.

In this case, the attorney for a client whose benefits had been reduced due to overpayment attempted to avoid further reducing his weekly payments by seeking to get her attorney's fee paid through an expansion of so-called Gruber fees, a precedent under which the employer pays the fees for an employee's attorney when they successfully defend the employee against an accusation they received benefits in bad faith, and there aren't any benefits being paid to the employee from which the attorney can draw.

"I was relieved and happy when the decision finally came in, because it really would have changed the landscape of attorneys' fees" said SFM attorney Danielle Bird, who argued the case before the court. "Instead, I think it really just solidified that there are limits on fee shifting in workers' compensation cases."

The Wisconsin Legislature has passed legislation making mostly minor revisions in at least a dozen areas of the state workers' compensation system, including health service fee disputes, third-party liability, vocational rehabilitation, and maximum compensation for permanent partial disability. The Wisconsin Worker's Compensation Advisory Council, including labor and management representatives, helped develop the legislation.

Three residents studying occupational medicine at the University of Minnesota recently visited SFM weekly for about a month, participating in medical-legal sessions and file reviews with SFM in-house physician Dr. Dan Janiga. They also spent time with specialists in underwriting and claims.

"The whole idea is to give the residents overall exposure to multiple workers' comp insurance issues," Janiga said, "in order to help them understand how critical it is that they document very, very well."

SFM is partnering with 9-Mile Creek Watershed District and Bloomington School District to offer the workshop "Go Green: Learning to protect the environment while maintaining your buildings and grounds this winter" July 17 and 24 at SFM's headquarters in Bloomington, Minn.

The interactive, three-hour workshop provides practical advice on maintaining small sites, sidewalks and parking lots on school grounds during the winter, including the latest tools and advice on environment conservation and safety.

If your school clients are interested in hearing about being environmentally focused while maintaining their grounds and infrastructure, encourage them to contact an SFM loss prevention representative at (800) 937-1181 or go online to register.