Disability claim examiners need to learn how to make effective use of online resources-and disability producers need to understand how the examiners are using those resources when looking at their clients’ claims.
In the disability market, insurance risk management has become increasingly complex. Pre-existing condition exclusions, self-reported illness limitations, discretionary clauses, and Social Security practices continue to be closely examined. Insurance departments, courts, and plaintiffs’ attorneys across the country are scrutinizing insurers’ claim practices. Over the course of the past year, the economic environment has triggered cuts in benefit programs and employee head counts
With increasing frequency, insurers are using technology, among other resources, to help them effectively manage risk.
When employed appropriately to supplement claim investigations, online resources can help insurers make timely and accurate claim decisions while holding down costs.
Claim examiners need to take a strategic approach to determining which investigative tools will be most effective for organizations.
Speed is one consideration.
The federal Employee Retirement Income Security Act often requires that a liability decision be rendered within a specified time period. Meeting the deadline can be particularly challenging for an insurer to finalize a claim decision within a mandated period of time if:
–The policy has a lengthy elimination period;
–The claimant is reporting multiple co-morbid conditions; and/or
–The pre-existing condition exclusion applies, requiring the review of medical records that pre-date the effective date of coverage.
Insurers have an obligation to obtain and review all information that is pertinent to the eligibility decision prior to making a determination. Denying a claim and subsequently receiving information (available at the time of the initial decision) that alters the decision creates challenges for both the claimant and the insurer.
The situation can be even more problematic when a claim is approved, benefits are paid for a period of time, and the insurer discovers information (that existed when the claim was approved) that impacts the claimant’s eligibility for benefits. The insurer has the burden of establishing that the claimant’s condition changed to warrant the termination of benefits. The insurer’s lack of diligence when initially investigating the claim is not sufficient grounds for terminating benefits.
Clearly, obtaining complete information early in the claim investigation process is of paramount importance.
Once an insurer has clearly identified its needs and goals, it should invite vendors to demonstrate their products. These demonstrations are incredibly enlightening and allow insurers to test a few claims, present various scenarios, and ask questions. Claim examiners can see firsthand:
–The source of the information.
–The level of detail captured.
–The reliability/quality of the data.
For the insurer, the time and cost savings that can be realized by utilizing some tools will be immediately apparent. Other tools will reveal limitations that must be carefully considered.
In the disability insurance arena, using a combination of advanced search engines, social networking sites, and government databases has proven effective. Pipl.com, Wayback.com, Google Earth, IntelliScript, Accurint, MySpace and Facebook are among the most user friendly tools available and have proven to be very helpful in claim investigations.
Limiting user access
Historically, the primary claim management tools have consisted of computer software programs and industry databases. Much has changed–and most notably the integration of deep Web search engines and social networking sites. Insurers now routinely turn to these online resources to enhance their claim investigations.
That said, putting online tools in the wrong hands can be counterproductive. There are legal and practical reasons why insurers must exercise extreme care in determining who will have access to the tools. The size of the organization and volume of claims managed will influence the appropriate number of dedicated users, however, access should be granted only to select employees who will utilize the tools most effectively and for the purpose intended.
Employers have been held responsible for illegal computer use by employees. To protect the confidentiality of nonpublic personal information, users must be authorized to access certain search engines and databases. Routine audits are conducted to ensure compliance. Third-party administrators, self-insureds, insurance companies, law enforcement, criminal justice, and regulatory agency personnel are typically granted authorization. The information must be used exclusively for the purpose of processing insurance claims, investigating, detecting, and preventing fraud. Use of the data for other purposes is strictly prohibited. The Gramm-Leach-Bliley Act of 1999 and the National Association of Insurance Commissioners permit the use of these databases for fraud fighting and for claims administration purposes.
But, it’s important to emphasize: employers are responsible for the misuse of database information by employees and must fully investigate and report any violations.
There are practical reasons why many employers use security filters to prevent employees from accessing certain Internet sites. Some employees are spending excessive amounts of time online, distracting them from their work and significantly reducing productivity. “MySpace” and “Facebook” claim to have more than 300 million users combined. Employers without firewalls programmed to block access to these types of sites can reasonably expect that their employees are visiting these sites throughout the workday.
When deciding who should have access to these valuable online tools, insurers should consider their most disciplined employees. They will have at their fingertips an abundance of information with links to related topics and sites. It is easy to become sidetracked and employers will want to grant access only to those employees who can be expected to use the tools appropriately.
One insurer recently noticed a handful of employees were regularly visiting a claimant’s Web site to read his blog, in which this colorful character described his recent adventures. Considering that the claimant reported difficulty ambulating and the inability to sit or stand for more than a few minutes due to failed back surgeries, they were fascinated by his ability to drive for 14 hours through several states, with only a short rest break. While reviewing this public information may be of benefit to the claim investigation, when it becomes entertainment, it has the potential to negatively impact productivity.
Candidates considered for online access should also be detail-oriented and possess solid critical thinking skills. They must have the ability to elicit factual information and recognize and resolve any inconsistencies. For example, during a particular claim investigation, background information was obtained on a young claimant who had been receiving a small disability benefit for several years. While on the surface the report appeared relatively benign, an examiner with a critical eye noticed that the claimant had purchased a home without requiring financing. Further questioning by the examiner revealed that he paid for the real estate with proceeds he had recently received as part of a third-party settlement related to his disability claim. The disability policy entitled the insurer to reduce his disability benefit by the settlement amount.
Taking a thoughtful approach and exercising discretion in determining which employees should be granted access to specific tools will maximize the benefits of these tools.
For claim examiners, the greatest concern with online resources is that they can, and often do, prejudice claim examiners.
There is a tendency to give the information more weight than warranted and neglect to gather information from other important sources. This is particularly true when information is obtained through social networking sites. An examiner may learn about various hobbies, employment, or social activities that appear to be inconsistent with what the claimant has reported. When this occurs, the claim examiner should dig deeper and work to validate the veracity of the information and determine its relevance to the claimant’s true functional capacity.
When in possession of what appears to be a proverbial “smoking gun,” the disability claim examiner must not lose sight of the fact that the eligibility decision must be supported by persuasive medical evidence.
When examiners lose objectivity, the ability to render a thorough, fair, and well reasoned claim determination is compromised. Clearly, the advantages of utilizing online resources to supplement claim investigations far outweigh the drawbacks, but with insurers being held to a higher standard, it is critical that they demonstrate restraint, maintaining a balanced approach throughout the investigative process.
Tracey Zinck is assistant vice president, claims, at Disability RMS Inc., Westbrook, Maine, a provider of disability risk management products and services.