Sarasota, FL(WorkersCompensation.com) – A major turning point occurred in the workers’ compensation system last week. Revered industry veteran Peter Rousmaniere is ‘retiring,’ at least, from his current role as keen observer, independent consultant and prolific writer of all things workers’ compensation. He’s setting his sights on ‘greener’ pastures,
“I aspire upon retirement to do some writing on changes in America in the first two decades of this century,” he said. “I feel these two decades may be the most important decades in America in over a century.”
Climate change, the acceleration of information technology and globalization have had dramatic impacts on American life, he says. “I believe we are in the stage where there is a major shift in industrial life in America.” Artificial intelligence and genetic treatments in medicine are “two examples of where we will see a major shift in the way the world works for us.”
Rousmaniere has already tapped into his expansive network of connections for insights into his next endeavor. Over the next few days, Rousmaniere will bid adieu to friends, colleagues and associates he’s known during his decades-long venture in the workers’ compensation arena. He recently sat down with WorkersCompensation.com to impart his knowledge and insights about the changes he’s seen and thoughts of the future for the workers’ compensation system.
Experience, Industry Changes
During the 1980s, Rousmaniere had what he describes as a “very small” consulting firm in New England which “advised employers essentially how not wo screw up in working with their injured employees,” he explained. “The strategies we introduced were new to the industry but now are universally recognized, which is being highly responsive on removing barriers to return to work.”
Developing a high quality provider network, for example, was one of the pathways he identified as helping injured workers recover faster and return to function and work. While there is more acceptance of that idea now, Rousmaniere says “even today there’s some remaining ambivalence in the industry about how much to invest in high quality medical care.”
The industry went through a significant change around 1990 when “a tsunami of managed care came into the industry, and that wave is still working up the beach,” he reflected. “Much of what we talk about and do in workers’ compensation is that wave of managed care.”
Recent years have seen improvements in the management of claims, he says, particularly by insurers. He credits them for becoming more self-disciplined in reserving and claims practices, which he says is “one of the reasons we don’t not have strong cycles in pricing … the greatest single risk in workers’ compensation is not employee abuse or bad medical care, it is bad management of insurance.”
Rousmaniere believes there is now better analysis of medical providers than there has been in the past. Measuring quality performance is not an exact science, but the methods have improved. “There is greater focus on the injured worker,” he said, “that is part of a shift toward more and more attention to the consumer, with the focus on convenience to the consumer and motivation of the consumer.”
At the same time, Rousmaniere is concerned about what he refers to as entrepreneurial medicine, where the primary focus is on making money for the provider rather than caring for the injured worker. But with better analysis of the performance of medical care and greater attention by payers, he believes medical care will be easier to manage.
“Workers’ compensation claims payers tend to underinvest in medical intelligence,” he said. “Medical intelligence means very aware and skillful physicians involved in designing claims practices; it involves better day-to-day triaging of medical issues by claims adjusters. There tends to be a cultural divide between traditional claims management and medical expertise on the other hand.”
The focus on the injured worker as a whole person rather than a “widget” will bode well for those claims organizations that take that view, especially if they pay attention to the psychosocial dynamics.
Within the next 5 to 10 years, Rousmaniere believes AI will play an increasingly significant role in insurance and on claims and the underwriting of policies.
How insurers and third-party administrations respond to safer workplace will be an interesting issue to watch, as well. “Until about 5 years ago, they really didn’t have to deal with the reduction in injuries because the costs were rising faster than the injuries were dropping … about 5 years ago they stopped rising and became pretty much flat or slightly increasing; that includes both indemnity costs and medical costs,” he said.
He believes there will continue to be moderation in average costs per claim and a reduction in the frequency of injuries. “So the question is, how will insurers and TPAs keep the attention of their clients. And that calls upon insurers and TPAs to be much more helpful, imaginative, and focused to both employers and injured workers.”
A “crisis in state oversight” is another concern about the future, Rousmaniere said. The introduction of managed care and “crises in the insurance market” led to productive discussions with state regulators and legislators years ago. “Also, over time they’ve been effective in in strong policies regarding opioids,” he said, “but at the present time, I see no visionary, no governor or legislative body, or executive branch agency where you would go to have a fruitful discussion about where workers’ compensation fits in.”
Laws enacted in recent years have become more “restrictive” in terms of the injured worker and benefits. “We do not really know the impact of that yet,” he said. “When a major problem in claims arises – such as carpal tunnel in the 1980s and opioids starting around 2000, it takes about 10 years to fully recognize the problem and 10 years to complete a response. And we are now seeing in workers’ compensation a pretty successful response to opioids.”
Over the years Rousmaniere has become especially passionate about immigration, on which he writes a blog. He noticed that while 13 percent of the American population is comprised of foreign-born people, 20 percent of workers’ compensation injuries are sustained by them.
“When you look at foreign born injured workers you ask yourself, ‘where do they come from’ and ‘how did they get here?’ Then you look at the medical providers who are treating these workers and one-quarter of all practicing MDs in American are foreign born today,” he said. “So what happened with me is that I saw through the lens of workers’ compensation a vast connection between America and the rest of the world.
“I think that on balance Americans have a favorable feeling about immigration but are very concerned about the large number of low-wage, poorly educated foreign-born, many of whom are here unauthorized,” he continued. “And the workers’ compensation system tends to deal with unauthorized workers quite fairly, and that is a commendable achievement of workers’ compensation claims payers. But if you look at society as a whole, their presence is very controversial and has been a key driver in fragmenting our political system.”