States Trend Toward Digital Conversion in Work Comp

Karen Ridder

Houston, TX ( – The 24,000-square-foot building that used to house all of the hard-file records of Texas workers’ compensation claims sits empty.

According to a Texas Division of Workers’ Compensation news release, it took two years for the state to digitize 26 years of claims. The result will now save the department hundreds of thousands of dollars in storage costs.

Texas Workers’ Compensation Commissioner Cassie Brown said the project accomplished two major goals.

“From the very beginning, the goal was to use new ideas and approaches to improve customer service while reducing costs,” she said.

Texas joins many states across the country already completing what is generally a lengthy conversion process from paper to digital workers’ compensation files.

Kansas started a conversion in 2015. In that state, the Online System for Claims Administration Research/Regulation (OSCAR) project was a multi-phase project to implement online claims.

It took until October of 2016 to complete the planning process. On April 1, 2017, the OSCAR Project moved into an implementation phase. The Kansas Department of Labor is planning a full system launch scheduled for Nov. 30, 2018.

According to the National Council on Compensation Insurance (NCCI) Communications and PR Director, Dean Dimke, digital files are becoming the industry standard. There was a time when Proof of Coverage was supplied to each state in which an insurer went through a completely hardcopy process — Paper proof was supplied individually to each state where there was coverage.

“Today — for the 38 states in which NCCI provides Proof of Coverage Services — all services are conduced digitally with the state. Carriers report coverage to NCCI,” Dimke said.

NCCI supplies each of the states coverage details in either a file feed (in the state’s requested industry format), or through online access (through NCCI’s Proof of Coverage system), or both. Each state to which NCCI provides services to has access to the coverage supplied to NCCI for insureds in their state in a digital manner.

Other states are still working on digital conversion.

  • In Virgina, the Workers’ Compensation Commission set out to digitalize its claims filing system in 2016. This was ten years after the commission started looking at the issue. They were dealing with paper forms as old as the Commission itself that had been simply altered over the years or added to as laws changed. The state worked on an Electronic Data Interchange (EDI) to be more efficient and accurate in data collecting.
  • In California, the state went electronic for Workers’ Compensation case management about a decade ago. However, that state decided that the process of scanning all pre-electronic era forms was too unwieldy. Instead, they keep the files for the period of time required for public agencies before being purged.

The electronic case management system, called EAMS, cut out what had been an ongoing need for the growth of storage space. It also took up a lot of staff time. While paper files can be scanned and digitized into the electronic EAMS database, the majority of new forms are currently filed electronically through a secure internet connection. California Department of Industrial Relations (DIR) spokesperson, Peter Melton, reported old files are only scanned into EAMS on an as-need basis for ongoing cases. Files are shredded after they are scanned.

“Because of the amount of documents filed in the pre-EAMS era, it is not feasible to scan every single case into the system,” Melton said.

DIR also notes the electronic filing helps the process in California run smoother and faster.

“Electronic filing eases the transfer of information across the division’s 25 courts statewide, as well as gathering information for analysis to guide policy decisions,” Melton said.

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