A New Approach to Disability Management

Lisa Scotton


November 1, 2009

As the saying goes, what is not measured cannot be managed. In the workplace, this holds true for non-occupational illnesses and injuries that, while costly in their own right, are tracked in less detail than work-related incidents that result in workers compensation cases.

Employers need to take a risk management approach to absence management by targeting trends associated with non-occupational, short-term disability and using workplace solutions that yield measurable results. To do so requires a closer look into absence data to identify common diagnoses, uncover trends in medical issues and identify contributing or aggravating factors in the workplace. But for those willing to do the work, the payoff may very well be improved performance, more effective health and wellness interventions, and reduced financial, safety and productivity risks.

When assessing employee absences, many employers look at duration with the objective of bringing employees back to work as quickly as possible. Typically this is accomplished with a return-to-work (RTW) program that offers job modifications or temporary assignments elsewhere in the company. With integrated disability management, however, companies can expand RTW from its traditional use in workers compensation-where getting the employee back to work means reducing indemnity costs-to include non-occupational illnesses and injuries.

Limiting duration does target some of the financial risks associated with employee absence. But what of the other risks posed by absences? Safety, productivity and the impact on other programs also need to be assessed since workplace risks are often intertwined. Without cross-functional, integrated disability management and communication, the potential risk exposure increases.

Rather than looking at employee absences according to how the case is handled-i.e., keeping workers compensation and short-term disability separate-a risk management approach calls for a deeper understanding of causes, medical issues and the effect on the organization. An effective risk management approach involves multiple disciplines to determine ways in which health, wellness, and injury prevention programs will result in a favorable return on investment.

Identification Challenges

Identifying root causes and effects of non-occupational illnesses and injuries is more difficult than studying trends in workers compensation cases, however. One reason is access to information. Under the Health Insurance Portability and Accountability Act (HIPAA), for disclosures of protected health information related to workers compensation, the minimum necessary standard permits covered entities to disclose information to the full extent authorized by state law or other regulation. In other words, employers are allowed to know the causes of a workplace injury or illness. With non-occupational cases, however, HIPAA confidentiality and protection bars employers from having direct access to employee's health information without the employee's signed authorization.

While the cause-and-effect link may be difficult to obtain on the individual level, trend data amassed from non-occupational illnesses and injuries can still be enlightening. Short-term disability claims data should be analyzed-either internally by the occupational health department or externally by an insurer or third party provider (TPA)-to identify patterns and trends. The objective is to identify common causes of absences within a specific employee population, job, location or department. For example, analysis of claims data indicates a significant percentage of cases involving respiratory conditions. This, in turn, would necessitate health and wellness programs that target respiratory issues, from smoking cessation to managing asthma.

A variety of solutions for analyzing short-term disability are available. Employer Measures of Productivity, Absence, and Quality (EMPAQ), for example, offers analytic tools to measure cost and productivity, RTW and employee satisfaction. Companies can also request in-depth data analyses from their occupational health departments or TPA.

Greater awareness of non-occupational illness and injuries also bridges the workers compensation arena. For example, if a certain portion of employees have respiratory issues, are there workplace risks that could lead to increase absenteeism, whether as short-term disability or workers compensation? Are there irritants present in the work environment that, while within Occupational Safety and Health Administration (OSHA) limits, could affect people with a certain degree of sensitivity? Without the data analysis on the non-occupational side, an employer would not be aware of an unaddressed risk until it reached the point of showing up in workers compensation claims data.

Data analysis may also turn up some surprising trends, such as a sudden rise in non-occupational back injuries among employees who do not have physically demanding jobs. Without a direct link to a work-related risk, an employer would not likely investigate the reason for this upward trend to determine whether the cause of the injury relates to an aging workforce or injuries that occur at home, such as while shoveling snow. Even without a specific cause, however, the case can be made for a wellness program. The bottom line for employers is although an incident may have happened outside of work, there are still opportunities for the employer to promote prevention, influence healthier behaviors and mitigate risk exposure.

Using absence management data to reduce risk exposure requires going beyond basic tracking of incidence rate, illness classification, duration and cost. While many employers can access this information internally or with the assistance of an insurer or TPA, it can be challenging to identify trends and create programs to facilitate health and wellness. Specific absence data pertaining to location, department, job and employee population requires interdepartmental (human resources, employee health, risk management and safety) review and communication.

Health risk assessments (HRAs) are another source of data. Although the benefit of HRAs has been debated, particularly regarding the quality of the data, they can be a valuable tool for employers to identify prevalent health risks among a specific group of employees.

Once risks are identified and targeted, the next step is to measure the effectiveness of health and wellness programs and other interventions. Taking a risk management approach leads to greater discernment in designing and evaluating programs tailored for a specific employee population. Far less effective is rolling out off-the-shelf offerings or taking a shotgun approach to offer a variety of programs in hopes that something will be relevant to employees at risk for illness recurrence or re-injury.

For example, a carrier or TPA may recommend a cardiac wellness and disease prevention program. The incidence rate at a particular company may be too small, however, for that initiative to have significant impact. Instead, employers need to identify specific risks confronting their employee populations. In-depth analyses of absence data will yield risk exposures based on the employee demographics, population, occupations and environment.

A Multidisciplinary Approach

Historically, managing employee absence was handled according to benefit programs, with workers compensation functioning separately from short- and long-term disability. When programs operate in a vacuum, companies cannot gain from the shared experience and best practices.

Bringing the disciplines together allows for the open discussion of trend data as well as the methods for promoting employee health, wellness and productivity. For example, at one employer, bringing together multiple disciplines to address employee absences resulted in a policy to provide information on the Employee Assistance Program (EAP) to every employee who was out of work, whether due to an occupational or non-occupational illness, injury or disability. Letting employees know about the EAP and the confidentiality of the program helped provide support for those who would most likely benefit, regardless of the reasons or contributing factors connected with their absences.

Although approaches and programs differ, disciplines from disability management and occupational health to risk management and safety are unified by common goals: to reduce the risks posed by injury and illness and improve workplace productivity. By examining the risks that are common to all, greater cooperation and collaboration can be fostered, resulting in reduced exposure to the rising costs of absenteeism and a healthier and more productive workforce.
Lisa Scotton, RN, CDMS, COHN, CCM, CPDM, is a commissioner of the Certification of Disability Management Specialists Commission, a nationally accredited organization that certifies disability management specialists, and disability management operations leader for Hewitt.