What Is Integrated Disability?

With companies like MetLife and Travelers working together to create programs such as their trademarked Synchrony, the concept of integrated disability is gaining wider acceptance, though there are still hurdles.

Integrated disability means combining the administration of the disability component of workers’ comp and the disability programs in the benefits arena. The following are some of the issues that Integrated Disability aims to address.

• Increased complexity of dealing with leave regulations at the federal level, including the Americans with Disabilities Act and Family Medical Leave Act — as well as regulations on state and municipal levels where there are at least 500 different regulations in all.
• Inconsistencies in leave policies on the workers’ comp side and the human resources side, exposing employers to audits and fines.
• Reductions in lost time— Absentee rates declined by 10 to 25 percent when employers implemented integrated disability management programs, according to a white paper by Sedgwick Claims Management Services.
• Administrative cost savings — when data is analyzed collectively, better preventive programs can be designed.
• Opportunities to combine initiatives that improve overall employee health while reducing workers’ comp incidents, such as health screenings and education, smoking cessation programs, health interventions, and even cooking classes with suggestions about how to prepare simple, healthy meals.

What seems like a good idea in concept, though, has been difficult to put in practice mainly because of organizational silos, according to Tim Rarick, vice president of product strategy and solutions at Phoenix-based Matrix Absence Management Inc.

"Employers are required to have work comp coverage, so it is viewed as an insurance program and tends to fall to risk management. Disability is viewed as a benefit and part of compensation packages. There are two different buyers and two different mentalities, and because of this disparity, their focus tends to be different," Rarick told Business Insurance magazine.

One of the silo issues that’s always been troubling for employers is that occupational injuries and non-occupational injuries are treated differently, eliminating the opportunity to reduce overhead costs by managing medical claims as a single process. But while the concern applies to workers’ compensation medical claims, disability claims are a different matter.

Some employers are realizing that compliance is better addressed when the silos come down and disability is integrated, even if there are some hurdles. "It’s a very painful process trying to get everybody to work together," said Terri Rhodes, CEO of San Diego-based Disability Management Employer Coalition, to Business Insurance. "In the current environment, FMLA [applies to benefits administration] and ADA applies to workers’ comp claims, so it’s important if they are not integrated programs that they all communicate with each other. The [U. S. Department of Labor] and [U.S. Equal Employment Opportunity Commission] don’t care about organizational silos.” If they are integrated, though, they will communicate as a single voice.

Aside from compliance issues, the real benefits of integration can occur when workers’ comp and disability programs work together to prevent injuries, improve medical outcomes and reduce costs.

"One of the things most people don’t notice is the impact wellness and health plans can have on workers’ comp," points out Matt Sears of EPIC Insurance. Smokers, people suffering from obesity and stressed workers in general have a higher risk of being injured at work — and these kinds of people also incur higher costs when they are injured on the job. Taking a holistic approach just makes more sense. It’s not only a more productive and efficient approach, it’s also less stressful for employees.

"It’s really taking an employee-centered position, not a company- or department-centered position, which is the way it used to be," said Ms. Rhodes.

For more information on how your firm can take a more integrative approach to disability claims, please contact the Insurance professionals of EPIC’s CRA ProRental™ Insurance Program. Call us at: 800.234.6363.