international directions in compensation scheme management cam mustard achrf 2012
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7/17/2019 International Directions in Compensation Scheme Management Cam Mustard ACHRF 2012
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Dr Cameron Mustard
President, Senior Scientist, Institute for Work & Health
2nd Australasian Compensation Health Research Forum
November 8-9, 2012, Auckland New Zealand
International directions in compensation schememanagement
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Institute for Work & HealthWho we are and what we do
Independent, non-profit research institute
in a Canadian province of 6 million workers
Multi-partite Board of Directors: labour, employer, research, and
government insurance agency
Established in 1990
Research on the effectiveness of prevention, treatment and return-to-work
in work-related disorders
Commitment to knowledge transfer and exchange
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Outline
1. Overview of some trends in the burden of work disability
2. The impact of the global financial crisis
3. Directions in compensation scheme management
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Common ChallengesDemographics Aging workforce, linguistic plurality
Nature of Work Globalization, Industrial restructuring
Disability Type Slow onset, non-traumatic injury and disease
Emerging multi-cause conditions (cancer, stress, soft tissue)
Challenges in prevention, recognition, attribution and treatment
Provision of Care Timely access to care, cost of medical innovations
Integrating prevention and disability management of soft-tissue injuries
Developing evidence-based approaches to return to work
Customer Service Developing service culture, retaining skilled staff
Internal change management
Meeting needs of small business
Technology Technology and data solutions to simplify claims processing, track
trends, access information and services
Accountability Development and tracking of performance measures
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Work disability prevention & return to work:the past ten years
Increasing adoption of disability management return-to-work
programs in medium and large employers, generally supported by
organized labour
Active case management services amongst insurers of
employment-based long-term disability plans
Adoption of case management by workers’ compensation boards:
•coordination of workplace accommodation
•resolution of delays and obstacles in clinical careSignificant information technology investments to support case
management services
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Black C. Working for
a healthier tomorrow.
Secretary of State for
Health, Secretary of
State for Work &
Pensions. The
Stationary Office.
March 2008.
What keeps people out of work?A portrait from the United Kingdom
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Work disability due to back pain, Netherlands, 2002-2007
Lambeek LC, Van Tulder MW, Swinkels ICS, Koppes LLJ, Anema JR, Van Mechelen W. The trend intotal cost of back pain in the Netherland in the period 2002 to 2007. Spine; 2011;36 (13): 1050-1058.
T o t a l d a y s o f s i c k l e a v e
( m i l l i o n s )
N
u m b e r o f w o r k e r s o n s i c
k l e a v e
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Trend in total cost of back pain in the Netherlands, 2002-2007
Lambeek LC, Van Tulder MW, Swinkels ICS, Koppes LLJ, Anema JR, Van Mechelen W. The trend intotal cost of back pain in the Netherland in the period 2002 to 2007. Spine 2011;36 (13): 1050-1058.
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Trend in total cost of back pain in the Netherlands, 2002-2007During the period 2002-2007, sick leave among workers with back pain
decreased by 25%, and the number of people receiving a disability
pension because of back pain decreased by 26%.
Total cost of back pain in the Netherlands decreased from €4.3 billion in2002 to €3.5 billion between in 2007. Indirect costs made up 87-89% of
total costs.
Findings from this study suggest that the decreasing indirect costs of
back pain in the Netherlands are the result of social security and health-
care system reforms:• changing the reimbursement of interventions within the Dutch public
health insurance system ,
• requiring practitioners to respect evidence-based practice guidelines
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Trends in sickness absence, Great Britain, 2000-2009
Linaker C et al. The burden of
sickness absence from
musculoskeletal causes in Great
Britain. Occupational Medicine. 2011
Doi:10.1093/occmed/kqr06110
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The burden of sickness absence from musculoskeletalcauses in Great Britain
Estimates based on information provided by surveillance schemes
and publicly available datasets on sickness absence due to
musculoskeletal disorders
Self-reported work-related illness survey module of the Labour Force
Survey, initiated in 1990.
Screening question: within the past 12 months, have you suffered
from any illness, disability or other physical or mental problem that
was caused or made worse by your job
Survey responses provide a (lower limit) estimate of the burden of
sickness absence attributed to MSDs
Linaker C, Harris EC, Cooper C, Coggan D, Palmer KT. The burden of sickness absence from
musculoskeletal causes in Great Britain. Occupational Medicine. 2011. doi.10.1093/occmed/kpr061
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The burden of sickness absence from musculoskeletalcauses in Great Britain
9.26 million working days were lost from work-ascribed MSDs in
2008-2009; back pain contributed 3.5 million lost days, neck or
upper limb contributed 3.7 million lost days
A decline of 22% in lost work days relative to 2001-02, with greatest
reductions attributed to back pain (36%) and smallest reductions
attributed to arm or neck pain (5%)
The UK Health & Safety Executive estimates that 9.5 million lost
work days attributed to work-related MSDs represent a cost to
society of £8 billion
Linaker C, Harris EC, Cooper C, Coggan D, Palmer KT. The burden of sickness absence from
musculoskeletal causes in Great Britain. Occupational Medicine. 2011. doi.10.1093/occmed/kpr061
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An increasing proportion of working-age adultsare receiving disability income security benefits
Decades of advances in medical treatments and rehabilitation care
would be expected to reduce the numbers of persons who have
impairments that prevent work participation
Less and less employment requires physically exertive work
These medical and labour market trends would be expected to
reduce the incidence of disability income security beneficiaries.
The opposite has occurred.
Larkin F, Sheikh MA. Brighter prospects: transforming social assistance in Ontario. Commission for the
review of social assistance in Ontario. Report to the Minister of Community and Social Services,
October 2012. http://www.socialassistancereview.ca/final-report
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Long-Term Disability
Plans, 5.9Employment Insurance
Sickness Benefit
$1B
Canada Pension Plan
Disability
$4.1B
Veterans' Benefits Disability
$2B
Workers' Compensation
$5.4B
Tax Measures
$2B
Social Assistance
$8.1B
Employment-based
Long-term Disability Plans
$8.1B
Disability Benefit Expenditures in Canada: $28.2 B
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An increasing proportion of working-age adultsare receiving disability income security benefits
Working-age disabi l i ty pol icy today
is one of the biggest socia l
and labou r market chal lenges
for pol icy makers
OECD. (2010a). Sickness, disability and work: breaking the barriers. A synthesis of findings across
OECD countries. Paris, OECD publishing.
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2. The impact of the global financial crisis
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1,000,000
1,200,000
1,400,000
1,600,000
1,800,000
2,000,000
2,200,000
8,000
9,000
10,000
11,000
12,000
13,000
14,000
15,000
16,000
Claims Registered (Monthly) Claims Registered (12-Month Rolling Average) 12-Month Rolling Person Years
BritishColumbia2004-2010
15% reduction
in registered claimsFeb 2009 to
Feb 2010
2% reduction in
insured payroll
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There is good evidence that thefrequency of workers’ compensation
claims per hour worked declines in
recessions and increase in times of
economic recovery. Some possible
explanations are that during recessions:
• there are fewer inexperienced workers• the least safe equipment
is taken out of use
• the pace of work is slower
• workers fearing job loss
may defer filing claims
• hazardous industries experiencethe largest decline in employment
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2008-09
- 18%
Trend in compensation claims, Ontario, 2000-2011Impact of the global financial crisis
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2008-09
Claims
-5%Hours
+1%
Construction Health Care2008-09
Claims
-22%Hours
-11%
Trend in compensation claims, Ontario, 2000-2011Impact of the global financial crisis
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3. Directions in compensation scheme management
• Investments in prevention
• Accommodation of disability at work• The challenge of long-duration claims
• Measuring scheme performance: case study of benefit adequacy
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$0
$500
$1,000
$1,500
$2,000
$2,500
$3,000
$3,500
$4,000
$4,500
Ontario Germany Quebec UK BC NZ Vic
4.8%6.0% NA 4.5% 7.8% 3.3%
Total prevention expenditures per 100 employed, 2007-2008and prevention expenditures as a percent of premium revenue
7.1%
Prevention
expenditures as a
percent of premium
revenue
Total prevention expenditures per 100 employed
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Expenditures on economic incentivesPer 100 employed, 2007-2008, NA: Not available
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Accommodation of disability at work
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Overall, the beneficial effects of work outweigh therisk of work to health, and are greater than the
harmful effects of long-term unemployment, or
prolonged sickness absence. Work is generally good
for health and well-being. This is true for healthy
people of working age, for many disabled people, for
most people with common health problems and for
social security beneficiaries. Work is generally
therapeutic and can reverse the adverse effects of
unemployment.
Waddell G, Burton AK. Is work good for your health and well-being? September 2006. London,
The Stationery Office [ISBN 0 11 7036943]
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Accommodation of disability at work, Ontario
In a sample of 1,500 workers disabled by a musculoskeletal
injury in 1994, 25% of workers reported receiving an offer of
work accommodation from their employer in the first 30days following injury
In a sample of 600 workers disabled by a musculoskeletal
injury in 2005, 60% of workers reported receiving an offer of
work accommodation from their employer in the first 30days following injury
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0
50,000
100,000
150,000
200,000
250,000
1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006
Lost-time claims
No-lost-time claims
Annualchange
0.03
Annualchange
-3.7
Trends in lost-time and no-lost-time claims,Ontario, 1991-2006
Smith P, Chen C, Hogg-Johnson S,
Mustard CA, Tompa E. Trends in the
health care use and expenditures
associated with no-lost-time claims inOntario: 1991 to 2006. Journal of
Occupational and Environmental
Medicine 2010; 53:211-217.
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Trends in lost-time and no-lost-time claims,Ontario, 1991-2006
Accepted lost-time claims fell much more rapidly than no-lost-time
claims: a decrease of 46% compared to a decrease of 9%
Three potential explanations:• improved protection of workers from the risk of serious injury
• better accommodation of disability arising from work injuries
• changes in the injury reporting practices of firms
Manual coding of approximately 10,000 no-lost-time claims did not
identify a trend over time of increasing severity of no-lost-time claims.
More information on the use of modified duty practices in Ontario
workplaces would aid understanding of disability management
outcomes.
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2005
2006
Days of modified duty,
as a proportion of total disability days
34 long-term care facilities
Total disability days =
Days of compensated wage replacement
plus modified duty days
Modified duty practices:institutional long-term care600 facilities, 75,000 workers, Ontario 2005-2006
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The challenge of long-duration claims
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British ColumbiaWork-related injury
OntarioWork-related injury
QuebecWork-related injury
New Zealand All Accident Schemes
Wage-Loss Claims off Compensation at 90 days, 180 days and 365 days
Percentage of Wage-Loss Claims off Compensation
60
65
70
75
80
85
90
95
100
2 0 0 2
2 0 0 3
2 0 0 4
2 0 0 5
2 0 0 6
2 0 0 7
2 0 0 2
2 0 0 3
2 0 0 4
2 0 0 5
2 0 0 6
2 0 0 7
2 0 0 2
2 0 0 3
2 0 0 4
2 0 0 5
2 0 0 6
2 0 0 7
2 0 0 2
2 0 0 3
2 0 0 4
2 0 0 5
2 0 0 6
2 0 0 7
365 Days180 Days
90 Days
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Survey of Case Management Services for Long Term andComplex Workers’ Compensation Claims
May 2009, Seven jurisdictions:
New Zealand, Switzerland, Germany, Washington State (USA),
British Columbia (Canada), Ontario (Canada), Victoria (Australia)Survey conducted between February and April 2009, initial phone
meetings were held with key informants to clarify purpose and intent of
survey. Respondents were invited to provide additional information and
documentation to supplement survey
Draft survey results were distributed for review and comment to all
participating jurisdictions
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Survey Results: Summary Observations
Early Identi f ic at ion - A strong focus on early identification of potentially long term
/ complex claims.
Broadening Cri ter ia – A majority of jurisdictions are looking at a combination of
factors when identifying long-term/complex claims that require case management
services, including medical, occupational and psycho-social factors.
Early Interventio n – Most jurisdictions are proactively using case management
and / or rehabilitation intervention as early as possible in the claim process.
Inter-profess ion al Teams – There is a trend towards case managers playing a
central role in inter-professional, collaborative case management teams.
Tai lored s upp ort – Many jurisdictions are developing tailored plans and services
to meet individual client needs and provide strong support for pre-injuryemployers.
Strengthened Overs ight – Those jurisdictions that outsource services are
strengthening oversight of external service providers, including enhanced quality
monitoring and complementary internal skills and resources.
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Measuring scheme performance:
Case study of benefit adequacy
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Long-Term Disability
Plans, 5.9Employment Insurance
Sickness Benefit
$1B
Canada Pension Plan
Disability
$4.1B
Veterans' Benefits Disability
$2B
Workers' Compensation
$5.4B
Tax Measures
$2B
Social Assistance
$8.1B
Employment-based
Long-term Disability Plans
$8.1B
Disability Benefit Expenditures in Canada: $28.2 B
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From the societal vantage point… Do we have adequate metrics for the performance of disability
income security programs?
Can all programs report adequately on:
•on benefit duration,
•beneficiary health status and use of health services•benefit adequacy and labour market earnings
•return to employment and effectiveness of re-employment
services
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Labour market participation of persons with disability. Office for
Disability Issues, Human Resources and Skills Development
Canada, June 2009.
2.4 million working age adults with
disabilities in 2006From 2001 to 2006, the proportion of
working age adults with disability rose
from 9.9% to 11.5%
Increasing rates of disability reflect:
- aging of the population
-recognition of behavioural disorders aslearning-related disabilities
-reduction in societal stigma concerning
reporting disability
People with disabilities represent11.5% of the working age population in Canada,and the proportion is rising
4.7%6.1%
9.6%
15.1%22.8%
Numbers of persons, 000
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Long-Term Disability
Plans, 5.9Employment Insurance
Sickness Benefit
$1B
Canada Pension Plan
Disability
$4.1B
Veterans' Benefits Disability
$2B
Workers' Compensation
$5.4B
Tax Measures
$2B
Social Assistance
$8.1B
Employment-based
Long-term Disability Plans
$8.1B
Do we have adequate information on the performance ofdisability income security programs?
Good
Weak
Weak
Fair
Fair
Fair
Fair
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Adequacy of workers’ compensation benefits in Ontario
Objective: assess the adequacy of benefits provided to disabled
workers in Ontario who were awarded a permanent impairment
benefit by the Ontario Workplace Safety & Insurance Board
Methods: comparison of the earnings of claimants for nine yearsafter injury with similar, but non-injured, workers (“control groups”).
For claimants, we estimated the earnings replacement rate: the
combination of post-injury earnings and workers’ compensation
benefits compared to control group labour market earnings.
Results: Average after-tax earnings replacement rates were 99%,exceeding the study assessment target of 90%.
This is a very significant achievement in the administration of a
complex disability income replacement program.
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Examining the adequacy of workers' compensation benefits. Issue Briefing, January 2011. Institute for Work &
Health. http://www.iwh.on.ca/briefings/benefits-adequacy
Labour market earnings and earnings plus benefits as a
percent of non-injured control group earningsPermanent impairment beneficiaries (11-20% impairment)
Percent
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Summary
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Working-age disability policy today
is one of the biggest social and labour market
challenges for policy makers
OECD. (2010a). Sickness, disability and work: breaking the barriers. A synthesis of findings across
OECD countries. Paris, OECD publishing.
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Thank You!
Please contact me directly for further
information
Web site: www.iwh.on.ca
E-mail: [email protected]
Dr. Cameron Mustard
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