5 Industry Challenges Identified at SAWCA 2022
The SAWCA Annual Convention provides a rare opportunity for the workers’ compensation community to interact with workers’ compensation regulators and judges. Safety National’s Mark Walls provides his takeaways from this year’s event.
August 1, 2022
Each year the Southern Association of Workers’ Compensation Administrators (SAWCA) Annual Convention provides an essential setting for conversations to occur between regulators and other workers’ compensation stakeholders who seek to improve the industry.
Mark Walls, Vice President of Client Engagement at Safety National, attended the event while also moderating the Regulator Roundtable and served as a panelist on the Industry Roundtable session. He provides his main takeaways from the event.
1. Broader Acceptance of Technology
Several administrative changes were temporarily adopted during the pandemic because of logistical challenges related to remote work and government building closures. Many jurisdictions found these technological adjustments to be much more efficient and cost-effective, so they have been permanently adopted. These changes include:
- Virtual pre-hearings and mediations
- Virtual audits
- Use of video conferencing
- Settlements submitted online versus in person
Virtual pre-hearings and mediations can significantly reduce litigation expenses, as lawyers were billing a lot of “windshield time,” driving back and forth to attend short hearings.
2. Judge and Regulator Retirements
There continues to be significant turnover among regulators and chief judges due to retirements, with several more expected in the next two years. Since last year, there have been new lead workers’ compensation regulators in Tennessee, Florida and Kentucky and a new chief judge in Mississippi. Their state’s governor appoints many workers’ compensation regulators and judges, and with the upcoming elections, there may be further regulator changes due to the election of new governors.
3. Concerns About the Quality of Claims Adjusting
In the Regulators Roundtable session, several regulators expressed concern with adjusters having insufficient knowledge of their jurisdictions, leading to inappropriate payment benefits and premature termination of benefits. Their concerns also included the volume of complaints received regarding the poor response times from adjusters, which they noted has become increasingly worse over the last two years.
While many states continue to allow their employees to work from home, at least in a part-time setting, this group recognized that adjusters working from home might not be receiving sufficient training and supervision. Like the rest of the industry, this was a necessary concession to assist employee retention, but further discussion around productivity monitoring may be required.
4. Medicare Challenges
Many states have workers’ compensation medical fee schedules tied to Medicare reimbursement rates. Medicare policy changes can lead to unexpected consequences in these fee schedules. As a result, regulators and payers will need to follow these issues closely to understand their effects.
5. ESG’s Growing Impact
Environmental Social Governance (ESG) has become a more significant issue for carriers’ government affairs teams as certain states request ESG data and mandate specific standards of conduct. This can prove challenging when states are in conflict with these standards. For example, one state will encourage carriers to cease investing in and insuring fossil fuel companies, while another state will mandate that these industries must not be treated differently.