What Is A Good Experience Modification Rate?

As stated above the Experience Modifier can be managed and reduced.  And, as I detailed in a blog post (Is Your Bad Experience Modification Rate Really That Bad?), small improvements accelerate the reduction of your debit EMR (over a 1.00) toward a 1.00.  This has to do with the fact that an Experience Modification Factor is a not an average but, rather a distribution like the Bell Curve from statistics. 

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You can read more about this in the linked blog post.  But, keep in mind that as you take small steps to improve your Experience Modification Rate you will build momentum and accelerate the descent of your Experience Modification Factor toward a 1.00.

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The suggestions below are meant to provide you tools that deliver the quickest and easiest results.  Upgrades to your overall safety management program help create lasting success but won't begin to impact your Experience Modifier Rate until 2 renewals from when you initiate your upgrades.  And, these upgrades won't fully reveal their benefit to your Experience Modification Factor until 4 renewals from now.

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• Independent Audit To Reduce Your Current And Prior EMR Rates

Independent audits can have an immediate impact on your current (and prior) Experience Modification Rates.  This is really important for clients who are faced with rising premiums and a tough renewal.  Also, maybe more urgent, some may losing revenue with Experience  Modification Rates over a 1.00 because their relatively high Experience Mod is preventing them from bidding on work.

 

An EMR Rate contains a lot of data; claims, payroll, and classification codes.  There are NCCI manual rules, Independent Rating Bureau manual rules, and state regulations that all impact and possibly change how data is to be reported.  And, there are all kinds of special circumstances, like acquisitions or sales of businesses and divisions, that further complicate manual rules and regs. It really does take an expert to properly review an experience modifier.

 

Due to the fact that our success in identifying errors in Experience Modification Rate calculations is so frequent, we do not charge for our time.  Only results.  Not only is an audit the fastest way to obtain Experience Modifier improvement, but it is also the most cost effective.

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• Reserve Audit To Reduce Your Current And Future EMR Rates

 

Reserve auditing is an important way to proactively manage your current and upcoming Experience Modification Rates.  The goal of a reserve audit is to identify open claims with reserves that appear suspiciously high and negotiate more favorable reserves.

 

If successful negotiating lower reserves, you may be able to reduce your current Experience Modification Rate and you will decrease your upcoming Experience Mod; directly reducing the cost of your renewal premiums.

 

Reserve auditing is something that requires claims handling expertise.  Cytron Group LLC can definitely perform a reserve audit for you.  Depending on your brokerage firms' claims advocates and their backgrounds, you might be able to have them perform this for you.  But, if you want to guarantee yourself a robust, comprehensive claims reserve audit, don't take any chances and engage an expert.  Click on the "Reserve Auditing" link above for more details.

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• Injury Triage Service To Reduce Future EMR Rates

 

Implementation of an Injury Triage program will help you reduce your Experience Modification Rating 2 renewals from now.  And, Injury Triage is an inexpensive service that almost always returns an impressive ROI.

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The Benefits that Telephonic Injury Triage customers enjoy include:

·       Reduced Claims Frequency

·       Reduced Claims Severity

·       Reduced Costs

·       Reduced Litigation  

·       Reduced EMR Rates

 

Without going into too much detail here, Injury Triage is a preclaim service to help employers make good decisions about what to do when one of their employees gets hurt. It is beneficial for any injury that is neither an obvious band-aid/self-care incident nor an obvious emergency requiring an ambulance.

 

The benefits include reduced number of claims and appropriately guiding injuries that do require medical attention to the proper level of care (e.g. clinic vs emergency room).

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• Workplace Safety Programs To Reduce Future EMR Rates

 

Introducing new safety programs or making existing programs more robust is a sure way to reduce future EMR Rates and keep them low.   Not only do safety programs reduce Experience Modification Rates, workplace hazards, and employee injuries, but also help improve employee morale and sense of wellbeing.

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Employee safety programs have been documented by OSHA to reduce claims expenses and employee illness by up to 40%.  A company that has an effective workplace safety program in place can help lower their EMR rate. Workplace safety programs help to eliminate workplace hazards and reduce employee injuries and accidents. The Occupational Safety and Health Administration (OSHA) shows that employers who establish employee safety programs can reduce costs related to injury and workplace illness by up to 40%. Businesses who implement a return to work program could also see their EMR Rate reduced.  Feeling safe at work can also improve loyalty to the employer.

One thing to remember is that the claims and payroll "experience" from your current policy period is not included in your upcoming, renewal NCCI Experience Modification Rate.  Not until the following Experience Mod will the current term appear for the first time.  So, any action you take now toward improving safety won't begin to positively impact your Experience Modification Rate until 2 renewals from now.