AI Delivers 10 to 15 Percent Work Comp Cost Savings

AI’s impact on workers compensation is becoming increasingly important. A report by Deloite suggests that the predictive analytics in workers’ comp alone can deliver a 10 to 15 percent reduction in claim costs. Several software companies and a state rating bureaus have been taking advantage of AI to develop products in the areas of safety, claims processing, fraud detection and claims administration.

Safety
According to the CDC (Centers for Disease Control and Prevention), researchers from the National Institute for Occupational Safety and Health (NIOSH) together with colleagues from the Ohio Bureau of Workers’ Compensation (OHBWC) used auto-coding to determine the cause of 1.2 million workers’ compensation claims. The claims were placed into one of three broad categories: (1) ergonomic related; (2) slips, trips, and falls; and (3) all other categories combined. The number of records auto-coded in the study surpasses all other similar studies. What took the revised computer program less than 3 hours to finish would have taken 4.5 years to manually code at an average manual coding rate of 2.2 claims per minute.

These results are being used to prioritize prevention and research efforts by industry using ergonomic or slips, trips and falls intervention strategies. The research prioritized 267 industry groups by cause of injury for both lost-time claims and total claims. Additionally, using these data, NIOSH has prioritized NIOSH-funded research to a greater degree of precision, which can maximize impact. The data were also recently visualized in a dashboard that was published online to improve access and encourage further exploration.

CompScience is a commercial entity that also reduces claims through analysis of large databases. It recently partnered with Nationwide and Swiss Re “to underwrite, bind and service workers’ compensation policies.”

CompScience’s Intelligent Safety Platform, according to Josh Butler, Founder and CEO, CompScience, “has been shown to significantly reduce claims through actuarial analysis. CompScience detects previously unreported workplace risks by analyzing existing workplace videos with an ever-expanding library of proprietary computer vision models built to detect 50+ behavioral and environmental hazards.”

Claims Processing
One company, CorVel Corporation of Fort Worth, Texas, explains how using generative AI technologies enables workers comp claims adjusters to:

• Automate tasks to reduce the need for human intervention and speed up the claims processing cycle. For instance, generative AI can summarize medical documents, extract keywords, answer specific questions, and bring overlooked items to the attention of adjusters or nurses.

CorVel also uses AI technologies to learn from past claims and generate added information that matches established patterns, thereby reducing the workload of claims administrators and enabling faster claim closures.

Fraud Detection
CorVel uses AI to analyze claim data to identify potential fraud cases by detecting patterns and anomalies.

Montana-based AI insurance software provider, WaterStreet Co., builds Microsoft OpenAI’s language model GPT into its products, which its DEO Gregg Barrett, says is particularly useful in fighting fraud. It can “analyze vast amounts of claims or communication data, spotting patterns and inconsistencies that may suggest fraudulent activity,” he said told Business Insurance.

Claims Administration
CorVel uses AI-powered chatbots to enhance customer service and engagement by answering queries and providing support throughout the claims process. For example, they can offer a claim overview, explain benefits, and provide status updates using natural language processing.

Interestingly, the impact of using AI goes beyond its immediate beneficial effects by also creating a better working environment. CorVel points to how its services also help increase the retention of valued employees by making their work more meaningful and person-centered, boosting job satisfaction and engagement.

For more information or help, contact the Insurance professionals of EPIC’s CRA ProRental™ Insurance Program. Call us at: 800.234.6363 or email us at prorental@epicbrokers.com.