The basics of complex claims

Article2_Circle_Rotation-768x768-150x150.jpgMost workers’ compensation claims do not start out as complex. They become complex over time due to specific drivers that increase costs and duration. Being able to recognize and resolve these drivers at the right time will help reduce a claim’s likelihood of becoming complex. Read on to learn how to recognize risk factors and pick up some tips on how you can have greater impact in changing the trajectory of potentially complex claims.


It is no secret that litigation is a key driver of claim complexity, cost and duration. A California Workers’ Compensation Institute (CWCI) survey shows:

  • Claims with attorney involvement are eight times more expensive
  • Lost time days are three times higher
  • 90% of litigated claims result in permanent impairment

Strategies and tools around litigation avoidance are critical. An injured worker can become anxious about their recovery and the ability to sustain themselves and their family. Being an advocate for the injured employee can make all the difference. Providing excellent customer service, making claim decisions faster, facilitating effective meaningful communication and following through with impactful actions will reduce litigation. Take the time to learn about the person at the heart of the claim and find ways to best address their needs and alleviate concerns. It is important to customize your approach and resources for the individual injured employee.


Another well-known cause of complexity is opioid utilization. In an interview with DMEC @Work, Dr. Teresa Bartlett of Sedgwick reported the following data:

  • According to the Centers for Disease Control and Prevention, 78 people die every day from the opioid epidemic
  • Sedgwick’s data shows that 56% of injured workers take opioids and, on average, have a 53-week increase in claim duration when opioids are involved
  • 60% of individuals taking an opioid for 90 days will still be taking them 5 years later

In response to the opioid epidemic, several states have enacted formularies, prospective utilization review, limitations on the first fill and enforcement of tracking systems like CURES and ISTOP. Sedgwick provides an effective approach through our complex pharmacy team in recognizing harmful prescribing trends and working with physicians in weaning injured workers off of opioids. These are all necessary mitigation strategies, but ultimately the best approach is to stop potentially harmful practices at the source. Initial efforts should be focused on utilizing good quality physicians and holding them accountable. Sedgwick’s provider benchmarking and search tool helps in identifying physicians we know will do the right thing by their patients. It also flags physicians that have adverse prescribing habits. We want to line up providers who share the same goal: to help the injured worker receive the best possible care and get them back to being healthy and productive.


The existence of comorbidities adds another layer of complexity to a claim. A two-year study was recently conducted by Harbor Health on injured workers with obesity, hypertension, history of drug addiction and tobacco use. It found the following:

  • Claim durations increased by 76% for claims involving multiple comorbidities
  • Incurred costs increased by 341%
  • Temporary total disability (TTD) days increased by 285%
  • Litigation rates increased by 147%, and jumped to 224% when addiction-related issues were present
  • Surgical rates increased 123%

An optimal recovery demands early intervention and a holistic approach. Coordination with clinical resources is necessary in understanding and articulating what is related to the injury, what is pre-existing and what is complicating recovery. That is why our team of experts coordinates with all stakeholders and maps out a more holistic treatment plan to secure recovery and achieve our goals.

Psychosocial issues

Much like comorbid conditions, unidentified psychosocial issues will lead to increased costs and delayed recovery. A recent study presented by The Hartford and Optum shows:

  • Duration increases 57% when the injured worker is depressed
  • 10% of claims with psychosocial issues cause 60% of claim costs
  • 97% of depressed patients have a second comorbid condition

We can best support individuals dealing with psychosocial challenges by changing our approach in helping them cope with an injury. As discussed with litigation avoidance, advocacy can have a significant impact in successfully managing their claims. Also, we need to start taking a more holistic approach and focus on the whole person when promoting a return to health. Cognitive behavioral therapy can be a useful tool. For instance, at Sedgwick we utilize the expertise of our team of behavioral health specialists, who play a key role in assisting injured workers with management of psychosocial issues and coping skills during the recovery process.

Understanding the basics of complex claims can help you in accessing the right resources to avoid or mitigate these root causes. If you have questions or comments for our complex claims unit please leave us a comment and we’ll be glad to research.

Eddy Canavan, VP, Workers’ Compensation Practice & Compliance

Read additional Sedgwick thought leader articles on complex claims in our edge magazine:

  • Aaron Bergman

    An excellent piece, Eddy. Thank you.

    I particularly identified with the first section, as it relates to litigation's role as a massive driving indicator of total claims cost on an exponential scale. In Florida, a recent decision (Castellanos vs New Door), was reversed in April 2016 and effectively removed the cap on attorney fees in WC claims filings that had been in place here since 2009.

    As a consequence, the industry has experienced a 22% across-the-board increase in legal costs during the course of the first year anniversary of this decision.

    I am presently working on an extensive piece pertaining to some potential remedies in the field available that we can look to. Among them includes a very hands-on and empathetic approach to the injured worker during the early stages of the triage and AOE/COE process.

    This struck me as similar to your assertion as it relates to doing everything possible to alleviate the injured worker's anxiety levels, wherever possible in hopes of staving off the notion that legal representation is a prerequisite for effectively navigating the WC system, in general.

    Also, having practiced in California for over 30 years, I could certainly identify with the section on psychosocial issues.

    I mention this, based on years of having also worked encountered and written extensively on the phenomenon of psychosocial issues being brought to the fore as an injured body part, almost as an afterthought, with disasterous consequences by multiple attorneys on long term CT filings with multiple body parts.

    I thank you again for this fine piece and I'll be more than happy to provide you a copy of the one I'm working on, as well, once it is completed and edited, on request.

  • William Yattaw

    If there was a way to keep the applicant attorneys out of these claims imagine the savings. Although I know it not possible. Litigation is the biggest problem,

  • Kelly Elliott

    Great piece with much needed insight. Thank you!

  • InjuryBoston

    The passage on opoids resonated with me. There's definitely an opoid epidemic going on right now in the United States, and it's definitely felt in the working sector. I actually liked how you made the point that employers should be keen on addressing this. If communities can come together, maybe a dent can be done to this problem. I'm all for it! Your other points were fairly resonate too!

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