Experience 2013: A preview of Rite Aids session
The RMIS as claims administration tool: The Rite Aid Experience with Aon risk management software as robust claims handling application
At the upcoming Aon eSolutions 2013 Experience Conference in Atlanta, I'll be joining Rite Aid's Jason Heffleger, manager of Business Analytics for the Risk Management department, to lead a session focused on using RiskConsole for day-to-day claims administration.
Only a handful of RiskConsole clients currently use Aon's risk management information system for intensive claims handling; however, as the Rite Aid story will demonstrate to attendees at Jason's session, all it takes is some configuration work and attention from the data services team to make Aon risk management software into a highly serviceable claims administration tool.
I recently spoke with Jason about what he intends to cover in his session, including how Rite Aid came to use RiskConsole for claims administration; specifics of their usage; applicability to other RiskConsole clients; and results to date.
Please tell us a little about what you plan to cover in your session at the upcoming Experience Conference.
Jason Heffleger: I plan to discuss Rite Aid's experience of moving the administration of general liability and druggist liability claims in house and how RiskConsole helped us successfully make that move. Risk managers don't always think of risk management software as a viable option for heads-down claims administration, but for a little more than a year now, it has worked nicely for us.
Here's the background: Until about a year ago, we contracted with a third-party administrator to handle our general liability, druggist liability and workers compensation claims. We determined that, based on annual handling fees, it would be more cost effective to bring GL and druggist liability claims administration in house. (Largely because of the unique state-by-state statutes around WC claims, we elected to continue with a TPA handling our WC claims.)
Bringing GL and druggist liability claims handling in house has been a very successful undertaking. We now have 15 adjusters on staff, and were increasing the scope of claims we administer internally (WC excluded).
Let's start at the beginning of the claims administration process itself. How does RiskConsole fit in with Rite Aid's incident intake procedures?
Jason Heffleger: The way that incidents are reported hasn't changed, although we have made some significant efficiency improvements to the process. Both now and prior to using RiskConsole for claims administration, store employees reported claims of any kind to a third-party call center over a toll-free line.
Call-center representatives ask a defined set of questions that determines the kind of claim and the type of information to be gathered. An incident report is generated, which becomes the basis of a claim record.
Where we've made some major strides, however, is in how the intake information is populated within RiskConsole. As part of the process of moving to claims administration in RiskConsole, we set it up so that the data collected by the call-center representative is automatically routed into RiskConsole. Before this new RMIS software, the call center provided our TPA with a PDF document with all of each day's incident information in it; the TPA then manually keyed that data into its claims system.
The efficiencies and resulting cost-savings from moving to automatic population of data within RiskConsole have been substantial. What's more, incident information is populated throughout the day, which makes for faster attention to claims and potential claims. And every morning, our claims supervisor runs a list of all claims reported the previous day, which speeds up the assignment of follow-up tasks to adjusters.
Please tell us about some of the things Rite Aid has done to make RiskConsole into a robust claims administration tool.
Jason Heffleger: We added a lot of new fields into the new claim record within RiskConsole. We created two separate sections: one for litigation and one for supplemental data, where we track a lot of details that we can run reports from and query.
We also made some custom configurations to RiskConsole that have helped us accommodate our new workflows. For example, we set up security around users so that each adjuster sees only the claims assigned to her or him; however, users can also have read-only access to claims assigned to their fellow team members. That way, in case someone is out of the office, another adjuster can read the notes and assist if necessary. Weve also incorporated security groups for user payment authority and reserve authority.
There's been a lot of interest in your session from other RiskConsole clients already. What kinds of clients do you think will find your session of interest?
Jason Heffleger: I don't think it's unique to retail clients, or unique to any particular industry. I think any RiskConsole user with a dedicated in-house claims-handling staff could benefit from this session. Organizations considering bringing some or all of their claims handling in house could learn from this session, too.
Will you be discussing some of the business value Rite Aid realized from bringing GL and druggist liability claims handling in house?
Jason Heffleger: Yes. The biggest value has been cost savings. By using RiskConsole and bringing adjusting staff in house, weve seen a large cost reduction versus the fees we used to pay the TPA.
Secondly, it makes a difference to have an adjuster who is a Rite Aid associate call a claimant about a slip and fall, a mistaken prescription and so forth. People seem more receptive to getting a call from an actual Rite Aid associate, and this has helped us keep our claims costs down because we can settle claims more quickly and at lower cost.
And finally, were seeing some positive changes in our trends around reserving. We're only a year into this, so we haven't seen a concrete impact on the actuarial side, but as time goes on, I fully expect we'll be able to officially reduce our actuarial numbers as our claims costs continue to go down and we establish a solid record on which to base consistently lower reserves.
Doris Roldan is an account executive with Aon eSolutions, based in the New York City office. Please email Doris at doris.roldan@aon.comdoris.roldan@aon.com.
