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| Jay Vandergrift
October 2, 2009 at 1:14 am
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| CEO Wellness Coaches USA Bluebell, Pa. Making wellness convenient, relevant and very, very personal pays off for employees and employers alike. Workplace wellness programs are an emerging trend in the national effort to lower healthcare and workers' compensation costs by encouraging workers to make lifestyle changes that can help improve health and prevent injuries. But Jay Vandergrift said many workplace wellness models simply do not work. The problem, he said, is that most consist only of wellness information and/or periodic telephonic wellness coaching that results in only 10 percent to 20 percent employee participation at best and does not usually lead to any actual health or safety behavior changes. He thought he could do better. But how? "Jay came from a background where he provided rehabilitative therapists on-site," said Gene McGuire, one of Vandergrift's business partners. "He helped companies contain costs by providing therapy on-site. "And while people were in rehab, they asked questions about health--how to lose weight, how to stop smoking, how to handle stress. He thought, 'This system is great for people who are injured,' " McGuire said. " 'Wouldn't it be great to help prevent illness and injuries, too?' " And so Wellness Coaches USA was born. It took Vandergrift, who is CEO, four years to perfect the model. Today, Wellness Coaches USA provides face-to-face, personal wellness coaching and mentoring on-site to businesses that include the likes of Conway Freight and Merck. Vandergrift said the system consistently gets the job done, with 80 percent or more employee participation and 20 percent decline in costs associated with new injuries. "Most people don't change behaviors just because someone wants them to or because they're offered an incentive or even a disincentive," McGuire said. "But we've discovered that personal coaching drives behavior changes. It doesn't matter what industry they're in--people don't want to be told how to live their lives." Wellness Coaches USA sends professional wellness coaches right to the workplace to engage employees personally. The wellness coaches--exercise physiologists or trainers--are from the client company's region and are skilled in Wellness USA's proprietary wellness process. It starts with a series of on-site meetings with employees to explain the process, figure out what kinds of schedules and programming are appropriate and when it would be best for coaches to be at the site. Conway Freight has 400 people in one facility, so Wellness Coaches USA held seven or eight meetings so people could attend one at their convenience. During the rollout meeting, employees are given a health risk assessment--a pencil-and-paper instrument--which is confidential. "We get 90 to 100 percent participation in this," said McGuire. "The key is that the client introduces us as a resource, a benefit."
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| James Iervolino
October 2, 2009 at 1:14 am
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| Vice President of Risk Management and Insurance Wyndham Worldwide Parsippany, N.J. Jim Iervolino is pushing the IT envelope with a reporting system worthy of an underwriter. It started out simple enough. James Iervolino, vice president of risk management and insurance at Wyndham Worldwide, wanted to develop a Web-based site where he could get a handle on incident reporting. From there, this system--officially, the online incident reporting and loss prevention system, or OIRLPS--has grown into a risk management phenomenon. It is now capable of handling workers' comp and general liability claims-reporting and all necessary OSHA filings. Soon, it will house property information for every one of Wyndham's facilities, including valued secondary characteristics, and will be able to capture live safety data. The 700-plus internal users, from Wyndham association members, corporate board members, and resort owners and managers, will be able to generate reports about claims, about particular insurance coverages, about basically anything they could need. "It's just overwhelming the information in there," said Mary Whitten, one of Iervolino's brokers at Stephens Insurance. To get this scale and flexibility, you'd have to look at an insurer, or buy it from a broker. "I haven't seen a client do it. Not this system," said Paul Augello, senior vice president and Iervolino's casualty broker at Aon. "(It's) almost like an insurance company system in a client's office." "The system is like it incorporates his head and his mind for whoever is using it," added Augello. A scary thought perhaps, but really, it makes sense for a risk manager to want to ensure that the claims and underwriting processes work as he wants them to. With claims, by ensuring that the process works in real-time, efficiently, with a three-point contact. With underwriting, as Whitten explained, the system delivers "everything underwriters need to see." "One of the things that jazzes me about what we do and how we do it," Iervolino said, "is the ability to be an open book to the underwriting community." For Iervolino, the system started out of necessity, trying to devise improvements to an incident reporting system. And from there, every other problem he faced also seemed to fit as well. Sure, he enjoys the fact that this system will not tie Wyndham to any broker down the road. But the process has also been about his tenacity. "He takes a problem and breaks it down very mechanically and very specifically and tries to fit it into a solution," explained Augello. Or as Whitten put it, "He just wants to be the best at everything. That's just the way he is."
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| Robert Johnson
October 2, 2009 at 1:14 am
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| Managing Counsel McDonald's Corp. Oak Brook, Ill. Robert Johnson delivers "visionary" leadership for McDonald's workers' comp program. Robert Johnson had been cruising along in the legal department at McDonald's Corp. For five and a half years, he handled customer claims and litigation and had "a really wonderful experience doing it," he said. But then he realized that the company was spending $50 million on workers' compensation without having any centralized leadership. So Johnson took it upon himself to put a team together to tackle workers' comp, even though he had no experience in the field. "He had to work his tail off and learn," said Christopher Curl, the assistant vice president at TPA Gallagher Bassett Services Inc. who works closely with Johnson. It was a "step of faith" for the managing counsel to take on the task, said David Whitehurst, senior partner at Whitehurst & Cawley and outside counsel for the global fast-food giant, as Johnson was changing the way things had been done for half a century, spending money that had never been spent before, at an organization with 2,000 corporate stores (and as many as 40,000 stores in the overall system). Talk about pressure. In doing so, Johnson has tackled one of McDonald's biggest issues: getting injured employees back to work. Disability days went from 35 per claim at the start of 2008 to 21 days and dropping. About 40 percent of medical claims have been eliminated. But besides numbers, his biggest success must be that he's earned the respect and trust of McDonald's senior management, operations and employees at counters around the country. Johnson's acquaintances credit his commitment and his hard work (it's taken five people to replace him at his old job by the way). Curl called him a "visionary" who is constantly looking for new ways to do things.
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| Pandemic Business Interruption
October 2, 2009 at 1:14 am
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| With B.I. coverage triggered only with a property loss, institutions find a way to protect themselves even when no property is at stake. Chicago is the biggest small town in the country, a place where people can rely on their neighbors. And so it was when the Educational & Institutional Insurance Administration, an association of 233 Protestant colleges and universities, needed coverage in case one of its member institutions had to close because of violence or an outbreak of illness. No such coverage existed in the market; business-interruption insurance is triggered by a property loss and would not apply if students and faculty had to stay off campus. After a search by EIIA, the Hays Cos. brokerage came calling after EIIA's property business and were offered the challenge of pandemic coverage. Hays is based just a few blocks from EIIA in the heart of downtown. "First, we came up with a general outline of terms and took that to the market, along with some prices," said Kerr. "It was such a large potential loss that most underwriters had shied away from this type of coverage in the past, but we put the client's specifications into a document that made it easy for carriers to size up loss versus probability." Berkshire Hathaway agreed to write the coverage with an unusual three-and-a-half-year term to spread the premium over a manageable period for the insureds, which are the 128 members of EIIA. "Carl Hahn, our senior vice president wrote the policy, and Jim Finch worked directly with the underwriters to get agreement on triggers and prices," said Hays account executive Georgia Olsen. "But the major factor was input from the client." Mary Ellen Moriarty, vice president of property and casualty at EIIA, said her advisory council came up with the idea after one member institution, Ferrum University in Ferrum, Va., was approached by its municipality about being a possible quarantine site for the avian flu in 2005. "Bobby Thompson, the risk manager at Ferrum, called me to ask if his business-interruption insurance would cover him," said Moriarty. "I checked and told him no, but to ask if the city would indemnify him," she continued. "He checked, and they said no. So we took the problem to our advisory council. Soon after that, the shooting took place at Virginia Tech, and we realized that there were many hazards that could shut us down without a property loss. It could be a global pandemic, or a campus incident, violence, contamination or food-borne illness."
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| Arthur Seifert
October 2, 2009 at 1:14 am
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| President U.S. Risk Underwriters/Lighthouse Underwriters Dallas Grabbing the hottest trend in healthcare--medical tourism--and taking out the "what-if." The typical underwriter, if there is such a person, tends to be conservative, said Lorna Greenwood, Program Manager at US Risk Underwriters, headquartered in Dallas. "The stereotype is someone who sticks to what's been done in the past," she said. Her boss, Arthur Seifert, is anything but stereotypical. "He's very creative," she said. "He looks at trends. That's extremely rare in this business." Looking at trends and developing products where insurance could play a part is a big portion of Seifert's job. He created Lighthouse Underwriters, an operating division of U.S. Risk, for just that purpose. It and he have developed several "firsts" over the years--the first package policy for assisted living and the first package policy for the staffing industry. Now Seifert has developed and launched MedTour, a suite of products for one of the hottest trends in healthcare--medical tourism, the phenomenon of seeking medical procedures abroad. Reports containing medical tourism statistics vary. Some put the number of American patients seeking healthcare abroad as high as 750,000 in 2007 and an estimated 1.8 million in 2008. Others put it at less but still significant. The market currently is valued at $20 billion annually and predicted to generate $100 billion in revenue by 2012. The primary destinations for U.S. patients are India, Thailand, Mexico, Costa Rica and Singapore. Savings vary worldwide and by procedure, but in general, patients can expect rates 25 percent to 75 percent less abroad compared with the United States. "I've been tracking medical tourism for two years," Seifert said, "and the thing that occurred to me was, if we could produce insurance that would cover medical complications ... something that took the 'what if' out of medical tourism, it would help medical tourism grow." After all, he said, a major hip procedure could cost some $40,000 in the United States, compared to $7,000 in India. "But the problem inherent in people traveling overseas for medical treatment is--what happens if I return to the States and a medical complication develops? All the savings realized by less expensive overseas medical treatment could be lost. "So we developed MedTour, a comprehensive medical complications and travel policy." "The industry itself is in the early part of its evolution," Seifert said, "but it's here to stay. There's no way that the U.S. medical system can ever compete with India or China when it comes to costs." The MedTour product itself covers medical complications that might develop. Also available is professional liability for facilitators. The most innovative component of the product is MedTour Professional Liability for Employers, which is designed specifically for employers who want to give their employees the option of getting medical services abroad. --By Julie Liedman
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| Responsibility Leader: John A. Martin
October 2, 2009 at 1:14 am
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| At the same time that the big money men on Wall Street resumed their multimillion dollar bonuses, John Martin, chairman of Pension Benefit Insurance Services Inc., came up with a way to protect the little guy who may have seen his 401(k) retirement account reduced by half. Martin pointed out that, in this difficult economy, it's common for employees to borrow against a pension account. Then the worst happens--death or disability--leaving the spouse or the employee without retirement savings. Martin's solution is fairly simple. An insurance product would pay the balance of any loans outstanding on a 401(k), for example, if the employee died. Or, in the case of a disability, it would cover monthly loan payments for as long as the employee is disabled. The idea is innovative in its simplicity and "responsible" to its clients, who are the "little guys" who may well be human fallout from a far bigger financial catastrophe.
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| NOTHING LIKE IT
October 2, 2009 at 1:14 am
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| "You can't find anything else like this out there," said Derrick Johnson, a director in trade protection services at UPS Capital. Demand for the product in certain industries is "absolutely huge," he said. Since 2008, UPS Capital has added more than 500 Flexible Parcel Insurance customers and has experienced nearly 20 percent growth. The program generated more than $5 million in annual premium in 2003. By 2008, that had grown to more than $50 million in annual premium. The product is offered through UPS Capital, an insurance subsidiary of UPS created in 1999. The unit focuses on mitigation of supply chain risk, specifically transportation risks and risks associated with the movement of goods and movement of money. The program assesses the likelihood of a package failing to arrive on time and the impact of the delay on the customer. In many cases, it's not only the potential loss of the goods themselves, but also the potential for litigation, reputational damage and other replacement costs. UPS Capital, which also acts as the broker for the product, then crafts a flexible solution designed to meet the needs of each customer and each type of shipment. The coverage is underwritten by AIG and ACE, and the premiums are typically very affordable because delays that result in a loss are actually infrequent. "The rate of loss was so small that the insurance premium could be much less, so it was affordable for them to buy," Robinson said. But for those times when there is a delay resulting in a loss, the insurance makes a significant difference. --By Patricia Vowinkel
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| John A. Martin
October 2, 2009 at 1:14 am
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| Chairman Pension Benefit Insurance Services Inc. Sparta, N.J. Burned by incidents in the past, John Martin found a way to prevent retirement misfortunes from happening to others. John Martin left his job with JPMorgan Chase in 2001 to pursue an idea for a new insurance product that would help protect the retirement assets of "the little guy." Over the years, Martin, now the chairman of Pension Benefit Insurance Services Inc., has seen just how easy it was for "the little guy" to lose everything due to a sudden financial crisis. Two incidents in particular shaped his thinking. The first was the death of his father and the forced sale of the Texas cattle ranch where he grew up. It was the early 1970s and Martin, who was 28 at the time, had been in the service and had just resigned his commission. He had hoped to take over the ranch after his father's death. The bank demanded repayment of the mortgage and, unable to do that, Martin was forced to sell the ranch into a bad real estate market at a low price. "That's where I first started to see first hand that survivors often don't have a lot of options," Martin said. The second incident was in the 1980s when he was working at Hudson Valley Financial Services, where Martin had been hired by Manufacturers Hanover to start an insurance unit. Hudson Valley was a joint venture of Manufacturers Hanover and Monarch Capital. It fell apart when Monarch declared bankruptcy and Manufacturers Hanover merged with Chemical Bank, which then purchased the assets of Hudson Valley as well. The bankruptcy of Monarch Capital had a devastating impact on the retirement plans of many employees, who had been forced to invest in the company's stock. Martin, who was a senior vice president and chief marketing officer at Hudson Valley at the time, knew that some employees had taken out loans against their retirement plans and were then forced to repay those loans in spite of the collapse of their retirement assets. Those incidents, and others like them, inspired Martin to use his insurance expertise to find a way to protect the retirement assets of nonhighly compensated workers (those earning less than $105,000 annually). Those who are highly compensated typically have other assets to draw on in a crisis. It's those lower down on the totem pole who are often in a bind. In difficult financial times, for instance, nonhighly compensated workers are sometimes forced to take out loans against their 401(k)s. They then repay those loans through paycheck deductions. If the employee dies or becomes disabled, the surviving family members may not be able to repay the loan and this can result in a forced distribution, which then triggers tax liabilities. By the time the loan and the taxes are paid out, there may be little or no pension assets left for the worker or the beneficiaries.
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| NO SOFTWARE DEVELOPER
October 2, 2009 at 1:14 am
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| "Event management is no different than claims management," said Finley. "I'm not a software developer, I am a risk manager, so I wanted to be able to track events easily by customizing input screens in STARS." He prefers the term "event" to the term "incident" because often an instance of bullying or threatening might not rise to the incident level. School districts are required to report other high-risk events such as cases of child abuse; however, there is no mandatory requirement for reporting threats of violence or suicide. which makes it more challenging to achieve adoption of an optional system. "We do a good job of responding in the schools to events, but we have not done a good job of tracking them," said Finley. "So I ginned up a little input screen in STARS." Some people had been using spreadsheets to try to track events, he noted, but that is static, little better than recording things on paper. He added that even the spreadsheet efforts are isolated. "For the most part keeping track of troubled children is a matter of memory." A teacher knows what goes on in her class, but not necessarily what happens at lunch or gym. "We are trying to manage the latent risks," Finley said. "We are trying to identify the kids that make threats or are actually violent, and put associated data with that. It's so much easier than trying to compile paper files." --By Gregory DL Morris
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| Walter D. Kerr
October 2, 2009 at 1:14 am
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| President & CEO Hays Cos. of Illinois Chicago
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| Michael Pugaczewski
October 2, 2009 at 1:14 am
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| President M. Adams & Associates Inc. Middletown, N.J. Company president solves a messy problem for the heating oil industry. The heating oil industry hasn't always had the cleanest reputation, mostly due to the occasional bad publicity resulting from leaking underground tanks. Real estate agents and attorneys don't do much to help the situation either. A warranty helps to solve one aspect of the problem but tank remediation is a messy process, not to mention it costs the big bucks and it's a pain in the neck for the homeowner. Oh, and the environment gets a bit polluted too. Michael Pugaczewski, president of M. Adams & Associates Inc., based in Middletown, N.J., has come up with a solution that not only helps the homeowner but has changed the way the residential heating oil industry approaches the problem of underground storage tank leaks. Prior to Pugaczewski's program, a leak would mean removing the underground tank and replacing it with a basement or above-ground tank--an often unnecessary step that encouraged the negative attitude toward oil heat. It didn't help that volumetric or hydrostatic tank tests used to monitor the condition of the tank are expensive to perform every year. What the industry needed was a way to monitor the tank soundness, track its deterioration and uncover a signal when the tank has truly reached the end of its useful life so that it could be removed before a leak--all this combined with a warranty triggered if the tank leaked during the monitoring period. Well the industry had come up with a partial solution. The heating oil industry worked with the National Oilheat Research Alliance to develop the ChekTank program, a peer-reviewed process to determine if the underground tank had expired. ChekTank offered neither liability protection for the provider nor remediation protection for the homeowner, however, if the tank leaked while being monitored. Pugaczewski and his firm found a way to enhance the ChekTank offering by combining it with a warranty and a newly developed provider policy that included liability protection and pollution coverage. Homeowners now have the ability to use their heating oil tanks to their full life with the peace of mind that the chance of a leak in an underground storage tank will be significantly reduced. If a leak does happen, it will be discovered sooner--sometime within a 365-day period--which will lessen the severity of the leak. A future buyer of the home will then have the option to transfer the program. But if they insist on a test to determine the tank's condition, the seller won't have to worry about a potentially costly leak that could affect the sale of the home.
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| BROAD IMPORT
October 2, 2009 at 1:14 am
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| Lives are at stake too, said the scientist, who's worked with General Motors Corp. to cut the risk of fire in cars and trucks. More often than not, the difference between life and death is only a matter of minutes. "If people can get just five or 10 minutes, then many lives can be saved," he said. FM Global began doing fire testing more than 100 years ago, so developing new standards in the middle of the 20th century was nothing new in the context of the company's fire testing tradition. With the increasing use of plastics in industry in the 1960s, and higher fire losses as a result, the research conducted by Tewarson and his team, and initiatives to better understand such losses and finding ways to prevent them took on greater urgency. As far as Gritzo is concerned, Tewarson is as deserving of attention as anyone because many of Tewarson's applications will eventually turn up in a broader range of applications--the food services industry, for example. Airlines are already benefiting from many of the researcher's discoveries as new airplanes flying off the factory lines come equipped with better fire-retardant materials inside and outside the cabin. Tewarson said his proudest innovation is probably the "clean room," so prized by the semiconductor industry. Ultimately Tewarson takes the most satisfaction out of his long research career whenever he knows his research was used to benefit people. "I feel a lot of satisfaction inside that some of my research was of some help," he said. --By Cyril Tuohy
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| ALL PROTECTED
October 2, 2009 at 1:14 am
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| Martin's idea, trademarked as Pension Loan Completion, is simply to provide insurance that would pay off the balance of the loan in case of death or pick up the monthly loan payments in case of disability. "The concept was that no pension loan should outlive its maker," Martin said. This would protect not only the employees and their families from an unexpected crisis, but also would help protect retirement plan sponsors and their fiduciaries, which incur corporate and personal liability in the administration of their pension plans, including plan loan administration. ERISA, the Employee Retirement Income Security Act, requires that the "duty of loyalty" and the "duty of care" be used as tools in the prudent administration of plans and protection of plan assets. Plans and fiduciaries that fail in these responsibilities face the risk of litigation, and fiduciary liability insurers face the risk of fiduciary breach claims. The idea was implemented by forming the firm Pension Benefit, filing utility patents on processes, trade marking the program and selecting partners with institutional credibility for implementation in the pension market. Martin compared the situation of plan sponsors to that of banks making consumer loans. Banks making loans to consumers for big-ticket items like automobiles, for instance, require the borrower to have insurance on the asset. This is a similar concept. The cost of the insurance could be picked up as a benefit by the plan sponsor or employer, or passed on to the employees, who would pay the cost through a small paycheck deduction. Martin said he has just started rolling the product out to the Fortune 1000 and is working with Aegon and Aon on the program. --By Patricia Vowinkel
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| Dr. Nathan Cope
October 2, 2009 at 1:14 am
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| Chief Medical Officer Paradigm Management Services Concord, Calif. Systematic Care Management hastens recovery from catastrophic injuries and lowers workers' compensation costs as well. Of the three million work injuries that occur annually, only about 25,000 are catastrophic. But while catastrophic injuries represent less than 1 percent of all workers' compensation claims, they represent about 20 percent of those costs. That's because appropriate management is not provided to ensure that care is expert, timely and efficient, said Dr. Nathan Cope, chief medical officer of Paradigm Management Services in Concord, Calif. Most of the cost for catastrophic injuries occurs because of complications that arise, he said, from rejected skin grafts and lumbar surgery that fails. Cope founded Paradigm Management Services some 20 years ago to change that. The proprietary Systematic Care Management procedures he designed have assisted more than 10,000 cases for more than 100 insurers, third-party administrators and employers. An analysis by Seattle-based Milliman, the actuarial firm, found that conventional cases returned to work about 8 percent of the time, while Paradigm cases returned to work 40 percent of the time. Lifetime costs of conventionally managed injuries averaged three times those of Paradigm's clients' injuries. Paradigm's typical cases involve such things as spinal cord injuries, traumatic brain injuries, severe burns and major traumas--or a combination thereof. "When you have something like a broken arm," said Kelly Wilson, chief marketing officer of Paradigm, "there are medical guidelines. But they don't exist in catastrophic cases. "With catastrophic injuries, there are multiple hand-offs," she said. "There can be five or six primary care physicians, multiple facilities and multiple surgeries. And a lot of the cost comes from complications--things like skin grafts that are rejected or lumbar surgery that fails. "The way our medical system works today is great. There are experts in everything. But what is missing is someone who looks over the whole thing."
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| Bill Hazelton
October 2, 2009 at 1:14 am
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| Senior Vice President ACE USA/ACE Environmental Risk New York ACE's Bill Hazelton gives his team enough green space with which to innovate. Under the leadership of its New York-based Senior Vice President Bill Hazelton, ACE USA/ACE Environmental has taken a broad-based approach to addressing the exposures created by the emphasis on green building in the commercial construction industry. What is referred to as ACE's Green Contractors Pollution Liability insurance solution was rolled out in April and it involves the sale of environmental insurance, yes, but it is also meant as an effort to educate and lend technical support to green-minded contractors to reduce their environmental exposures. "I want to stress, No. 1, it's a program, it's not insurance," said Gerry Rojewski, a vice president, corporate risk, with ACE Casualty Risk who worked with Hazelton in creating the contractors' pollution liability product. Builders are abuzz these days with LEED, or Leadership in Energy and Environmental Design certification, either for their buildings or their employees. The problem, according to Hazelton and Rojewski, is that few really understand what it means or have a grasp of the exposures it creates. Part of the innovation in the ACE program is that ACE Environmental is partnering with Hygienetics, a risk management consulting subsidiary of ACE's Philadelphia-based TPA ESIS Inc. Engineers with Hygienetics are able not only to provide training to companies that wish to expand the number of their employees that are LEED-certified, but can also assess the green building exposures either of a new construction project or a renovation. "There is definitely pressure whether it is renovation or new construction to build to a green building standard," Hazelton said. Adding to that pressure is the fact that there is a serious lull in commercial construction right now. Hazelton said that many of his clients are working off their backlogs in 2009, but as for how busy commercial builders will be in 2010, he issued the uncertain assessment: "time will tell." Now along comes the federal government and its $787 billion economic stimulus package, also known as the American Recovery and Reinvestment Act, which is dishing out $140 billion in public sector construction projects. As a condition of its largesse, the government is requesting that the projects it funds be at least partially built using green building elements, either recyclable or renewable source materials, or built in such a way as to reduce water and energy consumption.
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| Lisa Byrnes
October 2, 2009 at 1:14 am
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| Vice President of Risk Management Regal Entertainment Group Knoxville, Tenn. Lisa Byrnes has driven a risk management culture from the corner office down to the carpet you walk on at Regal Entertainment. Lisa Byrnes is known by almost everyone who works at Regal Entertainment Group. As she tells it, she was employee No. 1 when the company was founded with one theater in Titusville, Fla., until the owner decided he wanted an employee number and bumped her to No. 2. Since then, especially when she took on the risk management function full time in 1996, Byrnes, as vice president of risk management, has received top billing as the star of safety at the nation's largest movie theater company. With 26,000 employees at 549 theaters across 39 states, that is no small feat from a workers' comp perspective. And with 245 million moviegoers getting their tickets torn in half every year, getting safety right from a general liability perspective is a near miracle. Yet some of her most creative successes could also be seen as mundane. You see, the number of claims filed against movie theaters really took off in the last few years when stadium seating was installed in many existing and new facilities. The new stadium seating created some unique exposures from a slip-and-fall standpoint, explained Ed Williamson, executive vice president at Regal's broker, Reynolds & Reynolds, which has specialized in this sector since 1976. Byrnes drove the operational and facility side of the business to research long-term fixes: developing silver-colored handrails that stand out from the background wall color, installing new contrasting green and red LED lights along the steps, and designing a carpet that "pops out" in the light to make the steps more visible without interfering with what's showing on the big screen. It all sounds simple, admitted Williamson, "kind of one of those things like, 'Well, duh.' " Added together, these small improvements have reduced both claims frequency and severity. After the first year of installation, Byrnes said she sees a reduction of slips and falls of up to 60 percent. Overall costs drop 85 percent after that first year. "There is no other theater that did anything like that," said Donna Larson, Byrnes' customer service manager at Liberty Mutual.
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| SAFETY CULTURE
October 2, 2009 at 1:14 am
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| Yet Byrnes' story is not as simple as the plot of a Hollywood blockbuster, where the hero faces a problem and you just know she's going to win at the end. "It's quite costly to make that technology available at every theater," said Byrnes. To figure out which older facilities should be upgraded, she's been able to break out slips-and-falls by location and type of theater. Byrnes also implemented a Web-based audit process that identifies risk reduction opportunities at the 55 to 65 theaters targeted each year for improvements. As for companywide buy-in, the return on investment she's gotten from the new theater designs have done a lot of convincing. But she's always done an A-list job of making safety a priority at the company. "She was very instrumental in getting the upper management at the time to say, 'Oh yeah, we need to change our culture and make safety more a priority for the company,' " said Williamson. Byrnes has kept at the safety culture as the company has grown from one theater to 549, largely through acquisitions. She was instrumental in creating Regal Entertainment Group University, weekly classes for theater managers where risk management and culture form a large part of the curriculum. "You kind of wake them up to the safety aspects around them, things that they can do that make a difference," said Byrnes. She also created a manual and videos for new employees, many of whom are young and working at their first paying job, and she has a knack for winning over newly acquired companies to the "Regal way," according to Williamson. Perhaps her success is because she can be tough when she needs to be, yet is also one of the "most pleasant, professional people" you could work with, as Larson put it. --By Matthew Brodsky
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| Peter Kvale
October 2, 2009 at 1:14 am
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| Director, Technical Services The Redwoods Group Morrisville, N.C.
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| The Redwoods Group
October 2, 2009 at 1:14 am
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| The managing general underwriter for nearly half the nation's YMCAs reviews data and finds new opportunities for safety and risk reduction. Lifeguards at YMCAs insured through The Redwood Group are much better equipped to prevent drowning tragedies thanks to the extensive safety program Doug Page and Peter Kvale developed. This training goes well beyond CPR. Instead, the augmented pool safety program focuses on where the lifeguards are positioned around the pool, assessing how often they rotate their positions and how many breaks they take, among other factors. No radios are allowed on the pool deck. "One of the first things we did was to get rid of flexible plastic chairs because they're not at the elevation to adequately scan the bottom of the pool," said Page, senior vice president and program director at The Redwoods Group in Morrisville, N.C. Page and Kvale, the director of technical services, also scattered manikins and silhouettes on the bottom of the pool to simulate drowning victims and timed how long it took lifeguards to notice. Page said, ideally, lifeguards should react in about 10 seconds, but lifeguards at the YMCAs took about a minute or so to jump into action. So, does that training work? You bet. According to their own data, the training and influence of The Redwoods Group staff has improved operating behaviors to the point that in 2007, there were zero drowning deaths in guarded YMCA pools insured by Redwoods. That's typical of how The Redwoods Group operates--it creates a culture of safety (its company motto is "serve others") through its risk management programs, by identifying a YMCA's exposures, and instituting a loss-control program to prevent serious injuries and keep the kids, parents and staff safe. The heart of the operation is its quantitative approach to risk management. Their data-gathering is so all-encompassing and continuous that it allows Page to keep his finger pressed tightly on the pulse of the YMCA exposures by carefully examining all the data from their customers and other data-collecting organizations, such as the Centers for Disease Control and Prevention and National Transportation Safety Board. The system requires every customer to submit an incident report, no matter how large or small, from broken bones to death. "We receive over 50,000 incident reports each year," Page said. His staff analyzes all these reports, looking for trends and where they're happening. "It's very quantitative and backs up our hunches." Even after Redwoods has identified and solved a problem, they reanalyze the data. "I think it's unique for a managing general underwriter to use that (quantitative approach)," said Page. Thanks to that approach, the rollover dangers of driving 12- to 15-passenger vans popped up on Redwoods' radar screen in 2004. With 80 percent of the insured YMCAs using these vans, Redwoods saw the opportunity to avoid future liabilities. "We were the first to tell them to get out of them," said Page. Today fewer than 5 percent of YMCAs still use the vans, and the remaining Ys have plans to phase them out. The edict included a warning that Redwoods would not insure the Ys that didn't comply. Page said they only lost two clients.
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| KEYS TO SUCCESS
October 2, 2009 at 1:14 am
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| Therein lies a key to explaining his success in such a short amount of time. He grasps the "entrepreneurial culture" among the 40,000 employees and store owners/operators. Just take all the improvements in safety he's had with general liability and workers' comp. Success there comes in part from a new claims allocation program, whereby the option to make the right choices remains with the owners-operators (with incentives of course). CFO Colosi described it as a matter of knowing how to "seed" initiatives. Or as Logan put it, "(Sterling) comes from the operations side of the business, so he knows what happens in restaurants and he knows how they'll react. So he always gets their buy-in." Sterling also approaches risk management like a "student of the game" and is dogged and dependable, like the "Cal Ripken of risk management," said Logan, referring to the retired Orioles infielder who played a record 2,632 straight games. Again, if you ask Sterling about his success, he's humble and thinking of others. "Risk management to me is a noble cause. What greater thing can you do then be involved in programs that help protect your employees and guests from harm," he said. --By Matthew Brodsky
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| Maureen Burm
October 2, 2009 at 1:14 am
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| Chief Operations Officer Aon Brokerage Group Chicago
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| WALK SOFTLY ...
October 2, 2009 at 1:14 am
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| Marshall, who earned a double undergraduate major in finance and risk and insurance from Temple University in Philadelphia and an M.B.A. from there as well, is known as a soft-spoken executive who in the Teddy Roosevelt tradition carries a big stick. Doug Lopaga, senior claims consultant with Aon's global risk consulting group based in Philadelphia, said of her: "Megan and I worked together at Aon for six years. Her internal drive to do well for her company stands out. She has brought about major change in a short time at Hershey with a minimal staff--just her and one other person. But she works tirelessly. "She has made her program much more efficient," added Lopaga. "The Hershey staff at plants really rely on her. She's very thorough in what she does." "Megan treats each Hershey factory location as a customer," said Clark. "She is tenacious. She absolutely won't settle for less than perfection. When she came to Hershey she replaced somebody who had been there a long time. But that didn't daunt her." All of this has added up to some impressive results for the risk and management group since Marshall joined Hershey. Workers' comp claim management metrics: --2008: $3.7 million reserve reduction --2009 through March 31: $300,000 reserve reduction --2008 medical cost avoidance of $1.75 million by leveraging national managed care network of Sedgwick General Liability/Automobile Liability Metrics, claim management metrics: --2008: $600,000 reserve reduction --2009 through March 31, 2009: $700,000 reserve reduction In addition, noted Marshall: "Through consolidation to a single TPA we were able to reduce our service fees paid by $250,000." "We simultaneously marketed our workers' comp, general liability and auto liability programs on an unbundled basis (i.e., not taking the insurance company's claim service) and were able to reduce our insurance premiums over our large deductibles by $500,000," she also said. --By Steve Yahn
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| William Wainscott
October 2, 2009 at 1:14 am
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| Workers' Compensation Manager International Paper Memphis, Tenn. Intl. Paper switches to an owner-controlled insurance program, with impressive results. Give credit to Bill Wainscott, International Paper's workers' compensation claim manager. He's spent hours integrating his company's owner controlled insurance program (OCIP) for contractors and subcontractors, into its overall insurance and services program, effective Jan. 1 of this year. The switch to a large-deductible OCIP is projected to save $1.25 million annually for each of the next three years. "The contractors' and subcontractors' insurance costs were killing us," said Wainscott. "That's why we decided to take on the risk ourselves." Intl. Paper subcontracts much of the maintenance, retooling, installation and construction at their large mills to complete specialized, time-sensitive, high-exposure jobs. As a result the workers' comp and general liability coverage as part of the bid process was being passed directly through to Intl. Paper. Wainscott saw the opportunity to achieve more savings for the contractors and subcontractors. Working with Intl. Paper's risk management department, finance department and broker, he conducted a comprehensive underwriting and loss review. This allowed for rates to be established that were less than contractors and subcontractors were able to purchase separately. Now, when contractors and subcontractors submit their bids, an insurance cost is developed based upon the payroll, NCCI codes and past experience. The contractor or subcontractor then pays Intl. Paper, which in turn assumes all the liabilities within the deductible/retention associated with the specific job on their site. Intl. Paper purchases excess coverage to protect itself on large and catastrophic losses. In implementing this solution, the company moved oversight and claims management to the master self-insured program, which allowed the company to implement a comprehensive loss prevention program. All claims, incidents and near misses are now reported through Intl. Paper's internal reporting system, which is connected to the third-party administrator, Sedgwick CMS' claims management system. Mills now control their costs based partly on the workers' comp costs of its contractors and subcontractors. If a contractor or subcontractor has severe losses and refuses to embrace loss prevention and return-to-work programs, then the mill can save money by using a different contractor. Wainscott is quick to share credit for these monumental changes with David Arick, head of the risk management department and the rest of Wainscott's workers' comp team. "What I think is special or unique is that we found the opportunity to achieve substantial savings and actually improve performance," noted Wainscott. "The real reason for Bill's success is he has probably done a better job than I've ever seen of putting himself in another person's position," said Richard Schroder a Fort Thomas, Ky.-based area account executive for Sedgwick. "If he's dealing with his facilities he puts on their hat." --By Steve Yahn
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| Kenneth Gregg
October 2, 2009 at 1:14 am
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| Chairman & CEO CITON Group Inc. Indianapolis What's the catch? Coverage kicks in only if the damage exceeds the deductible dollar amount. For many homeowners and small businesses in Florida, the most difficult problem with property insurance isn't just the high premiums. Instead, it is the impact of the out-of-pocket cost of the deductible, if they were a victim and needed to file a claim on their property. "Over past five years, there have been a combined 7.6 million catastrophic hurricane claims on residential and commercial properties--with losses exceeding $86 million on residential claims alone," said Kenneth Gregg, chairman and CEO of the CITON Group based in Indianapolis. Especially after catastrophic hurricanes, major property insurers increased retentions or deductibles on property policies in order to shift the risk away from the insurer and on to the property owner because the hurricane losses were so huge. In a few cases, it was either the higher deductible or no coverage at all. "This particular policy fills a gap for the insured by covering 100 percent of the deductible if the damage exceeds the deductible dollar amount," he said. The policy covers wind damage, not flood losses. Homeowners and commercial property owners often don't understand how a property policy works in relation to the deductible specified in the coverage. For example, many homeowners are under the impression that the deductible is a based on the cost of repairing the damaged home. Most deductibles in Florida, Gregg explained range from 2 percent to 10 percent of the value of their property, not 2 percent to 10 percent of the damage." On a home valued at $335,100 in Palm Beach County, with a 2 percent deductible, the homeowner would need to pay $6,702 before repairs could begin. With CITON's "Zero Select" policy, the premium would amount to an annual payment of $628, or about $52 per month. That would eliminate the payment of any deductible at the time of filing a claim if the loss reaches a level where primary insurance kicks in. The newly formed company has written more than $30 million in coverage since the product was introduced after the hurricane season last year. The underlying insurer on the policy is Hallmark Specialty Insurance, an insurer rated A-1 by A.M. Best Co., and there is reinsurance on a 1-to-100 year catastrophic event. The key underwriting factors are the total insured value of the property; the property's location; whether the building is residential or commercial; the construction materials used; the size of the deductible on the primary property policy; the age of the property, and the number of floors. Hallmark is no longer writing the coverage because it had reached capacity, and another carrier with much larger capacity will write the coverage, said Gregg. The new capacity will allow CITON to offer coverage from Texas through New England. The policy currently covers all of Florida except for Monroe County, which includes the Florida Keys. A policy can also be written in conjunction with Florida's Citizens Property Insurance Corp., the nonprofit created by Florida in 2002 to provide affordable coverage. Gregg got the idea for the new coverage after a friend in Melbourne, Fla., suffered through four hurricanes in 2004. Because of the increase in value of his friend's home over the 20 years that transpired between when the home was purchased and when it was damaged, the deductible on the policy was $50,000 before any repairs could even begin ¿ on a home that had only cost $30,000.
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| EVEN MORE IMPORTANT TODAY
October 2, 2009 at 1:14 am
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| Homeowners in hurricane zones, especially in the current recession, "are challenged with enormous financial burdens and don't have that kind of money around" to pay a deductible, Gregg said. For a small business, one huge loss could jeopardize the survival of the entire organization. Zero Select does have one important shortcoming: It will only pay benefits if the damage exceeds the deductible on the primary policy. If the deductible is $10,000, but the damage if $5,000, then the policy would not pay the claim. The policy therefore works best for the policyholder as catastrophic coverage, where the loss is huge and a portion of the claim must be paid out of the primary coverage. Coverage, however, is not available for mobile homes. Gregg estimates that commercial property policies now account for more than 60 percent of the total exposure with the balance being residential. In contrast, residential policies outnumber individual commercial policies, but exposure per policy is much lower. The policy for a commercial policyholder also covers business interruption, if that portion of the primary coverage has a deductible. Implementation of the deductible program is now under way, available through independent agents. --By Jack Roberts
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| William Diaz
October 2, 2009 at 1:14 am
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| President, Client Technologies CS STARS LLC Chicago Bill Diaz sees clearly into the future of CS STARS. Risk managers with finely tuned technological antennae had for the last couple of years sensed some drift, a dulling of the lenses, over at CS STARS, Marsh's ground-breaking risk management information systems (RMIS) platform. Was CS STARS losing its twinkle in the face of aggressive competition? Not if William (Bill) Diaz, a veteran of the Marsh and CS STARS organizations, had anything to do about it. Promoted last year to the top spot at CS STARS, it was high time to adjust the team's lens barrel and focus with laser-like intensity on the marketplace. First off, Diaz slapped a pair of goggles on the system's massive database, a tool aptly named "Risk Goggles." The tool allows risk managers to access, view and interpret risk data and intelligence in the context of geography, similar to Google's popular mapping technology. "We leverage Google Earth and are kind of doing it in a format that's visually impactful," he said. With Marsh's purchase of Corporate Systems in 1968, CS STARS has more policy, claims and exposure data than any other risk management information in the world, just waiting to be mapped and presented in a visually attractive way that risk manages can understand. That's Risk Goggles. When the buzz started building about the improvements, clear-eyed risk managers had their doubts about how fast CS STARS could put a real, meaty tool into production. So, when Diaz and his team unveiled a prototype of the tool last March, some 400 starry-eyed users were stunned, responding with "Ooooohs," and "Ahhhhhs." "Speed to market is most important and I saw the power of what it could help us do," said Brent Pickens, assistant corporate risk manager of Mars Inc. "Bill was the reason behind that."
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| Robert Furtado
October 2, 2009 at 1:14 am
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| CEO LoJack Supply Chain Integrity Forney, Texas LoJack SCI's cargo tracking and recovery system is filling the holes in the supply chain. In 13 years as a senior vice president at Ingram Micro, Robert Furtado developed the company's logistics and supply chain programs. The difficulty in building sophisticated technology for the largest computer products manufacturer in the country was watching the product go out the door. "The most frustrating part for me was that, as soon as I turned it over to a carrier, I lost all visibility and control and assumed all risk," Furtado said. Perhaps that's why it's so rewarding for him to embark on his most recent venture as CEO of LoJack Supply Chain Integrity. In 2004, Furtado became a founding investor and director of a company called Supply Chain Integrity, in which LoJack began investing in 2006. Last year, the stolen vehicle recovery experts became a majority shareholder in the company, creating LoJack SCI. As a major investor, Furtado has achieved a certain satisfaction in overseeing a product that enables logistics providers to maintain control of their cargo as it moves through the supply chain. The InTransit system, combining GPS, cellular and radio frequency technology, offers covert cargo tracking with real-time surveillance and Web-based monitoring, all integrated with law enforcement for dispatch and recovery. The tracking device is typically implanted somewhere in the cargo, not in the transport vehicle. A 24-hour monitoring center keeps a close watch on the goods. "Most of the time with thefts, the cargo is long gone after the truck is recovered, and the value is worth much more than the truck or trailer," Furtado said. Success stories with the cargo tracking are compelling. In one case in Texas, Furtado said, there was a hijacking at gunpoint of tobacco products. The movement of the load was monitored, police were notified and the million-dollar load was secured in 40 minutes. In another case, a cell phone manufacturer's cargo was stolen, and when LoJack SCI helped authorities secure the valuable load of cell phones in a warehouse, law enforcement also discovered an additional $4 million worth of stolen goods and tied the thieves to organized crime in the Miami area. Dan Greenberg, new product manager at Fujifilm, is a client of LoJack SCI. Fujifilm manufactures cartridges that are used by large corporate IT data centers, which are required by law to back up data. LoJack SCI created a customized product called Tape Tracker, essentially a mock tape cartridge housing the tracking technology that fits in with the rest of the cargo being moved. "We had evaluated a couple other players, some defense contractors and other tracking companies, but no one could offer the level of customer service and real-time monitoring that was backed by LoJack," Greenberg said. Furtado said there are already hundreds of customers with thousands of devices deployed. "Most security money is spent in guarding facilities and not in the supply chain," said Furtado. "There is an increasing awareness about risk management in in-transit operations as opposed to goods sitting in a warehouse, and I'm trying to bring a higher level of protection to the part of the supply chain that is the most vulnerable." --By Erin Gazica
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| COMMUNITY KUDOS
October 2, 2009 at 1:14 am
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| Those developments get Paul kudos from the community, but the major innovation that grabbed the interest of the mainstream insurance sector was the formation in January of an independent commission of national industry experts to advise and support the all-Indian board of directors at Amerind. "We created our own regulations," said Paul. "We are unencumbered by many standard industry regulations, so we can be more responsive, but that also means that outside underwriters have not been comfortable doing business with us. We had also to be innovative to respond to the naysayers." Once the advisory commission was in place and mainstream carriers and reinsurers took note, Paul helped create a captive reinsurance company and four segmented cells. "We needed something between the risk pool and people like Munich Re or Lloyd's," he said. Mainstream insurers are most impressed by the fact that Paul lead the charge to create the first segregated-cell portfolio structure operating inside Indian Country, using the segregated-cell captive model. Each cell contains a homogenous group of similar type risks protecting tribes from a variety of exposures. Prior to this time, the Indian tribes were primarily familiar with only the traditional insurance "risk transfer" model. By introducing this alternative risk financing mechanism, Paul is credited with expanding their knowledge of innovative risk management practices and providing them with an alternative risk solution. Paul's other major accomplishment, as seen from outside Indian Country, was his ability to create a common cause among the proudly individualistic native community. "For all of the history of the tribal nations, fortunately or unfortunately, they have found it tough to trust each other," said a carrier executive who has worked with Paul for several years. "Kent has been able to get 500 of the 560 or so federally recognized tribes to solve common problems and to enable each other to solve individual problems." "Kent lives by his words and expectations," said one Amerind staff member. "He does not expect any more from us than he would from himself. He never wants the spotlight; instead, he shines the light on others. he makes us feel important and proud to be who we are. Kent shows sensitivity and respect to the native American Indian culture," while bringing to that culture the best practices in risk management. --By Gregory DL Morris
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| Douglas A. Page
October 2, 2009 at 1:14 am
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| SVP, Program Director The Redwoods Group Morrisville, N.C.
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| SATISFACTION
October 2, 2009 at 1:14 am
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| Well into the program's second year, King expressed satisfaction with the results for its pilot year that reduced temporary total disability (TTD) payments by about 10 percent. So far resistance has been virtually nil. "We have had return to work in place for a number of years so our associates are familiar with it," King said. "We are just able now to act much quicker and communicate to them much quicker." Leslie Grever, vice president at Sedgwick CMS, sees King as a leader able to grasp the big picture needed for a $76 billion enterprise with 330,000 employees, and thus deal effectively with the inevitable roadblocks that come up from time to time. "The major complications to achieving his objectives were the inconsistency of the various Kroger divisions' return-to-work practices," she said. Grever said that King's effort to have a higher level of expertise available early on in the claim is one more example of the vision needed to achieve the overall goal of lower TTD payments. "This alleviates the need for additional resources later in the claim life when warranted by the claim's need," she said. King's use of both return-to-work coordinators and certified rehabilitation counselors "reflects the same satisfaction-oriented practices that have made Kroger a leader in customer relations," Grever said. In the end, the reduced TTD payments that have resulted from the efforts of King and his team are "only a side benefit of doing the right thing for the Kroger associate." King began his effort in a rosier economic climate than exists today, and the challenge to do the right thing only increases as times get tougher. "He is asking his own employees how the stores, Sedgwick CMS and the doctors are treating them," Grever said. The surveys that accomplish this goal go to King's desk every quarter. "What Steve is determined to do is to make sure the Kroger associate is getting the right healthcare and when they are ready to come back to work, it is done quickly and efficiently," Grever said. --By Steve Tuckey
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| SYSTEMATIC
October 2, 2009 at 1:14 am
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| That's what Dr. Cope brings to the equation--a systematic scope of care, hands-on and implemented by experts. Every case has a specialist physician assigned to oversee care and coordinate medical needs over the sequence of injury and recovery. Nurse case managers work on-site with the injured person and his or her family and/or caregivers to coordinate treatment and costs. Paradigm has a vast database of medical experts from around the country who are fully versed in the latest techniques, as opposed to carriers' medical people who render decisions over the phone. "What's the good of a former OB/GYN making telephonic decisions about care for a burn victim?" Wilson asked. "We bring in experts from the leading centers of excellence who stay with the case from beginning to end. The attending doctors are very receptive to that." In addition, Paradigm bundles payments so that all payments go directly to Paradigm and Paradigm pays all the bills, including those for sometimes nonstandard but proven techniques known to produce better outcomes. For instance, family support and help, often an underappreciated aspect of care, is something that Paradigm considers seriously when developing recovery protocol. "The strength of family relationships isn't part of most doctors' records," said Wilson. "But family support isn't just a nice thing. It's a huge thing. "So if we have to fly a family member out in order to get a better medical outcome, we'll do it," she said. "No carrier will do that. "But it can reduce costs because the patient gets better faster." The innovations in care pioneered by Dr. Cope are based on the premise that when you do the best thing medically for a patient, the financial benefits will follow, she said. "People looking at healthcare reform today are looking at things he started 20 years ago," said Wilson. "No one else is doing systematic care management like this. They're struggling in group health insurance now. They're looking for ways to measure outcomes. "But we've been doing it for years. We have both medical and financial metrics for everything. And the combination makes the parts greater than the whole." --By Julie Liedman
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| Matt Hansen
October 2, 2009 at 1:14 am
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| Director of Risk Management City and County of San Francisco San Francisco Matt Hansen burnishes San Francisco's risk management platform so that the city's public authorities look presentable to the debt markets. Landmarks may belong to all, but someone has to be responsible for protecting them. Matt Hansen, director of risk management for the city and the county of San Francisco, has the unique obligation of maintaining coverage for such iconic properties as the San Francisco cable cars, Fisherman's Wharf, San Francisco International Airport, and many of the city's museums, along with the less glamorous infrastructure of a major metropolis. Hansen did not even inherit the position so he could pick up practices and policies in place. Prior to the creation of his post last year, risk management across the city was handled at the departmental level or at the level of each individual institution. Hansen's innovation was the creation, on the fly, of a comprehensive risk management operation for one of the nation's largest cities. Just for good measure, he had to do it while the state around him was sliding rapidly into insolvency. "When he started his projects in earnest there was state money, but now that is drying up faster than he can implement things," said one broker. "And there is a huge fear that the state will continue to put more pressure on the city, county and schools." The silver lining for landmarks like the Golden Gate Bridge is that "for the first time the port and the Public Utilities Commission (PUC) and other revenue-generating entities have to issue debt," said the broker. "The enterprise risk management (ERM) program is not yet required by bond underwriters, but it certainly provides them with strong assurances and a high comfort level. Matt's program is in full compliance with the new ERM standard, ISO 31000." "I don't have a baseline budget, so I have to sing for my supper," said Hansen. "I have had to educate people about ERM and about ISO 31000. But as the port and the PUC and Municipal Transportation Agency (Muni) and San Francisco International Airport (SFO) go to the debt market, they are getting ahead of the curve in risk management. Even at this early stage, we are seeing operational benefits and people are saying that we should have implemented this type of thing long ago."
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| Stephen Finley
October 2, 2009 at 1:14 am
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| Director of Risk Management Denver Public Schools Denver A risk manager pushes his RMIS to extract enough data to keep track of students in need of help or serious disciplinary attention. No organization can manage what it cannot count. That is the core belief that led Stephen Finley, director of risk management for Denver Public Schools, to do something that few are brave enough to attempt: tinker with software. Most people are happy to have their hardware and programming do most of the things for which they were intended. Not so with Finley. He needed to track troubled children not just through grades but through the entire Denver school system. The students most in need of consistent support or monitoring are also those more likely to be shuffled around, class to class and school to school. So Finley took his CS STARS software, a standard risk management information system sold by a subsidiary of Marsh, and used its modification features--parts of the program used to track claims--to track school children. Denver Public Schools serves more than 75,300 students of the city and county of Denver. The district's staff includes 4,500 teachers and 6,700 full-time employees who work out of 152 schools and administration buildings. The diversity and transience of the student population factored heavily into the need to track and measure threats of violence and even suicide. By following students through a districtwide system, prior encounters are easily seen, allowing trained district staff to have a broader amount of information to deal with students and their families who need help. "The STARS system is highly customizable," said Marla Stone, account executive for STARS. "So Stephen did not have to do any heroic custom programming, but other users tend to use the modules to do things like manage their trucks. I have never seen anything like what Stephen is doing." As a true innovation, tracking troubled kids across the entire school system using a common, comprehensive system is paying dividends and has the potential to spawn entirely new approaches to personnel risk management in the long run. "Stephen has already had cost reductions by using the system," said Stone. "Those kids who have been the victims of abuse or violence at an early age may end up as bad actors later. With the historical perspective he is getting, Stephen will be able to see those correlations." Of course, long-term vertical studies in education and other organizations are common but require a lot of funding and extensive planning by researchers. By modifying a relatively common system, Finley has made it possible for any teacher, administrator or other school-system member to enter data relevant to any event at school.
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| Richard Hildreth
October 2, 2009 at 1:14 am
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| Mayor Pacific, Wash. Local mayor draws up emergency plans, listens to outside advice, but gets out of the way when disaster strikes. Pacific is a city of just 6,000 citizens south of Seattle and east of Tacoma. Nestled amid much larger municipalities and near one of the country's largest defense contractors, Boeing, it would be easy for Pacific to mail in emergency preparedness and rely on mutual aid from its neighbors. Instead, led by Richard Hildreth, Pacific has blazed a trail in both strategic and tactical planning, training and certification for all staff. "I have worked in government for more than 20 years," said one Pacific municipal official, "and I have never seen a mayor make training such a priority for all of his managers and employees. He makes it a priority, and makes his staff available for it. There are no excuses, and he has shifted the focus of our work to make that possible. The training is really for all managers, staff, public-works employees, police, courts and to some degree the fire department." Pacific is part of a regional fire authority, so Hildreth does not have direct control. But he does sit on the board for the authority and has been able to infuse it with the same focus on preparedness and training. Many people know the hard-charger type who is good at getting the ball rolling on important programs but then bristles at any criticism or suggestion. Another type of leader wants to be at the center of everything all the time. Managers at Pacific, and Hildreth's colleagues in other regional civil service, note two rare qualities to his energy and involvement: he eagerly seeks outside review for his policies and practices, and he does not get under foot during actual emergencies. "One of the things the mayor initiated along with his leadership was a 360-degree review for all of his plans, both in development and implementation," said one of the city's managers. "He put his plans out there for regional and county partners to give input. I have never seen that before. Too often we see plans made at high levels that never get implemented," or plans are put into effect without outside input or review. In January, Pacific suffered some flooding as a swollen river overspread its banks. It was not a major catastrophe but was certainly a test both for the mayor's planning and for the mayor himself. "The city responded very well," said an emergency manager. "The mayor expected us to do our jobs, but he stayed out of the way." Hildreth was pleased with the response to the flooding, but noted that Pacific must be prepared for a worse flood. With review procedures in place, the lessons of the first flood are already being incorporated. "In writing the city's emergency plan, I noticed a disengagement among many groups, including fellow elected officials and city staff members," said Hildreth. "A city emergency management plan should not be thought of as a just a written document that outlines what to do in an emergency. I have encouraged staff to look at emergency management and our plan instead as a mind-set. The plan is not the written words, but the critical thinking that is behind those words."
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| MULTIPLE THREATS
October 2, 2009 at 1:14 am
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| Rising waters were hardly the only threat faced by Pacific already this year. Hildreth reported that during preparations for the initial wave of the H1N1 virus, each department was encouraged to look at how an outbreak might affect it. For example, if schools had to close, that would also shut the nutrition programs that operate out of the cafeterias. Contingency planning is not just what to do with students, but also how to feed people dependent on public assistance. By changing the plan from just a document into the critical thinking paths, Hildreth stressed, staff now understand not only the plan and how it is used, but also how they must respond. This same change in mind-set is also being encouraged in the city's business and residential community. Hildreth's hustle turned the traditional relationship between small cities and their larger neighbors on its head: The governor appointed Hildreth to the state's Emergency Management Council representing all state municipalities. Far from relying on his bigger neighbors, Hildreth is, in part, helping to protect them. --By Gregory DL Morris
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| Risk Innovators
October 2, 2009 at 1:14 am
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| The Risk Innovator Award recognizes individuals across different industries who have demonstrated innovation and excellence in risk management. Read all the winner profiles in the 14 categories at the 2009 Risk Innovator page.
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| David Jewell
October 2, 2009 at 1:14 am
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| Director of Risk Management PetSmart Inc. Phoenix Risk manager David Jewell's pet peeve: getting the proper amount of care to the right person. Whether it is a mom-and-pop store with five employees or a giant nationwide enterprise with nearly 50,000, getting proper care to the injured as quickly and efficiently as possible is always a priority. But in the latter case, systems and procedures using the most up-to-date technology can make or break the ultimate success or failure of that worthy goal. David Jewell, Phoenix-based director of risk management for PetSmart since 2006, recognized from the outset the need for an enterprisewide reporting system that would facilitate the efficient delivery of medical care for workplace injuries. The system he put into place puts the injured worker in immediate contact with a nurse to get the right level of care as quickly as possible without the redundant handling and needless costs that Jewell saw happening with traditional triage arrangements. PetSmart operates more than 1,100 retail outlets and nine distribution centers in the U.S. and Canada, and employs a workforce of about 45,000 people. Sedgwick CMS vice president Michelle Chambers worked with Jewell in devising the new system. "Jewell and management of PetSmart are very serious about doing the right thing for its associates in terms of medical care," she said. On a personal level, Chambers described Jewell as "decisive without being autocratic." "He is thoughtful in the manner of someone who does not take change lightly but is well aware of the potential benefits of making change when it is needed," she said. Chambers found Jewell eager to gather as much input as possible before making a decision while considering all angles of a problem. Among the problems Jewell had to consider was the fact that in the old system, the existing triage protocol also served as the intake reporting platform, which slowed things considerably. "This arrangement placed a high cost burden on the program by using clinicians to perform administrative intake tasks, and also allowed minor incidents to spiral out of control due to lack of appropriate filtering," Jewell said. Store managers completed a manual worksheet in which incident characteristics were poorly defined. "There was no data warehouse to capture reports of critical events, and the information provided to PetSmart stakeholders was minimal," Jewell said. Moreover, data was unavailable when needed at a later date to respond to lawsuits and third-party liability cases were still being reported manually using handwritten forms and fax machines to claims providers. Jewell also said that medical care was poorly managed, with associates getting not the correct amount of care or sometimes the wrong kind. "Too many self-treatable minor ailments that should have been addressed with antibiotic ointment and a Band-Aid were migrating to workers' compensation medical triage programs, as were nonoccupational health issues," he said. Oftentimes store managers were involved in authorizing and managing medical care in a manner outside their core competency and core responsibility. "This not only added to claims handling expenses for PetSmart, but additionally, there was a risk that the cumbersome process might delay care for more serious injuries," Jewell said.
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| MORE APPROPRIATE CARE
October 2, 2009 at 1:14 am
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| Under the system developed with Jewell's leadership, injured associates answer customized injury intake questions geared to accepted clinical guidelines. When deemed appropriate by the answers, the caller is transferred to a nurse for clinical consultation. Jewell said the success of the program could be seen in the fact that intake calls requiring clinical consultation have dropped by 24 percent. "The new program is driving more appropriate medical care for injured associates and reducing costs for PetSmart," he said. For Jewell, installing a risk management process and team where none existed before, and then watching accident and cost metrics improve remains his greatest satisfaction. "We have seen our safety group grow from one professional to six and seeing great integration with our store operations, supply chain and loss prevention teams," he said. Turning around any structure within a Fortune 500 company does not come without strain. "I would not call it resistance as much as communication and education challenges throughout the organization that the risk management program needed a major overhaul in terms of both cost and process," Jewell said. He added that a lack of strong risk management "had led to a culture of malaise and poor communication that took some time to turn around." --By Steve Tuckey
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| Store must defend ADA suit by employee on workers' comp
October 2, 2009 at 1:14 am
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| Exclusivity provisions in workers' compensation laws that prevent employees from suing their employers for negligence in causing work-related injury or illness do not preclude employees from being able to sue their employers for disability discrimination under the ADA or related laws.
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| Group says hospitals not prepared to protect nurses from H1N1
October 2, 2009 at 1:14 am
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| Preliminary findings of a survey of nurses at more than 75 hospitals across the country have found disturbing gaps in preparedness for responding to H1N1 and protecting health care workers from infection, according to the California Nurses Association.
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