In insurance and sector regulation, it pays to care.
As regulators and insurers, you can influence the culture, attitudes and behaviour of work injury schemes via your approaches, communication styles, and policies and procedures. Regulators set standards through policies and expectations, and through approaches to enforcement. Insurers’ policies regarding case management, as well as their interactions with scheme participants, also influence scheme culture.
Collaboration and cooperation are needed for disparate groups to work together, yet these are lacking in many everyday interactions. This has consequences for recovery and RTW outcomes. Scheme leaders can improve collaboration and cooperation by enhancing workforce skills and scheme interactions. Persuasion, incentivisation, education, evaluation, performance monitoring, information provision and encouragement of good behaviour can all contribute.
When all players are working toward a shared goal recovery, return to work is more likely.
The Research
There has been little research into the role of regulators within work injury systems. Views of stakeholder and regulator activities suggest substantial variation across jurisdictions, with more negative views about prescriptive approaches that do not foster collaboration. However, research into the broad field of regulation notes the responsive regulation model has superseded traditional regulatory models. This flexible approach adapts based on the behaviour of those being regulated, ranging from rules-based compliance to fostering positive behaviours. It advocates starting with encouragement and collaboration, using respectful and cost-effective methods. Most people and organisations respond well to this approach, reserving punitive measures for cases where persuasion fails.
Effective regulation relies on these principles:
- Evidence-informed: Decisions are based on objective evidence.
- Independent: Trust is built on clear independence from those being regulated.
- Purpose-driven: Clarity of purpose and strong values set the regulatory tone.
- Authoritative: Regulators need appropriate powers and transparency.
- Expert: Specialist expertise and real-world understanding are crucial.
- Consultative and communicative: Effective stakeholder engagement fosters partnership and dialogue.
- Trusted and transparent: Fair rule application and transparency build trust.
- Do no harm: Transparent monitoring of changes prevents unintended consequences.
It Pays to Care highlights the critical role of insurers as policymakers and underscores the importance of research in shaping work injury management.
Insurers, especially monopoly statutory government insurers, play a pivotal role in influencing the culture, attitudes, and behaviours within work injury schemes through their policies and stakeholder interactions.
Case management policies and interactions with scheme participants directly impact the overall scheme culture and outcomes for injured workers. There is notable variation in insurers' commitment to evidence-based practices, though with an increasing focus on worker well-being.
It Pays to Care calls for insurers to invest in research to inform their policies and practices. This involves collaborating with researchers and experts to identify best practices, evaluate interventions, and drive continuous improvement. Insurers should use research evidence to develop policies that prioritise worker well-being, foster positive psychosocial factors, and mitigate the negative impact of work injuries.
Adopting a biopsychosocial approach, which considers biological, psychological, and social factors, is essential for effective work injury management. By investing in research, insurers can support injured workers, promote positive outcomes, and drive systemic improvement.
The Principles and Values of a Healthy Workers Compensation Scheme
Over the last decade, an increasing body of research has shown that proactively managing psychosocial issues and transitioning to systems that don’t themselves erect barriers to recovery substantially improves outcomes and reduces costs.
It Pays to Care calls for a collective conversation about an aligned, principled work injury management system. Regulators and insurers have considerable influence in shaping healthy schemes.
Supporting the It Pays to Care policy paper is the IPTC values and principles paper, which outlines the following principles to underpin healthy workers compesn:
- Leadership: Positive psychosocial influences are promoted in legislation, standards, culture, scheme oversight, and delivery and dispute systems.
- Collaboration: Schemes empower integration and collaboration between workers, healthcare providers, workplaces, and case management.
- Fairness: Compliance and health outcomes are enhanced by equitable, transparent decisions (which are perceived by workers as fair and just).
- Prioritised Worker Health: Treatment is evidence-based, and workers can access appropriate, timely, high-quality care.
- Active and Responsive Case Management: Individuals are supported and managed fairly, in a timely and proactive manner.
- Effective Communication: Clear, consistent communication between stakeholders improves return to work outcomes and reduces costs.
- Long-Term Thinking: A focus on long-term scheme sustainability and workforce development enables ongoing evidence-informed practice.
Action Areas
Regulators and insurers can influence positive behaviours, build trust, and foster cooperation in the sector, contributing to better return to work outcomes, through:
- Stating principles and setting clear standards. Articulating expectations and standards of service is the first step to realising such standards. These may include being fair, treating others with respect, and being reasonable, efficient, proactive, responsive, transparent, and accountable.
- Measuring claimants’ experiences. This may include gauging factors that influence recovery, return to work and scheme culture, and levels of trust between participants.
- Adopting a biopsychosocial approach to the management of claims. The regulator can, through articulating, modelling and incentivising appropriate behaviours, embed an approach that aligns with the evidence on the biopsychosocial determinants of health.
- Proactive and transparent sharing of scheme data. If improvements to scheme operation are to have their intended effect, they must be underpinned by an accurate, widely shared understanding of scheme performance.
- Prioritising Stakeholder Engagement. Collaboration is more likely to occur when stakeholders and scheme participants feel they are heard, and their needs are being addressed. Effective engagement may include a stakeholder strategy, targeted outreach, or conferences/meetings that bring different scheme participants together.
- Avoiding unnecessary delays and harmful practices. Workers who experience a work injury can suffer further harm through the myriad of claims procedures, medico-legal investigations, dispute processes and surveillance that can hinder recovery. Areas of particular harm include initial claim notifications and unnecessary disputes.
You can find more information on action areas for regulators and insurers in It Pays to Care: Bringing evidence-informed practice to work injury schemes helps workers and their workplaces.
You can read more about the principles and values for a healthy workers compensation scheme in the It Pays to Care Values Paper.
References
These are indicative references only. For complete reference list, please see the It Pays to Care policy paper.
- ACCC. What does it mean to be a 'world class' regulator? ASEAN – OECD Good Regulatory Practice Conference 2015. 2015.
- Ayres I & Braithwaite J. Responsive regulation: Transcending the deregulation debate. Oxford: Oxford University; 1992.
- Braithwaite J. Types of responsiveness. In: Drahos P. Regulatory Theory: ANU Press; 2017.
- Edwards B & Bacon D. Initial customer contact – how harnessing the power of behavioural science, data and analytics can drive better outcomes for the injured. Actuaries Institute; 2021.
- Loisel P, Durand MJ, Baril R, Gervais J & Falardeau M. Interorganizational collaboration in occupational rehabilitation: perceptions of an interdisciplinary rehabilitation team. J Occup Rehabil. 2005; 15(4): 581-590.