As we’re leading up to NWCDC we wanted to reach out to some industry thought leaders who will be featured at the conference to see if we could pick their brains a bit. For those of you attending, these posts might give you a taste of what you will experience at the event. We hope that they will also be able to shed some insight on the “goings-on” in comp for those of us who are unable to attend as well.
Today we’re talking to Joe Picone, who will be a speaker at NWCDC and who was also a Risk and Insurance Power Broker and Responsibility Leader this year. He is the Claim Consulting Practice Leader of North America at Willis and has been in comp for 24 years.
WCInsights: Let’s start out with an easy one- where did you go to school and what did you study?
JP: I went to Albright College and had always been intrigued by medicine, science and law so I started out pre-med. After 2 years with respectable grades, I decided I didn’t want 6-8 more years of school and I switched to Finance.
WCInsights: How did you find your way into comp?
JP: I interviewed in March of my senior year with 5 major insurance carriers and about a dozen financial services firms, landing at least a dozen job offers. As the stock market had crashed in the fall of 1987, I figured that no one would buy stocks from a 22 year old kid, I decided to lean towards working for an insurance carrier. I chose PMA (now One Republic) because of the culture of the company, and willingness to let me “find myself” in the organization before placing me into an actual role. During PMA training, I spent time with underwriting, risk control, sales, and claims. I was drawn to claims and WC because it was a blend of utilizing medical terminology, law and financial skills….something that has made my career in WC claims rewarding each day.
WCInsights: Can you give us a brief overview of your career so far?
JP: In my 6th year at PMA, I was working on large accounts like Tastybaking and PECO Energy. Then, a broker met me during a claim review and eventually offered me a job. Wanting to expand my horizons, I accepted a job with Hobbs Group. I ran the claim operations at Hobbs, which was later acquired by HRH. I was appointed leader of the claim operations at HRH, and then several years later Willis purchased HRH. With Willis, I was appointed the Chief Claim Officer. In 2014, I accepted a position to build out our advanced Consulting Services as the National Practice Leader for Claim Consulting. I recently got my 20 year service award from Willis, but it’s really been 3 distinctly different brokerage employers which each have offered me rewarding challenges. I’m a lucky guy, worked for 3 different brokerage employers, but never left a company!
WCInsights: Can you describe what you do now?
JP: Today, I’m focusing on providing the most sophisticated claim consulting services available. I’m responsible for Willis’ services in Claim Closure Solutions, Medical Cost Containment Strategies, TPA Selection, Claim Audits, and Strategic Risk Planning. I’m also involved with many of our largest clients, helping them mitigate their WC exposures.
WCInsights: What are you most proud of in your career so far?
JP: I feel that people have to be good and lucky to be in certain roles. To have held 3 major broker claim leadership positions before I was 42 years old is pretty unthinkable. I never thought I would have achieved that (that’s where I believe luck has something to do with success). I was proud to be named to Risk & Insurance’s 2014 Power Brokers and a 2014 Responsibility Leader. I hope that my proudest moment is yet to come!
WCInsights: Where do you see the comp industry headed in the next few years?
JP: I see a real talent drain in the most experienced WC expertise in the country. Many of the great mentors and “legends” in WC are retiring and it’s going to be a real void on the industry. I know many TPAs/Carriers are having a hard time finding high level account managers that can provide consultative advice to a client and interact with a C-Suite. Brokers typically hire the most experienced WC experts, thus, brokers will be challenged to replace their retiring WC claim experts.
Hopefully, we’ll see the industry try to be “more sexy” to applicants. I still can’t grasp why our industry can’t have offices or cultures like some of the .com companies? We need to realize the next generation loves technology and we need to build our claim technology around the next generation culture. Why can’t a claim system look more like Facebook? Why can’t we use a mobile device to enter claim updates on a file? Why do we have mundane offices with rows of partitions and fluorescent lighting? Why can’t WC claimants have an app fully explaining their claim, rights, procedures, etc.? Creativity is severely lacking in our industry.
I also see a slant to more WC law changes favoring the employees. We’re seeing a major political shift in this country and that will certainly provide more benefits/entitlements/rights to the employee. It’s not meant be political, but within 5-10 years, at the current pace, the WC system will feel the pressures/effects of our changing political environment.
WCInsights: What are you speaking about at NWCDC?
JP: I’m speaking on “Managing the Costs of Medical Cost Containment and Cost Control Services”. This was not an easy presentation to compile. I reached out to many of the carriers/TPAs/vendors, “How do you measure this particular part of your service?” and they were very cooperative in helping me build the presentation.
We look at the medical costs of WC claim as onion, each time you pull back a layer; there are more and more layers. Everyone comes to our clients with a “better mousetrap”, but how is a client truly to measure the impact a single provider can achieve?
We’re also going to talk about how ALAE has risen by 200% over the last 20 years, yet medical costs have still increased by 300%. There are reasons for that which we’ll cover.
Lastly, we’ll talk about how to make sure the “QB”, the adjuster, should be measured on how to maximize all of the tools within their organization. We need to realize that the “QB” calls the plays and should be held accountable to maximize the benefits of all the tools and their disposal and minimize the costs of claims.
WCInsights: What do you hope attendees will take away from your session?
JP: I hope they’ll ask their brokers and carriers/TPAs for more justification on the results they are being promised for medical cost containment services. I want them to walk away with an enthusiasm to start measuring “more slices of the onion” and stop fixating on the “entire onion”.
WCInsights: What are you personally excited about for NWCDC?
JP: Hugging my clients…they work so hard and often we don’t get the chance to socialize in a non-office setting. My schedule is now fully booked with TPA/carrier meetings, RMIS demos, sessions, meals, etc.; however, I just can’t get enough of spending time with our clients in such an entertaining city.
WCInsights: What challenges do emerging, complicated and costly treatments, like surgical implants, bring to comp? How can claims operations efficiently handle these implants, or other complicated challenges?
JP: I think the best way to deal with many of these issues is through legislation. We’ve seen business groups and carriers changing the laws on physician dispensed meds, opioids, and compounded medications. I don’t see why we can’t effectuate change in the same way. I was in a meeting with the Chief Claim Officer of a major insurance carrier a few years ago, he explained that when they see an issue, their leadership says, “OK, we have a major issue here, go change the law.” I really like that attitude…if you can’t fight the law, change the law.
WCInsights: What other things do you think are lying “under the surface” when it comes to comp?
JP: I still think there is a real lack of measuring outcomes and establishing Key Performance Indicators. Vince Lombardi said, “If you’re not keeping score, you’re practicing.” So many companies/carriers/TPAs are not keeping score or not keeping score properly, they can’t really effectuate change and drive improved results. You’d be surprised how many Fortune 1000 employers are fixated on secondary metrics like PPO penetration rate, Bill Review Savings, 24 hour contact, etc. These are all secondary metrics which really have no direct bearing on a company’s WC results.
WCInsights: How can we be better prepared for these things when they do start to play a role in comp?
JP: We have to see things before they start to play a role. If you wait until a trend is here, you’ve already lost your opportunity to maximize your impact. I think more benchmarking is needed among employers. I’m not talking about numbers either. I’m talking about Risk Managers strategizing with other Risk Managers to get solid benchmarks to best practices within each other’s WC processes. If one Risk Manager is dealing with surgical implants, they certainly have knowledge to share with another Risk Manager who is just starting to see this trend occur. This is true benchmarking.
WCInsights: What kinds of things are essential to a successful claims operation?
JP: Strong Leadership. Every well run claims operation starts with strong leadership. We need more “A” players to work within our industry. Steve Jobs believed that “A” players hire “A” players. “B” players hire “C” players, “C” players higher “D” players and so on. It’s essential for claim leaders to hire the best people, train them, develop them, and create a culture where a first job in claims is not a stepping stone, but a career.
I think dedicating ample resources to R&D (Resources and Development) is essential. The WC process is ever evolving, become more complex each day and our industry does a woeful job in being reactive as opposed to proactive to industry trends. Some of the best carriers/TPAs realize this and are constantly conducting studies, developing new services/products, and training their associates/clients on how to address merging trends. Compared to other industries like technology and life sciences, the R&D budget for those in the WC industry is miniscule.
Thanks Joe- and for our readers attending NWCDC be sure to check out his session on Wednesday of the conference from 2:30-3:45.