Recently I had the opportunity to review a set of TPA instructions. The TPA was directed to “negotiate settlements of covered claims pursuant to the authority granted by” the contracting party. No further details were provided. However, another section of the agreement spelled out in minute detail a procedure for mediation should a dispute arise between the TPA and its client. The client knew mediation was an important tool for resolving its own disputes, but provided no direction about how to use it to resolve covered claims.
The regional risk manager of one national account tried to get their local team of TPA workers compensation adjusters to try new dispute resolution techniques, but the adjusters refused. “If they want us to do that, they need to include it in their instructions.”
What Should TPA Instructions Say About Mediation?
“At appropriate milestones in the life of a claim, adjusters and attorneys should take active steps to initiate mediation and report on the results.
“These milestones include:
-Upcoming trial date
-IW has reached permanent & stationery status
-IW has reached age 61
-70% of indemnity reserve has been paid
-4 reserve changes within 2 years
-Case is more than 4 years old
“Additionally, claims handlers should attempt to close claims with mediation in:
-when the IW is acting in pro per