West Virginia Offices of the Insurance Commissioner 2009 Annual ...

Claims Services Division
The Claims Services Division is comprised of twelve workers’ compensation claims specialists
whose primary duty is to assure proper management of the legacy claims of the former Workers’
Compensation Commission, also known as the “Old Fund.” Furthermore, oversight is provided in
regards to the West Virginia Uninsured Employers’ Fund (UEF), which came into existence on
January 1, 2006. In part, oversight is provided by conducting audits relative to quality claims
processing and their compliance with statutory and regulatory provisions. There are multiple other
internal controls for which this Division is responsible to assure proper management of these claims;
for example, the aforementioned bi-annual audits that are conducted on-site, on-going quality
assurance reviews, large loss review staffing with each TPA, indemnity payment approval threshold of
$25,000.00 or greater, and the settlement initiative.
During FY 2010, the Claims Services Division continued to assure the injured workers received
medical and indemnity compensation in regards to their compensable injury by the three TPAs, on
behalf of the Offices of the Insurance Commissioner (OIC). The old fund claims continue to be
administered by three independent Third Party Administrators (TPAs): Sedgwick Claims Management
Services, Wells Fargo Disability Management, and American Mining Claims Services. At the end of
November 2010, we will have concluded the third contract year for each of the TPAs.
To provide some statistics, on December 1, 2007, the OIC officially began managing 47,000+
active old fund claims. Since that time, through proper claims handling utilizing industry accepted
standards and a focused settlement initiative, approximately 48% of the active caseload has been
closed. Active claim counts as of June 30, 2010, are as follows:
Counts Sedgwick Wells Fargo American Mining Totals Reduction
1/31/2008 39,227 4,750 3,984 47,961
6/30/2008 25,484 3,455 3,792 32,731 31.75%
6/30/2009 22,425 2,894 3,237 28,556 40.46%
6/30/2010 19,837 2,373 2,814 25,024 47.82%
OFWC Total Active Claims
50,000
40,000
30,000
20,000
Jan-08
Jul-08
Jan-09
Jul-09
Jan-10
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