6 Tips to Reduce Home Health Care Workers’ Comp Insurance Costs

#1 - Classify your Employees Correctly

The National Council on Compensation Insurance (NCCI) provides a classification system to help you identify the correct workers' compensation insurance for your business. Using the right class code for your employees can save you a lot of money on home health care workers' comp insurance. 

Here are some key classification issues that come up in this field: 

Standard Class Code 8835

The standard code for home health care is 8835. However, there are exceptions in Pennsylvania and Delaware, so be sure to check the specific codes for those states.

Clinics

If you run a clinic, use code 8832 as the governing class code for the entire business. This code will apply to all your employees, even if some provide in-home services. This has a lower premium than the 8835 code.

Clerical Staff

For office staff that handle scheduling, billing, and intake, use Class Code 8810. This clerical class code is significantly lower in cost compared to Code 8835, helping you save on premiums.

Owners

As an owner, you may not need to include yourself in the coverage. Excluding yourself can lead to significant savings, especially if you are providing therapy services.

For more detailed information on class codes, check out our home health care class code guide. 

#2 - Establish a Written Safety Program

Creating a written safety program is an easy step you can take, and your insurance company will often offer you a discount right away. 

Here are some things you can include in your safety program:

• Pre-inspection of Homes: Ensure each location is free from risks such as clutter that can cause trips or makes the home unsuitable for care.
  
  
• Proper Training in Lifting: Teach your home health aides and nurses safe handling and lifting techniques to prevent back injuries or strains, which are common in the field.
  
  
• Driving Record Checks (MVRs): If your employees are driving as part of their duties, verify that they have no more than two moving violations to reduce the risk of on-the-job accidents.
  
  
• Combative Patient Training: Train staff how to de-escalate aggressive behavior from patients, safeguarding their own well-being.
  
  

Keep in mind that it's important to make sure your safety program is written down and that you have a designated person in charge otherwise, it probably won’t qualify for a discount.

#3 - Implement a Return-to-Work Program

Introducing a return-to-work strategy for your home health care workers can significantly reduce workers' compensation costs. 

What does 'Return-to-Work' really mean?

A 'Return to Work' program refers to a process that allows your recovering employees to come back to work in a modified capacity. This could mean adjusting their duties so they're able to contribute to your organization without straining their health.

For example, if they can't perform their role as aides or nurses due to medical restrictions, you might have them temporarily handle scheduling, intake, or billing. 

How does a Return to Work Program lower costs? 

By allowing employees to return to work early in modified roles, you reduce the costs associated with missed wages in the workers' comp claim. This lowers the “total loss incurred” for the claim, which in turn helps prevent your insurance company from significantly raising your rates. 

Additionally, it signals to the insurance company that you are proactive in managing workplace injuries and taking responsibility, which can lead to better home health care premium rates in the future.

#4 - Formalize Your Drug and Alcohol Free Workplace Policy

Just like with a written safety program, having a formal, written drug and alcohol-free workplace policy can make a significant difference and potentially lower your costs. 

Sometimes the insurance company might offer a discount, and sometimes the state mandates one. Check local regulations or ask your agent to see if your business might qualify.

Documentation is Key

Maintain clear records, including:

• Policy acknowledgments signed by employees
• Tutorials and training completion certificate
• Documentation of any policy violations and their consequences

#5 - Lower Your ExMod

‍What exactly is an ExMod and why does it matter for your business?‍

An Experience Modification Rate (ExMod) can make a significant difference in your workers' compensation premiums. An ExMod is a reflection of your company's safety record relative to others in your industry. 

A score above 1.0 means your premiums could go up, while a score below signals you're doing better than average—translating to lower premiums.‍

Strategies to Reduce your ExMod

‍While you cannot eliminate your Ex-Mod, as it’s simply a reflection of your safety record, you do have some control here. 

The most effective way to lower your Ex-Mod is by reducing the number and severity of your workers’ compensation claims.

A formal safety program and a return-to-work program are important parts of this strategy. These programs directly lower the indemnity (payments for the lost wages) portion of the claim thus having a very positive impact on your ExMod overall. 

It's important to maintain these improvements over time. Even if your Ex-Mod is currently high, consistently applying these measures can gradually bring it down — so stay persistent!

Kickstand Note: 

Changes in your ExMod won't show up overnight. It is based on a rolling three-year period, excluding the most recent policy year, so expect a gradual but steady improvement as you implement these changes. Patience and persistence in following these strategies will lead to a safer work environment and financial benefits in the long run.

For a comprehensive overview on how to manage workers' comp for your home health care agency, check out our guide.

#6 - Ask for Credits 

One of the easiest ways to lower your rate is by asking for credits. A credit is essentially a discount on your policy.

Underwriters can often lower your rate at their discretion if they can justify it with a good enough reason, such as beating a competitor's price or recognizing your great safety record. 

Sometimes, insurance companies will offer credits just to get your business.

However, it’s unlikely they’ll do it without you asking. While getting your quote, ask if there are any credits your company is eligible for. 

Here are some types of credits you might qualify for:

Safety Program Credits: 

As mentioned earlier, having a robust safety program shows insurance companies that you're proactive about preventing accidents and can help you qualify for credits.

Drug-Free Workplace Credits: 

Implementing a drug-free workplace program, as covered in the drug and alcohol-free workplace policy section, can enhance safety and lower your insurance premiums.

Claims-Free Discounts: 

Maintaining a good safety record with no claims, as discussed in lowering your ExMod, can help you qualify for a discount.

Business Attraction Credits: 

Sometimes, insurance companies offer credits simply to attract your business.

How do you Qualify?

Contact your insurance company and inquire about available credits. Be prepared to provide evidence of any programs you have implemented. Insurance representatives can guide you on how to take advantage of these credits.

Need a tailored workers' comp policy?

If you need help figuring out which strategies could apply to your home healthcare business, so that you can save money, don’t worry, we got you! We’ll help you sift through and implement these strategies, so you can lower your workers' comp costs and improve your coverage.

Get a quote from us for workers' compensation for home health care. Your business is unique, and your insurance solutions should be too.