Absence Management

The True Value of Modified Duty Off-Site Return to Work

Will Blake
The True Value of Modified Duty Off-Site Return to Work
Reading time 6 Mins
Published on Nov 5

In an increasingly competitive business environment, companies are continuously searching for ways to control costs and improve their bottom lines. With an estimated total cost of over $161 billion, nonfatal workers’ compensation claims can have a devastating impact on any company. In 2017 alone, workplace injuries led to 104 million lost work days and approximately $51 billion in lost wages and productivity. With such a high price tag, it’s important that employers do everything in their power to help injured workers return to work as quickly as possible.

While safety and accident prevention programs remain the most effective way of reducing the total number of injuries, creating an effective return-to-work program is the best way of containing costs and improving recovery outcomes when injuries do occur.

Why Businesses Need a Modified Duty Off-Site Return-to-Work Program

Return-to-work (RTW) programs are designed to help injured workers return to the job as soon as possible in temporary light- or modified-duty roles, in accordance with any restrictions noted by the treating physician, until they can return to their full-duty positions. For some employers, on-site RTW programs can seem cost-prohibitive or unrealistic, especially in cases that require special accommodations or workstation modifications.

Modified duty off-site (MDOS) programs, like Sheakley’s, provide employers with access to a national network of non-profit organizations and temporary, conveniently-located off-site assignments that can accommodate nearly any work restrictions. Utilizing an MDOS program allows employers to reap the financial benefits of RTW programs without the need to make special arrangements at their place of business, saving them much-needed time and capital.

The financial benefits of an MDOS return-to-work program go far beyond eliminating the need for in-house accommodations. Let’s take a closer look at some more ways that these programs offer true value to businesses.

Significant Reduction in Claims Costs

Studies have shown that the longer an injured worker is out, the less likely they are to return to full duty. In fact, after only 12 weeks, the likelihood of return drops to only 50%. The longer an injured worker remains outside the workforce, the more expensive the claim becomes. The early intervention of a RTW program is linked to positive recovery outcomes, a faster return to work, and is key to successfully minimizing the costs associated with injury claims.

By working proactively with medical providers, RTW specialists can transition an injured worker back into a light- or modified-duty assignment before their waiting period ends. This keeps a claim medical-only and, by eliminating indemnity payments, can significantly reduce the cost of the claim. A study published in the Journal of Occupational & Environmental Medicine tracked a return-to-work program over a 10-year period. In that time, lost-time claims decreased 73% and total workers’ compensation costs fell 54%.

The following is an actual cost savings analysis, provided to Sheakley’s RTW program specialists by a national insurance carrier, for a non-litigated case in which an employee suffered a shoulder injury and was offered a modified duty off-site return-to-work solution.

MDOS Table










By utilizing Sheakley’s off-site RTW option, this employer was able to cut the costs of the claim by almost 80%. The savings provided by an MDOS return-to-work program are undeniable.

Lower the Impact of Injuries on Experience Modification Rate

Workplace injuries not only have immediate financial costs, but the effects they have on a company’s experience modification rate (EMR) can reverberate for years to come, causing significant increases to future workers’ compensation premiums.

Each company starts with an experience modifier of 1. This number fluctuates based on the frequency, severity, and cost of the company’s claims compared to the overall industry. Companies who are average for their business class remain at an EMR of 1. If a company has a better than average record, their EMR will decrease, resulting in lower workers’ compensation premiums. However, if a company’s claim history is worse than average, their EMR will increase, causing workers’ compensation premiums to increase.

Another important point to consider is that not all claim costs affect the EMR equally. Claims that remain medical-only are discounted by 70% when applied to calculations, while lost-time claims are calculated at 100% for the first $5,000. Costs over $5,000 are discounted. Employers should strive to keep claims medical-only by returning injured workers to the job as soon as medically possible, avoiding lost-time altogether.

RTW programs provide the cost-saving strategies needed to minimize the impact that injuries have on their EMR and workers’ compensation premiums.

Reduce the Likelihood of Litigation

The longer an injured worker remains out of work, the more likely they are to seek legal counsel and pursue litigation. A study conducted by the Workers’ Compensation Research Institute found that employees were 2 to 3 times more likely to pursue litigation when they felt their job security, income, or medical treatment were jeopardized. Research has also shown that the majority of claims involving litigation result in higher settlements, with the average settlement being $21,800.

One of the aims of RTW programs is to avoid litigation altogether. Employees who return to work quickly and have a positive experience with workers’ compensation and return-to-work processes are as much as 50% less likely to pursue litigation. By proactively communicating with employees and offering pathways to aid in recovery and return to full duty, MDOS return-to-work programs show injured workers that their company is invested in their wellbeing.

Even in cases where settlements are pursued, employers who show good-faith efforts to provide reasonable, light- or modified-duty alternatives are viewed favorably. This is especially true if the injured worker rejects the modified-duty position, as was the case in New York in 2011 with Browne v. Medford Multicare. The workers’ compensation board ruled that the claimant, in rejecting the light-duty offer, had voluntarily withdrawn from the labor market and therefore had no basis for a lost-time claim.

What’s the Bottom Line?

By providing accommodations for nearly any work restriction, lessening claims costs by as much as 80%, improving EMR and future premiums, and reducing the likelihood for litigation, the financial benefits of a modified duty off-site RTW program offer a compelling strategy for businesses struggling to control their workers’ compensation costs and retain experienced employees. By becoming involved in the recovery process from the earliest stages, these programs provide employers with a mechanism to ensure the most positive outcomes for their injured workers, while simultaneously guaranteeing legitimate cost-containment solutions.

Sheakley’s Modified Duty Off-Site Return-to-Work program specializes in finding light, or modified-duty solutions for clients across the country. Utilizing a national network of nonprofits and state-of-the-art technology, Sheakley is able to identify assignments that meet an injured worker’s specific medical restrictions and are convenient for their location. With an average placement time of 24 to 48 hours and an overall success rate of 99%, Sheakley’s program sets the industry-standard for excellence and a commitment to results.

To learn more about the true value of Sheakley’s Modified Duty Off-Site return-to-work program or to schedule a free, no-obligation consultation, contact us today.

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