The Intersection of Public Sector Risk

Management Trends: Safety, Health & RiskP r e s e n t e d b y

C a r o l W i l m e s

D i r e c t o r , M e m b e r P o o l i n g P r o g r a m s

Today’s discussion will …

• Share current trends in health, safety and property/liability

• Discuss intersecting trends

• Suggest a few opportunities for collaborated loss prevention

• Introduce forecasted trends from national forums

Health care trends

• Diverse workforce – aging, retiring, and hiring millennials

• Uncertainty of regulatory environment

• Sharp rise in specialty Rx trends

• Technology advances

• Increased use of EAP services – critical incident debriefings &

general use

FIVE GENERATIONS IN THE SAME WORKFORCE BY 2020

Sources: 2020 forecast data based on Future Workplace Survey; CDC BRFSS 2012; Experian; Aon Hewitt 2015 Universe Benchmarks

1% 22%

20% 50%

7%

Traditionalists(Born 1925-1945)

Baby Boomers (1946-1964)

Gen X(1965-1980)

Millennials (1981-2000)

Centennials?(2001 or after)

Age 71 - 91 52 - 70 36 - 51 16 - 35 0 - 15

Broad Traits Loyalty,

respect for authority,

discipline, sacrifice

Competitive,

sandwiched

generation, hard

work, long hours

Self-reliance,

eclecticism, free

agents, independence

Immediacy,

innovation, freedom

of choice, cyber

literacy

Hyperconnectedness,

mobility, media savvy, life

online since preschool

Managing Life Work and Life Work/Life Balance Work/Life Balance “Weisure” “Weisure”

Tobacco Use 8.3% 18.4% 22.1% 26.5% 21.2%

Obesity Level 26.3% 33.3% 32.8% 30.9% 14.7%

Average Debt $23K $29K $30K $23K N/A

College Attendance 32% 45% 52%

Home Equity +36% compared to same age counterpart in

1984

-50% compared to same age counterpart in

1984

% College Females 42% 55% 60%

% Married in 20s 60% 20%

General Workforce

(2020)

AWC Employers

(2016) <1% 27%

34% 38%

0%

FORCES CHANGING THE FACE OF BENEFITS

In 2015, Millennials

became the

new majority

Benefits will comprise

nearly half

the average earner’s total

compensation by 2024

Willing to bear more

benefits cost for choices

that meet their needs

By 2024, benefits costs will drive net pay below CPI

for average employee

The experience counts to

new entrants

By 2018, an estimated

40 million Americans

to buy insurance on a private exchange

US Labor Force1

53.5M Millennials

52.7M Gen X

44.6M Boomers

1 As of Q1 20152 Strongly agree

Employee wants include

EmployersKnow change is needed to address

cost and new workforce diversity

but unsure of path

70%believe total

rewards strategy

must change for

2020 workforce

but

only 7%have significantly

evaluated the

impact of

Millennials

25%

CPI

15%Net compensation

after benefit costs

80%Personalized benefits

geared to circumstances

and age

40%Help in achieving

financial security

through benefits 2

>$100 billionIn recent M&A activity

Anthem+Cigna | TW + Willis | Aetna+Humana

60% Lifestyle-focusTech

EmployeesBearing more cost and risk so

want more flexibility, choice and control,

but also guidance

MarketOrganizing to deliver scope, scale and

appeal to the consumer

Looming excise tax

will minimize differentiation in

health care benefits

Colleagues with strong well-being

are more likely to be engaged in

their jobs6x

Broad range of collaborative care models;

payment reform is driving competition

and localization of health care

Medical claims trends

Top 10 Conditions

1 Low back pain

2 Musculoskeletal disorders

3 Hypertension

4 Musculoskeletal signs &

symptoms

5 Anxiety, neuroses

6 High cholesterol

7 Depression

8 Benign & unspecified neoplasm

9 Obesity

10 Skin disorders

Top 10 Claims

1 Circulatory system disease

2 Endocrine, nutritional &

metabolic disease

3 Neoplasms

4 Digestive system disease

5 Kidney disease

6 Injury/poisoning

7 Mental/behavioral/neurodevelop

8 Pregnancy/childbirth

complications

9 Infectious & parasitic

10 Respiratory

Rx claims trends

Top 10 Classifications

1 Analgesics/anti-inflammatory

2 Antidiabetics

3 Psychotherapeutic/neuro

4 Dermatologicals

5 Antiasthmatic & bronchial

6 ADHD/anti-narcolepsy

7 Antidepressants

8 Antihyperlipidemics

9 Antivirals

10 Analgesics-opioid

Top 10 Drugs by Allowed Expense

1 Harvoni (Hep C)

2 Enbrel (Arthritis)

3 Humira pen (Arthritis)

4 Avonex (Multiple sclerosis)

5 Gleevec (Leukemia)

6 Orkambi (Cystic fibrosis)

7 Humira (Arthritis)

8 Gilenya (Multiple sclerosis)

9 Sovaldi (Hep C)

10 Methylphenidate ER (ADD/ADHD)

EAP & Critical Incidents

22%24%

29% 29% 30%

0%

5%

10%

15%

20%

25%

30%

35%

2013 2014 2015 2016 YTD 2017

EAP Utilization

12 12

10

12

9

0

2

4

6

8

10

12

14

2013 2014 2015 2016 YTD 2017

CISD

Top 5 Issues:

1. Relationship/Partner

2. Psychological

3. Stress & Depression

4. Anxiety-related

5. Family/Child

Safety/work comp trends

• Diverse workforce – aging, retiring, and hiring millennials

• Increased cost of care

• Rx utilization up – controlling opioid use

• Police – resisting arrest & defensive tactics training

• Fire – lack of return to work policies

• National wave of presumption laws – PTSD

• Increased # of reasonable suspicion testing

• Rise in marijuana test positives for safety sensitive positions

Work Comp claim trends

11.51 11.7910.7110.56

8.86

12.75

16.3317.85

21.26

0.00

5.00

10.00

15.00

20.00

25.00

2014 2015 2016

Incident Rates

PW/Parks Fire Police

$4,840

$5,704$5,785$5,892

$5,432

$11,402

$4,217 $4,531$5,181

$0

$2,000

$4,000

$6,000

$8,000

$10,000

$12,000

2014 2015 2016

Average Cost per Claim

PW/Parks Fire Police

Which claims are the biggest problem?

Lifting injuries, strains and sprains

Latest statistics on drug testing

Drug testing statistics

Property & Liability claims trends

• Weather/climate related claims

• Public records lawsuits

• Rise in jury awards

• Police use of force (civil rights violations) & false arrest

• Rise in jail-related claims & deaths nationally

• Aging infrastructure

•Water/sewer

• Bridges & dams

• Cyber terrorism

Weather volatility

Weather volatility & aging infrastructure in CA

OR experience – 2013-2017

Employment, 41%

Police, 25%

Storm & Sanitary …

Streets & Roads, 6%

Premises, 5%Jails, 5%

Water, 4%

All Other Losses, 2%

2013

Employment, 35%

Police, 27%

Storm & Sanitary

Sewers, 7%

Streets & Roads, 6%

Premises, 5%

Jails, 16%Water, 3%

All Other Losses, 1%

2017

Intersecting trends & loss prevention

Aging workforce Musculoskeletal health

claims

WC – lifting

injuries, strains &

sprains

Collaboration of wellness & safety committees

• Culture of health & safety begins with leadership

• Promote personal health & safety

• Promote workplace health & safety

• Workplace warm-up & stretching

Intersecting trends & loss prevention

Police use of

force liability

claims

Increased CISD &

EAP use for police

WC – defensive

tactics training

when injured

Police staff

recruitment &

retention

Comprehensive loss prevention

• Self-assessment (21st Century Policing Audit)

• Review policy & oversight

• Foster community dialogue – community conversations

• Communication plan – technology & social media

• Build, develop or enhance partnerships

• Training & education

• Be mindful of officers who are recently returning to work from injury

• Officer wellness & safety

• Customized EAP resources for law enforcement

Intersecting trends & loss prevention

Safety –

broadening

opiate panel in

drug testing

Health care –

increased opioid use &

treating addiction

WC – increased

opioid costs

Drug & Alcohol

Employee Training

Carol Wilmes, Director,

AWC Member Pooling Programs

Drug Free Workplace

It’s about

safety

Audience

participation

Employee Assistance Program

• Free

• Individual, couples and families

• Confidential

• Professional

• Employees, dependents,

household

• 24/7

• 1.800.570.9315

Strategic foresight

Strategic foresight: Safety/Work Comp

• Increased drug screens for safety sensitive

• PTSD likely added to Washington presumption list

• Rising health care costs

Strategic foresight: Property/liability

• Automation & emerging technologies change the face of liability,

risk & exposures

• Driverless buses, police cars

• Drones

• Cyber threat – service disruption & cyber terrorism

• Continued climate volatility

• Extreme political polarization

• Increasing contractual liability from public-private partnerships

Strategic foresight: Health

• Narrow, accountable networks

• Prevalent in metro

• Slower to come in rural areas

• Regulatory uncertainty

• Rise in health care trends

• Medicine & Technology

• Increased telemedicine

• Robotics

• Pharmacogentics

• Rx cure for cancer

WE VALUE YOUR INPUT

AND QUESTIONS….

Contact us at:

1-800-562-8981 or (360) 753-4137

carolw@awcnet.org

www.awcnet.org