Keenan Blog

State Audit Results Show Consistent Achievement

January 22, 2020

Compliance audits recently completed by the California Division of Workers’ Compensation (DWC) Audit Unit demonstrate Keenan’s performance as a third party administrator, resulting in zero assessments and zero penalties. This attests to the value and expertise our people bring by administering solid claims practices on behalf of our customers.

The DWC conducts Profile Audit Reviews (PAR) and Full Compliance Audits (FCA) to rate the performance of insurers, self-insurers, and third-party administrators. The focus of the PAR and FCA audits is to protect the general public and ensure that such insurers and administrators comply with the framework of the California Labor Code. PAR focuses on several different aspects of compliance with the Labor Code, including but not limited to:

  • Adequate indemnification owed to the injured worker;
  • Timely initial and subsequent indemnity payments are made to the injured worker or vendors;
  • Notice provisions are made in compliance with any milestone requirements; and
  • Prompt and accurate information is provided.

Insurers and administrators who failed to meet or exceed their PAR are required to undergo a more extensive FCA.

Since 2003, Keenan claims offices have successfully passed each PAR Audit conducted by DWC. In the 2018 annual audit, our Redwood City/Eureka claims office significantly exceeded the standard and was ranked 6th among 53 insurers and administrators.

The PAR Standard is decreasing each year making it more difficult to pass. A low PAR score reflects more compliant claims handling performance in line with the Labor Code, where a high PAR score reflects a less compliant performance. In order to pass the PAR, the insurer or administrator’s score must be less than the PAR Standard issued by the DWC. Each year, the DWC re-evaluates the PAR standard based on the results of the last three years. The 2019 Audit Results will be rated against a PAR standard of 1.36133, down from 1.47573 in 2018.

Out of the 53 insurers and administrators who were audited, Keenan was the only one that did not have unpaid compensation owed to injured workers on its audited files. Keenan was not subject to any levied penalties and was not subject to any assessments.

For the school districts, municipalities and health care organizations we administer workers’ compensation claims, these results translate into better employee relations, reduced litigation and lower costs. Penalties and assessments reflect on an employer’s claims experience, so maintaining a high degree of compliance with the Labor Code requirements helps hold down their rates.

We are proud of the workers’ compensation professionals who have contributed to this outstanding achievement through their everyday attention to detail and conscientious efforts to serve injured workers and clients.

About Jessica Blakiston
Jessica Blakiston is a Technical Manager at Keenan, where her responsibilities include compliance to AB 1262, communications and compliance for the PAR/DWC audit unit, and lead auditor under Keenan’s internal audit program for operational compliance.