Utilizing a payroll company to ensure accuracy and save time can be beneficial for many practices. However, utilizing this same company for related services such as workers’ compensation insurance – a move that may save time, but usually doesn’t provide value to the practice – is another story.
Why? The inclusion of other services can be likened to add-ons at a car rental company. Added services, such as a collision damage waiver, fuel service option, or daily GPS rental, markedly increase the car rental company’s profit margin, but don't always add value to your experience or satisfy any specific need. Similarly, the addition of workers’ compensation insurance, while convenient, likely comes at a higher cost, without much added value, than if purchased independently.
Before moving forward with purchasing your workers' compensation through your payroll provider, MagMutual urges you to make some careful considerations about what you actually want from your workers' compensation insurance provider.
Here are some questions practices should consider:
- What is the annual cost for your workers’ compensation insurance alone?
- Does your payroll provider’s program offer a dividend?
- What loss prevention/OSHA support is provided?
- What employer’s liability limits are provided?
- What is the provider’s experience modification rate?
- What would your practice’s experience modification rate be if calculated individually?
While purchasing your workers' compensation insurance through your payroll provider might be the best option for you practice, we encourage you to consider the above when making that decision.
Please contact Mark Francis for more information or to provide a complimentary coverage analysis.
For more resources regarding the business of medicine, including employment practices policies, please visit the MagMutual Learning Center.