How Prepared Is Your Bank for an Appraisal Compliance Audit?EDR
How Prepared Is Your Bank for an Appraisal Compliance Audit?
Mitch Kreeger, MAI SRA MBA, Chief Appraiser and Principal Consultant, Kreeger Consulting
March 31, 2015
EDR Insight Webinar
Commercial real estate markets continue their slow recovery. As demand for loans intensifies, regulatory compliance is top of mind for financial institutions. Bank regulators are exercising strict oversight over all types of bank underwriting, including commercial appraisals. This webinar will address head-on the challenges that institutions face in meeting the latest guidance impacting the appraisal function, and what risk managers can and should be doing to survive an appraisal compliance audit.
Attendees will receive answers to these important questions:
• What do current guidance/regulations require of banks related to appraisals and how has that changed?
• What specific things are bank examiners looking for in an appraisal compliance audit?
• Are you doing everything you can to prepare your institution for the scrutiny of examiners before an audit? During an audit? After an audit?
• What are the latest best practices that banks should include today in their appraisal policies to protect themselves during this stage of market recovery?
EDR Insight is fortunate to have Mitch Kreeger for this timely event. Kreeger is a well-known Subject Matter Expert (SME) on various valuation, environmental and seismic risk, and regulatory compliance topics by peers nationwide. Currently, Kreeger is Chief Appraiser and Principal Consultant at Kreeger Consulting, a private appraisal/environmental/seismic risk consulting services firm that offers commercial appraisal reviews, outsourced Chief Appraiser duties, and advisory services to lenders on regulatory compliance, efficient appraisal/environmental risk functions, and effective policy updates.
Audience:
• Primary: Risk managers at financial institutions, particularly at community bank level
• Secondary: Commercial appraisers
How Prepared Is Your Bank for an Appraisal Compliance Audit?EDR
How Prepared Is Your Bank for an Appraisal Compliance Audit?
Mitch Kreeger, MAI SRA MBA, Chief Appraiser and Principal Consultant, Kreeger Consulting
March 31, 2015
EDR Insight Webinar
Commercial real estate markets continue their slow recovery. As demand for loans intensifies, regulatory compliance is top of mind for financial institutions. Bank regulators are exercising strict oversight over all types of bank underwriting, including commercial appraisals. This webinar will address head-on the challenges that institutions face in meeting the latest guidance impacting the appraisal function, and what risk managers can and should be doing to survive an appraisal compliance audit.
Attendees will receive answers to these important questions:
• What do current guidance/regulations require of banks related to appraisals and how has that changed?
• What specific things are bank examiners looking for in an appraisal compliance audit?
• Are you doing everything you can to prepare your institution for the scrutiny of examiners before an audit? During an audit? After an audit?
• What are the latest best practices that banks should include today in their appraisal policies to protect themselves during this stage of market recovery?
EDR Insight is fortunate to have Mitch Kreeger for this timely event. Kreeger is a well-known Subject Matter Expert (SME) on various valuation, environmental and seismic risk, and regulatory compliance topics by peers nationwide. Currently, Kreeger is Chief Appraiser and Principal Consultant at Kreeger Consulting, a private appraisal/environmental/seismic risk consulting services firm that offers commercial appraisal reviews, outsourced Chief Appraiser duties, and advisory services to lenders on regulatory compliance, efficient appraisal/environmental risk functions, and effective policy updates.
Audience:
• Primary: Risk managers at financial institutions, particularly at community bank level
• Secondary: Commercial appraisers
KMWorld 2015 Presentation from Enterprise Knowledge discussing the changing landscape and best practices regarding successful design, implementation, and support for Social Networks.
Feedback and its importance in delivering high quality software - Ken De SouzaQA or the Highway
Broadly, feedback comes in three forms: appreciation, coaching and evaluation. Often the receiver wants to hear one type of feedback, while the giver actually means something else. In your testing career, you will need to understand how to give and receive feedback; from bug reports to discussion quality with executives. Ken will share his experiences of the feedback process during various points in his software development career.Areas where this type of information will help you:
Coaching: giving and receiving comments during test case and session-based reviews.
Evaluation: developing relationships with various levels of management where criticism is encouraged and used to move the organization forward.
Appreciation: helping to preserve the value of the software you are testing. Think bug reports.
Attendees will take away:
How to give and receive feedback, by identifying the various triggers
Ways of practicing it in a safe environment
5th International Disaster and Risk Conference IDRC 2014 Integrative Risk Management - The role of science, technology & practice 24-28 August 2014 in Davos, Switzerland
5th International Disaster and Risk Conference IDRC 2014 Integrative Risk Management - The role of science, technology & practice 24-28 August 2014 in Davos, Switzerland
Consumer-driven contracts: avoid microservices integration hell! (LondonCD - ...Pierre Vincent
Talk from Oct 11th 2016 at LondonCD (https://www.meetup.com/London-Continuous-Delivery)
Autonomy and isolation are some of the core values of microservices, allowing for independent changes and independent deployments. As loosely coupled services interact on interfaces managed under different life-cycles and even different teams, making sure that a simple change did not break the application can turn into an integration nightmare.
Consumer-Driven Contracts testing brings an alternative integration testing approach for distributed systems, relying less on live-like integration environments and more on making interactions explicit and quickly verifiable.
This talk cover how Newsweaver (https://www.newsweaver.com/email-overview) has made CDCs part of its pipeline with Pact and how it improved collaboration and confidence between teams when designing APIs.
Consumer Driven Contracts and Your Microservice ArchitectureMarcin Grzejszczak
TDD introduced many improvements into the development process, but in our opinion the biggest impact relates to code design. Looking at the code from the usage perspective (by first writing an acceptance test) allows us to focus on usability rather than concrete implementation. Unfortunately, we usually rest on our laurels not trying to uplift this practice to the architecture level.
This presentation will show you how you can use the Spring Cloud Contract Verifier functionality in order to have a fully automated solution to stub your HTTP / Messaging collaborators. Just by adding proper configuration, you'll surround the microservices you are testing with faked stubs that are tested against their producer, making much more realistic tests.
We will write a system using the CDC approach together with Spring Boot, Spring Cloud and Spring Cloud Contract Verifier. I'll show you how easy it is to write applications that have a consumer-driven API, allowing a developer to speed up the time for writing better quality software.
Property & Casualty: Deterring Claims Leakage in the Digital AgeCognizant
For property and casualty insurers, the persistent and vexing problem of claims leakage can be effectively curtailed by applying digital technology with cutting-edge clarity.
Learn how to be a RAC Survivor with Laura Legg, HRG Executive Director of Revenue Integrity and Compliance, in this thirty-three slide presentation. Get updated on the 2017 RAC Audit changes and what you can do to prevent a RAC attack.
For more info visit: http://www.hrgpros.com/rac-audit-optimization
hrgpros.com
@hrgpros
800.695.8171
As physicians struggle with the need for medical billing reports, a small PPT on what medical billing reports every practice must pull up, in order to fix revenue leaks.
KMWorld 2015 Presentation from Enterprise Knowledge discussing the changing landscape and best practices regarding successful design, implementation, and support for Social Networks.
Feedback and its importance in delivering high quality software - Ken De SouzaQA or the Highway
Broadly, feedback comes in three forms: appreciation, coaching and evaluation. Often the receiver wants to hear one type of feedback, while the giver actually means something else. In your testing career, you will need to understand how to give and receive feedback; from bug reports to discussion quality with executives. Ken will share his experiences of the feedback process during various points in his software development career.Areas where this type of information will help you:
Coaching: giving and receiving comments during test case and session-based reviews.
Evaluation: developing relationships with various levels of management where criticism is encouraged and used to move the organization forward.
Appreciation: helping to preserve the value of the software you are testing. Think bug reports.
Attendees will take away:
How to give and receive feedback, by identifying the various triggers
Ways of practicing it in a safe environment
5th International Disaster and Risk Conference IDRC 2014 Integrative Risk Management - The role of science, technology & practice 24-28 August 2014 in Davos, Switzerland
5th International Disaster and Risk Conference IDRC 2014 Integrative Risk Management - The role of science, technology & practice 24-28 August 2014 in Davos, Switzerland
Consumer-driven contracts: avoid microservices integration hell! (LondonCD - ...Pierre Vincent
Talk from Oct 11th 2016 at LondonCD (https://www.meetup.com/London-Continuous-Delivery)
Autonomy and isolation are some of the core values of microservices, allowing for independent changes and independent deployments. As loosely coupled services interact on interfaces managed under different life-cycles and even different teams, making sure that a simple change did not break the application can turn into an integration nightmare.
Consumer-Driven Contracts testing brings an alternative integration testing approach for distributed systems, relying less on live-like integration environments and more on making interactions explicit and quickly verifiable.
This talk cover how Newsweaver (https://www.newsweaver.com/email-overview) has made CDCs part of its pipeline with Pact and how it improved collaboration and confidence between teams when designing APIs.
Consumer Driven Contracts and Your Microservice ArchitectureMarcin Grzejszczak
TDD introduced many improvements into the development process, but in our opinion the biggest impact relates to code design. Looking at the code from the usage perspective (by first writing an acceptance test) allows us to focus on usability rather than concrete implementation. Unfortunately, we usually rest on our laurels not trying to uplift this practice to the architecture level.
This presentation will show you how you can use the Spring Cloud Contract Verifier functionality in order to have a fully automated solution to stub your HTTP / Messaging collaborators. Just by adding proper configuration, you'll surround the microservices you are testing with faked stubs that are tested against their producer, making much more realistic tests.
We will write a system using the CDC approach together with Spring Boot, Spring Cloud and Spring Cloud Contract Verifier. I'll show you how easy it is to write applications that have a consumer-driven API, allowing a developer to speed up the time for writing better quality software.
Property & Casualty: Deterring Claims Leakage in the Digital AgeCognizant
For property and casualty insurers, the persistent and vexing problem of claims leakage can be effectively curtailed by applying digital technology with cutting-edge clarity.
Learn how to be a RAC Survivor with Laura Legg, HRG Executive Director of Revenue Integrity and Compliance, in this thirty-three slide presentation. Get updated on the 2017 RAC Audit changes and what you can do to prevent a RAC attack.
For more info visit: http://www.hrgpros.com/rac-audit-optimization
hrgpros.com
@hrgpros
800.695.8171
As physicians struggle with the need for medical billing reports, a small PPT on what medical billing reports every practice must pull up, in order to fix revenue leaks.
Reviews the importance of the claims payment process and how that moment of truth can define the competitive advantage of an insurance company. Focus is on how understanding and improving the process of claims payment benefits market share and organic growth.
Effective Complaint Management: The Key to a Competitive Edge for Medical Dev...Cognizant
By establishing strong complaint management processes, medical device firms can make continuous improvements in patient safety, regulatory compliance and customer satisfaction.
How to Manage a Data Breach Involving Multiple Covered Entity ClientsID Experts
In this webinar, Karen Pugh, the Vice President and Head of Healthcare Compliance at Sutherland Healthcare Solutions, discusses how to navigate the complexities involved in managing a data breach involving the patient data of multiple Covered Entity clients. She'll discuss the entire process — from determining the nature and scope of the breach through handling notification of the affected individuals with their clients.
To view the Webinar Recording, click here: https://www2.idexpertscorp.com/resources/single/how-to-manage-a-data-breach-involving-multiple-covered-entity-clients/r-general
Discussion of strategies for increasing profits without focusing on expense reduction but instead on areas with leverage like claims. Specific examples for gaining an edge are discussed.
ATLANTA RIMS Nov 2013 - Hazards of Best Practices and How to Avoid Them
1. Presented by:
Gary Jennings, CPCU, ARM, ALCM, AIC, ARe, SCLA
Principal
Strategic Claims Direction LLC
November 14, 2013
1
Strategic Claims Direction LLC
Atlanta RIMS
Monthly Meeting and Luncheon
2. TODAY’S TOPICS
Introduction
Define “Best Practices”
Where are “Best Practices” applied?
Professional observations
The current quality of claims management
Scoring “Best Practices” compliance
Are Best Practices meaningless as quality measures?
Additional metrics to measure performance
Conclusion / Q & A
2
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3. What Is Most Important to You?
SIMPLE NEEDS
Resolve the claims
At a reasonable claims cost
As quickly as possible
While reducing or limiting allocated loss adjustment expenses
(ALAE) to the extent possible
Reserve the claims accurately
Inform me of
The current status of the claims
Changes in the environment or industry that affect me
Help me quickly when I ask for it
I assume you are going to use “Best Practices”
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4. What are the Possible Outcomes
of Claims Processing or Management?
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Low Claims
Costs, High Fees
& Expenses,
Slower Closure
Low
Claims,
Low Fees,
Expenses,
Prompt
Closure
High Claims Costs,
Low Fees &
Expenses, Prompt
Closure
$ ----------------------------------CLAIMS COSTS---------------------------$$$
$-FEES,LAE,SPEEDTOCLOSE-$$$
5. “BEST PRACTICES”
Wikipedia – “…a method or technique that has consistently
shown results superior to those achieved with other means and
that is used as a benchmark. In addition, a “best” practice can
evolve to become better as improvements are discovered.”
WhatIs.com – “A technique or methodology that, through
experience and research, has proven to reliably lead to a desired
result. A commitment to using the best practices in any field is a
commitment to using all the knowledge and technology at one’s
disposal to ensure success.”
Businessdictionary.com – “…a business buzzword used to
describe the process of developing and following a standard way
of doing things that multiple organizations can use. “
5
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6. Where Are Claims “Best Practices” Applied?
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Claims Management Components Workers’
Comp
Casualty
General Claims Program Documentation &
Procedures
Claims System Capabilities & Functionality
General Communication with Client, including
Management & Stewardship Reports
Claims Staff Qualifications, Experience, & Training
Adjuster and Supervisor Caseloads
Intake, Set-up, & Assignment
Initial 2- or 3-Point Contact & Continuing Contact
with Client representatives, Claimants/Employees,
Medical Providers, Claimants’ Attorneys, Witnesses
Investigation/Gathering Information
Fraud/SIU investigation
8. Observations
Observations from:
Independent claims audits of insurers, TPAs, and self-
administered programs
Claims quality reviews
Reserve reviews
Claims Department efficiency and procedural reviews
TPA selection and implementation projects
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9. Observations
What am I seeing?
Most insurers and TPAs, especially the national or large
regional ones, have established their “Best Practices”,
and share these with their clients.
Sometimes “Best Practices” are all that exist to measure
the claims administrators’ performance (e.g., no Special
Account Instructions were negotiated).
Many companies have developed “Best Practices”, but
documentation varies widely due to concerns about
subpoenas for claims documentation and claim files that
might lead to unfair claims practices allegations.
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10. Observations
What am I seeing?
Claims handling is increasingly automated, with few
claims administrators keeping paper files
Claims systems are being developed with more triggers
and fields for adherence to “Best Practices”
Adjusting is virtually 100% telephonic
Meaningful supervision is decreasing
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11. Findings
What am I seeing?
Claims handling quality is slipping on the whole.
Outcomes have not been as good as hoped.
Mystery in some circles on why desired outcomes have not
been achieved given their adherence to “Best Practices.”
Remember one of our earlier definitions:
“A technique or methodology that, through experience and research,
has proven to reliably lead to a desired result. “
HOW CAN CLAIMS QUALITY AND THE DESIRED RESULTS BE
SLIPPING IF “BEST PRACTICES” ARE USED MORE THAN
EVER?
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12. Why is Claims Handling Quality Slipping?
Automation and telephonic adjusting can easily morph to Claims
PROCESSING, not Claims MANAGEMENT
Activity-based measurement, rather than results-based
measurement, motivates the claims staff toward activities.
The claims handling identified in claims audits often looks like
sequential “check the box” claims handling.
The adjusters successfully complete many activities in the time
required, but often inadequately use the information they
gathered to set a strategy/plan to successfully resolve the claim.
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Contact Investigate Pay TTD
Refer to MBR /
NCM
Negotiate PPD
Settlement
Assign to Def.
Atty.
Litigate /
Settle
Close
13. Typical WC Self-Reporting Scorecards
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Strategic Claims Direction LLC
Claims Management Components Workers’
Comp
Typical
Score
General Claims Program Documentation & Procedures Y
Claims System Capabilities & Functionality Y
General Communication with Client, including
Management & Stewardship Reports
Y
Claims Staff Qualifications, Experience, & Training Y
Adjuster and Supervisor Caseloads – LT adjuster < XXX
open claims, MO adjuster <XXX claims
Avg. w/in
limits
Intake, Set-up, & Assignment – w/in 1 workday 100%
Initial 3-Point contact & continuing contact with client
representatives, employees, medical providers,
claimants’ attorneys, witnesses – w/in 1 workday
92%
Investigation/Gathering Information – Timely, complete,
continues as needed
86%
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14. Typical WC Self-Reporting / Scorecards
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Strategic Claims Direction LLC
Claims Management Components Workers’
Comp
Typical
Score
Recoveries (e.g., Subrogation, Apportionment,
Second Injury Fund) – identified, investigated,
pursued, recovered
100%
Compensability Decision - reasonable, timely 94%
Medical/Cost Containment – Reduce bills, timely,
PPO penetration
100%
Disability Management/Return-to-Work – use of
modified duty, coordination with employer, medical
provider, and employee
92%
Indemnity Payment Procedures -Timely, accurate 88%
Reserving - Timely, adequate/appropriate 93%
File Documentation – Thorough, timely diaries,
regular action plans (not copy & paste), meaningful
supervision and direction
90%
15. Typical WC Self-Reporting / Scorecards
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Claims Management Components Workers’
Comp
Typical
Score
Negotiation & Settlement – early/prompt, prepared,
outcome vs. expected
86%
Litigation Management – Necessary?, handle by
extension, timely assignment to defense,
appropriate adjuster and defense attorney
responsibilities, fee reviews
96%
Claims Resolution – Finalized, claim/features
closed to reduce reserves to $0
90%
AVERAGE ALL FUNCTIONS 92.85%
Which of these activities are more important than some of the others?
This score should indicate that excellent results are being obtained.
However, that is not always the case.
16. How Does the Claims Administrator
Measure Performance?
System-driven metrics based on fields the adjusters
complete
Timeliness
Intake, Set-up, Assignment
First Contact
Investigation
Reserves
First indemnity payment
Average turn-around for medical payments
Date of assignment to defense attorney to date of attorney’s initial
analysis
Supervisor audits (sometimes)
Quality Assurance (regular schedule, random, targeted)
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17. How Does the Claims Administrator
Measure Performance?
Dollars
Medical bill reductions by method (e.g., fee schedule,
PPO)
Subrogation, Second Injury Fund recoveries
Excess Insurance recoveries
ALAE, especially legal fees
Other measures
Adjuster caseloads
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Strategic Claims Direction LLC
18. Are “BEST PRACTICES” Meaningless?
Absolutely NOT!
Continue to insist on your claims administrator’s adherence to
industry “BEST PRACTICES”
Obtain reports on their compliance
Create reports that measure what you want to measure
Require corrective action if needed
Review quarterly
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19. Are “BEST PRACTICES” Meaningless?
Absolutely NOT!
TRUST BUT VERIFY
Don’t rely upon “Best Practices “ as your sole measure of
claims handling quality.
Insist on more claims MANAGEMENT. Insist that your
administrator:
Provide a higher quality of work - don’t just “check the box” but take
meaningful steps
Create real action plans – Don’t just copy & paste from prior action
plan – develop meaningful and time-measured goals to meet specific
needs for closure
Provide real supervisory direction, not just “Reviewed file”
Reach closure faster, but measure results at the same time
Maintain better control over ALAE
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20. How Do We Measure That?
Develop benchmarks (“AS IS”) against which to measure
future performance and outcomes
Require periodic audits (supervisor audits, QA reviews,
scorecards, your audits, independent audits)
Use claims administrators that demonstrate that they can
and do capture a large number of fields so outcomes can
be measured against activities and early steps taken.
Outcomes by date of first contact
Medical costs by PPO penetration
Many others
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Strategic Claims Direction LLC
21. Typical Measurements
Number of claims per FTE (by jurisdictions)
Cost per FTE (by jurisdiction)
Claims Frequency - # of claims per FTE or per 100 FTEs
Average paid claim (by jurisdictions)
Average Incurred per claim (by jurisdictions)
WC costs as % of payroll
WC costs by location and/or product type
Ratio of litigated cases to all cases (define litigation)
Legal fees as % of total incurred cost
Time to “adequate” reserves (closed file analysis to show
when reserves were at/near ultimate value)
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Strategic Claims Direction LLC
22. Other Measurements
Number of Modified Duty Days to First Contact Lag, Use of
PPO, Location using modified duty
Ratio of Lost Time Claims to Total Number of Claims
Ratio of Medical Only Claims to Total Number of Claims
Ratio of Lost Time Incurred Cost to Total Incurred Cost
Ratio of Medical Only Incurred Cost to Total Incurred Cost
Time lag between
Intake date and assignment date
Assignment date and first contact
Assignment date and date of initial TTD payment
Date of intake to date of reassignment
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23. Compare Total Incurred by Regions or
Locations to Lag Times
0
2
4
6
8
10
12
14
16
$0 $10,000 $20,000 $30,000 $40,000 $50,000 $60,000
Total Incurred
Days from
DOL to Intake
Date “ Lag
Time”
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24. Average Disability Duration to Average
First Contact Lag Time
0
5
10
15
20
25
0 20 40 60 80 100
Disability Duration by Average Intake
Average
Disability
Duration
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25. Other Measurements
Do NOT base performance on
Decreasing reserves without evidence of a long-term
change (e.g., actuarial evaluation)
Faster closure without considering outcomes or
reopened claims
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Strategic Claims Direction LLC
26. Summary
Require “Best Practices”
Require more claims management
Develop more meaningful metrics
Require additional meaningful reports
Trust, but verify
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27. Questions?
CONTACT INFORMATION
Gary Jennings, CPCU, ARM, ALCM, AIC, ARe, SCLA
Principal
Strategic Claims Direction LLC
Phone: (678) 520-3739
Email: Gary.Jennings@StrategicClaimsDirection.com
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