10 Key Steps To Managing Court Reporting Costs Designed To Save Claims Expenses

By 000983 – May 21, 2010

There are simple ways to lower costs so stop throwing money away

As a consultant working with insurance carriers and the service and technologies who sell to them, I am often asked about new areas for improved cost management. While there are often many opportunities to consider, I often focus on court reporting costs.

Why? First, court reporting costs typically represent 3-5% of a carrier’s overall litigation expenditures (one expert told me recently that he’s seen this be as high as 8% in certain lines of business). Second, this is typically a “non-managed” area of spend for claims organizations. It has traditionally been both decentralized (no one is in charge of it) and delegated (to the law firms).

Why court reporters as a savings opportunity now?

So what makes this a ripe area for opportunity right now? First, the growth of “national providers” in this service area  has been dramatic. These providers have wide-reaching resources and are much more sophisticated than the service providers of old. Second, there are now ways to create metrics around cost and performance in this area. Lastly, law firms “get it.” That is, there is very little push-back from firms, who accept that their clients need (and should) exercise some involvement in this area.

So, what are 10 Key Steps a claims organization should take when deciding how to move forward? Here is my suggested list:

1. Understand the marketplace. Consolidate providers. Create a program to leverage your buying power (its more than you think!) and to improve quality and performance;
2. Focus not just on cost, but on quality as well. Focus on the satisfaction of the end-user (the law firm);
3. Understand that responsiveness and consistency is critical. Evaluate the provider’s physical footprint and network capabilities. Is the “national provider” simply a loosely cobbled together network of affiliates, or is it one company delivering consistent quality standards?
4. Evaluate the technology offerings of the national provider. Speed of access to information, and efficiency for users, has never been more important. What resources will the law firms receive that local reporters can’t provide?
5. Focus on roll-out methodologies. The single greatest failure of a new program is the inability to gain traction and penetration among the end users. Look for demonstrated successes with a law firm footprint similar to yours.
6. Insist on dedicated account teams from the service provider and clear lines of communication with your own claims team. This is now a business-to-business relationship;
7. Mandate quality surveys. Survey technologies are both easy and cheap. Measure satisfaction.
8. Use electronic submission of invoices. E-billing services in the litigation space are estimated to have a 30-40% penetration rate now. (Does your organization?) Use that technology to its fullest potential.
9. Set clear and defined program objectives. Establish both financial and quality benchmarks and measure them.
10. Stay in compliance with state and local contracting requirements. It is inaccurate to assume that state requirements prohibit the creation of a court reporting program. In fact there are only 3 states that do. Approximately 20 states have certain reporter-selection criteria, but a well-designed program can ensure you are in compliance with these requirements entirely.

You can’t ignore the savings opportunities

One reason that this area is so ripe with opportunity is that the potential savings are simply too large to ignore. A claims organization carrier moving to a national court reporting program today can save 20-25% or more over their current purchasing practices. Hands-down, verifiable savings, with essentially no implementation resources required. It is a recipe for success.

This is a great model to a supply-chain management initiative that can then turn to national providers in other, less prominent, service areas, where the percentage savings can be equally as dramatic: medical records retrieval (60%+), copy services (20%+), e-Discovery, etc.…the list goes on.