Workers Comp XML Standards Open the Door to Easier Data Sharing and Deeper Analyses

The WCIO, IAIABC, ACORD, and ISO have been working together to develop an XML (extensible markup language) standards format as an alternative way for transmitting workers compensation data. While adoption of these new standards has been gradual, the momentum is building as more and more insurers realize the benefits and process improvements XML standards have to offer.

More flexible than the current EDI flat file standards, XML workers compensation standards create an efficient, common way for transferring data between applications and over the web. Adopting XML standards will make data exchange between disparate systems and technology platforms transparent, allowing carriers, agents, brokers, third-party services, and data collection organizations (DCOs) to easily share workers compensation data. With a common data dictionary, XML simplifies data exchange, improves efficiencies and data quality, and furthers the goal of real-time data exchange and straight-through processing with single data entry.

In addition to being able to easily transfer data to and from external entities, carriers can use XML standards as a cost-effective interface among their own legacy systems. With these XML interfaces in place, companies can gradually replace their old systems without the costly expense of ongoing system integration and reprogramming. And with XML interfaces, carriers can tap into data that has been difficult to access and use it in more modern applications, such as predictive models and other business intelligence tools.

With its ability to automate workflows and flexibility to program built-in decisioning capabilities, XML also holds much promise in the development of insurers’ web services. Web services have the potential for improving and streamlining the entire claims handling process, making it more efficient, eliminating redundant data entry, reducing overall claims processing expenses, curbing fraud, improving customer satisfaction, and enhancing risk selection and pricing.

XML standards will also make it easier for companies to reconcile their data and respond to special data requests from state regulators. And as federal legislators increase their demands for accountability with acts like the Sarbanes-Oxley Act, the Health Insurance Portability and Accountability Act (HIPAA), the Gramm-Leach-Bliley Act, and the Patriot Act, XML standards give companies the ability to prove data congruence at any time.

Workers compensation carriers have a wealth of data residing in numerous databases in all different formats. Not only do XML standards enable carriers to more easily access their data, share it with agents, brokers, and DCOs, and perform more meaningful analysis of their own business issues, the standards also provide opportunities for higher-level analysis of issues affecting the entire industry. Standardizing workers compensation data using XML opens the door to industry analyses not yet possible.

Currently available XML claims standards
The ACORD XML standards currently available for property/casualty claims include:

1. claims download (a snapshot of full claim activity)
2. claim fraud investigation
3. first notice of loss, first report of injury, and claims notification for auto, general liability, property, and workers compensation
4. claims status inquiry
5. loss runs (bordereau)
6. claims subsequent reports

On the reinsurance side, ACORD standards also cover the full claims process from notice of loss to claim verification, request for payment, claim acceptance, and bordereau (loss runs).

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