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Picture this: San Antonio, with its beautiful River Walk, Tex-Mex food around every corner, and a conference center large enough to host those in-person events we’ve all been missing for the better part of two years.

When Michelle Despres landed in the city from Jacksonville, Fla., her eyes were set on the big prize: Three whole days of in-person events for the annual American Physical Therapy Association’s (APTA) conference, held February 2-5 this year.

As the vice president of product management and national clinical leader for physical therapy at One Call, Despres was looking forward to the lessons APTA 2022 was bound to provide. Little did she know, the biggest lesson would come from the city streets themselves.

“San Antonio had experienced unprecedented winter weather,” she recalled.

The roads were wet that chilly afternoon of February 3. Despres reminded herself to walk with caution, because even though it did not appear like it, ice could be a possibility.

“I had crossed this particular crosswalk many times, because I had been at the conference a couple of days early for meetings,” she said. “When I went to cross, the light was green. I didn’t need to slow down, stop or wait. I kept walking at a rapid clip and stepped off the curb. As soon as my foot hit the ground, I slipped. I heard the snap; I felt the snap.”

Despres’ left leg with splint and pins in place.

Her leg broke, shattered to the point that one physician later told her it looked like someone had taken hammers to her bone. The pain, she said, was instant. Fortunately, she was surrounded by professionals and students attending a conference all about healing after injury.

“A group of PT students scooped me up, carried me inside the building, called 911, and the ambulance came,” Despres said. (She remains in contact with the Oklahoma-based students to this day.)

Pain control began immediately. Despres was administered opioids in the ambulance, followed by more pain control medication at the hospital. An x-ray and CT scan showed a spiral fracture of Despres’ tibia with comminuted fractures of the tibia and fibula bones. In Despres’ words, “My foot was going east and west, but my leg north and south.”

All the while, Despres was on the phone, communicating with work, her husband, her hotel and so many others. Her husband was desperately trying to get out of Jacksonville, only to face flight cancelations and delays due to weather. Her colleagues were alerting the right groups within One Call to get her workers’ compensation claim started, her medical bills handled, and her workload off her shoulders.

“I work with a great company. I work with people who are friends. Reaching out to them got things rolling,” she said.

That night, as the initial report of injury was on its way to open Despres’ workers’ compensation claim, the medical team needed to reduce her fracture and splint it for Despres to be admitted to a room. Surgery was slated for the next day.

“Since I couldn’t tolerate anybody touching me, they attempted to sedate me with propofol,” Despres said. “That did not work. They came in with ketamine — I had heard the name before, but I didn’t know anything about it.”

She soon learned ketamine is an injectable medication used for pain management and surgical anesthesia. It is a very strong drug; however, it can sometimes cause hallucinations.

“The ketamine worked, but induced a really horrific death-ride dream,” Despres shared. “I woke up and asked the doctor, was I dead?”

It was not an easy start for Despres. And it would not be a smooth-sailing journey for quite some time.

After the fracture was set, she spent the night in the hospital. The next morning, her surgeon broke the news — the surgery she needed could keep her off her feet and in San Antonio for up to 12 weeks. In addition, he said travel would require strict accommodations.

“San Antonio is not my home. I didn’t have a support system there. Even if I stayed at the Marriott, which was where I was booked, they weren’t doing room service at that time,” Despres said.

All those years focusing on the biopsychosocial model in workers’ comp became a reality. If Despres were to remain in San Antonio, she would face many factors that could easily become obstacles to her recovery. Where would she go? How would she eat? Who would be able to assist her with her leg out of commission?

The doctor gave her about 25 minutes to see if she could find a surgeon in Jacksonville as well as a safe way home. The choices were to either have full internal fixation and stay in San Antonio up to three months or have an external fixation, which would be enough to get to Jacksonville and find a surgeon willing to take on the internal fixation.

Due to the ice storm and canceled flights, her husband was still in transit. Her claim was in the process of being opened, but an adjuster hadn’t been assigned yet.

“Mind you, it’s the next day. I’m still on a lot of pain control, and I’m by myself. I had nobody there to say, ‘These are good questions’ or ‘Let’s talk through it,’ ” Despres said.

The surgeon did not have any recommendations for where she could go in Jacksonville, but he did do a quick Google search and found a surgeon with reviews and the skills he thought would be a good match.

But when Despres called, she was met with an interesting roadblock. The woman who answered told her that the Jacksonville surgeon would only treat traumas that happened in Jacksonville.

“I said, ‘What?’ I didn’t mean ‘what’ as in I didn’t understand what she said. I meant ‘what’ as in that doesn’t make any sense.”

After a few more exchanges, Despres was hit with another doozy — the woman told her Florida workers’ comp law states that she couldn’t be treated for 90 days post-injury. Despres knew for a fact that was wrong. She hung up the phone.

At a loss and out of time, she went through with the external fixation surgery in San Antonio with the hope that plans could be made for a return to Jacksonville safely to perform the final fixation there.

After surgery, Despres did not give up on getting home. In the hours that followed, she contacted everyone she could think of to alert them to her situation. She was hopeful for a solution. Her husband finally arrived the evening following her surgery, so she had some assistance.

Her search started with flights out of San Antonio to Jacksonville, but with the type of injury and her risk of blood clots, flight logistics didn’t line up. But One Call came through — the team had set up an air ambulance to get her home when she was able to be transferred.

Now all Despres needed was a place to go.

Her adjuster and case manager began working with the hospital’s case manager on her transfer plans. Four days post-injury, the hospital nurse case manager came through with a detailed plan. Despres would be sent to a skilled nursing facility until an outpatient office visit with a surgeon could take place.

But the office visit was days away, and it was with the same group she reached out to in the 25 minutes prior to surgery.

Despres was skeptical of the plan. Knowing multiple transports and appointments could delay scheduling surgery for another three to four weeks, she suggested a hospital-to-hospital transfer. After voicing her concerns, she was met with the hospital’s case manager’s response, “We’ve done what we can.”

In addition to Despres’ case manager and adjuster making calls, Despres and her husband reached out to facilities in Jacksonville, to Despres’ co-workers, to anyone she could think of who might be able to get her someplace where her follow-up surgery and appointments would be handled in a way that gave her peace of mind.

“Ultimately, we reached out to a friend who’s a surgeon at a local hospital and explained to him what was going on. He said, ‘Give me 20 minutes,’ ” Despres said. He got the head of trauma on the phone who said while the trauma center was filled, he’d make it work.

One Call’s air ambulance service took her from her hospital bed to the airfield in San Antonio, then to the airfield in Jacksonville, and then to the trauma center there.

Despres could finally breathe a sigh of relief.

Despres on her way home from San Antonio to Jacksonville, Fla.

Recovery from that point continued to have its challenges.

Several roadblocks presented themselves at the hospital in Jacksonville, including spending a night in the trauma emergency hallway area while hoping a patient room would become available.

Despres had received so many IV lines between the two hospitals that she still had bruises on her arms eight weeks post-surgery.

She found x-ray imaging from the initial intake in San Antonio was missing from her files.

She had to make several phone calls to get certain medications filled on time.

“When I was discharged, it became abundantly clear I was limited in a lot of ways. I was limited in my ability to get dressed, to bathe independently and to manage simple tasks,” she said.

Her husband did what he could while also running his own business, but Despres needed more assistance. Her father stepped in. After the unexpected death of his wife last fall, the family was grieving, but he embraced the opportunity to give Despres the hands-on assistance she needed for several weeks following her second surgery in Jacksonville.

“Getting in and out of cars was difficult. Getting in and out of bed was difficult. Getting up from the chair was difficult. I couldn’t make a meal, because I couldn’t stand independently,” Despres explained. “My father, who was dealing with the loss of my mom, came every single day at five or six a.m. He helped me everything until my husband came home in the afternoon.”

Despres has faced many trials in her journey thus far, but there have also been triumphs.

For starters, the team at One Call has given her unyielding support. From day one, they eased her mind about care and equipment needed and told her to focus on healing.

“The workers’ compensation component happened within two hours of injury. After I talked to my colleague, she reached out to our senior vice president who called me and said, ‘This will be taken care of under work comp. You’re on a work trip.’ And she spoke with someone in the emergency room to give them all the pertinent information,” Despres said.

“She did my first notice of injury right away and started making phone calls.”

The One Call team was also quick to help set up accommodations for Despres at home. By the time she was discharged in Jacksonville, a ramp had already been installed at her house. A shower chair had been delivered. Arms for the commode had been sent. Her workload had been distributed amongst her co-workers so she could heal before returning to work remotely.

And above all, Despres’ experience has taught her a lot about the industry she works in every day.

“I have a new perspective on workers’ comp,” she said. “I’ve learned many lessons that I believe will help us improve our industry and better serve injured workers.”

And what are those lessons, exactly? Despres shares her insights in part two of this two-part series.  &

3 Lessons This Workers’ Comp Professional Learned After Shattering Her Leg on the Job

In part two of this two-part series, Michelle Despres of One Call shares the critical workers’ compensation lessons she learned after breaking her leg during a business trip. Check back on July 6 for more details.

Read to find out about the impact of "The Great Resignation" and how to address this crisis head on.

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There are a host of different factors that captive insurance companies need to take into account when deciding on where to be domiciled.

They need to look at the regulatory environment; capitalization, taxation and fees; the local captive community; and the implications of being onshore or offshore.

But what is often most overlooked is the importance of the use and quality of regulatory examinations.

Rather than relying on meeting solvency, liquidity and profitability ratios or captive managers to keep regulators informed of any potential regulatory issues, some domiciles like Vermont carry out periodic examinations to ensure compliance with their laws. Prospective captive companies might not realize that examinations can be very beneficial to them in the long run.

Thoughtful and well executed regulation is essential in establishing the credibility of a captive domicile.  With over 40 years of experience and over 1250 licensed captives, Vermont has established a very robust regulatory framework for captives.  This framework includes firm and fair laws, a careful and considerate licensing function, and ongoing monitoring, a vital part of which includes routine examinations.  Exams (and analysis) are tools that the regulator has available to ensure the financial health and wellbeing of their regulated entities as well as the industry overall.

Dan Petterson, Vermont’s Director of Captive Examinations said, “Exams provide an opportunity to get to know our companies better, understand their challenges and successes, and learn what is driving their decision making.”

Petterson started with the Captive Division in 2010 and has seen over 1200 examinations finalized since that time.  “We evolve and our captives are constantly evolving.  Exams allow us to see where a company has been, but also can provide comfort that a company knows where it is going and has the resources to get there.”

So what makes examinations beneficial? One important aspect is when a domicile has properly qualified and trained staff to examine the sophisticated operations of that captive.

The examiners effectively act as a backstop to ensure that the credentials and financial information a captive management team presents when seeking licensing are sound and valid. They look at three key areas when determining how well the company is run: financial reporting; overall governance and general compliance with that State’s laws and regulations.

As a gold standard domicile, Vermont has been at the forefront of captive examinations for the past 40 years with its hands-on approach to regulation, being statutorily authorized and required to perform exams on its captives. During that time, it has built a 23-strong team of expert examiners who regularly and thoroughly examine the domicile’s 600 active licensed captives, conducting more than 100 exams a year. There is a very low turnover rate in the department and many of Vermont’s captive examiners not only have the necessary education and certifications to do their job well, but many came from the private sector in the captive industry and are using their skills in their regulatory role.

Petterson also indicated that his team spends a great deal of time refining their programs with a goal of providing an efficient and effective process tailored for each of the captives being examined.

The exam process, which is repeated every three to five years, results in the issuance of an examination report.  “Exams further provide confirmation that a company is doing well via the exam report, and companies do like to report that they are doing well”, said Petterson.  “Companies that choose to place their captive in a well-regulated domicile not only appreciate that level of regulation, but they expect it.”

Dan Petterson, Director of Captive Examinations, State of Vermont

“There are several factors that captive owners and managers need to take into account when looking at examinations,” said Petterson.

“They need to know whether the examinations team is experienced; how often they carry out exams; how much each one costs; how long they take; and what value they can add to the company.”

Captive regulation varies by state with some domiciles choosing to complete exams and others not.  There are also some domiciles that have in-house exam staff and others that use contractors and traditional captive insurance departments may be separate or there may be little separation.  These are all factors that could impact examinations and should be understood prior to domicile selection.

Exams matter in many ways, but they do come at a cost.  Average exam fees for pure captives in Vermont are in the $10k range and average exam fees for RRGs in Vermont are in the $35k range.  They can also be time consuming depending on the sophistication of the company under exam.   These are a couple of factors that may matter when choosing a captive domicile.

Before choosing a domicile, captive managers can contact the regulator equipped with a set of key questions to ask them about the examination process. Once they get the answers they need, they’re in a better position to make an informed choice about whether that’s the domicile for them.

Rather than relying solely on audits, ratios, or captive managers to keep regulators informed of any potential regulatory issues, some domiciles carry out periodic examinations to ensure compliance with their laws. This method also provides a greater degree of regulatory flexibility, but its quality is only ensured if that domicile’s supervisory staff are properly qualified and trained to examine the sophisticated operations of that captive.

As the gold standard domicile, Vermont has been at the forefront of captive examinations for the past 40 years with its hands-on approach to regulation, being statutorily authorized and required to perform exams on all of its captives. During that time, it has built a 23-strong team of expert examiners who regularly and thoroughly scrutinize the domicile’s 600 active licensed captives, conducting more than 100 exams a year.

To ensure the financial health and wellbeing of the captives it regulates, Vermont has a range of tools it uses to actively monitor and regulate them, ensuring the process is as smooth, efficient, and painless as possible for both the company and regulator, while adding value at both ends. These measures include laws, regulations, orders, target reviews, supervision, liquidations, and analyses. Essentially, it’s another set of trained eyes on the captive. Identifying issues in the examination process can help prevent future insolvency.

Captive exams are carried out by appropriately staffed teams and are scheduled based on year, complexity, and degree of coordination with other states (if appropriate). A large percentage of the time is spent planning and understanding the ins and outs of the company being examined, based on interviews with its executives, board members, managers, and other service providers.

The examiners gain a greater understanding of the captive by also closely evaluating its structure, strategy, governance, information systems, controls, policies, procedures, and agreements. The degree of testing depends on how robust their internal controls are, with more work being required on smaller and more sophisticated companies. Multi-state captives also undergo exams that follow full National Association of Insurance Commissioners accreditation guidelines.

Exams in Vermont are completed on average in about 150 days with a goal of no more than 180 days from the start of the exam to the issuance of a final report. While the majority of captives are well-run, there are some key red flags that examiners are trained to look for: adverse loss development and poor oversight being two of them.

“Our exams are all risk-focused, and that means we concentrate our time, effort and resources on the parts of the company that pose the greatest risks to their solvency and likelihood to be able to continue to operate,” said Petterson, “they look a little like an independent audit, but are less frequent and have a greater emphasis on governance and compliance, as well as prospective risks.”

The end goal is to ensure all captives that are examined remain solvent. It’s also to make sure that all the stakeholders involved are protected too.  For their part, companies need to be open and respond promptly to help with the process and ensure everything is kept within timeframe and budget. By communicating problems at an early stage, they can be resolved quicker too.

“Our hope is that we provide some value to our regulated entities during examinations, whether it be through discussion of findings, recommendation of best practices, or just relationship building,” said Petterson.  “We want our companies to be successful!”

The benefits of Vermont’s examination process are clear to see, according to some of Vermont’s captive owners. Captive owners said that its partnership ethos is key.

One of the biggest misconceptions about captive exams is that they are simply focused on passing or failing a company. In reality, they can be very helpful and supportive and are meant to ensure a captive’s solvency and give companies a report that says they comply with the regulations and are in good shape, to show their board, affiliates or business partners. This can be beneficial when the company needs to show their board, financial institutions, affiliates or business partners they are in good standing. When issues do arise, though, they are identified with a collaborative approach.

“Vermont takes a collaborative approach on their regulatory audits, which in our experience provides a productive, more detailed and thorough result,” said Steve Wilder, Vice President, Risk Management at Disney. “Through this co-operative process, a true partnership is created that gives me comfort in knowing my teams and service providers are operating well together and in compliance.”

Vermont’s experience is another big plus point. As is its proactive, risk and solution-based approach to weeding out and correcting any issues.

“It is reassuring to collaborate with professionals who have the depth of experience of our Vermont regulatory team,” said Julie Bordo, captive owner of PCH Mutual Insurance Company, Inc.

“We can rely on our regulators to flag issues or identify trends and take the time to meet with us to exchange thoughts and ideas leading us to solutions.”

Another key advantage is that because Vermont’s examiners are in-house, they can take the knowledge and experience they have acquired over forty years and continue to apply that to future exams, as well as developing a much deeper relationship with the captive. Because of this experience carrying out both examinations and surveillance, they have a more well-rounded set of tools to evaluate a company with as well.

Thanks to technology and already working remotely, Vermont’s examinations team was able to overcome the challenges of the COVID-19 pandemic. The efficiency of being able to talk with captive managers and owners online has also helped to speed up the examination process.

The process is continually evolving, and Vermont is constantly looking for ways to refine and make the process more efficient. It is important for captives to see that a domicile is seeking feedback and improvement in their regulatory processes.

Success breeds success, and the better thought through and executed it is, the more it adds to Vermont’s credibility as a leading domicile. That, in turn, also protects the reputation of the companies.

“Our model was designed to provide the regulatory oversight needed to regulate insurance companies, but it was also built with the ability to scale it for entities that we regulate,” said Petterson. “In that vein, we want everyone to recognize that we not only have the tools to do the work the right way, but also to do it well, and exams are just one of those tools.”

“At the end of the day, most companies want oversight of their insurance program as it legitimizes it and provides them with comfort. They want to know that everything is being done correctly and that they are well-regulated.”

For more information about Vermont Captive, visit www.vermontcaptive.com.

This article was produced by the R&I Brand Studio, a unit of the advertising department of Risk & Insurance, in collaboration with State of Vermont. The editorial staff of Risk & Insurance had no role in its preparation.

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