ALBANY — While Albany may have seen workers’ compensation costs spike by $912,000 in 2017, city officials say it could’ve been worse.

The city hired Troy-based Triad Group to administer workers' compensation in late 2016 — a move Albany officials said would save the city $250,000 in administrative fees.

The group, which acts as a liaison between the city and injured workers, has contracts with municipalities statewide. Triad replaced POMCO as the city's third-party administrator after an outside review of the city’s administration of workers’ compensation.

Syracuse-based OneGroup found POMCO had charged the city additional fees on certain items that should have been included in the flat fee for service, according to a 2016 review. Albany then asked for new vendor proposals and hired Triad in October 2016.

Rachel McEneny, Albany’s commissioner of administrative services, said the new vendor helped the city avoid $282,000 in fees associated with administering the different claims in 2017.

Those savings were negated with a jump in schedule loss of use claims, which provides a percentage payout for injuries based on the loss of range of motion. Payouts for schedule loss of use in 2016 were $119,604, and jumped to $2.1 million in 2017.

Payouts were set to change in 2018 and were anticipated not to be as favorable to claimants, which Albany officials say accounted for the increase.

Michael Kenneally, executive director at the state Municipal Workers’ Compensation Alliance, said those changes could have prompted an influx of claims to get higher payouts.

“We’ve seen that before. In advance of an anticipated change, the attorneys of claimants try to lock in certain benefits,” he said.

McEneny said Albany expects awards going forward with the new legislation to be significantly less in comparison to some that were cut in 2017, which were as high as $90,000 or $100,000.

“Change is hard in any organization. Transitions sometimes take more time,” she said, adding she hopes to see savings in the future. “We want to keep our employees safe and uninjured, and the more that happens the more we will save.”

Kenneally said workers’ compensation costs to employers is highly volatile and have many variables, making it hard to pinpoint what exactly would cause an increase.

“If you have a great experience one year, costs can come down. If you have a rough experience, costs can go up,” Kenneally said. “There are some that perpetually increase.”

Chief City Auditor Susan Rizzo has expressed concern over the spike in schedule loss of use, and encouraged the city to pursue efforts that will drive down costs.

"The administration needs to consider ... adding back a safety and training program. I also suggested enhancing surveillance to rule out any fraudulent behavior," she said. "Workers compensation is a benefit that must not to be abused."