Chase Manhattan Corp. has launched a service aimed at streamlining the processing of workers' compensation claims.

The service - offered in conjunction with Care Systems Corp., a claims and medical management servicer, and M.D. Sass Partners, an investment manager - is designed to generate automated clearing house transaction volume for Chase. The New York money-center already is the volume leader among the nation's banks.

"We're looking at a lot of initiatives that will drive the volume through our ACH," said Deborah L. Talbot, executive vice president at Chase.

Ms. Talbot said the bank is in the midst of 19 "greenhouse initiatives" in automated clearing house processing - many of which target health care services. "One of our goals is to become a back-end settlement for these services," she said.

In the new service, Chase and its partners do claims processing for companies that do not want to handle their own workers' compensation operations.

Dallas-based Care Systems processes medical claims, and Chase's global payment and treasury services division processes payments. Together, Chase and New York-based M.D. Sass provide financial services related to workers' compensation, such as investment management.

The service predominantly targets companies with more than $500 million in annual revenues. About 2,000 Chase customers fit that profile, Ms. Talbot said.

Workers' compensation costs American businesses an estimated $84 billion per year. Chase executives said the new service can reduce the cost of processing the claims by as much as 30%.

"Workers' compensation is probably the last frontier for health care transaction processing," said Robert S. Reece, director of Carmody & Bloom's health care services practice in Boulder, Colo.

He added that this area is complicated because every state has a different set of workers' compensation regulations.

Mr. Reece said there were 167,000 workers compensation claims filed in New York State last year.

Chase executives said that since much of the claims process is paper- based, workers' compensation presents a great business opportunity.

"We've taken a paper-based, reactive process and taken it electronic," said Robert H. Friedman, a bank vice president.

The new service could prove a boon to Chase, observers said, as long as the bank does not venture too far beyond its core competency of payment processing.

"As long as they stick to their knitting in payment processing, they have a good niche," Mr. Reece said.

Chase has a number of payment processing initiatives related to health care.

In October, the bank took a 30% stake in the Simplicity Payment Association, a bank technology and health care consortium established to help health care organizations process claims.

Tandem Computers Inc., Cupertino, Calif., is a Chase partner in the Simplicity consortium.

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