In 1986, medical costs accounted for 45 percent of total workers’ compensation claims costs. Medical services now constitute almost 60 percent of workers’ compensation claim costs, according to a November 2011 report released by the National Council on Compensation Insurance (NCCI). Understanding the reasons behind this growing trend and the relevant contributing factors is becoming increasingly important for claims and risk professionals.
The Claims and Litigation Management (CLM) Alliance has developed 34 practical, hands-on educational courses for claims, risk, and litigation professionals. These courses are offered throughout the country at no cost to members and provide attendees with continuing education in all requiring states. One of the course offerings developed by the CLM Workers’ Compensation Committee is Escaping the Pill Mill. This course addresses the options available to employers and carriers when faced with ever-escalating medical costs from providers who treat patients excessively, inappropriately, or both.
The course topic is not to be confused with addressing the pill mills at the center of our nation’s prescription drug problem. Those entities typically function on a cash basis, do not perform physical exams, and treat patients exclusively with pills dispensed from their clinics.
When considering medical cost containment, initial selection of the treating physician is one of the most important factors in determining the outcome of a workers’ compensation claim. In 2007, the Workers’ Compensation Research Institute (WCRI) published a study that compared cases in which injured employees selected their primary provider to other similar cases in which the employer selected the provider. The study found that costs were generally higher and return-to-work outcomes poorer when the choice was made by the employee.
In most jurisdictions, an injured employee is permitted to choose his treating physician after an occupational injury. Some jurisdictions limit the injured employee’s choice of physician to a panel or provider network selected by the employer. Often, insufficient time or attention is given to selecting physicians based on their medical and return-to-work outcomes. Expertise in occupational medicine is often beneficial when it comes to treating injured workers, and helps foster a quick and successful return to work. In Maine and Michigan, the employer controls medical treatment for a specified period. Although a minority of jurisdictions grant the employer control over the medical provider selection, this does not eliminate the issues related to physicians who provide excessive or inappropriate care.
Claim professionals and risk managers will recognize the scenarios often associated with excessive or inappropriate medical treatment discussed in this course. They include:
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Improper treatment for the injury sustained;
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Refusal of providers to refer an injured employee to another specialty until they have exhausted all treatment in their specialty;
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Refusal to place an injured employee at maximum medical improvement due to continued pain complaints despite a lack of objective medical findings;
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Providers who refer injured employees to the same specialists regardless of diagnoses;
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Injured employees who are non-compliant with medical treatment, resulting in lags in treatment; and
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Pain management involving long-term use of narcotics and injections.
Escaping the Pill Mill provides a blueprint for either eliminating unnecessary medical treatment or deauthorization of the medical provider to get the claim back on track. Some of the options explored include:
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Second opinions
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Utilization review
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Employer medical examinations (EME)
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Independent medical examinations/evaluations (IME)
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Functional capacity evaluation (FCE)
Workers’ compensation provisions vary from state to state, and Escaping the Pill Mill reminds attendees to check their statutes, regulations, and case laws. However, the course provides some state-specific cases for examination and discussion. For example, Alabama Code 25-5-293(k) and Alabama Administrative Rule 480-5-5-.06 and .07 allow a carrier or employer to challenge the treatment method of an authorized doctor through the utilization review process.
In Wyoming, a monopoly state, Wyoming Statute 27-14-401(f) indicates that an employer may require a second opinion from a healthcare provider of its choice. The second opinion can be in the form of an IME, FCE, or a review of the diagnosis, prognosis, treatment, and fees of the employee’s healthcare provider.
Colorado allows the insurer or employer to request an IME to determine maximum medical improvement (MMI) when an authorized treating physician has not yet declared it after 18 months since the date of injury and another physician has examined the worker and declared MMI to have been reached.
Mississippi Code 71-3-15 and General Rule 9 permit the employer to have the injured employee examined by a physician of the employer’s choice to evaluate temporary or permanent disability and medical treatment.
In Florida, an expert medical advisor (EMA) is utilized by the Florida Division of Workers’ Compensation and Judges of Compensation Claims to render expert medical opinion, peer review, and expert testimony to resolve disputes related to reimbursement, differing opinions of healthcare providers, healthcare, and physician services. The employer can request the division or judge to appoint an EMA to settle conflicting opinions between authorized treating physicians. However, the risk of this request should be weighed by reviewing the specialists on the EMA list.
In some jurisdictions, independent medical evaluations are ordered by the court. Nevertheless, the employer is responsible for the cost.
Medical-related disputes in the Texas workers’ compensation system are resolved by designated doctors. A designated doctor is one who is selected by the Texas Department of Insurance, Division of Workers’ Compensation (TDI-DWC). The injured employee, employer, insurance carrier, or the TDI-DWC can request an examination by a designated doctor. The TDI-DWC determines if a designated doctor should be appointed to conduct the exam.
Desiree R. Tolbert, AIC, AIS, CWCL, is the national technical compliance manager at Sedgwick Claims Management Services, Inc. She has been a CLM member since 2009 and can be reached at (407) 833-4126, desiree.tolbert@sedgwickcms.com.
Continuing Education
The next presentation of CLM’s course, Escaping the Pill Mill, is scheduled for Sept. 11, 2012, in Parsippany, N.J. Tips will be provided on how to get a quality second opinion, IME, or EME report in a timely fashion. Here is a sneak peek at some of those suggestions:
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Be sure that the physician is the appropriate specialist to address the questions at issue;
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Provide all prior and/or relevant medical records for the physician’s review;
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Provide imaging; and
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Be clear and specific regarding the issues to be addressed by the physician.
To register or obtain more information on Escaping the Pill Mill and other CLM courses, go to TheCLM.org.