Five ways employers derail claims with poor medical choices

“An injured employee treated by the wrong medical provider is like a stripped down “to save money” fire policy with more exclusions than inclusions. Right doctor. Right time. Right treatment. Always.” – Preston Diamond, Institute of WorkComp Professionals

A poor choice in medical care can break a worker’s compensation case and result in significant higher premiums for several years. While the rules vary, in many states employers have the ability to direct injured employees to a doctor of the employer’s choice. Even if this is not possible, having a relationship with a competent occupational physician who understands your business and can develop confident relationships with employees will help insure your injured employees get the proper care.

Yet, many employers find the process of choosing physicians outside their expertise and defer the choice to insurers or employees. Here are five ways this leads to unnecessary higher claims costs:

  1. Apathetic commitment to Recovery-at-WorkWhile medical treatment guidelines have gained traction in many states, they are only mandatory in a few states and often permit discretion for the treating physician. As a result, there is significant variability in quality of care and outcomes among physicians. Moreover, today many doctors seek to treat workers’ comp injuries because it is more lucrative than healthcare.

    Given the option, employees will choose to go to their primary care doctor who, most likely, will grant their request. Want a few days off for work to rest? Why not grant it when it keeps the patient happy? Yet, those few days can cost the employer big bucks.

    When there is a strong Recovery-at-Work commitment and the injured worker returns to work before becoming eligible for wage benefits, claims are known as medical-only claims. In 39 states (ERA states), medical-only claims are reduced by 70% on the experience modification worksheet, and usually have minimal effect on the final Mod. On the other hand, claims that also include indemnity payments are known as lost-time claims and often have a significant impact on the Mod.

    This hypothetical example gives an idea of the impact on costs. A small claim ($2,791) that included indemnity had a .0360 impact on the Mod and increased the annual premium by $1,771. Since this increase affects the premium for three years, the employer will pay a total of $5,265! A second small claim ($3,230) was medical only and impacted the Mod by .0125, raising the annual premium by $615 and increasing the premium $1,845 over three years.

    It takes more than lip service for physicians to partner with employers effectively in a Recovery-At-Work program. Look for physicians who:

    • Know the state’s Workers’ Comp rules
    • Come and tour your facility to understand the requirements of the job
    • Develop a good understanding of your Recovery-at-Work program and recognize the value of work in the healing process as well as factors that can keep injured employees out of work longer, such as anxiety, family issues, financial issues, and so on
    • Follow best practice guidelines for each type of injury (typically Occupational Medicine doctors)
    • Have strong communication skills with all parties – employer, injured workers, and claims examiner
    • Engage the injured worker in thinking about recovery and what they can do, not what they can’t do
    • Have objective standards to measure outcomes, such as claims duration, total costs, percentage return to full duty within disability guidelines, litigation, recidivism, and patient satisfaction
    • Have strong capabilities, both in-house and referral network, so that wait times are minimized
    • Do not dispense drugs
    • Have a clear policy regarding opioids
  2. Limited or no focus on outcomesWhile there is a growing focus on developing outcome-based networks for workers’ compensation, fee schedules are the norm for controlling costs. When insurers point out “savings” below fee schedules, this can divert employers from focusing on the real issue – how much they are paying. Physicians and hospitals squeezed by the health care system look to maximize revenues from other sources and workers’ comp is one of the most vulnerable.

    The answer is to direct care to providers who have measures of quality and outcome and deliver the best value, by delivering consistently excellent outcomes and competitive pricing. Insurance adjusters often handle upwards of 250 claims at one time; it’s unlikely they are going to have the time to identify the best provider for each of their clients.

  3. Not a good fit for the employer or workforceWhile Occupational Medicine doctors are a good starting point, it makes sense to drill down further. From past claims employers know where their exposures are the greatest and should identify physicians with specific proficiencies needed for the injuries and hazards in their work setting. In addition, if the employer is in a regulated or hazardous industry, the physician must be familiar with regulatory compliance issues.

    There are other considerations as well. If you have a bilingual workforce, the provider staff, including medical staff, should be bilingual. Equally important, the provider must be able to balance patient advocacy with employer concerns. Injured workers will respond positively to a physician if they have trust and believe the physician is their advocate, thus accelerating the return to worker and reducing the likelihood of litigation.

  4. Poor representation in disputed casesContesting cases when it is suspected the injury is not work-related is never easy, particularly when it involves a cumulative trauma injury, pre-existing conditions, or stress. Failing to challenge cases when the injury cause is not work-related leads to paying unwarranted benefits and emboldens others to file similar claims. On the other hand, wrongly challenging injured workers needlessly drives litigation costs up and leads to morale and trust issues among the workforce.

    Doctors are trained to treat injuries; causation is a secondary concern. While many states do not require that medical opinions be expressed with absolute medical certainty, it is expected that opinions be more than mere speculation and there is a probability as to the cause that can be supported.

    A good medical expert will not only be well qualified, but must be able to write a good report that clearly explains their opinions. Understanding how a physician handles disputed cases is key to avoiding unnecessary litigation costs.

  5. Unnecessary use of emergency room servicesWhen injured workers use emergency room services, they are likely to be told to take time off and medical costs are likely to be much higher. The only time an injured employee should go to the emergency room is when there is a 911 emergency or when there are no other available treatment options. Emergency rooms are busy places and their primary task is to make sure people are not in imminent danger. There’s no time to consider Recovery-at-Work possibilities.

    Furthermore, there’s a higher possibility of an inaccurate diagnosis. More than one-third of reports from consulting physicians for orthopedic injuries in emergency rooms were inaccurate, including 30% of open fractures that were described as closed, according to findings detailed in AAOS Now , a publication of the American Academy of Orthopedic Surgeons. According to the author, musculoskeletal conditions, a common workers’ comp injury, are the most commonly missed injuries in emergency departments.

    Emergency departments rarely communicate with the employer, don’t usually set up follow-up visits or provide ongoing care, and common treatment plans often include rest and no work activity for days or weeks following an injury. All of which means delays, lost time, and added cost to the employer.

For Cutting-Edge Strategies on Managing Risks and slashing Insurance Costs visit www.StopBeingFrustrated.com

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