Tide TRACKERHelping to Navigate the Troubled Waters of Workers Compensation

Table of ContentsA False Debate on Safety Priorities… pg.Resolving Medical Disputes… pg. 2Are We There Yet?: A Guide toSenate Bill 863 Lien Reform… pg. 4Delayed Recovery- A Case Study… pg. 6

A False Debate on SafetyPriorities by Joe Stevens

There is a debate going on insafety circles regarding the mosteffective way to minimizeinjuries. One school of thoughtinsists that training andcompliance are the keys, whilethe other group believes that it ismore important to focus onbehavior. In reality, it isn’t a

case of one way being more effective than the other.The real key is the order in which they areimplemented.

A workplace free of unnecessary safety hazards andin full compliance with OSHA regulations is thestarting point, the foundation, the platform. Hiringthe right people for the jobs, then providing them withthorough, ongoing training in a safe andcompliant workplace comes first. These are the nutsand bolts of a safety program. Only after these thingsare in place is the company ready to move on tobehavior.

An analogy that may help is to think of safety infootball terms. The field must be in perfect condition,and the players must be well coached and know allthe plays. That’s the equivalent of a safe workplaceand excellent training. Now, in order to achieve thegoal of winning, the players must perform to a highlevel. That’s where behavior comes in. If the field isin poor shape, and the players are not well coached,the attitude of the players is affected and we canexpect the results –and, most likely, the effort - to benegative.

Summer 2014

If the basics aren’t provided, there is little chancefor success. When they are provided, the coachesand the team can focus on performance. Safety inthe workplace has the same formula: first makesure that basics are in place and then focus onbehavior. To affect behavior positively, provideclear goals, encourage reporting of hazards andnear misses, recognize contributions and record ofexcellence in both departments and individuals.Make everyone accountable by discussing injuriesand posting results and show appreciation for a jobdone well, and done safely. The better the joba company does at convincing its workers thatsafety is its highest priority, the greater thelikelihood that workers will perform safely.

Joe Stevens founded Bridge Safety Consultants in 2003with a focus on safety culture. Having served on TheGovernor’s Task Force for Workers’ Comp Reform in2004, Mr. Stevens helps companies understand the costdrivers in the workers’ comp system, and customizessafety programs that strengthen the safety culture,produce lower X-Mods and reduce premiums.Website: www.bridgesafetyconsultants.comEmail: stevens@bridgeconsultants.netTwitter: @safety_experts.

Resolving Medical Disputesby James Carey

The medical dispute resolutionprocess has been evolvingsubstantially over the pastdecade. We have becomeaccustomed to hearing theacronyms of MPN and UR beingthrown about on a regular basis. But do we knowhow to use these effectively to defend a case andmanage costs?

One might argue that the ongoing increases inpremium rates do not show a substantial costsavings, whereas another might argue that it doesnot adequately ensure that the injured workers aregetting the treatment they need. The truth lies

somewhere in between and the reality is that we must tailorour use of these tools to each situation to ensure the bestpossible outcome. A prior authorization plan as part ofthe utilization review protocol will go far to ensure thatcare is delivered efficiently, costs are kept under controland ultimately, requests for independent medical review(IMR) are kept to a minimum. A custom andwell-policed Medical Provider Network would go far toensure that a certain quality of care is maintained withinthe network.

Following is a brief outline of the medical disputeresolution process. Additional information concerning themedical-legal process and other strategies can be seen withthe rest of this article on the RiskSolutions’ blog.

1. Utilization Review:

a. Purpose: Assess medical necessity for proposedmedical treatment

b. When Used: For medical treatment requests onuncontested/accepted body parts

c. Appeals: As of 7/1/13, all disputes concerning URdenials are to go through Independent MedicalReview (IMR)

d. Limitations:

i. Does not address causation

ii. Certification does not guarantee payment(authorization comes from adjuster)

iii. If time frame is not met, presumed authorizedand medical-legal exam cannot be undertaken forthe sole purpose of medical necessity (Sandhagenv. SCIF)

e. Caveats:

i. Objection to extent & scope of medical treatmentunder LC 4062 defers medical necessity decisionsto med-legal examiner – No further referral to UR,just send denials & copies of objection to provider

ii. Denied body parts can be reviewedretroactively if found compensable.

2

iii. Approval/authorization can be rendereddirectly by adjuster and thus bypass UR viaprior authorization protocol or at adjuster’sdiscretion

2. Second Opinion Process:

a. Purpose: To address and resolve disputesconcerning diagnosis or treatment plan

b. When Used: For any dispute arising from thediagnosis or treatment plan from the primarytreating physician (PTP) within a valid medicalprovider network (MPN) or health careorganization (HCO)

c. Appeals: Proceed to second or third opinionswithin MPN/HCO and then to medical-legalexamination if controversy remains

d . Limitations:

i. Does not address causation or disability

ii. Second & third opinion must come fromMPN physicians (no requirement for opinion tocome from specialist)

e. Caveats:

i. Not binding and does not automatically allowchange in PTP

ii. All opinions are admissible before WCABproceedings or med-legal exams

3. Medical Provider Network (MPN) / Health CareOrganization (HCO):

a. Purpose: To extend medical control for theduration of a claim

i. MPN: Medical in place for duration of claimif claimant properly notified

1. Notice requirements are more lenientdue to SB 863

2. Treatment can be transferred out ofnetwork if failure to provide noticeresults in denial of medical care

(solution: send claimant to industrialclinic every time)

3. Medical provider listing must becomprehensive within a reasonabledistance of claimant’s home (typically30 mile radius) for the requestedspecialty or specialties

ii. HCO: Absolute medical control for 90 or180 days

1. 90 Day Control: If employer does notoffer or pay for more than 50% ofemployees’ non-occupational healthcare coverage

2. 180 Day Control: If employer offersor pays for more than 50% ofnon-occupational health care coverage

3. Medical provider listing need only listfive medical providers within areasonable distance of claimant’s homefor requested specialty

b. When Used: For medical treatment onall accepted injuries and/or body parts.

c. Appeals: Second opinion process; UR &IMR; medical-legal tract (4061/4062)

d. Limitations: Does not apply to disputedbody parts (e.g. psyche) or deniedclaims, but medical control can beretained where there are multipleallegations to body parts covered by onespecialty (e.g. accepted finger, deniedlumbar spine)

e. Caveats:

i. Valdez decision: Allows for consultationssecured by injured workers to addressrecommendations concerning medical treatmentor disability, but does not allow for ongoingtreatment outside of the MPN

ii. Failure to provide proper notice of MPN:Allows for treatment outside of MPN, but only

3

applies if failure results in denial of medicaltreatment

iii. UR denials: Claimant can go out of MPNto secure if IMR overrules UR decision

iv. No providers within reasonable geographicdistance: If no MPN providers are presentwithin a 30 mile radius of claimant’s home,claimant can treat outside of MPN network

v. Denied claim: Employee is free to treatoutside of MPN if claim is denied in its entirety

* To see the rest of this article, please go to theRisksolutions blog at risksolutions-inc.blogspot.com

James Carey, CSIA, WCCP is a graduate of the Universityof California, Irvine and a veteran claims adjuster withmore than a decade of experience. He has handled claimsat insurance companies, third party administrators andgovernment entities with strong experience handling highlycomplicated cases across multiple states and jurisdictions.He brings an aggressive, employer-oriented style to thetable along with practical knowledge to help employersnavigate the treacherous waters of the workers’compensation system.

Are We There Yet?: A Guideto Senate Bill 863 Lien Reform

by Lisa Sanchez

Congratulations! That claimyou've been struggling with hasbeen settled by a Compromise andRelease. A judge has approved itand the check has been issued.This is great news - the claimappears to have been finalizedand a closed claim should be right

around the corner. However, we cannot forget aboutthose pesky little guys that can hold up the closure ofa claim: LIENS.

4

Hundreds of thousands of liens are filed each yearcosting the California workers’ compensation systemhundreds of millions of dollars, according to theWorkers’ Compensation Insurance Rating Bureau. Weusually see liens filed on litigated claims, especiallywhen medical treatment has been denied by the insurancecarrier. Claims can remain open for months and evenyears after the case in chief has been settled due to liens.The lien reform under Senate Bill 863 creates newstatutes of limitation for filing liens and, also, provisionsfor dismissing liens. The intention of the lien reform is tohelp clear the workers’ compensation system oflingering and inadmissible liens, while freeing up theWorkers’ Compensation Appeals Board (WCAB)hearing calendar for more important matters.

According to the Department of Industrial Relations,Division of Workers’ Compensation, lien claimants whowish to file a lien after January 1, 2013 now have to paya filing fee of $150. A $100 activation fee is required forliens filed before January 1, 2013, but activated for aconference or trial after that date. Liens can be dismissedif no filing or activation fee has been filed. Additionally,there is an 18-month statute of limitations for filing liensfor services rendered after July 1, 2013 and a three yearstatute of limitations for services provided before then. Ifa lien is not properly submitted with proof that the filingfee has been paid, it will be deemed invalid. Under thestatute, claims of two or more providers cannot bemerged into a single lien, thus requiring each provider tofile a separate lien and pay separate filing fees.

Unfortunately, we have already hit a major impedimentwith the new system. The case of Angelloti et al. v.Baker et al. challenged the provisions of the senate billrequiring activation fees and allowing for dismissal of allliens filed prior to 2013 if the $100 activation fee was notfiled by January 1, 2014. The case resulted in a federalinjunction against any further dismissal of liens due to afailure to pay activation fees. This negates theimprovement we had already begun to see in the system.Some lien claimants with smaller claims had beenchoosing to abandon their claims rather than paying thefee. Now, the courts have seen a glut of lien conferenceswith lien claimants aggressively pursuing their claims,eager to get what they can before a final decision isissued regarding the constitutionality of the activation

fees. Obviously, we may have a long road ahead beforewe see any lasting relief for lien resolution.

Lisa Sanchez, CSIA, WCCP is a graduate of the Universityof California, Riverside and has a Bachelors degree inBusiness Administration. She is a seasoned bilingual claimsadjuster with more than eight years experience, havinghandled claims at a self-insured, self-administered employerbefore being drafted to the RiskSolutions team. She brings aunique, employer-driven perspective with her and hands-onexperience working one-on-one with management andinjured workers alike helps employers to fathom the endlessdepths of California’s Workers’ Compensation system.

Delayed Recovery – A CaseStudy by James Carey

Early intervention in delayedrecovery cases is not a new concept,however, applying it to workers’compensation is just starting to takehold in our industry. Most payorstake this concept and apply variousmeans of identifying potential delayed recovery cases,such as predictive modeling using pure statistical dataor having adjusters or nurses identify red flags. Seldomis the next step taken- decisive action towardintervention.

We have been developing and testing our ownprogram, DREI (Delayed Recover / EarlyIntervention), which consists of an algorithm applied toa behavioral interview at the three-point contact

coupled with predictive modeling elements and humaninterpretation. The results is a report withrecommendations for early intervention. With theserecommendations, we have seen where interventionhas been successful and where a lack of action,bureaucracy, or poor understanding causedunnecessary time off work.

A sample case study: We start with a young worker ata convenience store, who was robbed at gunpoint. Sheexhibited immediate signs of post-traumatic stressdisorder as well as anxiety when talking about work.She was sent to the occupational medicine clinic rightaway and the doctor’s first report referred the patientimmediately to a psychologist or psychiatrist. Inconducting the initial three-point contact and runningthis through our program, we found a few indicatorsthat the patient may not want to return to work rightaway.

The first indicator is the most obvious: The patient wasa victim of a violent crime, which clearly meets all ofthe criteria for this case to be considered AOE/COE.The next involved performance issues at work, whichcould demonstrate a lack of motivation for return towork (RTW). Also, the patient had some non-industrialpathology that could contribute to her overallemotional state. It was our assessment that this caseneeded an immediate approval for the psyche consultand could quickly become litigated if not handledexpediently. Our other recommendations were tomaintain frequent contact with the patient to provideadditional support and to offer alternative work in anarea that would not be public-facing, so as to keep thepatient working and feeling productive.

Unfortunately, the case did not progress as smoothlyas we hoped. The adjuster submitted the request toUtilization Review (UR) but the request was rejectedfor being submitted “on the wrong form” and the new“Request for Authorization” form was needed toproceed. This caused an additional delay when themedical provider had to go back and duplicate theiroriginal efforts to get the patient to see a mental healthprovider. Contact with the adjuster furtherexacerbated the situation as they refused to allow anyconsultation without it first being approved by UR.

5

First, this underscores an absolute need to have apre-authorization component to a UR plan, particularlygiven the gravity of the situation and the urgent needfor the patient to be seen by a mental healthprofessional. Second, this also demonstrates howquickly a “cost-saving” measure can be misusedsimply for the sake of preserving rights underSandhagen. Finally, for a carrier to have their claimsdepartment so incredibly hamstrung is beyondcomprehension because it mires patient care in animpenetrable web of red tape.

While the request for consultation was waylaid by aninsistence to have the request processed through UR,the patient remained off work receiving temporarytotal disability (TTD) benefits. Had a pre-authorizationprogram been in place, the patient could have beentreating with a doctor of an appropriate specialty. Forinstance, if one were to sustain multiple fractures to thehand, it would only make sense to authorize animmediate referral to a hand surgeon. In this case,authorizing a referral to a psychologist would havebeen the common sense choice, but for some reason, itseems many adjusters these days want to avoidanything to do with psychology. Every week that wentby added another payment that will ultimately go toaffect the employer’s loss ratio and experiencemodification (X-Mod). Even worse, this was doneunder a loss-sensitive policy and not a guaranteed costprogram.

Finding an appropriate provider is a task in and of itself.Often, adjusters find themselves dealing with claims inremote areas where in-network medical providers arefew and far between, sometimes leaving only oneprovider available. Generally, this provider will have astandard fee arrangement they want signed in advancebefore they’ll treat the injured worker. In my adjusting

days, I signed these right away because patient care,recovery and RTW were my top priorities. Bickeringabout bills was always secondary. In our case study, theadjuster had this agreement sitting on their desk for asignificant period of time, thus causing another delay intreatment. When another provider who did not requirea fee agreement up front was found, the patient feltdriving there would be burdensome and expensive withgas prices in excess of $4 per gallon. While we all knowabout mileage reimbursements, it’s always amazed mehow few injured workers know about it until I mentionit to them (despite being mentioned in the cover pageson the DWC-1 claim form).

That said, the nurse case manager handled this case byfollowing the recommendations made by our programand taking regular opportunities to reach out to thepatient and talk to her. One of the easiest ways to avoidcostly and drawn-out litigation is to simply talk to theinjured worker. Workers’ Compensation is downrightadversarial these days and no amount of legislation isgoing to fix that. However, the simple act of reachingout and demonstrating care goes a whole lot further thantreating each patient like a number.

Treating each patient as a whole person instead of asubset of symptoms is the factor that drives our DelayedRecover / Early Intervention initiative. When weidentify a patient at risk for a delayed recovery, weaddress both the person as a whole and a common sensecase management. Though this trend may be in itsinfancy with Workers’ Compensation, it is our missionto change the status quo and aim for lower severityinjuries, less litigation and a more productive workforce. With medical reimbursements and permanentdisability maximums on the rise, insurance is just goingto get more expensive until something is done toaddress these cost drivers from a holistic perspective.

(951) 943-6775 ext 151Fax: (951) 943-5221

etaylor@risksolutions-Inc.comreducing the costs ofdoing business

P .O. Box 18017602 17th St.T ustin, CA 92780

6