The big event on the second day of the IAIABC Annual Conference is the Commissioner’s Forum. In this session, regulators from around the nation provide an update on the issues their state is addressing. Note, not all jurisdictions were represented at the meeting.
Medical treatment guidelines are currently being developed.
There was a significant Supreme Court case addressing the presumption that intoxication was the proximate cause of a work injury. In the Bull Shoals Landing case, the Court departed from prior case law and ruled that the presence of marijuana in the injured worker’s system did not in an of itself create a presumption that intoxication was the proximate cause of the injury. The Court felt there was no evidence that the accident itself was caused by the marijuana. This case had been denied by lower courts.
One of the biggest issue they are currently facing is a shortage of IME physicians. The State appoints IMEs to resolve medical disputes and there is a very small pool of physicians that are willing to conduct these exams. This is creating mistrust of those physicians among injured workers.
They have experienced significant success from their pharmacy formulary and treatment guidelines in reducing medical costs and opioid use. They continue to refine these guidelines.
A treatment guideline bill will be introduced in the next legislative session.
Evidence based treatment guidelines are being developed.
The biggest issue faced by the State has been the bankruptcy of two major employers (City of Detroit, Delphi Automotive). These are two of the largest self-insured insolvencies ever seen in the nation, and there was not adequate collateral held by the State to cover these losses. The State has stepped in and started funding claims for these employers so that benefits would continue to be paid.
Medical treatment guidelines are currently being developed. They are in the process of moving their hospital fee schedule to be Medicare based. A new pharmacy fee schedule and regulations on physician dispensing are also being implemented. There is an increased focus on identifying uninsured employers.
There is a booming economy here driven by the oil business. This has led to a significant increase in premiums and claims. The biggest issue being faced by this monopolistic system is injured workers who return to their home state for medical treatment. The State is trying to find ways to address treatment protocols and reimbursements for these out-of-state providers.
They are in the process of updating their medical fee schedule for the first time since the 1990’s. They are also increasing their focus on workplace safety and addressing opioid abuse.
The State is currently collecting data from carriers and self-insured employers on prescription drug costs and physician dispensing. This is the first step in completing analysis of these issues to determine whether additional regulations are needed.
There are discussions of whether medical marijuana should be added to the workers’ compensation fee schedule. It is possible a bill on this will be introduced in the next legislative session.
Appeals from the Workers’ Compensation Commission go straight to the State Supreme Court, and this has resulted in some unusual opinions in the last year. There are new physician dispensing rules and a pharmacy fee schedule being developed. Finally, they are increasing their focus in making sure self-insured employers are posting adequate collateral.
The 2011 reforms has resulted in 3 years of declining rates. A 30% reduction in the fee schedule produced a 24% reduction in medical costs. The reforms also changed to AMA impairment guidelines. However, cases involving these guidelines are just now starting to make their way through the system so it remains to see what the cost impact from this will be.
This state has higher than average costs for healthcare services, both in workers’ compensation and group health. However utilization is low so overall medical costs are in line with other states. A fee schedule is not being considered as there is significant resistance to this.
Police officers pushed for a presumption of Post-Traumatic Stress Disorder for officers exposed to certain situations. This bill did not make it through the Legislature.
Rising medical costs continue to be a challenge. The last 10 years the percentage of total costs attributed to medical has increased. A fee schedule was proposed in the last two Legislative terms, but this did not pass. Alternative Dispute Resolution was initiated to resolve disputed claims. Cases using the ADR system were resolving in 6 weeks compared to the 6-9 months in the traditional system. EDI compliance is an increased focus and report cards are being sent out to carriers.
There were significant concerns around the solvency of self-insured groups in the state. Legislation was passed to allow the State to take over future liabilities of these groups and shut these down. There are only 4 groups still active and they are being held to a much higher standard on financing. The State also recently issued voluntary opioid guidelines.
The Statutes do not allow illegal aliens to collect any indemnity benefits. There are cases pending before the State Supreme Court challenging this. They are also starting to look at evidence-based treatment guidelines.
They addressed concerns around Medicare denying coverage for treatment of personal medical conditions on claims where there is an open workers’ compensation claim. Medicare seems to be red-flagging files without regard to the conditions being treated. Uninsured employers are becoming a bigger issue and they have seen a corresponding increase in their residual market. Treatment guidelines are being developed with acute and chronic pain being the initial focus.
An uninsured worker program is being developed which will make contractors liable for all of their subcontractors who do not carry coverage. There is concern over opioid abuse in the state. They have 1.2 million residents, and there were 83 million opioid dosages dispensed last year.
It has been 14 years since their last major reform legislation, and they have seen 7 straight years of declining premiums. They are currently building an new online filing system with the goal of becoming paperless.
They have created a proof-of-coverage portal for contractors to verify that their subcontractors have coverage in place. The contractors are alerted if this coverage status changes. They just created an advisory committee to review opioid issues. New regulations on physician dispensing are being implemented.
They continue to focus on improving medical outcomes for injured workers by refining treatment guidelines and identifying medical providers who follow guidelines on return-to-work and treatment. Being a monopolistic system, they are very data rich. They are using this information to assist in identifying cases that need additional intervention to ensure prompt return to work.
The fee schedules were revised last year to be based on Medicare reimbursements. They also revised pharmacy fee schedules so that they now provide reimbursement below average wholesale price. Opioid dispensing guidelines have been issued. They are implementing mandatory EDI in 2015.
Faced with one of the highest frequency rates in the country, the State is considering moving to a state-based OSHA program which is more focused on the accident drivers in Montana. There is concern over the funding mechanism for the workers’ compensation system as they have been running a deficit. Consideration is being given to changing the funding formulas. The change in medical control from the employee to the employer has caused significant friction in the system.
In the past year reforms have decreased rehabilitation costs and increased benefits. They are looking at new opioid guidelines. Hospital costs are rising faster than other medical costs so they are looking at moving to a system based on Medicare reimbursement rates.
Comprehensive reforms were passed in 2013 and these were implemented in July 2014. Implementation has gone smoothy and was completed timely. Reforms included treatment guidelines and these continue to be developed. The chronic pain guidelines will be out soon and the rest will be completed by 2016. The biggest change in the reforms was raising the causation threshold to over 50%. It has been challenging to educate physicians on this new standard. A new system is being developed that will ensure injured workers for uninsured employers will be able to receive benefits.
The focus has been on streamlining the administration. E-scheduling with the courts has been implemented and E-filing is coming soon. They also started “Lump Sum Tuesdays” to make it easy to get settlements approved. ODG treatment guidelines have been implemented. The courts ruled medical marijuana must be reimbursed under workers’ compensation and this has created significant controversy. It remains to be seen if the Legislature will address this. In another case, the Court ruled a worker who reached MMI could reopen the claim for additional TTD benefits if their medical condition worsened. There is concern this creates a de-facto lifetime TTD benefit. Finally, farmers and ranch hands are excluded from workers’ compensation by statute and the Legislature is expected to revisit this.
The big news in Florida was the Dade County judge who ruled the exclusive remedy provision in workers’ compensation was unconstitutional because the Legislature has eroded benefits over time to the point where it no longer represents a “Grand Bargain” for injured workers. The order was written by a lawyer for an injured worker advocacy group. The State Attorney General’s office was added as a party late in the litigation and they were not properly noticed so they did not make an appearance. It is expected that the Appellate Court will pass the case directly to the State Supreme Court.
Safety National’s “Conference Chronicles” showcases the educational content from risk management industry events around the nation, providing highlights from sessions so that those not attending can benefit from the insights and trends shared by industry thought leaders.