At the 2015 Comp Laude Gala, a panel discussed The Image of Workers’ Compensation and What We Can Do About It. The panel consisted of:
- Moderator: Dave DePaolo – Work Comp Central
- Christine Baker – Director, California Department of Industrial Relations
- Dan Walters – Political Columnist, The Sacramento Bee
- Steve Cattolica – Director Government Relations, CSIMS
- Mark Sektnan – President, ACIC
Question: Are the media portrayals of the workers’ compensation system accurate?
Yes, they are accurate. However one thing that the media is not taking into account is the impact that the political process has on workers’ comp. In California for the last 30 years, roughly once a decade there has been major workers’ compensation reform bill that is passed. The “horror stories” in the media about the failures of workers’ compensation have no impact on this cycle. It takes years to build a consensus, then action is taken, then the cycle repeats itself.
Workers’ compensation has vastly improved over the years in California. Injury rates are down, benefit rates are up, fraud has been decreased, and attempts are being made to ensure injured workers’ receive the appropriate care in a timely manner.
The issue is that the lines of communication are too long which creates significant inefficiency and delays the benefit delivery system. In addition, medical cost containment expenses have significantly increased and have become a cost driver on the system. It is questionable whether these added costs actually add value to the system and enhance the benefit delivery to injured workers.
The legislature pays little attention to the press on workers’ compensation issues and only uses them to advance their agenda. Most workers’ compensation negotiations are done behind the scenes not where they would be subject to media scrutiny.
Question: Why is there sometimes a disconnect between what the legislature does and how the courts interpret the law?
The courts are a significant part of the legislative process. Judges feel at times that the legislature was misguided in their actions and it is the responsibility of the courts to clean things up.
When things are out of balance, change happens. There is a need for the courts to put things back into balance. The courts interpretation of the laws helps to guide the legislature.
Question: Does the grand bargain still exist?
It still exists, but there are constant efforts to push the pendulum one direction or another.
Mistrust between the major stakeholders is a significant issue in workers’ compensation. There is also immense pressure to make changes to the system because of the enormous amount at money at stake. Even small changes can have a significant impact to certain stakeholders.
Question: Were the changes that were made to physician reimbursements with SB 863 justified?
Physicians were left out of the negotiations for the SB 863 reforms, and other special interest groups took money away from physicians to increase what was allocated to their own interests.
There was significant disparity between the percentage of Medicare rates that were being paid to the primary physician vs the specialists. Adjustment was needed so that both were receiving the same reimbursement from a percentage of Medicare basis.
Question: Why is there such a disparity in how utilization review and IMR requests are done?
Answer: There are certainly issues with how some providers and some payers are doing UR and IMRs. But that does not mean the entire system is bad. It means that we need to evaluate what the outliers are doing and make adjustments to get them in line with everyone else.
Question: What are your thoughts about opt out?
Opt out is a reaction by employers to a perceived lack of control in the workers’ compensation system. They feel they can do a better job outside of the of the workers’ compensation system.
Overall, opt out will harm the system. In an opt out system your data is diluted and it reduces your ability to analyze trends.
Opt out shifts responsibility for injured workers from the employers to the social welfare system. It undermines the protections provided to workers.
Question: Is government doing its job to enforce a reasonably just workers’ compensation system?
The state government enforces what is given to it by the legislature. The legislature has failed to review workers’ compensation on a holistic basis taking all things into consideration. Instead, when major reforms happen they are driven by special interests driving their own agenda. Governors are not doing their job to bring all the parties together for comprehensive reform.
More treatment is not necessarily better treatment. It is necessary for the regulators to implement reforms to ensure treatment is not being done just for the sake of treatment.
The tail is wagging the dog. The agencies are driving the agenda and the legislature is not taking the time to understand all the issues at hand before voting on such bills.
Labor and management do work together on workers’ compensation issues and SB 863 was the result of agreement between these two groups who recognized the need for certain changes. SB 863 took years of study and analysis to be achieved. It was not something that was drafted in the back room in a short period of time.
Question: Do the anecdotal stories of harm to injured workers have value?
If there is enough smoke then there is evidence of a fire. However, such things must also be supported by the data to see if the problem is isolated or whether there is actually an issue that needs to be addressed.
Any information about problems in the system can help to drive change.
You need to consider that a bad case often has many things that are driving the outcome including the mixed motives that are present in the system. Sometimes things go wrong because the people involved with the claim took steps to make them go wrong.
Question: Does the legislature really care about workers’ compensation?
Answer: No. The legislature cares about money and what they do is determine which party gets to receive money and which party has to pay more money.
Question: How do we overcome personal bias to take action for the best of workers’ compensation?
Answer: The stakeholders need to do a better job educating the legislature on the intent of workers’ compensation. Most do not understand how it is supposed to work and how it is actually working. Communication is the key.