Archives for June 2017

Work Comp Schedule Rating Factor Use It or Lose It @Policy Commences

June 28, 2017 By JL Risk Management Consultants

Work Comp Schedule Rating Factor Highly Negotiable Before Start of Policy

Search For The Work Comp Schedule Rating Factor. Why do we want to search for it? Because your company may be leaving negotiable premiums on the table, so to speak. Ok, Workers Comp policy wonks, this article was produced as a generic article as there are many deviations to Schedule Rating Factor throughout the states.

Paperwork bundles Work Comp Schedule Rating Factor File Folder

Wikimedia Commons – Tony Webster

What Is the Schedule Rating Factor? Let’s find it first. Get our your Workers Comp policy. You know, the thing the agent sent you that you filed away at the start of your policy. I will wait. Hmmmmm…….hhhhhmmmmm………hhmmmmm……hhhhmmmmmm. Ok, so you found your Workers Comp policy. If you found it quickly, you are ahead of the game.

The first page of the policy after the agent’s generic cover letter starts the Declarations Page(s). The parts of any policy – even non-workers comp ones–have DICEE for any acronym.

The five parts are:

Declarations
Inclusions
Conditions
Exclusions
Endorsements

Let us stay with the first one. I actually produced that list to give anyone that was slow on locating the policy a little more time. OK, now to the Dec Page.

Do you have your highlighter? – #1 Best Policy Review Tool, well get it out.

Now, start going down the right side of the Declarations Page. Do you see where you have your Classification Codes, Rates, Etc. Keep going down the page until you see Schedule Rating Factor . It is almost at the bottom.

Negotiable Instrument Act Work Comp Schedule Rating Factor Picture

kn.m.wikipedia.org – Rubiya mercy

What is your Work Comp Schedule Rating Factor? Did you know that it was negotiable at the START of the policy. You are too late now. Hey, do not look at me. I could have helped you with this at the renewal. Well, you can try to negotiate it on your next policy, or call or email me BEFORE your next policy renews.

The Schedule Rating Factor can swing policies 25% Debit (not good) or 25% Credit (very good). Where is this secret document that covers how these are based? The Rating Bureaus or if you follow this link, I listed some generic ones in a previous article.

Also, I include some of the terms in most of my presentation slides. Search for the word “presentations” in the box at the top right of any page. You will see Presentation Slides on the top search result.

All of the considerations are safety-related. Usually, the first one on the list is Housekeeping. Imagine, a clean workplace is a safe workplace. The Factor is an arbitrary factor between an employer and insurance carrier.

Why did I bring this up today? A company (still litigated, so no names here) just found out in Federal Court that the Rating Factor cements itself to the policy one you sign off on it. No matter what happens later on in your policy year, usually nothing can change your Work Comp Schedule Rating Factor.

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Virginia Medical Fee Schedule Now Reality After Decade

June 27, 2017 By JL Risk Management Consultants

Virginia Medical Fee Schedule Finally Enacted

The lack of a Virginia Medical Fee Schedule has long been a concern of mine and many of the Dominion State’s employers. Fee schedules do save a large amount of Workers Comp dollars while still ensuring that injured employees receive the best medical care possible.

medical billing Virginia Workers Comp Fee Schedule Infographic

Wikimedia Commons – Dynamas2002

I covered the lack of a Virginia medical fee schedule in a number of articles. Some of the articles were:

WCRI (Workers Compensation Research Institute) and NCCI agree that Medical Fee Schedules Reduce Costs. Some of the Virginia articles from those two organizations are:

Medical Fee Schedules – 43 State WCRI Report
Virginia’s Decision on Medical Fee Schedules -Do Nothing Cost Employers Extra 13%
Virginia Has The Highest Medical Cost Per Claim

The Virginia Workers Compensation Commission:

Hand Presenting Virginia Medical Fee Schedule People Icon Around The Small Globe

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HB378 Workers’ compensation; fee schedules for medical services directs the Workers’ Compensation Commission to adopt regulations establishing fee schedules setting the maximum pecuniary liability of the employer for medical services provided to an injured person pursuant to the Virginia Workers’ Compensation Act, in the absence of a contract under which the provider has agreed to accept a specified amount for the medical service. The regulations implementing the fee schedules shall become effective on January 1, 2018.

If one wants to read about the full Virginia Fee Schedule timeline, click here.

According to the Summary on HB378, some of the concerns on the Virginia Fee Schedule are:

PPO Networking Stacking
The required reimbursement will be 100 percent of the provider’s charges if the employer unsuccessfully contests the compensability of the claim.
Pharmaceutical and Durable Medical Equipment Costs

Sometime in 2019, I will publish an article on the effects of HB378.

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Is This Holy Grail For Opioid Epidemic? (Breaking News)

June 27, 2017 By JL Risk Management Consultants

Use Among Mentally Ill May Be Key To Opioid Epidemic

The opioid epidemic has reached massive proportions over the last few years. Researchers and pundits searched for the key to why such a high use level among the US and World populations.

Wikimedia Commons – Patric Hagmann by was_a_bee.

Opioids dominated much of the Workers Comp pharmaceutical discussions for years.

I came across a research paper and associated article by the Kaiser foundation. Mental illness affects 16% of the US population. However, 16% of the population accounts for 51% of all opioid use.

The numbers mean that the population with a mental illness uses opioids at a rate 318% higher than the general population – wow!

One area the article focuses on is that alternative therapies should be the focus of pain reduction – behavioral intervention.

Study Executive Summary

Background: The extent to which adults with mental health disorders in the United States receive opioids has not been adequately reported.

workers comp opioid epidemic hydrocodone

Wikimedia Commons – Ben Mills

Methods: We performed a cross-sectional study of a nationally representative sample of the noninstitutionalized U.S. adult population from the Medical Expenditure Panel Survey. We examined the relationship between mental health (mood and anxiety) disorders and prescription opioid use (defined as receiving at least 2 prescriptions in a calendar year).

Results: We estimate that among the 38.6 million Americans with mental health disorders, 18.7%(7.2 million of 38.6 million) use prescription opioids. Adults with mental health conditions receive 51.4% (60 million of 115 million prescriptions) of the total opioid prescriptions distributed in the
United States each year. Compared with adults without mental health disorders, adults with mental health disorders were significantly more likely to use opioids (18.7% vs 5.0%; P < .001). In adjusted analyses, having a mental health disorder was associated with prescription opioid use overall (odds
ratio, 2.08; 95% confidence interval, 1.83–2.35).

Conclusions: 16% of Americans who have mental health disorders receive over half of all opioids
prescribed in the United States. Improving pain management among this population is critical to
reducing national dependency on opioids. ( J Am Board Fam Med 2017;30:000 – 000.)

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North Carolina Supreme Court Decision 4 Work Comp Claims All States

June 15, 2017 By JL Risk Management Consultants

North Carolina Supreme Court Ruling On Medical Treatment Denial After Initial Acceptance

The North Carolina Supreme Court has ruled on denying a medical condition after the claim was accepted. The link to the decision can be found at the end of this article. The file is in PDF format. The North Supreme Court decided in favor of the plaintiff . The case centers on the Parson presumption in a prior case revolving around the filing of the North Carolina Industrial Commission Form 60.

graphic north carolina supreme court scales

Wikimedia Commons – DTR

You should review this case even if you do not have interests in or have workers in North Carolina. I expect to see this ruling again in other states.

In North Carolina, The Form 60 basically represents the employer and carrier or self insured and Third party administrator admit compensability for the claim. The Form 63 enables the claims adjusting staff to pay up to 90 days of benefits without admitting liability.

If you look at the Form 60 and Form 63 closely you will immediately see the Form 63 gives the claims staff enough time to thoroughly investigate a claim before acceptance. Much debate occurs with the choice of what form to use. In my old claims adjusting days, I chose the Pay Without Prejudice Forms as much as possible. New Hampshire was the first time I had seen a Pay Without Prejudice Form.

Leading defense law firms discouraged the use of the Form 63 when I asked them. One statistic that stands out is that the claims were later denied by me less than 1% of the time.

The North Carolina Supreme Court ruled that once the employer/carrier or self insured/TPA accepts the claim and the employee proves an underlying medical condition was related – the injured employee’s claim for the specific medical treatment cannot be denied later in the claim.

Picture Of North Carolina Supreme Court Room

Wikipedia – John L Marino

**Please note that I am making a few assumptions as without the claim file to review, one must be very light on their opinions of how the case was handled. I am not asserting a claims handling opinion.

Some defense attorneys deem this case as one of the most significant decisions in Workers Comp for the last 30 years.

One that comes to mind for me was the 1994 North Carolina Supreme Court decision that erased the Statute of Limitation on all Workers Comp claims for medical treatment. The State Legislature later changed that one. One of the Supreme Court justices in 1994 said the case was social legislation. The big concern was the Workers Comp rating system was not built for this type of claim medical treatment alterations.

The North Supreme Court conclusion is below. The link to the decision is here. This is one to print or save to your desktop and read.

The case of

Female Judge North Carolina Supreme Court Holding Hammer

JOHNNIE WILKES, Employee
v.
CITY OF GREENVILLE,
Employer, SELF-INSURED

(PMA MANAGEMENT GROUP, Third-Party Administrator)

Conclusion

In sum, we hold that the Commission erred in failing to give plaintiff the benefit of a presumption that the additional medical treatment he sought was for conditions related to his compensable injuries. The Commission will reevaluate its decision, applying the correct presumption. As the Court of Appeals correctly addressed this error, we affirm on this issue. On the issue of plaintiff’s entitlement to additional disability benefits, we hold that the evidence raises factual issues regarding the effect of plaintiff’s compensable tinnitus on his ability to earn wages, and that, on remand, the Commission must find these facts. Accordingly, on this second issue we modify and affirm the decision of the Court of Appeals. We remand
this case to the Court of Appeals for further remand to the Commission for further proceedings not inconsistent with this opinion.
AFFIRMED IN PART; MODIFIED AND AFFIRMED IN PART, AND REMANDED.

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Insurance Policy = Contract Between Your Company and Carrier

June 14, 2017 By JL Risk Management Consultants

Read Your Insurance Policy On Receipt To Save Headaches

Your insurance policy equals a contract between you/your company and your insurance carrier. This applies to Workers Comp policies even though they are usually more state-regulated than liability policies.

Three questions asked over the last two weeks that applied to an insurance policy made me decide to step outside of Workers Comp a little.

Using a highlighter, whether electronic or the one in your desk drawer, go over any policy line by line, word by word. I did this with an auto policy last weekend. Watching grass grow seemed more exciting. However, I did find a mistake in one of the policies, so I felt vindicated in reviewing the policy.

picture barn raising insurance policy rural

Wikimedia Commons – Ron Shawley

Our Workers Comp consultant interns initial training requires the college student to read all of our policies along with the various endorsements. Yes, I do not read the one for the businesses, the interns read them over. They learn bucket-loads of knowledge. Many compile a list of questions to ask me. So, if our interns can read them, someone can read them in your offices or at home for personal policies.

For instance, the Proof of Loss policy requirements generate so many misunderstandings

Magnifying Glass Insurance Policy With Proof Foot Print

StockUnlimited

. Yes, a claim must be filed immediately. However, almost all carriers in all states require a Proof of Loss in 60 days. FEMA provides a great explanation for Proof of Loss here. A summary is:

A Proof of Loss is a policyholder’s statement of the amount of money being requested, signed to and sworn to by the policyholder with documentation to support the amount requested. It is important to understand the Proof of Loss is not the claim.

On a side note, I decided to become FEMA flood certified this year to handle FEMA NFIP claims.

Your Workers Comp insurance policy requires no Proof of Loss. However, you should read the policy front to back or as recommended in this blog back to front. The Declarations Page counts as a few pages. The Dec Pages do not count as the whole policy. Also, read the Endorsements on your Work Comp insurance policy as you receive them throughout the policy year.

Always call or email (my recommendation) with questions on your insurance policy.

Employers Can Extend Longevity Among Older Workers, Experts Say

June 8, 2017 By JL Risk Management Consultants

Guest Author – Great Article On How Employers Can Extend Longevity Among Older Workers

Older workers have some of the best qualities an employer could want in a worker: expertise, loyalty, commitment to quality, and the ability to be outstanding mentors to others. But the physical challenges that accompany the aging process can be daunting for both the employee and the organization.

StockUnlimited

By understanding the aging process and being open to making some changes, employers can keep these valuable employees — and avoid potential litigation. Two workers’ compensation experts outlined the obstacles and opportunities available in their ‘Pearls of Wisdom, an Aging Workforce’ session at RIMS.

“Almost 20 percent of the workforce is over 65,” said Dawn Watkins, director of Integrated Disability Management for the Los Angeles Unified School District. While that number is 9 million now, it is expected to increase to about 98 million by 2060. Joining Watkins for the presentation was Darrell Brown, chief Claims Officer for Sedgwick. The two identified some of the unique risks of aging workers and ways employers can mitigate them and capitalize on their capabilities.

Stats

Older workers have the fewest number of work-related injuries, according to researchers. However, the severity costs associated with injuries of workers aged 35 and older are 50 percent higher compared to their younger colleagues. While that is partly due to higher wages, aging workers typically have more comorbid conditions and take longer to recover from their injuries.

The types of injuries also vary among different age groups. Older workers tend to have more rotator cuff and knee injuries while younger workers have more back and ankle sprains.

Vector Of Older Workers Standing At Bar Graph

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Among the physical changes that may accompany aging are the following:

Strength — a decrease of 25 to 30 percent.
Flexibility — decreases 18 to 20 percent.
Balance — 1/3 of those aged 65 and older fall each year.
Sight — all aspects can deteriorate.
Reaction time and speed — decreases.
Hearing — 1/3 of adults 65 to 74 years of age have problems.
Manual dexterity — decreases.
Body fat — increases.

“Older workers tend to have more slips, trips and falls, often due to decreased balance,” the two explained. “They also have a higher number of illness days.”

There are several specific signs that may indicate the aging process is impacting an employee. Increased fatigue, for example, or loss of patience along with irritability may be signs. An increase in minor injuries and near misses are others.

Addressing Physical Challenges

Man Running Older Workers At Bridge Mountain And Ocean View Behind

StockUnlimited

Employers can help prevent injuries among older workers through various worksite programs, according to an industry physical therapy expert. “Injury prevention programs such as stretching, body mechanics training, and general education on the types of injuries you can get on your job can really help,” said Daniel Sanchez, VP of Operations for OnSite-Physio. “They should also be shown how to do their job tasks properly to avoid injury.”

When older workers sustain injuries their recoveries may take longer due to preexisting conditions. “An underlying condition is often not mentioned by the treating physician, but it makes the recovery slower,” Sanchez said. “If you are providing physical therapy for an older person with a sprained knee and there are arthritic changes that cause the recovery to be slower you have to change your treatment approach to be less aggressive with the therapy. You don’t want to aggravate the underlying condition.”

In addition to physical activities, there are additional changes employers should consider to help their older workers. Training materials, for example, can be produced in large print to make it easier to read for those with poorer eyesight. Collaboration and knowledge can be integrated as a fundamental requirement of every job at every level. And jobs can be modified to respond to age-related changes.

Reasonable accommodation

Chronic or other medical conditions of aging workers might prompt a request for reasonable accommodation. Under the Americans with Disabilities Act, private employers with 15 or more employees are required to provide a covered job applicant or employee with a reasonable accommodation, unless doing so would pose undue hardship or direct threat.

Workers who believe they are covered may request an accommodation verbally or in writing. While there is no specific time frame, employers are advised to respond to requests as soon as possible to avoid violating the ADA. “If you can’t deal with this accommodation issue now, how will you deal with it in a deposition,” Watkins said.

Making accommodations does not need to be costly. “Modifying jobs is a great way to address reasonable accommodation,” Watkins said. “You can adjust [the job] based on the person’s needs.”

Claims administration

Man Giving Folder To Older Workers Woman At Office

StockUnlimited

Using best practices in managing all claims is the best way to avoid litigation. There are several ways that can translate to claims involving older workers.

“Be sure the treating physician is experienced with comorbidities and psychosocial issues among older people,” Brown explained. “Also, use empathy and caring. And don’t draw conclusions based on demographics, including the age of the claimant.”

Communicating with an older injured worker may involve sending a letter or initiating a phone call, rather than sending a text message. Respect, dignity, open mindedness and fairness are essential.

“We have a customer service approach to claims,” Watkins said. We return calls. We do the things we expect as consumers.”

For more information visit www.sedgwick.com or www.onsite-physio.com.

Authored by and thanks to

Nancy Grover President, NMG Consulting