Workers Comp Claim Denials Happen All The Time – No, Really They Do
Workers Comp claim denials occur rarely nowadays. Hold on, the title of the article is that workers comp claim denials happen all the time – did I just disagree with my own statement? No – let us look more closely at the two types of denials.
Full Claim Denials
I rarely see full claim denials in our claim reviews for clients. The definition of a full claim denial is when the claims adjuster decides that the claim is not compensable and issues a denial letter or a state-approved form.
With the expansion over the years of what constitutes an on-the-job accident, denials have become a rare bird, to say the least. Denying a claim is going to involve heavy litigation costs. The claimant is not going to just go away without seeking legal counsel.
Every claims manual that I have seen in the last 30+ years had a section on workers comp claim denials. What percentage of full claim denials have I seen in the last 10 years? I would estimate .3%.
One out of 300 claims (including medical-only claims) is fully denied. The number is not a hard statistic, but it is very close.
Partial Claim Denials
A trend that I have seen lately in claim reviews is that an injured worker will claim a body part that was never mentioned in the original claim or medical bills are submitted for treatment that was not related to the original claim. The overall claim had been accepted as compensable.
Some claim systems are sophisticated enough to catch these unrelated medical claims. Almost no unrelated medical bills end up being paid by the claims department.
The rate of workers comp claim denials that fall under this category approaches at least 5 – 7% of lost time claims. That may seem like a small number. However, I am looking at $30,000 worth of medical treatment bills on a claim that I reviewed last week for an injury that was not related to the original claim.
The Third Party Administrator’s billing system flagged it and locked the bills from payment until the adjuster reviewed the claim. With the adjuster’s 13 daily duties, expecting them to manually catch unrelated medical treatment seems unrealistic.
Most of the workers comp claim denials originate from what I call parallel medical treatment. For example, treatment for severe diabetes appears on the same bill as the medical treatment for a low-back injury.
Workers Comp Claims Denials – Fraud Disclaimer
At no time do I think any medical systems are attempting to have non-workers comp medical bills illegally pushed through the system to see if the bill will be paid by the workers’ comp claim department.
The ones I have seen are usually due to unintentional mistakes.
