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Workers’ Compensation System Slammed for Poor Quality Health Care and Failure to Innovate

November 07, 2014 (8 min read)

Thomas A. Robinson, J.D., the Feature National Columnist for the LexisNexis Workers’ Compensation eNewsletter, is a leading commentator and expert on the law of workers’ compensation.

An important, but overlooked element associated with the swelling group of Americans permanently removed from the workforce is the failure of Federal and state workers’ compensation systems to provide effective health care to treat non-catastrophic injuries, says a group of researchers in a recently released commentary [See Franklin, G., et al., “Workers’ Compensation: Poor Quality Health Care and the Growing Disability Problem in the United States,” American Journal of Industrial Medicine, October 2014]. The authors of the commentary argue further that innovations in workers’ compensation health care delivery and in the use of evidence-based coverage methods, such as prospective utilization review, if widely adopted, could substantially reduce avoidable disability and provide greater financial stability both for individuals and the country’s social welfare programs.

Explosion in the Number of Disabled Americans

The commentators document the tremendous growth during the past decade and a half in the number of Americans drawing SSDI benefits: in 2012, 8.8 million people were collecting disabled worker (SSDI) benefits, totaling $200 billion annually—a 75 percent increase in the number of working-age people receiving such benefits compared to 2000. The commentators posit that while the problem has received lots of attention, almost completely overlooked in the discussions and analyses is the functioning of workers’ compensation systems and the health care those systems provide and regulate.

Commentators’ Hypothesis: Workers’ Compensation Systems Are Failing to Provide Adequate Care

They point out that the mix of conditions causing permanent disabilities has significantly changed over the past several decades, but that strategies for their treatment have not.  In the early 1980s, the number of disabilities associated with cardiovascular conditions was almost twice that of disabilities associated with musculoskeletal conditions. By 2012, the ratio had fallen to 25 percent.

The commentators lament that much of the policy discussion continues to be centered on “late stage analysis,” after disability has become a fact of life. They argue that while primary prevention is undeniably important, secondary prevention, which focuses on the prevention of disability once a worker has been injured, deserves greater attention and resources.

“Risk” of SSDI Reliance Doubled From 1987 to 2010

The commentators point to an additional alarming point: While in 1987–1989, approximately 11% of all compensable workers’ compensation claims accumulated one year of disability, by 2010, the percentage had risen to 19 percent. Concomitantly, the commentators indicate the “risk” of receiving SSDI benefits doubled during the period. They posit that the likelihood of “definite” transition from workers’ compensation to SSDI benefits is perhaps three percent among compensable claims, but that the likelihood of “possible” transition among compensable claims may be as high as nine percent. It is with this six percent of “possible” transition claims that secondary prevention methods can be used to greatest advantage, say the commentators.  According to the commentators, achieving effective secondary prevention of disability in workers’ compensation will require a focus on two concerns:

1. Improved delivery of occupational best practices to workers at risk early on after injury, and

2. A reduction in ineffective or harmful health care services through evidence-based coverage policies.

Improving Health Care Delivery for Injured Workers to Achieve Secondary Prevention

The commentators point to a decade-long pilot test in Washington State that used both financial and non-financial incentives to deliver occupational health best practices to injured workers within the first few weeks following injury. With 25% of injured workers in the state participating, there was a reduction in long-term (one-year) disability by about 30 percent for low back injuries. Already expanded by 2011 legislation within the state, the Washington results could be repeated in other states.

Improved Secondary Prevention by Using Evidence-Based Coverage Policies to Improve Outcome and Prevent Harm

The commentators point to a “meta-analysis” of more than 200 studies comparing outcomes of the same surgical procedures in workers’ compensation and non-workers’ compensation health care. The studies suggest far worse recovery for injured workers in nearly every procedural category. The studies did not point out why an injured worker tended to be worse off than a patient with a similar physical issue treated outside the comp system.  The commentators, however, suggest three specific examples of potentially inappropriate medical care prevalent within the workers’ compensation system:

1. Chronic opioid therapy.

2. Lumbar fusion surgery.

3. Thoracic outlet surgery for disputed neurogenic thoracic outlet syndrome.

Preventing Disability in Workers’ Compensation

The commentators conclude by suggesting that improving health care delivery with a goal of preventing persistent, long-term work disability will require meaningful quality improvement at a system level as well as changes in workers’ compensation regulations. They argue that critical to the process is the introduction—at the early stage of treatment—of effective incentives and improving care coordination. Quality improvement is necessary, but the commentators say it likely will not be enough. The workers’ compensation system itself needs improvement. More aggressive prospective utilization review with application of evidence-based guidelines, and regulatory changes, are likely needed to address the problem of poor care that places workers at risk of long-term disability.

Stuart D. Colburn, Esq., Shareholder at Downs Stanford, P.C., Austin, TX, agrees with the commentators’ points about utilization review and argues for a more robust workers’ compensation utilization review in the areas of opioids and lumbar fusions:

“Researchers recently concluded that a more robust workers’ compensation utilization review in the areas of opioids and lumbar fusions would reduce the number of SSDI applicants. Some commentators argue we are becoming a nation of disabled as evidenced by the drastic increase of those on permanent disability. A separate discussion can be had on the physiological causes of a disability mindset. Workers’ compensation stakeholders can and should aggressively limit lumbar fusions (studies show fusions are ineffective treatment for degenerative disc disease) and opioid therapy. Overutilization of narcotics is a growing epidemic requiring workers’ compensation carriers to forge new strategies to fight the business of prescribing opioids for chronic pain and the resulting addiction (and sometimes death). Easier said than done. Parties with monied interests form powerful lobbies against many reforms (think doctors, hospitals, ASCs, implant manufacturers, pharmaceuticals, pharmacies, to name a few). Stakeholders often play catch-up to the latest money-making scheme disguised as effective treatment (for example, physician dispensing and compound medications). Thomas A. Robinson is quite right: This study is an important part of an ongoing conversation; but hopefully, talk will lead to action.”

Limitations in the Commentary Analysis

While the commentators identify a number of important factors to explain the tremendous growth in the number of persons receiving SSDI benefits, particularly with regard to those who also have suffered workplace injuries or illnesses, they provide no discussion of the host of macro-economic factors that no doubt are also at work. For example, according to Department of Labor data, as of July 2012, there were 811,000 more long-term unemployed than when the recession officially ended in June 2009. By the end of 2012, the pool of Americans who are not part of the labor force had increased by 7.5 million. An injured worker may not return to work because he or she has moved to the SSDI ranks, but it may be just as likely that a former worker has sought out SSDI because there is no job to which the worker can return. While it is fair to say the workers’ compensation system can do a better job in returning injured workers to the employment world, that world is increasingly more competitive and jobs are often tenuous.

Improvements Are Possible

The workers’ compensation system can be improved, say some prominent experts in the field.  For example, Rebecca A. Shafer, JD, President of Amaxx Risk Solutions and author of Your Ultimate Guide to Mastering Workers’ Comp Costs, said:

"After spending time interviewing and reviewing claims of multiple injured workers, I agree that we can do better. Failure to return to work is, unfortunately, often the result of employers’ unwillingness to accommodate both transitional and permanent medical restrictions following an injury. Employers often do not have the knowledge to develop return to work programs; they may not even know that return to work during recovery is an option.

"Better delivery of medical care must include the use of medical review to ensure injured workers get all the medical care needed, without delay. One way to do this is to use injury triage within the first 15 minutes of an injury to advise on the proper level of care needed. Far too often we see utilization review “cost containment” services used as a club to randomly and routinely deny medical care to injured workers. That practice starts a regrettable cycle: poor care followed by longer periods of time off-work, followed by more poor care."

Additional Studies Needed

The commentators urge additional investigation, randomized trials and comparative effectiveness studies, including population-based observational studies to add insights to this important problem in our nation. Indeed, the stakes are high as some experts say we have fewer than half dozen years before the SSDI cupboard is bare. This examination of the workers’ compensation system, its apparent lack of quality in providing appropriate medical care and the growing problem our country faces with the disabled is an important part of the ongoing conversation among all groups of stakeholders.

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