Nancy Grover

Nancy Grover is the president of NMG Consulting and the Editor of Workers' Compensation Report, a publication of our parent company, LRP Publications. She can be reached at

Claims Trends

Transition Costs to ICD-10 Lower Than Expected

A new survey suggests the costs for small physician practices transitioning to the ICD-10 coding system may be less than previously assumed.
By: | March 2, 2015 • 3 min read
Topics: Claims | Workers' Comp
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There’s some good news about the upcoming conversion to ICD-10. A new survey suggests the costs for small physician practices to transition to the new coding system may be less than anticipated.

As of Oct. 1, medical providers and payers will be required to use the 10th revision of the International Classification of Diseases for diagnosis coding of all transactions covered by the Health Insurance Portability and Accountability Act. Although workers’ comp is excluded from HIPAA, many organizations have urged practitioners to convert to the new coding system.


“While the transition to ICD-10-CM may not have a direct impact on workers’ compensation reporting requirements, it will affect how insurers process medical bills and claims,” noted the International Association of Industrial Accident Boards and Commissions in a previous statement. “All medical providers and most healthcare payers will be exchanging paper forms or electronic messages that contain ICD-10 codes. ICD-10-CM contains 56,000 more codes than ICD-9-CM and most medical providers will not have the administrative support to code in both systems.”

Implementation of ICD-10 has been delayed twice from the original October 2013 date and the subsequent April 2014 deadline. The cost to transition, especially for smaller physician practices, has been a concern. But responses from 276 physician practice managers to a survey by the Professional Association of Health Care Office Management and published in the Journal of American Health Information Management Association indicate that may not be as big a concern as previously thought.

“This survey found that the average ICD-10-related expenditures for a physician practice with six or fewer providers is $8,167 with average expenditures per provider of $3,430,” the report said. “Based on this survey and the two other recent studies, the financial barriers to ICD-10 are significantly less than originally projected.”

The PAHCOM, an association for managers of physician practices, noted a 2014 study by the American Medical Association that estimated costs for a small practice to convert to ICD-10 could range from $22,560 to $105,506. It said the lower costs reflected in the latest study and two other recent ones could be the result of no- or low-cost resources that are now available.

“Practice specialty-specific superbills can be downloaded at no cost from the internet,” the PAHCOM report said. “Many software system vendors are providing ICD-10 system updates at no additional cost. The adoption of electronic health records by physician practices has further facilitated the transition to ICD-10.”


Meanwhile, the issue has been a topic for members of Congress in two recent meetings. A Capitol Hill briefing on Feb. 10 was followed the next day by a hearing before the House Energy & Commerce Subcommittee on Health.

The committee has been working with the Centers for Medicare and Medicaid Services for several months to ensure this deadline is successfully met, according to panel Chairman Rep. Joseph R. Pitts, R-Pa. “Many providers and payers, including CMS, have already made considerable investments in the ICD-10 transition, and any further delay will entail additional costs to keep ICD-9 systems current, to retrain employees, and to prepare, again, for the transition.”

Nancy Grover is the president of NMG Consulting and the Editor of Workers' Compensation Report, a publication of our parent company, LRP Publications. She can be reached at
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Workers' Comp Reform

Reform Effects Causing Docs to Refuse Injured Workers

Physicians are displeased with sweeping changes to the California workers' compensation system since the passage of SB 863.
By: | March 2, 2015 • 3 min read
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“I no longer take workers’ comp cases due to the impossibility of getting paid in a timely or appropriate manner without huge amounts of extra work,” a physician reportedly wrote. Another said “expenditures appear to have shifted from patient care to a cumbersome administrative system, involving 2-4 steps in different locations across state lines, for authorization.”


Both are comments cited in a survey from the California Medical Association. The association released the responses from 231 physician practices to the changes included in workers’ comp reform legislation signed into law September 2012.

“Significant changes to the utilization review process, implementation of an independent medical review and independent bill review process along with migration to a resource-based relative value scale payment system are some of the substantial changes to the California workers’ compensation system since the passage of SB 863,” said the survey. “Feedback from the CMA physician members thus far indicates significant challenges with the workers’ compensation reforms implemented.”

The survey was conducted over a two-week period. Questions addressed utilization review, independent medical review, independent bill review, and the resource-based relative value scale fee schedule.

More than two-thirds of the respondents cited problems with the UR process in getting authorization for patient care, and more than half of those cited “inappropriate denials” of tests, procedures, or services they deemed necessary.

“The process was always difficult but has become hideous in recent months,” according to one physician’s comment. “It has become a series of denials for even the most elementary medications or tests,” said another.

“I no longer take workers’ comp cases due to the impossibility of getting paid in a timely or appropriate manner without huge amounts of extra work.” — a California physician surveyed about the impact or workers’ comp reform bill SB 863.

The IMR process was also cited as a challenge with two-thirds saying it “has been unsuccessful in ensuring approval” of care they said is medically necessary. Slow responses to IMR requests and “inappropriate denials” of medically necessary actions were cited as the biggest challenges. One-third of physicians said opioids/pain management was the type of service most frequently denied by payers. Commenters said “prescription drugs of many kinds, not just opioids” were the type of service most frequently denied.

The independent bill review process was utilized by 30 percent of respondents with 32 percent saying they “had no idea it existed.” Among those familiar with it, nearly half — 46 percent — said it was “not at all successful” in addressing issues involving payment discrepancies. The $250 submission cost per issue to use the independent bill review was cited as “cost prohibitive” by 39 percent of respondents.

The main challenge cited from the new RBRVS fee schedule was “down-coding of claims resulting in underpayment,” according to 55 percent of respondents. One said “lack of payment for non face-to-face time, telephone calls, supplemental reports. It is a nightmare.”

Meanwhile, the state Commission on Health and Safety and Workers’ Compensation is calling for a reexamination of the system in light of the passage of S.B. 863. The commission was created by legislation in 1993 to examine the health and safety and workers’ comp systems and recommend administrative or legislative changes.

In its annual report, the commission specifically cited “medical care quality, accessibility, timeliness and cost” and “timeliness and cost of dispute resolution” as two areas the legislature and administration should address.

While S.B. 863 “incorporated many of CHSWC’s previous recommendations for statutory improvements” in the workers’ comp system, the commission recommended a thorough reexamination.


“Significant changes in the medical care process for injured workers have resulted from the reforms enacted in 2012. One of the changes is that medical necessity disputes are now resolved through an IMR process,” the report said. “IMR is administered by the Division of Workers’ Compensation Administrative Director and requires that an injured worker’s objection to a UR decision be resolved through IMR.”

The CHSWC called for an evaluation of the impact of the changes on an individual provision-by-provision basis and in combination. It also suggested evaluating the impact of the new provisions “on cost, quality and access of injured workers to appropriate and timely medical care” and to “identify issues and make recommendations for addressing areas of potential concern.”

Nancy Grover is the president of NMG Consulting and the Editor of Workers' Compensation Report, a publication of our parent company, LRP Publications. She can be reached at
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Wellness Strategies

BOOCS Program Could Lower Obesity-Related Injury Risk

A Japanese model of health education among workers may hold promise for an alternative to traditional methods to help improve the well-being of the workforce.
By: | February 23, 2015 • 5 min read

Employers seeking to improve their employees’ health and reduce illnesses and injuries may want to look to a Japanese model. By instituting a unique health education program started in that country, health risks among obese workers were significantly reduced — up to 15 years later.

The program used a new method of health education among workers in the 1990s. A follow-up study published recently in the Journal of Occupational and Environmental Medicine may hold promise for an alternative to traditional methods to help improve the well-being of the workforce.


“The results indicate a mortality benefit by participation in [the Brain-Oriented Obesity Control System] program,” the study said. “For prevention of metabolic syndrome, effective measures are strongly needed in the future, and it is suggested that [the] BOOCS program will contribute to them as a new approach for health promotion.”

The follow-up study results were released as the prevalence of obese workers continues to increase. According to the study, the increase amounts to “25.1 percent for males and 23.9 percent for females in the United States as a body mass index of 30 or higher in 2003 to 2009, and 28.5 percent for males and 11.6 percent for females in Japan as a BMI of 25 or higher in 2011.”

Along with the increase in BMI is a higher risk of metabolic syndrome, which increases the risk of cardiovascular disease, especially heart failure, as well as diabetes. Metabolic syndrome is defined as a disorder of energy utilization and storage, diagnosed by a co-occurrence of three out of five conditions, including abdominal obesity, elevated blood pressure, elevated fasting plasma glucose, high serum triglycerides, and low high-density cholesterol levels.

“Hazard ratios were calculated with survival curves drawn to evaluate the mortality effects by the program participation,” according to the report. “The results support a protective effect on mortality by participating in [the] BOOCS program.”


Traditional approaches to behavior modification typically begin with prohibitions against unhealthy behaviors such as eating high-caloric foods, drinking alcohol, and smoking. Because of its strictness, this method “frequently results in the rebound of body weight and the appearance of [a] guilty conscience,” the report said.

BOOCS “begins with no prohibition,” the report said. It “is a unique method prioritizing the recovery from fatigue, in particular, ‘brain fatigue,’ and it eventually induces better lifestyle modification and improvement of body weight and serum lipids.”

The program includes two principles and three rules as a basis for “effective and active guidance.” The principles are “do not prohibit or order yourself as possible” and “do something pleasant for yourself.” The rules include:

  • Do not practice what you dislike even if it is good for your health.
  • Do not prohibit what you like even if it is bad for your health.
  • Do only what you like among good things and matters for your health.

The Japanese inventor of the program has said the approach “is quite useful for making the participants fully aware of the fundamentals of health promotion and disease prevention, which leads them to modify their health behavior,” according to the study. “He also insists that prohibitive and compulsive instructions are ineffective for behavior modification, and, in particular, those people who understand [the] significance of health would result in failure through such methods and fall into vicious circle such as rebounding body weight.”

The authors do not speculate on why the program works and say more research is needed. However, they point to the study results as proof that it is effective.

The Study

Public service employees working for a municipal government in Japan were introduced to a health service organization in 1992, which included health exams, seminars and guidance, and insurance programs. The BOOCS portion of the service included 10 one-day and two-day seminars annually with lectures on health care by physicians and practical exercises by professionals such as a physical instructor, a dietician, and a psychologist.

The initial study and 15-year follow-up research into an obesity program among Japanese workers included three groups. Workers who participated in the Brain-Oriented Obesity Control System were called the intervention subjects. Among the nonparticipants, comparative obese controls were those who had a body mass index of at least 25 or health problems related to obesity while reference subjects were the remainder. In the follow-up study 15 years later, the researchers identified participants who were deceased and their causes of death.

“Compared with comparative obese controls, hazard ratios for all causes were significantly lower in participants [of the BOOCS program] at 0.54,” the report said. “The “significant mortality changes” persisted during the follow-up period. “One of the reasons for such preventive effects of [the] BOOCS program may be related to improvement of obesity during follow-up.”


The authors noted that among male participants in the BOOCS program, BMIs decreased in the first five years of the study by 1 percent to 5 percent compared to both groups of nonparticipants. “These data coincide with the previous reports that both all-cause and cancer mortality were associated with obesity,” the report said. “These effects brought by [the] BOOCS program may result in the protective effect for mortality in this study.”

The results were not seen to the same extent among females. The authors speculated that it could be due to sociological factors, saying traditional gender roles remain and many women leave the workforce upon marriage or childbirth.

In conclusion, “the standardized mortality rates for all causes and all neoplasms in comparison with the general population were statistically lower among participants [in the BOOCS program] and reference subjects, which may be due to the healthy worker effect,” the study said.

Nancy Grover is the president of NMG Consulting and the Editor of Workers' Compensation Report, a publication of our parent company, LRP Publications. She can be reached at
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