Practical Solutions for a Changing Claims Environment
Many theories are emerging on the future of workers’ compensation in a rapidly changing world, but the National Workers’ Compensation and Disability Conference® & Expo built our upcoming 2015 session program mostly by focusing on existing solutions for claims payers’ current challenges.
Yet now that building the program for the 24th annual conference scheduled for November 11-13 at Mandalay Bay in Las Vegas is complete, I can also report that the lineup of 32 breakout sessions will include some forward-looking discussions.
Attendees will mostly find practical breakout-session presentations on topics like The Home Depot’s strategy for deploying nurse case managers, Southwest Airlines’ quality-assurance efforts for selecting vendor partners, and how employer Reyes Holdings applied an integrated disability and absence management approach.
Our selection group helped pick speakers often by favoring presentation proposals containing pragmatic solutions to the problems they and their industry colleagues face or see as emerging issues needing greater clarity.
The selection group included Denise Algire, director, managed care & disability corporate risk, Safeway Inc.; Bill Wainscott, manager workers’ compensation & occupational health, International Paper; Dan Reynolds, editor-in-chief, Risk & Insurance; and myself.
Like the rest of society, though, workers’ comp is seeing many technology-driven changes and more lie ahead, of course. That is driving thought-provoking, insurance industry discussions on topics such as how the future face of employment and increased use of robotics will impact underwriters.
Those are important considerations. But there remains a need to help workers’ comp professionals understand current applications for technology the industry is still coming to grips with, like the application of predictive analytics.
That is why the National Workers’ Compensation and Disability Conference® & Expo will provide sessions like one to be led by ESIS, explaining the industry’s data analytics and predictive modeling capabilities. The presentation will be backed by Georgia Pacific explaining of how it has actually applied the tools to improve claims results.
We did not, however, ignore discussions on emerging changes.
Sedgwick Claims Management Services Inc. and Harbor Health Systems, for example, will discuss evolving medical management topics such “accountable care, value-based pricing and patient engagement.” But with an eye to the practical, the session will also include a senior workers’ comp manager from Boeing sharing how the company’s current practices align with the expected shifts in healthcare delivery.
Our breakout sessions also look to enlighten on controversial topics impacting the workers’ comp industry. Attendees will have the opportunity to hear two opposing views on the movement pushing for more states to allow employers to opt out of their traditional workers’ comp systems as is currently allowed in Texas and Oklahoma.
The full conference agenda will be available online June 21.
But here is a sneak peak at what the agenda will include:
- Walmart and PRIUM sharing the retailer’s efforts to manage pharmaceutical misuse
- Pacific Gas and Electric’s adoption of a 24/7 telephonic injury management program
- LifeTEAM Health and a Kaiser Permanente medical director describing the results from helping injured employees overcome psychosocial risks with a biopsychosocial strategy
- A discussion on workplace violence, causation, mental trauma and prevention
- Explanations of strategies and available tools for administering the Americans with Disabilities Act and leave laws such as the Family Medical Leave Act.
- A Hyatt Hotels senior occupational health manager on practices for injury prevention, early intervention, and claim-severity mitigation.
It’s an agenda built with an aim to meet the needs of a cross section of workers comp and disability management professionals, including medical providers, attorneys, claims managers and risk management department leaders.
Workers’ Comp Docket
Traveling Employee’s Collision With Wild Hog Is Compensable
Choctaw Resort Development Enterprise v. Applequist, No. 2014-WC-00969-COA (Miss. Ct. App. 04/21/15)
Ruling: The Mississippi Court of Appeals held that an off-property casino director was entitled to benefits for the injuries she sustained in a car accident.
What it means: In Mississippi, a traveling employee is within the course of employment from the time she leaves home until she returns unless she deviates from her work task on a personal errand.
Summary: An off-property director of player development for a casino worked from her home when she was not traveling, hosting events, or surveying competing bingo halls. She had no fixed employment hours but often worked long hours. She traveled to three new bingo facilities to survey them. The director had only lived in the area for a few weeks, so she asked her sister to accompany her. They left the last casino around 4 a.m. to return home. The director’s sister was driving in a rain storm when their car hit a 400-pound wild hog. The director was injured and hospitalized for several days. She sought workers’ compensation benefits. The Mississippi Court of Appeals held that she was entitled to benefits.
The court explained that travel was a large part of the director’s work. Her boss explained that her job duties included investigating competing gaming operations. The court agreed with the Workers’ Compensation Commission that the director was not on a personal errand when she was injured. She explained that she inspected the gaming operations for their size and location, amenities, and whether their parking lots were full.
The director explained that she asked her sister to drive because she was more familiar with the area. The 68-year-old director also claimed to have taken prescription medication.
The casino asserted that the director did not request reimbursement for her travel on the day of the accident. The director explained that she received travel advances.
Temp Worker’s Injury Covered Under General Liability Policy
Broom v. Wilson Paving & Excavating, Inc., et al., No. 109813 (Okla. 04/07/15)
Ruling: The Oklahoma Supreme Court held that a temporary worker’s injury from a collapsed trench was covered by a subcontractor’s general liability insurance policy.
What it means: In Oklahoma, a temporary worker’s injury can be covered by a subcontractor’s general liability insurance policy when he was an employee of, and received workers’ compensation from, the employment agency.
Summary: A temporary worker went to the offices of Labor Ready, an employment agency, to secure employment. The worker was directed by Labor Ready to work with Wilson Paving. He began work laying pipe inside a trench. The trench in which he was working collapsed, covering him in dirt to his neck. He sustained serious injuries. The worker received workers’ compensation benefits from Labor Ready. He also sued Wilson Paving for his injuries. Wilson Paving had two insurance policies — one for workers’ compensation and liability to employees and a general liability policy that covered injuries to the public. The Oklahoma Supreme Court held that the worker’s injury was covered by Wilson Paving’s general liability policy.
The general liability insurer argued that the worker was not covered under the policy as a temporary worker because there was no agreement granting coverage to a temporary worker. The court pointed out that the policy did not contain language excluding coverage injuries to temporary workers.
The court also explained that the insurer was not immune from liability under the workers’ compensation exclusive remedy provision. The worker was not considered Wilson Paving’s employee at the time of the incident. Labor Ready was identified as his employer in the workers’ compensation action. Negligence was the basis of the worker’s recovery against Wilson Paving.
The court concluded that coverage for the worker’s injuries was not precluded under the policy. The court rejected the insurer’s argument that coverage was excluded because a trench collapse was considered “earth movement” under the policy. The court found that the policy excluded coverage for naturally occurring earth movement such as earthquakes and landslides but several of the terms within the provision such as slipping and caving could be caused by naturally occurring events or man-made events. The record indicated that Wilson Paving expected coverage in a situation such as this. The insurer was aware of the nature of Wilson Paving’s business and could have excluded man-made earth movement from coverage. The court found that the policy only excluded earth movement caused by natural events.
Actual Notice of Injury Not Enough; Worker Must File Claim
Izikson v. Protein Science Corp., et al., No. AC 36325 (Conn. App. Ct. 04/21/15)
Ruling: The Connecticut Appellate Court held that a worker failed to provide proper notice of his claim.
What it means: In Connecticut, a worker must provide written notice that informs his employer of his intent to pursue a workers’ compensation claim.
Summary: A worker for Protein Science Corp. injured his back and leg while lifting a box. He notified Protein Science’s controller of his injuries. The controller prepared a first report of injury form and transmitted it to its insurance provider, Chubb Indemnity Insurance Co. The controller advised the worker to contact Chubb directly to discuss his injuries and learn how to proceed with the matter. Chubb sent the worker a prescription card and filed a form contesting the worker’s assertion that he injured his back in the course of his employment. The worker did not file a notice of claim or request a hearing within one year of his injuries. Protein Science and Chubb did not provide him with medical treatment. Instead, the worker underwent surgery and sought payment for the surgery through his group health insurance carrier. More than one year after the injuries, the worker sought workers’ compensation benefits. The Connecticut Appellate Court held that the worker failed to provide proper notice of his claim.
The worker asserted that based on the totality of the circumstances, Protein Science and Chubb had notice that he was pursuing or intended to pursue workers’ compensation benefits. The worker asserted that Protein Science and Chubb had notice of the injury and his intent to file a claim based on the first report of injury, emails between him and the controller, correspondence from Chubb enclosing a prescription card, a schedule of weekly earnings prepared by the controller, and the form contesting the injury. The court explained that the worker failed to provide written notice of his claim. He pursued benefits through his group health care provider. He did not submit medical bills to Protein Science or Chubb and did not use the prescription card Chubb sent him.
The worker also argued that Chubb’s filing of the form contesting the injury should be an exception to the notice of claim requirement. The court disagreed, stating that the legislature was the proper forum to create additional exceptions.
Nurse’s Fall While Carrying Soiled Clothes Is Linked to Employment
Kilbane v. Lutheran Hospital-Cleveland Clinic, et al., No. 101897 (Ohio Ct. App. 04/16/15)
Ruling: The Ohio Court of Appeals held that a nurse’s fall in the parking lot at the end of her workday was compensable.
What it means: In Ohio, a causal connection exists between a worker’s injury and her employment when the worker was performing a duty for her employer’s benefit when she encountered a hazard and was injured.
Summary: A nurse for Lutheran Hospital was required to change back into her “street clothes” at the end of her workday and deposit her scrub uniform into a hospital laundry basket. As she prepared to leave work, she noticed that her lab coat and shoes were soiled as a result of her operating room duties. The hospital did not clean lab coats or shoes, so she obtained a plastic bag from the operating room and placed her lab coat and shoes inside.
The nurse then retrieved her purse and a container of food and “clocked out.” She crossed the street to the employee parking lot. While she was walking on a hill, wind captured the bag, and she stumbled and fell. The nurse sought workers’ compensation benefits. The Ohio Court of Appeals held that her injury was compensable.
The court rejected the hospital’s argument that the nurse’s injury did not occur in the scope of and arising out of her employment. The court explained that she was required to wear nursing garb while performing her duties. She was required to maintain her lab coat and shoes personally. She could do so only by taking those items with her when she left work for the day. The court said the nurse’s actions when she was injured were consistent with her contact for hire and logically related to the hospital’s business.
The court also found a causal connection between the nurse’s injury and her employment. Her fall resulted from the bag’s hindrance of her safe movement from her workplace to her car. The court explained that she was in the discharge of one of the duties placed upon her for the hospital’s benefit when she encountered a hazard.
Delayed Autopsy Report Tolls 6-Month Time Limit for Seeking Death Benefits
Sheena H., et al. v. West Virginia Office of the Insurance Commissioner, No. 13-0875 (W.Va. 04/10/15)
Ruling: The West Virginia Supreme Court of Appeals held that the six-month statute of limitations for filing a claim for death benefits was tolled until a miner’s heirs received an autopsy report indicating that his death was work-related.
What it means: In West Virginia, the six-month time limitation on filing a claim for death benefits can be tolled until the worker’s heirs receive the autopsy report finding that the worker’s death was work-related when the heirs could not have learned through reasonable diligence that the death was work-related until the autopsy report.
Summary: A coal miner suffered a work-related injury when a wrench fell from a mine’s ceiling and hit him on the head. The injury left him unconscious for one minute and resulted in a golf ball-size knot on his head. His treating physicians prescribed him pain medication.
The miner did not seek additional medical treatment for the injury, and he returned to work two days later. Nearly two years later, the miner died in his sleep. Due to the medical examiner’s delay, an autopsy report was not completed until eight months after his death.
The report declared that the miner’s death was the result of a traumatic seizure disorder that stemmed from the work-related head injury.
Six months after the autopsy report, the miner’s mother applied for death benefits on behalf of the miner’s daughter. Dependents of a deceased worker have six months from the date of the work-related death to apply for death benefits. The employer asserted that the claim was not timely filed. The West Virginia Supreme Court of Appeals held that the six-month statute of limitations was tolled until the mother received the autopsy report.
The mother argued that there was no way of knowing that the miner’s death was work-related until the autopsy report was completed. The court noted that a claim filed before the autopsy report would have been “purely speculative.” The court also said a finding that the time limitation could never be tolled was “patently unfair.”
The court found that the legislature did not intend that a worker’s heirs be completely barred from receiving death benefits where, due to the medical examiner’s delay in completing the autopsy, there was no knowledge that the worker’s death was work-related until eight months after the death, and the heirs promptly filed the claim within six months of learning that the death was work-related. The court noted that it limited its holding to when the delay was on the part of the medical examiner, not the heirs.
The employer also argued that the mother was not a proper party to file for death benefits on behalf of the miner’s daughter. The court said that when a worker or dependent of a worker is mentally or physically incapable of filing the application, it can be filed by her attorney or by a member of her family. Here, the miner’s six-year-old daughter was mentally and physically incapable to file an application for death benefits. The miner’s mother was a member of the daughter’s family, so she could file an application on the daughter’s behalf.
Teacher Connects Respiratory Problems With Dusty, Moldy Classroom
United Heartland, Inc., et al. v. Brown, No. 14-1070 (Iowa Ct. App. 04/08/15)
Ruling: The Iowa Court of Appeals held that a teacher was entitled to workers’ compensation benefits for the respiratory problems she sustained from exposure to mold or dust in her classroom.
What it means: In Iowa, a worker’s respiratory injury arises out of her employment when evidence establishes a causal connection between her injury and the moldy and dusty conditions in the building.
Summary: A teacher for Camanche Community School District taught in a windowless room with little ventilation. She recalled seeing ceiling tiles that were stained from water intrusion and believed a “buildup of dirt and grunge was an ongoing problem” at the school. She brought a humidifier into her classroom to help with her chronic cough and noticed mold on the filter. She claimed that she developed respiratory problems from exposure to mold or dust in her classroom. The Iowa Court of Appeals held that the teacher was entitled to benefits.
The court rejected the school district’s argument that the teacher did not suffer “a pulmonary function injury” related to her work. Although two doctors did not believe the teacher had asthma or a chronic impairment of the respiratory system, a pulmonologist diagnosed the teacher with an occupational lung disease, including hyper-reactive airways and shortness of breath. Another doctor found a positive methacholine challenge test to support his diagnosis of asthma. He also reviewed several air quality reports, which discussed examples of water damage to the school.
The court found that the teacher’s injury arose out of her employment. Expert evidence established a causal relationship between her injury and the conditions in the school. Water had infiltrated the roof and ceiling tiles in the school building. A doctor opined that the water damage more likely than not was the cause of the teacher’s lung injury. Indoor air testing pointed to heavy dust accumulation and elevated levels of carbon dioxide from low ventilation in the building.
The court also pointed out that other teachers experienced sinus and respiratory problems when they were in the building during the school year, which dissipated when they were away from the building.
Mitigating Fraud, Waste, and Abuse of Opioid Medications
There’s a fine line between instances of fraud, waste, and abuse. One of the key differences is intent and knowledge. Fraud is knowingly and willfully defrauding a health care benefit program for personal gain or profit. Each of the parties to a claim has opportunity and motive to commit fraud. For example, an injured worker might fill a prescription for pain medication only to sell it to a third party for profit. A prescriber might knowingly write prescriptions for certain pain medications in order to receive a “kickback” by the manufacturer.
Waste is overuse of services and misuse of resources resulting in unnecessary costs, whereas abuse is practices that are inconsistent with professional standards of care, leading to avoidable costs. In both situations, the wrongdoer may not realize the effects of their actions. Examples of waste include under-utilization of generics, either because of an injured worker’s request for brand name medication, or the prescriber writing for such. Examples of abusive behavior are an injured worker requesting refills too soon, and a prescriber billing for services that were not medically necessary.
Actions that Interfere with Opioid Management
Early intervention of potential fraud, waste, and abuse situations is the best way to mitigate its effects. By considering the total pharmacotherapy program of an injured worker, prescribing behaviors of physicians, and pharmacy dispensing patterns, opportunities to intervene, control, and correct behaviors that are counterproductive to treatment and increase costs become possible. Certain behaviors in each community are indicative of potential fraud, waste, and abuse situations. Through their identification, early intervention can begin.
- Prescriber/Pharmacy Shopping – By going to different prescribers or pharmacies, an injured worker can acquire multiple prescriptions for opioids. They may be able to obtain “legitimate” prescriptions, as well as find those physicians who aren’t so diligent in their prescribing practices.
- Utilizing Pill Mills – Pain clinics or pill mills are typically cash-only facilities that bypass physical exams, medical records, and x-rays and prescribe pain medications to anyone—no questions asked.
- Beating the Urine Test – Injured workers can beat the urine drug test by using any of the multiple commercial products available in an attempt to mask results, or declaring religious/moral grounds as a refusal for taking the test. They may also take certain products known to deliver a false positive in order to show compliance. For example, using the over-the-counter Vicks® inhaler will show positive for amphetamines in an in-office test.
- Renting Pills – When prescribers demand an injured worker submit to pill counts (random or not), he or she must bring in their prescription bottles. Rent-a-pill operations allow an injured worker to pay a fee to rent the pills needed for this upcoming office visit.
- Forging or Altering Prescriptions –Today’s technology makes it easy to create and edit prescription pads. The phone number of the prescriber can be easily replaced with that of a friend for verification purposes. Injured workers can also take sheets from a prescription pad while at the physician’s office.
- Over-Prescribing of Controlled Substances – By prescribing high amounts and dosages of opioids, a physician quickly becomes a go-to physician for injured workers seeking opioids.
- Physician dispensing and compounded medication – By dispensing opioids from their office, a physician may benefit from the revenue generated by these medications, and may be prone to prescribe more of these medications for that reason. Additionally, a physician who prescribes compounded medications before a commercially available product is tried may have a financial relationship with a compounding pharmacy.
- Historical Non-Compliance – Physicians who have exhibited potentially high-risk behavior in the past (e.g., sanctions, outlier prescribing patterns compared to their peers, reluctance or refusal to engage in peer-to-peer outreach) are likely to continue aberrant behavior.
- Unnecessary Brand Utilization – Writing prescriptions for brand medication when a generic is available may be an indicator of potential fraud, waste, or abuse.
- Unnecessary Diagnostic Procedures or Surgeries – A physician may require or recommend tests or procedures that are not typical or necessary for the treatment of the injury, which can be wasteful.
- Billing for Services Not Provided – Since the injured worker is not financially responsible for his or her treatment, a physician may mistakenly, or knowingly, bill a payer for services not provided.
- Compounded Medications – Compounded medications are often very costly, more so than other treatments. A pharmacy that dispenses compounded medications may have a financial arrangement with a prescriber.
- Historical Non-Compliance – Like physicians, pharmacies with a history of non-compliance raise a red flag. In states with Prescription Drug Monitoring Programs (PDMPs), pharmacies who fail to consult this database prior to dispensing may be turning a blind eye to injured workers filling multiple prescriptions from multiple physicians.
- Excessive Dispensing of Controlled Substances – Dispensing of a high number of controlled substances could be a sign of aberrant behavior, either on behalf of the pharmacy itself or that injured workers have found this pharmacy to be lenient in its processes.
Clinical Tools for Opioid Management
Once identified, acting on the potential situations of fraud, waste, and abuse should leverage all key stakeholders. Intervention approaches include notifying claims professionals, sending letters to prescribing physicians, performing urine drug testing, reviewing full medical records with peer-to-peer outreach, and referring to payer special investigative unit (SIU) resources. A program that integrates clinical strategies to identify aberrant behavior, alert stakeholders of potential issues, act through intervention, and monitor progress with the injured worker, prescriber, and pharmacy communities can prevent and resolve fraud, waste, and abuse situations.
Proactive Opioid Management Mitigates Fraud, Waste, and Abuse
Opioids can be used safely when properly monitored and controlled. By taking proactive measures to reduce fraud, waste, and abuse of opioids, payers improve injured worker safety and obtain more control over medication expenses. A Pharmacy Benefit Manager (PBM) can offer payers an effective opioid utilization strategy to identify, alert, intervene upon, and monitor potential aberrant behavior, providing a path to brighter outcomes for all.