Early MRI Could Mean More Expensive Claims
In a study of work-related lower back pain claims, patients who received an early MRI had medical costs $12,000 higher and were on disability about 120 days longer than those that didn’t have the test, on average.
“One out of every five people that has fairly benign lower back pain gets an early MRI that they really shouldn’t get,” said Dr. Glenn Pransky, director of the Center for Disability research. “They then have a much higher risk to go on to receive a lot of treatments that aren’t necessarily helpful.”
Most likely, physicians have not been well-educated in the proper application of evidence-based medicine and the judicious use of MRIs in assessing back pain.” — Dr. Rupali Das, executive medical director of California’s Division of Workers’ Compensation.
Evidence-based guidelines state that MRI should not be indicated for non-specific, non-radicular lower back pain. And even in instances where “red flag” conditions exist – like severe traumatic injury or possibility for cancer or infection – guidelines suggest a month of conservative treatment before revisiting the need for an MRI.
“This study came from earlier work we had done, where we surveyed providers, giving them case scenarios and asking what they would do as their initial management of acute back pain in a workers’ comp setting,” said Barbara Webster, lead author of the recent study from the Liberty Mutual Research Institute for Safety on the early use of MRI. “And we were struck. Despite what the guidelines said, many of them would order an MRI.”
“Most likely, physicians have not been well-educated in the proper application of evidence-based medicine and the judicious use of MRIs in assessing back pain,” said Dr. Rupali Das, the executive medical director of California’s Division of Workers’ Compensation. “Physicians may be unaware of false positives and lack of specificity with MRIs. It may be easier to order a test than to counsel a patient on proper exercise and behavior. Patients also may play a role in demanding tests and some physicians may find it easier to comply with the request than to explain why a test is not needed or may actually be harmful.”
Those tendencies mean workers’ comp payers end up taking on costs for unnecessary tests and subsequent treatments dealing with issues unrelated to the original claim. That means more time away from work and more expensive claims. Workers’ comp payers may be missing an opportunity to catch inappropriate tests through utilization review, which would help produce better outcomes and contain costs.
“Our studies suggest that requests for early imaging tests should go through utilization review,” Webster said. “It’s likely that if providers are following OEM and ACOEM guidelines, it won’t be certified within the first 30 days.
Das suggested that payers start with “a carrot approach” by providing education on the existing guidelines for treatment, including initial management, and the proper indications that may warrant an early MRI.
“With the involvement of a medical director, the usage of MRIs can be measured, and inappropriate usage assessed,” he said. “Outreach and appropriate intervention should be directed at providers with a pattern of ordering tests inappropriately.”
Fee-for service payment models may incentivize physicians to order more tests, but quality and outcome-based payment proposed by the Affordable Care Act should dampen that trend.
“Many organizations are now educating their members about the proper use of radiologic tests, including MRIs,” Das said. “Hopefully younger physicians will be better educated about evidence-based practices.
MRIs can reveal age-related abnormalities, like compressed and degenerated discs in the spine, that may have nothing to do with what’s causing the back pain, Webster and Pransky said.
“In one study, MRIs found significant abnormalities in 60 percent of people sampled,” Pransky said. “Human tendency is to point to the abnormality as the cause of the pain, and suggest surgery or injection to treat it. It can be hard to dissuade people from thinking that’s not the source of the problem.”
“The natural history of many conditions causing lower back pain is that half of them will resolve themselves without the need for further imaging or surgery,” Webster said.
Is Parking Lot Stumble Compensable?
An assistant manager for a retail clothing store parked in the back lot of the shopping center near the back door of the store. When she left work, she walked to her car and put her purse on the passenger seat, and while walking around the back of the car to the driver’s side, she slipped and fell on black ice. She injured her right shoulder.
The assistant manager sought workers’ compensation benefits. The store denied the claim, arguing that the injury was not compensable because it did not occur on the store’s operating premises.
The assistant manager said that when she was hired, the store manager and a manager of the shopping center told her to park in the back lot. She admitted that other store employees parked in the front lot. Other employees said that other than during the holiday season, they received no instructions on where to park. No signs designated the back lot as an employee parking lot.
The administrative law judge found that the assistant manager’s injury did not occur within the store’s operating premises and was not compensable. The Workers’ Compensation Board reversed, finding that even though the store had no control over the parking lot, it controlled where employees parked. The board found that the assistant manager’s injury was within the store’s operating premises.
The store appealed.
The court explained that in determining whether a parking facility is within an employer’s parking premises, it considers: 1) whether the employer directly or indirectly owns, maintains, or controls the parking facility; 2) whether the employer designated where in the parking facility its employees are to park; 3) whether the employee parked in the designated area; and 4) whether the employee was taking a reasonable path from her car to her workstation when injured.
The parties agreed that the store did not own the parking facilities and had no obligation to maintain the facilities. No evidence showed that any parking spaces were specially allocated to the store. Also, no evidence showed that the store had any influence over the shopping center’s maintenance of the parking facilities. The court found that the store exercised no control over the parking facilities.
B is incorrect. Although the assistant manager said she had been told to park in the back lot, other employees said they received no such instructions. The court concluded that the store did not tell employees where to park.
C is incorrect. A dissenting judge opined that the store had indirect control over the parking lot. However, the majority concluded that the store had no control over the parking lot.
How the court ruled: A. The Kentucky Supreme Court held that the assistant manager was not entitled to benefits for her injuries. Hanik v. Christopher & Banks, No. 2012-SC-000791-WC (Ky. 06/19/14).
Editor’s note: This feature is not intended as instructional material or to replace legal advice.
A Modern Claims Philosophy: Proactive and Integrated
According to some experts, “The best claim is the one that never happens.”
But is that even remotely realistic?
Experienced risk professionals know that in the real world, claims and losses are inevitable. After all, it’s called Risk Management, not Risk Avoidance.
And while no one likes losses, there are rich lessons to be gleaned from the claims management process. Through careful tracking and analysis of losses, risk professionals spot gaps in their risk control programs and identify new or emerging risks.
Aspen Insurance embraces this philosophy by viewing the data and expertise of their claims operation as a valuable asset. Unlike more traditional carriers, Aspen Insurance integrates their claims professionals into all of their client work – from the initial risk assessment and underwriting process through ongoing risk management consulting and loss control.
This proactive and integrated approach results in meaningful reductions to the frequency and severity of client losses. But when the inevitable does happen, Aspen Insurance claims professionals utilize their established understanding of client risks and operations to produce some truly amazing solutions.
“I worked at several of the most well known and respected insurance companies in my many years as a claims executive. But few of them utilize an approach that is as innovative as Aspen Insurance,” said Stephen Perrella, senior vice president, casualty claims, at Aspen Insurance.
“We do a lot of trending and data analysis to provide as much information as possible to our clients. Our analytics can help clients improve upon their own risk management procedures.”
– Stephen Perrella, Senior Vice President, Casualty Claims, Aspen Insurance
Utilizing claims expertise to improve underwriting
Acting as adviser and advocate, Aspen integrates the entire process under a coverage coordinator who ensures that the underwriters, claims and insureds agree on consistent, clear definitions and protocols. With claims professionals involved in the initial account review and the development of form language, Aspen’s underwriters have a full sense of risks so they can provide more specific and meaningful coverage, and identify risks and exclusions that the underwriter might not consider during a routine underwriting process.
“Most insurers don’t ever want to talk about claims and underwriting in the same sentence,” said Perrella. “That archaic view can potentially hurt the insurance company as well as their business partners.”
Aspen Insurance considered a company working on a large bridge refurbishment project on the West Coast as a potential insured, posing the array of generally anticipated construction-related risks. During underwriting, its claims managers discovered there was a large oil storage facility underneath the bridge. If a worker didn’t properly tether his or her tools, or a piece of steel fell onto a tank and fractured it, the consequences would be severe. Shutting down a widely used waterway channel for an oil cleanup would be devastating. The business interruption claims alone would be astronomical.
“We narrowed the opportunity for possible claims that the underwriter was unaware existed at the outset,” said Perrella.
Risk management improved
Claims professionals help Aspen Insurance’s clients with their risk management programs. When data analysis reveals high numbers of claims in a particular area, Aspen readily shares that information with the client. The Aspen team then works with the client to determine if there are better ways to handle certain processes.
“We do a lot of trending and data analysis to provide as much information as possible to our clients,” said Perrella. “Our analytics can help clients improve upon their own risk management procedures.”
For a large restaurant-and-entertainment group with locations in New York and Las Vegas, Aspen’s consultative approach has been critical. After meeting with risk managers and using analytics to study trends in the client’s portfolio, Aspen learned that the sheer size and volume of customers at each location led to disparate profiles of patron injuries.
Specifically, the organization had a high number of glass-related incidents across its multiple venues. So Aspen’s claims and underwriting professionals helped the organization implement new reporting protocols and risk-prevention strategies that led to a significant drop in glass-related claims over the following two years. Where one location would experience a disproportionate level of security assault or slip & fall claims, the possible genesis for those claims was discussed with the insured and corrective steps explored in response. Aspen’s proactive management of the account and working relationship with its principals led the organization to make changes that not only lowered the company’s exposures, but also kept patrons safer.
World-class claims management
Despite expert planning and careful prevention, losses and claims are inevitable. With Aspen’s claims department involved from the earliest stages of risk assessment, the department has developed world-class claims-processing capability.
“When a claim does arrive, everyone knows exactly how to operate,” said Perrella. “By understanding the perspectives of both the underwriters and the actuaries, our claims folks have grown to be better business people.
“We have dramatically reduced the potential for any problematic communication breakdown between our claims team, broker and the client,” said Perrella.
A fire ripped through an office building rendering it unusable by its seven tenants. An investigation revealed that an employee of the client intentionally set the fire. The client had not purchased business interruption insurance, and instead only had coverage for the physical damage to the building.
The Aspen claims team researched a way to assist the client in filing a third-party claim through secondary insurance that covered the business interruption portion of the loss. The attention, knowledge and creativity of the claims team saved the client from possible insurmountable losses.
Modernize your carrier relationship
Aspen Insurance’s claims philosophy is a great example of how this carrier’s innovative perspective is redefining the underwriter-client relationship. Learn more about how Aspen Insurance can benefit your risk management program at http://www.aspen.co/insurance/.
Stephen Perrella, Senior Vice President, Casualty, can be reached at Stephen.email@example.com.