A variety of medical treatments, including durable medical equipment and some medications, are driving up costs in an industry already reeling from higher than average medical expenses.
Questions for workers' comp system participants concern their medical appropriateness and cost. They are questions that are increasingly coming before employers, workers' comp insurers, and the courts.
Among the most controversial alternative treatments is therapeutic magnetic resonance. It's described as using magnets to reorganize the scattered molecules in a painful area and ostensibly reduce pain. Two wands, or probes, are used to administer electromagnetic energy through the affected area.
Evidently, TMR is not just for pain. One company's website promotes it as a treatment to tighten and tone face muscles to improve skin circulation.
TMR appeared on the workers' comp landscape about three years ago. While not in widespread use, TMR is being seen in a few states and is the subject of fraud investigations and lawsuits initiated by several major insurance carriers. The topic has become so sensitive that several people interviewed for this article agreed to do so only anonymously.
One problem for many workers' comp participants is the question of efficacy. There are few, if any, scientific, double-blind studies to confirm the validity of the treatment.
One workers' comp veteran said it seems to have a placebo effect and claimants keep returning for the treatment. A physician from the University of Pennsylvania reportedly said that magnets could have some therapeutic effect but that the magnetic waves in TMR are of such low power it does not appear it could do what it is purported to do.
Additionally, the treatment is not on the Medicare fee schedule, which is used as a basis for billing workers' comp procedures in many states. One workers' comp insurance executive estimated the excess costs of TMR to both workers' comp and auto insurance in the millions of dollars.
Other alternative medical treatments and gadgets are also raising eyebrows in the workers' comp field.
One of the most controversial issues for many states, especially California, is the use of so-called compound drugs. These are designed for patients incapable of taking a drug in the formula approved by the Food and Drug Administration; for example, someone who can't swallow a pill.
According to Judge Lachlan Taylor of the California Commission on Health and Safety and Workers' Compensation, the use of compound drugs has a necessary place in the practice of medicine, but its use in workers' comp is altogether different.
"It tends to consist of some product which may be found in an FDA approved med but is distributed in a different form," Taylor said.
Ketoprofen, for example, is approved as an ingestible anti-inflammatory medication but is used among some workers' comp providers as a topical cream that is rubbed on the skin, which has not been approved.
"We're seeing the impact of [compound drugs] on the courts," Taylor said. "Many workers' comp payers are disputing the medical necessity and reasonable cost of these, so providers are filing liens and they're choking our court system."
Taylor said the Los Angeles Office of Workers' Compensation Appeals Board is "groping for solutions because they don't have the staff or resources to adjudicate the volume coming through." He said most of the liens for compound drugs are being compromised. "The markups are so high it's profitable to do it even if they only get $0.20 on the dollar."
Problems for the system.
Establishing medical necessity of the alternative treatments can be tricky in some jurisdictions. California, for example, uses the guidelines established by the American College of Occupational and Environmental Medicine as a basis for treatment standards but gives medical providers some latitude. "There are some gaps," Taylor said. "It's taking advantage of a weak area in the medical fee schedule and the deference we'd like to pay treating physicians."
In response, California lawmakers last summer considered legislation that would have required preapproval for dispensing compound drugs. The proposal also would have defined a decision tree for medical necessity and prohibited any use of compound drugs that did not follow it. However, the measure failed to pass due to heavy opposition.
California officials hope to begin crafting a new proposal to address alternative treatments sometime in the new year. "We're working with people who have the expertise to define a solution that still respects the appropriate treatment but reduces opportunities for abuse," Taylor said.
Read more at the WorkersComp Forum homepage.
December 9, 2010
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