The most recently published guide to these ratings is systematically producing lower severity ratings.
The NCCI's study prompted me ask what can we read into this downward trend? Are workers being less impaired by injury? Do the ratings reliably predict work capacity? What would happen if these ratings never were performed?
Permanent total impairment ratings are extremely rare, about as rare as are work related fatalities. But upwards of one in six work injuries that involve at least one day of lost time eventually leads to a formal permanent impairment rating: That's a lot.
Most states formally endorse one of the six editions of the American Medical Society's guides to permanent impairment ratings for calculating permanent impairments. The sixth edition was issued in 2007 and is now used in about 12 states and for federal programs. (How the AMA assumed this role is an accident of history. Were the states collectively to issue an RFP for the next edition, there would be some interesting bidders.)
Having studied impairment rating changes in three states that adopted the sixth edition, the NCCI said that it "is unable to provide a one-size-fits-all approach to quantifying the impact from a switch to the sixth edition of the AMA Guides." However, the comparisons it made showed reductions from the 5th edition of between about 5 percent and 30 percent.
The NCCI stops short of assessing what actually drove ratings lower. Those who have looked at the issue, drawing on anecdotal experience, cite four drivers.
Medical and rehab advances play a role. Think of artificial joints. The newest edition directs the "rater" to focus more carefully on function. The bizarre practice of using the occurrence of a surgery to increase the degree of impairment is no longer used. And the rating method is better designed to control for upward creep to higher numbers.
The sixth edition ratings being written up today average around 4 percent to 7 percent. Now consider this: the vast majority of workers within this range of ratings can return to work without a pay cut, at full duty, and at modest or no job modifications. Such is the experience of workers for the Windham Group of Manchester, NH, which says it has advised on several thousand such return to work decisions.
True, the worker's permanent impairment may limit or even curtail playing her guitar proficiently. But leaving aside the business needs of the claimant and defense bars for content to argue about, why are we handing out some 100,000 or more permanent impairment ratings a year when they hardly make a lick of difference in the person's work and earnings prospects?
Permanent partial impairments ratings persist because permanent partial benefits remain in law, perhaps with a hard cap on the number of years they can be paid. I think that legislators think about what appears to be fair to the worker, not about what a rational benefit system should look like.
I called a retired business school professor and, posing a scenario, asked him if the employer, insurer or society owed this type of worker anything. Blasting through the line was a loud "absolutely."
PETER ROUSMANIERE is an expert on the workers' compensation industry. He can be reached at email@example.com.
September 15, 2012
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