There are several things that make an appropriate independent medical exam in a workers compensation case. First, make sure you know the objectives prior to scheduling the exam, says Daniel R. Miller, senior consultant at ClaimDocs L.L.C. The claims manager and the exam medical provider need to know exactly what the issues are and why the exam is being requested.

Are independent medical examinations a great workers compensation claims management tool, or are they a waste of money?

The answer is both.

The independent medical exams are medical-legal reports typically ordered by insurance companies or third-party administrators to help resolve many types of workers compensation claim disputes. There is a wide range of potential issues that arise in the course of a claim. Typical issues and potential disputes include establishing causation, the determination of return-to-work restrictions, impairment ratings, if there are permanent disability awards, whether maximum medical improvement has been reached, and the appropriateness of current and/or future medical treatment.

These issues can be resolved, in theory, by having an objective independent medical examination performed. And these exams can indeed be a great claims management tool. Other times, however, not so much.

They can be a waste of money.

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The scheduling of the exams is typically very labor-intensive, time-consuming and expensive, and it is rarely a well-managed process. Poor communications between claims examiners, independent medical exam coordinators, and exam providers is commonplace.

Often reports on the exams are not well-written, making it difficult to determine what point the medical expert is trying to make. These situations arise from multiple breakdowns in the process. And many of these exams are conducted by medical providers who are not trained or appropriately credentialed in conducting them.

Another issue can be the claims examiner who is on a “fishing expedition” and provides ineffective guidance to the independent exam medical provider in terms of what specific issues need to be addressed and why an exam is being scheduled in the first place.

Other times exam reports can state things such as, “The claimant is not currently disabled,” “not actively under treatment,” “can return to work to modified duty” and even “full duty,” “no objective medical findings to support subjective complaints,” “range of motion normal,” and “injury is the result of a pre-existing condition.” Yet these types of supposedly definitive medical statements or disability status statements often do not result in any documented claims file resolution or aren't even noted in the file summary.

One of my favorite independent medical exam report statements is “the claimant had a fight with their boss and now has a total disability for a bad back.”

There are other problems in the independent medical exam industry that don't involve outright fraud or blatant abuse. For example, the initial result may be an exam report that completely states what the payer wants them to say, such as that the “injury was not work-related” or “claimant is not disabled.” Many of these medical exam providers are well-known to workers compensation judges and/or commissions and have no credibility whatsoever, and the reputation of the insurer, self-insured employer or the claim administrator who contracted them is damaged by association.

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An independent medical exam should be, by definition, truly independent. Many experts say that it is actually very important to lose a case now and then.

A recent study by the National Insurance Crime Bureau reported the number of questionable workers compensation claims increased 28% in 2012, despite the falling claim numbers overall. The three major reasons for the increase in questionable claims are thought to be an increase of claimant fraud, the filing of claims based on prior injuries not related to the workplace, and malingering.

This study suggests that it may be time for an increased use of independent medical exams. Despite some of the major problems in the multibillion-dollar independent medical exam industry, the use of these exams can, in fact, be a great claims management tool.

There are several things that make an appropriate exam. First, make sure you know the objectives prior to scheduling the exam. Both the claims manager and the exam medical provider need to know exactly what the issues are and why the exam is being requested. The independent exam can be for one or many reasons, so be specific. If the issue is causation, go beyond simply asking if the injury is work-related. Provide specific reasons why it might not be. Make sure the independent medical exam provider has all the relevant facts, such as prior medical reports, witness statements and claimant statements.

If the exam is about return-to-work or work restrictions, provide specific job requirements, as well as be able to offer temporary modified work to meet any restrictions. Up to 80% of physicians determine return-to-work dates based on how the claimant describes job requirements. Better yet, send a video of the actual job requirements. Many times claimants grossly misrepresent their job requirements. My favorite was the claimant who told my physician friend that he had to repeatedly lift 50 pounds of hay all day. The reality was the claimant pushed a button and a machine did all the lifting. These independent medical exams should be more than a fishing expedition hoping to “catch something.” That is unlikely to happen unless the correct bait is used.

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Another important decision is the timing of the exam. Sometimes they are ordered too early in the claims process but, more often than not, they are ordered far too late.

Typically, state workers compensation laws dictate when, why and how often an independent medical exam may be requested. When in doubt, verify the state requirements. Many states are now utilizing the American College of Occupational and Environmental Medicine and related treatment guidelines. Make effective use of these guidelines. Also make sure to follow all state law requirements such as notification to state workers compensation boards, claimants and their attorneys, if represented. If the state rules are not followed, such as enough advance notice for the claimant, the independent exam may be disallowed and result in a complete waste of time and money.

Avoid using so-called “hired guns.” As previously mentioned, workers comp judges will see repeated use of medical exam providers who always side with the insurer or the employer. The best independent exams are conducted by highly credentialed board-certified specialists who are truly independent medical experts. Doctors affiliated with major medical schools and teaching hospitals carry a lot more weight than a recent graduate.

Also, it is important to use doctors who actually have thriving patient practices and are not simply independent medical exam doctors. Also make sure they are truly experts. Having an orthopedic hand specialist or knee specialist carries more weight than simply a generalist physician.

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Other rules of thumb include establishing an excellent working relationship with your vendors and providers. Clear, concise communications are essential.

Remember to choose when, why and with whom to schedule an independent medical exam wisely. Few workers comp claimants and their doctors are committing outright fraud. Most are not, but unfortunately some are.

Your independent medical exam provider's report can be a great claims management tool or a complete waste of time and money.

Daniel R. Miller is a senior consultant at ClaimDocs L.L.C. in Chicago. He can be reached at dmillerymd@aol.com or 508-545-0188.