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ANAHEIM, Calif. — California's workers compensation reforms have resulted in improvement in certain areas, but experts say the state still has the costliest system in the United States.
In California, where reforms were implemented in 2013, medical trends are stabilizing with fewer spine surgeries and a reduction in the use of opioids, showing that many elements of the reform effort are working, said Alex Swedlow, president of the California Workers' Compensation Institute.
When compared with other states, however, California has the highest rate and frequency of permanent and partial disability claims and has the highest workers comp premium rates in the country, he said.
Although the claim numbers are high, the state also provides injured workers with a high rate of care, according to the CWCI study of 2014 data.
The study found that 85% of all workers comp care was approved and administered quickly. The remaining 15% was approved mainly by nonphysician-level utilization review entities such as nurses and case managers, a small percentage of which went to physician utilization review.
“There is a perception in the media that insufficient care is being provided to injured workers, but this data proves otherwise,” Mr. Swedlow said last week during the CWCI's annual conference in Anaheim, California.
However, Edward Canavan, Riverside, California-based vice president of workers compensation practice and compliance at Sedgwick Claims Management Services Inc., said CWCI numbers do not include some cases that are difficult to track.
Mr. Canavan said though the data shows that only 4.2% of care is denied, it doesn't account for litigated cases, when plaintiff attorneys often add injuries not included in the original claim. For example, he said, if a worker hurts his wrist, a lawyer can add shoulder and arm issues to litigation.
“So when you talk about the 4%, it does not have the cases that are contested where there is no way to relate it back to the injury and these cases are where the perception that care is not being provided come from,” Mr. Canavan said.
Comparing California with other states, Texas had 1,209 independent medical review requests in 2015, while California had 160,000, said Amy Lee, Austin-based special adviser for the workers compensation division in the Texas Department of Insurance.
Ms. Lee attributed Texas' ability to keep review requests down to communication. Before a denial is issued, for example, the provider and the insurer's utilization review agent have a “reasonable opportunity” to have a conversation.
“Our philosophy is that the more people talk to each other, the more issues can be resolved when there is a medical dispute,” Ms. Lee said. If the denial is due to lacking medical documentation, a provider-insurer conversation can resolve that.
When modifying a preauthorization request, a peer-to-peer conversation can result in the request being approved, modified or withdrawn, she said.
“One of the things we require in Texas is that you have to have that conversation and the (utilization review) agent has to document their efforts that they tried to reach out,” she said.
For some California companies, utilization review best practices include managing initial care requests internally.
“We have a different approach,” said Denise Zoe Algire, Pleasanton, California-based national director of managed care and disability at Albertsons Safeway Inc.
“We want medical people making medical decisions, so we have nurses and examiners handling all of our (utilization review) requests in-house and authorizing internally, with about 15% going to formal physician-level (utilization review),” said Ms. Algire, who also is a registered nurse and is board-certified in occupational health, of the grocery story chain's efforts.
“But we don't necessarily draw a line in the sand about the request for approval. If the nurse is familiar with the case and knows the doctor and it's documented in a narrative, and it's clear what the doctor is requesting and it is supported by medical evidence, then we will act on that,” she said.
“The bottom line is to give workers the care that they need and get them better, but there has to be some balance and predictability and sustainability so that employers can pay for it,” Mr. Canavan said. “And you don't want doctors to feel like they aren't getting paid for doing the good that they do.”
The California Workers' Compensation Insurance Rating Bureau has proposed regulatory changes to the state's insurance commissioner, including mandatory reporting of medical-only workers compensation claims and updated experience rating values.