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Texas Monitor, 1:4 (Winter 1996)

   



   

The Texas Workers' Compensation Commission and the Research and Oversight Council recently completed a joint project that surveyed injured workers with permanent impairments. One of the goals of the survey was to determine the percentage of those workers who are unable to return to work because of the lasting effects of their injury, but are not eligible for continued income benefits.

In addition, the study looked at post-injury return-to-work patterns in terms of critical factors such as final impairment rating, age, education, and part of body injured in order to get a more accurate picture of which groups of workers are having difficulty finding employment after their injury.

For the purposes of defining post-injury employment patterns, injured workers are categorized into three main groups:

  1. those who never returned to work following their injury and their unemployment was due to their injury;
  2. those who returned to work at some time after their injury but are not currently working due to the injury; and
  3. those who are currently working.

Return-to-Work Patterns

Two-thirds (66 percent) of the injured workers surveyed indicated that they are currently working. Seventeen percent noted that they never returned to work after their injury. The remaining 17 percent of the injured workers said they are not working now, but they did return to work at some point after their injury.1    (See Figure 1, Return-to-Work Patterns for Workers Injured in 1993: Claimants with Impairment Ratings of 8 to 14 Percent.)   

It is the 34 percent of the injured workers who are not currently working due to their injury that is of greatest concern because their workers' compensation (WC) income benefits have completely run out and they are entitled to no further income benefits through the WC system. It is these workers who appear to have "slipped though the cracks" and may be in need of further assistance.

Impairment Rating

When the injured workers are grouped by impairment rating, some differences in their post-injury work experiences are evident. Depending on the exact degree of impairment, between 69 and 77 percent of injured workers with impairments in the 8 to 10 percent range reported that they are currently working. Injured workers with higher impairments of 11 to 14 percent had considerably worse return-to-work results. Between 55 and 61 percent of these more highly impaired workers reported that they are currently working. (See    Table 1 (Return-to-Work Patterns by Impairment Rating).)

From these data, it is apparent that there is a relationship between impairment rating and post-injury return to work. Furthermore, there seems to be a big change in employment experience as injured workers move from the 10 percent to the 11 percent impairment rating level. This substantial change is followed by somewhat of a leveling off for injured workers with impairment ratings between 11 and 14 percent.

Education

The survey data also indicate that the injured worker's level of education is related to his or her post-injury work experiences. Those with the lowest level of schooling (less than an 8th grade education) had by far the most trouble returning to work. Only 36 percent of these workers are currently employed, compared to 62 percent of those workers with a high school degree and 71 percent of those workers with some technical training or college course work completed. By the same token, the percentage of injured workers never returning to work also declines substantially as the level of education increases.

Age

Differences in return-to-work patterns were also observed when injured workers were grouped by age. The best return-to-work experience was observed among those workers 18 to 25 years of age. Ninety-four percent of this group indicated that they are currently working and there were no survey respondents of this age that noted that they never returned to work after the 1993 injury.

Workers 26 to 55 years of age had similar post-injury return-to-work patterns (64 to 69 percent currently working).

The poorest return-to-work experience was observed among the oldest group of injured workers surveyed (over 55 years of age), where just 36 percent said the y were currently working and 36 percent said they never returned to work following their 1993 injury.

Body Part

The body part injured was also found to have a significant effect on the return-to-work experience of permanently impaired workers. For example, 58 percent of workers with back injuries are currently working, compared to 64 percent of workers with upper extremity injuries, 75 percent of workers with lower extremity injuries, and 70 percent of workers with all other injuries.

In turn, 22 percent of the workers with back injuries never returned to work compared to 15 percent of the workers with upper or lower extremity injuries, and 15 percent of the workers with all other injury types.2   

Concluding Observations

It is clear from this analysis that there are a substantial number of injured workers in Texas, with impairment ratings in the 8 to 14 percent range, who are unable to return to work following their on-the-job injuries and are clearly in need of further assistance through the workers' compensation system. More specifically, the data indicate that injured workers with impairment ratings of 11 to 14 percent tend to have much more difficulty in returning to work that those with ratings of 8 to 10 percent. Other factors considered which were found to be significantly associated with a lower probability of successful return to work are age (over 55 years old), education (not a high school graduate), and body part injured (back injuries).

This article is based upon a report, An Analysis of Texas Workers with Permanent Impairments. If you would like to order a full copy of this report, please return to our publication form.


   

Ratings of permanent impairment are among the most common issues disputed in the WC dispute resolution system. For 1993 injuries with final impairment ratings of 8 to 14 percent, impairment rating was an issue in 65 percent of all claims with disputes. The party requesting dispute resolution was the employee3    in 63 percent of the cases.

Disputes over the date of maximum medical improvement (MMI) are highly related to impairment rating disputes because an impairment rating is valid only if the associated MMI date is valid. Issues involving an impairment rating and/or the date of MMI were present in 73 percent of all disputes for this group of claims. (See    Table 2 (Percentage of Disputed Cases by Issues Raised))

Reasons For Disputing Impairment Ratings

Statistical analyses found several factors to be related to whether a claim was involved in a dispute over impairment ratings. Claims with higher levels of impairment ratings; claims involving lower wage employees; and claims with large disparities between impairment ratings (when two or more ratings were given for the same injury), were all associated with higher rates of disputes over the degree of impairment.

There were only slight variations in the rates of impairment rating disputes when claims were broken down by body part injured. The rate of disputes over impairment rating was 18 percent for back injuries, 16 percent for both lower or upper extremity injuries, and 21 percent for others. There was no significant relationship between the likelihood of disputing impairment ratings and the nature of injury (sprain/strain vs. other), or the claimant's region of the state.

Only about half (53 percent) of the survey respondents indicated that they knew that they had a right to dispute their impairment rating. Respondents who indicated that a dispute over their impairment rating had occurred in their case were read a list of reasons for the dispute and asked to indicate whether the reason was applicable (see    Table 3 (Survey Respondent's Reasons for Disputing Impairment Rating)). The fact that there are several reasons receiving a substantial number of responses indicates multiple areas that would need to be addressed in order to reduce the number of disputes.

This article is based upon a report, An Analysis of Texas Workers with Permanent Impairments. If you would like to order a full copy of this report, please return to our publication form.


   Impairment Ratings — The Employee Perspective

This article examines the impairment rating process from the point of view of the injured worker. Specifically, it analyzes whether injured workers received information about their impairment rating, their assessment of the fairness of the impairment ratings given, and the length of the impairment rating examination.

Generally, many injured workers reported that their 1993 injury still affects their daily lives. An overwhelming 94 percent of injured workers surveyed said that they still hurt as a result of their on-the-job injury.

Information Injured Workers Received about their Impairment Rating

Although an injured worker's impairment rating directly affects the amount of impairment income benefits (IIBs) he/she will receive, 47 percent of injured workers responded that they never received an explanation of how an impairment rating is calculated or used.4   

Of those injured workers who received an impairment rating from their treating doctor, 42 percent said that their treating doctor never told them how their impairment rating was calculated. Of those injured workers who received an impairment rating from an insurance company's doctor, 60 percent said that they never received an explanation of how their impairment rating was calculated.

Of those injured workers who received an impairment rating from a designated doctor, 51 percent5    said that the designated doctor never explained how their impairment rating was calculated.

Perceived Fairness of Impairment Ratings

Injured workers were asked whether they thought the impairment rating given to them by their treating doctor, the insurance doctor or the designated doctor was fair.

One third (35 percent) of injured workers felt that the impairment rating given by their treating doctor was unfair.

The most common reasons given by injured workers for why they felt the impairment rating given by the treating doctor was unfair included:

  • Injured worker was still in pain and the impairment rating didn't account for pain (40 percent);
  • Impairment rating was too low (31 percent);
  • Impairment rating was calculated incorrectly (13 percent);
  • Injured worker was unable to go back to work (12 percent); and
  • Exam given by the treating doctor was too short to be accurate (7 percent).

About two-thirds (67 percent) of injured workers reported that the impairment rating given to them by the insurance doctor was unfair.

The reasons given for why the impairment rating given by the insurance doctor was unfair included:

  • Injured worker was still in pain and the impairment rating didn't account for pain (27 percent);
  • Impairment rating was too low (26 percent);
  • Impairment rating was calculated incorrectly (20 percent);
  • Exam given by the insurance doctor was too short to be accurate (17 percent); and
  • Insurance doctor was biased (11 percent).

Over half (57 percent) of injured workers reported that the impairment rating given to them by the designated doctor was unfair.

The top reasons given by injured workers for why they believed the impairment rating given by the designated doctor was unfair included:

  • Injured worker was still in pain and the impairment rating didn't account for pain (30 percent);
  • Impairment rating was too low (20 percent);
  • Impairment rating was calculated incorrectly (20 percent);
  • Designated doctor was biased (17 percent); and
  • Exam given by the designated doctor was too short to be accurate (13 percent).

Length of Impairment Rating Examination

Figure 2 (Length of Impairment Rating Examination for Treating Doctor, Insurance Doctor, and Designated Doctor)    below presents a breakdown of the length of impairment rating exams given to injured workers by their treating doctor, insurance doctor, and designated doctor.

Summary

It is very apparent that many severely injured workers are not receiving sufficient information about how their impairment ratings are calculated and how their impairment rating directly affects the amount of income benefits they will receive as a result of their injury. This lack of information may not only be the cause of countless impairment rating disputes, but also affects how injured workers view the fairness of the workers' compensation system as a whole.

This article is based upon a report, An Analysis of Texas Workers with Permanent Impairments. If you would like to order a full copy of this report, please return to our publication form.


   Discrepancies in Impairment Ratings by Types of Doctors

Medical examinations for the purpose of establishing the degree of permanent impairment may be conducted by the treating doctor or by one of several types of non-treating d doctors. The doctor type is reported according to the following categories:

  • Treating: Doctor primarily responsible for employee’s injury-related health care.
  • Designated: Doctor appointed by mutual agreement of parties or by TWCC to resolve a dispute about employee’s medical condition.
  • Other: Consulting doctor, referral doctor, or other doctor licensed and authorized to examine the employee for a compensable injury.
  • Required Medical Examiner (RME): Doctor selected by carrier or TWCC to resolve questions on the appropriateness of health care, impairment, maximum medical improvement or similar issues. Designated doctors appointed by the Commission are not distinguished from those chosen by mutual agreement. RMEs assigned by an insurance carrier are commonly referred to as insurance doctors.

This article uses indemnity claims with injury and claim establishment dates between July 1, 1994 and November 7, 1996 to examine the number of evaluations conducted by different doctor types, and to compare impairment ratings for the same injury when ratings were received from more than one doctor type. 6    Table 4 (Frequency of Evaluations Submitted by Doctor Type)    shows the number of evaluations conducted by different doctor types.

Do ratings differ depending on type of doctor? Ratings by different types of examiners were compared by computing the differences between ratings on claims in which a rating was received from more than one type of doctor. Table 5 (Distribution of Differences in Impairment Ratings between Different Types of Medical Examiners)    shows the distribution of differences between ratings from different doctor types. Other doctors, typically referral doctors, are considered the same as treating doctors for some comparisons, as indicated in the table.

Table 5 shows that insurance doctors tend to provide lower ratings than treating doctors when a claim has a rating from both a treating doctor and an insurance doctor. Insurance doctors also tend to provide lower ratings than designated doctors when a claim has a rating from each of these types. Ratings assigned by treating and designated doctors tend to be close, though treating doctors, on average, show a slight tendency toward higher impairment ratings than designated doctors. The percentile distribution shows that both the direction and size of these difference varies a good deal. In many cases the insurance doctor gave higher ratings than treating or designated doctors.

Table 6 (Distribution of Differences in Impairment Ratings between Different Types of Medical Examiners, for Claims with One Rating From Each of the Three Doctor Types)    shows average differences between ratings from different types of examiners when the same injury had been rated by all three types of examiners. Only cases with one rating from a treating doctor, one from an insurance doctor, and one from a designated doctor are used in these comparisons. The average differences tend to be larger than those in Table 5 because these injuries tended to have higher ratings.

Summary

Based on this analysis it is clear that there are marked differences in the impairment ratings being assigned by treating, insurance, and designated doctors. Furthermore, the impairment ratings assigned by treating and designated doctors tend to be fairly close and, on average, higher than those assigned by insurance doctors.


   Survey of Doctors Who Participate in Workers’ Compensation

The Research and Oversight Council (ROC) undertook a survey of Texas doctors in October 1996. To maximize familiarity with the WC system, a sample was drawn from all doctors who had given twenty-five or more impairment ratings7    in WC cases. All parts of the state were represented in the 800 person sample, based on the four administrative regions used by TWCC.

Three hundred and twenty-five doctors responded to the survey for a total response rate of 40.8 percent. Of those:

  • 51.3 percent were orthopedists (including orthopedic surgeons);
  • 13.2 percent were neurologists;
  • 12.9 percent were in family or general practice;
  • 9.5 percent practiced in physical medicine and rehabilitation or sports medicine;
  • 8.3 percent were in occupational or industrial medicine;
  • 8 percent practiced in other fields, including hand specialists, pain management doctors, and plastic surgeons.

The vast majority (92.6 percent) of the doctors identified themselves as treating doctors, 6.2 percent of the doctors reported they were insurance doctors, and 17.8 percent listed themselves as designated doctors (a cross-check against TWCC’s designated doctor list revealed that the percentage of survey respondents who were certified as designated doctors was actually 28.3 percent). Key findings of the survey follow.

Administrative Issues

Paperwork.

There are fourteen medical forms supplied by TWCC to doctors (compared to eight forms specifically for employers, eight for insurance carriers, and nine for employees). In addition, a doctor’s office must also process forms required by insurance companies. To understand how paperwork in the WC system affects a doctor’s practice, we asked respondents their opinion about the administrative duties required of them.

Half of the respondents (50.8 percent) felt that the amount of paperwork required was onerous; a little over a third (36 percent) felt that it was heavy but necessary. Only 8.3 percent did not feel the amount of paperwork was a problem.

The most common suggestion, named by 20.8 percent of the respondents, was that the forms and/or reports sent to TWCC either be simplified, streamlined, decreased or eliminated. An alternative listed by 6.7 percent was that doctors’ charts or narratives be accepted in place of the TWCC forms. The third most popular response was that TWCC establish a computer or electronic filing system for claims (5.2 percent).

Preauthorization Requirements

Although it adds an administrative layer to the treatment process, the majority of doctors (52.9 percent) felt that preauthorization requirements are necessary. This represents a significant though not overwhelming — lead over the 42.5 percent who felt that the requirements are unnecessary.

The main reason given for supporting preauthorizations is that “Screening/proper checks and balances are necessary to check overuse, abuse, and duplication” (given by 19.4 percent of respondents). Of those who felt preauthorizations are unnecessary, the main reason was that the “treating doctor should be able to decide proper treatment and/or decisions should not be made by people with no knowledge of the case or who never saw the patient” (17.9 percent). A close secondary reason against preauthorizations was that they “cause delays and confrontations, adversely affecting patient’s health” (16.3 percent). (See Figure 3.)    

A sizable number of respondents (13.2 percent) felt that preauthorizations were necessary in certain situations but not in others that currently require it. Generally the distinction was made between exceptional and expensive procedures or surgery (which they felt should require preauthorization) and procedures involving testing, diagnostics, physical therapy, follow-up x-rays , or obvious medical necessity (which they felt should be exempt).

Return to Work

The overwhelming majority of doctors surveyed (81.5 percent) replied that they did work directly with employers in helping injured workers return to work; 16.9 percent replied that they did not.

When asked specifically how they facilitated return to work, the number one answer was “Suggest light duty or modified work conditions to employers.” Closely related to this answer but more general was the second most frequent response, “Discuss case with employer and/or liaison nurse, case manager, etc.”

The fact that recommending light duty was the top technique given suggests that most doctors involved in the WC system are aware of the importance of timely return to work.

Disputes

Two-thirds of the doctors surveyed (66.8 percent) had been involved in the TWCC medical dispute resolution process. The most frequent types of disputes indicated were those involving medical necessity/utilization review (44.0 percent) and preauthorization (42.5 percent). Disputes concerning second opinion on spinal surgery were listed by 36.3 percent of the respondents, followed by fee disputes (24.9 percent). All other types of disputes (e.g., impairment ratings and maximum medical improvement issues) were named by 8.9 percent.

When asked to rate the fairness of the medical dispute process, most felt it was more often fair than not. On a five-point scale, the most frequent response (25.2 percent) was right in the middle (“moderately fair”), followed by “fair” (23.1 percent) then “unfair” (13.5 percent).

The primary complaint —named by 17.2 percent of the doctors — was that the dispute process took too long, adversely affecting patient care and making it not worth the effort financially.

A second issue — listed by 13.2 percent of respondents — concerned the doctor’s role in workers’ compensation cases. There were two separate but related components to this issue:

  1. Evaluate the review/decision process (7.7 percent). Respondents were concerned that disputes were being resolved by nurses and nonmedical “middlemen”; by doctors of different specialty than the treating doctor; by anonymous doctors; and by doctors not licensed to practice in Texas. Many felt that the current review process favored insurance companies to the detriment of injured workers.
  2. Doctors should have decision-making authority (5.5 percent). Respondents felt that disputes would be minimized if doctors were free to decide proper treatment with little or no interference.

The third most frequent suggestion regarding the dispute process was to evaluate the role of insurance companies (5.2 percent). Respondents felt that insurance carriers — because of their lawyers — have an unfair advantage in the dispute resolution process. They also felt that carriers were not held liable for their actions and should be monitored more closely.

Impairment Ratings

To calculate the impairment ratings, the doctor is statutorily required to use the American Medical Association’s Guides to the Evaluation of Permanent Impairment, 3rd edition, 2nd printing (Guides), which was published in 1989. The doctors first were asked if the Guides provide accurate impairment ratings. The results were fairly split: 32.9 percent said that the Guides do provide accurate impairment ratings; 29.5 percent do not believe the Guides provide accurate impairment ratings; and 32.0 percent believe that accurate impairment ratings are provided only some of the time.

A clear majority agreed that a newer edition should be adopted (62.5 percent) as opposed to those who wanted to maintain use of the current edition (25.5 percent).

The mean of all the scores was calculated which indicated that overall most doctors believe the Guides are moderate to somewhat difficult to use.

When asked to explain their rating choices:

  • 21.8 percent stated that the Guides are easy to use and interpret, particularly when doctors are experienced with performing impairment ratings or if they have taken courses on how to interpret the Guides;
  • 12.3 percent said that the evaluations took a long time to do and were complicated; and
  • 11.1 percent said that the Guides are not well organized and poorly indexed.

Managed Care

A large percentage of doctors (84.6 percent) said that managed care organizations should not be utilized in WC, as opposed to the 5.5 percent who were in favor of managed care.

Doctors listed many disadvantages to managed care in WC:

  • Limits or delays treatment and/or lowers the standard of care (32.6 percent);
  • Increases administrative demands/costs, paperwork, bureaucracy, hassle (23.7 percent);
  • Lowers fees/reimbursement, poor control of payment (16.9 percent); and
  • Profit goal rather than patient’s interest (15.7 percent).

Top Health Care Issues for Workers’ Compensation

Doctors were asked to name the most important issues facing health care providers in terms of the WC system (See Figure 4, Top Health Care Issues for Workers' Compensation).    Responses included:

  • Reduction of fees/late payments (27.4 percent);
  • Increasing paperwork/bureaucracy/administrative costs (24 percent);
  • Timeliness (Administrative delays by insurance carriers, TWCC, employers) (16.6 percent);
  • Insurance Carriers—have unfair advantage; need to be monitored/held liable; routinely audit all bills; general “hassle factor” (15.5 percent);
  • Unnecessary, ineffective middlemen /nonmedical intermediaries; unqualified/different specialty doctors giving second opinion, impairment ratings; Doctors should be allowed to handle cases with minimal interference (14.1 percent); and
  • System too complex (impairment ratings, preauthorizations, second opinions) (13.2 percent).

It should be noted that “system complexity” may be related to concern about “paperwork/ bureaucracy/administrative costs.” If those two responses are combined, concern about the burden of a complex bureaucracy would be the top issue by a significant margin.

Of note is the relative low concern over fraud issues, despite the high profile given WC fraud in the press. It is also surprising to see managed care so low on the list, though one could view such issues as reduced fees, increased paperwork, nonmedical intermediaries, and preauthorization complexities as managed care issues.

This article is based upon a report, Survey of Texas Doctors Who Participate in the Workers' Compensation System. If you would like to order a full copy of this report, please return to our publication form.


Footnotes:

  1.    These percentages exclude 11 percent of the injured workers who indicated that they were currently not working, but their unemployment was due to reasons other than their injury.
  2.    These findings regarding back injuries are consistent with previous research. See Research and Oversight Council on Workers' Compensation, Severely Injured Workers: Supplemental Income Benefits in the Texas Workers' Compensation System, 1996, and the Texas Monitor, "Duration of Temporary Income Benefit Payments Drops Substantially Over 1991 to 1993 Period" (Summer 1996).
  3.    The requesting party was the party making the first request for a benefit review conference in which impairment rating was listed as an issue. The term "employee" also includes requests from the employee's attorney.
  4.    An injured worker's entitlement to IIBs begins on the day after the date the injured worker reaches maximum medical improvement and ends on the earlier date of: 1) expiration of a period computed at the rate of three weeks for each percentage point of impairment; or 2) the date of the employee's death (Section 408.121, Texas Labor Code).
  5.    If an injured workers' impairment rating and/or certification of maximum medical improvement is disputed, the TWCC directs the injured worker to be examined by a designated doctor chosen by a mutual agreement between the injured worker and the insurance company in order to resolve the dispute. If the injured worker and the insurance company are unable to agree on a designated doctor, the TWCC will appoint a designated doctor to perform the exam (Section 408.122, Texas Labor Code).
  6.    Impairment ratings prior to an established date of maximum medical improvement or with doctor type missing are excluded from Tables 4-6. Cases with an impairment rating above 80 percent are excluded from Table 5 and Table 6.
  7.    An impairment rating is the percentage of permanent impairment of the whole body resulting from a work-related injury.


   

SURVEY OF PERMANENTLY IMPAIRED WORKERS

The research reported here arose out of policymakers' concerns about how well the Texas workers' compensation system meets the needs of permanently impaired workers. In particular, three questions were posed:

  1. How many injured workers are unable to return to work because of the lasting effects of their injury, but are not eligible for continued income benefits? In other words, how many workers are "falling through the cracks"?
  2. Are there inconsistencies in the way that impairment ratings are given to injured workers?
  3. What are the reasons for impairment rating disputes?

Information in this report came from the following sources:

  • A project data set containing information on 10,435 claims from the Texas Workers' Compensation Commission's (TWCC) research database.
  • Survey data compiled from telephone interviews with 788 injured workers from the same population.
  • Case studies of 196 files on impairment rating disputes from the same population to determine the specific reasons for the dispute.

The project focused on claims with injury dates in 1993 and permanent impairment ratings of 8 to 14 percent. This range of impairment was chosen because it represents workers who have suffered a serious injury, yet fall below the cutoff for supplemental income benefits (SIBs, which are available for impairment ratings of 15 percent or higher). The 1993 injury year was chosen because claims from that year are no longer eligible to receive income benefits.


This page was last updated on December 9, 2002.


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