TEXAS MONITOR, 4:3 (Fall 1999)
- Results of 1999 ROC Customer Satisfaction Survey
- ROC Welcomes Two New Board Members
- Impairment Rating Trends in the Texas Workers' Compensation System
- An Examination of Medical Dispute Resolution
- A Clinical Review and Comparison of Texas Medical Treatment Guidelines
- ROC Issues Request for Information to Study Workers' Compensation Medical Costs and Quality
In the Spring of 1999, following a review from the Office of the State Auditor, the Research and Oversight Council on Workers' Compensation (ROC) contracted with the University of North Texas Survey Research Center (UNT) to conduct a mail survey of the ROC's customers. Similar surveys had been recommended for other regulatory agencies by the Governor's Office. The goal of the ROC survey was to assist t he agency in identifying service strengths and weaknesses and improving customer relations. The survey addressed four areas:
- ROC research publications (including the Texas Monitor and research reports);
- the ROC website;
- ROC information requests/customer assistance; and
- general agency performance. 1
Texas Monitor. The Texas Monitor is a quarterly newsletter published by the ROC that reports on the status of the workers' compensation system, chiefly through summaries of its research studies. 2 Most survey respondents (74.8 percent) indicated they have read at least one issue of the Texas Monitor during the past year. Almost half of the respondents (48.7 percent) have read four or more issues during the past year.
First, respondents were asked to rate the usefulness of the Texas Monitor compared to other workers' compensation publications: over three-quarters reported that the Texas Monitor was "very useful" or "useful" (80.1 percent). Readers of the Texas Monitor were also asked to assess the readability of this newsletter: 74.2 percent believed it was "very easy" or "easy" to understand.
Survey respondents were given the opportunity to suggest additional topics for the Texas Monitor. Readers were most interested in the following areas of the workers' compensation system:
- workers' compensation legislation (17.7 percent);
- "hot" issues in the workers' compensation system (16.5 percent);
- rules and regulations (13.2 percent);
- legal issues (13.0 percent); and
- other (39.5 percent). 3
Research Reports. The ROC publishes research and policy reports on a variety of subjects each year. Half of the respondents (50 percent) have read at least one report produced by the ROC during the previous year.
Overall, customers were satisfied with the ROC reports they had read. To summarize:
- many readers found ROC reports to be "very easy" or "easy" to read (72.7 percent);
- most readers found the reports "very useful" or "useful" (80.4 percent); and
- the issues examined were "very relevant" or "relevant" to the workers' compensation system (80.9 percent).
Since 1996, the ROC has maintained an Internet website that provides interested parties with information about the ROC and its services. 4 The website contains a variety of material including the executive summaries of reports, full text editions of the Texas Monitor, links to other states' workers' compensation agencies, and a form for ordering all items on the ROC publication list.
In general, less than one-quarter of the total respondents reported visiting the ROC's website (23.4 percent). Of those, the majority found the website "very easy" or "easy" to use (74.2 percent), and considered the information to be "very useful" or "useful" (74.1 percent). The following suggestions were offered for additional materials that could be added to the website:
- full text of ROC reports;
- pending legislation/legislative and regulatory changes;
- key statistical indicators;
- current topics;
- formatting suggestions ; and
- other specific suggestions. 5
Information Requests and Customer Assistance
The ROC staff assists legislators, the general public, and individuals from other workers' compensation systems in obtaining statistical and general information on the Texas system. The ROC may also assist injured workers, employers, insurance carriers, health care providers and others on a specific issue. Over one-third (39.6 percent) of the survey respondents said they have contacted the ROC for information or assistance in the past six months.
Respondents commented on basic customer service areas of promptness, courteousness, knowledge of staff, and the value of the information provided. The ROC staff scored highest marks for courtesy - 88.0 percent identified the staff as either "very courteous" or "courteous" in answering questions. Most survey respondents stated that ROC staff was also "very prompt" or "prompt" in answering questions (80.5 percent). In addition, over three-quarters (78.0 percent) responded that staff was "very knowledgeable" or "knowledgeable" in answering their questions. Finally, most individuals (73.0 percent) stated that the information provided was either "very useful" or "useful" in answering their questions. Overall, three-quarters of the individuals (75.2 percent) stated they are either "very satisfied" or "satisfied" with the assistance received.
General Agency Performance
The mission of the ROC is:
- "To conduct factual, unbiased research and professional studies; monitor the agencies and entities involved in the workers' compensation system; develop sound policy recommendations regarding regulatory and/or legislative changes; provide information on workers' compensation to the general public; and respond to constituents' needs for assistance." 6
To gauge how well the ROC fulfills its mission, customers were asked to comment on three areas: the soundness of the agency's policy recommendations, the agency's knowledge of the workers' compensation system, and the degree to which the agency is an impartial entity. Overall, a clear majority of respondents concluded that the ROC was meeting the goals expressed in its mission statement.
First, survey respondents were asked how strongly they agreed or disagreed with the statement that the ROC develops sound policy recommendations. Almost half (47.5 percent) either "strongly agreed" or "agreed" with this statement, and 40.1 percent were neutral (see Figure 1).
Second, ROC customers were asked how strongly they agreed or disagreed with the statement that the ROC is knowledgeable about key issues affecting the workers' compensation system. The ROC received its highest scores in this area: 70.4 percent "strongly agreed" or "agreed" that the ROC is knowledgeable about important issues, and 23.3 percent were "neutral" (see Figure 2).
The respondents also indicated how strongly they agreed or disagreed with the statement that the ROC is an impartial entity in assessing the effectiveness of the workers' compensation system; 45.3 percent "strongly agreed" or "agreed" that the ROC is impartial, and 39.3 percent were "neutral" (see Figure 3 ).
Of the three mission-related areas examined, ROC customers were most positive about the agency's knowledge of the system. Although positive responses outweighed negative in all three areas, customers were relatively less positive about the soundness of the ROC's policy recommendations and degree of impartiality.
To gain more insight into these key issues, the ROC conducted a follow-up telephone survey of the 65 respondents who rated the ROC low in at least one of the mission statement areas. The interviewer was able to contact 14 of these individuals for follow-up interviews. Interestingly, when asked the same set of questions over the telephone, the answers were not always consistent with those given in the mail survey. The mixed nature of the results of the follow-up telephone survey may indicate that the agency's performance in these areas is higher than that suggested in the mail survey. However, due to the low number of respondents involved in the follow-up, it is difficult to draw firm conclusions.
The first ROC customer survey indicates that in most areas, the agency is meeting its mandated mission to assess the effectiveness of the workers' compensation system and make recommendations for improvements. In measures related to publications, agency website, information requests, and customer assistance, a strong majority of customers (in the 70-80 percent range) rate the ROC positively. While these results indicate overall positive performance, there is room for improvement.
When asked directly about mission-critical areas, ROC customers were somewhat less positive (relative to other positive responses) about the agency's impartiality and the soundness of its policy recommendations. The issues of bias and quality of policy recommendations will be key focus areas for future ROC customer service surveys.
Customer Service Initiatives Underway
The ROC has already begun to implement a number of procedures designed to enhance its service to customers. Among th e issues recently addressed are:
Customer Interest in Legislative Issues. In 1999, the ROC expanded its coverage of legislative issues by publishing a Texas Monitor article during session as well as a special post-session wrap-up edition during the summer. 7 The special edition included detailed summaries of all workers' compensation-related bills that passed and were signed into law. It also provided a description of interim research projects mandated through legislation that will address key system issues prior to the next session.
Quality of Published Materials. Because the bulk of the ROC's work is geared toward publication (both in print and on the Internet), the agency has reorganized its editing process to provide for greater scrutiny and more stringent review prior to dissemination. The new procedures include both internal process improvements as well as opportunities for external review from key system participants. These changes are designed to increase the accuracy, usefulness, and relevance of ROC-produced materials.
Effectiveness of Customer and Agency Communication. Recent agency reorganization has resulted in the creation of a public information function at the ROC, designed to increase the effectiveness and efficiency of information dissemination to ROC customers. The ROC is currently developing an information strategy to maximize the agency's effectiveness in meeting the needs of customers, from individual requests for specific information to broad-based dissemination of key research findings and policy analyses.
Usefulness of Website. The dynamic nature of Internet media has allowed the ROC to continually update and enhance its website with new information and new services. Based on suggestions received prior to the customer satisfaction survey, the ROC is exploring the cost factors involved with increasing the electronic storage space necessary to accommodate full text versions of all ROC publications online.
Based upon the results of its first customer service survey, the ROC will develop an action plan to improve service in key areas and address concerns about some of the qualitative aspects of the agency's performance.
During the course of this survey project, Senate Bill 1563 was passed by the 76th Legislature, requiring all state agencies to conduct a customer service satisfaction survey annually. We will be incorporating the additional information mandated by SB 1563 into our next survey, scheduled to take place in the Spring and Summer of 2000.
The ROC's first customer satisfaction survey has served as a useful management tool to help the agency address qualitative aspects of its performance and better fulfill customer needs. We appreciate the guidance from the Governor's Office and State Auditor's Office for providing the impetus for the survey.
The results of this survey have provided the ROC with tangible goals to achieve. During the next year, ROC staff will implement plans to help the agency achieve higher degrees of satisfaction and address concerns expressed by some respondents in key mission-related areas.
The Research and Oversight Council on Workers' Compensation welcomes two additions to its board: Representative Scott Hochberg and Senator Troy Fraser. Both served as sponsors of workers' compensation legislation in the recent 76th Legislative Session. Representative Hochberg filled a vacancy on the board while Senator Fraser takes the place of Senator Bill Ratliff. We appreciate the many contributions made by Senator Ratliff to the work of the ROC over the last few years.
We welcome our new board members and look forward to their input and guidance.
This article is excerpted from Impairment Rating Trends in the Texas Workers' Compensation System (August 1999), available from the ROC upon request or through our publication form.
One of the key changes affected by the 1989 workers' compensation reform in Texas was the way that benefits are determined for a worker who sustains a permanent partial disability. Under the new law, these benefits are known as Impairment Income Benefits (IIBs) and are based on: 1) the injured worker's degree of physical impairment, using the American Medical Association's Guides to the Evaluation of Permanent Impairment (third edition, second printing, 1989) (AMA Guides); and 2) the worker's pre-injury weekly wage. The degree of physical impairment is expressed as an "impairment rating," which is determined by a health care provider. 8
Although most permanently impaired workers receive only one impairment rating during the course of their claim, multiple ratings can occur if the initial rating is disputed or if there is disagreement over other claim issues (e.g., whether the worker has reached Maximum Medical Improvement). 9 Differences in impairment ratings for the same injury can affect the amount of income benefits the injured worker receives, and/or whether the worker is eligible for other income benefits (i.e., Supplemental Income Benefits, which may be available to workers with a 15 percent impairment rating or higher). Besides the cost issues involved in these determinations, multiple impairment ratings generate additional administrative costs to the workers' compensation system as a whole.
This article summarizes an examination of the Texas impairment rating process to assess the prevalence of multiple impairment ratings for the same injury, disparities in multiple impairment ratings, and the length of time between the first and last rating given to injured workers.
The study population for this analysis consisted of 807,537 injured workers with impairment ratings, taken from the research database maintained by the Texas Workers' Compensation Commission (TWCC). The workers in this population sustained injuries between 1991 and 1998. Information on the type of doctor assigning an impairment rating has been collected by TWCC only since July 1, 1994; consequently, the portion of this article concerning doctor types is limited to 320,384 injured workers with impairment ratings established from July 1, 1994 to January 1, 1997 (to allow sufficient time for these claims to reach the statutory 104-week limit for maximum medical improvement).
Overall, the majority of injured workers in the study population for this report (80.5 percent) received only one impairment rating during the course of their injury. Not surprisingly, however, injured workers receiving income benefits were more likely to have undergone several impairment rating examinations than injured workers who received only medical treatment.
The data also show that the proportion of injured workers with multiple impairment ratings is on the decline, from almost 19 percent of all claims with impairment ratings in 1994 to 11 percent in 1998 (see Figure 4).
Average Difference Between First and Last Impairment Ratings
The average difference between the first and last impairment rating assigned to an injured worker was calculated for claims with multiple impairment ratings to examine how these ratings may differ for the same injury.
Overall, almost a quarter of claims in the study population (24 percent)with multiple impairment ratings for the same injury had no difference between the first and last impairment rating; a third (33 percent) had a 1 to 4 percentage point difference; almost a third (29 percent) had a 5 to 10 percentage point difference; and 14 percent had greater than a 10 percentage point difference between the first and last impairment rating assigned (see Table 1).
The order in which doctors assign impairment ratings appears to play an important role in determining the amount of difference between the first and last impairment rating. The largest differences occur when the insurance doctor is the first doctor to assign an impairment rating to the injured worker. Interestingly, when the treating doctor is the first to assign an impairment rating, differences in impairment ratings decrease significantly.
There are several possible explanations for the differences in impairment rating by doctor type, including experience level, familiarity with the AMA Guides, differing financial incentives, and honest differences of medical opinion.
It is also important to remember that while discrepancies do occur when the insurance doctor assigns the first impairment rating, insurance carrier involvement is infrequent in the assignment of the first and last impairment rating relative to other doctor types in the Texas system.
Generally, treating and designated doctors tend to assign similar impairment ratings for the same injury, and tend to assign higher impairment ratings on average than insurance doctors. Treating doctors rate the same injury on average nearly 7 percentage points higher than insurance doctors, while designated doctors tend to rate the same injury roughly 5 percentage points higher on average than insurance doctors (see Figure 5). These differences are significant, considering that each percentage point represents three weeks of IIBs for the injured worker.
The least difference between first and last impairment ratings occurred in cases where the treating doctor assigned the first rating and an "other" doctor assigned the last. The greatest difference occurred when the insurance doctor assigned the first rating and the designated doctor assigned the last.
It is important to understand the length of time between impairment ratings because it represents possible financial uncertainty for the injured worker, whose income benefits could be withheld pending resolution of an impairment rating or MMI dispute. There are also additional administrative expenses associated with scheduling examinations and/or resolving disputes. On average, in cases with multiple impairment ratings, it takes 177 days (roughly six months) from the date of the first impairment rating examination to the last. 10 There may be an additional impact on the timeframe if there is a dispute over whether an injury is work-related (i.e., compensable), or concerns regarding the extent of the work-related injury, since these kinds of disputes must first be resolved before any dispute over the worker's impairment rating or MMI status can be considered.
As expected, the length of time from the first to the last impairment rating is largely determined by the number of impairment ratings received by the injured worker. Even with just two impairment ratings, however, the average time from first to last impairment rating is still 137 days (roughly four months).
Again, doctor type plays an important role in determining the length of time in the impairment rating process. When the insurance doctor is the first doctor to assign an impairment rating, the average length of time increases from 177 to 191 days. This added time may reflect the complexity of a claim in which an insurance doctor would assign the first impairment rating, or it may be indicative of a question regarding the MMI status of the worker.
Most injured workers in the study population (80.5 percent) received only one impairment rating, and the prevalence of claims with multiple impairment ratings has declined over time. However, in cases involving multiple impairment ratings for the same injury, a high percentage (43 percent) show disparities of 5 percent or greater between doctors. Injured workers, who may experience financial difficulty as a result of an injury, may be especially affected since each percentage point of an impairment rating equates to three weeks of IIBs.
Possible areas of improvement to consider include:
- Increase Impairment Rating Quality. Currently, only doctors who assign an impairment rating as a designated doctor are required to receive training. Increasing the number of doctors who are trained - by including treating and insurance doctors who assign impairment ratings - may result in more accurate ratings and therefore fewer disputes.
It may be useful to consider implementing quality reviews of impairment ratings given by doctors to ensure that the examining doctor properly applied the AMA Guides, considered all relevant injuries, reviewed all necessary patient records, and documented all impairment calculations.
Finally, it may be helpful to assess the quality of the training itself, as well as the process by which doctors are selected to serve as a designated doctor.
- Improve Communication Between Participants. Lack of communication between the injured worker, his or her doctor, and the insurance company is a potential sour ce of friction during the impairment rating process. If the insurance company feels that it needs additional information regarding the medical status of an injured worker, it may feel compelled to request an examination when better communication might have sufficed.
- Encourage Insurance Carriers to Proceed Directly to a Designated Doctor Exam. To reduce the number of cases that have multiple impairment ratings assigned by treating, insurance, and designated doctors, carriers should try to identify these types of cases early-on and request a designated doctor exam immediately if there is an impairment rating or MMI dispute. Although increasing the number of designated doctor exams is costly and may increase TWCC's administrative burden, this change may reduce the number and cost of unnecessary additional impairment rating examinations and as a result, lower overall costs.
- Consider Reducing Examination Timeframes. In order to reduce the length of time between the first impairment rating and the last, it may be necessary to re-examine the current timeframes for scheduling impairment rating examinations and filing required reports. Reducing these timeframes would help injured workers receive their IIBs in a more timely manner.
- Improve Data Collection. Unnecessary form filings result in increased system and administrative costs. However, it is not known how often duplicate TWCC-69 forms ("Report of Medical Evaluation") are submitted to the TWCC after the final impairment rating is calculated. Additionally, the existing data collection does not identify which impairment rating was determined to be the "final" rating for the worker. Efforts should be made to improve data collection to reduce the extraneous filing of forms and record which impairment rating is final.
This article is excerpted from An Examination of the Medical Dispute Resolution Process in Texas (August 1999), available from the ROC upon request or through our publication form.
The timely resolution of medical disputes is an important factor in the delivery of quality and cost-effective medical treatment. This article explores recent trends in the Texas medical dispute resolution system.
The Medical Dispute Resolution Process at TWCC
The medical dispute resolution process is a multi-tiered administrative system designed to minimize costly, time-consuming litigation between health care providers, insurance carriers, and injured workers.
Most workers' compensation medical disputes fall into three general categories:
- Pre-authorization dispute - may arise when an insurance carrier denies a health care provider's request for pre-authorization of certain treatments. The Pre-authorization Rule, which covers 16 groups of treatments, tests, and services, was designed as a cost-containment mechanism to minimize unnecessary treatments. 11 Since a pre-authorization dispute actually delays medical treatment pending the outcome of the dispute, it receives priority over fee and medical necessity disputes.
- General Fee dispute - may arise when:
- a carrier denies or reduces a health care provider's fees; or
- a service requiring pre-authorization is conducted without an approval; or
- a disagreement arises over a carrier's determination of whether the cost of a medical treatment already performed is "fair and reasonable."
- Medical Necessity dispute - may arise when a carrier denies payment on the grounds that the treatment, test, or service was not medically necessary.
A request for medical dispute resolution is submitted to the Medical Review Division of the Texas Workers' Compensation Commission (TWCC) through a request form (TWCC-60) or an informational letter. 12 Among the documentation required is proof of efforts between the parties to resolve the dispute.
The party responding to the dispute (typically the insurance carrier) has 30 days to file a response with TWCC or risks losing the dispute. The response is expected to include a statement of the respondent's position regarding the dispute, along with appropriate medical summaries and peer review reports. Once all required documentation is received, Medical Review staff review the dispute and issue a "Findings and Decision" to the disputing parties.
Fee and medical necessity disputes, which involve treatments already provided and billing issues, must be filed within a minimum (60-day) and maximum (one year) timeframe from date of service. Because pre-authorization involves prospective treatment, a dispute can be filed immediately.
To appeal a decision, a request for a formal hearing must be filed with TWCC by the 20th working day after the decision is issued. Appeals are conducted in formal hearings by the State Office of Administrative Hearings (SOAH). 13 SOAH decisions may be appealed to district court by either party .
In order to minimize the number of formal appeals, TWCC has implemented an administrative process called the Informal Resolution Conference (IRC), through which medical disputes can be resolved without a SOAH hearing. The IRC is a voluntary process that allows for confidential mediation by phone or in person. The IRC process requires the disputing parties to exchange all relevant documentation as well as written proposals for resolving the dispute no later than seven days prior to the IRC hearing day. Mediators at TWCC serve as facilitators for the disputing parties. If a dispute remains unresolved after an IRC, it may proceed to a SOAH hearing.
Some indicators suggest that the medical dispute resolution system has had significant success since its inception in 1991. For example, in each year from 1995 to 1998, less than 1 percent of all medical bills processed in the system resulted in the filing of a medical dispute. 14 In addition, a great majority (over 80 percent) of the disputes entering the administrative medical dispute resolution process are resolved without utilizing the formal appeals system (SOAH). Also, the average timeframe for processing medical disputes administratively has seen a steady decline, especially from 1994 to 1997 (see Figure 6. However, the total number of disputes considered is on the rise again: as of June 1999, TWCC has already completed 2,061 medical disputes. 15
Interestingly, during the years showing the most dramatic progress in reducing the duration of dispute resolution, the number of medical disputes processed by TWCC rose significantly (see Figure 6). While the weighted-average number of days for the three dispute types fell from 207 days in 1993 to 126 days in 1995 (a decrease of 40 percent), the total number of medical disputes processed by TWCC almost tripled from 1,222 in 1993 to 3,593 in 1995. 16
Overall, the average number of days to process a medical dispute fell for five out of the six years shown, while the total number of disputes increased four out of those six years. The simple linear trend lines in Figure 1 point to more medical disputes and shorter dispute timeframes into the year 2000.
While the number of disputes processed may be driven by the number of disputes received, process efficiency and staff expertise may be stronger factors in explaining how an increasing number of cases are being closed in shorter timeframes. This could also be indicative of an inverse relationship between the timeframes to dispute resolution and the number of medical disputes. If the timeframes to dispute resolution are considered by the disputing parties to be barriers to entering the process, then as the timeframes fall, more disputes could follow. Further research would be required to test the strength of this relationship between dispute resolution timeframes and the number of disputes.
SOAH Appeals Timeframes
Appeals from TWCC to SOAH for pre-authorization disputes took 111 days on average in 1997. 17 In contrast, the average timeframe for processing a pre-authorization dispute by TWCC's Medical Review Division was 41 days. Injured workers whose pre-authorization disputes were appealed to SOAH in 1997 therefore waited a total of 152 days (about five months) on average before a treatment approval could be obtained.
After an overall 15 percent drop from 1996 to 1997, all three dispute-types are on the increase. 18 Pre-authorization disputes show the most significant increase, growing by 150 percent from 1997 to 1998 (see Figure 7). The 1999 total for pre-authorization disputes may well exceed the 1998 level of 1,351, since the mid-year total is already 764 disputes. However, the average number of days to process pre-authorization disputes has stabilized since 1997.
Although the duration of medical necessity disputes has also stabilized since 1997, the duration for fee disputes increased in 1998. Longer timeframes for fee disputes may be the result of:
- a higher number of medical fee disputes as compared to the pre-1995 years;
- the influx of over 25,000 hospital fee disputes since 1997, due to the repeal of TWCC's Acute Care Inpatient Hospital Fee Guideline; 19 and/or
- inadequate staffing or inefficient methods to process the increase in disputes received.
The total dollars disputed for medical necessity and fee disputes grew by 33 percent from $1.5 million in 1997 to $2 million in 1998. 20 Since the total for the first six months of 1999 is already 75 percent of the 1998 amount, this year's total may well exceed $3 million, twice the total amount disputed in 1997. The average disputed amount for fee and medical necessity disputes is rising moderately, from $2,066 per dispute in 1997 to $2,224 for 1999.
Denials and Reductions of Medical Bills
General fee and medical necessity disputes arise from disagreements over compensation for medical bills submitted by health care providers. Providers bill insurance carriers for payment after treatments are rendered. Upon receiving a medical bill, the carrier reviews the bill to determine the appropriateness of the medical treatment and the charge. The carrier either pays, reduces, or denies payment of the bill. This process is referred to as "retrospective review." The justifications for reductions and denials are reported using codes required by TWCC to describe the rationale for the decision. Figure 8 shows the relative distribution of initial reimbursement denials and reductions based on denial codes.
The three codes used most frequently by insurance carriers to deny or reduce bills total 2.6 million, or about 70 percent of all denials and reductions during the past three years. Denials/reductions for "inadequate documentation" comprised 32 percent of the total, followed by "pre-authorization not obtained" at 19 percent and "fair and reasonable" reductions at 16 percent.
Denials and Reductions: Frequencies and Dollar Amounts
While less than 1 percent of all medical bill denials and reductions resulted in disputes filed with TWCC in 1996, the disputed dollar amount was 3.4 percent of the total denied/reduced dollar amounts for that year. It is reasonable to conclude that as much as 96.6 percent of the initial dollar amount denied or reduced by insurance carriers goes unchallenged because the provider fails to request TWCC medical dispute resolution. In the past three years, over $200 million in medical charges were either reduced or denied on initial bill submissions without a medical dispute at TWCC. 21
Statewide, the initial denial or reduction rate by insurance carriers for all Texas workers' compensation medical bills averaged 14.3 percent in 1997 and 15.9 percent in 1998. 22 However, system participants estimate that perhaps up to 30 percent of initially denied bills are routinely resubmitted by health care providers. In some cases, insurance carriers reconsider and pay previously denied bills if resubmitted with a written appeal and adequate documentation.
Data are unavailable to accurately assess the degree to which health care providers challenge payment denials/reductions with written appeals to the carrier outside of the TWCC process, or the degree to which they are satisfactorily resolved.
The medical dispute resolution process at TWCC was established as an informal resolution system to reduce costly litigation and to help ensure effective and efficient delivery of medical treatment to injured workers. Some indicators suggest that TWCC's Medical Review Division has had exceptional success in preventing and processing medical disputes: less than 8 out of every 10,000 treatments (less than 1 percent) end up in the medical dispute resolution system, and the dispute timeframes have been reduced significantly since 1993.
However, improvement may still be warranted. Previous studies have shown that most providers believe that the dispute process is cost-prohibitive, and as a result, write-off most reduced and unpaid bills. 23 More than 96 percent of all denials/reductions go undisputed. Additionally, insurance carriers believe the process is too long and imposes a costly administrative burden. All indications are that the result of shorter dispute timeframes would be an increase in the number of disputes TWCC must consider.
The challenge for TWCC is to continue to make progress toward an even more efficient dispute resolution timeframe while monitoring the need for additional resources to handle an increasing workload resulting from increased provider utilization. To be sustainable, improvements in the dispute resolution process should be accompanied by efforts to minimize the bill denials and reductions at the outset that lead to medical disputes.
This article is excerpted from Workers' Compensation Medical Treatment Guidelines in Texas</ a> (August 1999), available from the ROC upon request or through our publication form.
This article is Part 3 in a series examining the Texas medical treatment guidelines. Previous articles looked at usage figures (Texas Monitor 4(1), Spring 1999 and compared the Texas guidelines with guidelines from other states (Texas Monitor 4(2), Summer 1999). In this concluding article, we present findings from a clinical review of Texas medical treatment guidelines along with selected guidelines from other states.
As noted in previous findings, a large percentage of health care providers actively involved in the Texas workers' compensation system either do not have or do not use the TWCC medical treatment guidelines in their treatment of work-related injuries (see Texas Monitor 4:1, Spring 1999). While this finding indicates a lack of information provided to (or sought by) health care providers in the system, some health care providers who did have copies of the guidelines reported that they do not typically use them because they believe that "medical treatment [should be] based upon clinical findings and responses of the individual injured worker" and that the TWCC guidelines are too "complicated," "take too much time," and are "too non-specific at the primary care level of treatment to be of value."
order to better understand how the Texas treatment guidelines compare with those used in other states from a medical perspective, the ROC contracted with six clinical reviewers licensed in Texas (three physicians and three chiropractors) to provide a qualitative assessment of Texas treatment guidelines along with those of other states. 24
Guideline Thoroughness and Ease of Use
It stands to reason that in order for a treatment guideline to be effective, it must contain all t he relevant information needed to evaluate the medical necessity of treatments and at the same time be easy to use. In general, the clinical reviewers for this project rated the Florida Low-Back Practice Guideline the highest in terms of thoroughness and ease of use, followed by the California, Minnesota, Texas and Washington low-back or spine treatment guidelines (ratings were tied for the Texas and Washington guidelines). For carpal tunnel syndrome cases, reviewers rated the Oregon Carpal Tunnel Guideline the highest, followed by Washington, Texas and California's guidelines (see Table 2).
Testing and Treatment Guideline Comparisons
In addition to comparing both the thoroughness and ease of use of the treatment guidelines, the clinical reviewers also examined the proposed tests and treatments included in each of these guidelines, as well as timeframes associated with these proposed tests and treatments.
Excessive Testing and/or Treatment. Overall, most clinical reviewers felt that none of the treatment guidelines reviewed promote excessive testing and/or treatment for work-related injuries. Some reviewers said that since the guidelines provide only "suggestions and not requirements for testing," "excessive testing and treatment is . . . based more on the physician's philosophy and method of treatment."
Two clinical reviewers (one physician and one chiropractor reviewer), however, concluded that both of the Texas treatment guidelines and California's Hand and Wrist Treatment Guideline promote excessive testing and treatment since they group several series of diagnoses together into a specific guideline (i.e., one set of treatment and diagnostic tables for multiple diagnoses). 25 This grouping results in a broader scope of potential tests and treatments that may be considered part of the normal course of treatment for an injury.
Additionally, one reviewer noted that "no specific rationales are listed for any of the diagnostic procedures" in either of the Texas guidelines (with the exception of the Spine Treatment Guideline when spinal surgery is being considered). This reviewer also noted that the Texas guideline "may promote excessive use of conservative care…in the form of unattended modalities, attended modalities 26 and procedures, orthotics and splints, and manipulation" since these treatments are available in all three treatment timeframes (i.e., primary, secondary, and tertiary) and may, as a result, be continuously provided to an injured worker over time.
This same reviewer noted that the Texas Spine Treatment Guideline does not "adequately address the psychosocial aspect of care" because it assumes that these barriers are not present during the primary treatment timeframe (0-8 weeks). These psychosocial barriers (i.e., depression, loss of status as primary wage earner for the household, marital or financial stress, etc.) may prevent an injured worker from responding favorably to treatments and as a result may encourage excessive use of treatments and/or diagnostic testing. 27
Restrictive Testing and/or Treatment. None of the clinical reviewers thought the Texas treatment guidelines were too restrictive or limiting in the use of testing or treatment for work-related injuries.
Four reviewers (one physician and three chiropractors) commented that Washington's Carpal Tunnel Syndrome Treatment Guideline might limit treatment because it is "limited to the wrist only, without regard to the possibility of forearm, shoulder, thoracic outlet or cervical problems." Two reviewers stated that California's Hand and Wrist Treatment Guideline may restrict treatment for carpal tunnel syndrome because it limits the application of "appropriate manual/manipulative therapies, including joint and soft tissue mobilization" to a maximum of 12 treatment visits. One reviewer thought California's Neck and Back Treatment Guideline may limit the use of plain x-rays in the initial stage of treatment for back injuries, and another reviewer thought that Oregon's Carpal Tunnel Treatment Guideline was "less comprehensive in both the treatment and diagnostic areas" than other similar guidelines.
Inappropriate Diagnostic Tests and/or Treatments. When asked if the guidelines reviewed included any diagnostic tests or treatments that may be deemed "inappropriate" for either carpal tunnel syndrome or back injuries, four of the six clinical reviewers replied "no."
One of the remaining two reviewers (a chiropractor) commented that manipulation in the secondary and tertiary treatment timeframes for carpal tunnel syndrome may be inappropriate. The Texas Upper Extremities Treatment Guideline includes manipulation as an acceptable treatment in the primary, secondary, and tertiary treatment timeframes. This reviewer states that the "maximum therapeutic benefit to manipulation is realized in the first month of care" and "after three months, the initial advantage of manipulation over other physical medicine procedures is lost."
The other remaining reviewer (a physician) commented that the organization of the Texas treatment guidelines (by general treatment timeframes for each diagnoses group rather than including an intervention or treatment strategy for each individual diagnosis) may promote excessive care because of the "lack of specificity" in treatment timeframes for each diagnosis. For example, carpal tunnel syndrome is grouped under the larger diagnosis category of "neuropathy." Under this broad category, the reviewer comments, "many more diagnostic and therapeutic interventions have to be offered as possible alternatives thus increasing the possibility of . . . inappropriate care."
In addition, this reviewer mentions areas that may require additional specificity regarding when and how long certain treatments are medically appropriate for specific types of injuries:
- work hardening and work conditioning programs;
- physical therapy (especially "passive modalities" 28);
- chiropractic manipulations for injuries other than spinal injuries and greater than one month from injury;
- repeat nerve blocks;
- "Pain clinic" interventions;
- trigger point injections, acupuncture;
- other pain management therapies; and
- spine surgery, especially multiple surgeries.
Summary of Clinical Review
Although six clinical reviewers ranked both the Texas Spine Treatment Guideline and the Texas Upper Extremities Treatment Guideline lower on average than other similar state treatment guidelines in terms of thoroughness and ease of use, four of the reviewers concluded that none of the state treatment guidelines reviewed (including the Texas guidelines) promoted excessive treatment or testing.
Two reviewers, however, concluded that both Texas guidelines promote excessive testing and treatment since they:
- include one general set of treatment and diagnostic tables for multiple diagnoses; and
- do not list specific rationales for any of the diagnostic procedures.
None of the clinical reviewers felt that the Texas guidelines were too restrictive or limiting in the use of testing or treatment.
Summary of Treatment Guideline Series
To summarize, treatment guidelines can be an effective mechanism to educate system participants about new treatments and positive treatment outcomes; improve consistency in the care provided to injured workers; reduce controversy between health care providers and insurance carriers over what course of treatment is appropriate and cost-effective; and control the utilization of unnecessary medical care (treatment guidelines are widely used among states with lower average medical costs). 29
It is important to note that treatment guidelines should not be created or used to dictate the type and duration of medical care necessary for each individual injured worker. They should, however, be used to represent a normal course of treatment that applies to workers in most cases. In order to be effective, treatment guidelines should be thorough, easy to use, and enforceable.
Treatment guidelines, however, may create more friction in the system than they deter, particularly if they are too broad in scope, lack adequate clinical research documentation, are cumbersome to use, or are not used at all. In addition, treatment guidelines that do not clarify the medical necessity and duration of proposed treatments and tests may further complicate disagreements between health care providers and insurance carriers because they may encourage subjective interpretation and use of the guidelines.
In these cases, the state workers' compensation administrative agency uses vital staff and monetary resources to create and revise the guidelines, while health care providers and insurance carriers use other methods (i.e., their own clinical experience and training; in-house treatment and testing protocols; contracted utilization review agent services; peer reviewers; and ultimately the medical dispute resolution process) to determine the type and duration of medical care necessary for each worker. It is clear that the role of treatment guidelines in the Texas workers' compensation system should continue to be examined if the guidelines are to be effective in reducing medical disputes, controlling costs, and ensuring quality care for injured workers in Texas.
Concern about high medical costs related to workers' compensation claims prompted the 76th Legislature to pass House Bill 3697, directing the Research and Oversight Council on Workers' Compensation (ROC) to conduct comprehensive studies that will examine cost and quality of health care delivered to injured workers in Texas. The ROC will be working with the Texas Workers' Compensation Insurance Fund (Fund) to examine:
- The quality and cost-effectiveness of the current workers' compensation health care delivery system, as compared to other health care delivery systems used in Texas and workers' compensation health care delivery systems used in other states; and
- Medical provider treatment patterns and insurance carrier utilization review practices in the Texas workers' compensation system.
According to a 1999 analysis by the National Council on Compensation Insurance (the nation's largest statistical agent and ratemaking organization for workers' compensation), the average medical cost of a Texas claim for policy year l995 was $4,912, compared to a countrywide average of $2,735. These figures show that Texas claims were roughly 80% higher than the national average. Higher claims costs translate into higher premiums for employers, which in turn may lead some employers to opt out o f the workers' compensation system. Other companies may choose not to operate in Texas costing the state jobs.
On October l, 1999, the ROC published a Request for Information (RFI) to gather information for the medical study. The deadline for submitting a response to the RFI is October 22, l999. The ROC anticipates issuing a Request for Proposal (RFP) for the medical research projects in November l999 and awarding a contract in January 2000. To allow time for the proposals to be considered, the ROC Board will postpone its next meeting until January 2000.
Final completion of the contract(s) and submission of the reports will be on or before October 15, 2000. The RFI is available at the ROC website, medicalrfi.pdf.
Additional information may be obtained on the Internet:
For background information on the ROC, see our website http://www.tdi.texas.gov/wc/regulation/roc/index.html.
For background information on the Fund, see the Fund's website http://www.txfund.com.
For copies of HB 3697, see the Texas Legislature's website http://www.capitol.state.tx.us.
For copies of the Texas Department of Insurance (TDI) Utilization Review Agent (URA) Rules, the Texas Administrative Code can be viewed online at http://www.sos.state.tx.us/tac/index.html. The URA rules are located at Title 28, Chapter 19, Rules 2001-2021.
For general information about the workers' compensation system, see the Texas Workers' Compensation Commission website http://www.tdi.texas.gov.
HB 3697 also instructed the ROC to conduct studies to improve worker safety and to examine return-to-work programs. The ROC expects to publish the Request for Proposal (RFP) for these studies in November 1999.
- The sample consisted of: 1) all recipients of the Texas Monitor; 2) individuals who had requested a publication from the ROC during the previous six months; and 3) individuals who had requested assistance or information from the ROC during the previous six months. Of the original 1300 individuals who were mailed a copy of the survey, 359 responded, and 31 questionnaires were returned as undeliverable. Nine customers were contacted during a follow-up survey for non-response bias, yielding a total response rate of 29.0 percent.
- See Texas Labor Code, Section 404.002 (d) for a complete explanation of the ROC's statutory requirements.
- "Other" includes such items as Frequently Asked Questions (FAQs); national workers' compensation issues; news of workers' compensation agencies; key statistical indicators; workers' compensation fraud; medical treatment issues; return-to-work/vocational rehabilitation issues; research enhancements/analysis; nonsubscriber issues; Appeals Panel decisions; national comparisons and other specific requests.
- See http://www.tdi.state.tx.us/company/roc.
- Suggestions include the following: a "Frequently Asked Questions" (FAQ) section; comparison of Texas system to other states; bulletin board; an area for service providers to list their products; more information on the ROC; link to a specific workers' compensation agency; provide unbiased research; and an update of the TWCC website.
- See Research and Oversight Council on Workers' Compensation, Agency Strategic Plan for the Fiscal Years 1999-2003 Period (June 15, 1998).
- See Texas Monitor (4:2 Special Edition, Summer 1999).
- An impairment rating can be given by the injured worker's treating doctor, a doctor hired by the insurance company, a designated doctor chosen by a mutual agreement between the insurance company and the injured worker or appointed by TWCC to settle a dispute, or an "other" doctor who may be consulted in the course of treatment.
- Maximum Medical Improvement (MMI) is defined as the earliest date after which further recovery can no longer be expected, or the expiration of 104 weeks from the date on which benefits begin to accrue (Texas Labor Code, Section 401.011). For injuries occurring on or after January 1, 1998, the date of MMI may be extended for injured workers who have had or will have spinal surgery within 12 weeks of the expiration of the 104-week period (Texas Labor Code, Section 408.104).
- It should be noted that the average time from first to last impairment rating might actually be lower than 177 days. Some observers have noted that in some cases, TWCC-69 forms (Report of Medical Evaluation) continue to be submitted to TWCC after the final impairment rating has been calculated. However, it is not possible after examining the data to determine which rating, in these situations, should be excluded. Consequently, these additional examinations are included in the calculations.
- See Texas Workers' Compensation Commission Pre-authorization Rule 134.600. A new pre-authorization rule has been proposed (Rule 134.601) which would reduce the number of treatments, tests, and services requiring pre-authorization from sixteen groups to five.
- See Texas Workers' Compensation Commission Rule 133.305.
- See Texas Labor Code, Chapter 413, Subchapter C.
- TWCC System Data Report as of December 1998.
- Texas Workers' Compensation Commission, System Data Report, as of June 1999. The TWCC System Data Report refers to completed disputes as disputes that are considered by TWCC. Of the 3,862 disputes received in 1998, 2,793 have been completed. Disputes not yet completed are regarded as pending. Since outcomes are crucial to this study, the word "disputes" will refer to completed disputes.
- This timeframe represents the date that the appeal was filed with SOAH to the date that the decision was rendered. Texas Workers' Compensation Commission, 1998.
- Texas Workers' Compensation Commission, Medical Dispute Resolution Information System (MDRIS) database, as of June 1999.
- Research and Oversight Council on Workers' Compensation, A n Examination of Strengths and Weaknesses of the Texas Workers' Compensation System (1998), p. 22; and Biennial Report of the Research and Oversight Council on Workers' Compensation (1998), p. 18.
- Texas Workers' Compensation Commission, Medical Dispute Resolution Information System (MDRIS), as of June 1999. Since pre-authorization disputes are based on treatments not yet approved or rendered, no corresponding medical billing data are available to determine the total dollar value associated with pre-authorization disputes.
- Texas Workers' Compensation Commission, Medical Forms database, as of June 1999.
- Research and Oversight Council on Workers' Compensation, Experiences of Doctors Who Practice in the Texas Workers' Compensation System (1998), p. 8.
- The clinical reviewers compared the Texas Spine Treatment Guideline and Upper Extremities Treatment Guideline with comparable guidelines in Washington, Florida, Minnesota, California, and Oregon. The clinical reviewers were given copies of each of the guidelines with the state names removed and asked to answer a series of questions, and to review the validity of the findings of a private consultant retained by the ROC (see Texas Monitor 4, number 2, Summer 1999). Each reviewer submitted his/her answers separately and did not examine the answers of the other reviewers. Four of the reviewers (two physicians and two chiropractors) were chosen by the Texas Medical Foundation and remained anonymous during this study; two reviewers (one physician and one chiropractor) were selected by the ROC.
- One reviewer also stated that Oregon's Carpal Tunnel, California's Low-Back, and Minnesota's Low-Back treatment guidelines may promote excessive use of specific kinds of treatments.
- Attended modalities are physical medicine treatments that require constant health care provider supervision; examples include electric stimulation (manual), ultrasound, and contrast baths. Examples of unattended modalities include hot and cold packs, whirlpool use, diathermy, and paraffin baths.
- "Social, economic, and psychological factors have been reported to be more important than physical factors in affecting the symptoms, response to treatment, and long-term outcomes of patients with chronic low-back problems." See U.S. Department of Health and Human Services, Agency for Health Care Policy and Research, Acute Low Back Problems in Adults (1994), p. 91.
- Examples of passive physical therapy modalities include massage therapy and hot and cold packs.
- The average expected medical cost of a workers' compensation claim in Texas (i.e., actual benefits paid plus projected medical benefits) as of 1999 for policy year 1995 is $4,912, compared to Florida ($4,844), California ($2,650), Minnesota ($1,919), and Oregon ($2,968). See National Council on Compensation Insurance, 1999 Annual Statistical Bulletin (1999).
This page was last updated on December 9, 2002.
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