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ALBANY, NY (06/14/2012)(readMedia)– Two bills before the State Legislature could rollback cost savings created in the 2007 Workers’ Compensation reforms.

S.3749-C (Robach)/A.5183 (Simotas) would allow an injured employee to utilize any pharmacy that matched the state’s “published prices,” regardless of whether such pharmacy was in an employer’s network and offered “volume discounts” often significantly below “published prices”. The authorization of these pharmacy networks is one of the few parts of the system reform that was showing modest cost-savings of between 10 percent and 20 percent. This legislation would largely negate any benefit from the reform, by eliminating the basis on which networks would provide discounts.

Another attempt to rollback savings realized in the 2007 reforms, S.3741 (Maziarz)/ A.6294 (Wright), would prohibit any New York State Medical Treatment Guideline adopted by the Workers’ Compensation Board from being applied to injuries that occurred before the guideline’s adoption date. The guidelines, adopted in 2009 after a three year process involving input by a joint business/labor medical advisory committee and extensive public review and comment by all categories of medical professionals, are standards of care, identifying specific medical treatments that are considered appropriate and effective. Standards of health care are neither prospective nor retroactive, and any legislated arbitrary timeframe is completely contrary to evidence-based medical principles.

Regard of the outcome of these two bills, Workers’ Compensation rates continued to rise in New York. The amplified cost is driven by increases in maximum benefits indexed to increases in the state’s average weekly wage, and to the extremely slow pace and inefficient implementation of key system reform measures.

For example, in October 2011, the New York State Insurance Department approved an average rate increase of 9.1 percent, on the heels of a 7.7 percent increase in 2010. All told, between 2009 – 2012, rates have increased by 32.9 percent. Workers’ Compensation Board assessments, essentially a tax on workers’ compensation premiums have increased by 10.4 percent and 27 percent, respectively for the last two years. Employers are paying nearly 50 percent more of their compensation dollars in assessments to fund the system than they did three years ago.

These recent cost increases to the Workers’ Compensation system do nothing to help improve our states economic competitiveness and hurts New York-based businesses ability to create private-sector jobs. If we want to make New York a more business friendly state, we can start by letting the cost saving components of the 2007 Workers’ Compensation reforms take effect.

The City of Columbia, Mo.’s money-saving efforts include increasingly concentrated attempts to keep Workers’ Compensation costs down, says Sarah Perry, the city’s risk manager for more than 15 years and a member of NU’s Risk Managers Advisory Board.

Measures undertaken to that end include increased focus on work-zone safety measures for any public employee working on a roadway: police, firefighters, road crews, mowing crews from the parks and recreation department, and utilities workers. “Work-zone safety is [getting] a big push right now,” Perry says.

Columbia also is putting more emphasis on driver-safety measures among its public employees in order to prevent employee injuries and save lost work hours.

Perry also notes an increase in law-enforcement liability suits. It’s a trend she has come to recognize by the sheer number of claims that come across her desk and “how much time I have to spend with attorneys.”

Perry attributes the increase to both the slow economy—“people are looking for money from somewhere”—and changing public attitudes about law enforcement.

“There’s not that automatic level of respect anymore,” she says, “and because of that, we are seeing a lot more police cases filed.”

WC & THE ECONOMY

The economy has affected Workers’ Comp in two ways, according to Cindy Mallett, human-resources and risk manager for the city of Gainesville, Ga., who also currently serves as president of the Public Risk Management Association.

First, higher health-insurance premiums, deductibles and co-pays may encourage some employees who are “financially strapped and negatively motivated” to resort to filing frivolous claims, Mallet says.

And second, some city employees don’t want to draw attention or take sick leave for fear of jeopardizing their jobs, so they’re not reporting justifiable claims. “They’re fearful,” she notes. “Some of that might be easing a little bit, but it’s been a tough few years.”

On the pricing front in Workers’ Comp, Mallett says: “The market is starting to harden back up just a little bit. Pricing seems to be increasing, though I haven’t seen it in large percentages.”

The Workers’ Compensation Board announced that it intends to adopt new fee schedules for physicians, chiropractors, podiatrists, psychologists, and other medical professionals who treat injured workers.

The new fee schedules went into effect on June 1 and will incorporate the latest current procedural terminology codes from the American Medical Association. The fee schedules also incorporate technical changes to some ground rules.

Read more at the WorkersComp Forum homepage.

Injured who take opioids slower to return to work

NEW YORK – Workplace insurers are accustomed to making billions of dollars in payments each year, with the biggest sums going to employees hurt in major accidents, such as those mangled by machines or crushed in building collapses.

Now they are dealing with another big and fast-growing cost – payouts to workers with routine injuries who have been treated with strong painkillers, including many who do not return to work for months, if ever.

Workplace insurers spend an estimated $1.4 billion annually on narcotic painkillers, or opioids. But they are also finding that the medications, if used too early in treatment, too frequently, or for too long, can drive up associated disability payouts and medical expenses by delaying an employee’s return to work.

Workers who received high doses of opioid painkillers to treat injuries such as back strain stayed off the job three times longer than those with similar injuries who took lower doses, a 2008 study of claims by the California Workers Compensation Institute found.

When medical care and disability payments are combined, the cost of a workplace injury is nine times higher when a strong narcotic such as OxyContin is used than when a narcotic is not used, according to a 2010 analysis by Accident Fund Holdings, an insurer operating in 18 states.

“What we see is an association between the greater use of opioids and delayed recovery from workplace injuries,’’ said Alex Swedlow, the head of research at the California Workers Compensation Institute.

The use of narcotics to treat occupational injuries is part of a broader problem involving what many experts say is the excessive use of drugs such as OxyContin, Percocet, and Duragesic. But workplace injuries are drawing particular interest because the drugs are widely prescribed to treat common problems such as back pain, even though there is little evidence that they provide long-term benefits.

Along with causing drowsiness and lethargy, high doses of opioids can lead to addiction and have other serious side effects, including fatal overdoses.

Between 2001 and 2008, narcotics prescriptions as a share of all drugs used to treat workplace injuries jumped 63 percent, according to insurance industry data. Costs have also soared.

In California, for example, workplace insurers spent $252 million on opioids in 2010, a figure that represented about 30 percent of all prescription costs; in 2002, opioids accounted for 15 percent of drug expenditures.

As a result, states are struggling to find ways to reverse the trend, and some of them have issued new pain treatment guidelines, or are expected to do so soon. These states include New York, Colorado, Texas, and Washington.

Doctors in four states – Louisiana, Massachusetts, New York, and Pennsylvania – appear to be the biggest prescribers of drugs for workers’ injuries, according to a review of data from 17 states by the Workers Compensation Research Institute, a group in Cambridge, Mass.

Painkiller-related costs are also hitting taxpayers, who underwrite coverage for public employees such as police officers and firefighters, experts say.

There is little question that strong pain medications can help some patients return to work and remain productive. But injured workers on high doses of the drugs can develop chronic pain and face years of treatments.

In a sense, insurers are experiencing the consequences of their own policies. During the last decade, they readily reimbursed doctors for prescribing painkillers while eliminating payments for treatments that did not rely on drugs, such as therapy.

Those policies may “have created a monster,’’ said Dr. Bernyce M. Peplowski, the medical director of the State Compensation Insurance Fund of California, a quasi-public agency.

The National Football League and the Atlanta Falcons are suing nine former Falcons players to force them to litigate workers’ compensation cases in Georgia rather than in California, where dozens of current and former NFL players have sought compensation for injuries sustained from playing football.

The eight-page suit, filed by King & Spalding attorneys Darrick L. McDuffie and S. Stewart Haskins II on behalf of the Falcons and the NFL Management Council, asks U.S. District Judge Thomas W. Thrash Jr. to enforce what the suit called a binding arbitration ruling issued last month in New York.

That ruling by arbitrator Michael Beck ordered the nine former Falcons to halt their efforts to collect workers’ compensation benefits in California for injuries stemming from their careers with the Falcons.

When the suit was filed March 5, the players’ claims were pending before the workers’ compensation board in California, the complaint alleges.

The suit appears to be part of a broader fight between the league and the players over how and whether current and former players should be compensated for injuries incurred on the playing field.

The former Falcons players include Roderick Coleman, Wilrey Fontenot, Tony Gilbert, Kindal Moorehead, Stanley Pritchett, Karon Riley, Brett Romberg, Jason Webster and Dez White.

Professional football players injured while playing are generally entitled to workers’ compensation benefits while they are out of work; the benefits include pay for medical expenses arising from that injury, according to the NFL Players Association website.

“This is important since NFL clubs will not pay medical expenses after a player leaves the game unless the player files a workers’ compensation claim,” the website states.

The Atlanta suit is one of a number of federal suits the NFL and professional football teams are filing against hundreds of former football players who have lodged workers’ compensation claims in California, even when the teams for which they played are based elsewhere.

According to a 2010 New York Times investigation, California is the only state where professional athletes who have played as little as a single game in the state may file workers’ compensation claims for long-term injuries they may have sustained years earlier.

According the Times report, California law also bars employees from signing away certain workers’ rights and their unions from bargaining them away. Those policies have prompted the players association to argue that player contracts requiring them to file workers’ compensation claims in their teams’ home states may be unenforceable.

Football players from the Cincinnati Bengals, the Denver Broncos, the Tennessee Titans, the Miami Dolphins, the Kansas City Chiefs, the Chicago Bears, the New Orleans Saints and the Atlanta Falcons have filed workers’ compensation claims in California, according to national news reports.

California’s liberally construed workers’ compensation laws have been bolstered by the NFL’s current collective bargaining agreement with the players association. That agreement—which ended last year’s lockout—included a provision that allows players to file workers’ compensation claims in states where their teams aren’t based, according to the website Business Insurance.