C. Rome Is Burning

By: Publius

It’s official. The nonpartisan Legislative Analyst’s Office (LAO) has issued a report confirming what many people already know — recent Workers’ Compensation Appeals Board (WCAB) decisions in Almaraz, Guzman and Ogilvie will cost employers more money. These three cases are now the most visible measure of the steady erosion of the 2003-04 workers’ comp reforms, a process that began with a governor recalled and continues as the legacy of the governor who replaced him.

That legacy shows wear and tear from constant assault by disaffected doctors, lawyers, bureaucrats, workers’ comp judges and the governors’ own appointees — workers’ comp commissioners. The tarnish comes from more than these cases, as self-insured employers demonstrated in their ill-fated attempt at the end of the last legislative session. Even if you add med-legal and lien problems into the mix, as they tried to do, there remains much to be concerned about that is not likely to be addressed by anyone who holds elective office, at least not just yet.

After 2004’s deep reduction in costs, even current disturbing trends are not enough to do anything other than unsettle the business community. It is easier, as elected officials do, to shoot the messenger rather than hear the message. Labor is content to consider current complaints to be no more than self-inflicted wounds, arguing as it has over the past two decades that if reforms don’t perform as expected, employers have only themselves to blame. Besides, it is difficult to understand how labor would be motivated to do anything in 2010, given that current common wisdom holds for the imminent ascendancy of a Democratic governor after the elections.

Providers chafe under perceived abuses of medical provider networks (MPNs) and utilization review (UR). Some structural issues in MPNs, such as having nonoccupational medical providers in the network, create more problems than they solve.

Others, such as unlimited changes of physician within the MPN and complex problems of large statewide networks, are structural and require legislative intervention. Still others, such as arcane notice requirements for insurers, need to be rethought by the self-anointed “business-friendly” administration.

Recent changes in pharmaceutical reimbursement rates make PBMs even less of a panacea than before, and impending cuts in Medicare rates as part of national health care reforms will put even more pressure on occupational doctors, who will be asked to do even more for even less. The administration needs to fast-track revisions to the official medical fee schedule but also have a clear, articulate path to minimizing lien disputes by providers — especially when the lien is for services not authorized, the provider is not part of an MPN or the provider is balance-billing. And let’s not forget expensive copy services that provide constant “gifts” to applicant attorneys so they are chosen to execute subpoenas and get copy services, which become liens.

But payers and providers also need to work jointly on a solution. If anything positive came from the end-of-session drill this year, it should be that all affected parties need to be at the table, or at least have an opportunity to present their perspectives to ultimate decision makers. The “if I tell you I’ll have to shoot you” cloak-and-dagger style historically has produced poor results, especially when it has to do with providers. Like it or not, the system doesn’t function very well when providers are simply told “this is what is going to happen to you, so live with it.”

The med-legal process remains a growing toxic waste site. Advocating changes to that process with the goal of affecting outcomes is not reform; it’s who has leverage at any given moment in the Legislature.

The dispute resolution process, especially as it relates to medical and disability issues, needs to be rethought in its entirety. While it is true that judges address medical issues in civil courts, it is equally true that civil courts follow rules of evidence, something workers’ comp judges are not compelled to do. The Constitution envisions a system that is simple, relatively easy to navigate, and not a bureaucratic barrier to the ultimate goal of the system: getting injured workers back to work. That isn’t exactly WCAB’s hallmark.

Over the past several years, efforts have been made to improve return-to-work outcomes in California. They have failed. AB 227 and SB 899 programs don’t work. Could we all please agree to that? A pressing need remains to have a clear compliance track for all employers for their obligations under the Fair Employment and Housing Act, and that involves coordinating those standards, processes and timeframes with workers’ comp and its payors.

In this economy, it is also important to coordinate all return-to-work and adult education programs. The administration has not done this. But the bottom line is that whether a worker is laid off because of downsizing or because his/her job no longer exists after years of delay in getting a case through the workers’ comp system, the worker still needs a job. Other states have addressed this issue more effectively than California, and in 2008, employers presented a comprehensive return-to-work proposal for debate and review.

Remember that? Don’t worry; no one else does either. As long as return-to-work is considered a punishment to the employer rather than an opportunity for the injured worker, nothing will improve.

So there you have it. As we enter the final year of the Schwarzenegger administration, that smoke you smell is accompanied by the strains of violin music. Don’t look for much to change over the next year or so because the legislative and executive processes do not lend themselves to an open, honest discussion of the breadth of issues facing the workers’ comp system. Thanks goes out to LAO for peeking behind the curtain, but there is still a locked door behind it and the people who have the key aren’t about to let anyone else in. 




PUBLISHERS' NOTE: Publius is written by a consortium of writers, sometimes internal, most frequently external. Workers' Comp Executive believes that it has the responsibility to air most viewpoints and welcomes the comments of its community on any subject. Publius does not necessarily represent the views of this publication.