Chapter 15 Workers’ Compensation Elsevier items and derived items © 2010, 2008 by Saunders, an...

Chapter 15Chapter 15

Workers’ Compensation Workers’ Compensation

Elsevier items and derived items © 2010, 2008 by Saunders, an imprint of Elsevier Inc.Elsevier items and derived items © 2010, 2008 by Saunders, an imprint of Elsevier Inc.

22Elsevier items and derived items © 2010, 2008 by Saunders, an imprint of Elsevier Inc.Elsevier items and derived items © 2010, 2008 by Saunders, an imprint of Elsevier Inc.

Workers’ CompensationWorkers’ Compensation

HistoryHistory First workers’ compensation laws were First workers’ compensation laws were

enacted in 1911.enacted in 1911. Today, all states have workers’ Today, all states have workers’

compensation laws.compensation laws. Workers’ compensation is the most important Workers’ compensation is the most important

coverage written to insure industrial coverage written to insure industrial accidents.accidents.


Workers’ Compensation StatutesWorkers’ Compensation Statutes

Federal compensation lawsFederal compensation laws apply to apply to miners, maritime workers, and government miners, maritime workers, and government workers.workers.

State compensation lawsState compensation laws apply to apply to employers and employees within each state.employers and employees within each state.


Workers’ Compensation ReformWorkers’ Compensation Reform

Laws address systematic abuse and fraud.Laws address systematic abuse and fraud. Laws vary from state to state.Laws vary from state to state. Issues include:Issues include:

proof of medical necessityproof of medical necessity preauthorization for treatmentpreauthorization for treatment medical bill reviewmedical bill review caps on vocational rehabilitationcaps on vocational rehabilitation use of mediatorsuse of mediators


Workers’ Compensation Laws Workers’ Compensation Laws and Insuranceand Insurance

PurposesPurposes Provide best available medical care to injuredProvide best available medical care to injured Ensure maximum recoveryEnsure maximum recovery Provide income to injured regardless of faultProvide income to injured regardless of fault Reduce overall expenses, resolution time, Reduce overall expenses, resolution time,

and litigationand litigation Encourage employer workplace safetyEncourage employer workplace safety Promote study of workplace accidents and Promote study of workplace accidents and

hazards and facilitate improvements hazards and facilitate improvements


Self-InsuranceSelf-Insurance

Company pays for medical expenses instead Company pays for medical expenses instead of insurance premiums.of insurance premiums.

Employee is covered by ERISA.Employee is covered by ERISA. Stop-loss provisions may be includedStop-loss provisions may be included Program may involve reinsurance on large Program may involve reinsurance on large

claims.claims. Captive insurance plans usually serve smaller Captive insurance plans usually serve smaller

companies; outside firms may administer companies; outside firms may administer claims processing.claims processing.


EligibilityEligibility

Private business, state, and federal Private business, state, and federal employees are entitled to workers’ employees are entitled to workers’ compensation coverage.compensation coverage.

A workplace accident that results in injury is A workplace accident that results in injury is covered.covered.

Illness or disease that results from Illness or disease that results from environmental factors in the workplace is environmental factors in the workplace is covered.covered.


CoverageCoverage

Federal LawsFederal Laws Government employees such as postal Government employees such as postal

workers and FBI agentsworkers and FBI agents Workers in Washington, D.C.Workers in Washington, D.C. Coal minersCoal miners Maritime workers such as longshoremen and Maritime workers such as longshoremen and

harbor workersharbor workers


Coverage (cont’d.)Coverage (cont’d.)

State Laws State Laws Provisions cover workers not covered by Provisions cover workers not covered by

federal laws.federal laws. Employer must purchase workers’ Employer must purchase workers’

compensation insurance from private compensation insurance from private company or be self-insured with adequate company or be self-insured with adequate cash reserves.cash reserves.

Employer must also have employers’ liability Employer must also have employers’ liability insurance.insurance.



State Laws (cont’d.)State Laws (cont’d.) Provide coverage for minorsProvide coverage for minors Most are effective outside the stateMost are effective outside the state Provide coverage for civil defense and other Provide coverage for civil defense and other

volunteer workersvolunteer workers Employer and physician requirements for Employer and physician requirements for

filing injury reports vary by state/territory filing injury reports vary by state/territory



Second-injury FundSecond-injury Fund Covers employee with previous injury or Covers employee with previous injury or

condition who is injured on the jobcondition who is injured on the job Encourages hiring of the physically Encourages hiring of the physically

handicappedhandicapped Allocates benefit costs more equitablyAllocates benefit costs more equitably



Minimum Number of EmployeesMinimum Number of Employees varies by state/territory varies by state/territory some occupations exemptedsome occupations exempted

Waiting PeriodWaiting Period required time period must elapse before required time period must elapse before

income benefits are payableincome benefits are payable


BenefitsBenefits

Types of state compensation:Types of state compensation: Medical treatmentMedical treatment Temporary disability indemnityTemporary disability indemnity Permanent disability indemnityPermanent disability indemnity Death benefits for survivorsDeath benefits for survivors Rehabilitation benefitsRehabilitation benefits


Types of State ClaimsTypes of State Claims

Nondisability (ND):Nondisability (ND): minor injury that requires minor injury that requires medical attention but employee still able to medical attention but employee still able to workwork

Temporary disability (TD):Temporary disability (TD): unable to perform unable to perform work duties for a specific time periodwork duties for a specific time period

Permanent disability (PD):Permanent disability (PD): unable to return to unable to return to previous occupation due to residual disabilityprevious occupation due to residual disability


Fraud and AbuseFraud and Abuse

Physicians are responsible for determining Physicians are responsible for determining legitimacy of work injuries and accurately legitimacy of work injuries and accurately reporting findings.reporting findings.

All individuals who deal with workers’ All individuals who deal with workers’ compensation cases must report suspicious compensation cases must report suspicious situations to the insurance carrier.situations to the insurance carrier.


Occupational Safety and Health Occupational Safety and Health Administration Act of 1970Administration Act of 1970

Act protects employees against workplace Act protects employees against workplace health and safety hazards.health and safety hazards.

Complaint procedure enables individuals to Complaint procedure enables individuals to pursue enforcement measures in their pursue enforcement measures in their workplace.workplace.

Noncompliance with work standards by Noncompliance with work standards by employers can result in fines.employers can result in fines.

Applies to most businesses.Applies to most businesses.


Legal SituationsLegal Situations

Medical EvaluatorMedical Evaluator Physician who conducts medical/legal Physician who conducts medical/legal

evaluations of injured workers evaluations of injured workers Must first pass a special medical exam for Must first pass a special medical exam for

certification by the Industrial Medical Councilcertification by the Industrial Medical Council Hired by insurance company or appointed by Hired by insurance company or appointed by

appeals boardappeals board Conducts unbiased assessment of disabilityConducts unbiased assessment of disability


Depositions and Medical Depositions and Medical TestimonyTestimony

Discover additional facts from the physician, patient, or Discover additional facts from the physician, patient, or other party about a case.other party about a case.

Proceedings take place under oath but not in open court.Proceedings take place under oath but not in open court. Findings may be used to impeach (challenge credibility) Findings may be used to impeach (challenge credibility)

a witness on cross-examination.a witness on cross-examination. Findings may be used when case comes to trial.Findings may be used when case comes to trial. Physician should be compensated for time spent Physician should be compensated for time spent

preparing to be an expert witness.preparing to be an expert witness. All agreements should be signed by the physician and a All agreements should be signed by the physician and a

lawyer.lawyer.


LienLien

Legal claim on the property of another for the Legal claim on the property of another for the payment of debtpayment of debt

Null and void at the end of a specified time Null and void at the end of a specified time limitlimit

Subsequent or amended lien can be filedSubsequent or amended lien can be filed Should be signed by patient/employee and Should be signed by patient/employee and

patient’s attorneypatient’s attorney


Lien (cont’d.)Lien (cont’d.)

AdvantagesAdvantages Court recognizes written agreementCourt recognizes written agreement Provides protection in event of litigationProvides protection in event of litigation Ensures payment for medical servicesEnsures payment for medical services Provides inexpensive means to collect full feesProvides inexpensive means to collect full fees Judge determines if fees are reasonable when Judge determines if fees are reasonable when

amount billed is more than amount allowedamount billed is more than amount allowed Helps avoid problems with collectionsHelps avoid problems with collections


Third-Party SubrogationThird-Party Subrogation

Transfers claims from workers’ compensation Transfers claims from workers’ compensation insurance carrier to third-party liability carrierinsurance carrier to third-party liability carrier

Used in events such as auto accidents where Used in events such as auto accidents where another party may be liable for the claimsanother party may be liable for the claims

Subrogated carrier has legal claim to Subrogated carrier has legal claim to reimbursement of expensesreimbursement of expenses


Medical ReportsMedical Reports

HIPAA–Health Insurance Portability andHIPAA–Health Insurance Portability and

Accountability ActAccountability Act Details specific rules for disclosure of Details specific rules for disclosure of

personal health informationpersonal health information Goal is to facilitate payment on claims for Goal is to facilitate payment on claims for

injured or ill worker, but still limit the amount injured or ill worker, but still limit the amount of information disclosed under the Privacy of information disclosed under the Privacy RuleRule


Health Information Record Health Information Record KeepingKeeping

Maintain a separate medical record.Maintain a separate medical record. Maintain a separate financial ledger.Maintain a separate financial ledger. Keep appointments for occupational injury or Keep appointments for occupational injury or

illness separate from unrelated matters.illness separate from unrelated matters. Keep documentation or dictation for each Keep documentation or dictation for each

appointment separate.appointment separate.


TerminologyTerminology

Most workers’ compensation cases involve Most workers’ compensation cases involve accidents causing bodily injury.accidents causing bodily injury.

Become familiar with anatomic terms, Become familiar with anatomic terms, directional and ROM words, types of directional and ROM words, types of fractures, body activity terms, and words that fractures, body activity terms, and words that describe pain and symptoms.describe pain and symptoms.


Reporting RequirementsReporting Requirements

Employer’s ReportEmployer’s Report Employer must file report within a specified time Employer must file report within a specified time

limitlimit

Medical Service OrderMedical Service Order Authorizes a physician to treat the injured Authorizes a physician to treat the injured

employeeemployee

Doctor’s First ReportDoctor’s First Report Physician must complete standard form or Physician must complete standard form or

narrative letter after first exam of the employeenarrative letter after first exam of the employee


Physician’s First Report (cont’d.)Physician’s First Report (cont’d.)

Original to insurance carrierOriginal to insurance carrier Copies to Copies to

state agencystate agency patient’s employerpatient’s employer physician’s filephysician’s file


Narrative Medical Report IssuesNarrative Medical Report Issues

HistoryHistory Present complaintsPresent complaints Past historyPast history Examination Examination

findingsfindings Diagnostic Diagnostic

impressionimpression

Disability/PrognosisDisability/Prognosis Work LimitationsWork Limitations CausationCausation


Reporting Requirements (cont’d)Reporting Requirements (cont’d)

Supplemental ReportSupplemental Report Sent to the insurance carrier after 2 to 4 Sent to the insurance carrier after 2 to 4

weeks of treatment to note current statusweeks of treatment to note current status

Progress ReportProgress Report Sent to the insurance carrier if there is Sent to the insurance carrier if there is

significant change in prognosis or statussignificant change in prognosis or status


Final ReportFinal Report

Physician sends to insurance carrier when Physician sends to insurance carrier when patient is discharged or treatment is complete patient is discharged or treatment is complete

Signals the end of temporary disability Signals the end of temporary disability benefits benefits


Doctor’s Final Report and BillDoctor’s Final Report and Bill

Indicates any impairment or permanent Indicates any impairment or permanent disabilitydisability

Accompanied by a statement listing total Accompanied by a statement listing total expenses incurredexpenses incurred


Claim SubmissionClaim Submission

Financial ResponsibilityFinancial Responsibility Workers’ compensation insurance is billed for Workers’ compensation insurance is billed for

all expenses.all expenses. Physician agrees to accept payment Physician agrees to accept payment

according to carrier’s fee schedule.according to carrier’s fee schedule. Patient’s health insurance information should Patient’s health insurance information should

also be obtained and filed in case of non-also be obtained and filed in case of non-related medical expenses.related medical expenses.


Claim Submission (cont’d.)Claim Submission (cont’d.)

Fee SchedulesFee Schedules May follow special workers’ compensation or May follow special workers’ compensation or

Medicare fee scheduleMedicare fee schedule Some include maximum reimbursement Some include maximum reimbursement

amountsamounts Employer, state agency, insurance carrier, or Employer, state agency, insurance carrier, or

payer may audit or review feespayer may audit or review fees


Claim Submission (cont’d.)Claim Submission (cont’d.)

Electronic Claims Submission & ReportsElectronic Claims Submission & Reports Carriers may have separate claim for Carriers may have separate claim for

workers’ comp (not CMS-1500 [08-05])workers’ comp (not CMS-1500 [08-05]) Electronic system or telephone submissionElectronic system or telephone submission

Out-of-State ClaimsOut-of-State Claims Follow regulations for state in which injured Follow regulations for state in which injured

worker was hiredworker was hired Obtain and follow out-of-state fee schedule Obtain and follow out-of-state fee schedule

for billing purposesfor billing purposes


Delinquent or Slow Pay ClaimsDelinquent or Slow Pay Claims

Phone patient’s employer to verify information.Phone patient’s employer to verify information. Send copy of claim form and itemized account Send copy of claim form and itemized account

statement to carrier.statement to carrier. Phone insurance carrier after 45 days and Phone insurance carrier after 45 days and

request expected date of payment.request expected date of payment. Send employer copy of financial account Send employer copy of financial account

statement with outstanding balance.statement with outstanding balance. Contact state board if employer fails to file Contact state board if employer fails to file

Employer’s Report of Work Injury.Employer’s Report of Work Injury.

Chapter 15 Workers’ Compensation Elsevier items and derived items © 2010, 2008 by Saunders, an...

Documents

Transcript of Chapter 15 Workers’ Compensation Elsevier items and derived items © 2010, 2008 by Saunders, an...