7/22/2020 | This week in Business Insurance Workers Compensation… – Editor
By Louise Esola
As of 2020 most states have regulations on prescribing and managing opioids, but fewer than half have in place such protective measures as drug formularies and mandated drug rehabilitation, according to a report released Tuesday by the Workers’ Compensation Research Institute.
Researchers with the Cambridge, Massachusetts-based organization gathered data from all 50 states on recent laws, prescribing guidelines and such programs as prescription monitoring for controlled substances to measure how states have been managing the opioid crisis and the emergence of medical marijuana laws.
The report found all but six states have limits on how many opioids can be prescribed and for how long. All but one state has in place a statewide, mandated prescription drug monitoring program; Missouri made its PDMP optional, but data shows that 80% of the state’s population lives in a municipality that keeps track of prescriptions, according to the report.
While most states have in place prescribing guidelines, only 15 have drug formularies, or approved drug lists, for workers compensation, according to the report.
The report also shows a lag in drug abuse treatment options, as only 17 states definitively include “mental health services” for “drug rehabilitation” in workers comp statutes.
By Louise Esola
The top 5% of costliest workers compensation claims account for 25% of total physical therapy costs, with the average cost associated with that top 5% more than five times the average cost, according to a white paper released Wednesday by One Call Care Management Inc.
The Jacksonville, Florida-based managed care organization that serves injured workers used its 2019 database in its study of what it called “at-risk” cases, finding that predictive analytics can help identify such injured workers early in the claims process.
“To date, the inherent problem has been the difficulty in accurately identifying these individuals early enough to develop and implement an intervention plan quickly and change the potential outcome of the injured worker’s treatment,” the paper states. “Historically, these cases were identified as problematic and at-risk only after a treatment plan exceeded the initial guidelines, and by then, it was too late to reverse course.”
By assessing such issues as a claimant’s type of work and medical history, “predictive analytics can identify specific triggers that pinpoint an at-risk case and flag it at the onset of treatment,” the paper states.
“This enables the therapist to create a more proactive approach to their treatment plan.”
By Louise Esola
Health care workers and those working in protective services accounted for 83.3% of COVID-19 indemnity workers compensation claims filed in Florida as of May 31, according to a report issued Tuesday by the Florida Department of Financial Services, Division of Workers’ Compensation.
The report tallied 3,807 time-off, virus-related claims filed since the start of the pandemic, totaling $3.2 million in benefits paid. It found that that 45.7% of claims came from health care workers and 37.6% from the protective services sector, which includes first responders.
Service industry workers represented 9.1% of claims, office workers 6.1%, and airline workers 1.5%.
Self-insured governments paid the largest amount at $1.8 million. Private insurers paid $856,484, according to the report.
COVID-19 claims accounted for 2.9% of total paid workers compensation benefits in Florida from the start of the pandemic through May 31.
The report said there were 1,718 claims denials — 1,695 total denials and 23 partial denials. Nineteen of the claim denials were in the health care space, according to the report.
March saw the most claims, with 1,949 filed. The figures tapered down to 300 claims in May.
By Louise Esola
Years of profitable underwriting and healthy reserves in 2019 in the workers compensation sector will help the industry weather coronavirus-related claims and lower premium in the coming months, officials with the National Council on Compensation Insurance said Tuesday.
But it remains unclear what level of claims workers comp insurers should expect from the COVID-19 outbreak or how hard higher unemployment numbers will hit payroll-related premium payments, they said.
The Boca Raton, Florida-based institute held its Annual Issues Symposium online in one afternoon after canceling the live two-day event due to the pandemic, which was the topic officials zeroed in on when discussing the financial state of the industry.
“The two themes you will hear are unprecedented financial strength and consistent performance,” said Donna Glenn, NCCI’s chief actuary, in a “state of the line” presentation that addressed where the industry stands as it faces unanswered questions regarding the pandemic’s effect on financial results.
“The system is well-positioned to face COVID-19 stress,” she said.
The workers comp sector has reported profitable results in recent years. In 2019, the industry reported a combined ratio for private carriers of 85%, making it the sixth consecutive year that the workers comp line of business has posted an underwriting gain. Last year also marked the third consecutive year of a combined ratio under 90%. The two most recent years, including the 83% combined ratio in 2018, showed the lowest workers comp combined ratio since the 1930s, according to the presentation.
Going forward, however, the industry will be deeply affected by COVID-19 claims, said Bill Donnell, NCCI president and CEO.
“Every aspect of workers compensation will be affected” by the pandemic, including claim activity stemming from infections, the extent of which is still unknown, and claims in states adopting changes to workers comp laws that would provide presumption coverage for frontline workers outside of health care who are usually not covered by for viral infections.
Several sectors, such as hospitality and tourism, will also see steep drops in premium as they are hit with record unemployment levels, NCCI officials said.
But the workers compensation industry ended 2019 in a “position of strength,” Mr. Donnell said.
Ms. Glenn highlighted that as of year-end 2019, the overall reserve position for private insurers stood at a $10 billion redundancy, doubled from $5 billion at year-end 2018. This means premium rates continued to outpace loss costs.
Meanwhile, average lost-time claim frequency across all 38 states that work with NCCI declined by 4% in 2019, on a preliminary basis, and preliminary 2019 accident year data showed average indemnity claim severity increased by 4% relative to the corresponding 2018 value. Medical lost-time claim severity increased by 3%.
Looking ahead, Ms. Glenn said one of the “biggest unknowns” will be the length of shutdowns. In addition, different industries will post different results. The decline in hospitality, manufacturing and distribution, for example, could be offset by increased demand for health care, groceries and home delivery of goods. In the “middle,” many industries have increased telecommuting, which has led to fewer layoffs in some fields.
Meanwhile, the industry should expect midterm premium adjustments that take into account lower payroll figures, she said.
Claim activity will also vary, Ms. Glenn said. Some employees may delay care or not report claims, and some existing claimants could see their return to work and recovery hindered by fewer jobs and doctor check-ups. “Hard data” on the overall effect of the pandemic will be “extremely limited,” she said.
“In the coming quarters we will continue to learn more,” she said.
By Louise Escola
A workers compensation insurer failed to prove that a security guard’s fall that resulted in a hospital treatment for a brain injury was “idiopathic,” or unexplained, the Workers’ Compensation Court of Montana ruled Tuesday in denying a summary judgment to the insurer.
Margie Dargin fell during her shift as an Allied Universal employee providing security for an oil refinery in Billings, Montana. She has no recollection of how she fell or what happened after her fall, which caused her to be hospitalized for a week, according to documents in Margie Dargin v. XL Insurance of America, filed in Helena.
Ms. Dargin suffered a head injury along with a seizure in the time following her fall. A doctor “stated that it was her opinion that Dargin did not fall as a result of a seizure” and “opined that Dargin ‘somehow had a head injury’ and that she was suffering from post-concussive syndrome,” court documents state.
A second doctor commented that Ms. Dargin’s history is “incomplete” and was therefore unable to state whether she had a pre-existing condition that could cause her to have a seizure and fall, or whether a head injury caused the brain condition leading to the seizure post-fall, according to documents.
XL Insurance, which denied her claim on the basis that she fell on a level surface, moved for summary judgment before the state Workers’ Compensation Court, arguing that the cause of the fall was not “arising out of” her employment in accordance with state law, according to documents.
The court ruled that the insurer, meanwhile, failed to prove the fall was idiopathic, writing that XL Insurance “did not meet its burden of establishing that there are no issues of material fact as to whether Dargin suffered an idiopathic fall onto a level surface” and that “it is not entitled to summary judgment on those grounds.”
by Angela Childers
Nearly three months after most of the U.S. shut down to control the spread of COVID-19, some workers compensation claims figures are in from monopolistic states.
Since March 11, the Ohio Bureau of Workers Compensation has received fewer than 500 total claims for workers compensation from COVID-19. The majority of the claims were made by health care workers, first responders and corrections officers.
Among private employers, 36% of COVID-19 claims were denied or dismissed with the rest either accepted or pending. About a quarter of claims made by workers of self-insured employers were rejected with the remainder either certified as compensation claims or pending.
The BWC noted that some of the dismissed claims were withdrawn by injured workers who mistakenly thought they were applying for unemployment.
In Washington state, the Department of Labor & Industries has received a little more than 1,000 COVID-19 related compensation claims. The figure does not include claims made to self-insured employers.
A spokesman for L&I said not all of the claims were made by people who were sick with coronavirus, but were made by people asked to quarantine.
The workers compensation funds in North Dakota and Wyoming did not return calls for information.