Title: Overview of Recent Workers Compensation Research Findings
1Overview of Recent Workers Compensation Research
Findings
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- DC Campbell, Researcher
- Texas Department of Insurance, Workers
Compensation Research and Evaluation Group
2This presentation will highlight
- Medical costs and medical denial rates
- Return-to-work rates using Texas Workforce
Commission (TWC) wage data - Updates on WC network participation
- Recent pharmacy descriptive statistics and
- Descriptive statistics on recipients of permanent
impairment income benefits.
3- Medical Costs and Medical Denial Rates
4Average Professional and Hospital Costs Per
Claim, Injury Years 2003 and 2006, One Year
Post-Injury
Source Texas Department of Insurance, Workers
Compensation Research and Evaluation Group, 2007.
5Percentage of Professional and Hospital Medical
Services Denied for the Top 25 Workers
Compensation Carriers for Service Years 1998-2007
Source Texas Department of Insurance, Workers
Compensation Research and Evaluation Group,
2008. 1 Denial rates for 2005 and 2007 should be
interpreted with caution since the data may be
incomplete. 2 House Bill (HB) 2600, a workers
compensation reform bill aimed at reducing
medical costs, was passed in 2001. 3 In August
2003, the most recent professional medical fee
guideline, which incorporated Medicares payment
policies, went into effect.
6Percentage of Professional and Hospital Medical
Billing Lines Paid and Denied forWorkers
Compensation Network and Non-Network Claims,
Service Year 2007
Source Texas Department of Insurance, Workers
Compensation Research and Evaluation Group, 2008.
7Most Frequent Denial Reasons for Network and
Non-Network Claims, Service Year 2007
Source Texas Department of Insurance, Workers
Compensation Research and Evaluation Group,
2008. Note Percentages do not add up to 100
since insurance carriers may assign more than one
reason to each denial.
8- Return-to-Work Rates Using
- Texas Workforce Commission (TWC)
- Wage Data
9Initial Return-to-Work Rate
Percentage of Injured Workers Back At Work for
the First Time 6 Months to 3 Years Post-Injury
Source Texas Department of Insurance, Workers
Compensation Research and Evaluation Group,
2007. Note 1 The study population includes
329,986 workers injured in 2001-2005 who also
received temporary income benefits (TIBs). Note
2 Although the increases of initial RTW rates
were small, they were statistically significant
at the 0.01 significance level. While this
reflects a improvement in the percentage of
workers who have initially returned to work, the
difference is not big enough to conclude that the
WC system improved substantially during this time.
10Sustained Return-to-Work Rate
Percentage of Injured Workers Back At Work and
Remained for Three Successive Quarters Beginning
With the Initial RTW Quarter 6 Months to 3 Years
Post-Injury
Source Texas Department of Insurance, Workers
Compensation Research and Evaluation Group,
2007. Note 1 The study population includes
329,986 workers injured in 2001-2005 who also
received temporary income benefits (TIBs).
11Mean and Median Days Off Workfor Injured Workers
Who RTW At Some Point Post Injury, Injury Years
2001-2004
Source Texas Department of Insurance, Workers
Compensation Research and Evaluation Group,
2007. Note1 The mean and median days off work in
2004 may be under-estimated due to data maturity
and should be viewed with caution. Note2 Days
Off Work was defined as days from the injury
date to the initial RTW date. Please note that
these numbers do not take into account any
additional time off work that may have occurred
after the initial RTW date. Note3 The analysis
was based on the claimants who returned to work,
and did not include those who did not return by
the end of 2006. Injury year 2005 was excluded
because of insufficient data.
12- Updates on WC Network Participation
13- Carrier Data Calls
- In Sept 2006, March 2007 and November 2007 TDI
issued a data call to the top 13 insurance
carrier groups (in terms of premium market share)
to ask about WC health care network
participation - The top 13 groups represent approximately 82 of
the WC premium written in Texas - Network Data Call
- In February 2007, October 2007 and February 2008
TDI issued a data call to all WC certified
networks - Data call included two parts
- Info on how many workers have been treated in
network - Info on how many insurance carriers the network
has contracted with and for how long and
14Results of Carrier Data Call
- 12 out of 13 carrier groups have contracted with
or established a certified WC network (an
increase from 9 in Sept 2006) - 11 of the 12 carrier groups with a network have
already begun offering it to policyholders along
with a premium credit - Most premium credits offered for network
participation are 10-12 - Network participation among policyholders varies
widely for carriers - as of March 1st, 2007 approx 29,000
policyholders agreed to participate in networks
compared to only 7,500 as of Sept 1st, 2006 - Most of these policyholders (81 were small and
mid-sized employers) - These carriers estimated that the number of
claims treated in network would grow to over
100,000 by CY 2009.
15Results of Network Data Call
- 18 of the 31 networks certified by TDI had
treated injured workers as of Feb 1st, 2008 - A total of 39,991injured workers treated by these
18 networks (2 networks alone treated 77 of
these workers) - About 6 percent of the workers treated in network
had legacy claims (i.e., injuries prior to the
network cert date) - About 40 percent of the workers treated in
network had lost-time claims, meaning at least
one day of lost time was recorded - As of Feb 1st, 9 of the 31 networks certified by
TDI did not have any insurance carrier contracts
in place
16Geographic Distribution of Lost-Time Claims
Treated by TDI-Certified Networks as of February
1, 2008
Source Texas Department of Insurance, Workers
Compensation Research and Evaluation Group,
2008. Note Lost-time claims are claims in
which at least one day of lost-time was recorded.
17Pharmacy Descriptive Statistics
18Distribution of Medical Payments in the Texas
Workers Compensation System, Service Years 2005
- 2006
Source Texas Department of Insurance, Workers
Compensation Research and Evaluation Group,
2008. Note 1 Percent of Total Payments may not
add up to 100 because of rounding. Note 2 The
California Workers Compensation Institute (CWCI)
estimates that in 2005 Californias Pharmacy cost
was 7 percent of that states medical costs.
19Injured Employees Receiving Prescriptions in the
Texas Workers Compensation SystemPrescription
Years 2005 - 2006
Source Texas Department of Insurance, Workers
Compensation Research and Evaluation Group,
2008.
20Distribution of Pharmaceutical Utilization and
Payments by Injury Year Prescription Year 2006
Source Texas Department of Insurance, Workers
Compensation Research and Evaluation Group,
2008.
21Average Pharmaceutical Utilization and Payments
Per Injured Employee by Injury Year,
Prescription Year 2006
Source Texas Department of Insurance, Workers
Compensation Research and Evaluation Group,
2007.
22Distribution of Pharmaceutical Prescriptions by
Therapeutic Classification GroupPrescription
Year 2006
Source Texas Department of Insurance, Workers
Compensation Research and Evaluation Group,
2008. Note Texas WC prescriptions in 2006 were
for 6,001 unique Drug Names from 626 Subclasses.
The Subclasses fall into 89 distinct Therapeutic
Classification Groups as defined by the Medi-Span
classification system
23Generic Substitution Rate Where Generics Were
Available Prescription Year 2006
Source Texas Department of Insurance, Workers
Compensation Research and Evaluation Group,
2008. Note Approximately 85,000 prescriptions
(5 percent) did not have generics available
24 Generic Substitution RatesTherapeutic
Classification Groups Prescription Year 2006
Source Texas Department of Insurance, Workers
Compensation Research and Evaluation Group,
2008.
25- Descriptive Statistics on Recipients of Permanent
Impairment Income Benefits in the Texas WC System
26Five types of income benefits are payable under
the Texas Workers Compensation Act
- Temporary Income Benefits (TIBs) paid during
the period of temporary disability (lost time
from work) while the worker is recovering from an
on-the-job injury - Impairment Income Benefits (IIBs) paid to
injured workers for permanent impairment
(impairment evaluations are currently based on
the Guides to the Evaluation of Permanent
Impairment, 4th Edition, published by the
American Medical Association) - Supplemental Income Benefits (SIBs) paid to
injured workers for ongoing disability after IIBs
have been exhausted, with all eligibility for
SIBs ending at 401 weeks after the date of
injury Only workers with a 15 percent
impairment rating and who are unemployed or
underemployed as a result of their work-related
injuries are eligible to receive SIBs - Lifetime Income Benefits (LIBs) paid for the
life of the injured worker for specific
catastrophic injuries as set forth in Section
408.161 of the Texas Labor Code and - Death Benefits (DBs) and Burial Benefits paid
to the deceased workers spouse or eligible
beneficiaries as a result of a death from a
compensable injury.
27Purpose of This Analysis
- This study aims to provide basic descriptive
information regarding the frequency and amount of
Impairment Income Benefits (IIBs) and
Supplemental Income Benefits (SIBs) received by
injured workers in the Texas workers
compensation system from 1996 to 2005. - This analysis focuses on IIBs and SIBs since
these benefits are paid to severely injured
workers who generally have the hardest time going
back to work after an injury.
28Impairment Income Benefits (IIBs)
- Workers may receive IIBs once TIBs have ended
(either as a result of the worker reaching
maximum medical improvement or going back to
work) however, workers may receive IIBs (unlike
TIBs) while back at work. - IIBs are generally paid weekly and are equal 70
percent of the worker's average weekly wage. - An injured worker becomes eligible for IIBs the
day after the worker reaches maximum medical
improvement (MMI). - IIBs are currently calculated based on the
injured workers impairment rating, which is
assigned by a doctor using the American Medical
Associations Guides to the Evaluation of
Permanent Impairment, 4th edition. - Workers receive three weeks of IIBs for every
percentage point of impairment assigned. For
example, if an injured worker has an impairment
rating of 6 percent, the worker would receive 18
weeks of impairment income benefits.
29Total Number of Injured Workers Who Received
IIBs Injury Years 1996-2005
Source Texas Department of Insurance Workers
Compensation Research and Evaluation Group,
2008. Note 1 Injury year 2005 data should be
interpreted with caution since data may not be
complete. Note 2 Claims that did not have a
valid claim, benefit and impairment rating record
on file with the Division of Workers
Compensation were excluded from this analysis.
30Percentage of Workers Receiving Medical Services
in 2003 Who Also Received IIBs or SIBs
Source Texas Department of Insurance Workers
Compensation Research and Evaluation Group,
2008. Note Medical services include
professional and hospital services rendered
during 2003. Pharmacy services are excluded from
this analysis since pharmacy data was not
available for 2003.
31Average IIBs Duration Per Worker Injury Years
1996-2005
Source Texas Department of Insurance Workers
Compensation Research and Evaluation Group,
2008. Note 1 Injury year 2005 data should be
interpreted with caution since data may not be
complete. Note 2 Claims that did not have a
valid claim, benefit and impairment rating record
on file with the Division of Workers
Compensation were excluded from this analysis.
32Distribution of Most Recent Impairment Rating
Received by IIBs Recipients, Injury Years
1996-2005
Source Texas Department of Insurance Workers
Compensation Research and Evaluation Group,
2008. Note 1 Injury year 2005 data should be
interpreted with caution since data may not be
complete. Note 2 Claims that did not have a
valid claim, benefit and impairment rating record
on file with the Division of Workers
Compensation were excluded from this analysis.
33IIBs Recipients Who Received Statutory Maximum
and Minimum Weekly IIBs
- The statutory maximum IIBs benefit payable to
injured workers is 70 of the State Average
Weekly Wage (SAWW) - The SAWW for WC purposes is based on 88 of the
average weekly wage for all covered employment as
calculated by the Texas Workforce Commission
(TWC) - As of 2006, approximately 21 of workers
receiving IIBs were capped at the statutory
maximum weekly IIBs rate currently 498/week - As of 2006, approximately 2 of workers receiving
IIBs received the statutory minimum weekly IIBs
rate currently 107/week - Statutory changes made by HB 7 in 2005 to the
calculation of the statutory maximum weekly
benefit increased the maximum weekly IIBs payment
from 378 in FY 2006 to 498 in FY 2008, which
should result in a lower percentage of workers
being capped at the statutory maximum in future
years
34Impairment Income Benefits (IIBs)
- Workers may receive IIBs once TIBs have ended
(either as a result of the worker reaching
maximum medical improvement or going back to
work) however, workers may receive IIBs (unlike
TIBs) while back at work. - IIBs are generally paid weekly and are equal 70
percent of the worker's average weekly wage. - An injured worker becomes eligible for IIBs the
day after the worker reaches maximum medical
improvement (MMI). - IIBs are currently calculated based on the
injured workers impairment rating, which is
assigned by a doctor using the American Medical
Associations Guides to the Evaluation of
Permanent Impairment, 4th edition. - Workers receive three weeks of IIBs for every
percentage point of impairment assigned. For
example, if an injured worker has an impairment
rating of 6 percent, the worker would receive 18
weeks of impairment income benefits.
35Impairment Income Benefits (IIBs)
- Workers may receive IIBs once TIBs have ended
(either as a result of the worker reaching
maximum medical improvement or going back to
work) however, workers may receive IIBs (unlike
TIBs) while back at work. - IIBs are generally paid weekly and are equal 70
percent of the worker's average weekly wage. - An injured worker becomes eligible for IIBs the
day after the worker reaches maximum medical
improvement (MMI). - IIBs are currently calculated based on the
injured workers impairment rating, which is
assigned by a doctor using the American Medical
Associations Guides to the Evaluation of
Permanent Impairment, 4th edition. - Workers receive three weeks of IIBs for every
percentage point of impairment assigned. For
example, if an injured worker has an impairment
rating of 6 percent, the worker would receive 18
weeks of impairment income benefits.
36Supplemental Income Benefits (SIBs)
- An injured worker may receive SIBs if
- the worker has an impairment rating of 15 percent
or more and - the worker has not returned to work because of
the impairment, or has returned to work but is
earning less than 80 percent of his pre-injury
average weekly wage because of the impairment
and - the worker did not take a lump sum payment of
impairment income benefits and - the worker has tried to find a job that matches
his or her ability to work. - Injured workers must meet SIBs eligibility
requirements on a quarterly basis (the first
quarter the DWC makes the SIBs eligibility
determination all subsequent quarters, the
injured worker must apply to the insurance
carrier for eligibility, but may dispute to DWC
if denied). - SIBs are paid on a monthly basis and equal 80
percent of the difference between 80 percent of
the worker's average weekly wage and the weekly
wage after the injury. - An injured worker becomes eligible for SIBs the
day after IIBs end.
37Total Number of Injured Workers Who Received
SIBs Injury Years 1996-2004
- Source Texas Department of Insurance Workers
Compensation Research and Evaluation Group, 2008. - Note 1 Injury year 2004 data should be
interpreted with caution since data may not be
complete. Injury Year 2005 was excluded from
this analysis since few workers injured in 2005
have exhausted their IIBs and are eligible to
receive SIBs. - Note 2 Claims that did not have a valid claim,
benefit and impairment rating record on file with
the Division of Workers Compensation were
excluded from this analysis.
38SIBs Recipients Who Received Statutory Maximum
SIBs
- The statutory maximum SIBs benefit payable to
injured workers is 70 of the State Average
Weekly Wage (SAWW) - The SAWW for WC purposes is based on 88 of the
average weekly wage for all covered employment as
calculated by the Texas Workforce Commission
(TWC) - As of 2006, approximately 19 of workers
receiving SIBs are currently capped at the
statutory maximum weekly SIBs rate currently
498/week - There is currently no minimum weekly SIBS rate
payable to injured workers - Statutory changes made by HB 7 in 2005 to the
calculation of the statutory maximum weekly
benefit increased the maximum weekly SIBs payment
from 378 in FY 2006 to 498 in FY 2008, which
should result in a lower percentage of workers
being capped at the statutory maximum in future
years
39Estimated Number and Percent of SIBs Recipients
Who Reached 401 Weeks Statutory Benefit Maximum
Duration, Injury Years 1996-2000
Source Texas Department of Insurance Workers
Compensation Research and Evaluation Group,
2008. Note 1 Injury year 2000 data should be
interpreted with caution since data may not be
complete. Injury Years 2001-2004 was excluded
from this analysis since workers injured in
2001-2004 have not had the opportunity to receive
401 weeks of SIBs. Note 2 Claims that did not
have a valid claim, benefit and impairment rating
record on file with the Division of Workers
Compensation were excluded from this analysis.
40Upcoming Research Reports
- Update on claim and medical denial rates
- Update on use of medical peer reviews (results
from recent data call) - Analysis of access to care for non-network
claims - Update of employer participation estimates in the
Texas WC system and employee coverage rates - Next WC network report card (due in Sept)
- Biennial report on impact of HB 7 on
affordability and availability of WC insurance
for Texas employers (due December 1, 2008) - Biennial report on impact of HB 7 on medical
costs, quality of care and medical dispute
resolution (due December 1, 2008).