Medical Care Choice and Attorney Involvement in Workers Compensation

Medical Care Choice and Attorney Involvement in Workers Compensation

January 31, 2018 Business Insurance and Risk Management, The Beacon Blog, Uncategorized 0 Comments

Depending on the state, choice of medical care in a workers compensation claim can be made by the employee, the employer or both. In about half the states and the District of Columbia employees have full control; however many states allow the employer to choose physicians either initially or during the entire process. (Pennsylvania is one of only six states where an employee’s choice is restricted to a list of employer-authorized physicians.)

Employers may believe with some justification that allowing them to choose physicians gives them more control over costs. A recent study in the Journal of Occupational and Environmental Medicine cautions there is a down side;  medical cost savings in employer-directed states are wiped out by increased attorney involvement.

The study looked at over 35,000 indemnity claims from a nationwide company between 2003 and 2015, in all states and the District of Columbia. States with employer-directed choice had higher attorney involvement and higher overall costs. Claims in those states also took longer to close. While the study used controls for “confounding” factors, it was limited to one employer with a disproportionate number of claims from California.

In spite of the limitations, it is a reasonable conclusion that injured workers with little or no choice in medical care will see the system as adversarial and seek legal representation. This perception will be reinforced by the commercials they see from workers compensation attorneys. If employers and/or insurers treat their claims with suspicion rather than support it will increase that perception.

There are no easy answers. If injured workers have free choice they may stick to family physicians who may not have the best qualifications to treat work related injuries. If employers or insurers choose medical care solely based on cost, workers may not get the best treatment. Workers compensation attorneys may direct their clients to preferred doctors or pharmacies  who will prolong treatment to increase their profits.

The best solution is to treat injured workers with compassion; help them navigate the claims process; and make recovery and return to work the primary goal rather than cost saving.

About the Author

Harry Cylinder

Harry Cylinder, CPCU, ARM has spent nearly fifty years in the insurance industry, the majority of the time as a consultant. He has been employed by The Beacon Group of Companies since 2008, specializing in the review and analysis of property and casualty coverage forms. Mr. Cylinder has been reviewing policy forms as they have evolved over the past decades. In 2008 he published an article in the CPCU Journal which was the first description of cyber insurance coverage for a general insurance audience. Since that time he has regularly written on cyber and other topics for The Beacon Companies’ blog.