Tag Archives: comorbidity

How to Monetize Medical Management

Over the past 25 years, the workers’ comp industry has collected vast amounts of data, and organizations within the industry have easy access to this valuable asset. Their challenge now is to profit from it.

Experts say medical costs now amount to 60% of claim costs in workers’ comp. If true, organizations should be charging ahead to find ways to optimize medical loss management and monetize their data for profit.

See also: Intelligent WC Medical Management  

The first step toward monetizing medical data is to integrate it from disparate data silos. All bill review, claims system, pharmacy (PBM) and other relevant data should be integrated at the claim level to gain a full picture of individual claims. Once integrated, predictive analytics methodologies can be applied to convert the data to usable information.

You need to analyze historic data using predictive analytics to discover conditions that are cost drivers or cost accelerators. What conditions or combinations initiate or perpetuate high-cost situations? Where are the gaps in timing in operational flow? What actions encourage positive or negative claim resolution? And the information must be made actionable.

Predictive analytics has determined the comorbidity of diabetes adds complexity and cost to claims, so an alert can be generated, and key Information conveyed to appropriate persons.

Based on predictive analytics, the probable ultimate medical costs for the claim are portrayed for the claims rep along with other key information regarding the claim in question. The claims rep adjusts medical reserves accordingly and moves on. Time is saved, and accuracy is optimized.

At the same time, the predictive analytics-informed system automatically notifies the nurse case manager based on the organization’s referral protocol. The claims rep is informed of the referral but is not required to take action.

Similar claim information is presented to the nurse case manager for quick review, thereby integrating and coordinating claims and nurse case management initiatives.

Data is made intelligent and can be monetized through predictive analytics combined with a timely information delivery system. Searching for decision-support information takes time and is inefficient. Manually entering data is time-consuming, annoying and often inaccurate. On the other hand, intelligent information delivered appropriately is monetized as claim stakeholders make informed decisions quickly, effortlessly and accurately without need for data gathering and data entry.

Projected probable ultimate claim cost with comprehensive supportive information displayed for claims reps does not require data search or data entry. Even less-experienced adjusters are accurate and efficient. Accuracy and efficiency is optimized, productivity is increased and profitability follows. Moreover, early intervention through timely alerts allows for action before further damage is incurred.

Medical loss management is also monetized by the ability to objectively measure claim cost savings. Having projected the ultimate medical costs for a claim, quantifiable cost savings are available at claim closure due to coordinated medical management initiatives. Monetization is realized through client satisfaction, customer loyalty and client retention. Moreover, the story is proof of value serving the organization’s strategic competitive advantage.

See also: Proof of Value for Medical Management  

Organizations that monetize their data have greater returns, including return on investment. The intelligent medical management system is monetized internally and externally, thereby paying for itself. Such statements are familiar as sales platitudes, but with intelligent medical management, positive results are objectively measured. Savings are greater than the cost.

How to Power Down WC Medical Costs

It just makes sense. When an injured worker has an underlying medical condition, recovery is compromised in one way or another. The case will be more complex, and it is likely to have a longer duration, higher severity scores and cost more. A recent article published by Denise Johnson in Claims Journal describes how identifying comorbidities early can help control workers’ comp claim costs.

Johnson identifies common comorbidities to watch for, including obesity, diabetes, hypertension and depression. There are many more, too. For instance, a pregnant injured worker will require careful medical management. Pregnancy should be considered a comorbidity and followed closely. Other examples include HIV, hepatitis C, cardiac disease and chronic pulmonary disease. The important thing is to identify the comorbid conditions in claims so they are monitored carefully and referred to nurse case management early.

See also: 25 Axioms Of Medical Care In The Workers Compensation System  

Comorbid diagnoses can be found in the data—usually. Treating doctors can include the comorbid diagnosis in the list of diagnoses on the bill, but sometimes they do not. They might consider a general health problem irrelevant to a workers’ comp claim, while it might be critical.

Reviewing diagnoses in a claim by the date they were added can be revealing. A diagnosis of diabetes or obesity can appear weeks after the injury date and well into the treatment process. Moreover, when in the course of treatment a diagnosis appears can be enlightening and deserves attention.

Some comorbid diagnoses appear late in the data because they are newly discovered or the treating doctor becomes aware of them later. An example is discovering a diagnosis for a mental disorder in the data long after the actual injury.

A mental disorder diagnosis might result from delayed or unsuccessful recovery as the patient acts out in frustration. Or the late diagnosis might imply previously unrecognized psycho-social factors. Nevertheless, the data should be monitored continually to tag any diagnosis that creeps into the claim picture at any point.

When comorbid or any apparently unrelated diagnoses appear later in a claim, it could be a pre-emptive signal of poor response to treatment or even impending litigation. Monitoring the data continually to uncover new diagnoses is essential to avoid missing subtle issues.

Data can be made smarter by the form and mechanism in which it is presented to those managing the claim. The manner in which diagnostic data is portrayed for claims reps and medical managers can be not only informative, but actionable. An example is portraying all diagnoses by the date they were added to the claim in bills. Such views can disclose subtleties about what is occurring in the treatment process and inform those managing a claim of ensuing problems.

See also: Even More Tips For Building A Workers Compensation Medical Provider “A” Team  

Identifying comorbidities and other troublesome conditions in claims using predictive analytics and continuous data monitoring leads to early intervention and best results. For additional perspectives on this topic, please see, “Analytics-Informed Early Intervention Drives Best Outcomes.”

Research That Predicts Claim Risk

WCRI (Workers’ Compensation Research Institute) recently released a report identifying predictors of injured worker outcomes. While the report reflects only a few states, the information can logically be extrapolated to other areas. When seeking answers in medical management, the issues remain fundamentally constant regardless of location because they are medical, not jurisdictional.

“Better information about the predictors of poorer worker outcomes may allow payors and doctors to better target health care and return-to-work interventions to those at risk,” stated Dr. Richard Victor, WCRI executive director.

Moreover, data systems can search for the predictors in claims so that appropriate attention is focused on them from the beginning, mitigating the damage.

Preventive communication

Having said that, the first predictor of poor outcomes identified in the WCRI study will not be found in the data. WCRI found that, when injured workers are strongly concerned about being fired after the injury, outcomes will be poor. Managing worker understanding is an employer risk management issue, one that can best be handled with good communication.

Contacting injured workers early and continually with reassurances of continued employment will drive best results. Moreover, the approach is easy and costs nothing.

Other risks identified in the study require a different approach.

Comorbidity risk

WCRI research identified three comorbidities of concern: hypertension, heart disease and diabetes. When these comorbidities are combined with a workplace injury, the result is longer durations of disability. Workers with heart disease had disability durations four weeks longer than those without heart disease. Those with hypertension and diabetes exhibited 3% and 4% higher rates of not working three years after their injury.

Comorbidity risk is a generally known truth, gained either logically or through experience. I call it corporate wisdom. The study validates the theory.

Monitor ICD-9s

Search for these and other conditions in claims by monitoring the data continuously. Each condition has a set of ICD-9s (International Classification of Disease) for the disease. ICD-9s appear on medical bills, so a continuous search for them in the bill review or claims systems is reasonable. Moreover, the search can be extended to other comorbidities.

Other risky comorbidities

Other comorbidities have been identified through industry research as complicating injury recovery and generating poorer outcomes. Search Google to find specific diseases or to find a myriad of studies that bear this out. Such studies are proof of the notion that when certain diseases are coupled with workplace injuries, outcomes are poorer, disability durations are longer and costs are higher. Examples of search requests are, “Opioids in Workers’ Compensation” or “Obesity in Workers’ Compensation.”

Use a search engine to find industry studies regarding other comorbidities such as specific mental health conditions like stress or depression. The research provides an argument for actively managing claims where the comorbidities exist.

Opportunity gain

Industry research is invaluable. Leverage the work of serious researchers rather than engaging in pricy statistical modeling. Statistical modeling uses advanced mathematical methods to identify high risk claims. Still, an affordable alternative method is available.

Customize for the organization

To learn the comorbidities of most concern to an organization, do a query of the highest-cost claims in the data over the past few years. List the diagnoses in those claims and identify the comorbidities most commonly associated with them. Then look for industry research on those diagnoses to establish rationale for implementing the monitoring and intervention procedures.

‘Coattail’ to predict

If statistical modeling is not within practical reach, “coattailing” on industry research is a viable alternative. Determine the highest-risk comorbidities within the organization, search the research and begin monitoring the data to find claims where they occur.

Monitoring the data allows for a proactive approach by tagging claims at risk soon after injury, thereby modulating the damage.

Plan of action

Establish standard medical management processes for responding when identified comorbidities or other high-risk diagnoses appear in a claim. Identifying claims that portend risk, whether from comorbidities or anything else, is a cost-savings measure only if an action plan is in place for responding to it. Gaining the information is nice, but it must be tied to an intervention plan to make a difference.

Because these are medical situations, automatic referral to a medical case manager makes the most sense. An organization should establish protocols and procedures for approved intervention. Appropriate attention focused from the beginning will abate the damage, thereby improving outcomes.

Workers’ Compensation Comes of Age

With close to $40 billion in net written premium, the workers’ compensation line of business is an important driver of financial success for many property/casualty insurers. It has come a long way since its inception roughly 100 years ago. 

As we move forward into the second century of workers’ compensation, it’s possible to anticipate many of the challenges (and opportunities) that are coming. What follows is a checklist of areas to watch.

CLAIMS FREQUENCY—Many aspects of the U.S. economy should help keep claims frequency flat or negative in the near future, including:

An increasing underground economy

In April, Mark Koba, a senior editor at CNBC, chronicled the growth of a large shadow economy of workers who, because they are unable to find regular employment, are taking jobs under the table with no reportable income or taxes. Since these workers have no workers’ compensation insurance protection, medical costs may shift from the workers’ compensation system to the health care system. With some estimates showing construction employment at just 75 percent of 2007 levels, it’s possible that a portion of these jobs are being filled by under-the-table workers. If that’s the case, these traditional higher-frequency classes may not show up as heavily in the industry’s calculations as they have in the past—moderating frequency trends going forward.

Growth in Social Security disability payments

Also in April, CNN Money reported a 29% increase in the number of Americans with little or no employment income who receive disability payments. For those who were formerly employed, the increase was a staggering 44%. In 2011, according to the CNN report, the federal government spent almost $250 billion on disability payments to some 23 million Americans. Although this is a ballooning liability for the federal government, the impact on workers’ compensation insurers is largely in the opposite direction. As workers who are less than healthy exit the workforce, the remaining pool of healthier workers will lead to claims frequency decreases in the future.

Expansion of other state and federal backstops

Since the recession began, there’s been a dramatic increase in federal and state assistance. A March article that appeared on the MoneyNews website reported that the number of food stamp recipients reached a record high in 2012, with an average of 46.6 million people receiving food stamp benefits each month. According to Supplemental Nutrition Assistance Program (SNAP) data, total food stamp benefits increased from $30.4 billion in 2007 to $74.6 billion in 2012, a 145% increase. As state unemployment benefits and other backstop programs cover more people for longer periods, the pool of future workers’ compensation claimants likely to file claims shrinks. When individuals leverage government backstop programs and choose not to work, workers’ compensation insurers benefit.

Older workers not retiring

People are working longer. For the manufacturing industries, this most likely means a dramatic reduction in the number of new employees entering the workforce. Although older workers have higher claims severity, new workers have significantly higher claims frequency.

Workplace health and safety efforts

The risk management and environmental, health, and safety departments of companies continue to focus on enhancing return-to-work programs, promoting workplace wellness, and improving workplace safety. These efforts continue to bear fruit, especially as the workforce ages and the adverse impacts of obesity receive more attention.

Part-time to full-time bias on frequency

Workers’ compensation frequency is often calculated as a ratio of the number of lost-time claims per an adjusted payroll amount. To the extent that recent payroll increases have been driven by more part-time workers converting to full-time work, the doubling of exposure for current workers isn’t the same as doubling the number of workers. In the short term, a heavier reliance on existing employees working longer hours very likely will help make frequency statistics look better. This trend could reverse if smaller employers keep their head count under 50 employees or reduce employee hours to part time (under 30 hours) to mitigate the impact of the employer mandate in the Affordable Care Act (ACA). Newly added part-time workers are likely to bring higher claim frequency, while workers taken below the 30-hour threshold to avoid employer-mandated health care might have an increased incentive to shift claims to workers’ compensation.

SEVERITY—A number of coalescing factors could drive medical and indemnity severity higher in the years ahead, including:

Rising interest rates

With the Federal Reserve finally winding down its quantitative easing programs, interest rates will be heading higher. To the degree that this coincides with an improving economy, indemnity severity is likely to tick up with rising wage pressure. Medical severity, which historically has run at roughly double the medical consumer price index, is likely to rise from the 3% levels we are experiencing today. Severity trends in the 6% to 7% range may be manageable in light of today’s rate increases, but it will be difficult to expand profit margins over the long term if medical inflation returns to double-digit levels.

Claims predictive modeling

Companies increasingly are using advanced analytics to identify claims for triage as early as the first notice of loss. By identifying the highest severity claims, assigning the appropriate resources for triage, and doing a better job on referrals from special investigative units, companies are favorably affecting the duration and severity of claims.

Obesity

The obesity statistics are staggering. The Centers for Disease Control and Prevention (CDC) estimates that in 2010, 36% of Americans age 20 or older were obese. The Robert Wood Johnson Foundation in a 2012 report predicted that obesity rates for adults over the next 20 years would reach or exceed 44% in every state in the United States, and exceed 60% in 13 of those states. Recent NCCI studies show that the ratio in the medical costs per claim of obese to nonobese claimants at the end of five years is 5.3, and the duration of obese claimants is five times that of nonobese claimants. Given the fact that workers of all ages are struggling with maintaining a healthy weight, workers’ compensation costs will only increase as other comorbidities associated with obesity increase costs.

An aging workforce

As workers age, gradual changes in hearing, vision, strength, and balance may lead to increased probabilities and durations of workplace injuries, including sprains, strains, slips and falls, carpal tunnel syndrome, knee and shoulder problems, hip replacements, and back issues. A 2012 NCCI study, however, concluded that an aging workforce appears to have far less of a negative impact on workers’ compensation claims costs than was previously thought. Although there’s evidence that injured workers older than 35 years have higher costs than those younger than 35, costs associated with injured worker cohorts older than 35 tend to be quite similar. And while older workers have more costly injuries, the NCCI observed that such injuries are becoming more prominent in younger workers.

While the NCCI has presented conflicting data on the claim costs of older workers, we know that the number of older workers in the workforce will nearly double in the next 15 to 20 years. The U.S. Department of Health and Human Services estimates that the 39.6 million persons age 65 years or older today will increase to roughly 72.1 million by 2030. That equates to roughly one in every five Americans being 65 or older. While the jury is out on the precise impact of an aging workforce on claim frequency and severity, an aging workforce increases the likelihood of more severe injuries and longer claim durations.

LONG-TERM TRENDS—On the plus side, several trends are emerging that could benefit workers’ compensation insurers in the long run, including:

Price transparency

When the Surgery Center of Oklahoma in Oklahoma City started posting its prices online four years ago, it forced competing area hospitals to follow suit. Although it will take time to catch hold across the country, greater price transparency in the delivery of health care could benefit workers’ compensation insurers. Running counter to this trend is the pace of consolidation in health care. The ACA, with its focus on accountable care organizations (ACOs), electronic medical records, and other coordination-of-care rewards, is fueling consolidation in health care at an unprecedented rate. With increased consolidation comes increased local pricing power, and workers’ compensation insurers could find themselves on the wrong end of that pricing pendulum.

Opioid use

The epidemic of opioid abuse that had swept the nation is finally starting to abate. State governors, attorneys general, and legislatures are passing laws to toughen criminal and administrative penalties for doctors and clinics, establishing standards of care for doctors who prescribe narcotics, increasing the reporting and tracking of prescriptions, and limiting reimbursements to physicians who dispense prescription drugs to no more than a certain percentage above cost. State agencies, local agencies, and the U.S. Drug Enforcement Administration also are aggressively prosecuting individuals involved in illegal prescribing activity and “pill mills,” causing physicians, nurse practitioners, and pharmacies to surrender their federal licenses to dispense controlled substances. In the most serious cases, the offenders have had to surrender their medical licenses to state medical/pharmacy boards. Physicians and medical boards also have developed resources to guide physicians on responsible opioid prescribing, and there’s been a rise in the number of physicians who have had their licenses suspended by state medical boards for the unlawful distribution of controlled substances and for prescription drug fraud. Organizations like the Federation of State Medical Boards and Physicians for Responsible Opioid Prescribing also have joined the fight.

Given the high-profile nature of these efforts to define the proper use of opioids in treating injured workers, it’s likely the workers’ compensation line will see an effect. With medical expenses exceeding 60% of workers’ compensation costs, 20% of that going toward prescription drugs, this would be a welcome development.

Medical tourism

Medical tourism continues to grow as an option for patients all across America. An airline magazine recently had advertisements from hospitals outside the United States showing savings of 50% to 80% on procedures such as knee and hip replacements that are common in workers’ compensation. The general cost in the United States for a knee replacement was shown at $34,000, versus the overseas cost of just $10,000. A hip replacement was listed as $35,000 versus the overseas cost of just $11,000. Even with the cost of airfare, transportation, and hotel accommodations, the potential savings are significant (acknowledging that we aren’t attempting to control for quality or safety differences). With several companies and health insurers investigating offering medical tourism options to their employees and insureds, there could come a day when workers’ compensation insurers could leverage these tremendous savings to help drive down severity for certain procedures. While businesses may welcome the cost savings, we recognize that persuading state legislatures and injured workers to agree to these practices could be difficult.

The ACA

Several economist and workers’ compensation industry stakeholders have predicted that the ACA will create shifts in the workers’ compensation industry. But exactly how isn’t clear. Many refer to the Massachusetts Health Care Reform Act to bolster the argument that the ACA will lower overall health care costs and workers’ compensation costs. Under Massachusetts health care reform, costs within the workers’ compensation system decreased. Although ACA is more complex, similar provisions in the two laws allow a comparison of the impact on the workers’ compensation system. Analysis by RAND in 2012 found that expanding coverage to previously uninsured individuals resulted in a drop in workers’ compensation costs in Massachusetts. Finding an association between being insured and the frequency of workers’ compensation claims, RAND concluded that expanding the population holding group health insurance could reduce cost shifting to workers’ compensation.

In a May blog posting, Joe Paduda, a principal at Health Strategy Associates, affirmed his belief that the overall effect of the ACA on workers’ compensation would be positive, citing among other things, that it would lessen the motivation for cost shifting and fraudulent claims. Others have argued that increasing access to care and expanding preventive services, coupled with employer-sponsored wellness initiatives, should make the working population healthier overall, leading to a reduction in claim frequency and faster recoveries when injuries do occur.

On the other hand, some speculate that the ACA will increase workers’ compensation costs over time by straining already scarce primary care resources and causing longer wait times for treatment. The projected shortage of primary care physicians could make it more difficult for injured workers to find a physician. This, in turn, could lead to increased costs because of extended disability durations while waiting to see a physician. Others have pointed out that a decreasing supply of physicians and increasing patient demand could drive costs higher. Other factors that could affect cost shifting are significant increases in copayments and high-deductible health plans—costs that employees must bear. This could motivate some employees to file workers’ compensation claims for nonoccupational injuries.

According to findings from a recent study by Assured Research, a connection between increased health insurance coverage and decreased workers’ compensation costs isn’t supported by the data. The study evaluated health insurance penetration rates by state from 1999 to 2011 and corresponding statewide workers’ compensation loss ratios. After adjusting for national workers’ compensation trends, the results showed 31 states with rising health care penetration that resulted in decreased loss ratios. On the other hand, 20 states with rising health care penetration experienced increased loss ratios.

Immigration reform

There are approximately 11 million undocumented people living in the United States. Many don’t file workers’ compensation claims for fear of being deported. The general consensus is that legalizing undocumented immigrants will increase workers’ compensation claims. At the same time, immigrant workers are more prevalent in high-risk sectors such as agriculture, construction, and landscaping. With an influx of workers into a high-risk injury class, the potential impact on frequency and severity in the workers’ compensation system can’t be overlooked.

Anticipate and Plan

British Prime Minister Benjamin Disraeli once quipped, “What we anticipate seldom occurs, what we least expect generally happens.” Still, it’s important to anticipate and plan for the future risk. There’s little doubt that change is looming for workers’ compensation insurers and that actuaries have a key role to play in identifying and managing the transformation.

Authors

Denise Gillen-Algire and Kevin Bingham collaborated with Bill Van Dyke and William Wilt in writing this article.

Bill Van Dyke, an associate of the Casualty Actuarial Society and a member of the Academy, is a specialist leader at Deloitte Consulting LLP in Hartford, Conn. He has extensive actuarial experience in managing and performing workers’ compensation unpaid claim reserve and pricing analyses for state funds, insurers, reinsurers, state agencies, municipalities, self-insured corporations, and captives.

William Wilt, a fellow of the Casualty Actuarial Society, is president of Assured Research, a research and advisory firm focused on property/casualty insurance. Prior to forming Assured, he held diverse roles as an actuary, as a credit and equity analyst, and in corporate development.

This article first appeared in the November | December 2013 issue of Contingencies Magazine and is © 2013 American Academy of Actuaries. Reprinted with the permission of the American Academy of Actuaries.  All Rights Reserved.

New AMA Classification Of Obesity: How It Affects Workers’ Compensation And Mandatory Reporting

On June 16, 2013, the American Medical Association voted to declare obesity a disease rather than a comorbidity factor. This change in classification will affect 78 million American Adults and 12 million children. The new status for obesity means that this is now considered a medical condition that requires treatment. In fact, a recent Duke University / RTI International / Centers for Disease Control and Prevention study estimates 42 percent of U.S. adults will become obese by 2030.

According to the Medical Dictionary, obesity has been defined as a weight at least 20% above the weight corresponding to the lowest death rate for individuals of a specific height, gender, and age (ideal weight). Twenty to forty percent over ideal weight is considered mildly obese; 40-100% over ideal weight is considered moderately obese; and 100% over ideal weight is considered severely, or morbidly, obese. More recent guidelines for obesity use a measurement called BMI (body mass index) which is the individual's weight divided by their height squared times 703. BMI over 30 is considered obese.

The World Health Organization further classifies BMIs of 30.00 or higher into one of three classes of obesity:

  • Obese class I = 30.00 to 34.99
  • Obese class II = 35.00 to 39.99
  • Obese class III = 40.00 or higher

People in obese class III are considered morbidly obese. According to a 2012 Gallup Poll, 3.6% of Americans were morbidly obese in 2012.

The decision to reclassify obesity gives doctors a greater obligation to discuss with patients their weight problem and how it's affecting their health while enabling them to get reimbursed to do so.

According to the Duke University study, obesity increases the healing times of fractures, strains and sprains, and complicates surgery. According to another Duke University study that looked at the records for work-related injuries:

  • Obese workers filed twice as many comp claims.
  • Obese workers had seven times higher medical costs.
  • Obese workers lost 13 times more days of work.
  • Body parts most prone to injury for obese individuals included lower extremities, wrists or hands, and the back. Most common injuries were slips and falls, and lifting.

The U.S. Department of Health and Human Services said the costs to U.S. businesses related to obesity exceed $13 billion each year.

Furthermore, a 2011 Gallup survey found that obese employees account for a disproportionately high number of missed workdays. Also earlier National Council on Compensation Insurance (NCCI) research of workers' compensation claims found that claimants with a comorbidity code indicating obesity experience medical costs that are a multiple of what is observed for comparable non-obese claimants. The NCCI study demonstrated that claimants with a comorbidity factor indicating obesity had five times longer indemnity duration than claimants that were not identified as obese.

Prior to June 16, 2013, the ICD code for comorbidity factors for obesity in workers' was ICD-9 code 278. This is related to obesity-related medical complications, as opposed to the condition of obesity. Now the new ICD codes will indicate a disease, or condition of obesity which needs to be medically addressed. How will this affect work-related injuries?

Instead of obesity being a comorbitity issue, it can now become a secondary claim. If injured workers gain weight due to medications they are placed on as a result of their work-related injury or if an injured worker gains weight since they cannot exercise or keep fit because of their work-related injury and their BMI exceeds 30, they are considered obese and are eligible for medical industrially related treatment. In fact, the American Disability Act Amendment of 2008 allows for a broader scope of protection and the classification of obesity as a disease means that an employer needs to be cognizant that if someone has been treated for this disease for over 6 months then they would be considered protected under the American Disability Act Amendment.

Consider yet another factor: with the advent of Mandatory Reporting (January 1, 2011) by CMS that is triggered by the diagnosis (diagnosis code), the new medical condition of obesity will further make the responsible party liable for this condition and all related conditions for work-related injuries and General Liability claims with no statute of limitations. It is vital to understand that, as of January 1, 2011, Medicare has mandated all work-related and general liability injuries be reported to CMS in an electronic format. This means that CMS has the mechanism to look back and identify work comp related medical care payments made by Medicare. This is a retroactive statute and ultimately, it will be the employer and/or insurance carrier that will be held accountable.

The carrier or employer could pay the future medical cost twice — once to the claimant at settlement and later when Medicare seeks reimbursement of the medical care they paid on behalf of the claimant. This is outside the MSA criteria. The cost of this plus the impact of the workers' compensation costs as well as ADAA issues for reclassification of obesity for an employer and carrier are incalculable.

The solution is baseline testing so that only claims that arise out of the course and scope of employment (AOECOE) are accepted. If a work-related claim is not AOECOE and can be proved by objective medical evidence such as a pre- and post-assessment and there is no change from the baseline, then not only is there no workers' compensation claim, there is no OSHA-recordable claim, and no mandatory reporting issue.

A proven example of a baseline test for musculoskeletal disorders (MSD) cases is the EFA-STM program. EFA-STM Program begins by providing baseline injury testing for existing employees and new hires. The data is only interpreted when and if there is a soft tissue claim. After a claim, the injured worker is required to undergo the post-loss testing. The subsequent comparison objectively demonstrates whether or not an acute injury exists. If there is a change from the baseline site specific treatment, recommendations are made for the AOECOE condition ensuring that the injured worker receives the best care possible.

Baseline programs such as the EFA-STM ensure that the employee and employer are protected and take the sting out of the new classification by the AMA for obesity.