There is one element of human behavior that is not very well appreciated by most people — for the most part, socialized humans follow the law.
However, people acting completely rationally will also take advantage of the law. They will not break the law, but nearly all of us will push the boundaries to accomplish our missions.
We do this every day driving our cars. We exceed the speed limit all over the place — maybe not by much; as we know, police officers are rather tolerant of someone going five miles per hour over the limit and much less tolerant of someone going ten over.
Part of this behavior stems from the fact that, with very little exception, laws, rules and regulations are restrictive — they tell us what we can’t do but don’t tell us what we can do. For the most part, this is because it is really very hard to determine what will be allowed — it’s much easier to describe what won’t be allowed.
When we combine law-abiding people who want to get their job done along with restrictive laws, we end up with what are commonly known as loopholes.
Loopholes exist because someone who needs to get something accomplished found a way to do so regardless of some proscription.
Take California’s independent medical review (IMR). IMR was conceived to expedite medical decisions outside of the court system. (Whether this mission is accomplished is the subject of much debate — and is not the subject of this post.) But IMR has produced an unintended consequence that arises from people doing their jobs, and doing the job well, within the constricts of the law.
There is a faction of the workers’ compensation industry whose job is to minimize ultimate claims costs. These are good, law-abiding, citizens. They follow the law … carefully and considerately.
What they have discovered is that an IMR denial of treatment is a final determination, and a final denial of treatment within the workers’ compensation context means that item can be removed from consideration when establishing a Medicare Set-Aside trust. In other words, something that a workers’ compensation payer would have been liable for before IMR is no longer a continuing liability to either the injured worker or to the federal government.
This also means that the cost of treatment is shifted from worker’s comp to Medicare.
Although this may be perfectly legal, and certainly even prudent from the workers’ compensation payer’s viewpoint, my bet is that this was not intended by the authors of SB 863, nor any other medical treatment limitation law in any other state.
The unintended consequence challenges the future of workers’ compensation. The purpose of workers’ compensation, as we have said time and time again, is to make it affordable for an employer to take care of injured workers.
We all get that. But I think we forget a fundamental concept: The obligation is the employer’s.
We don’t fulfill this mission when we shift the responsibility to someone else, such as the federal government via Medicare or Social Security.
Doing so, regardless of legality, invites scrutiny. And when there’s enough scrutiny there’s inquisition. And when there’s enough inquisition, there’s interference.
We’re on the cusp of that now. The public image of workers’ compensation couldn’t be lower. There are many talking about skimpy benefits, of wrongfully denied medical treatment, of passing the buck and of otherwise shirking responsibility.
These are acts that are, for the most part, the product of people working within the law to accomplish their missions and jobs without regard or even an idea of negative consequences.
This is now playing out with California IMR.
California IMR has been under attack since inception. The California Third District Court of Appeals, in Ramirez v. WCAB (SCIF), No. C078440, has granted review to test its constitutionality. Ramirez joins a case already pending at the 1st DCA, Stevens v. WCAB (Outspoken Entertainment), No. A143043, which also seeks to have IMR declared invalid. The basis of these cases is that fundamental rights of due process are violated because there is no legal review process.
Perhaps those challenging IMR have an argument. And just because someone is acting within the bounds of the law doesn’t make that action right, correct or good policy.
When OSHA released its recapitulation of prior research on the adequacy of workers’ compensation, it was seen by many as overreaching based on faulty research. Maybe, but this industry should be fearful, because OSHA’s report is, in reality, the dog barking because someone is intruding on its property and territory. It may not be trespassing, and there may be invitation, but the dog doesn’t know that and doesn’t care.
Eventually, the dog will bite. The states won’t like that at all.