by Christopher R. Brigham, MD
An understanding of the effectiveness of impairment rating
screening and the performance of selected reviews is gained
by reviewing the experience of a California client who
initiated a policy in 2007 where all AMA Guides
impairment ratings (including 0% ratings) were reviewed. If
the rating was 5% whole person permanent impairment (WPI) or
less, only a screen was performed; if the rating was more
than 20%, a detailed critique was provided. A detailed
critique was also provided if there was a difference of more
than 2% WPI between the original rating and the corrected
rating. This program was initiated with recognition of the
high error rate among rating physicians and difficulties by
claims and legal staff in consistently identifying erroneous
ratings.
Based on the review for this client of all ratings
(including 0% WPI ratings), 57% of the reports were found to
be incorrect, with the average original rating of all
reports being 8% WPI and upon correction 5% WPI. Of the
erroneous ratings, 89% were overrated. The nature of errors
is that it is more likely to overrate then underrate. Each
impairment rating was converted to a permanent disability
rating per the California Permanent Disability Rating
Schedule; the average dollar difference was $4,730
(reflecting net adjustments for both overrated and
underrated reports) and the average cost of the review
service was $412; this reflected an opportunity of an 11.4
return on investment. The fee for an Impairment Screen is a
nominal $95 if the rating is determined to be correct and
$195 if it is incorrect; these charges reflect a cost which
is a small fraction of the dollar amount associated with a
difference of 1% WPI. The fee for a detailed critique report
is dependent on the time involved in performing the review
and preparing the report. The reported experience was that
the majority of the time physicians would correct their
ratings based on our feedback or that this information was
useful in negotiation or case resolution. Therefore, the
review service was very cost-effective.
If the original rating is 3% WPI or less, it is highly
probable that the rating is correct. 34% of the original
ratings were 3% whole person permanent impairment or less;
95% of these ratings were correct (with the exception of a
shoulder case rated at 0% WPI and re-rated at 5% WPI). Of
the ratings more than 3% WPI, 82.5% were incorrect, with the
average original rating 12% WPI and upon correction 5% WPI.
After conversion to Permanent Disability this reflects an
average dollar difference of $7330 and average cost of
review of $574; this reflects an opportunity of a 12.8
return on investment. In terms of review fees, 40% of these
were impairment screens ($95 if correct and $195 if
incorrect) and 60% were detailed reports (averaging $855).
Therefore, assuming a similar profile of cases, per 100
cases it is probable that approximately 1/3 (34) of the
cases will be less than 3% whole person permanent impairment
and the vast majority of these ratings will be correct. Of
the remaining 66 cases rated as 3% whole person permanent
impairment or greater, it is projected 12 will be correct,
15 will be incorrect with a difference equal to or less than
3% whole person permanent impairment, and 39 will be
incorrect with a difference greater than 3% whole person
permanent impairment. The projected total cost per 100
cases, with only those cases of 3% whole person permanent
impairment or greater is $37,315, and projected savings is
$483,780 (based on the difference of $7330 for 66% of the
cases); this reflects a potential return on investment of
13:1. Although the screening of reports with 3% WPI or less
is less likely to identify errors, it does create a more
valid database of impairment ratings for specific diagnoses
and assists in profiling physicians. Therefore it is
recommended that all ratings be reviewed. The increased cost
of reviewing all ratings (assuming 95% of the cases of 3%
WPI or less are correct) is an additional $3330 reflecting a
total of $40,645 and a slight reduction in the immediate ROI
to 11.9. It is our opinion that the value obtained in having
an inclusive database of all ratings supports reviewing all
ratings.
Routine expert review of all impairment ratings is highly
recommended. The reviewers should have years of experience
in the use of the Guides, clinical expertise, and
resources to collect and analyze data. The goal is to assure
accurate, unbiased ratings.
_______________________
Impairment Rating Integrated Solution - IRIS
The best practices and most cost-effective claims
management approach to impairment ratings is our Impairment
Rating Integrated Solution (IRIS), which includes low cost
screen of all ratings (Impairment
Screen), detailed critique of erroneous ratings (Impairment
Review),
Impairment Profiling System data analysis (your
cases and overall data, including impairments for specific
diagnoses and physician profiling), and access to
GuidesIQ.
The fee for this solution is nominal; for most impairment
screens the cost is only $95 if the rating is correct or
$195 if incorrect - a fraction of the cost of even a single
percentage error. The fee for detailed critiques is based on
the time involved for that case. We will develop with you a
process that is most effective for your organization.
Ratings are reviewed typically within five days and invoices
are sent for each case. The fee for the professional service
is typically billed to the file. *If we review all of
your ratings, we provide you on a complimentary basis
our data analysis (otherwise quarterly licensing fee of
$9500) and also access to GuidesIQ for your staff (otherwise
annual membership fee of $897 per person). You also receive
priority status. Most importantly you have a cost-effective
mechanism to assure accurate impairment ratings.
We recommend a three month trial with this intervention. At
the end of that time you assess the impact of this strategy
and determine whether to continue and if any modifications
are needed. Every client implementing this has continued
with the screens and the return on investment has been
several-fold. Contact
Mindy Brigham today and solve the challenge of erroneous
impairment ratings.
_______________________
Effects of Treatment
by Leslie Dilbeck, WCCP, CIR
The Guides offer the following discussion for this
impairment rating (5th ed., 20):
- In certain instances, the treatment of an illness may
result in apparently total remission of the person's signs
and symptoms. Examples include the treatment of
hypothyroidism with levothyroxine and the treatment of type
1 diabetes mellitus with insulin. Yet it is debatable
whether, with treatment, the patient has actually regained
the previous status of normal good health. In these
instances, the physician may choose to increase the
impairment estimate by a small percentage (eg, 1% to 3%).
How often is this adjustment appropriate?
Very rarely. This adjustment was designed primarily for
internal medicine cases, yet 95% of all impairment ratings
are musculoskeletal.
When do you recall last reviewing a report where there
was an impairment rating for endocrine disease?
Prior to the use of the AMA Guides in California we
do not recall reviewing any cases in which this adjustment
was made, and we review thousands of cases per year.
However, recently we have seen many cases where physicians
have been encouraged by applicant attorneys to apply this
adjustment.
What are the requirements for applying this adjustment?
- First, the examinee needs to be asymptomatic and without
objective findings as a result of medications or treatment
program (i.e. "total remission of the person's signs and
symptoms").
- Second, if treatment was discontinued, to a reasonable
degree of medical certainty the examinee would manifest
signs or symptoms.
- Third, ongoing (i.e. permanent) treatment is required.
For example, the use analgesics or non-steroidal
anti-inflammatory agents would not meet this definition.
Why?
Typically examinees are not totally asymptomatic, they may
still manifest findings, and it is doubtful the use of the
medications will be lifetime in duration. If applied the
physician should explain the rationale and why a specific
impairment (1%, 2% or 3% was selected.) Increasing ratings
for "Effects of Treatment" may suggest a rating performed by
a physician inexperienced in the use of the Guides
and/or biased.
Due to these types of errors all impairment ratings should
be reviewed by an expert with several years experience in
the use of the Guides.
_______________________
Upcoming Events
Please feel free to email me or just stop by if you will be
there so that we may touch base. It's always great to meet
with our clients face to face. Look forward to seeing you! -
Mindy Brigham
July 18 - 19, 2007
SEAK National Workers'
Compensation & Occupational Medicine Conference
Four Points by Sheraton Hyannis Resort,
Cape Cod,
MA
July 31 - Aug 2, 2007
9th Annual Workers'
Compensation Conference
Capital Hilton,
Washington DC
October 3 - 6, 2007
WOEMA - Western
Occupational Health Conference
Loews Coronado Bay
Resort,
Coronado, CA
November 6 - 7, 2007
National Workers'
Compensation and Disability Expo
McCormick Place,
Chicago, IL
