The Lack of Equality in the CMS Reimbursement Policy

The current debate on national health care has brought to the forefront some of the most glaring problems that are compounding the workers’ compensation medical delivery system. Since the enactment of The Medicare Secondary Payer Act (MSP) in 1980, the Federal Government has desperately tried to prevent cost shifting from the workers’ compensation system to the Federal Medicare program. The efforts of The Centers for Medicare and Medicaid Service (CMS) to seek medical reimbursement of past and future medical care costs from workers’ compensation beneficiaries, in a uniform fashion across the entire national spectrum, is plagued with equality issues.

In a very insightful article, Robert Pear of The New York Times on June 9, 2009 reported that costs of medical care were not uniform through out the nation and that an increase in expenditures for treatment did not improve the outcome. These “disparities,” as Pear points out demonstrate major fluctuations in the cost of Medicare payments for the same types of treatment. “Nationally, according to the Dartmouth Atlas of Health Care, Medicare spent an average of $8,304 per beneficiary in 2006. Among states, New York was tops, at $9,564, and Hawaii was lowest, at $5,311.”

The costs for medical care paid by Medicare based upon geographical jurisdictions are unequal. More specifically, higher costs states were reported to be: Florida, Massachusetts, New Jersey and New York. The lower cost states were reported as: Iowa, Minnesota, Montana, North Dakota, Oregon and Washington.

CMS has sought to seek reimbursement under the MSP Act for medical care, present and future, based on a nationally tailored program. Unfortunately, the benefits paid by each state program are not the same.

While the program to deter the shift of billions of dollars Medicare funds yearly to pay for work related injuries and disease is a noble goal and legitimate function, it is now unequally applied to beneficiaries across the country since all workers’ compensation benefit programs are not the same and the costs of medical treatment vary.

The need for uniformity and equality should be address by Congress as it debates the future of medical care legislation. The enactment of a single payer medical care system would be a good first step to leveling the playing field for both employers and employees.

Soldiers Exposed to Chromium in Iraq File Suit

Soldiers who have been exposed to hexavalent chromium, a carcinogen, have filed suit against a government contractor. The present and former soldiers have brought a claims against KBR (Kellogg, Brown & Root), a subsidiary of Halliburton, for concealing the contamination and knowingly exposing them to potential harm. The chromium chemical, sodium dichromate, was utilized to prevent corrosion.

The Oregon legislature has held hearings on pending legislation to assist the ill soldiers. One Oregon soldier has died of complications of leukemia at the age of 21.

Fixing The Broken Health Care System

This week President Obama reached out to Labor and Industry, employers and employees and Congress and the voters, in an effort to increase the momentum for repairing the medical delivery system. The problems are universal and the remedies will need to be global.

In his weekly address to the nation The President said, "Simply put, the status quo is broken. We cannot continue this way. If we do nothing, everyone’s health care will be put in jeopardy. Within a decade, we’ll spend one dollar out of every five we earn on health care – and we’ll keep getting less for our money." Furthermore, "That’s why fixing what’s wrong with our health care system is no longer a luxury we hope to achieve – it’s a necessity we cannot postpone any longer."

The delivery of adequate medical benefits is a metastatic problem that goes to the very heart of the ability of the network of State workers' compensation system to operate. The costs of the delivery, co-ordination and administration of benefits continue to strangle the system into growing stagnation.

In a noble experiment the State of NJ, in response to critical reports, has proposed new regulations to establish an administrative system to expedite "emergent" medical benefits if an "irreparable harm" can be established. The irony is that the standard and requirement is so stringent, that imminent death does not even meet the standard.

The workers' compensation system was enacted in 1911, when the path was simple and short to provide medical care to "relieve and cure." The complexities that developed into the highway of benefits, has brought the major vehicle producers into bankruptcy, ie. Chrysler and General Motors. New vehicles will now need to be manufactured to meet the new needs of today and tomorrow.

It is time that Congress looks toward the workers' compensation system to develop a new vehicle to provide innovative approaches for a better medical delivery system for injured workers. A single medical care program that provides universal medical care would be a wise and appropriate route for America.

Florida Governor Signs Bill Limiting Counsel Fees

The Governor of Florida has signed yet another law limiting counsel fees in workers' compensation actions. The original law was declared unconstitutional by the Florida Supreme Court.

The new law provides for capped limits as follows:

"(1)  A fee, gratuity, or other consideration may not be

15 paid for a claimant in connection with any proceedings arising

16 under this chapter, unless approved as reasonable by the judge

17 of compensation claims or court having jurisdiction over such

18 proceedings. Any attorney's fee approved by a judge of

19 compensation claims for benefits secured on behalf of a claimant

20 must equal to 20 percent of the first $5,000 of the amount of

21 the benefits secured, 15 percent of the next $5,000 of the

22 amount of the benefits secured, 10 percent of the remaining

23 amount of the benefits secured to be provided during the first

24 10 years after the date the claim is filed, and 5 percent of the

25 benefits secured after 10 years. The judge of compensation

26 claims shall not approve a compensation order, a joint

27 stipulation for lump-sum settlement, a stipulation or agreement

28 between a claimant and his or her attorney, or any other

29 agreement related to benefits under this chapter which that

30 provides for an attorney's fee in excess of the amount permitted

31 by this section. The judge of compensation claims is not

32 required to approve any retainer agreement between the claimant

33 and his or her attorney. The retainer agreement as to fees and

34 costs may not be for compensation in excess of the amount

35 allowed under this subsection or subsection (7) section."

"(3)  If any party should prevail in any proceedings before

63 a judge of compensation claims or court, there shall be taxed

64 against the nonprevailing party the reasonable costs of such

65 proceedings, not to include attorney's fees."

"  (7)  If an attorney's fee is owed under paragraph (3)(a),

107 the judge of compensation claims may approve an alternative

108 attorney's fee not to exceed $1,500 only once per accident,

109 based on a maximum hourly rate of $150 per hour, if the judge of

110 compensation claims expressly finds that the attorney's fee

111 amount provided for in subsection (1), based on benefits

112 secured, fails to fairly compensate the attorney for disputed

113 medical-only claims as provided in paragraph (3)(a) and the

114 circumstances of the particular case warrant such action."

Proposed North Carolina Legislation Caps Benefits for Seniors

Proposed legislation in North Carolina seeks to cap workers compensation benefits for those over the age of 65 years old. HR1022. The legislation specifically states: " Temporary total disability compensation shall continue for a period lasting until the longer of (i) when the injured employee is eligible by age for full benefits under the Social Security Act, 42 U.S.C. § 401, et seq., or (ii) a period of 300 weeks from the date of injury."

If passed, the legislation would be more limiting than "reverse offset" language enacted pre-1980 by several states and would follow a recently enacted legislation in Utah to limit benefits for the aged which was declared unconstitutional.

Opposition Mounts to a National Study Commission

Special interest groups are mounting opposition to the formation of a national study commission on workers' compensation. The PIA (The National Association of Professional Insurance Agents).

“This is a typical Washington D.C. approach: appoint a commission, give it a big budget and create a big new bureaucracy,” said PIA National Government Affairs Committee Chairman Johnny Lee. “The fact is, none of this is necessary. Workers’ compensation programs are regulated by the states, not the federal government. The federal government should not seek to interfere in a state-based and state-regulated system. This is a waste of time and taxpayers dollars.”

Chrysler Workers' Compensation Fund Challeged by Illinois Attorney General

Illinois Attorney General Lisa Madigan filed an objection to the company's pending sale to Fiat. She indicated that the the Illinois Workers’ Compensation Commission (IWCC) and the Illinois Self-Insurers Advisory Board (ISIAB) were at risk with if the pending sale goes through.

“In filing this motion, we are working to protect the safety net for Chrysler employees and ensure that sufficient funds are available to pay for any potential workers’ compensation claims,” Madigan said.