Workers’ Compensation Independent Medical Review Volume Continuing to Grow in California

by | Published on Mar 22, 2017 | Medical Review Services

For most insurance carriers, workers’ compensation claims processing require fast and accurate medical record retrieval. Medical records are the basis for determining whether a particular medical service/treatment is medically necessary and therefore reimbursable. It is vital that the medical records are reliable and maintained well. Every time a workers’ compensation claimant sees a physician, physical therapist or other medical provider to treat a workplace injury, the medical records will be used to document the diagnosis, treatment plan, and recovery process.

The California workers’ compensation system uses the independent medical review process or IMR to resolve any dispute about the medical treatment of injured employees. This is with a view to avoid the hassles and expense associated with the court system. The cost of an independent medical review is based on the nature of the medical treatment dispute and the number of medical professionals involved in the resolution of the dispute. This cost is much lower than the cost to resolve such a dispute via litigation.

A request for medical treatment by an employee must go through a utilization review process to determine its medical necessity before it is approved. If the utilization review delays, denies or modifies a treating physician’s request for medical treatment because the treatment is not medically necessary, the injured employee can request a review of that decision through IMR. The cost of the IMR is paid by employers who are required by law to make available all medical treatment that is necessary and reasonable to employees to cure or relieve the effects of a work-related injury. The Division of Workers’ Compensation contracts with one or more independent medical review organizations (IMROs) to conduct the review on its behalf. It is here that medical review services become invaluable for IMROs.

According to a new report from the California Workers’ Compensation Institute (CWCI), in 2016 IMR physicians once again upheld about 90% of utilization review physicians’ modifications or denials of treatment; even so, the IMR volume increased by 6.5%. This analysis is on the basis of a review of data from 477,045 IMR decision letters issued in 2014, 2015 and 2016 as response to applications submitted to the state after a utilization review physician denied or modified a requested medical service.

When IMR was introduced, it was expected to reduce workers’ compensation treatment disputes once doctors, attorneys and other associated persons understood which services could be approved on the basis of evidence-based medicine standards. However, the IMR volume is still very high according to the Division of Workers’ Compensation reports – i.e. 10,477 more cases in 2016 than in 2015.

Here are the major findings of the CWCI:

  • IMR physicians upheld the UR (utilization review) doctor’s denial/modification of a requested service 91.2% if the time ( increase from an 88.4% uphold rate in 2015, and matched the rate noted in 2014).
  • Prescription drug requests (28.5% was for opioids) again accounted for nearly half of all IMRs, with UR denials/modifications of pharmaceutical requests endorsed 92.5% of the time.
  • The requests for compounded drugs represented a declining share of the 2016 prescription drug IMRs. They fell from an 8.0% of the 2015 determinations to 6.2 percent in 2016. This may be due to their consistently low IMR overturn rate.
  • Requests for physical therapy, durable medical equipment (DME) and injections together constituted 24% of the 2016 IMRs. No other medical service type accounted for more than five percent of the disputed requests.
  • Among the medical services, a 78.9% uphold rate was observed for evaluation and management services (mainly referrals for consultations), and 93.6% for acupuncture.
  • Most of the disputed medical services that went through IMR in 2016 were requested by a small number of physicians, just as in 2014 and 2015.
  • The top 10% of the physicians named in the 2016 IMR letters comprised 85% of the disputed service requests whereas the top 1% comprised 44%.
  • More than 32.8% of the IMR decision letters were addressed to Los Angeles County recipients though this region accounted for only 23.6% of all workers’ compensation medical services in California.
  • The IMR volume was excessively high in the Bay Area that accounted for 20.1% of the IMR letters vs. 15% of the medical services. Less populated regions of the state had an inexplicably small share of the IMRs as did Orange County, San Diego and the Inland Empire.

The Department of Industrial Relations (DIR) and the DWC say that IMR is working as intended and that there is an effective process to support medically necessary services and stop inappropriate care. Their data highlights the areas where further improvements are needed especially regarding medical treatment guidelines and education. With this data, they will continue to make adjustments and enhancements to the program with a view to improve evidence-based medical decisions and outcomes for injured workers.

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