Workers’ Compensation is for work related illness or injuries on the job. The employer pays for insurance which covers medical costs incurred, and replaces lost wages. Fees are based on a specific fee schedule that varies by state.
There are three possible scenarios regarding workers’ compensation: the patient is covered by a WC carrier located in your own state, the patient is covered by a WC carrier located in another state, or the patient is covered by Federal Workers’ Compensation. The following information pertains to state based workers’ compensation claims. Please note that Federal Workers’ Compensation has very specific requirements. See the “Federal Workers’ Compensation” segment later in this chapter for more information.
Work-Related Illness or Injury
Employers pay the cost of the Workers’ Compensation program. This program covers all medical costs incurred, and replaces wages lost as a result of a work related illness or injury. In addition, many states cover rehabilitation and retraining for the worker. Workers’ Compensation is administered by each state. While many rules are similar, some states have regulations and guidelines that are unique. It is best to contact your state workers’ compensation board to ascertain which forms, requirements or reporting methods to use.
According to the U.S. Chamber of Commerce there are six basic objectives in Workers’ Compensation law:
- Provide sure, prompt, and reasonable income and medical benefits to work accident victims, or income benefits to their dependents regardless of fault
- Provide a single remedy and reduce court delays, costs, and workloads arising out of personal-injury litigation
- Relieve public and private charities of financial drains, incident to uncompensated industrial accidents
- Eliminate payment of fees to lawyers and witnesses as well as time-consuming trials and appeals
- Encourage maximum employer interest in safety and rehabilitation through an appropriate experience-rating mechanism
- Promote frank study of causes of accidents (rather than concealment of fault), reducing preventable accidents and human suffering
Verification of Coverage
Proper verification of insurance coverage is the safest, smartest way to insure maximum reimbursement on all claims submitted. Sometimes it comes down to having a knowledge of what questions to ask. Some of the important items to verify include:
- Employer: Correct name, address, phone/fax number and contact person.
- Payer: Most states have many payers who write Workers’ Compensation coverage. A few states (e.g., Nevada) require insurance through a state run agency. Others allow for self-insured coverage if the employee meets specified guidelines.
- Date and time of injury or illness: These items may affect the acceptance of the claim by the payer.
- Description of how the accident or illness occurred: This will help to verify the liability of the Workers’ Compensation payer. This information will also help to provide a causal link between the work activity and the injury or illness.
When a patient comes to your office alleging a work-related injury, your first communication should be with the employer to verify the following information:
- The employer is familiar with the accident and the patient’s injury
- The employer’s report of the accident/injury has been filed with the insurance carrier
- The name of the employer’s Workers’ Compensation Insurance carrier
- The employer’s Workers’ Compensation policy number
Once you are satisfied with the information from the employer, call the Workers’ Compensation carrier and ask the following:
- Is the employer’s Workers’ Compensation policy still in force?
- Where should the claim be sent?
Proper billing and documentation can be very important in wrapping up the details of a claim.
- Charge only those fees allowable by the state in which you practice. Many states have guidelines for fees that are allowable.
- Code the diagnosis(es) most appropriate to the patient’s condition. Like Medicare, carriers often have a list of allowable diagnosis codes. It is a good idea to verify coverage exclusions and requirements by checking the carrier’s website.
Alert: There are times when a patient is referred to your office with a specific diagnosis already assigned to their workers compensation case/claim. Obtain this information from the referring provider. Using a different diagnosis code can result in the claim being denied.
- Send copies of your complete chart notes, whenever required or requested, in addition to any applicable reports or forms required by your state.
If these reports and claims are sent and are within the guidelines set forth by the Industrial Commission, you should have no problem obtaining reimbursement.
First Report of Injury
States require a First Report of Injury to be completed. Whether the physician and/or the employer completes this report will vary by state. Currently, each state has their own unique form which needs to be used and the required elements to be reported may also vary. Additionally, many states are encouraging the use of electronic filing instead of paper claims.
The International Association of Industrial Accident Boards and Commissions (IAIABC) is currently working with the American National Standards Institute (ANSI) and other governmental agencies (e.g., Occupational Safety and Health Administration (OSHA)) to standardize the Physician's First Report of Injury form. Hopefully, this will simplify this process in the future.
Loss of Work Time
Communication with the employer and insurance company is very important. After the examination has been completed and it becomes apparent that there will be a loss of time from work, contact the employer and payer and inform them of the physician’s findings. Indicate the estimated time off from work, treatment plan, and the necessity for any outside testing. Specific time frames for loss of work time vary by state. Refer to your state Workers’ Compensation Board for applicable time frames.
State Guidelines and Fee Schedules
Medical care accounts for a large portion of the total cost of Workers’ Compensation. Most states have initiated guidelines for controlling the medical dollars spent. These measures include adoption of fee schedules (state specific and/or the RBRVS), managed care mandates, choice of physician, pre-authorization for specific procedures and guidelines for frequency of care.
It is important for the provider to be familiar with the Workers’ Compensation reimbursement guidelines for the state in which they practice. Nearly every state prohibits billing the patient for any or all services unless the claim has been denied.
As with most payers, Workers’ Compensation payers may require pre-authorization for elective services. The procedures include diagnostic and therapeutic services such as CT, MRI, MRA, physical therapy, non-emergent surgical procedures and inpatient hospital care. It may be necessary to submit medical necessity documentation for peer review. Orthotics, prosthetics, and durable medical equipment may also need to be pre-authorized.
Some states govern the choice of provider to help control medical costs. States with managed care usually require the employee to use a designated physician or group. Some states with more stringent fee schedules may allow the patient to choose a physician. Other states may even limit the number of physician changes the patient may initiate.
When a clean claim is submitted, reimbursement is usually received in a timely manner. It is important to submit all required documentation with the initial billing. It may be necessary to provide explanations for unique circumstances and procedures.
If the claim is denied, determining the cause will help in submitting an appropriate appeal. Was the claim processed within state guidelines? Is the entire claim denied? Was pre-approval obtained prior to circumstances?
At times the payer may request an “independent medical evaluation.” This is usually a medical opinion based upon records and evaluation of the patient to render an unbiased statement regarding the patient’s condition and treatment plan. Most payers and providers negotiate a fee for this service unless a fee is specified in state guidelines.
The Workers’ Compensation patient may also require the completion of an “impairment rating.” Most states use the AMA’s Guide to the Evaluation of Permanent Impairment rating (there are several versions, the most current is the 6th edition.) Some states modify the AMA’s guide and others have their own specific criteria. This permanent impairment rating calculates a financial compensation for loss of function, body part, or other conditions that prohibit return to pre-injury status.
The medical disability evaluation code 99455 is reported when the treating physician completes the disability forms. When a non-treating physician completes the evaluation and necessary forms, code 99456 is used.
At times the physician may be asked to give a deposition or appear in court. Code 99075 for medical testimony is used to report that physician service. Fees should be agreed upon before the testimony or deposition is given. Billing should be directed to the requesting attorney.
Because the rules governing Workers’ Compensation vary from state to state, there may be discrepancies regarding patients who are injured out of their home state or who move after an injury. Contacting the payer and determining the liability prior to service will save time, frustration and money. If the patient leaves the state governing the care of the claim, the laws protecting the patient may not be applicable.