Has the Affordable Care Act had an impact on California workers’ comp?
This is the issue addressed by the California Workers' Compensation Insurance Rating Bureau in a May 2018 study titled, “Impact of the Affordable Care Act on California Workers’ Compensation. The study is authored by Tim Basuino and Julia Zhang, both medical analytics specialists with the WCIRB.
I applaud the WCIRB for looking into this issue but see the study as merely a first step in assessing the ACA impacts.
What follows is my reaction to issues explored in the WCIRB report.
Has the ACA affected injured workers’ access to care in the comp system? There has been some speculation that as large numbers of previously uninsured individuals gained coverage under the ACA, it would be harder and harder for injured workers to identify a willing physician to treat a work injury. The study concludes that there is no demonstrable affect of medical treatment access.
However, a weakness of the WCIRB paper is that the study looks only at the time from injury to getting first appointment with a doctor. Thus the study defines medical access very narrowly.
The study does not look at the anecdotal complaints that workers and attorneys have about finding doctors who are listed on the medical provider networks but who refuse to take comp cases or set appointments too far out in time. It does not look at access to specialty care.
Those issues may or may not have been affected by the ACA as well as utilization review/independent medical review, billing issues, etc., but the study does not really enlighten us on the effect of the ACA on a worker's overall access to treatment.
The study claims that medical pricing has not been affected by the ACA.
The study also looks at the issue of whether increased availability of health care benefits for workers had an affect on workers’ comp claims frequency (the number of claims).
Like many, I’ve been working on the hypothesis that one of the effects of the ACA would be cost-shifting from workers’ comp claims onto the ACA, as many previously uninsured workers gained health coverage. Simply speaking, the theory goes that many workers now have a new option for getting medical treatment that they did not have when they were uninsured, so they might use ACA coverage to get treatment rather than going through the hassles of workers’ comp. But is this the case?
The WCIRB makes a case for disproving the hypothesis that the ACA would lead to cost-shifting to group health from workers’ comp, insofar as we are looking at overall claims frequency. The methodology of the study involved comparing changes in claim frequency from 2013 to 2015 between industries that had higher levels of health coverage before the ACA, with industries that had lower levels of health coverage.
Contrary to the hypothesis, claims fell more in the industries that had higher levels of health coverage before the ACA. This was also the case when comparing small versus larger businesses, and a sample of smaller restaurants versus larger restaurants.
Thus, the WCIRB concludes:
“In summary, the study expected a relatively greater decline in overall claim frequency for employers with lower levels of health coverage, small businesses and small restaurants. The actual estimates for the changes in claim frequency were contrary to the study hypothesis in all three comparisons to the extent that if there was any ACA impact on overall claim frequency, other offsetting factors impacting claim frequency were more significant. These offsetting factors could potentially include the impact of the [Resource-Based Relative Value Scale], continued greater attention to workplace safety and the continued migration of experience to less hazardous industries.”
It must be noted, however, that Covered California began coverage on Jan. 1, 2014. So it strikes me that it may be early to come to definitive conclusions based on a study that is looking at changes in claims of 12 months' maturity between accident years 2013 through 2015.
While the WCIRB stats question whether overall claim frequency is being affected by the ACA, the study comes to a different conclusion on the subject of frequency of soft tissue injury claims. Employers in industries that had low levels of health coverage prior to the ACA experienced 12% decrease in the percentage of claims with soft tissue injuries while those in industries with higher levels of health coverage prior to the ACA had a 17.1% increase. This was a similar pattern when comparing small to large restaurants.
The WCIRB notes on this point that:
“There was indication of a significant ACA impact on claims with soft tissue injuries following ACA implementation for employers more likely impacted by the ACA. It is important to note that the results of the analysis do not prove that any differences in claim shares were caused by ACA implementation.”
The WCIRB also looked at pre- versus post-ACA shares of claims with comorbidities (conditions such as obesity, high blood pressure and diabetes). Here the WCIRB stats would seem to indicate that the ACA may be having an effect on the numbers of claims with comorbidities components, though their conclusion lacked confidence due to the limited amount of information available for study.
What’s all this mean? The WCIRB authors seem to point to post-ACA changes in certain types of claims, but not in the overall number of claims.
My sense is that we need to remember that there are a number of moving parts to consider here. Overall, claim frequency has been declining nationally, so there may be a number of factors contributing to declining claim frequency as is noted in the WCIRB study (workplace safety, migration to less-hazardous industries, etc.), as well as some not mentioned (changes in the comp system such as UR/IMR, doctor frustration with the comp system, etc.).
I’m sure we will see further analysis of this as time goes on.
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