A proposal by a Florida government watchdog group to revamp how medical claim disputes are handled has underscored the deep divide between claimants’ and insurance representatives in the Sunshine State.
The proposal by Florida TaxWatch, a nonpartisan organization, would remove most medical treatment disputes from the purview of the state's compensation judges. It would set up an independent medical review system made up of doctors, much like the program now used in California.
Insurance representatives suggested it’s a good idea that could save the system a fortune in litigation costs, slash the time it takes to resolve disputes and reduce the caseload on compensation judges.
Worker advocates said it would do little to cut medical and litigation costs. Besides, Florida already has a similar mechanism that requires compensation judges to call on doctors to give an opinion in disputed medical claims, said Paul Anderson, a Tallahassee claimants’ attorney and former chair of the Florida Bar Association’s workers’ compensation section.
“The idea that it would reduce litigation is wrong because that mechanism is already in place,” Anderson said. “The real cost driver in the system is medical costs, and this would only exacerbate that.”
Florida TaxWatch, which regularly produces white papers on ways that Florida government could save money, is headed by Dominic Calabro, a former research analyst with the group and with the Florida Senate.
“My good friend Dominic Calabro needs to buy me a drink and let me explain how the workers’ comp system in Florida works,” Anderson said.
Those on the other side of the grand divide said the TaxWatch plan would go well beyond Florida’s Expert Medical Adviser program. They say the proposal is worth exploring.
California’s IMR system employs physicians to hear appeals when a claimant is denied medical care. If a treatment request is denied, the claimant — called applicant in California — can request an independent medical review, and the employer or insurer must pay the cost.
The IMR doctor has final say on whether the treatment should be authorized. The IMR decisions may be appealed, but administrative law judges are not allowed to make decisions about medical necessity. Only narrow specific circumstances, such as factual errors, racial discrimination or fraud, are grounds for appeal.
After the California Legislature mandated IMR in 2012, the state hired Maximus Federal Services to provide the contracted doctors who perform the reviews. While California applicants' attorneys say the system denies appropriate care to workers, TaxWatch raved about the results.
“California has implemented a cost-effective, non-judicial process developed by Maximus … in which disputes about the medical treatment of injured workers are resolved by physicians instead of by the courts,” Calabro wrote in his introduction to the report. “This independent medical review process has been shown to resolve disputes timely (in approximately one month) and save the taxpayers more than $1 billion annually.”
Another accolade for the California program is that the process has drastically reduced the time involved in medical claims, the report noted. IMRs are done without the need of an administrative law judge or a hearing. The physician reviews the medical reports and must make a decision within 30 days.
In Florida, the Expert Medical Adviser program comes into play only after the claim goes before the Office of Judges of Compensation Claims. If physicians disagree about treatment, necessity or any other issue, the judge must call on a third-party physician to render a decision. The decision is presumed to be correct unless a judge has reason to depart from it, said David Langham, deputy chief judge of the Florida OJCC.
About 125 doctors around Florida have been enlisted to participate, which is only about two per county, Langham said.
Langham noted that the TaxWatch plan is similar to a proposal floated by a governor-appointed commission in 2003, known as Fair Care. At the time, some attorneys questioned whether Florida’s Constitution would allow the IMR system because of due-process issues. California’s Constitution appears to give the Legislature and state agencies more authority to enable the reviews by doctors, not judges, he said.
The TaxWatch proposal comes two weeks after the new president of the Florida Senate said workers’ compensation reform would be considered in next year’s legislative session, which begins in March. But it’s unclear how much support the independent medical review idea would have.
Steve Roddenberry, an insurance consultant with the Tallahassee insurance defense firm of Pennington P.A., said the TaxWatch plan looks promising, but he's not sure it would fly at the state Capitol.
“This would be a radical idea for this industry, and no one considers the industry in peril enough (or at all) to warrant something this progressive,” Roddenberry said in an email.
Although Florida has seen overall rate reductions for the past three years, employers and insurance groups have been concerned about litigation costs since the state Supreme Court in 2016 struck down statutory limits on attorneys’ fees.
After that ruling, rates increased but have dropped since then. Nonetheless, in fiscal 2017, attorneys’ fees topped $439 million in Florida workers’ compensation cases, and an IMR process would greatly reduce litigation costs, the report suggests.
Anderson, the claimants' attorney, argued that the concern was misplaced, because claimants’ attorneys’ fees come out of the benefits awards.
“It’s not the benefits and the litigation and the attorney fees that are the cost drivers,” Anderson said. “The problem is that 70% of costs are through medical.” Adding more physicians in the dispute resolution would increase medical costs, he said.
The report suggested that other benefits could accrue. In California, the IMR doctors have been shown to uphold most decisions that deny opioid medication for injured workers.
“IMR could be a useful tool in limiting the supply of opioids for patients and making sure that opioids are being prescribed consistent with established prescription guidelines,” the report concluded. “TaxWatch recommends the Legislature more fully evaluate the pros and cons of IMR, calculate the potential savings to the state and identify the steps necessary to implement IMR in Florida.”
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