white espey, pllc prima presentation texas workers compensation trends

WHITE ESPEY, PLLC PRIMA PRESENTATION

Texas Workers Compensation Trends

Camille EspeyThurman Williams

White Espey, PLLC 2014 2

Facts and Figures in the IndustryLegislative Changes: 2013, 2015 Success StoriesSurprising Elements of the Texas Workers Compensation system

Recap: Employer Rights and Responsibilities

OVERVIEW

3

WORKER’COMPENSATION STATISTICS

IR 15% OR GREATER

2004 2005 2006 2007 2008 2009 2010 2011 2012 20130

1,000

2,000

3,000

4,000

5,000

6,000

7,000 6556

4911

3863

31112756

2453 2301 2197 2156 2055

4

IR ABOVE 15%

5

2004 2005 2006 2007 2008 2009 2010 2011 2012 20130

1,000

2,000

3,000

4,000

5,000

6,000

7,000 6556

4911

3863

31112756

24532301 2197 2156 2055

69% reduction in ten years

84% reduction since peak year (2001)

5% decline from last year (7% decline in injuries

Ramifications

Lower IIBS and attorney fees

Lower SIBs

INITIAL SIBS APPLICATIONS

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

0

500

1,000

1,500

2,000

2,500

2015

1501

1104

828634

396 443534 620

481841

613489

324 347218 202 252 330 258

Initial App Initial Approved

6

SIBS 76% reduction in SIBS

apps over last ten years (80% drop from 2002 peak)

69% reduction in initial SIBS approval (75% drop since 2002 peak)

22% decline since last year

Ramifications

Lower SIBS and attorney fees

Impacts attorney fees in JR

7

0

500

1,000

1,500

2,000

2,500

2015

1501

1104

828634

396443534620481841

613489

324347218202252330258

Initial App

BRCS

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

28,320

21,329

15,793

12,939 11,195 10,610

9,035

11,507 11,106 10,721

8

BRC DWC reported lower revised figures to me from 2012

62% ten year decline

63% decline from peak in 2003

3% decline from last year

On pace for a decline this year

Ramifications

Number of BRC are levelling off

Don’t know what impact the scheduling order process will have

9

CCHs

2004 2005 2006 2007 2008 2009 2010 2011 2012 20134000

4500

5000

5500

6000

6500

7000

7500

8000

8500

7860

7267

6688

5785

4959 4924

4362

4871

6079

6422

CCHs

10

CCH 18% decline ten year decline

5% increase from last year

Since 2010

32% increase in hearings

Not including the number of CCHs requiring management

(in 2010, 45% decline from 2004)

Ramifications

Hearing officers are busy

11

HEARINGS

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

0

5000

10000

15000

20000

25000

30000

35000

40000

Chart Title

BRC CCH

53% drop in hearings since 2004

But, a 22% increase in hearings since 2010

12

PERCENTAGE OF MMI/IR/EXTENT

2008 2009 2010 2011 2012 201320%

25%

30%

35%

40%

45%

50%

55%

60%

65%

28%31%

34%

48%

60% 59%

BRCs

13

% OF CONCLUDED BRC’s THAT ARE RESOLVED BY CCH

2005 2006 2007 2008 2009 2010 2011 2012 201335%

40%

45%

50%

55%

60%

65%

70%

41%

51% 50%52%

54% 54%

63% 64%66%

14

PERCENTAGE OF MMI/IR/EXTENT

2008 2009 2010 2011 2012 201320%

25%

30%

35%

40%

45%

50%

55%

60%

65%

25%27%

29%

51%54%

59%

CCHs

15

% OF ISSUES ARE MMI/IR/EXTENT

2008 2009 2010 2011 2012 201320%

25%

30%

35%

40%

45%

50%

55%

60%

65%

28%31%

34%

48%

60% 59%

25%27%

29%

51%54%

59%

BRCCCH

16

DWC DATA 43% reduction in PLN-1since 2005

◦ Ruttiger?◦ 33% reduction in injuries?

70% reduction in MDR since 2003 76% reduction in DWC-45s

◦ 44% of all claims in 2003◦ 17% of all claims in 2013

17

ATTORNEY FEES

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

$41,708,411

$37,693,379

$34,402,983

$32,629,119

$33,523,769$33,073,867

$32,392,646

$34,717,356$34,938,208

$28,413,207

$23,444,999

$23,806,115

$23,089,128

$24,350,516

$22,496,199

$24,195,900

$30,612,149

$32,076,416

ClaimantCarrier

ATTORNEY FEES

CLAIMANTS

.6% increase from 2012 5% increase from 2010 BUT 16% decrease from 10 years ago

CARRIER

5% increase from 2012 36% increase form 2010 19% increase from ten years ago Smallest difference between claimant and

carrier BUT audits and reverse actions

19


The Texas Legislature and

Workers’ Compensation


WHAT TO EXPECT IN THE 2015 LEGISLATIVE SESSION…

First Responder Bills…like HB 365 & HB 1091

Public Projects Bills…like HB 475 & SB 740

Political Subdivision Bills…like HB 1430 & HB 1697 & SB 1205

…I’ve seen these before


Expanded Presumption for First Responders

HB 365 would make several changes to the presumption that certain workers who sustain injuries did so while in the course and scope of employment. First, this bill would remove the “strenuous activity requirement” to invoke the myocardial infarction presumption. This bill would also create an additional presumption that any firefighter or EMT who contracts AIDS, HIV, Hep B, Hep C or MRSA did so while in the course and scope of employment as long as there was potential exposure to said disease during a call or response.

Considered in House


Tougher Presumption for First Responders

HB 1091 would entitle former firefighters or EMTs to a presumption that an injury was sustained while in the course and scope of employment as long as the claim was reported within 5 years of leaving the position as a firefighter or EMT. This bill, although probably not the intent of the drafter, would put a deadline on reporting work-related diseases by former firefighters and EMTs.

Died in committee


DWC Recognizes 2014 Star of Texas Award RecipientsAUSTIN, TX

The Division of Workers’ Compensation (DWC) recognizes the 2014 recipients of the Texas Star Award which honors peace officers, firefighters and emergency medical first responders who have been seriously injured or killed in the line of duty. Governor Rick Perry presented these awards to selected first responders and their families on September 2, 2014. The 78th Legislature created the awards in 2003 by the passage of House Bill 1937 and recipients are selected by three advisory committees appointed by the Governor.“Every year first responders are injured or killed in the line of duty while working to save lives and keep our communities safe,” said Commissioner of Workers’ Compensation Ryan Brannan. “Our job is to ensure that the workers’ compensation system is available to those injured employees and their families and that every injured employee receives all of the benefits that they are entitled to under the law.”

First Responders in the news


Coverage Please

HB 475 & SB 740 would require contractors and subcontractors to carry workers’ compensation insurance when performing public projects.

HB 475- Died in committeeSB 740- Read only


You Can’t Fire MeHB 1430 & HB 1697 & SB 1205 would prevent an employer

from discharging, indefinitely suspending, or terminating from employment a peace officer, detention officer, county jailer, or firefighter based on the person’s inability to perform their job duties as a result of a compensable injury, before the person is certified as having reached maximum medical improvement. An adverse action made by the employer as described would result in damages and reinstatement of the employee.

HB 1430- Considered in HouseHB 1697- Died in CommitteeSB 1205- Read only


What WE Want to See Again

Suspend Some Benefits Already

Privileged Communications

… I Love these bills


Go to the DD…or else

HB 1155 would authorize insurance companies to suspend all income benefits if an employee fails to submit to an examination by a designated doctor. The current law only allows suspension of temporary income benefits, not impairment or supplemental income benefits.

Considered in House


This is Just Between Us

HB 1468 & SB 926 would make certain communications between an insurance carrier and an employer confidential and privileged. This bill is in response to In re XL Specialty Insurance Company and Cambridge Integrated Services Group, Inc., in which the Texas Supreme Court found that communications between an insurance carrier’s attorney and the insured (employer) were not privileged.

HB 1468- Passed in House, pending in SenateSB 926- Read only


What WE Don’t Want to See… Immunity Waiver Bills…like HB 1424 Impairment Bills…like HB 2249 & SB 1077

◦or HB 2629 & SB 1051 Attorney Fee Bills…like HB 2787 & SB

1550 (some version of these carrier-pay bills are filed every session)

Waiver Bills…like 2630 Bad Faith Bills…like SB 1049

…please don’t pass these


Goodbye Immunity?

HB 1424 would waive a governmental entity’s immunity from retaliation lawsuits brought by first responders. This would effectively overrule the Texas Supreme Court’s decision in Travis Central Appraisal District v. Norman as it relates to first responders.

Considered in House


LIBs Entitlement

HB 2249 & SB 1077 would qualify injured workers for Lifetime Income Benefits if they receive an impairment rating of at least 85% or more according to the AMA Guides.

HB 2249- Read onlySB 1077- Read only


Spinal ROM?

HB 2629 & SB 1051 would require the Division to use the range of motion model to determine impairment in the lumbar spine instead of the injury/DRE model. (However, this bill states the range of model method as used in the 6th edition of the AMA Guides is to be used; the Division’s Rules currently only permit ratings from the 4th edition to be used. SB 1051 corrects this oversight.)

HB 2629- Left pendingSB 1051- Read only


Pay My Attorney

HB 2787 & SB 1550 would require insurance carriers to pay an injured worker’s attorney’s fees in medical necessity disputes brought for judicial review.

HB 2787- Left pendingSB 1550- Read only


More Waiver?HB 2630 would create an additional period in which a carrier

can waive its ability to dispute an injury if a timely dispute is not filed. Currently, the waiver period only applies to the first 60 days following an injury. The carrier waives into the diagnoses that exist within the first 60 days if a dispute is not filed by the 60th day. This bill would create an additional 60-day waiver period (following the initial 60-day waiver period) for all new manifestations of the original injury, additional injuries, or additional diagnoses. Failure to dispute within this new 60-day period would result in a carrier’s waiver of its right to contest the extent or compensability of the new manifestation of the original injury, additional injury, or diagnosis.

Read only


Bad Faith

SB 1049 would allow bad faith claims to be brought in workers’ compensation cases.

Died in committee


HB 1762 allows a temporary employment service to extend coverage to all employees assigned to a client.

HB 2645 prohibits an independent review organization from publicly releasing patient information that is protected by HIPAA and requires IROs to be established in and maintain a physical address and mailing address in Texas and to be in good standing with the comptroller.

HB 3152 requires persons serving as both a management contractor for a network and as an agent of a health care provider to specify in the contract the certified network’s contract rate for health care services and the amount of reimbursement the health care provider will be paid after the health care provider agent’s fee for providing administrative services is applied.

SB 1322 allows the creation of limited ancillary service networks for durable medical equipment or home health services.

2013 Legislature: What Did Pass


SB 381 prohibits the misuse of the name or symbol of the Division of Workers’ Compensation of the Texas Department of Insurance in a deceptive manner on a business document. It prohibits individuals from using the following phrases in a deceptive manner:

1. the words “Texas Department of Insurance,” “Department of Insurance,” “Texas Workers’ Compensation,” or “division of workers’ compensation”;

2. any term using both “Texas” and “Workers’ Compensation” or any term using both “Texas” and “Workers’ Comp”;

3. the initials “T.D.I.”; or 4. any combination or variation of the words or initials, or

any term deceptively similar to the words or initials.

2013 Legislature: What Did Pass


◦ A. Using the treating doctor to testify: Hight Developing relationships with health care providers

◦ B. Taking the Time to Meet with the Attorney: Hancock

◦ C. Battling the Deranged Designated Doctor: Hopens

◦ D. Shut Down Treatment, Shut Down the Claim: Wrobel

Relationships with health care providers, Part 2

◦ E. Lesser of Two Evils: Extent vs. DD: Hutchton

Success Stories


Is Bad Faith Dead? (Ruttiger); Walking Dead? (Palmer)

An employee who can open doors and carry groceries with his hands can nevertheless qualify for LIBS based on total and permanent loss of use of both hands (DeLoss)

An employee is not required to present any medical evidence to prove that he/she sustained a sprain/strain injury.

Injuries sustained while merely sitting, standing or walking at work may be compensable.

Surprising Elements of Texas Workers’ Compensation


Dispute resolution is issue-driven. The parties may go to ten or twelve administrative hearings, or more, on one claim. Every issue may be appealed through six levels: BRC (mediation), CCH (administrative trial), Appeals Panel (administrative appeal), judicial review (District Court), Court of Appeals, Texas Supreme Court. Appeals through the first three levels are common; appeals through the last three levels are rare.

In an appeal to District Court, the Carrier may pay the Claimant’s attorney’s fees if the Carrier loses.

More Surprising Elements


Receive notice of an injury within 30 days of the date of injury◦Unless:

1. Good cause exists.2. The employer has actual knowledge of the injury.

3. The claim isn’t denied.

Employer’s Rights


Contest compensability of a claim if the insurance carrier accepts liability

Be notified of a proposed settlement

Attend and offer evidence at hearings

Report suspected fraud to the TDI/DWC

Receive return-to-work coordination services to facilitate an employee’s return to work

Employer’s Rights


Notify employees of workers compensation coverage◦ Post Notices at each work site◦ Give written notice to all employees

Usually part of the hiring packet

Report work-related injuries and illnesses◦ Within eight days of notice of injury, file a DWC-1 Form

(First Report of Injury) with the insurance carrier: For a specific-trauma injury that results in absence from

work for more than one day; For an occupational illness, (length of absence isn’t

relevant); For a fatality. Provide a copy to the employee

Employer’s Responsibilities


Report Employee’s Wages on a DWC-3 Form File the Employee’s Wage Statement with the insurance carrier

within 30 days of The date the employer is notified that the employee is entitled to income

benefits, or The date of the employee’s death

File a subsequent wage statement within seven days of a change in wage information

Report changes in an employee’s pay or employment status to the insurance carrier

Form DWC-6 File the form within ten days of an employee’s resignation,

termination, or change in pay File the form within three days of the date an employee begins to

lose time from work as a result of an injury, returns to work, or misses additional days of work.

Employer’s Responsibilities


Document Request Letter Unconfirmed Allegation Violation Enforcement Action

Failure to Fulfill Responsibilities Can Result In...


Document Request Letter


Unconfirmed Allegation Letter


Adair Grain Company of WestOrder Number: DWC-2789Date of Order: 9/30/2013Action Taken: Fined $500Violation: Failed to timely file and/or accurately complete TDI-DWC forms, reports or records

Violation/Enforcement Action


Alvarado, Hilario III, M.D. of San AntonioOrder Number: DWC-2903, Date of Order: 12/16/2013Action Taken: Fined $2,000Violation: Refused to accept a TDI-DWC appointment to perform a subsequent designated doctor examination on one injured employee

Gonzales, Mary Anastasia M.D. of AustinOrder Number: DWC-2901, Date of Order: 12/16/2014Action Taken: Fined $500; Must complete designated doctor workshopViolation: Failed to correctly apply AMA Guides; Failed to document adequately in one designated doctor examination,

Lubor Jan Jarolimek M.D. of HoustonOrder Number: DWC-2902, Date of Order: 12/16/2013Action Taken: Fined $1,000; Must complete DD workshopViolation: Failed to correctly apply the AMA Guides; ordered an unnecessary medical test; Failed to document an adequate narrative report

Most Recent Violations


Sanders, Mark Seltzer M.D. of HoustonOrder Number: DWC-2900,

Date of Order: 12/16/2014Action Taken: Permanently surrendered designated doctor certification and certification to assign maximum medical improvement and impairment ratingsViolation: Failed to comply with a TDI-DWC Order for Production;

Ordered an unnecessary medical test as part of a designated doctor examination

More Recent Violations


Smith, Stephen L., D.O. of FredericksburgOrder Number: DWC-2910, Date of Order: 12/17/2013Action Taken: Must complete designated doctor training and pass the certification test; upon timely passing the designated doctor certification test, must participate in medical quality review monitoring review and pay $15,000 fine

Violation: Failed to comply with TDI-DWC decisions and orders; Designated doctor assessments of injured employees overturned by contested

case hearings; Used inflammatory and inappropriate language in his designated doctor reports

for injured employees; Designated doctor examination's diagnoses, evaluations, and impairment

ratings were substantially different from those that Commissioner finds to be fair and reasonable;

Did not address the issues as ordered by TDI-DWC in the form and manner prescribed;

Misrepresented or omitted pertinent facts in his medical evaluations and narrative reports;

Submitted a charge for health care that was not furnished; Failed to perform a complete physical examination for purpose of determining

MMI and IR; Failed to timely file and/or accurately complete TDI-DWC forms, reports or

records.

More Recent Violations


Allmerica Financial Benefit Insurance Company of Worcester, MAAction Taken: Fined $2,140Violation: Failed to accurately submit medical bill and payment

American Casualty Company of Reading, Pennsylvania of Chicago, ILAction Taken: Fined $7,312Violation: Failed to accurately submit medical bill and payment data

American Guarantee and Liability Insurance Company of Schaumburg, ILAction Taken: Fined $1,095Violation: Failed to accurately submit medical bill and payment data

American Zurich Insurance Company of Schaumburg, ILAction Taken: Fined $16,514Violation: Failed to accurately submit medical bill and payment data

City of McAllen of McAllenAction Taken: Fined $1,804Violation: Failed to accurately submit medical bill and payment data

Clarendon National Insurance Company of New York City, NYAction Taken: Fined $4,053Violation: Failed to accurately submit medical bill and payment data

Most Common Violation


Employers Compensation Insurance Company of Reno, NVAction Taken: Fined $1,125Violation: Failed to accurately submit medical bill and payment data

GuideOne Elite Insurance Company of West Des Moines, IAAction Taken: Fined $4,042Violation: Failed to accurately submit medical bill and payment data

Hanover Lloyd's Insurance Company of Worcester, MAAction Taken: Fined $2,132; Violation: Failed to accurately submit medical bill and payment data

Harris County of HoustonAction Taken: Fined $1,985Violation: Failed to accurately submit medical bill and payment data

Most Common Violation (cont’d)


White Espey, PLLC Questions? Call us.

Tim White 512-983-2994Camille Espey 713-882-5351

Roy Horton 214-998-1567Thurman Williams 214-288-2459

white espey, pllc prima presentation texas workers compensation trends

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