MONTANA SELF INSURERS' ASSOCIATION

January 2022 Update

MSIA Comments on Red Tape Initiative Rules Proposals
Allan Koba CMS Year in Review Webinar - 1/11/24 – FREE
20 Issues to Watch in 2024 Webinar - 1/9/24 – FREE
Impact of [Medical] Vertical Integration in Workers’ Compensation
Coming Up - - National Council of Self Insurers Annual Conference June 2 – 5. Don Cesar Hotel – St Pete Beach, FL – Special MSIA Member Rate

MSIA Comments on Red Tape Initiative Rules Proposals

First announced at the MSIA Business & Annual meeting in September, the Employment Standards Division of the Department of Labor (ESD, formerly ERD) released a 125 page exposure draft of the ‘Red Tape Initiative’ rules changes for workers compensation in November. ESD would like to be able to consolidate comments and publish DRAFT rules for final adoption sometime in January 2024.

ESD leadership and staff have done yeoman’s work in creating the exposure draft and deserve accolades to make Montana workers’ compensation rules easier to read, understand and use. MSIA met with ESD Deputy Administrator Bill Wheeler to discuss the ideas behind some of the changes and to share our thoughts on others. A copy of the exposure draft and formal MSIA comments to ESD is attached.

Most important to MSIA was the proposed change to report loss reserves on claims where statutory Second Injury Fund (SIF) reimbursements are requested (24.29.2614). The request for claim reserve information stems from a desire to predict the ultimate SIF liabilities and report that to public policymakers.

MSIA and some members shared our opposition to this request and suggested at least one alternative that did not require employers and carriers to report proprietary case reserve information. ESD indicated there are potential alternatives and would consider our concerns. Case reserves are created based on individual proprietary approaches taken by carriers/employers to determine their case and aggregate reserves and are driven not only by individual claim characteristics but business, legal and financial needs. In simple terms, each carrier/employer determines case reserves based on what can be very different business standards that are appropriately proprietary to them. Based on that, there is no standardization to the information ESD would receive. Thus, ESD would have no basis to explain to public policymakers how the estimates of ultimate liability were created. There are better alternatives to deriving the potential ultimate liabilities for SIF other than requiring proprietary system based case reserves and they should be taken.

One of the proposed changes would have eliminated the minimum age of 18 and a minimum of a high school (or equivalent) diploma to be certified to manage claims in Montana (24.29.821). MSIA prefers at least a HS or equivalent degree and is opposed to people who are not of legal age having access to private personal medical, wage and employment information and making decisions on them. People under the legal age are not necessarily legally responsible for their decisions or actions. MSIA thinks that it is a poor precedent to provide personal, private information to under legal age individuals and expect reasonable levels of professionalism, discretion and decision making from them.

MSIA has recommended the retention of statutory interpretive language regarding injured workers utilizing emergency room or urgent care services rather than the designated treating physician (24.29.1512) and on balance billing issues (24.29.1401). Our goal in making these recommendations is an easy to understand and interpret set of rules within the Montana workers’ compensation system. Eliminating this language, as proposed, will generate questions that may have to be litigated for interpretation, while we currently have interpretative language in the existing rule. We appreciate the desire to simplify, but sometimes the simplest approach is to specifically provide the interpretation used within the system.

MSIA also recommended retaining the policy statement regarding the adoption and use of the Utilization the Treatment Guidelines (24.29.1501). Such a statement, while not required in rulemaking, helps readers understand the purpose of the Guidelines and how they should be used. Again, while not required, inclusion improves the rules.

Other MSIA suggestions relate to formatting and form. For example, rather than simply deleting repetitive statutory definitional language, MSIA recommended retaining or providing a reference to the statute so it is clear what the rule relates to and what definitions will be used.

MSIA has shared our thoughts with ESD and has made the insurers (Plans 2 & 3) as well as business associations aware of our concerns. When the new proposed rules changes are released for potential adoption, MSIA will keep members up to date regarding the changes and the opportunities to share our thoughts on them.

Allan Koba CMS Year In Review Webinar 1/11/24 @ Noon MST - FREE

This webinar hosted by Ciara Koba and Michelle Allan will review the changes in Medicare Secondary Payer rules and issues put in place last year.

2023 was a particularly active year for new CMS guidelines, rules, updates and penalties for incorrect reporting. Some of the changes are enough to make your head spin. Koba and Allan are national leaders in the workers’ compensation (and other liability lines) MSA and Section 111 reporting space and are involved in any number of groups active in making the federal laws make more sense. This webinar will help us all understand the changes and how they will impact our business. The webinar is free, although advance registration is required.

Allan Koba Compliance Solutions is an MSIA member. SIGN UP TODAY!

20 Issues to Watch in 2024 – Webinar 1/9/2024 10a – 11:30 MST - FREE

Mark Walls, with Safety National, co-hosts this annual webinar with his wife, Kimberly George identifying what they see as the top 20 issues in workers’ compensation for the coming year. This year, topics will include:

Trends impacting frequency of severity rates in catastrophic claims
Effects of legal system abuse in liability verdicts
Expectations for evolving employee benefits
Industries facing increasing workplace violence
And more!

This annual Webinar is fast paced and always entertaining, while providing a good snapshot of what is going on and may happen in the workers’ compensation world in the US. The webinar is free, although advance registration is required. Safety National is an MSIA member.

Impact of [Medical] Vertical Integration in Workers’ Compensation

The Workers’ Compensation Research Institute (WCRI) last month released a new study on the impact of medical integration on workers’ compensation claims. There is no question the consolidation of medical markets has been a driver in the changes in how we receive and seek medical care. For the first time this study provides some results on how the impact of vertical integration of medical care may impact workers’ compensation costs per claim, the number of medical visits per claim and the level of care provided per visit.

The study’s conclusion: “When treated by vertically integrated providers, workers received more medical care and saw more provider, which led to higher medical payments per claim and longer duration of temporary disability.” The study found,

more services billed/provided per visit (0.9 – 4.5%)
more evaluation and management services (10.5%)
more providers seeing the patient (18.9%)
more imaging services (14.1%) and
more billing for higher intensity office visits (2.7%)

Perhaps most important for Montana, the study stated,

Although policies to directly influence vertical integration may be beyond the purview of workers’ compensation policymakers and insurers, the evidence presented in this study indicates that some workers’ compensation policies may mitigate the impacts of increasing vertical integration on medical payments and utilization of care. Specifically, we found little change in medical payments per claim and the duration of disability due to vertical integration in states that give employers control over the choice of medical providers.” (emphasis added)

Montana enacted employer choice of medical provider in the reforms of 2011 and that change was credited with a minimum of an 8.4% decrease in overall system cost. Every legislative session there are proposals to remove this section of law and to provide choice of medical provider to the injured worker. That change could have significant cost implications for the Montana system. This study confirms some of the reasons for those potential cost changes.

The study relied on WC claims information from carriers and state funds in 34 states (Montana is not included) for claims with more than 7 day of lost time, at six and twelve months after injury from January 2012 – June 2018. These 34 states represent 85% of benefits paid in 2017.

Contact the MSIA office if you would like a copy of this or other WCRI studies.

Coming Up - - National Council of Self Insurers Annual Conference June 2 – 5
Don Cesar Hotel – St Pete Beach, FL – Special MSIA Member Rate

The National Council of Self Insurers is coming back! This year’s Annual Conference will be held June 2 – 5 at the incredible Don Cesar Hotel on St. Petersburgh Beach, FLA. The conference is the place to contact other national and regional self insurers and vendors and learn the latest in how to address workers’ compensation claims, costs and the latest in technology assisted devices and systems.

MSIA members get special pricing – MSIA members pay the National Council member price (saving $200).