We see it all the time: Employers – located in states where the employer gets to choose the doctor – allowing employees to choose the doctor for treatment for work-related injuries.
According to the Workers Compensation Research Institute, when the employee selects the primary provider, costs are generally higher and return-to-work outcomes less satisfactory.
Due to rising health care costs, there’s greater concern on the part of employers everywhere to keep claims costs down and to ensure medical treatment is appropriate for the injury. One cost-containment method is to require employees to see only designated physicians in states where this is possible.
Workers compensation laws differ by state
Each state’s workers compensation laws determine how a physician is selected. In some states, the employer gets to choose the physician; in other states, the employee chooses the physician, with no limitations.
To make it easy, one could say that a state is either an employer-choice or an employee-choice state, but that would not be completely accurate, because in some states:
- The employer can choose the physician, but they may be limited to 60 days.
- The employer must post a panel of physicians, and the employee chooses from that panel.
According to PricewaterhouseCoopers’ Health Research Institute, health care inflation remains double to triple that of the rest of the economy. Also, they predict that medical costs could rise as much as 6.8% in 2015. This rise in the cost of medical care can have an adverse effect on experience modification factors and the cost of workers compensation insurance.
With medical care rising in many states, lawmakers have increased their efforts to modify state laws to try to reduce workers compensation costs, while avoiding actions that might impair the outcomes experienced by injured workers. Some of the difficulty with changing state laws is related to strong opposition on both sides. Workers and their advocates feel that the choice of the treating physician should be left to the worker, arguing that employee choice ensures that the physician has the employee’s best interests in mind.
Employer advocates believe the choice of provider should be made by the employer, arguing that employer choice ensures that incentives exist for keeping the costs of care reasonable and appropriate. They further argue that employer choice helps avoid excessive treatment, and providers who are familiar with an employer can use that knowledge to expedite an injured employee’s return to work.
The role of a health care provider in workers comp claims
The health care provider plays a very important role in the outcome of any workers compensation claim. According to the Workers Compensation Research Institute, the health care provider plays a critical role in a workers compensation case, including:
- Diagnosing the condition and assessing its cause, which affects the medical and indemnity benefits owed to the employee, if benefits are owed at all
- Prescribing and providing a course of treatment and disability management, which determines if an employee can return to work, and how quickly
- Assessing if the employee’s condition has reached maximum medical improvement, if the worker has a permanent impairment, the extent of any impairment and if a preexisting condition contributed to the impairment
In summary, employers need to understand how a physician can be chosen in the states where they operate. In states that are not employer choice, having a physician that the employee can get into quickly can sometimes keep claims costs down. In employee choice states, however, employees get to decide whether they go to a physician recommended by their employer, or some other physician.
For additional information on workers compensation, policy instructions or requirements, please consult our online claims kit resource.
Let our account managers or risk management consultants assist you with these complex rules and help you set up a designated physician or panel, as required in your state.