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
White Espey, PLLC 2013 20
The Texas Legislature and
Workers’ Compensation
White Espey, PLLC 2014 21
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
White Espey, PLLC 2014 22
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
White Espey, PLLC 2014 23
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
White Espey, PLLC 2013 24
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
White Espey, PLLC 2014 25
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
White Espey, PLLC 2014 26
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
White Espey, PLLC 2014 27
What WE Want to See Again
Suspend Some Benefits Already
Privileged Communications
… I Love these bills
White Espey, PLLC 2014 28
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
White Espey, PLLC 2014 29
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
White Espey, PLLC 2014 30
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
White Espey, PLLC 2014 31
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
White Espey, PLLC 2014 32
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
White Espey, PLLC 2014 33
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
White Espey, PLLC 2014 34
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
White Espey, PLLC 2014 35
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
White Espey, PLLC 2014 36
Bad Faith
SB 1049 would allow bad faith claims to be brought in workers’ compensation cases.
Died in committee
White Espey, PLLC 2013 37
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
White Espey, PLLC 2013 38
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
White Espey, PLLC 2013 39
◦ 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
White Espey, PLLC 2013 40
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
White Espey, PLLC 2013 41
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
White Espey, PLLC 2013 42
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
White Espey, PLLC 2013 43
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
White Espey, PLLC 2013 44
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
White Espey, PLLC 2013 45
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
White Espey, PLLC 2013 46
Document Request Letter Unconfirmed Allegation Violation Enforcement Action
Failure to Fulfill Responsibilities Can Result In...
White Espey, PLLC 2013 47
Document Request Letter
White Espey, PLLC 2013 48
Unconfirmed Allegation Letter
White Espey, PLLC 2013 49
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
White Espey, PLLC 2013 50
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
White Espey, PLLC 2013 51
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
White Espey, PLLC 2013 52
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
White Espey, PLLC 2013 53
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
White Espey, PLLC 2013 54
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 2013 55
White Espey, PLLC Questions? Call us.
Tim White 512-983-2994Camille Espey 713-882-5351
Roy Horton 214-998-1567Thurman Williams 214-288-2459