Coalition to Protect Worker s Compensation

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1 Coalition to Protect Worker s Compensation Statement Regarding Public Hearing on Worker s Compensation Legislation Madison (February 4, 2014) --- Health care providers testified at a Joint Labor Committee hearing today in opposition to AB 711 and SB 550. The legislation would dramatically change Wisconsin s 100-year-old Worker s Compensation program by legislating government price setting for medical services delivered to injured workers. The bill would impose government controls on hospitals, physicians, chiropractors, physical therapists and other practitioners who provide care to injured workers covered by the Worker s Compensation program. AB 711 and SB 550 require that reimbursement for care provided workers harmed on the job be set by bureaucrats in the state Department of Workforce Development. Facts presented at the hearing overwhelmingly documented that the fee schedule proposal works against value-based health care and is a risky gamble for Wisconsin s excellent Worker s Compensation system. It s gratifying to see that when legislators hear the pertinent facts and data about our successful worker s compensation program, they get even more uncomfortable with the bill as it s drafted, said Rick Abrams, CEO, Wisconsin Medical Society. We should be finding the specific areas where worker s comp needs improvement not taking a sledgehammer to the entire system. A growing coalition of health care providers from across Wisconsin is educating legislators on the strengths of Wisconsin s current Worker s Compensation system. Injured workers in Wisconsin get back to work three weeks faster and at a cost below the national average. Wisconsin s current Worker s Compensation system produces excellent health care outcomes at a cost that is more competitive than most of the country, according to Steve Brenton, president, Wisconsin Hospital Association. We can t control how many workers are injured at their jobs in Wisconsin, but when they do arrive at our hospitals, and a lot of them do, we give them some of the best care in the country, get them back to their families sooner and back working faster than in most any other state. Responding to narrow data presented by the worker s compensation insurance industry, the medical community presented a more complete and accurate picture of what is really happening in Wisconsin, proving that the cost

2 of medical care provided to an injured worker is well below the national average, and the outcomes of that care are superior. A recent study by the Workers Compensation Research Institute also showed that, among states studied, Wisconsin providers have some of the lowest utilization of services. This means Wisconsin providers are delivering efficient and effective health care at a lower cost than the national average. For more than 100 years, Wisconsin s health care providers have provided excellent and efficient care to injured workers, said Jeffrey M. Wilder, DC, FACO, President, Madison Chiropractic, representing the Wisconsin Chiropractic Association. The truth is a government imposed fee schedule in the Worker s Compensation program is a solution looking for a problem. Wisconsin s Worker s Compensation program is an asset for this state that we should be promoting, not tearing down. Wisconsin s health care providers are working diligently to get injured workers back on the job. The data clearly shows that health care providers in Wisconsin are holding up their end of the bargain in this program. We have been successful as providers in controlling costs for the Worker s Compensation program, helping employers avoid the high costs of lost time from work, said Brett Roberts, DPT, CEO, Roberts and Associates Physical Therapy, representing the Wisconsin Physical Therapy Association. Dismantling the current system could trigger unintended consequences in a program that now produces excellent results for injured workers. END Contact: Mary Kay Grasmick, Wisconsin Hospital Association,

3 Coalition to PROTECT Worker s Compensation The Wisconsin Legislature is considering a bill that would impose a fee schedule on hospitals, physicians, chiropractors, physical therapists, and other practitioners providing Worker s Compensation care to injured workers. The legislature has never considered mandating artificial rates between private payers and providers in the more than 100-year-old program. The organizations below, representing some of the highest quality health care in the country, ask you to oppose this unprecedented and damaging proposal.

4 The Facts Studies show that Wisconsin has one of the best Worker s Compensation systems in the nation primarily due to the high quality health care that s provided: Wisconsin injured workers are highly satisfied with the health care they receive through our Worker s Compensation system. This satisfaction results in a very low level of lawyering up after an injury on the job. A low litigation rate means a Wisconsin employer has a productive, satisfied employee back on the job following an injury sooner than the national average a full three weeks faster than the average state LA NC GA SC OK CA PA TX NM IL MS CO MA NY TN Avg VT DC KY VA MT MI MD AL AR DE HI RI KS NH AK NV ME AZ NJ NE IN CT ID MN IA MO UT SD OR FL WI Source: NCCI Research Brief (August 2013, Table 3), published by the National Council on Compensation Insurance, Inc. (NCCI). Wisconsin s health care system delivers care efficiently, with fewer visits required per claim and fewer services per visit. Efficiently delivered care results in lower costs. The cost of the medical portion of a Worker s Compensation-related claim is well below the national average (and lower than our neighbors in Illinois, Iowa and Minnesota). $18,000 $16,000 $14,000 $12,000 $10,000 $8,000 $6,000 $4,000 $2,000 $0 DE MT CA LA AK IL AL NY NJ NH MN OK MD CT VA NM MS GA SC Avg KY FL TN NC TX MO VT NE SD PA IA KS AZ WI DC UT HI AR OR ID NV IN CO MA MI ME RI Source: Annual Statistical Bulletins ( , Exhibit XI), National Council on Compensation Insurance, Inc. (NCCI).

5 Bottom Line Wisconsin s current Worker s Compensation system results in fantastic health care outcomes, promoting healthier workers satisfied with the system at a more competitive cost than most of the country. It is one of the many reasons to locate and grow a business in Wisconsin. $20,000 $15,000 <-- Low Medical Costs High--> WI $10,000 Average $5,000 $0 <--F ewer Days Temporary Total Disability More Days--> Sources: Annual Statistical Bulletins ( , Exhibit XI), National Council on Compensation Insurance, Inc. (NCCI). NCCI Research Brief (August 2013, Table 3), published by the National Council on Compensation Insurance, Inc. (NCCI). The Threat Government-set price controls do not promote efficiency, improve quality, or encourage better-coordinated care. In fact, fee schedules work against value-based health care. Worker s Compensation care requires many more administrative and procedural headaches than other health care areas. Fee schedules do nothing to reduce these unnecessary costs. Message to Legislators/Governor The Worker s Compensation system is more administratively difficult and time-consuming than other insurance systems and much more so than group health. An artificial fee schedule is a risky gamble for a very successful Worker s Compensation system; it could ruin what is a national model. (continued on next page)

6 Message to Legislators/Governor (continued) Wisconsin s Worker s Compensation system is a success story: injured employees have ready access to highquality health care; insurance rates businesses pay for WC insurance have actually decreased each of the last three years. Year 2009 Year 2010 Year 2011 Year 2012 Year % 3.35% -0.01% -1.36% -1.73% 5 year net total overall premium rate change: 0.65% 5 year average annual change: 0.13% Source: DWD PowerPoint Presentation to Joint Informational Hearing, July 31, Wisconsin businesses and insurers should work to reduce costs by improving worker safety (Wisconsin has a higher injury rate than most other states) and with, rather than against, the area of Worker s Compensation that is performing successfully - health care - to improve the system. Table D Ranking by Claim Frequency per 100,000 Workers Using Rating Bureau Information, Average of Policy Years State Average Claim Frequency 3-Year Average Nevada Montana Maine Idaho Oregon Wisconsin Pennsylvania South Dakota Massachusetts Texas Virginia Louisiana Maryland New York District of Columbia Source: Annual Statistical Bulletins ( , Exhibit XII), National Council on Compensation Insurance, Inc. (NCCI).

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