Auto Accident Claims: The Influence of Colossus on Recoveries

Transcription

1 Presenting a live 90-minute webinar with interactive Q&A Auto Accident Claims: The Influence of Colossus on Recoveries Guidance for Counsel on Insurance Adjustment Software to Maximize Settlement Offers THURSDAY, NOVEMBER 29, pm Eastern 12pm Central 11am Mountain 10am Pacific Today s faculty features: Matthew J. DeGaetano, Certified Colossus Consultant, Personal Injury Institute, Lewisville, Texas Steven M. Gursten, Attorney, Michigan Auto Law, Farmington Hills, Mich. The audio portion of the conference may be accessed via the telephone or by using your computer's speakers. Please refer to the instructions ed to registrants for additional information. If you have any questions, please contact Customer Service at ext. 10.

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6 THE HISTORY OF COLOSSUS

7 7 Computer Software Program used by Insurance Companies The adjuster enters information about the claim into the program The program accesses over 10,720 rules or value drivers to evaluate over 750 injuries The program computes a settlement figure that is consistent with the severity of the patient s injury

8 8 Value drivers! There are 10,720 What are value drivers?

9 9 Colossus arrives at an evaluation by assigning points to value drivers associated with each injury.

10 10 The actual assignment of points is determined by each individual insurer. They become the baseline data by which all injury values are arrived at.

11 11 Each insurer has the ability to manipulate this point assignment and database any time it wishes.

12 12 The points are represented by value drivers in a mathematical equation.

13 13 Some of the value drivers have multipliers as well. These multipliers add significant points to each value driver.

14 14 The mathematical equation consists of the following components, which must be indicated in the medical records and be specifically stated in the demand from the attorney

15 15 What Caused The Cultural Change In the Insurance Industry? The Insurance Industry claim handling culture went through a major transformation during the mid 1990 s adopting the opinions and advice of McKinsey Consulting.

16 16 THE MEDICAL COMMUNITY ENVIRONMENT This was accomplished by each individual insurer in conjunction with McKinsey Consulting (Arthur Anderson or Accenture as it is currently known, also contributed to some insurers transformation) through the creation and implementation of the McKinsey Business Process Improvement (BPI) culture. This transformation of claim culture is evident in the McKinsey documents Allstate has produced in other cases across the country.

17 17 Soft Tissue Injuries The current industry percentage of these claims which would involve soft tissue injuries varies between 85 and 90 percent. The most common treating facility or practitioner sought for the treatment of soft tissue injuries is Chiropractic. The current industry percentage of Chiropractic involvement in these types of claims is as high as 95%. Most of the injured parties have either PIP/MPC benefits available to pay for the treatment. A very significant number of the injured parties also have either third party claims against an insured negligent tortfeasor or a first party claim under their UM/UIM (Uninsured Motorist/Underinsured Motorist) coverages.

18 18 THE CONTINUUM COMPANY At about the same time, an Australia based computer software company creates Colossus. Designed to evaluate claims based on: - Injuries - Treatment Specifics - Symptomology - Future need for Treatment - Impairments and Disabilities

19 19 COMPUTER SCIENCE CORPORATION Licensed Colossus from the Australian Firm (Continuum Company) CSC offered it to the insurance industry as a way of reducing claim payouts McKinsey approved the venture and was retained by each of the insurers to calibrate the values of Colossus. Calibration was performed by Arthur Anderson or A.K.A. as Accenture

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22 22 COLOSSUS IS MORE THAN JUST A SOFTWARE PROGRAM It is an Artificial Intelligence Program!

23 23 How Can The Artificial Intelligence Affect Your Office? Colossus & National Insurance Crime Bureau (NICB) They use this system for all doctors prior accidents, questionable cases, referrals, tax ID s, SS#, looking for patterns

24 24 Colossus The Colossus equation is designed to establish: Economic Damages or Special Damages Medical Bills & Loss of Income Non Economic Damages or General Damages Pain & Suffering What does this mean?

25 25 UNTIL THE LATE 1980 S Most claims were settled for 3-5 times the special damages For example: - $5000 in specials settled at $15000

26 26 Colossus Therefore each INJURY MUST BE IDENTIFIED BY A QUALIFIED DOCTOR Example: If the patient had a sternum injury at the ER and it does treating facility does not recognize or diagnose that injury the claims representative is barred from imputing that additional injury. The result would have an impact on the final value of the claim.

27 27 66% savings The case reserve in 1990 for a soft tissue injury liability claim was approximately $15, The case reserve for the same type of injury in 2001 was $5, This reduction in the claim severity was a direct result of the process and programs such as MIST, Minor Impact and No Damage / No Injury. This $10, savings per claim has a direct impact on profits realized from the claims department. This is the amount of dollars set aside by the insurer in anticipating the amount to paid on this type claim at settlement. The figure is based on a three year historical severity realized by the insurer. Fowler vs. State Farm Mutual Automobile Insurance Company, Hawaii; The United States District Court For the District of Hawaii; Civil No. CV SPK/KSC;

28 28 66% savings Considering that State Farm Claim Vice President (Fowler vs. State Farm) recently stated in a deposition. State Farm experiences 15,000 claims per day. It might be an eye opening exercise to have some economist actually extrapolate the direct and indirect economic impact on the public over the last fifteen years. This is the amount of dollars set aside by the insurer in anticipating the amount to paid on this type claim at settlement. The figure is based on a three year historical severity realized by the insurer. Fowler vs. State Farm Mutual Automobile Insurance Company, Hawaii; The United States District Court For the District of Hawaii; Civil No. CV SPK/KSC;

29 29 THE ARTIFICIAL INTELLIGENCE OF COLOSSUS Begins with database profiling - Chiropractors - Medical Doctors - Patients

30 30 DOCTORS HAVE BEEN DATABASED If Colossus devalued most of your cases last year because: - You look poor notes - Failed to refer for a second opinion - Used the wrong terminology - Used the wrong prognosis - Did not objectify your findings with diagnostics - Did not monitor clinical progression with Outcomes Assessments - Did not use active care procedures Then

31 31 UNDERSTANDING IS THE KEY If Attorneys, Medical Doctors, Chiropractors understand Colossus and work within its framework, then Colossus can be beat. We can win the whole pot even though we are holding a bad hand

32 32 The Entire Case Is Calculated From The Treating Physicians Records And Protocols. Attorney Demand Packages Are Obsolete!

33 33 What Are Our Clinical Tools Flexion / Extension Views Lateral Flexion Open Mouth Digital Motion X-Ray Proton Density MRI ( Upper Cervical Studies ) AMA Guides For Permanent Impairment

34 34 Soft Tissue Injuries and the Attack by the Insurance Companies Most Chiropractors treat Soft Tissue Injuries Our office looks at ALL ANATOMICAL STRUCTURES. CONNECTIVE TISSUE 95 % of all Soft Tissue cases are treated by Chiropractors

35 35 All Injuries Must Be Identified Contusions all other body parts Sprain/Strain all other body parts Fracture all other body parts Dislocation all other body parts Ligament injuries usually associated with joints Laceration all other body parts Penetrating wounds all other body parts Crush wounds all other body parts Amputation all other body parts Concussion Lastly, dental injuries

36 36 All Injuries Must Be Identified Sprain/Strain cervical, thoracic and/or lumbar Subluxation Prolapse cervical, thoracic and/or lumbar Bulge cervical, thoracic and/or lumbar Herniation cervical, thoracic and/or lumbar Dislocation cervical, thoracic and/or lumbar Fracture cervical, thoracic and/or lumbar Superficial Injuries all other body parts

37 37 Do You Know The Four IV Phases Of Whiplash? The s-shaped curve, with hyperextension of the lower segments and flexion of the upper segments. This is one of the chief points of injury and occurs before the head strikes the head restraint. Adapted from Ono et al.

38 IV Phases You Should Know 38

39 39 UNDERSTANDING THE EQUATION No human intuitive abilities Depends on the input of the claim handler alone Garbage In Garbage Out

40 40 IN THE ABSENSE OF COMMUNICATION, THE PATIENT IS THE VICTIM We need to speak the language of Colossus - Symptoms - Diagnosis - Treatment - Prognosis - Additional Factors - Impairment

41 41 Permanent Impairment Permanent Impairment is defined with the following factors A medical condition resulting from trauma or work related disease or illness A deviation from normal function of a body part or organ system Something the body or body part can no longer perform normally

42 42 How does permanent impairment differ from Disability? Disability is how the impairment affects and changes the person s ability to perform, social, or employment demands Impairment is a medical assessment Disability is a non-medical assessment NOTE: Colossus is not capable of establishing an impairment rating, only a qualified medical physicians can assess impairment ratings.

43 43 Colossus Colossus is NOT capable of assessing brain damage The only head injury impairments, which may be entered into colossus are related to sight, hearing, equilibrium, air passage, or mastication (TMJ)

44 44 Colossus Colossus Applies General Damage Compensation For Impairments Based On The Following: The Body Part Or System Impaired The Degree (Amount) Of The Impairment Assigned By The Medical Examiner Impairment Ratings Must Be Part AMA (American Medical Association) 6 th Edition For NOW Law Suit Pending

45 45 Injuries Diagnosed & Treated Minimum Competency To treat PI Patients The Doctors Ability to Address Each & Every Injury

46 46 PROPER AND COMPLETE DIAGNOSIS The Initial Records Must Reflect ALL Complaints Of The Patient The Examination Should Indicate All Injuries Related To Each Complaint Colossus Is Structured To Recognize Only The Diagnosed Injuries Found In The Records

47 47 DIAGNOSE ALL INJURIES SEPARATELY!!!!!! If the shoulder is included as a separate injury then the colossus program would allow additional treatment for the shoulder. Although radiating pain increases the value of the case, it does not increase it as much as diagnosing the symptom as a separate injury.

48 48 CPT Codes Using forms that contains CPT codes is huge for your case for 2 reasons. It helps the office biller work more quickly AND helps the Colossus data entry person work more quickly to settle the claim. Keeping good medical records makes the claim adjuster and all attorneys jobs easier because they have all the facts to know what injuries were diagnosed.

49 49 Intake and Management Forms Attorney Intake Form DUD and LOE Worksheets Physician Intake/Discharge Form Physician Request Form Common Injury Code Sheet Supplemental HCFA Form Body Shop Questionnaire

50 50 DOCUMENTATION OF ALL SYMPTOMS After the injuries (diagnosis) are inputted, colossus asks a series of questions associated with each injury. The corresponding input adds individual value amounts to the claims general damage range.

51 51 IMPORTANT SYMPTOMS Loss of range of motion Headaches Spasms Dizziness Visual disturbance Radiating pain Anxiety (must be treated) TMJ Stiffness

52 52 SYMPTOM DURATION It is not necessary to acknowledge the symptom on each date of treatment However, the entire duration of the symptom should be reflected in the chart notes.

53 53 PRE EXISTING CONDITIONS If a plaintiff has a pre-existing condition, Colossus will place a higher value on the claim An asymptomatic condition with no treatment in the past 24 months. Even a condition that was symptomatic there is a need for clinical discussion.

54 54 TREATMENT DELAY AND/OR TREATMENT GAPS Any delay in seeking treatment or any gaps in the treatment regimen must be substantially explained in the records. Either of these situations unexplained would result in decreasing the weight of the treatment duration.

55 55 THE PROGNOSIS NEVER MENTION THE TERM MMI FOR WHOLE BODY ONLY EACH BODY PART AFFECTED Resolution Undetermined No Value No Complaints, No Further Treatment - Complaint, No Further Treatment - Complaint, Further Treatment - Complaint, Guarded Prognosis -

56 56 ADDITIONAL FACTORS There are three additional factors which have significant weighted affected on the general damage portion of a claim. - Duties Under Duress - Loss of Enjoyment of Life

57 57 In summary... Firms need to be proactive Medical and Chiropractic institutions do not train doctors to manage personal injury clinically or case manage wise.

58 58 In summary... Go to For your Complimentary Colossus Guide & Colossus Firm Assessment

59 Dr. Matthew J. DeGaetano Certified Colossus Consultant Personal Injury Institute 363 West Main Street Lewisville, TX Steven M. Gursten Attorney Michigan Auto Law Northwestern Highway Farmington Hills, MI