Monitoring Trends in the New York Workers’ Compensation System

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The metrics in this WCRI report provide the information necessary to observe the possible effects of some of the 2007 legislation and related administrative changes to the new York workers' compensation system.

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The regular monitoring of system performance helps policymakers and system stakeholders focus attention on the objectives that are being met, objectives that are not being met, and any unintended consequences that have emerged.

Trends in the performance of the New York workers’ compensation system following reforms enacted in 2007 are monitored in the eighth annual report from the Workers Compensation Research Institute (WCRI).

The metrics in this report, Monitoring Trends in the New York Workers’ Compensation System, 2005–2013, provide the information necessary to observe the possible effects of some of the 2007 legislation and related administrative changes.

The data that underlie some of the measures in this report are of sufficient maturity to begin to see changes in some of the metrics addressed by the statutory revisions and other changes. It is important to note, however, that it will still be several more years before the full impact of the reforms will be realized.

“The regular monitoring of system performance helps policymakers and system stakeholders focus attention on the objectives that are being met, objectives that are not being met, and any unintended consequences that have emerged,” said Ramona Tanabe, executive vice president and counsel for WCRI.

The following are among the study’s findings:    

  • Medical Treatment Guidelines: In 2011 claims evaluated in 2012 (reflecting 16 months of experience under the treatment guidelines), the number of visits per indemnity claim decreased for chiropractors and physical/occupational therapists when compared with the prior year, while there was little change for physicians.
  • Increase in Indemnity Payments per Claim: From 2007 through 2009, indemnity payments per claim increased at double-digit rates at all claim maturities. Since 2009, indemnity payments per claim continued to grow, at about 6 percent per year for claims at 12 months of experience and somewhat faster (7-9 percent per year) at the longer claim maturities.
  • Duration Limits on Permanent Partial Disability (PPD) Benefits: From 2007 to 2011, for PPD/lump-sum cases at an average 36 months of experience, there was a 14 percentage point decrease in cases that received PPD payments only (with no lump-sum payment) and a nearly corresponding 13 percentage point increase in cases with a lump-sum settlement only (with no PPD payments). This may suggest earlier settlements for some types of cases. Over that same period and claim maturity, the average PPD/lump-sum payment increased at double-digit rates in most years for cases with only a lump sum and for cases with both PPD payments and a lump-sum settlement. We observed similar patterns in PPD/lump-sum frequency and payments by type at other claim maturities.    
  • Diagnostic Testing and Networks: Raising the dollar threshold from $500 to $1,000 for prior authorization of physician-ordered diagnostic medical tests was aimed at reducing hearings over the medical necessity for these services. From 2007 to 2013 for claims at 12 months of experience, we observed little change on average in the number of visits for major radiology services by nonhospital providers.
  • “Rocket Docket”: There was little change in the average defense attorney payment per claim in 2010, but an increase of nearly 10 percent per year from 2011 to 2013 for claims at 12 months of experience.

The study uses open and closed indemnity and medical-only claims with dates of injury from October 2004 through September 2013, with experience as of March 2014. The data are representative of the New York system.

Click on the following link to purchase a copy of this study: http://www.wcrinet.org/result/ny_reforms_8_result.html.

ABOUT WCRI:

The Workers Compensation Research Institute (WCRI) is an independent, not-for-profit research organization based in Cambridge, MA. Organized in late 1983, the Institute does not take positions on the issues it researches; rather, it provides information obtained through studies and data collection efforts, which conform to recognized scientific methods. Objectivity is further ensured through rigorous, unbiased peer review procedures. WCRI's diverse membership includes employers; insurers; governmental entities; managed care companies; health care providers; insurance regulators; state labor organizations; and state administrative agencies in the U.S., Canada, Australia and New Zealand.

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Andrew Kenneally
Workers Compensation Research Institute
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