On Tuesday, the American Insurance Association (AIA) testified before the Maryland Senate Finance Committee in support of critical workers’ compensation legislation that would reportedly enable Maryland – like neighboring states Pennsylvania and Virginia – to realize significant benefits for both injured workers and overall system costs.
This legislation (Senate Bill 466) would permit employers and insurers to provide for more appropriate, cost-effective medical treatment of injured workers by establishing panels of health care providers from which claimants would choose their primary physician.
Ken Stoller, AIA counsel, testified that, “A key objective in delivering workers’ compensation medical benefits is to ensure that injured workers are treated by qualified, competent health care providers. Equally important is ensuring that workers are not treated by providers who either are inadequately trained or have demonstrated a lack of concern for the need to provide necessary and appropriate medical services in a cost-effective manner.”
According to AIA, in Maryland, injured workers are currently permitted to seek medical treatment without any guidance or input from employers and insurers. Prohibiting employers and insurers from participating in this vital aspect of an injured worker’s care severely hinders their ability to improve the quality of that care, halt inappropriate treatment, and/or ensure the worker’s prompt, successful return to work. Research conducted on a nationwide level has confirmed that directing injured workers to receive medical services from providers selected by employers or insurers can significantly reduce system costs without adversely affecting disability and time away from work.
“According to a 2002 study by the Workers’ Compensation Research Institute (WCRI), medical costs are 7 percent to 10 percent lower in states where the employer controls selection of medical providers,” Stoller explained. “It is therefore not surprising that the National Council on Compensation Insurance (NCCI), which analyzes and prices workers’ compensation legislation in many states, has indicated that adoption of SB 466 would result in a reduction in medical costs of 5 percent to 10 percent, translating into an overall system cost reduction of between 2.2 percent and 4.3 percent. In actual dollars, this would represent savings of between $16.5 million and $32.3 million.”
Maryland’s Workers’ Compensation Act requires the employer or its insurer to promptly furnish injured claimants with medical care for as long as it is required by the nature of the injury or disease. Enabling employers and insurers to establish panels of duly licensed health care providers will not reportedly in any way diminish the quality of care received by Maryland’s workers.
“Providing the injured worker with high quality, cost-effective health care that permits prompt, successful return to work is clearly in the best interest of all parties to a workers’ compensation claim,” Stoller added.
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