This week in comp, October 21, 2016

This week in comp is a weekly digest of workers’ compensation news from around the country.

Safety

OSHA delays anti-retaliation component of electronic reporting rule
OSHA has delayed enforcement of the anti-retaliation component of its new electronic injury and illness reporting rule until Dec. 1, 2016. The component was schedule to go into effect November 10…MORE

Fall protection again tops list of most frequently cited OSHA standards

OSHA requires staffing agencies and host employers to share responsibility for keeping temporary workers safe.

Texas Mutual encourages employers to follow these 10 tips to survive an OSHA audit.

Fall protection tops the 2016 list of most frequently cited OSHA standards, followed by hazard communication and scaffolds. OSHA recommends employers who want to improve workplace safety use the list as a starting point…MORE

Does your medication affect your driving?
Few would argue that driving under the influence of alcohol, cocaine, marijuana and other street drugs is dangerous. But did you know over-the-counter and prescription drugs can also affect your ability to drive safely? The AAA Foundation launched a website that teaches you how your medications might affect you and your driving…MORE

7 common workplace violence prevention mistakes
Workplace violence policies should be written at an 8th grade level to accommodate all workers. Violence prevention training should be interactive, teaching employees to recognize threats and respond appropriately, according to the CEO of Violence Free…MORE

Underwriting

California, New Jersey register highest workers’ comp rates
Workers’ comp rates in California and New Jersey are 188 and 158 percent above the national median, respectively. North Dakota registers the lowest rates at 48 percent below the median, according to an Oregon Department of Consumer and Business Services report…MORE

Fraud

Your RX for health care fraud

Doctors, patients, employers and insurance carriers are among the stakeholders who can commit health care fraud.

Doctors, patients, employers and insurance carriers are among the stakeholders who can commit health care fraud.

The Coalition Against Insurance Fraud estimates health care fraud steals tens of billions across all lines of insurance annually. Employers can protect their business from fraud by following a few simple tips…MORE

Ten Texans added as defendants in
$100 million compounding drug scheme
A superseding indictment alleges that from approximately May 2014 to mid-February 2016, 12 defendants conspired to run a scheme to defraud TRICARE in connection with the prescription of compounded pain and scar creams. The scheme involved kickbacks to TRICARE beneficiaries, prescribing physicians and marketers by the owners of compounding pharmacies…MORE

Claims

New Texas ‘two-step’ program aims to simplify workers’ comp disputes
Under a new Texas Department of Insurance, Division of Workers’ Compensation program, hearing officers can decide the most far-reaching disputed claim issues first, clearing the way for secondary issues to be resolved sooner. Hearing officers will only use the two-step approach if both parties agree…MORE

Cyber security

Cyber claims continue to be costly

The average data breach costs $665,000.

The average claim payout for a data breach is $357,000, and insiders are involved in 30 percent of cases.

The average data breach claim for a large company is almost $6 million, according to a new study. While large companies continue to be targeted, the majority of claims are for organizations with less than $2 billion in revenue…MORE

Opioid epidemic

DEA cuts opioid production 25 percent
The Drug Enforcement Administration (DEA) has reduced by 25 percent the amount of almost every Schedule II opiate and opioid medication that may be manufactured in the United States in 2017. The DEA sets manufacturing quotas to ensure adequate supply for legitimate medical purposes while limiting the amount available for diversion. A recent study found that 6.5 million Americans used controlled substances for non-medical purposes during the past month…MORE

A look inside the workers’ comp market’s opioid problem
Opioids are costly and addictive, and research suggests they could exacerbate pain. Alternative therapies, such as occupational therapy, physical therapy and nerve blockers can be safer and more effective from a cost and treatment perspective…MORE

 

 

 

Your RX for health care fraud

Imagine visiting a clinic for a work-related injury and being treated by a foreign medical student who is not authorized to practice medicine in the United States. That’s what happened to patients at Rose’s Houston Healthcare Clinic.

Rosemary Phelan, the clinic’s owner, pleaded guilty to insurance fraud-related charges in the wake of a joint investigation between Texas Mutual Insurance Company and the Texas Department of Insurance.

“Fraudulent behavior not only harms the individual company but also places an unnecessary financial burden on all participants in the workers’ compensation system.” Tim Riley, vice president of special investigation at Texas Mutual

Phelan was sentenced to seven years’ deferred adjudication and ordered to pay $88,000 in restitution. But the fallout from fraud can be far-reaching and far more serious than any penalty levied by a court.

Most importantly, Phelan jeopardized patients’ health by staffing her clinic with unlicensed physicians. And then there are the monetary costs of fraud, which affect everyone in the form of higher premiums.

State regulators and insurance carriers are working hard to stop health care fraud. In fact, Texas Mutual maintains a team of investigators who specialize in protecting our policyholders’ premium dollars from the trickle down effects of health care fraud. You can do the same for your business if you learn what to look for and how to respond.

Common schemes
The National Health Care Anti-Fraud Association estimates the financial losses due to health care fraud are in the tens of billions of dollars each year. Here are some common fraud schemes Texas Mutual investigators have seen:

  • Up-coding involves submitting bills for more serious or expensive diagnoses or procedures than were actually performed.
  • Unbundling means marketing or charging for items or services separately rather than as a package.
  • Prescription drug diversion is increasingly common in the midst of America’s opioid epidemic. Diversion means abusing or illegally distributing prescription drugs, or using them for purposes not intended by the prescriber.
  • Unnecessary treatment, supplies and tests, also known as overuse, is particularly egregious because it also affects patients’ health. The Lowe Institute estimates overuse accounts for between 10-30 percent of U.S. health care spending.

Red flags
Employers can help fight fraud if they know what to look for. Here are some common red flags for health care fraud:

  • The employer receives a notice that a claimant has changed his/her treating doctor and is then taken off work after receiving a release to return to modified or full duty. Usually, the claimant also seeks attorney representation.

    Employers who commit premium fraud get an unfair advantage over honest competitors.

    The Coalition Against Insurance Fraud estimates health care fraud steals tens of billions across all lines of insurance annually.

  • The treating doctor extends off-work status without treating the claimant for an extended time. For example, the doctor documents that the claimant should remain off work until the next office visit, which is scheduled one to two months after the date of service.
  • The health care provider uses templated documentation, which means using the same language on medical reports for all patients. You may notice that the report does not have the claimants’ correct name or that the gender references do not match. This is a red flag because it could signal that the physician is not truly evaluating patients or spending the amount of time they billed for.
  • The health care provider uses rubber-stamped signatures on DWC-73/office visit reports. This indicator could point to a provider billing for services he/she did not actually perform.
  • The claimant complains about the health care provider’s services or the treatment facility’s conditions. For example, the claimant might report that the office clerk performed the treatment or the clinic was dirty and did not have the appropriate therapy equipment.
  • Claimants complain that they are ready to return to work, but the doctor keeps them in an off-work status and continues to order treatment such as physical therapy.

Reporting suspected fraud
Investigators acknowledge three types of workers’ compensation fraud: claimant fraud, premium fraud and health care fraud. All steal money from the workers’ comp system and honest stakeholders. If you suspect fraud in a claim, contact your insurance carrier and/or the Texas Department of Insurance fraud unit.

Protect yourself against health care fraud

Identity theft and Social Security card

About 2.3 million Americans spent an average of 200 hours and $13,500 to resolve medical ID theft cases in 2014.

Imagine someone offering you the chance to get cutting-edge genetic tests for cancer and other serious diseases at no cost to you. For just a few hours of your time, you walk away with peace of mind and a $50 Walmart gift card.

If you’re thinking it sounds too good to be true, you’re probably right.

A large group of unsuspecting Central Texans recently fell victim to this scam. When reporters began investigating the scam, they found the “clinics” boarded up and the saliva samples discarded in a shed.

Like workers’ comp fraud, health care fraud comes in many forms. In some cases, perpetrators bill for services they never provided. In other cases, they overbill for services or provide services patients don’t need. In all cases, the costs trickle down to consumers in the form of higher premiums.

You can protect yourself from health care fraud by following these simple tips:

  • Guard your health insurance information. More than 2 million Americans fall victim to health care identity theft every year. Protect yourself by guarding your health care information the same way you guard your Social Security number, your credit card numbers and your internet passwords. Never give your medical ID card information to a stranger on the phone, in an email or on a website.
  • Review your statements. Review your bills and explanation of benefits to make sure you and your health plan were only charged for services you received. If you see errors, contact you plan’s customer service center or the provider.
  • Ask questions. Ask questions to make sure the treatment your doctor recommends is necessary. Be skeptical if a doctor recommends a new, unusual or experimental procedure.
  • Remember that nothing is free. Don’t accept offers of money or gifts in exchange for your medical ID or other personal information. While many research studies are legitimate, they should never ask for your medical ID or submit claims to your health plan.
  • Report your suspicions. If you suspect someone is trying to lure you into a health care scam, contact your plan’s customer service center, your employer’s human resources department or the Texas Department of Insurance fraud line at (800) 252-3439.

For more information on medical ID theft, visit the Texas Department of Insurance fraud unit online.

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