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Workers’ Compensation Claim and Professional Medical Service Denials: An Examination of 1998-2004 Trends. Texas Department of Insurance Workers’ Compensation Research and Evaluation Group June 2006. This Presentation Will Highlight:. Initial Claim Denials/Dispute Trends
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Texas Department of Insurance
Workers’ Compensation Research and Evaluation Group
June 2006
Initial Claim Denials/Dispute Trends
1 The top 25 workers’ compensation insurance carriers represent the 25 insurance carriers/carrier groups that account for over 90 percent of the workers’ compensation premiums in 2003 and 2004 and account for 60-70 percent of the total amount of medical payments made during 1998-2004. For the purpose of this analysis, the same 25 insurance carriers were used in each year to calculate both the claim and medical billing denial rates.
Professional Medical Service Denials Trends
1 The Top 25 Workers’ Compensation Insurance Carriers represent the 25 insurance carriers/carrier groups that account for over 90 percent of the workers’ compensation premiums in 2003 and 2004 and account for 60-70 percent of the total amount of medical payments made during 1998-2004. For the purpose of this analysis, the same 25 insurance carriers were used in each year to calculate both the claim and medical billing denial rates.
Initial Claim Denial/Dispute Trends
Initial Claim Denial/Dispute Trends
Professional Medical Service Denials Trends
Source: Texas Department of Insurance, Workers’ Compensation Research and Evaluation Group, 2006.
1The 2004 figures should be interpreted with caution since the data are incomplete.
2 House Bill (HB) 2600, a workers’ compensation reform bill aimed at reducing medical costs was passed in 2001.
Figure 1: Percentage of Reportable Claims That Are Initially Denied/Disputed for the Top 25 Workers’ Compensation Carriers, Injury Years 1998-20041, 2
Source: Texas Department of Insurance, Workers’ Compensation Research and Evaluation Group, 2006.
1The 2004 figures should be interpreted with caution since the data are incomplete.
2 House Bill (HB) 2600, a workers’ compensation reform bill aimed at reducing medical costs was passed in 2001.
Source: Texas Department of Insurance, Workers’ Compensation Research and Evaluation Group, 2006.
1 The number of carriers in the low denial level categories range from 6-8 for 1998-2004, the number of carriers in the
medium denial level categories range from 9-13 for 1998-2004 and the number of carriers in high denial level categories range
from 6-10 for 1998-2004.
2 The denial categories were defined using the yearly denial rate distributions for the top 25 workers’ compensation carriers in 2003 &
2004. For each service year, carriers whose denial rate fell at or below the 25th percentile of the denial rate distribution were assigned
into the “low” denial category, carriers whose denial rate fell at the 26th-74th percentile of the denial rate distribution were assigned
into the “medium” denial category, and carriers whose denial rate fell at or above the 75th percentile of the denial rate distribution
were assigned into the high denial category. Carriers could fall into a different category each injury year.
3 The 2004 figures should be interpreted with caution since the data are incomplete.
4 House Bill (HB) 2600, a workers’ compensation reform bill aimed at reducing medical costs, was passed in 2001.
Source: Texas Department of Insurance, Workers’ Compensation Research and Evaluation Group, 2006.
1 The injury year or region could not be identified for approximately 19% or 87,405 of denied claims and are therefore not reflected in the figures presented above.
2 The 2004 figures should be interpreted with caution since the data are incomplete.
3 House Bill (HB) 2600, a workers’ compensation reform bill aimed at reducing medical costs, was passed in 2001.
Source: Texas Department of Insurance, Workers’ Compensation Research and Evaluation Group, 2006.
1 The injury year or type could not be identified for approximately 19% or 87,405 of denied claims and are therefore not reflected in the figures presented above.
2 The 2004 figures should be interpreted with caution since the data are incomplete.
3House Bill (HB) 2600, a workers’ compensation reform bill aimed at reducing medical costs, was passed in 2001.
Initial Claim Denials/Disputes
Figure 2: Total Number of Professional Medical Services and Percentage of MedicalServices Denied for the Top 25 Workers’ Compensation Carriers for Service Years 1998-2004 1, 2
Source: Texas Department of Insurance, Workers’ Compensation Research and Evaluation Group, 2006.
1 Denial rates and billing line counts for 2004 should be interpreted with caution since these number are tentative and are
current as of February 2005.
2 House Bill (HB) 2600, a workers’ compensation reform bill aimed at reducing medical costs, was passed in 2001.
In August 2003, the most recent professional medical fee guideline, which incorporated Medicare’s
payment policies, went into effect.
Source: Texas Department of Insurance, Workers’ Compensation Research and Evaluation Group, 2006.
1 The number of carriers in the low denial level categories range from 6-9 for 1998-2004, the number of carriers in the
medium denial level categories range from 9-11 for 1998-2004 and the number of carriers in high denial level categories range
from 7-8 for 1998-2004.
2 The denial categories were defined using the yearly denial rate distributions for the top 25 workers’ compensation carriers in 2003 &
2004. For each service year, carriers whose denial rate fell at or below the 25th percentile of the denial rate distribution were assigned
into the “low” denial category, carriers whose denial rate fell at the 26th-74th percentile of the denial rate distribution were assigned
into the “medium” denial category, and carriers whose denial rate fell at or above the 75th percentile of the denial rate distribution
were assigned into the high denial category. Carriers could fall into a different category each professional medical service year.
3 The 2004 figures should be interpreted with caution since these number are tentative and are current as of February 2005.
4 House Bill (HB) 2600, a workers’ compensation reform bill aimed at reducing medical costs, was passed in 2001. In August 2003, the most recent professional medical fee guideline, which incorporated Medicare’s payment policies, went into effect.
Table 5: Percent and Number of Professional Medical Service Denials for the Most Frequently Billed Professional Medical Services in 2003 1,3
Source: Texas Department of Insurance, Workers’ Compensation Research and Evaluation Group, 2006.
1 The “most frequently billed medical services” are defined as the services most frequently billed in 2003.
2 Denial rates for 2004 should be interpreted with caution since these numbers are tentative and are current as of February 2005.
3 House Bill (HB) 2600, a workers’ compensation reform bill aimed at reducing medical costs, was passed in 2001.
In August 2003, the most recent professional medical fee guideline, which incorporated Medicare’s payment policies, went into effect .
Source: Texas Department of Insurance, Workers’ Compensation Research and Evaluation Group, 2006.
1 The “most costly medical services” are defined as the services with the highest total amount billed during 2003.
2 Denial rates for 2004 should be interpreted with caution since these numbers are tentative and are current as of February 2005.
3 House Bill (HB) 2600, a workers’ compensation reform bill aimed at reducing medical costs, was passed in 2001.
In August 2003, the most recent professional medical fee guideline, which incorporated Medicare’s payment policies, went into effect .
Source: Texas Department of Insurance, Workers’ Compensation Research and Evaluation Group, 2006.
1House Bill (HB) 2600, a workers’ compensation reform bill aimed at reducing medical costs, was passed in 2001.
Source: Texas Department of Insurance, Workers’ Compensation Research and Evaluation Group, 2006.
1 The 2004 figures should be interpreted with caution since these numbers are tentative and are current as of February 2005.
2 “Other reasons” include “not timely filed”, “not treating doctor”, “inappropriate health care provider”, “final adjudication”, preauthorization requested, but denied”, etc.
3 House Bill (HB) 2600, a workers’ compensation reform bill aimed at reducing medical costs, was passed in 2001.
In August 2003, the most recent professional medical fee guideline, which incorporated Medicare’s payment policies, went into effect .
Professional Medical Service Denials
Professional Medical Service Denials, cont.
Professional Medical Service Denials, cont.