By: Michael Pierson

Providers who are new to workers’ compensation need to understand how the workers’ comp claim process works from the time an employee is injured to the time when they are healed and returned back to the pre- accident base line as best as possible.

This article is intended to help providers understand the workers’ compensation process and all the people and or organizations that are involved in a workers’ compensation claim.  It is important to understand that each and every state has its own workers’ compensation laws so one size does not fit all. We have to learn the rules and regulations that apply in any particular state. The article will provide a step by step analysis of claims and its progress through the workers’ compensation process. Please keep in mind this is provided in general terms and not specific to any one state

Workers’ Compensation Definitions

If you are going to be in the workers’ compensation arena, you need to understand some of the common terms/ abbreviations used in work comp.

• IE= Injured employee
• OOW= Out of work
• RTW= return to work
• TPA= Third Party Administrator
• MCO= Managed Care Organization
• NCM= Nurse Case Manager
• FCE= Functional Capacity Evaluation
• MMI= Maximum Medical Improvement
• IME= Independent Medical Exam
• NTT= Need to Treat exam
• Petitioner= Legal term for the injured employee (case is in Litigation)
• Respondent= Legal term for the employer

Insurance Carrier vs. TPA

 An Insurance carrier is one where an employer pays a premium to have an insurance carrier handle its claims. Generally, the insurance carrier makes all decisions on claim handling. A TPA is a firm that is hired to handle claims and administrative tasks on behalf of an employer who may be self- insured like a municipality, School Board, hospital system, or union.  In some instances, Insurance carriers have also hired TPA’s to handle its claim program.

The Accident

When an employee gets injured at work, they report the injury to their employer.  It can be a supervisor, HR manager or other person who is responsible for taking down the information.  The injured worker may complete an initial injury report which is generally called a first report of injury. The injury must occur in the course and scope of one’s employment. This means that the injury occurred at the place of employment and it occurred while performing a work activity that benefits the employer.

The employer then reports the injury to its workers’ compensation carrier or Third Party Administrator for investigation and handling of the claim. The adjuster reviews the claim to be sure coverage is in force and that the accident was in the course and scope of the employee’s employment. Once that is confirmed medical treatment is authorized by the adjuster. In some situations, the employer reports the injury directly to a managed care organization who works closely with the carrier or TPA to manage the medical portion of the claim.

Treatment

The employer, carrier, TPA or managed care organization can refer the injured employee to an authorized medical provider.  In some situations, a Managed Care organization (MCO) is hired by an employer, TPA, or carrier to direct medical care ensuring that the provider understands workers’ compensation statutes in that particular state and that causality is properly addressed. In some situations, the claim adjuster is responsible for directing care. Some states provide for lifetime control of medical by an employer or carrier.  In other states, authorized medical care is limited to a certain period of time such as 90 days after which the employee can seek treatment by anyone, he/she desires.  In other states the employee can seek treatment from any provider they desire from the start. In some jurisdictions, the employee can go to whomever they want for treatment; again, it all depends on the state law of how medical care is provided. 

Health vs. Workers’ Compensation Coverage-The Paperwork Trail

Under health insurance, a patient comes into your practice and you secure a copy of his/her health insurance card and Identification. They fill out health insurance forms and then the patient is treated and the billing is submitted to the health carrier. The insurance representative at the health carrier confirms coverage, CPT codes and charges and pushes a button to process the claim for payment in accordance with your contract with that carrier. You collect any deductibles or co-payments from the patient and in some cases with high deductibles such as $1,500, you may have to follow up on open account receivables from the patient.

In workers’ compensation, the injured employee comes to your office, provides identification, completes your intake forms and they should also complete a separate workers’ compensation questionnaire that describes how they were injured, what body parts were injured and what other prior injuries they have had as well as other accidents or injuries they may have had in the past. In workers’ compensation, there are more forms to complete, more medical investigation into causality and reporting and communicating with the adjuster or case manager from the MCO as compared to health insurance. There are no deductibles or co-pays in workers’ compensation. You are paid from the first dollar for all authorized medical treatment.

Return to Work

After treating the patient, the adjuster or case manager as well as the employer may request some additional paperwork to be completed such as a work status report, sometimes called a quick note that provides what the injured worker can and cannot do and provide restrictions if any or return to full duty.  These forms may be provided to you by the organization or if not, you may be required to submit your own form, usually within 24 hours after seeing the patient.  This process may continue throughout claim process. The importance of this process is to assist the employer in determining if the injured worker can return to work or must stay out of work and for what estimated period of time. This allows the employer to understand how to continue business operations.

Billing Process

The provider submits a HCFA 1500 form with diagnosis and CPT codes and description of injury to either the adjuster at the TPA or Carrier or in some cases directly to a managed care organization depending on who is controlling the medical program along with either an office report or quick note. In one form or another the bill is processed either in accordance with a state fee schedule or if no fee schedule, under usual and customary statutes.  The bills are “re-priced” to either a contracted amount, to a fee schedule or to a percentage of Usual and customary.

Networks in Workers’ Compensation

Many insurance companies and TPA’s negotiate directly with various networks for discounted medical fees and pricing of procedures based on CPT codes. The networks offer these discounted prices to providers because of potential volume of referrals that the provider can receive through a network. Some networks also provide managed care services that can include telephonic nurse case management or field case management where a nurse actually meets with an injured employee and attends the medical appointment with the employee and talks with the provider about care and proposed treatment.  Some networks only do re-pricing of bills based on the contract they have with a provider. Some networks will only contract with a provider for both auto and workers’ compensation while others will bifurcate and allow a provider to contract just for workers’ compensation or auto.

Other Forms of Medical Treatment

In addition to being treated by an urgent care provider or specialist, an employee may be sent for physical therapy, occupational therapy, or for psychological treatment or pain management etc. depending on the facts of the injury and the necessary objective tests performed to help diagnose a problem. This may be in the form of X-rays, MRIs, EMGs, CTs, discograms or an FCE (functional Capacity Evaluation) to name a few.

Medical Examinations

 After the initial treatment at an urgent care or occupational medical center as discussed above, it may become apparent that the injured worker needs to be seen by a specialist, typically in orthopedics or pain management. The adjuster or case manager will typically refer the worker to a specialist who understands workers’ compensation and causality for additional care. It may become necessary for the carrier/TPA or case manager to initiate a request for either a need to treat or an independent medical exam or defense medical exam as it is called in some states (IME or DME). A need to treat exam differs from an IME in that a NTT exam is one where the carrier has approved a particular provider to take over the treatment of an injured worker.  This could be for several reasons such as the current provider is retiring from practice or may no longer want to treat this worker, or the adjuster feels the current provider is just continuing to treat with no end in sight.

An independent medical exam (IME) is used in workers’ compensation to determine various issues such as causality, ability to return to work, or if the worker is at maximum medical improvement or needs more treatment to name a few reasons. A permanency exam is another type of exam used to determine a percentage of permanency in those states that provide a permanency rating based on a functional loss.

Litigation

Many cases go into litigation and again each state has its own statutes as to how an injured employee can recover a monetary award per that states workers’ compensation law. In some states the deciding officer is called a judge of compensation and in others it can be called a referee. In either case they make the final determination on what is admissible as being causally related and how much the worker may receive in compensation.  Some states grant a lump sum amount while others provide for payments over a certain number of years based on a weekly payout amount. As a medical provider you may be called as a medical expert witness to come to compensation court or appear before a workers’ compensation judge or board to testify as to any treatment you rendered to the employee or if you performed an independent medical exam.  Your testimony and conclusions should be based on established medical science literature.

Some states allow for depositions while others do not and also, some states do not allow interrogatories or other discovery prior to trial.  Again, every state has its own laws and it’s important for the medical provider to understand these laws and work with any assigned counsel hired by the carrier or TPA as to what the law requires.  Keep in mind that case law changes and can become a moving target. What was allowed two years ago may have changed because of case law.

ABOUT THE AUTHOR

Michael Pierson has been in the insurance industry for over 40 years. He has worked for Insurance carriers and a Third Party Administrator (TPA) in workers’ compensation and other casualty insurance coverages. He spent 30 years with a regional TPA as Regional Vice President of Claims.  After retiring in 2012, he started MPIERSON CONSULTING, LLC where the company specializes in working with medical providers, educating them on workers’ compensation and securing access to workers’ compensation networks.  He currently devotes his practice to New Jersey but also has an understanding of workers’ compensation in neighboring jurisdictions.

My typical clients include Orthopedic surgeons, Pain Management Providers, General Surgeons, Chiropractors (who want to learn about workers’ compensation), Neurosurgeons, TPA’s, managed care companies, medical transportation companies, restoration companies and brokers/ risk managers who place the insurance.

I also work with various specialty networks for workers’ compensation and auto. In addition, I provide consulting services and seminars to providers or organizations interested in workers’ compensation. My programs are tailor made for each practice. It all depends on the needs that the provider or practice is looking for.  I help my clients navigate the workers’ compensation maze and act as a resource to help them answer the tough claim questions that adjuster’s ask them all from a claim adjuster standpoint.  It’s about effective communication in language that adjusters understand, are looking for and appreciate.

CONTACT INFORMATION 

• Michael Pierson, AIC
• Email: michael@mpiersonconsulting.com
• Phone: 732-918-8873
• Fax: 732-487-3385

By: Edward Gulko, MBA, FACMPE, LFACHE

The patient is in your office, oftentimes referred by an insurance carrier case manager. Your automatic assumption is that the carrier sent the patient to you, so you are fine doing whatever you believe the patient needs to become medically improved. That is often a reasonable assumption unless you also want to get compensated for your services and time.

The rules for getting approval to provide services and getting paid for them are different in each state. For the purposes of this discussion, we are limiting our issues to the State of New Jersey (Note: Do not apply these tips to patients from across the river otherwise know as New York. In that state, workers comp regulations are in a different universe).

As a first step, it is imperative that you complete in extreme detail the Attending Physician Request Form, which is often referred to as the MG-2 form. The form must be complete and accurate or it will be returned and you will have to start from the beginning which will cause delays for your patient. To complete is accurately you need various documents from other sources, sometimes within your own practice. You will need the following documents to properly support your treatment plans:

• All prior patient notes
• All notes from other treatment sources (e.g. Chiropractors, Physical Therapists, etc)
• Documentation of all previous treatments that were rendered
• Documentation and reports of all imaging and other diagnostic testing

Once you have completed the forms, they need to be sent to the Insurance Case Manager for review. This is in addition to the same day note that should be sent to the Case Manager every time you see the patient. That note which should provide an update on the status of the patient should be sent the same day as the visit or, at worst, within 24 hours of the visit. The office should also call the case manager to advise the case manager that the materials are being sent and should call after the material is sent to confirm that the case manager has received the material. NEVER assume that because you received a fax or email confirmation, the right person received the material.

Always document all conversations, messages, e-mails, faxes and everything communication that you have with the case manager or the case manager’s representative. Also be sure to continue to follow-up on everything. In these situations ‘no news’ is NOT ‘good news’. 

ABOUT THE AUTHOR

Edward Gulko, MBA, FACMPE, LFACHE is currently a practice management consultant and interim CEO in the field of medical practice management.   He currently serves as Executive Director of Englewood Spine Associates.  He previously was the Administrator of Premier Pain Centers and Specialty Anesthesia Associates in Shrewsbury, NJ which provided both independent pain management care and anesthesia services to free-standing ambulatory surgical centers.  Prior to Premier Pain he was the Executive Director of Englewood Orthopedic Associates, an orthopedic group in Englewood, New Jersey. He has expertise in the field of medical practice management and is a published author on topics such as business and clinical operations in medical practice management. Mr. Gulko is a Fellow of the American College of Medical Practice Executives and the American College of Healthcare Executives. He has served as a Part-time Lecturer at Rutgers University and on the faculty of the Congress on Administration of the American College of Healthcare Executives and has also spoken at the Annual National meeting of the Medical Group Management Association. He is a past President of the NJ Medical Group Management Association and is a past President of the Orthopedic Practice Assembly of the Medical Group Management Association. He served as a US Naval Reserve Medical Service Corps officer, retiring after twenty-one years of service.

In today’s increasingly complex workers’ compensation landscape, physicians are often the silent stakeholders—tasked with treating injured workers, navigating evolving guidelines, and balancing clinical judgment with regulatory demands.  Yet, despite their central role, many medical professionals feel disconnected from the wider Work Comp ecosystem.  Or, they have no voice and no one to help with even basic things – like information on insurers and medical networks in their state and networking and Q&A and more.

That’s where the AAWCP steps in.

The American Academy of Workers’ Compensation Physicians exists to ensure that doctors are informed, supported, and connected.  We offer:

• State-Specific Data – we can provide data on Work Comp in your state – including insurers, claims companies, medical networks and more
• Answers – Get help with day-to-day Work Comp questions and operational challenges
• Professional Connections – Network with peers, share best practices, and strengthen your referral pipeline
• Real-World Support – we can help with contact information at Insurers, Managed Care Companies and more.  And, provide support (or find it) for you for other items.  Our goal is to help make your Work Comp practice easier to manage

Physicians are not just providers—they’re partners in recovery, guardians of patient outcomes, and key contributors all along the way.  It’s time your perspective was recognized.  We help you through the Workers’ Compensation maze.

Join the AAWCP toay at www.wcdoctors.com.  It’s only $300 per year and no risk…as dues are fully refundable at the end of any year (for that year) if you feel you didn’t get a satisfactory return on your investment.

In 2024, the U.S. workers’ compensation insurance market recorded approximately $57.48 billion in direct premiums written. Medical costs typically account for 60% to 65% of premium dollars.  Thus, medical costs for Workers’ Compensation claims are approximately $36B. 

These are the Top 10 Insurers in writing Workers’ Compensation premium in the United States (2024):

• Travelers:  $3.8B in premium
• Hartford:  $2.9B
• Berkshire Hathaway:  $2.7B
• Liberty Mutual:  $2.6B
• AmTrust:  $2.1B
• Chubb:  $1.9B
• Zurich:  $1.8B
• State Insurance Fund of NY:  $1.7B
• Old Republic:  $1.6B
• ICW:  $1.5B

And, here are some of the key trends impacting the industry:

• Medical Inflation: Rising costs for outpatient care, pharmaceuticals, and diagnostics are reshaping claim severity.
• Mental Health Coverage: Expanded definitions of workplace-related mental injuries are increasing physician involvement.
• Gig Economy Legislation: New rules around independent contractor coverage are altering claim volumes and physician caseloads.
• AI and Robotics in Safety: Emerging tech is reducing claim frequency but increasing complexity in injury classification.