Friday, October 25, 2013

IMR: Frontal Lobe Required

What's interesting about the discussion regarding the unexpectedly large number of Independent Medical Review requests is that it is so singular; that the vendors/providers need to learn a lesson.

Alex Swedlow, president of the California Workers' Compensation Institute, said at the California Workers' Compensation Forum in San Diego (where I'll be presenting this afternoon on national trends) that there could be an average of 150,000 IMR requests a year if the current trend continues.

At $500 per IMR (not accounting for administrative costs, delay costs, etc.), that's $75 million per year...

Swedlow said that 26.9% of magnetic resonance imaging scans and computed tomography scans that were denied in utilization review are being challenged at IMR, and that the cost of denying these MRIs and CT scans through utilization review and defending them in IMR is beginning to outweigh the cost of simply paying for them.

He commented that the cost of IMR has many claims administrators hoping that there will be a "learning curve" among providers that would cause the number of IMR requests to decline.

And Christine Baker, director of the California Department of Industrial Relations, said the agency does not know whether the initial spike in IMR requests is the result of an intentional effort, but will attempt to find out.

As I commented earlier, of course all of these IMR requests are intentional - in litigated cases applicant attorneys are not going to risk malpractice by blowing a statutory deadline when the cost of the appeals process is entirely born by the defense.

It's a no-brainer. This is called malpractice protection.

Baker noted that some IMR requests are for unusually small amounts, which she attributed to overaggressive adjusters who were too quick to deny treatment.

"We had some cases of Salonpas pads rejected that were $15, go onto IMR for $500," she said. "In that sense, we really need to be careful and provide the care and request when needed."

Likely that is not overaggressive adjusters too quick to deny treatment, but simply the product of some automated processes that have not been tuned yet to account for smaller bills.

See - it's not just the providers that have to learn a new system. Those who approve the requests and pay the bills also have to go through a "learning curve."

People would like workers' compensation to be self executing with no frontal lobe activity necessary for the system to work. That isn't going to happen.

Real live people need to use their knowledge, experience and training to make qualified decisions about treatment requests at some point in time.

Sure, most people would rather defer the decision or delegate the responsibility so they are not to blame, but someone along the life of a request must actually compare the cost versus the benefit, and make a decision accordingly.

It's less expensive if this occurs on the "front end" - when the request first gets to the actual claim administrator.

The cost of IMR will cause a "learning curve" among claims administrators who ultimately will just pay such bills which will help cause the number of IMR requests to decline.

And vendors/providers will need to go through the "learning curve" to better understand what will, and what won't make it to IMR and/or ultimate approval.

In other words, both will work together to reduce IMR requests as both sides of the equation go through the "learning curve."

The reality of all of these exercises is that at some point there will be procedures that won't warrant IMR, and the payers will just wholesale approve those items.

And guess what, the providers will start wholesale requesting those items.

Because the IMR process inadvertently has generated motivations due to the cost and time frames applicable.

In a year or so I would expect the workers' compensation think tanks to tell us what procedures are costing more as a consequence of IMR, and what procedures have declined and/or costing less.

In the end I wouldn't expect IMR to save any net money. IMR's behavior modification rules will simply result in an internal cost shift mechanism.

Mark Webb, vice president and general counsel of the Pacific Compensation Insurance Company, said that group health insurers overcame their initial struggles with IMR to allow doctors to advocate for their patients, saying that UR practices will need to change.

"To me, that is a different dynamic that over time, could frustrate IMR if . . . we continue to do utilization review the way we have done it before," Webb said. "It should be sobering that in August there were 15,000 requests for independent medical review. That suggests that there is an issue on both sides of that dynamic."

I've said it before, and I'll say it again: The ONLY way to avoid the cost of IMR is to avoid UR in the first place.

Webb has it right - utilization review processes will need to change if IMR is actually going to work.

***********POST SCRIPT***********

Alex Swedlow offered this correction to the statements attributed to him:

I want to point out that your blog entry on my statement during the presentation, "Initial data shows that 26.9% of magnetic resonance imaging scans and computed tomography scans that were denied in utilization review are being challenged at IMR, he said."  was not what I had said nor was it what the accompanying graphic depicted. (I've attached the IMR slides from my presentation for your review.)  Our pending study looks at the distribution of types of services that went through pre-863 UR and post 863 IMR, not the hand off between cases that have moved through UR into IMR.  We won't be able to develop a critical mass of that kind of data for another 6 months.  Our UR database is for 2010-11 decisions.  My comment is that our IMR database (from 2013 decisions) shows that 26.9% of decisions are for MRI/CT scans. Our UR database shows MRI/CT scans make up 9.1% of reviews. So MRI's are taking up a much larger proportion of IMR review time than general UR reviews.


  1. UR was mandated by SB-899, IMR process by SB-864, and Work Comp was legislated in an attempt to take the Master-Servant doctrine out of civil litigation.

    It all boils down to the road to ....being paved with good intentions, or "if it 'ain't' broke don't fix it.'

    Of course, it all depends on the definition of broke. But railing at UR and calling on common sense is futile when the entire system has been redesigned to spread out responsibly and take away any adjuster decisions.

    They've tried to turn it onto an assembly line operation, and since were dealing with human beings, they are going to protest this dehumanization.

    I find it ironic that you are fighting for the re-emphasis on providing benefits, and yet endorse a single payor system that will cause a two-tiered system where those of us who can afford it will go concierge, leaving the rest with less physicians, less treatment, and at the mercy of a multi-tiered beauracracy which makes Workers Compensation look like a paradise.

    1. @ Elizabeth - UR wasn't "mandated". The only thing mandated by SB 899 was that administrators have a UR PROCESS in place, but there's nothing in the law that mandates that all treatment go through UR, or any treatment request for that matter.

      I don't understand your statement re single payor system - that argument to me is disingenuous. One has nothing to do with the other.

  2. When I could send the issue via a written request to the AME or ask the AME for an "outline" of necessary care for a client instead of a "needs medical treatment" my cases went smoothly...and my clients go better...then we got the PQME aka Fresno Group of doctors with 150 offices who virtually never saw the patients....but this was in the name of "reform" from 899. The tragedy is to me that the Administration and Labor have no idea what goes on in the real world...why would they- it isn't in their economic interest!