Grab a coffee and head on over to Wing of Zock. Jennifer Salopek has a freshly-posted Health Wonk Review, Spring Break Edition awaiting your perusal. The wonks are covering a wide range of policy topics and issues today – don’t miss out.
Archive for March, 2015
A decade after the BP Texas City explosion that killed 15 and injured 180, U.S. refineries are nearly as deadly as ever, according to Blood Lessons, an investigative journalism report by Houston Chronicle and Texas Tribune that looks at the aftermath of the tragedy at the facility itself and the industry at large. The report shows that serious risks remain unaddressed; survivors of the terrible event are distressed that even seemingly simple lessons haven’t been learned, such as locating flimsy break tents close to the refineries. The fatalities a decade ago largely occurred in just such temporary shelters.
In fact, it would appear that refineries are not a lot safer than they were then:
“No single refinery accident has matched Texas City’s devastation, but at least 58 people have died at American refineries since the BP blast, according to data compiled from Occupational Safety and Health Administration records, news accounts, lawsuits and union reports. There were at least 64 deaths in the 10 years before the accident.
The Department of Energy has tracked almost 350 fires at refineries in the past eight years – nearly one every week. There are about 140 refineries across the United States. Members of the United Steelworkers union like Ambrose have been out on strike, protesting at 15 locations. They’re worried, among other things, about safety, claiming that old refineries are routinely pushed far beyond safe operating limits, that fires occur too frequently and that trailers and tents remain in harm’s way.”
While OSHA stepped up inspections through a nationwide refinery emphasis program, it discontinued the highly labor-intensive program and lacks staff to enforce existing rules.
For other chapters in the report see:
Anatomy of a Disaster, which includes an animated video of what caused the BP explosion.
Survivors Remember, interviews and videos with survivors.
A deadly industry – Assembled data shows how and where refinery workers continue to die.
In other remembrances, Chemical Safety Board (CSB) Chairperson Rafael Moure-Eraso addresses the 10th Anniversary of the BP disaster in a brief video:
a weak safety culture, a deficient process safety management program, and obsolete equipment. These problems have continued in the refinery industry in decade since. He cites two large incidents, one being the 2010 Tesoro blast that killed 7 workers in Anacortes, Washington.
The CSB notes that current federal and state regulations are not strong enough on preventive measures and say that more regulatory oversight is required to strengthen prevention.
Related: The extended CSB report on the BP investigation, issued about one year after the tragedy.
This year’s WCRI conference is now a week in the past. It was an informative event with session presenters waxing eloquent with their charts and graphs and the general nitty gritty of workers’ compensation. There was a touching tribute to departing Executive Director Rick Victor and an equally touching and humble valedictory by him. An uplifting moment, that.
But in the week since then nobody’s talking about the charts and graphs and uplifting moments. No, what has filled the workers’ comp blogosphere is a continuing discussion about the ProPublica/NPR series, The Demolition of Workers’ Comp, the result of a year-long investigation by ProPublica’s Michael Grabell and NPR’s Howard Berkes.
On the date of publication, we wrote about the Grabell/Berkes piece, as well as another investigative report coincidentally released on the same day, this one by OSHA, entitled Adding Inequality to Injury: The Costs Of Failing To Protect Workers On The Job.
Both reports were highly critical, arguing that over the last decade more than 30 states have reduced benefits to injured workers. The ProPublica/ NPR series illustrated its thesis by focusing on individual workers who had suffered horrific injuries with poverty-inducing benefits. During the WCRI conference, as well as in the intervening week, the series has been roundly damned by workers comp professionals as biased in the extreme.
While explicitly saying he was not judging The Demolition of Workers’ Comp, Dr. Victor said, “It is hard to write a balanced report based on anecdotes.” Others in the business have not been so kind.
Most of our colleagues who have commented on the series have focused on what they perceived to be wrong with it. Lost in the weeds has been what is right with it. So, let me suggest what I think are two of the serious messages we should take from The Demolition of Workers’ Comp.
First, it is indisputable that there is wide variance and, in many cases, profound inequality with respect to workers’ comp benefits provided by the states. Grabell and Berkes pound this point home with the heaviest sledgehammer they can find. Workers’ comp pros may not like that, but it doesn’t make the point any less valid. Sure, they illustrate the issue with the most glaring examples, but so what? The inequality of scheduled benefits is absolutely true. It is true as Grabell and Berkes write that “The maximum compensation for the loss of an eye is $27,280 in Alabama, but $261,525 in Pennsylvania.” It is true that “The loss of an arm…is worth up to $48,840 in Alabama, $193,950 in Ohio and $439,858 in Illinois.
It is also true that maximum total temporary disability benefits differ among the states, sometimes markedly so. For example, if a worker living in West Stockbridge, Massachusetts, is injured on the job, maximum TTD weekly benefits are equal to the Massachusetts state average weekly wage, which is currently $1,214.99. However, if another worker, living 3 miles to the west – in New York – suffers the same injury, his or her maximum weekly benefit is $808.65. Is that fair? Why the difference?
The answer is that, although the average weekly wages in both states are roughly equal ($2.01 separate them) and although Massachusetts’ maximum benefit is equal to the state average weekly wage ($1,214.99), in New York the maximum benefit, at $808.65, is only two-thirds of the the Empire State’s average weekly wage. So, the Massachusetts maximum benefit is 50% higher. Both workers may shop at the same Big Y supermarket, but I can guarantee the Big Y doesn’t have one price for the New Yorker and another for the Bay Stater.
To me, this glaring disparity in state benefits, especially scheduled benefits due to the loss of bodily function, cries out for profound reform. Trouble is, I don’t see any Galahad coming over the crest of the hill to right this wrong. Do you?
The second message concerns employers and it is this: Regardless of what you may think of benefits paid to injured workers, and despite the perceived high medical loss costs and physician dispensing issues we spent nearly two days last week discussing in Boston, it is true that, nationwide, workers’ comp premium rates are at a level not seen since the very early 1980s, and, in some states, the 1970s. It is true that, in terms of workers’ comp premiums, today’s employers have never had it so good.
That’s great, and I plead guilty to having worked very hard over the last 30 years helping employers make that happen. But perhaps it’s time to take some of those premium savings and invest them in better scheduled benefits in the states that lag far behind in the fairness race. Perhaps it’s time for all states to take another look at the 1972 National Commission’s recommendations and consider re-examining how they stand with respect to recommendation adoption. Finally, perhaps it’s time we workers’ comp professionals unload the gatling gun and stop shooting the messengers.
Brad Wright posted Health Wonk Review: Spring Forward Edition at Wright on Health — and if you still have giant snow piles and ice bergs in your neighborhood as we do, the signs of spring that Brad has planted through the post will be a wistful reminder that spring will one day come to you too.
As with most HWR issues, there’s a lot to chew on in this post as the best policy wonks in the blogosphere dish up news and opine on important issues in the health arena. The Supreme Court’s review of King v. Burwell is the topic du jour but there are many other issues too: Ebola, emulsifiers, mortality as a quality measure, weight loss fines and more. Grab a nice cuppa and check it out!
Two major issues were discussed this morning on the first day of WCRI’s annual conference: cost shifting from group health to workers’ comp and physician dispensing.
Dr. Richard Victor, the 31-year WCRI CEO who’ll be retiring in 2015, hung the cost shifting issue firmly around the neck of capitated group health insurance plans. His reasoning went this way:
- Capitated plans have been steadily decreasing in number since the turn of the century.
- A capitated plan pays doctors a set amount for each patient in the plan assigned to them.
- Workers’ comp is fee for service and pays more than capitated plans.
- A major goal of the ACA is to establish Accountable Care Oranizations, which pay by capitation.
- Therefore, there will be a reversal in the decline of capitated plans and they will steadily increase in the future.
- Consequently, there will be a heightened incentive for doctors and patients to shift some claims from group health to workers’ comp, especially soft tissue injuries, which are harder to attribute to a specific cause.
The second presentation, one that was a bit more dense, looked at physician dispensing, specifically in the 18 states that have changed their rules governing reimbursement.
The physician dispensing panel was moderated by WCRI’s Dr. Vennela Thumula, and consisted of her, Alex Swedlow, President of the California Workers’ Compensation Institute, Dongchun Wang, of WCRI, and myMatrixx’s Artemis Emslie.
With the exception of Dr. Swedlow’s presentation, I have the following takeaways from this panel:
- The state reforms lowered costs.
- But physicians continued to dispense, because, even with the lower reimbursements to them, they were still getting paid significantly more than pharmacies were paid for the same drugs.
- The lower costs may not be sustainable, because Pharma has figured out that it can retake the low ground by changing the strength of drugs. Vicodin is an example.
Regarding Alex Swedlow’s presentation – I felt like I was drinking from a firehose. Try as I might, I couldn’t keep up with all of the data he was dishing out. I know it was really good, but I felt like the Ed Sullivan Plate Spinner trying to keep all the plates on their sticks while being handed yet more sticks and plates. What my feeble brin came away with was this: California workers’ comp is a many headed hydra, and Alex and his colleagues can’t keep up with all the heads. They’re fighting the good fight, and the research produced by the CWRI is awesome, indeed, but there are forces at work in the Golden State that are formidable and relentless.
Gary Orren, Ph.D., of Harvard’s Kennedy School of Government, gave the last session of the morning. It was titled, Persuasion: The Science and Art of Effective Influence. Dr. Orren built his talk around Joshua Chamberlain’s heroic contribution at the Battle of Gettysburg. Chamberlain’s actions at the battle of Little Round Top were critical to the Union winning the battle of Gettysburg and, ultimately, the war. One could argue that if his Maine troops didn’t succeed at Little Round Top there would be no United States today.
As a history buff, I found this to be great stuff, but I have no idea what it had to do with workers’ compensation.
In the afternoon sessions, NCCI’s Barry Lipton presented data on the Price Impact of WC Fee Schedules and WCRI’s Dr. Rebecca Yang on the Perverse Effects of Low Fee Schedules. For Liptpon’s preasentation, I had returned to the firehose. He offered yet more data showing that workers comp costs routinely exceed those of group health and Medicare.
I take a bit of an issue with Yang’s presentation, which suggested that low fee schedules lead to problems with access to care – what doctor wants to treat someone if payment is really low?
Well, I suggest that WCRI take a hard look at Massachusetts, the state with the lowest fee schedule in the nation, where medical loss costs are 36% of total loss costs and where there is no problem with access to care. Just a suggestion.
I look forward to tomorrow’s sessions. Now, it’s on to a good dinner, followed by the Boston Symphony Orchestra’s performance of Szymanowski’s opera, King Roger.
Couldn’t be better.
In what can be nothing other than a coordinated move, both OSHA and ProPublica today released major reports targeting similar workers’ comp issues. ProPublica’s report was co-produced with National Public Radio.
The Demolition of Workers’ Comp
ProPublica’s Michael Grabell and NPR’s Howard Berkes wrote this report, which sledgehammers the workers’ comp industry, specifically insurers, state regulators and the business community. No matter how you feel about it, if you’re a workers’ comp professional, you should read this report.
In their skewering of the industry, Grabell and Berkes point to the gross differences in benefits provided by the states. They ask, “How much is an eye worth?” Then go on to show that it’s worth ten times more in Pennsylvania than it is in Alabama (around $261 thousand compared to $27 thousand – if you’re going to lose an eye, Pennsylvania’s the place to do it).
They note that workers’ comp premiums around the nation have been falling since the early 1990s, something we’ve written about often, and are now at the level of the late 1970s. Moreover, they note that:
Since 2003, legislators in 33 states have passed workers’ comp laws that reduce benefits or make it more difficult for those with certain injuries and diseases to qualify for them. Florida has cut benefits to its most severely disabled workers by 65 percent since 1994.
Despite this, Grabell and Berkes write that business owners clamor for still lower rates and more restrictive benefits in order to keep and attract business.
“That was always the No. 1 issue,” said state Sen. Brian Bingman, the Republican president pro tem of the Oklahoma Senate. “Your workers’ comp rates are way too high.”
Well, in thirty years of working for employers I have yet to meet one who did not think workers’ comp rates were too high – no matter how high or low they were.
Inequality of state workers’ comp benefits is a serious issue, yet one which I don’t see being addressed by anybody anytime soon. Do you?
This piece is thought-provoking and intelligently written. And Grabell and Berkes have heavy-hitter John Burton agreeing with them. Of course, that might have something to do with Dr. Burton’s Quixote-to-the-windmill quest for another workers’ comp national commission.
The recent changes are “unprecedented in the history of workers’ comp,” Burton said in an interview. “I think we’re in a pretty vicious period right now of racing to the bottom.”
I urge all workers’ comp professionals to read this informative piece of investigative journalism.
The OSHA Report
In today’s tag team match, OSHA released Adding Inequality To Injury: The Costs of Failing To Protect Workers Injured On The Job. This is a seriously impressive work.
In a 20 page, well-researched, well-sourced paper, complete with 37 endnotes, the agency takes the baton pass and sounds its own ringing indictment, taking aim at employers who evade workers’ comp responsibilities by misclassifying employees, labeling workers as independent contractors when they’re really employees, outsourcing high-hazard jobs and making heavy use of temp agencies. In this regard, OSHA cites research indicating that workers’ comp covers only 21% of the costs of injuries for these employees, while 50% is borne by them out-of-pocket (Leigh JP, Marcin JP. Workers’ compensation benefits and shifting costs for occupational injury and illness. Journal of Occupational and Environmental Medicine 2012;54:445-450).
One of the report’s more serious charges, among many, is found in this paragraph:
Moreover, only a fraction of injured workers receive any workers’ compensation benefits through state workers’ compensation programs. Several studies have found that fewer than 40 percent of eligible workers apply for any workers’ compensation benefits at all. Indeed, recent BLS-supported analyses that match cases reported to workers’ compensation carriers with those cases recorded by their employer on OSHA logs, treated in emergency rooms or admitted to hospitals, found a sizable proportion of injured workers receive no benefits through the workers’ compensation system. For example, a review of all recordable work-related amputations in Massachusetts found that less than 50 percent of the cases received any workers’ compensation benefits.
Just for a moment, suppose that Grabell and Berkes and whoever wrote the OSHA paper (it’s uncredited except for all those endnotes) are right. Would that mean that all of us, the professionals who labor in the workers’ comp vineyard, have had our collective heads in the sand for lo these many years? Is that possible? Perhaps it is. What would that mean for the future?
Well, here’s a suggestion for all of us. Read the ProPublic/NPR report. Then read the OSHA paper, paying particular attention to those 37 endnotes. Then, perhaps we could begin a conversation about how, while we’re all helping employers and insurers to reduce costs, we could actually deliver the lawful benefits to which all of America’s injured workers are entitled.
There’s an idea.
Hope to see you tomorrow in Boston where we might begin the conversation.