The Evolution of the Workers' Compensation Industry

The big question: What might be ahead as both clinical and non-clinical best practice research continue to evolve in the Workers’ Compensation industry? 

What we anticipate: Seeing improvements in claim and medical treatment practices to identify and mitigate psychosocial risk factors and social determinants of health (SDOH) that compound needless work disability. 

Why it matters: The gold standard outcome of work disability prevention and mitigation in a workers’ compensation claim is the employee’s return to work. Understanding psychosocial risk factors and SDOH’s, their differences, and appropriate interventions can help increase return to work.

Psychosocial factors are issues that affect an individual’s thoughts and behavior. Examples most prevalent in workers’ compensation:

-        Fear and avoidance

-        Catastrophic thinking 

-        Perceived injustice 

-        Perceived disability 

Longstanding fear that acknowledging issues related to psychology will increase claim duration and costs has finally dissipated in many jurisdictions.

Workers’ compensation payers have adapted to this by using billing codes developed in the early 2000s to support the treatment of psychosocial issues without the need for a diagnosed psychiatric condition and the complications and labeling of a patient that come with such a diagnosis. 

These billing codes are typically referred to as Current Procedural Terminology (CPT) codes. 

CPT codes are used to report medical, surgical, and diagnostic procedures and services to entities such as physicians, health insurance companies (including workers’ compensation regulators and insurers), and accreditation organizations.

SDOHs are non-medical factors that influence health outcomes. They are conditions in which people are born, grow, work, live, and age, and the wider set of forces and systems shaping conditions of life. 

Examples of primary SDOHs:

-        Inadequate housing

-        Food insecurities

-        Availability of community resources

-        Neighborhood crime

-        Lack of family support

-        Lack of education. 

These various determinants may affect the work disability problem at the individual worker level but often are not obvious or known to the claims professional. 

A new frontier: The industry is just beginning to talk about SDOHs that can influence a worker’s recovery and return to work. 

New billing codes may help: The more recent International Statistical Classification of Diseases and Related Health Problems (ICD) codes now include “Z” codes that allow medical professionals to flag SDOHs.

ICD codes differ from CPT codes: The first identifies a problem that treatment or interventions should aim to resolve while the second refers to the treatment being given. 

Although Z codes are still rarely used, workers’ compensation industry leaders and technology solutions should prepare now for future policy decisions and the potential need to accommodate these codes, related advancements, and ultimately design evidence-based system interventions. 

An example of Z Codes in use: Neighborhood Atlas, a website that uses zip codes to create awareness of whether a worker’s address is in a disadvantaged neighborhood.

-        This gives a more holistic picture of the worker’s environment and the issues they may be dealing with that can impact their individual resiliency, recovery, and decisions regarding return-to-work opportunities. 

Have questions? We can help.

Linea Solutions has been providing strategic guidance that has improved our clients for almost 25 years. We would be happy to meet with you virtually to discuss what type of assessment would be ideal for your organization. If you have questions about the best way to improve your organizational efficiency, contact us to see how we can help.

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