OAKLAND, Calif.–(BUSINESS WIRE)–#CWCI–A new California Workers’ Compensation Institute (CWCI) study offers some of the first comprehensive data on the use of Functional Restoration Programs (FRPs) to treat California injured workers. FRPs are multi-disciplinary programs used to treat injuries that involve chronic pain and improve patient function when the injuries do not respond adequately to traditional therapies.
For its study, CWCI analyzed 635 indemnity claims that involved FRPs compiled from the utilization review (UR) systems of 6 California workers’ comp insurers. Using demographic, bill review, and medical management data, the authors compared the FRP claim sample to 270,165 non-FRP indemnity claims to determine how they differ in terms of claim characteristics, geographic region, and clinical conditions. In addition, to gain a more precise assessment of FRP vs. non-FRP treatment costs, temporary disability (TD) duration, and claim durations, the FRP claims were compared to a matched sample of 2,361 non-FRP indemnity claims that had similar clinical, demographic, and claim characteristics to those of the FRP claims. The analysis found that unlike the broader indemnity claim population, which is primarily based in Southern California, FRP claims are heavily concentrated in the Bay Area, which represented nearly half of the FRP claims, and the Central Valley, which accounted for more than a quarter of the claims. In addition, the FRP claims were far more likely to involve attorney representation (94.0%) than other indemnity claims (50.8%), and despite the MTUS guideline criteria that FRPs be used for chronic pain patients, only 42.8% involved a chronic pain diagnosis, though it is unclear whether this was due to clinical inattentiveness in coding, or because some FRP participants did not have chronic pain.
FRPs typically began after extended periods of conventional treatment, with an average of 792 days between the first medical service date on the claim to the first FRP service date, during which time the injured workers averaged 37 conventional physical medicine visits. Though the Medical Treatment Utilization Schedule (MTUS) treatment guidelines recommend that FRPs run for 4 to 6 weeks, the study found that they tend to run longer, with a median duration of 8 weeks. While that exceeds the MTUS recommended level, it was consistent with the intent of typical UR approvals for FRPs. In addition, while the MTUS does not recommend a set number of days for an FRP, most injured workers in these programs received 20 to 40 days of FRP services, which was also consistent with the number of days approved by UR. On the other hand, injured workers in FRPs averaged 3.8 days of treatment per week, which was less than the MTUS recommendation of at least 5 days per week for tertiary rehab programs, but they averaged a total of 29.1 FRP treatment days. The study’s review of 2,896 FRP-related UR decisions across 1,059 claims (2.8 decisions per claim) found that 25.3% were denied and 4.8% were modified, significantly higher than the 7.7% denial/modification rate for non-FRP medical services noted in prior Institute research.
The cost data showed that FRP claims averaged $234,003, or 59.3% more than the similar non-FRP claims, as they were more expensive across all cost categories, with medical costs averaging twice as high, and indemnity costs and expenses each averaging 28% higher. Total inpatient and outpatient medical costs on FRP claims averaged $127,816, with FRP medical service costs alone averaging $59,106, or 72.6% of total outpatient payments on those claims. In contrast, inpatient and outpatient medical costs on the matched non-FRP claims averaged $64,062, with outpatient costs averaging $38,613. A key reason for the higher outpatient costs on the FRP claims was that a third of the procedure codes used to bill FRP services were not listed in the Official Medical Fee Schedule, and payments associated with unlisted codes accounted for 84.3% of total treatment costs on the FRP claim. The payment data also show that unlisted procedure codes used for bundled FRP services led to much higher payments than conventional services, averaging $1,751 per code or an estimated $350 per hour of treatment.
FRP claim durations were also longer as these claims averaged 520 temporary disability (TD) days, 25.2% more than the 415-day average for the matched non-FRP claims, which helped push average indemnity costs on the FRP claims to $87,855 vs. $68,533 for the matched claims. Average claim durations measured from the first medical service date to the claim closure date were considerably longer than the average number of TD days for both the FRP claims (1,287 days) and the matched non-FRP claims (1,013 days) as TD for most injuries in California is capped at 104 weeks (728 days) within a 5-year period from the date of injury, though the average duration of the FRP claims was still 27.0% longer than for the matched non-FRP claims.
CWCI has published its FRP analysis in a Report to the Industry which CWCI members and research subscribers can access under the Research tab at www.cwci.org. Others may purchase a copy from CWCI’s online store here.
Contacts
Bob Young
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