New Study Tracks Changes in New York Workers’ Comp System After 2007 Reforms

The ongoing effects of workers’ compensation reforms enacted in New York in 2007 are monitored by the Workers Compensation Research Institute (WCRI) in a new study that focuses on objectives that are being achieved, objectives that are not being met, and any unintended consequences that have emerged.

The new WCRI study, Monitoring Changes in New York after the 2007 Reforms, is the latest edition of an annual report to regularly track key metrics of the performance of the state’s workers’ compensation system following the implementation of 2007 reforms.

The reforms increased maximum statutory benefits, limited the number of weeks of permanent partial disability (PPD) payments, created medical treatment guidelines, adopted a fee schedule for pharmaceuticals, established networks for diagnostic services and thresholds for preauthorization, and enacted administrative changes to increase speed of case resolution.

“This is a significant tool for tracking the latest changes to the New York workers’ compensation system following the reforms in 2007,” said Ramona Tanabe, deputy director and counsel for WCRI. “It can help public policymakers, employers, insurers, and other stakeholders determine the effectiveness of the changes and if they have generated unintended consequences.”

The following are among the study’s key findings:

• The average weekly temporary total disability benefit increased 26 percent after the implementation of three increases in the benefit rate between 2007 and 2009.
• The percentage of PPD cases with no lump-sum payments at an average 24 months of experience fell 13 points from 2007 to 2009, while there was a 10.5 point increase in cases with lump-sum settlements but no PPD payments.
• The implementation and subsequent change of the pharmaceutical fee schedule decreased the average price per pill by 10 to 20 percent, depending on drug and dosage.
• Defense attorney involvement increased from 2005 through 2007, was relatively stable from 2007 through 2009, and then increased by about 2 percentage points in 2010, driven mainly by cases with defense attorney payments of less than or equal to $500.

The report noted that the changes have various effective dates and have been instituted over time. As a result, it will be several more years before the full effects of the reforms will be realized.

The study uses open and closed indemnity and medical-only claims with dates of injury from October 2004 through September 2010, with experience as of March 2011. The data are representative of the New York system.

Visit this address to purchase this study: http://www.wcrinet.org/result/ny_reforms_2013_result.html.

Source: WCRI