Workers’ compensation is sometimes called “the Grand Bargain.” Under workers’ comp, employees give up their right to sue their bosses for workplace injuries and illnesses in exchange for compensation under a no-fault system. As Rep. Lynn Woolsey (D-CA) said at a Nov 17 subcommittee hearing of the House Education & Labor Committee, this grand bargain of the 20th Century doesn’t seem so grand these days. Benefits for injured workers have declined significantly since the 1990s because of intensive state-level lobbying by insurers and self-insured employers. The latest guidelines for assessing workplace health issues may depress benefits even further.
The primary focus of the hearing was the sixth and latest edition of the American Medical Association’s Guides to the Evaluation of Permanent Impairment, the bible for determining how a workplace health problem translates into on-the-job impairment. This may sound like an obscure issue, but the answers potentially affect millions of American workers. Many states require the use of the latest edition of the Guides, the 6th Edition, published in 2007, has proved so controversial that some states, including Iowa, Kentucky and Vermont, have chosen not to adopt it.
Iowa Workers’ Compensation Commissioner Chris Godfrey testified that, in states that use the latest edition of the guide, some workers who would have been compensated under the 5th Edition guidelines will go uncompensated under 6th Edition rules. These changes don’t just affect workers and their families. Disabled employees who are not compensated through work are likely to seek benefits through their private health insurance or through public programs such as Social Security Disability. Either way, costs are shifted away from employers, who are supposed to be responsible for work-induced health problems under the “great bargain.”
Rep. Woolsey alleged in her opening statement that the latest edition of the guide has “dramatically reduced impairment ratings for many types of conditions, without apparent medical evidence, and transparency.” Various witnesses echoed Woolsey’s assessment that the 6th Edition is dramatically different from previous editions.
“It also appears that the 6th edition was developed in near secrecy, without the transparency and consensus which should necessarily accompany the development of standards that will have widespread use by state governments,” she added.
Godfrey testified that the AMA declined to disclose the names of the authors of chapters in the guide to an Iowa Workers Compensation task force in 2008. As of this week, neither the Iowa Division of Workers Compensation, nor the Workforce Protections Subcommittee had received a list of chapter authors.
The AMA was invited to send a representative to testify at the Nov 17 hearing, but the Association declined to do so and instead submitted written comments for the record.
In a statement to WITT, the AMA argued that 5th Edition impairment ratings were injustifiably inflated over the 4th Edition and that the 6th Edition brings ratings back to 4th Edition levels. The organization also notes that it received feedback from “over 500 medical state, county and specialty societies, and additional impairment process stakeholders.”
The ratings in the Guides are said to be “consensus-based.” But this invites the questions: Who signed up to shape the consensus, and why? At the end of the day, who decided what constituted a consensus among all these different voices?
It’s not clear what methodology the AMA used to solicit input, nor what metric it used to measure consensus among respondents. These details are critical to assessing the validity of any process that is purportedly built upon expert consensus. Many observers have expressed concerns that the organizations and individuals who were most highly motivated to participate might also be those with vested interests in the outcome.
Godfrey noted in his testimony that one of the major movers and shakers behind the latest edition of the Guides is Dr. Christopher R. Brigham. Brigham is an executive at a company that specializes in contesting disability assessments, usually on behalf of clients seeking “independent” ammunition to pay out lower compensation settlements.
Transparency is especially important because the Guides is the product of a private, non-governmental organization that is not directly accountable to the public. Yet many public programs are legally required to use the book.
Lower impairment ratings could save a lot of money for self-insured employers and insurance companies. WITT asked the AMA to specify what conflict of interest protocols are in place to weed out contributors with vested interest and what protections are in place to insulate authors and editors from lobbying by outside interest groups. So far, we have not received an answer, but we will update this post if we get one.
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