Recent news stories about WSI don't really clarify what's happening but it's important to realize that decisions about WSI can affect health insurance premiums and taxes. On Friday, August 13, I listened to and took part in discussion about a Performance Review of WSI. This is the latest in a series of reviews done every two years as ordered by the N.D. legislature.
One news story says initial denials rose from 11% to 19% between 2005 and 2009. Another says adjusted denials went up 51% from 6.9% to 10.4%. Headlines shout, "WSI denying more claims" (Bismarck Tribune) and, "Officials say WSI on track in N.D." (The Forum). The review cites a tougher claims philosophy at WSI but also says WSI follows the law. WSI cites positive things in the report and says that early accident reporting makes denial rates look worse than they really are.
All these statements are true but each has its own spin. Administrative changes have prompted employers to report incidents immediately even if no benefits are later required. These cases are counted as initial denials. Subtracting such denials leaves adjusted denials. WSI's comment on early reporting does not apply to adjusted denials. Each of the last two reviews say the change of philosophy at WSI is a major reason for adjusted denial rates going up.
WSI officials point out that the review covers WSI prior to June 30, 2009, only four months after the governor's newly appointed director took office. They report efforts to improve treatment of injured workers. However, laws limit how much they can change regarding claim decisions.
The Performance Review contains 50 recommendations and points out areas where claims are denied or partially paid in N.D. that would be fully paid in most other states. It suggests changes in N.D. law.
If medical treatment for a work-related injury is not covered by WSI it must be paid by regular insurance. This shifts the burden to all insurance payers. Health insurance premiums have risen the last five years while WSI has paid over $250 million in premium refunds. In 2008, for example, BC/BS announced double digit premium increases and WSI declared a $77 million dividend.
If work-related injuries cause disability, injured workers can't pay their bills. Workers can and do end up on Food Stamps, SSI or other forms of taxpayer assistance. Some families break up under the pressure of finances and health problems. Dependents can end up on WIC or other taxpayer support.
In my opinion, premiums collected to pay for worker injuries should pay for worker injuries. This burden should not be shifted to other health insurers and to taxpayers in general.
Reforming workers compensation law is the just thing to do for injured workers and it is the fair thing to do for taxpayers. Legislators will have an opportunity in 2011 to make the necessary changes.