HomeMy WebLinkAboutIR 9720 INFORMAL REPORT TO CITY COUNCIL MEMBERS No. 9720
To the Mayor and Members of the City Council April 7, 2015
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*a SUBJECT: WORKERS' COMPENSATION QUALITY AUDIT
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In February, the Mayor and Council requested a quality audit be performed of the services
provided by the City's Workers' Compensation Third Party Administrator (TPA), CorVel. The
request was due to complaints that indicated that services provided, such as case management,
were not being performed in a consistent and fair manner toward employees and medical
providers in carrying out administrative duties. The City contracted with its consultant for
Workers' Compensation, McGriff, Seibels and Williams of Texas, Inc., to conduct an independent
review. The preliminary results of that audit are attached. Still pending is the completion of the
survey of claimants. Once complete, the survey findings and any subsequent conclusions and
recommendations will be added to the report.
The City has established a self-funded Workers' Compensation Program under Section 504.011
of the Texas Labor Code and contracts with a TPA certified by the State to provide claims
adjustment and administrative services in accordance with State statutes, rules and regulations.
The TPA provides services that include determining eligibility, calculating benefits, approving and
authorizing payments of benefits and medical bills, approving and authorizing medical treatments,
and coordinating the claims process with City employees, doctors, medical providers and internal
and external service providers (e.g., peer review, designated doctors, etc.). CorVel has been the
City's TPA since January 2013.
Human Resources and the consultant outlined five areas that would act as key measures to
determine the appropriateness of CorVel's services. Those included:
1. Claims and denial frequency
2. Pre-authorization processing and denial
3. Nurse case management assignments and utilization
4. Complaints against CorVel
5. Survey of Workers' Compensation claimants regarding case management
Additional information from the Texas Department of Insurance in the form of statistical reports,
research data, annual reviews and complaints filed were also reviewed.
Highlights of the report indicated that:
• Denial of claims has remained constant over the last three years and far below state
averages — this period includes the last year of the previous TPA, CCS Holdings.
• Denial of pre-authorizations has risen from 17% to 28% over the three year period, but this
is at least partially attributable to changes in state regulations.
• Case management assignments have risen 39% over the past two year, without apparent
corresponding grounds based on the intensity of claims.
• Informal complaints from claimants were reviewed by the consultant, and, based on their
assessment, they are primarily driven because of poor/ineffective communication by the
ISSUED BY THE CITY MANAGER FORT WORTH, TEXAS
INFORMAL REPORT TO CITY COUNCIL MEMBERS No. 9720
To the Mayor and Members of the City Council April 7, 2015
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*a SUBJECT: WORKERS' COMPENSATION QUALITY AUDIT
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TPA — inadequate communication of procedures, purpose and role of case management
when assigned.
• CorVel received an "Average Performer" assessment rating from the Texas Department of
Insurance in the administration of the City of Fort Worth's Workers' Compensation program
— this rating is considered lower than expected for a municipal TPA.
• Since 2011 thirty-seven formal complaints/problem reports have been received by the
Texas Department of Insurance from City of Fort Worth employees. Of those, twenty-three
were against CorVel with two findings against the TPA that resulted in warning letters — no
administrative penalties were assessed.
The Human Resources Department for the City of Fort Worth has already begun discussions with
CorVel to ensure that corrective action is taken in areas needed. Corvel is in the third year of their
three year contract.
Human Resources will be conducting a request for proposal process for Workers' Compensation
TPA services beginning next month. Human Resources is currently working with police, fire and
general government employee/management representatives to explore alternative delivery
models that, as a part of the RFP process, will address concerns and still provide a cost effective
program.
Once the survey of claimants is completed, the survey findings and subsequent conclusions and
recommendations will complete the audit and be incorporated in the upcoming RFP process.
David Cooke
City Manager
ISSUED BY THE CITY MANAGER FORT WORTH, TEXAS
THE CITY OF FORT WORTH WORKERS'
COMPENSATION PROGRAM QUALITY AUDIT
EXTENDING YOUR CAPABILITIES
COVERING YOUR FUTURE
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McGriff, Seibels & Williams of Texas, Inc.
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5080 Spectrum Drive, Suite 900E
Addison, Texas 75001
(469) 232-2100
(469) 232-2101 Fax
MARCH 31, 2015 www.mcgrif£com
M. RIFF. SEISELS&WILLIAMS OF TEXAS, INC.
Executive Summary
A. OBJECTIVE — The Human Resources Department of the City of Fort Worth has requested that
McGriff, Seibels and Williams of Texas, Inc. conduct a Quality Audit of the City's self-funded
Workers' Compensation Program. McGriff, Seibels and Williams of Texas, Inc. is the City's Insurance
Broker of Record for the purchase of Excess Workers' Compensation insurance and related
consulting services.
B. BACKGROUND—The City has established a self-funded Workers' Compensation Program under Sec.
504.011 of the Texas Labor Code and contracts with a Third Party Administer (TPA) certified by the
State to provide claims adjustment and administrative services in accordance with State statutes,
rules, and regulations. Services provided by the TPA include determining eligibility, calculating
benefits, approving and authorizing payments of benefits and medical bills, approving and
authorizing medical treatments, and coordinating the claims process with City employees, doctors,
medical providers, and internal and external service providers. The TPA or its sub-contractor will
also provide Medical Cost Containment services which include functions specific to medical care and
treatments involved in claims such as medical bill review and audit, nurse case management, pre-
authorization of medical procedures, review of medical necessity, and peer review of medical
treatments. The quality of service provided by the TPA has a direct impact on employee medical
care and recovery, City fiscal responsibilities, and City service delivery.
C. PURPOSE AND SCOPE OF PROJECT—A predominant amount of the services provided by the TPA are
determined or regulated by Texas Department of Insurance (TDI) rules and procedures. The TPA's
compliance with TDI statutes are not the subject of this audit but are referred to as applicable to
quality performance measures. Additionally, Workers' Compensation claims involve medical
treatments, employee medical information, and professional medical decisions made by licensed
medical providers. Audit, analysis, or review of medical decisions and treatments is beyond the
scope of this audit.
The purpose of this Workers' Compensation Program Quality Audit is to analyze the quality of
services provided by the TPA. Quality services would be performing services in an effective manner
to successfully administer the City program. Additionally, quality services include performing in a
consistent and fair manner toward employees and medical providers in carrying out administrative
duties.
Key measures focused on:
1. Claims and Denial Frequency
2. Pre-Authorization Processing and Denial
3. Nurse Case Management Assignments and Utilization
4. Complaints against Corvel
5. Employee Satisfaction with Case Management
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M. RIFF. SEISELS&WILLIAMS OF TEXAS, INC.
The City's contract for TPA services with Corvel began on 01/01/13. Baselines and consistencies are
measured against Texas Department of Insurance statistics and the prior City contracted TPA CCS
Holdings, where applicable.
The City employs a wide variety of occupations - from office clerical to heavy labor. Although
injuries can occur at any position, the inherent hazards associated with Police and Fire operations
result in the highest frequency of claims, and subsequently a higher frequency of interaction with
the TPA. Therefore this review incorporates a breakout of General Employee, Police, and Fire claims
to account for this higher frequency of interaction.
D. PROCESS — Claims data was reviewed over a three year period (2012-2014) to include the final
contract year of the City's prior TPA, CCS Holdings in 2012, and the first two years of the current
contract with Corvel, 2013 and 2014.
2012 Data used throughout this report was obtained from claims data files and reports received
from CCS Holdings, their subcontractor Review Med, and the City of Fort Worth.
2013 and 2014 Data used throughout this report was obtained from claims data files and reports
received from Corvel, claims system access authorized and approved by the City and Corvel, and
information provided by the City of Fort Worth.
Additional information was obtained from the Texas Department of Insurance through statistical
reports, research data, and annual reviews available through on-line access of Texas Department of
Insurance public information.
E. FINDINGS
• The frequency of City of Fort Worth Workers' Compensation claims being fully denied has
remained consistent over the three year period reviewed with no significant change in denial
frequency between Corvel and CCS. City claim denial rates are less than half of the State
averages for all employers.
• Police and Fire department claims are denied less frequently than General Employees.
• Police and Fire have a higher average number of claims per employee than General Employees.
• Multiple injury claims require additional medical review to maintain separation during the
processing of claims.
• Denial of pre-authorization for medical treatment has increased in frequency from 17% to 28%
over the three year period. Changes in TDI rules for pre-authorization during this period have
impacted denial rates.
• Case Management assignments have increased 39% over the past two years with no identifiable
increase in City defined injuries requiring assignment. Increased case management activity is
attributed to expediting the process of obtaining medical information from providers.
• A common theme throughout the complaints against Corvel reviewed is poor communication
during the claims process.
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M. RIFF. SEISELS&WILLIAMS OF TEXAS. INC.
• Texas Department of Insurance investigation of 28 complaints against Corvel has determined
that 21 had no violations and were dismissed, 2 found Corvel to be noncompliant and warning
letters were issued, and 5 complaints are pending.
• The Texas Department of Insurance 2014 Performance Based Oversight assessment of Corvel's
performance in administration of the City of Fort Worth Workers' Compensation program
resulted in an Average Performer ranking with a score of 92.67%. The 2012 TDI PBO assessment
of CCS's performance in administration of the City of Fort Worth Workers' Compensation
program resulted in a High Performer ranking with a score of 97.88%.
F. CONCLUSION
The City of Fort Worth contracts with Corvel to provide Workers' Compensation claims adjustment
and administration services in accordance with State law. The Texas Department of Insurance's
assessment of Corvel's performance based on statutory compliance measures is that they are
Average. This average performance on compliance measures also relates to the overall quality of
service Corvel provides the City in the administration of the program. Corvel adjusts the City's
claims, denies claims where appropriate, approves and denies pre-authorization of medical
treatment following TDI rules and guidelines, assigns case management per City requirements, all in
accordance with State law. There is no indication from the data and documentation reviewed for
this audit that Corvel inappropriately denies claims or pre-authorization of medical treatment, or
processes claims in any unfair manner.
However, there is a clear indication from this audit that Corvel does not effectively communicate
with City employees during the processing of their claims that results in misunderstandings,
complaints, and adversarial situations. This lack of communication creates dissatisfaction with
injured employees and potentially creates an adversarial relationship which has an impact on
effective resolution of their claim.
The Texas Workers' Compensation system is very complex and difficult to understand. Compliance
with TDI rules and procedures by the adjuster is a legal requirement in the processing of claims.
Effective communication with injured employees to explain these rules and inform them of required
procedures is essential to providing quality claims administration services. Corvel's lack of effective
communication with City employees has enhanced their dissatisfaction with the Workers'
Compensation system and created a perception of poor quality performance as a service provider.
It is the expectation of the City of Fort Worth that their Third Party Administrator not just provide
claims administration, but provide Quality claims administration. To achieve this, the TPA should
strive for improved performance, a High Performer ranking from TDI, and effective communication
with City employees.
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M. RIFF. SEISELS&WILLIAMS OF TEXAS, INC.
City of Fort Worth
Workers' Compensation Quality Audit
1. Workers' Compensation Claims Frequency
The City of Forth Worth has experienced a 13% decrease in claims frequency from 2012 to 2014,
and a 16% overall decrease in total incurred costs. The data below shows the breakdown of the
number of claims reported during fiscal years 2012, 2013 and 2014 by the fire department, police
department and general employees. The reduction in City staff of 425 FTEs between 2011 and 2013
(381 attributed to General Government) is a factor in this overall decrease in claims frequency. The
2014 OHS Safety Program Audit noted that Safety Program improvements were needed across all
departments; however specific Safety and Accident Investigation programs in the Equipment
Services, Parks and Community Services, Code Enforcement, and Fire departments were having a
positive impact on employee safety. These safety programs may also be a factor in the reduction of
injury claims.
City of Fort Worth
WC Claims Data: Fiscal Year 2012, 2013, 2014
Fiscal Year of Number of Medical Total Paid Remaining Total
Injury & Indemnity Claims Reserves Incurred
Fire 2012 201 $964,806.93 $106,126.22 $1,070,933.15
Department 2013 150 $652,745.27 $113,118.93 $765,864.20
2014 138 $386,786.90 $462,497.45 $849,284.35
Police 2012 511 $1,196,707.09 $505,225.71 $1,701,932.80
Department 2013 525 $2,161,077.77 $505,306.27 $2,666,384.04
2014 554 $2,584,299.46 $242,470.02 $2,826,769.48
General Fiscal Year of Number of Medical Total Paid Remaining Total
Employees Injury & Indemnity Claims Reserves Incurred
2012 542 $3,834,145.24 $288,695.59 $4,122,840.83
2013 436 $3,180,805.57 $588,804.10 $3,769,609.67
2014 403 $1,571,247.62 $555,094.64 $2,126,342.26
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M. RIFF. SEISELS&WILLIAMS OF TEXAS, INC.
Workers' Compensation Claims Denied
All claims that were either fully or partially denied during fiscal years 2012, 2013 and 2014 were
reviewed. The Texas Department of Insurance uses the form PLN 1 for a full denial — the entire
claim is denied. The form PLN 11 is used for a partial denial of benefits, diagnosis, or treatment —
part of the claim is accepted and part of the claim is denied.
The primary reason for a claim to be fully denied is the injury is determined to be not work related.
An employee may injure themselves outside of work and claim the injury was work related. This
may be intentional, but more commonly the employee does not know specifically how or when the
injury occurred, such as the onset of back pain or soreness. In most cases, without a specific work
related occurrence the injury is not "compensable" and the claim is denied. A common disease of
life such as arthritis or hearing loss claimed by an employee as work related may also be determined
to be not compensable and denied.
Partial denial of claims occur when an employee has a work related injury and medical treatment is
sought or provided for body parts or conditions that were not affected by the work related
occurrence. An employee may be receiving medical treatment for an on the job injury and pre-
existing medical conditions at the same time and the medical provider files all of the treatment
under the workers' compensation claim. Pre-existing medical conditions are not part of the
compensable injury. Employees may have an "old" injury not work related and seek treatment for
both the "old" injury and a "new" injury that is work related at the same time. When these
situations occur, the injury that is work related is accepted and the injury or medical treatment that
is not work related are denied — partial denial. A peer review, a second opinion provided by a
qualified medical provider, may be obtained to review the diagnosis and treatment before the
denial is filed.
In any of these situations, the insurance carrier, or if self-insured the designated Third Party
Administrator, is responsible to initiate a dispute of compensability. Texas statutes have extensive
requirements that must be met in order for a claim to be denied. If a dispute is not filed timely
and/or does not meet the specified criteria, the State of Texas Division of Workers' Compensation
will not approve the denial. A TPA that does not have a valid reason to dispute a claim subjects the
self-insured insurance carrier to potential administrative violations and penalties.
Following is a chart of City of Fort Worth Denied Workers' Compensation Claims for 2012, 2013, and
2014. 2012 claims were administered by CCS Holdings, Inc. 2013 and 2014 claims were
administered by Corvel. The chart breaks out claim denials for Fire, Police, General Employees and
City totals.
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M. RIFF. SEISELS&WILLIAMS OF TEXAS, INC.
City of Fort Worth
Denied WC Claims: Fiscal Year 2012,2013,2014
Fiscal %of
Year Total %of Total Total Denials vs. Full %of City Partial %of City
of Claims City Denials Claims Partial
Reported Denial Full Denials Denial
Injury Denied Reported Claims Denials
J
Fire 2012 11 13% 201 5% 6 10% 5 18%
Department 2013 16 17% 150 11% 11 23% 5 10%
2014 8 7% 138 6% 4 7% 4 7%
Police 2012 32 36% 511 6% 22 37% 10 36%
Department 2013 37 39% 525 7% 16 34% 21 44%
2014 43 36% 554 8% 23 39% 20 33%
General 2012 45 51% 542 8% 32 53% 13 46%
Employees 2013 42 44% 436 10% 20 43% 22 46%
2014 69 57% 403 17% 32 54% 37 60%
City Total 2012 88 N/A 1,254 7% 60 68% 28 32%
2013 95 N/A 1,111 9% 47 50% 48 50%
2014 120 N/A 1,095 11% 59 49% 61 51%
During fiscal year 2014, 11% of all City claims reported were either fully or partially denied by
Corvel. This is up 2% from 2013 and 4% higher than the total denials by CCS in 2012. Corvel either
fully or partially denied 8% of Police claims in 2014 compared to 6% denied by CCS in 2012, and 6%
of Fire claims were denied in 2014 compared to 5% in 2012.
Police claims were denied less frequently than General Employees in each of the three years. Fire
claims were denied less frequently than General Employees in two of the three years.
Below is a chart from the Texas Department of Insurance of the number of fully denied Workers'
Compensation claims as a percentage of all reported claims from Insurance Carriers in the State by
year. These figures include all governmental entities, self-insureds, and fully insured employers that
report data as required by the State.
Per the Texas Department of Insurance, 12.6% of all reportable claims in Texas were fully denied
(PLN 1) in 2013 and 11.4% in 2012. In comparison, full denials (PLN 1) of City claims were issued on
4.23% of all City claims reported in 2013, and 4.78% in 2012 (5.39% of all City claims reported in
2014 were denied). City of Fort Worth full claim denials are well below State averages.
Full denials of Police claims in 2014 were 4.15%, in 2013 3.04%, and in 2012 they were 4.30%. Full
denials of Fire claims were 2.89% in 2014, 7.33% in 2013, and 2.98% in 2012. Full denials of Police
claims occurred less frequently than both City averages and State averages in each year. Fire claims
were fully denied less frequently than State averages in each year and City averages in two of the
three years.
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Mc R FF. SEISELS&WILLIAMS OF TEXAS. INC.
Denied/DisputedReportable Claims Initially
by Insurance (Whole Claim initial
Numberof PLN1 Denials Nutuber of Denials as a Percentage
Injuryl�ear Reported to DWC° Reportable Claims of Reportable Claims
2015 18,296 1160831 15.70
2006 16,898 116,736 143%
2007 16,390 112,106 14.6%
2008 14,994 1070727 13.9°
2009 12,040 97,164 12.4%
2010 11,110 99,171 11.2%
2011 11,110 98,524 11.3%
2012 10,962 96.430 11.4%
2013 10,513 83,369*• 12.5%
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Average Number of Claims Per Employee
The hazards associated with Police and Fire operations expose those employees to a greater risk of
on-the-job injury than most other positions in the City. Over the course of a multi-year career, there
is potential for employees to incur multiple injuries. Accordingly, Police and Fire average more
claims per employee than other departments. The chart below shows the average number of claims
per employee since 1985 when the employee has filed one or more claims.
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M. RIFF. SEISELS&WILLIAMS OF TEXAS, INC.
City of Fort Worth
Average Number of Claims Per Employee: Fiscal Year 1985 to 2014
Fiscal Year of Number of Medical Average
Injury & Indemnity Claims Claims Per
Employee
Fire 1985 to 2014 5,045 5.40
Department
Police 1985 to 2014 12,877 6.47
Department
General 1985 to 2014 10,311 2.82
Employees
Although risk of injury is an expected part of the job, employees having multiple injury claims
present potential issues in the administration of these claims. The adjuster must separate the prior
injury and medical treatment, which may still be on-going, from the current claim. Compliance with
the State mandated ODG Treatment Guidelines is more difficult if the treatment prescribed must be
altered to account for another injury or medical condition. Injuries to the same body part as a
previous injury may take longer to heal and often require additional medical treatment. These
complex issues require the adjuster to obtain additional medical reviews, peer reviews, and
additional medical documentation to appropriately administer the claim. This process can delay
medical treatment, and a lack of medical documentation and support could result in medical
treatment being denied.
As City Police and Fire department employees have a higher frequency of more than one Workers'
Compensation claim than General Employees, they may also have a higher frequency of delayed or
p denied medical treatment on a new claim.
2. Pre-authorization Review
The Texas Department of Insurance mandates the ODG Medical Treatment Guidelines be utilized by
doctors, medical providers, insurance adjusters and bill payers, and other professionals in the
Workers' Compensation system. Generally, medical treatment provided within these Guidelines
related to the compensable injury is accepted and approved for payment by insurance carriers and
adjusters. TDI has identified specific medical treatments or procedures that require pre-
authorization. Pre-authorization is the process for reviewing proposed medical treatment to
determine if it meets medical necessity in accordance with the ODG Guidelines.
TDI has issued rules and regulations involving the Pre-authorization process that must be followed
and adhered to by insurance adjusters and medical providers. If the request is initially denied, the
medical provider has the opportunity to modify their treatment recommendation and return for
reconsideration. A copy of Rule 134.600, Preauthorization, Concurrent Utilization Review, and
Voluntary Certification of Health Care provided by the Texas Department of Insurance, Division of
Workers' Compensation is included in the Appendix to this report.
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M. RIFF. SEISELS&WILLIAMS OF TEXAS, INC.
Pre-authorization is requested by the medical provider and performed by a utilization review agent
certified by the Texas Department of Insurance. This review agent may be an employee of the TPA
or an outside vendor. The City's current TPA, Corvel, provides pre-authorization in house. The City's
prior TPA, CCS Holdings, outsourced pre-authorizations to their sub-contractor Review Med.
The table below shows a breakdown of pre-authorization requests over the last three years, 2013-
2014 were performed by Corvel and 2012 CCS/Review Med.
City of Fort Worth
Preauthorizations: Fiscal Year 2012,2013,2014
Total Number of Approval Modified Denied
Fiscal Year Preauthorizations %of City Total Approved Modified Denied% % %
2012 211 14% 144 68% 28 13% 39 19%
Fire 2013 167 14% °
Department 103 62/° 20 12/° 44 26/°
2014 213 14% 115 54% 43 20% 55 26%
Police 2012 663 43% 470 71% 96 14% 97 15%
Department 2013 566 48% °
342 60% 80 14/° 144 26/°
2014 706 47% 384 54% 104 15% 218 31%
General 2012 662 43% 419 63% 113 17% 130 20%
Employees 2013 455 38% °
302 66/° 50 11/° 103 23/°
2014 574 39% 360 63% 62 11% 152 26%
City Total 2012 1,536 N/A 1,033 67% 237 16% 266 17%
2013 1,188 N/A 747 63% 150 13% 291 24%
2014 1,493 N/A 859 58% 209 14% 425 28%
The total number of pre-authorization requests has decreased by 3% from 2012 to 2014, which can
be attributed to the decrease in claims frequency. The Police Department has accounted for the
majority of pre-authorizations over the past 3 years with 46% of all City pre-authorizations, which is
directly related to their percentage of all City claims filed during this period.
Denied pre-authorization requests have increased from 17% in 2012 to 28% in 2014. Amendments
to TDI pre-authorization rules for prescription drugs outside of the closed formulary became
effective July 1, 2012, which increased pre-authorization denial of those drugs throughout the
Workers' Compensation system. An additional driver of pre-authorization denials is chiropractic
care. ODG Guidelines specify chiropractic usage and the allowable number of visits. Treatment
requests outside of these guidelines must be pre-authorized. Out of all individual medical providers
on City claims over the past three years, a chiropractic provider ranked highest in the number of
pre-authorization denials and received almost double the denials of the second most provider.
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M. RIFF. SEISELS&WILLIAMS OF TEXAS, INC.
3. Case Management Assignments
Case Management is a process that facilitates recommended treatment plans to assure that
appropriate medical care is provided to disabled, ill or injured individuals. It refers to the planning
and coordination of health care services appropriate to achieve the goal of medical rehabilitation. A
Nurse Case Manager is a healthcare professional whose job is to help make sure the injured
employee is receiving the appropriate medical care for their injury to promote faster recovery. A
Nurse Case Manager will attend doctor's visits with injured employees as needed to assist and
coordinate medical treatment, act as a resource for employees who have questions about their
medical treatment, advocate for the employee as needed to obtain the appropriate medical
treatment, and assist with providing information to the claims adjuster to facilitate the claims
process.
Section 413.021 of the Texas Labor Code states that all claims with the potential for lost time must
be evaluated to determine if nurse case management should be assigned. Additionally, the City has
specified requirements in the Claims Handling Instructions with Corvel regarding the assignment of
Nurse Case Management. These include catastrophic and severe injuries, head injuries, and injuries
requiring surgery as well as situations where there is a language barrier or difficulties in obtaining
medical information from a provider. Case Management information was not available from the
prior TPA, only information from Corvel was available and reviewed.
The following table shows Nurse Case Management assignments over the last two years.
City of Fort Worth
Case Management Assignments: Fiscal Year 2013, 2014
Fiscal Year of
Assignments
Injury
Fire 2013 25
Department 2014 42
Police 2013 49
Department 2014 67
General 2013 57
Employees 2014 73
There has been a significant increase in the number of assignments from 2013 to 2014. There is not
an identifiable increase in severe injuries or other City specified injury types that require case
management in the claims data reviewed, however there is an indication that case management
assignments have increased to assist with coordinating and obtaining medical information,
treatment plans, and supporting documentation from medical providers. This increase in case
management usage was recently directed by the City to Corvel as a means of expediting the claims
process due to delays in receiving medical information from providers.
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M. RIFF. SEISELS&WILLIAMS OF TEXAS, INC.
4. Complaints Against Corvel
Current issues have resulted in several City employees submitting complaints against Corvel and the
City's Workers' Compensation program. Nine complaints were sent by the City to Corvel for
response. These complaints and Corvel's responses have been reviewed. The central issues
common to each of these complaints are poor communication and the lack of understanding of the
Workers' Compensation system.
Two of the complaints regarded denials originally issued by the prior TPA and one of the complaints
involved a former Corvel employee not associated with the City's program.
Five of the complaints are related to the denial or suspension of benefits and/or medical treatment.
Based on our review of these five, the appropriate Workers' Compensation rules were followed.
Corvel's failure to adequately communicate these adverse decisions to the employee along with the
complexity of the Workers' Compensation rules resulted in the employee's dissatisfaction with the
way their claim was handled.
One of the complaints involved the assignment of a case management nurse to a claim and a
misunderstanding of the nurse's role and purpose of the assignment. Corvel's failure to inform the
employee of the case management assignment prior to them being contacted created confusion
and misunderstanding of the intended purpose.
Additionally, three formal complaints filed with the Texas Department of Insurance by City
employees against Corvel have been reviewed. One complaint was for the failure to timely dispute
entitlement to Supplemental Income Benefits. TDI determined no violation occurred and the
allegation was unconfirmed. The other two complaints were for the terminating or reducing
benefits without substantiating evidence. TDI determined no violations occurred and the
allegations were unconfirmed.
The Texas Department of Insurance Division of Workers' Compensation issues a "Problem Report"
whenever they receive a complaint from any involved party regarding the handling of a claim. The
City receives a copy of this report along with any findings by TDI regarding the complaint. Since
April 2011, the City has received 37 Problem Report notices from TDI. TDI has issued findings on 32
of these, 5 are pending. The 32 that have been finalized by TDI have been reviewed.
The City's prior TPA, CCS, accounted for 9 of these complaints. Of these, 7 were dismissed and the
allegations were unconfirmed. TDI found non-compliance from 2 of these complaints resulting in
Warning Letters, no Administrative Penalties were assessed.
Corvel accounts for 23 of these complaints. Of these, 21 have been dismissed and the allegations
were unconfirmed. TDI found non-compliance from 2 of these complaints. Both violations involved
the failure to timely issue payments to the claimants. Warning Letters were issued by TDI, no
Administrative Penalties were assessed.
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M. RIFF. SEISELS&WILLIAMS OF TEXAS, INC.
Texas Department of Insurance Audit
The Texas Department of Insurance Division of Worker's Compensation conducts annual
performance assessments of selected insurance carriers including self-insured governmental entities
through its Performance Based Oversight (PBO) program. The 2014 PBO included the City of Fort
Worth in this assessment along with 115 other insurance carriers or self-insureds. A total of 26
governmental entities were included in this assessment. Although the City of Fort Worth is the self-
insured entity, the City's TPA Corvel is responsible for the administration of the program and it is
their actual performance that was evaluated. The following performance measures are used for
PBO assessments:
• Timely payment of initial Temporary Income Benefits by the insurance carrier
• Timely submission of Initial Payment data via EDI
• Timely processing of initial medical bills by the insurance carrier
• Timely processing of request for reconsideration medical bills by the insurance carrier
• Timely submission of Medical Bill Processing data via EDI
Each carrier is graded on these measures and given a score. TDI has developed a Tier system to rank
carrier performance— High Performer for scores of 95%or greater, Average Performer for scores
between 80%- 94.99%, and Poor Performer for scores below 80%. The City was assessed a score of
92.67%—Average Performer for this 2014 PBO assessment.
Of the 26 governmental entities in the 2014 PBO, 23 of these entities scored as a High Performer.
This list of High Performers includes the City of Dallas, Fort Worth ISD, and Tarrant County.
The City was ranked as a High Performer during the 2012 PBO assessment with CCS as the City's
administrator and received a score of 97.88%.
S. Employee Satisfaction with Case Management
Employee satisfaction survey in process. Results to be provided upon completion.
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