By Donna Motley, Vice President of Claims

With inflation as a 40-year high, it seems the price of everything is increasing. Medical expenses are no exception.

Workers’ Compensation wage loss benefits are established by the State of Michigan, at the beginning of the year, every year, based on the State Average Weekly Wage. These weekly benefit rates, which includes a “maximum” rate, are published “on line” on the State’s website. Remember, we only handle Michigan Workers’ Compensation claims in our office. Wage loss benefits are calculated based on the highest 39 weeks of the previous 52 weeks of gross weekly wages of the injured worker, along with the number of claimed dependents allowed by the Workers’ Compensation Act. The rate established at the time of injury remains the same for the life of the claim. There is no cost of living increase, but the rate can be decreased if a claimed dependent no longer qualifies. There are decreases in the weekly benefit once an injured worker turns 65 years old – typically 5% per year or reduction taken when the injured worker begins taking Social Security benefits. Other than that, a weekly benefit rate established in 1997 is the same amount the injured worker would receive in 2022 if they are under the age of 65. Not much we can do about an established benefit rate.

All bills for medical treatment for a workrelated injury are processed through a State established “fee schedule” and discounts taken. If the medical provider belongs to “preferred provider” networks, additional discounts are taken. Typically, bills for medical treatment in Workers’ Compensation claims are reduced 40% – 60%. For the year 2021, we averaged a 75% saving on medical bills. Obviously, a hospital bill will receive a greater reduction than that of an Occupational Clinic, but they also “up-charge” far greater than an Occupational Clinic would. The clinics are aware of how much they can charge and how much they will receive. As an example, I recently processed a hospital bill in the amount of $21,518.73 and the approved payment was $8,708.05; a doctor charged $12,850.00 and was paid $3,986.36; an Occupational Clinic charged $230.45 and was paid $178.68; a physical therapy bill was $820.00 and was paid $246.78. Medical providers can file for a “Reconsideration” but they must be able to provide proofs as to why they are entitled to additional funds in line with the State established fee schedule. However, a provider cannot charge the injured employee the monetary difference in the reduced bill. The bottom line – the fee schedule saves a significant amount of money!

MTMIC utilizes a Pharmacy Benefit Manager (PBM) wherein prescriptions are filled at the injured workers’ pharmacy of choice and our PBM is billed direct, the bills are discounted and MTMIC reimburses our PBM. This can be accomplished on a first fill of a prescription, continuous re-fills of related prescriptions or after the prescription has been filled and MTMIC has received a paper bill. An additional benefit is that our PBM oversees to make sure the prescription is appropriate for the claimed injury, watches to make sure the re-fills are timely and keeps track of opioid use. If necessary, a letter will be written to the treating physician asking the physician to substantiate the continuation or necessity of a particular prescription. All prescriptions are to be filled with the generic version unless specified by the treating physician, thereby providing the largest saving. In 2021, MTMIC was saved $33,395.47 in prescriptions that were attempted to be filled “after” coverage had been terminated. Our PBM also provides the same services regarding durable medical equipment prescribed by physicians. Medical equipment can be something as simple as crutches, a shower bench, a ramp installation, bone growth stimulators, cold compression machines, wound vacs, etc. The PBM will arrange with the injured worker, delivery and pick up of the necessary equipment. They have a list of vendors from which to choose, so if one vendor cannot accommodate the request, they will find a vendor that can, and will, meet the need of the injured worker in a timely fashion. Our savings on just durable medical equipment for 2021 totaled $63,665.88.

The PBM also aids our department in finding and providing transportation for the injured worker when necessary, and can provide a translator if the injured worker does not speak English. Our participation with these outside programs allows us to keep track of “where” money is being spent. We can track if the money being spent is necessary and appropriate. We are able to then determine when and where adjustments may need to be made. The bottom line is a large financial savings, affecting the bottom line, resulting in MTMIC’s ability to pay dividends to their insureds! Everyone wins!