Workers’ Compensation Pays Primary to Medicare When
a Medicare Beneficiary Has a Work-Related Medical Claim
Medicare is the primary federal health insurance for persons 65 or older in the United States. A person younger than 65 who receives Social Security or Railroad Retirement Board benefits from a disability may receive Medicare after 24 consecutive months of disability benefits. In addition, end-stage renal disease (ESRD) patients of any age may receive Medicare.
Beneficiary claims for Medicare for specific non-Medicare payers, such as Workers’ Compensation, have primary claim payment responsibility. Therefore, Workers’ Compensation covers most workers due to a workplace injury or illness. Workers’ Compensation paid $61.9 billion in medical and monetary benefits over more than 138 million US jobs in 2016. Each state varies Workers’ Compensation coverage, benefits, and reporting requirements for workplace injuries and illnesses.
However, a lack of a centralized database of Workers’ Compensation exists. Medicare claims data contains information on occupational health research and surveillance when determining the work-relatedness of injuries and illness, but it has challenges. According to the Medicare Coordination of Benefits Rules, workers’ Compensation is the primary payer to Medicare and Medicaid for a workplace injury or illness.
Identify the more than two million Medicare claims where Workers’ Compensation had primary responsibility with the associated Medicare beneficiaries, healthcare utilization, and financial costs.
For example, incomplete information of a beneficiary’s employment status during the claim or the event leading to the claim creates confusion if the claim is for an employed Medicare beneficiary, ongoing medical treatment for an earlier workplace injury or illness (potentially before Medicare enrollment), or workplace exposure created a pre-existing condition worse.
In addition, 12,807 (12%) of institutional claims included an ICD-9-CM E-code, a non-billable code identifying the first external injury cause, position, or other adverse effects. Therefore, available E-codes provide a detailed description of the cause of a workplace injury or illness when evaluated with the principal diagnosis. For example, motor vehicle traffic accidents, explosive accidents, or fire injuries account for costly claims (total charges of $500,000-$1 million per claim).
Event details qualifying Medicare beneficiaries regarding disability are unavailable. However, Medicare beneficiaries with a Workers’ Compensation primary claim (58.4%) should have originated with Medicare due to disability compared with all 2016 Medicare fee-for-service beneficiaries, 16.0%.
Therefore, a need for surveillance and tailored workplace interventions occurs due to disability for Medicare entitlement for 44.2% of beneficiaries at the time of this study. Approximately 15% represent a subset of the Medicare population to which beneficiaries become entitled because of disability.
An inquiry about injury or illness work-relatedness during medical care checkups helps coordinate insurance benefits and payments, occupational health surveillance, and assists with recovery or disability management when returning to work.
Other studies identified ICD-9-CM principal diagnosis codes for a workplace injury or illness within Medicare beneficiaries with Workers’ Compensation as the primary payer.
A non-fatal occupational injury and illness survey from the US Bureau of Labor Statistics in 2015 estimates musculoskeletal disorders, including sprains and strains, for 31% of total occupational cases requiring work absences. Other common diagnoses among working-age and Social Security Disability Insurance applicants include mental disorders, musculoskeletal disorders, and heart disease.
In addition, a significantly higher percentage of Medicare beneficiaries with a Workers’ Compensation payer of carrier and inpatient claims and claims occur with a principal diagnosis group related to the musculoskeletal system, connective tissue diseases or injury, and poisoning.
However, this study excludes all workplace claims, such as medical claims with an unfiled Workers’ Compensation claim, Workers’ Compensation claims for persons not enrolled in Medicare, or workplace claims not covered by Workers’ Compensation.
Therefore, it includes only Medicare beneficiary claims, a small portion of all Workers’ Compensation claims within 17 years of Medicare data, including $1.106 billion paid Workers’ Compensation claims. In addition, Workers’ Compensation paid $31.2 billion for medical and hospitalization expenses in 2017, where the average claim totaled $22,219. All Workers’ Compensation presents the combined short and long-term cost of work-related injuries, potential chronic health conditions, and various responsible payers once an employee enrolls in Medicare.
However, multiple stakeholders could further study the beneficiaries regarding the long-term financial benefits of occupational health prevention and interventions to prevent or reduce work-related injuries or illnesses.
Claim payments and study results may become influenced by economic changes, workplace, state Workers’ Compensation, or Medicare legislation. For example, a reduction in annual claims and total costs in 2010 corresponds with the number of Workers’ Compensation employees starting work in 2008.
As a result, employees reported fewer fatal and non-fatal work-related injuries and illnesses, overall Workers’ Compensation payments to injured employees, and the impact of the economic recession on medical care providers. In addition, the Medicare and Medicaid SCHIP Extension Act of 2007 increased attention to Medicare Coordination of Benefits Rules when enforcing Medicare Secondary Payer rules within 18 months after passing the act.
The Strengthening Medicare and Repaying Taxpayers Act of 2012 outlines additional guidance when Medicare seeks secondary payer reimbursements and a Medicaid statute of limitations as secondary payer actions. Workers’ Compensation paid 74% of the total to providers for workplace medical claims. However, Workers’ Compensation paid between 54-90% of the annual percentage to providers, showing Medicare legislation changes.
Limitations of the study include consistent report data of workplace events or beneficiary employment information of Medicare. In addition, most Medicare beneficiaries are persons at least 65 and may not represent all Workers’ Compensation claims.
The study also lacks data on reimbursements made or payer payment details. In addition, beneficiary payments are unavailable for home health agencies and hospice claims. Therefore, the beneficiary paid amount may be an estimate. For example, Medicare might pay a partial claim if Workers’ Compensation paid a portion due to a pre-existing condition exacerbated by the beneficiary’s job.
In addition, the beneficiary could have made a payment toward their deductible, coinsurance, or expectation of reimbursement. Another analysis limitation occurs when collecting Medicare claims data for billing purposes, not public health surveillance.
Previous epidemiological studies do not describe workplace claims among Medicare beneficiaries. As a result, this study must enhance the collection and surveillance of American workplace medical claims for occupational health research and workplace intervention strategies.
The Workers’ Compensation primary payer claims’ use of universal standards and non-billable ICD external cause of injury codes to indicate work-relatedness on Workers’ Compensation primary payer claims would inform workplace injury and illness prevention procedures. This analysis represents Workers’ Compensation claims within the Medicare population, including persons younger than 65 enrolled in Medicare due to disability.
In addition, most Workers’ Compensation costs and claims illustrate persons not enrolled in Medicare. Therefore, the study’s results examine workplace illness or injury claims from persons older than 65, representing long-term employment claims to provide national estimates of Workers’ Compensation beneficiary payments, and claims enrolled in both Medicare and Workers’ Compensation, including similar diagnoses for all Workers’ Compensations claims within the United States.