The Truth About the Affordable Care Act and Workers’ Compensation

Jan 31, 2018 | WC & Other Laws

Affordable Care Act – The Affordable Care Act (ACA) presented changes in healthcare coverage that often became controversial. Knee-jerk reactions from insurance companies and human resources organizations believed the ACA would either reduce care quality in workers’ compensation or encourage fraud.

Affordable Care Act

Independent, non-partisan studies showed these fears were unfounded. In fact, the ACA did more to help workers’ compensation claims and reduce fraud. These are the myths often stated about the ACA and workers’ compensation and the truth of these issues.

Myth: The ACA will crowd out Denver workers’ compensation patients as demand for primary care increases.

Truth: Studies show that the increased demand has not affected access and quality of care for workers’ compensation patients.

The ACA increased health insurance coverage which created a run on primary care. Doctors received more patient files, and that was expected to decrease the quality of care for those receiving treatment under a workers’ compensation policy.

A comprehensive report by the National Council on Compensation Insurance, Inc. (NCCI), concluded that there was no significant impact to care access. Medicine has always been a demanding field and that did not change with the ACA. Clinics and hospitals adapted to the new demand for primary care. Patients received better treatment overall for all their needs, including any workers’ compensation claims.

The same report showed that 68 percent of primary care services occurred during the first 10 days of a workers’ compensation claim. Basically, these claims start off as being demanding on healthcare providers but eventually taper down to become manageable. That allows the issue to even out across the board as providers adapt to patients’ needs.

Myth: The ACA increases the possibility of workers’ compensation fraud.

Truth: Due to increased access, there are fewer reasons to file a workers’ compensation claim and that will likely reduce fraud.

Workers’ compensation coverage can be a result of cost-shifting. When a worker is underinsured, doctors may classify the injury or illness as a workplace injury. This allows the claim to become a workers’ compensation matter that reduces costs to the worker.

Cost shifting was most common with pre-existing conditions. When insurance companies were allowed to deny coverage for those injuries or illnesses, it created a desperate situation where fraud became preferable to declining treatment.

Now, pre-existing conditions are covered, and that reduces the need to classify a condition as a workplace claim to guarantee coverage. Two reports, the NCCI one and another independent study by Cognizant, indicate overall claims and fraud decreased since the passage of the ACA.

Myth: Doctors are more likely to label a condition as a workplace injury because they receive more for reimbursement.

Truth: While the insurance industry feared this development, it never played out.

This is related to the crowding-out concern. As doctors face higher caseloads, they may be concerned about being paid for all these patients. ACA policies do not pay out as much as workers’ compensation ones, so doctors become more willing to believe fraudulent claims and push for workers’ compensation rather than a routine healthcare claim.

However, this has not played out. Workers’ compensation claims decreased overall, with no evidence of fraud becoming more widespread. As stated earlier, workers are not as dependent on the workers’ compensation to receive healthcare. The same incentive for fraudulent claims does not exist anymore.

Myth: The ACA will raise workers’ compensation medical costs.

Truth: The support of preventative care reduces claims and also medical costs.

Cognizant reported that in Massachusetts, workers’ compensation claims were reduced by 16.7 percent, and workers’ compensation hospital costs decreased between five and 10 percent. The ACA reduced costs from the supply side, and that affects all healthcare, even that covered by workers’ compensation. This is especially true in states that adopted a Medicaid expansion and increased coverage to more people.

Preventative care played a role as well. For example, obesity prevention programs reduced workers’ compensation costs by three to four percent.

The areas of workers’ compensation and healthcare are complex and that often leads to misunderstanding and rumors. These myths can lead to uninformed decisions and mishandling of your claim. Contact our Denver Workers’ Compensation Attorneys today to get help with or a review of your Colorado workers’ compensation case.

Additional Resource: How Trump May Affect Workers’ Compensation In Colorado

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