Monday we kicked off the discussion of the impact of PPACA/Obamacare/health reform on workers’ comp with a review of the (very limited) direct impact of reform on comp. Today it’s the the impact of increased group and Medicaid insurance coverage on workers’ comp.
Let’s leave aside yesterday’s announcement by HHS that the employer mandate will be delayed till 2015; we’re after the long-term impact, so the one year delay will not be material to our discussion. There will be somewhere around 30 million more folks covered by health insurance post implementation, with 32% covered under Medicaid, 45% from the individual exchanges, and 23% from employers. Here are the major effects of the increased coverage…
- Healthier workers heal faster – people without health insurance are not as healthy as those with coverage, and as healthier people heal more quickly when they are injured, the increased coverage means more work comp claimants will heal more quickly – reducing medical cost and indemnity expense.
- The preventive benefits will help identify – and hopefully lead to early treatment for – health issues that can prolong/delay recovery. Diabetes, asthma, depression, hypertension, and other conditions often go undetected until something really bad happens – an acute episode requiring a visit to the ER is typical. Controlling these conditions and keeping them under control will speed recovery from injuries.
- Many injured workers don’t have health insurance. If they have health conditions – say obesity – that are affecting recovery from an injury, the comp payer often ends up paying to treat that condition as well as the occupational injury. If the diabetic injured worker does have health insurance, the comp payer doesn’t have to pay to treat the diabetes – a key consideration as the condition can dramatically affect recovery from surgery.
- There appears to be a correlation between the availability of health insurance and claim filing, but it isn’t what many think. A 2005 RAND paper notes “uninsured and more vulnerable workers are actually less likely to file claims than the insured.” Why?
“even repeat injury-sufferers are more likely to file during episodes in which their employer offers health insurance, but not statistically more likely to file during episodes in which they themselves are insured. This suggests that the workplace environment and employer incentives may have a significant, or perhaps even the dominant, impact on workers’ compensation filing.”
Next week — more on the impact of PPACA – bet you can’t wait!
Joe, you are very reasonable in your analysis. I am not sure the current government is. I am the workers compensation practice group leader for Aonbenfield. Aonbenfield is a reinsurance broker in the US and we have several clients that are very interested in the healthcare/workers compensation debate. I would like to keep up with your progress on this subject and be of help to you if I can be.