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Regulated networks of doctors, similar to the health maintenance organizations in managed health care, would treat workers injured on the job under a bill designed to overhaul Texas’ workers’ compensation system. S.B. 5, filed on Jan. 13 by state Sen. Todd Staples, R-Palestine, Texas, would add Chapter 1305 to Subtitle D, Title 8, of the Texas Insurance Code, to authorize establishment of physician networks, which the Texas Department of Insurance would certify. Austin attorney Joe Anderson, who represents workers’ comp insurance carriers, says the physician networks are the most important aspect of S.B. 5. “That’s the 800-pound gorilla in the room,” Anderson, a partner in Burns, Anderson, Jury & Brenner, says of the networking proposal. Anderson says his clients are concerned about “skyrocketing” medical costs and the perceived over-utilization of doctors’ services in the workers’ comp system. Insurers see physician networks as a way to control the costs, he says. “High medical costs are the proverbial Sword of Damocles dangling over everybody’s head,” Anderson says. The average cost of a worker’s compensation claim in Texas increased almost 35 percent between 1999 and 2003, the TDI Workers’ Compensation Research Group reported last year. Richard Pena, an Austin attorney who represents injured workers, says he’s “very leery” about creating physician networks in the workers’ comp system. “Insurance companies will probably select the doctors on the networks,” says Pena, principal in the Law Offices of Richard Pena. LITTLE CHOICE Rick Levy, legal director of the Texas AFL-CIO and a shareholder in Austin’s Deats & Levy, says he’s concerned about the extent of choice that injured workers will have in selecting doctors if networks are created. Levy says he finds it troubling that an injured worker might be forced to see a doctor in whom he or she has little confidence. Under S.B. 5, injured workers could choose their doctors within a network, but an insurer wouldn’t have to pay for an out-of-network doctor’s services to a worker. Levy says the bill requires a network to have “adequate” care available in different specialties. “The question is, what does that mean,” he says, adding that the provision needs to be fleshed out. Pena and Anderson, who have represented clients in Texas’ workers’ comp system since before the Legislature revamped the system in 1989, agree the system is in crisis. But they disagree about the causes of that crisis. “I think it’s an area in crisis because of the overbearing presence of the insurance industry,” Pena says. Pena says insurance carriers frequently deny injured workers’ claims for months because insurers face no penalty for doing so. He favors allowing injured workers to settle claims with insurers, as they could before the Legislature’s 1989 overhaul, which eliminated injured workers’ right to sue employers who carry workers’ comp coverage. The Legislature changed the system to stop lawyers from representing workers, he contends. “When the law changed, everybody thought comp is dead as far as lawyers are concerned,” Anderson says. That has not been the case, Anderson says, noting that the Texas Board of Legal Specialization (TBLS) recently created a new certification for workers’ comp law. Gary McNeil, TBLS executive director, says the board certified the first group of lawyers in workers’ compensation law in late 2004. Anderson, who says insurers pay most injured workers’ claims, cites other factors he believes have caused the crisis. Texas has higher medical costs and its injured workers are off work longer than those in others states, Anderson says. The Workers’ Compensation Research Institute’s 2004 comparison of 12 states found that the average payment per medical claim in Texas amounts to $9,314 — almost 40 percent higher than the median of the 12 states. The institute, an independent, not-for-profit research organization based in Cambridge, Mass., looked at a number of other economically competitive states — such as California, Florida, Pennsylvania and Illinois — in addition to Texas to do the comparison. “No one was satisfied with the current system,” says Staples, who chaired the Senate Select Committee on Workers’ Compensation that looked at problems in the system and recommended solutions, including the creation of physician networks. Allowing the establishment of such networks would encourage more doctors to treat injured workers by reducing the hassles in the current system, Staples says. Dr. David Henkes, a San Antonio pathologist and chairman of the Texas Medical Association’s Task Force on Workers’ Compensation, says doctors have more hassles with workers’ compensation than with any other type of insurance. Henkes says doctors have to set up an entirely different system in their offices just to administer workers’ compensation claims. While Henkes calls S.B. 5 “a good start” toward improving the system, he says, “We don’t think networks will be the silver bullet to fix workers’ compensation.” But Levy says, “In all likelihood, some form of network will be passed by the Legislature.” The Texas Workers’ Compensation Commission, which administers the system, included establishment of health-care provider networks in its November 2004 recommendations to the Legislature. State Rep. Burt Solomons, R-Carroll, Texas, chairman of the Sunset Advisory Commission, which scrutinizes each state agency at least once every 12 years, says he will include a network provision in the TWCC sunset bill that he’ll file later this month or in early February. The bill by Solomons, of counsel at Bell, Nunnally & Martin in Dallas, will differ from Staples’ bill in several respects. S.B. 5 would reduce the TWCC from six commissioners to one and would rename the agency the Texas Department of Workers’ Compensation. Solomons says his bill would abolish the TWCC and reassign many of its duties to the TDI, which is headed by one commissioner. John Davis, an attorney who represents injured workers, says TWCC’s current structure provides three commissioners who represent employers’ interests and three who represent workers’ interests. If the Legislature reduces the commission to one commissioner, that person probably is not going to be somebody who is interested in injured workers, says Davis, the principal in San Antonio’s J.A. Davis & Associates. “This is going to be a real difficult session for injured workers,” Davis predicts.

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