10 Things Everyone Should Know About Impairment Ratings

When impairment is assessed at maximal medical improvement (MMI), it is turned into a “rating” that is translated into permanent disability payments to injured workers. The AMA Guides to the Evaluation of Permanent Impairment define a structured approach with the goal of verifying a rating is valid and reliable – two physicians should come up with the same rating. Statistics indicate that over 70% of ratings performed by doctors are incorrect.

Ten Things You Need to Know

1. Impairment ratings are the measure of the loss of medical functionality at maximum medical improvement. They are typically based on the AMA Guides to the Evaluation of Permanent Impairment which is used in over 40 states and throughout the federal system as the starting point to arrive at a permanent partial disability payment.
2. Impairment ratings drive an estimated $20 billion costs in state workers’ compensation systems.
3. Most cases should be at maximal medical improvement (MMI) within one year and, therefore, ratable. This is usually the optimum trigger to drive case closure.
4. Most impairment ratings are erroneous – typically twice what they should be – and most of the time these errors are missed. Potential lost cost is typically over $10,000 per claim.
5. Physicians do not learn how to rate impairment in medical school or residency; therefore, the vast majority of physicians do not know how to assess impairment or disability. This is even truer for adjusters and lawyers.
6. Treating physicians often inflate ratings in their advocacy role for their patients – resulting in needless impairment and disability costs (human and financial).
7. The process of assessing impairment has evolved – the most current standard is the Sixth Edition of the AMA Guides to the Evaluation of Permanent Impairment; this is used by a minority of state jurisdictions and used by the Federal government within the Office of Workers’ Compensation Programs (FECA).
8. It is not reasonable to expect adjusters to be able to reliably identify and fix erroneous ratings – this is a specialty skill and requires interaction with physicians knowledgeable in the use of the Guides.
9. There are specific interventions, often jurisdiction specific, which will result in reduced errors.
10. Recognizing and managing erroneous impairment ratings typically provides several fold return on investment (ROI) – Impairment Resources, LLC has unique solutions consistently achieving this ROI.

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If you are interested in seeing how your claims management system is scoring in this critical area, contact Impairment Resources, attention Candace LaChapelle at clachapelle@impairment.com or call her toll free at 866-848-9205. http://www.impairment.com

Author: Candace LaChapelle, Vice President of Business Development.

Impairment Resources, LLC (formerly Brigham & Associates), provides its clients with unique, proven strategies that drive accurate impairment ratings and result in a superb return on investment. IR combines the expertise and resources of national leaders in the areas of the AMA Guides to the Evaluation of Permanent Impairment, workers’ compensation cost containment, and recovery services. With offices in Portland, Maine; San Diego, California; and Kailua, Hawaii, it offers a proprietary suite of products and services, educational resources, training, certification and strategies to produce quality ratings.

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Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workers’ comp issues.

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