Workers’ comp: The dark corner of medicine

An article in the New York Times sheds a little light in a dark corner of medicine, the world of workers’ compensation. In particular, it highlights a world of doctors that dispense drugs in their offices, which improves both patient satisfaction and profits.

Though fraudulent insurance claims are always easy headline-grabbers, the real world of workers’ comp is complex and not always so tailor-made for sound bites.

Add to this mix the medical industry’s role.

Doctors in practice loathe disability evaluations. They are time-consuming and require several pages of documentation. After more than a decade in practice, I still fear the repercussions of these assessments.

I’m inclined to want to advocate on behalf of my patients, especially when I know them and trust their stories.


  • What if the patient is malingering and I’m unable to ascertain that? That makes me feel as if I’m party to fraud.
  • What if the patient is truly disabled and my assessment fails to further their claim? That makes me a failed advocate.

Primary care doctors typically have no specialized training in conducting disability evaluations, and even less understanding of the byzantine world of workers’ compensation.

As a result, most insurance companies now make claimants get evaluated at specialized occupational medicine centers, where the practitioners know exactly what to test for and how to document it to the satisfaction of the insurance companies. Yet there are always unintended consequences to this.

One example, as pointed out in the Times article, is that private equity funds have invested in companies that package or distribute drugs to doctors’ offices. It seems that practices specializing in the business of workers’ comp are particularly suited to be recipients of this investment.

What could private equity be doing in this realm, you ask?

Let’s just say they’re not in it to carry on the traditions of Hippocrates; rather, they see a handsome profit opportunity.

Turns out that most states (43 of them) allow doctors to dispense drugs, and in addition set their own prices on the medication. A handsome mark-up opportunity is thus enabled!

Don’t the patients see through this price-gouging, you ask?

Here’s the rub. Most of the time, health insurance (particularly the company’s workers’ comp insurance) foots the bill. So the patients don’t care! They’re just happy to get medicine as soon as possible after having been evaluated. Besides, so what if the overcharging sticks it to the workplace in which the patient was injured?

Some states have recognized this naked profiteering for what it is. Amazingly, California and my home state of Oklahoma are two of the states that have passed laws forbidding the huge markups.

Let’s face it. When the governments of these two vastly different states are both calling out corruption, you can bet there’s something rotten going on.

John Schumann is an internal medicine physician who blogs at GlassHospital.

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  • Erin Kadeg Tolbert

    I have worked as a nurse practitioner in an urgent care clinic providing worker’s comp and I can assure you there is “something rotten” going on. This happens on both the patient and provider end of worker’s comp visits. On the clinical side, I have been pressured to prescribe medications provided by the clinic rather than more appropriate alternatives. These medications cost significantly more in the clinic than they do in the pharmacy. On the patient side, I have been told by employees “I am not going to be better by Christmas or New Years, so you might as well give me a two-week work note so I don’t have to come back to the clinic over the Holidays”. Worker’s comp patients have no incentive to improve and are not paying their own medical bills leading to unnecessary medical visits and expensive diagnostic testing. No wonder investors are getting involved.

  • southerndoc1

    “I’m inclined to want to advocate on behalf of my patients”
    But that’s not what a workers’ comp doctor should be doing.
    The conflict of interest is too great: primary care docs should not be doing workers’ comp evaluations on their patients.

  • Chrys

    I disagree with Erin’s comment, no offense to you Erin. Your views come from you working on the clinical side of the situations. I can see both sides. Yes, there may be some that abuse the system, but it does an injustice to those that were injured and need an advocate.

    Employers do try to “get rid of these employees” instead of helping them to recover (Which is the right thing to do). After all….these people were working! They were providing for themselves and their families, that’s how they got hurt! They weren’t hanging out eating bon bons. They were productive members of society. It is a horrible system. It is not a cake walk for those injured and having to navigate through it. These people are staked out, stalked, photographed, and filmed. They are forced to seek medical care that is not always necessary, and it isn’t the patients doing -it’s the Ins. Co.s not happy with a physician’s assessment, so they repeatedly send these workers to different IMEs: which can cost them a thousand dollars a clip, not to mention, sending them for expensive scanning, which will cost more on top of that. Yet, they choose to physician shop until they get the evaluation they want. They will drag this process on for, sometimes, the lifetime of the patient.

    They will delay, deny and refuse proper care that is being requested by the treating physician, thus tying that physician’s hands, so he is unable to treat his patient the way he knows best. How does the patient heal correctly when care is delayed or denied and the physician is being kept from getting that patient better, so all involved can go on with living productive lives?

    The system is geared to make it very difficult on a patient trying to recover from injury. If they are trying to get better and try to do tasks they couldn’t do before and are filmed trying them, then they are subject to being accused of fraud. How does one get better, if they don’t try to improve for fear of being called a liar? The stalking involved in these cases has the same psychological effects as having an unwanted admirer. The system is not a free ride.

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