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ADJUSTMENT DISORDER: Why Carriers Should Reconsider Strategies For Adjusting Claims Of Depression
Matthew Lewis
Rogers, Booker & Lewis
901 Waterfall Way, Suite 105
Richardson, TX 75080
Given the adoption of the Official Disability Guidelines (ODG) for medical management in the Texas workers’ compensation system, and current Division medical dispute practices and recommendations, it is time for carriers to reconsider how claims involving depression are adjusted. Oftentimes, disputing compensability of depression, especially when it is disputed close in time to the diagnosis, increases the risk and exposure of the carrier unnecessarily. This article will identify an emerging problem with how claims involving depression are handled by carriers generally.
Current Practices
It is not uncommon for an adjuster to receive a medical report diagnosing a claimant with depression. It is also not uncommon for the adjuster to immediately issue a dispute of the carrier’s liability for that condition. Granted, there are many instances when a claimant has a pre-existing psychological disorder, or has received counseling or medication in the past for psychological stressors. It is also true that a diagnosis of depression can be a gateway to costly treatment and indemnity benefits that can be long-term claims costs. So, it has always been understandable that a carrier would want to be very judicious when accepting or denying liability for depression or other psychological disorders.
When a carrier denies liability for a claimant’s depression, there will be no payment for medical treatment associated with that condition until the extent of injury dispute has been resolved through the dispute resolution process at the Division. Over the years, the Appeals Panel has specified when depression is compensable, and when it is not. Appeal 030056 provides a very clear expression of the compensability issues involving depression. In that case, the claimant testified to many stressors leading to his feelings of depression including anger at his treating doctor, financial difficulties following his injury, an inability to work because of his injury, and the inability to workout at the gym. The Hearing Officer determined that the claimant’s depression was the result of circumstances arising out of his injury, rather than a result of the injury itself. It has long been held that if depression is due to the life circumstances resulting from an injury, like financial problems or family discord, or due to claims handling issues or a protracted dispute resolution process, then that depression would not be compensable (Appeal 961449). However, as found in Appeal 030056, if the depression is a result of the injury it is compensable. Whether depression is the result of an injury requires examining whether or not it naturally flowed from the compensable injury. One way to determine whether depression naturally flowed from the compensable injury is to examine whether or not it was the result of pain or functional limitations caused by the compensable injury. If so, the depression itself becomes compensable. Even if there are multiple causes of the claimant’s depression, if one of those causes is the pain and functional limitations resulting from the compensable injury, then the depression may be found to be compensable.
Once a decision is obtained from the Division on compensability of depression, the carrier will adjust the claim accordingly. If the depression is not compensable, the carrier will likely deny reimbursement of medical bills for treatment related to depression. If the depression is compensable, then these bills will likely be paid.
What’s The Problem?
Depression can be a gateway diagnosis to long-term healthcare, including individual psychotherapy, medication, and return to work and chronic pain programs. According to the AMA Guides To The Evaluation of Permanent Impairment, 4th Edition (AMA Guides), depression is a characteristic of chronic pain. If depression is accompanied by enduring pain, that constitutes a presumptive diagnosis of chronic pain syndrome (AMA Guides, Page 308). The Guides state that with chronic pain syndrome, pain-related behavior becomes maladaptive and grossly disproportional to any underlying stimulus, which usually has healed and no longer serves as an underlying pain generator (Page 307). The AMA Guides recommend psychological testing as an integral part of evaluating pain, and rehabilitation of psychological factors, behavior modification and cognitive therapy aided by providers in psychology and psychiatry as treatment protocols.
The ODG does recommend chronic pain programs, and indicates that they should be approved ten sessions at a time. Lower level care can be determined based on the presence of depression as well. Consider that the difference between work conditioning and work hardening is that work hardening should include psychological support and be multidisciplinary in nature. Even ongoing individual psychotherapy and anti-depressants can add up as significant costs over the long-term.
By disputing liability for depression as soon as a claimant receives that diagnosis, a carrier sets itself up to be legally bound for the effects of depression on that claimant for the rest of the claimant’s life. If treatment is not being allowed or if the medical bills are not getting paid because of the dispute of depression, the claimant is likely to pursue the dispute through the dispute resolution process. In addition to establishing a major factor in treatment decision-making for the underlying physical injury, when the Division determines that depression is compensable, the claim must be adjusted to allow reasonable and necessary treatment for the depression itself. The additional claims costs and treatment duration could greatly exceed what would have been had the dispute of liability for depression never been filed.
Why Not Delay The Dispute?
What if the carrier did not file the dispute of depression immediately upon receiving a medical report with that diagnosis? So long as the date of injury for the underlying work injury is more than sixty days prior to the carrier’s receipt of notice of the workers’ compensation claim, then there is no risk of waiving the right to dispute the claimed depression later. Note that the ODG recommends psychosocial screening and psychological testing in the first month of a low back injury claim if there are expectations of delayed recovery or if psychological factors are delaying recovery. Take note that utilization review companies are routinely requiring individual psychotherapy as an exhaustion of lower level care before approving work hardening or chronic pain programs, and ODG recommends these services as behavioral treatment in cases of delayed recovery. Understand that these services are recommended by ODG in the chapters dealing with the physical injuries, not necessarily the chapter on pain or mental disorders.
The question here is: why wouldn’t a carrier want to see what it might be liable for before filing the dispute of compensability of depression? If a carrier is only going to be asked to cover individual therapy, some anti-depressant medication, and work hardening or a chronic pain program, why risk being responsible for depression for the remainder of the claimant’s life? In addition to lifetime reasonable and necessary medical care for depression, by litigating extent of injury and establishing depression as compensable, the claimant becomes entitled to an impairment rating for that condition. The additional impairment for depression could increase the impairment rating enough to create supplemental income benefit exposure.
Any adjuster or carrier representative at this point is probably screaming that the reason to dispute depression is so that the carrier won’t have to pay for the individual therapy, anti-depressants, work hardening or chronic pain program. The problem, though, is that this is an incorrect assumption. Remember, ODG recommends these treatments for the physical injuries, not for depression itself. Additionally, consider the Division’s position on this question, which is well presented in Medical Contested Case Hearing Number 08108. In that decision, the Hearing Officer explains that the medical provider billed for individual psychotherapy, and coded the bill with a diagnosis for the physical injury, rather than depression or a mental injury. The carrier argued that the injury does not include depression or psychological conditions, and that the provider miscoded the treatment by providing codes for the physical diagnosis rather than the psychological component. The Hearing Officer explained that health care providers have been instructed by the Division to the give the primary diagnosis when coding their bills, rather than the secondary psychological diagnosis. As a result, the carrier was responsible for paying for individual psychotherapy even though no psychological component was compensable.
Now, consider what happens if the carrier disputes liability for depression as soon as it is diagnosed, the matter is adjudicated, and the carrier prevails: depression is not compensable; however, the carrier would still be liable for individual psychotherapy, anti-depressants, work hardening or a chronic pain program, so long as the treatment is recommended by ODG, preauthorized, and the provider submits its bills with the primary diagnosis codes and omits the psychological disorder diagnosis codes.
A carrier gains nothing by disputing depression early in the claim. As indicated above, the carrier will most likely still be responsible for the treatment it was trying to avoid by filing its dispute. However, if the carrier waits, pays for the ODG recommended treatment for the physical injury, which might include psychotherapy and multidisciplinary programs, and the claimant recovers and/or moves on with his life, the carrier only paid for what it was going to be required to pay for anyway. If, after the recommended treatment for the physical injury is exhausted, the claimant pursues treatment for the psychological condition only, the carrier could still file its dispute of compensability of the psychological component. The carrier could do the same if the claimant attempts to obtain an impairment rating for depression.
CONCLUSION
If a carrier disputes depression as soon as it is diagnosed, the claimant is likely to pursue adjudication of that dispute, which could lead to reasonable and necessary treatment for depression for the remainder of the claimant’s life. If the carrier prevails, it is not likely that it will be absolved of responsibility for treatment related to depression. If the carrier waits to file its dispute of liability for depression to see if it is necessary to do so, it will most likely incur the same claims costs as if it won the extent of injury dispute, but may avoid the exposure of a compensable psychological condition entitled to lifetime medical benefits and an impairment rating.