A new report indicates that there may be some problems with the current impairment rating methodology in workers’ compensation.

The study, conducted by Brigham and Associates, Inc. (www.impairment.com) reveals continuing problems with erroneous impairment ratings, specifically the AMA Guides to the Evaluation of Permanent Impairment, which is the recognized international standard used to quantify the impact of an injury and disability.

For a two year interval, from June 2006 through June 2008, experts in impairment assessment associated with Brigham and Associates, Inc. reviewed 2,798 impairment rating reports authored by other physicians and chiropractors. The experts disagreed with 2,169 of the ratings (78 percent). Of these reports that were judged to be incorrect, the average original rating was 20.4 percent whole person permanent impairment, and the average re-rating by the expert was 7.3 percent whole person permanent impairment.

The vast majority of the disagreements related not to difference in judgment, but rather failure to follow specific protocols defined in the Guides. Numerous errors were encountered, with some of the more common issues including rating clinical data that was unreliable (e.g. rating for motion or neurological findings that are inconsistent with other documentation); rating by the wrong method (e.g. rating spinal injuries by the Range of Motion method when the Diagnosis-Related Estimates method was required); rating by methods prohibited for specified conditions (e.g. rating carpal tunnel syndrome on the basis of grip strength loss); combining multiple methods that cannot be combined (e.g. combining lower extremity impairments for motion and strength loss); adding values that should be combined; and evaluating physician bias. Of the 629 ratings that were deemed appropriate, the ratings averaged 8.9 percent whole person permanent impairment. Therefore, for these cases reviewed, 57 percent of the total value assigned to impairment ratings was not supportable by the data provided.

A review of 95 sequential, unselected cases referred by a California insurer of impairment evaluations performed in 2008 revealed an error rate of 93 percent. Of these cases, the average original rating was 16.7 percent whole person permanent impairment, and the average expert re-rating was 5.9 percent whole person permanent impairment.

In California, the impairment value is adjusted by Future Earning Capacity factors, occupation, and age. For these 95 cases, the difference in dollar value assigned for the Permanent Disability rating based on the original ratings versus the corrected ratings was $1.2 million dollars. This suggests that the magnitude of erroneous ratings is not due to reviewing only cases referred due to suspected errors. Rather, it reflects significant problems with undetected erroneous ratings.

This study confirmed the need for improvement in assuring accurate and unbiased impairment ratings, and the need for expert review to assign accurate impairment ratings.