WORKER'S COMPENSATION: FEES FORCE BUSINESS OWNER TO LAY OFF WORKERS

Greg Howard paid about $6,000 in worker's compensation insurance premiums last year. This year he expects to pay at least $10,000.

Howard, who owns a masonry business in Cape Girardeau, said one of his seven employees recently was injured on the job. He doesn't dispute the worker's claim, but says the medical costs of treating the worker have been unreasonably high, so much that his premiums likely will double.

One example is an $82 bill for the worker's first office visit to a Cape Girardeau doctor, he said.

"If you or I go there, it costs $28, but because this was a worker's compensation claim, it cost $82, just for the visit," Howard said.

Because of his increased premiums, he plans to hire fewer workers next year, he said.

"I've got to make up for it somehow," he said. "The premiums are based on a percentage of my payroll, so the only way to decrease the premiums is to keep my payroll down."

Unlike other states, Missouri has no law regulating medical fees for worker's compensation cases. A "fee schedule," in other states, regulates the amount doctors can charge for certain medical treatments based on the amount insurance companies will pay.

Howard said because Missouri lacks a fee schedule, business owners like him are being taken for a ride by the health care system.

"My insurance company is going to pay for it up front, but Greg Howard is going to pay for it in the long run," he said. "It's a license to steal."

Richard Rousselot, director of the Missouri Division of Worker's Compensation in Jefferson City, said the Missouri Worker's Compensation Law requires that medical fees for injured workers be "fair and reasonable."

Employers and insurance companies can dispute what they feel are unreasonable medical fees at hearings with the Missouri Division of Worker's Compensation, he said. Those disputes are increasing.

"It's a growing problem, not only in Missouri but across the country" he said. "There is no place in (Missouri) law that a dollar number is mentioned in regard to medical fees."

Rousselot said lawmakers are currently looking into establishing a medical fee schedule for worker's compensation claims, but until one is enacted, claims of unreasonable fees will have to be settled with the state or in court.

The Missouri Division of Worker's Compensation will hear Howard's case in three to four months.

A fee schedule is not likely to solve all the problems associated with worker's compensation claims, Rousselot said, "but at least they are working toward some kind of solution to it."

Jack Knowlan, administrative judge with the Cape Girardeau office of the Missouri Division of Worker's Compensation, said medical costs for workers injured on the job are high, but that's because they are part of the overall trend of increasing health care costs.

He said businesses annually face increases of 15 to 20 percent or more in employee health insurance.

Patients with worker's compensation claims are not necessarily charged higher fees, he said, adding that dramatic increases in health care costs carry over into the cost of worker's compensation insurance.

"There may be some doctors' offices that have a higher rate for worker's compensation cases, but I'm not sure that happens," he said.

If it does, the offices likely would justify it based on the increased amount of paperwork associated with such cases, he said. Legal fees might also play a part in the higher cost, he said.

In 1986, the Cape Girardeau branch office of the Missouri Division of Worker's Compensation handled about 1,600 unsettled worker's compensation claims. That number since has more than doubled to 3,700. The office serves a 19-county area.

Knowlan said there are efforts across the state to improve the worker's compensation system, but he isn't sure a fee schedule is the answer.

"There are stacks of proposed bills floating around Jefferson City that deal with worker's comp laws and guidelines, proposed by both employee groups and employers," he said.

"But when you get into regulating doctor's fees, you're getting into a much bigger issue. I don't think they should selectively regulate worker's comp without addressing the whole health care problem."

But Howard said laws regulating medical fees for cases like his will be the only way to keep worker's compensation insurance affordable for business owners. His worker's compensation insurance premiums equal about 9 percent of his company's payroll.

"You can't afford to have it, but you can't afford not to have it," he said.