By Sally Lett, Legal Nurse Consultant
© 2007 The Medical-Legal News
Healthcare and personal injury claims amount to a tremendous sum for auto insurance companies. Many insurers now review medical bills with computer software to cut costs both in terms of PIP/MedPay, as well as in bodily injury claim payments, particularly those involving soft tissue injuries.
Approximately 70 percent of the auto insurance industry has implemented claims assessment software — Colossus, ACE, ACME, or CCPR — to evaluate bodily injury claims. Some lawyers have learned how to format their demand letters for these programs in order to obtain the highest value for their clients’ claims.
MIST (Minor Impact Soft Tissue)
In the mid 1990s Allstate implemented a claims processing system called CCPR that segmented claims into different divisions that depended on the facts of the case. MIST was so successful in terms of savings that other insurers adopted it.
Typically, when vehicle damage falls below $1,000, claims are routed to the MIST division of the insurance company. There, claims are handled by adjustors who have a limit on the claim payment, often not exceeding $3,000. The company is willing to aggressively defend these claims. The intent is to make lawyers unwilling to accept such cases, therefore leading to lower settlement offers.
Colossus, a computer program, divides injury cases into two categories: demonstrable and non-demonstrable/soft-tissue. Non-demonstrable cases deal with whiplash. The values of factors in such cases are calculated in a different manner than the factors in a demonstrable injury case.
Symptoms known as “complaints” add value to the claim. These include headaches, muscle spasms, restriction of movement, radiating pain, depression and others. Prognosis is a large value-driver.
Disability in terms and methods in Colossus is different from those used by physicians. Physicians consider the client’s job description, physical capacity testing and results from clinical assessment tools. Colossus uses a completely different system called “Duties Under Duress.” To obtain any value for the disability, the injured party’s attorney must specifically address the duties in the demand letter.
Permanent impairment is the second most valuable factor in a Colossus claim, preceded only by the injuries incurred. Colossus calculates values based on the findings of the AMA’s Guides to the Evaluation of Permanent Impairment, 5th Edition. Claims that do not have an AMA impairment rating fail to obtain the highest potential value.
Look at these elements in litigating or defending these software-assessed claims:
• Diagnostic coding should reflect the actual injuries.
• Records should reflect that care was done at a reasonable charge.
• High quality chart notes should reflect the injured person’s clinical treatment schedule and referrals.
• Disability and impairment ratings should be documented. •
Sally Lett, DC, RN, LNC is a Legal Nurse Consultant based in Kalamazoo, Mich.; firstname.lastname@example.org.
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