By Alexandra Hall, Wisconsin Public Radio and Dee J. Hall, Wisconsin Center for Investigative Journalism
As an administrative law judge hearing worker’s compensation cases in Wisconsin for three decades, Joe Schaeve said he often knew how certain doctors hired by employers and insurance companies would rule even before opening their reports.
“It winds up with the doctor saying ‘Not work related’ or ‘It’s all in his mind,’” said Schaeve, who retired last May. “You can almost sense it coming when you spend 30 years reading these reports.”
Schaeve said a few of the experts’ opinions were so predictable that “it’s almost a waste of time to read the report because you know what it’s going to say.”
Those reports came from “independent medical examiners,” or IMEs. These doctors are hired by employers or insurance companies seeking to dispute claims for lost wages, extent of disability, loss of earning capacity and necessity for treatment.
{This report is part of Broken Whistle, a series that explores Gov. Scott Walker’s attack on waste, fraud and abuse and the dwindling protections and incentives for whistleblowers in Wisconsin. The series was reported in part by an investigative reporting class at University of Wisconsin-Madison’s School of Journalism and Mass Communication taught by Dee J. Hall, managing editor of the Wisconsin Center for Investigative Journalism. The Center’s collaborations with journalism students are funded in part by the Ira and Ineva Reilly Baldwin Wisconsin Idea Endowment at UW-Madison.}
Worker’s compensation is often called the “grand bargain” because it bars employees from suing for workplace injuries with few exceptions. In exchange, employers must pay for lost wages, medical care and any resulting disabilities, regardless of who is at fault for the injury.
Such claims can cost hundreds of thousands of dollars for severely injured workers and can increase the cost of worker’s compensation insurance for employers. In a few hundred cases each year in Wisconsin, the extent and cause of those injuries is disputed.
In disputed cases, it can come down to dueling doctors — the findings of an injured worker’s treating physician against the opinion of an IME whose decision is then used by employers to deny compensation to injured workers. This forces the workers to fight for their benefits.
Critics have said that some IMEs’ reports may be influenced by the fact they are paid by employers and they therefore may downplay or deny the work-related aspects of injuries. Others, however, see the possibility of bias on both sides and approve of at least the concept of the competing medical opinions.
Jeff Klemp, an Eau Claire attorney who represents injured workers, is one person who thinks the system is a good one, at least in the abstract, because it gives employers and insurers the right to hire their own experts to evaluate claims.
“The concept of an IME is a good concept,” Klemp said. “The Legislature created this rule that insurance companies can send an injured employee to a doctor of their choosing. And on its face, you think that’s a good idea, let the insurance company get an objective evaluation here.”
The problem, according to critics of the system, is that the IME evaluations requested by insurance companies and employers are not always objective. IMEs review medical records and in some cases examine the injured worker, but critics say this isn’t always done prior to forming an opinion.
In Wisconsin, IMEs do not have to be licensed by the state, so some of them travel from outside the state. Some IMEs “fly in on their charter jet from Kentucky or whatever and they see 20 people for 10 to 15 minutes at a time, they dictate their reports on the plane ride back, and they just made $20,000,” said Luke Kingree, an attorney who represents injured workers in Eau Claire and Madison.
Skepticism regarding IMEs’ reports
As a judge, when he saw a report from an out-of-state doctor, “my antennae immediately pop up,” Schaeve said. “At first glance, it tells me the insurance company knows — underline knows — they’re going to get a favorable report.”
Schaeve said IMEs examined patients for as little as three minutes — or not at all. They often found that the injury was pre-existing, or in some cases, that the symptoms were exaggerated or unrelated to a verified work injury or that the worker had already healed.
For some physicians, conducting such examinations is their main line of work.
Court records show that in 2012, Milwaukee-area IME neurologist Dr. Marc Novom said 80 to 90 percent of his income came from IME work; in another case that year, he estimated that his annual income was at least $450,000. A woman answering the phone at Novom’s office said he is on vacation until May but that she would pass along a message seeking comment.
Klemp said such financial incentives can color a physician’s evaluation of an injured worker.
“Now if the business was turning out IME reports that consistently favored employees or agreed with the employee’s treating physicians, that business would not survive very long,” Klemp said.
The O’Brien brothers
Several worker’s compensation attorneys interviewed by the WCIJ mentioned brothers Timothy S. and Thomas J. O’Brien as out-of-state orthopedic doctors who routinely work for insurance companies. Timothy lives in Colorado and Thomas resides in Tennessee. Phone messages, as well as faxes sent to the IME broker for whom they work, were not returned.
Both doctors’ findings have at times been rejected by the state Labor and Industry Review Commission (LIRC), which decides appeals of administrative law judge decisions. In one 2008 case, the commission found Thomas O’Brien’s denial of the cause of a worker’s low back injury “incredible.”
In a 2016 decision, the LIRC rejected a finding by Timothy O’Brien denying that a worker had suffered a rotator cuff tear when the semi-trailer he was driving jackknifed. O’Brien’s opinion — seconded by another insurance company-hired doctor — contradicted several treating physicians and magnetic resonance imaging. The commission ordered the employer to pay for shoulder surgery after finding that the MRI showed ”objective proof of injury.”
Both O’Brien brothers are licensed in the state of Wisconsin. In 2015, Thomas O’Brien was issued a private administrative warning after a complaint was filed against him, according to a state Department of Safety and Professional Services record obtained by the Center. The Tennessee Department of Health lists a 2008 malpractice settlement of $75,000 or more involving Thomas O’Brien.
Timothy O’Brien, testifying in 2017 in a Wisconsin case, acknowledged that a fellow member of the American Academy of Orthopaedic Surgeons had filed a confidential grievance against him alleging a violation of that group’s standards for performing IMEs. He said the complaint, filed in 2012 or 2013, was “apparently” resolved.
Bias on both sides
Recently retired Milwaukee attorney Bill Sachse, who represented insurance companies and employers, said he looked for credible physicians to “provide the best record in favor of our client.” Some of them, including the O’Briens, are based out of state.
Sachse noted that some treating physicians also may have a financial incentive. Wisconsin is among just six states where there are no set fees for treating patients under worker’s compensation. Powerful business interests are pushing lawmakers to create limits for such cases.
Sachse said he had a recent case in which a surgeon would have charged $200,000 under worker’s compensation to repair a work-related injury. But if it were found not to be work related, the charge would be $50,000.
“So the doctor offering the opinion favorable to the employee had $150,000 on the line in that case,” Sachse said. “Don’t you think he might have been biased? I think so.”
Samuel D. Hodge Jr., a professor of law and anatomy at Temple University in Philadelphia, said he sees bias on both sides. Hodge has studied the rights and responsibilities of IMEs toward patients across the country.
Schaeve, the retired administrative law judge, said he saw little bias by treating physicians. And there is at least one important difference between the doctors on each side of these cases.
Doctors who treat patients have an ethical obligation to give competent care. But Wisconsin is among the many states where an IME is not considered part of a doctor-patient relationship, which means applicants cannot sue IMEs for medical malpractice if they misdiagnose an injury or illness.
Despite — or perhaps because of — what he perceives as biases on both sides, Hodge believes the adversarial system of dueling experts largely works because “I don’t know how else you would do it.”
The president of the New Hampshire-based Workers’ Injury Law & Advocacy Group said use of the term independent medical examiners can fool workers into accepting “biased” diagnoses and dissuade them from pursuing benefits to which they are entitled.
“The concern is a worker just won’t pursue their rights,” said Amie Peters, whose group advocates for injured workers.
Some states have moved away from the term “independent medical examination.” Delaware has banned use of the term in worker’s compensation cases when the physician is hired by an insurance company or employer. Violators are subject to a $500 fine.
OSHA: Worker’s comp system ‘broken’
There are questions about whether the “grand bargain” of worker’s compensation continues to hold. The Occupational Safety and Health Administration concluded in a 2015 report that the worker’s compensation system is “broken,” with employers and insurers covering just 21 percent of the cost of the estimated three million serious workplace injuries and illnesses a year.
About half of the cost is borne by the injured workers, OSHA found — plus a 15 percent decrease in future earnings — while taxpayers, through programs such as Medicare, Medicaid and Social Security, paid at least 16 percent of the cost.
A recent story by the Center found other problems, as well. Although Wisconsin’s system is one of the oldest and most respected, the Center found injured workers have faced a harder time qualifying for worker’s compensation in front of Gov. Scott Walker’s Labor and Industry Review Commission.
Schaeve said he and the political appointees on the LIRC sometimes reached opposite conclusions when it came to the extent and cause of a worker’s injury.
“There are times where I wondered, did we read the same set of medical evidence?” Schaeve said. “Or did we — LIRC and I — look at all the same facts and evidence in the case? Because it looks like all the evidence and the outcome they came out with is foreign to what I came out with.”
Alexandra Hall is the Mike Simonson Memorial Investigative Reporting Fellow embedded in the Wisconsin Center for Investigative Journalism’s newsroom. Dee J. Hall is the Center’s managing editor.
The nonprofit Center (www.WisconsinWatch.org) collaborates with WPR, Wisconsin Public Television, other news media and the UW-Madison School of Journalism and Mass Communication. All works created, published, posted or disseminated by the Center do not necessarily reflect the views or opinions of UW-Madison or any of its affiliates.