REGULATORY ANALYSIS
FOR PROPOSED REPEAL AND READOPTION OF THE WORKERS’ COMPENSATION RULES OF PROCEDURE
7 CCR 1101-3

1.	Description of the classes of persons who will be affected by the proposed rules, including classes that will bear the costs of the proposed rules and classes that will benefit from the rules.

This rule applies to all persons and entities subject to the Colorado Workers’ Compensation system, including but not limited to, injured workers, employers, health care providers, insurance carriers, and self-insured entities.

2.	Description of the probable quantitative and qualitative impact of the proposed rule, economic or otherwise, upon the classes of affected persons.

The revised Lower Extremity (Exhibit 6) Medical Treatment Guidelines includes changes to terminology, procedures and recommendations for updated diagnosis, testing and treatment procedures for injured workers. The changes to the exhibit will make it more consistent in concept and organization with respect to the other exhibits contained in Rule 17.

The treatment guidelines provide guidance to medical providers when making recommendations as to the appropriate treatment.  Similarly these documents provide guidance to the injured worker, insurance companies, and third party administrators on recommended treatment, diagnostic procedures, etc., in cases of lower extremity injury. 

The complexity of diagnosing specific lower extremity disorders has increased since the last update.  In response, the sections and subsections relating to diagnostic procedures have been expanded.  The text includes suggestions and recommendations as to which diagnostic procedure(s) might be most appropriate for a specific disorder or condition.  These changes in the diagnostic procedures sections should further aid in the diagnosis of a work-related injury and therefore initiate treatment that is more applicable to the diagnosis, ultimately leading to a positive influence on cost and quality of treatment.
 
In general, effective medical treatment guidelines serve to make the system operate more efficiently.  Their utilization should have a positive impact on return to work, costs (both personal and monetary) of temporary or permanent disability, and in some cases, survival.  

3.	Probable costs to the agency and other agencies of the implementation and enforcement of the proposed rule and any anticipated effect on state revenues.

    	No additional costs are anticipated.

4.	Comparison of the probable costs and benefits of the proposed rules to the probable costs and benefits of inaction.

Medical Treatment Guidelines required updating to ensure that treatment recommendations are reasonable and necessary.  Recommendations on diagnostic and therapeutic interventions quickly become obsolete as medical technology advances.  As the efficacies of interventions are explored through the medical literature, changes on recommendations undoubtedly occur.  New technologies may incur higher initial costs, but good-quality medical studies can demonstrate favorable treatment outcomes, which may enable the injured worker to return to work sooner or suffer reduced permanent impairments.  Regularly updated medical treatment guidelines provide some important ‘tools’ for the public:  1) the ability to ensure reasonable and necessary care for the injured worker, 2) a guide for the healthcare provider on recommendations and standards of care for the individual patient, 3) a mechanism for the insurer to question and be informed of diagnosis and treatment procedures. 

There are two Workers’ Compensation Rules of Procedure that rely in part on updated treatment guidelines.  Rule 16 (Utilization Standards) requires that medical care and treatment procedures that do not fall within the medical treatment guidelines be subject to prior authorization.  Rule 10 (Medical Utilization Review) provides a vehicle in which the treatment rendered by a healthcare provider to a workers’ compensation claimant may be professionally reviewed on issues of whether such treatment is reasonable and necessary. Additionally, Rule 17 (Medical Treatment Guidelines), and Rule 18 (Medical Fee Schedule), are somewhat interdependent in that time parameters, frequencies, and terminology of the two rules should not conflict and create confusion.  

5.	Determination of whether there are less costly or less intrusive methods for achieving the purpose of the proposed rule.

There were no known less costly or intrusive means to achieve the rule’s purpose.

6.	Description of any alternative methods for achieving the purpose of the proposed rule that were seriously considered by the agency and the reasons they were rejected in favor of the proposed rule.

The adoption of medical treatment guidelines is required by statute.  Having treatment guidelines in place help to ensure reasonable and necessary care and also help to control costs.  The updates to the treatment guidelines in this proposed rule are based on medical evidence and consensus.   

The Colorado Medical Treatment Guidelines have been referenced in the Official Disability Guidelines.  They have been recommended in the Western Occupational and Environmental Medical Association Quarterly Newsletter (Spring, 2005).  Other state Workers' Compensation systems have adopted some of the medical treatment guidelines, either in part or in their entirety.  Such national stature is due in part to the regular updating of the medical treatment guidelines.

Copies of the Notice of Public Hearing were provided to the:

	Colorado Association of School Boards 
	Colorado Counties, Inc. 
	Colorado Municipal League 
	Special District Association of Colorado 
	Colorado Hospital Association 
	Colorado Association of Commerce and Industry 
	Mountain States Employers Council 
	Colorado Self-Insurers Association 
	Colorado Medical Society