PT Classroom - Trends in Worker’s Compensation Rehabilitation ׀ by Jim Mecham, MSIE, OTR/L, CPE


Jim Mecham has dedicated his career to developing comprehensive industrial rehab programming that returns an injured worker to work as soon as possible and providing organizations with injury cost reduction services that positively influence their bottom line. His background in Occupational Therapy and Industrial Engineering provides a perfect fit to prevent work related injuries through engineering controls and rehabilitate workers following an injury. Jim is a board certified ergonomist and has been awarded this certification through the Board of Certification in Professional Ergonomics. Jim’s extensive experience in the field of industrial ergonomics includes providing consulting within manufacturing and office environments nationwide while developing and implementing comprehensive ergonomic initiatives for large and small employers. Jim developed the OccuPro’s Online Assessment Application software which includes the highly profitable Functional Progress Notes and Functional Discharge Summaries.

Trends in Worker’s Compensation Rehabilitation

Are Functional Capacity Evaluations profitable? Why do private practice owners think FCE’s are the first step to starting an industrial rehab program? Many private practice owners have seen a decrease in FCE and work hardening/conditioning referrals. What can I do to correct this?

When treating the worker’s compensation patient, why do therapists concentrate on musculoskeletal goals/re-assessments while omitting function? Medicare documentation requires addressing function so why don’t we do this for the worker’s compensation client? Why do therapists only communicate with the physician in regards to the workers compensation patient’s progress? What about the employer, the one ultimately paying the bills?

Private practice owners who are mildly interested in implementing industrial medicine programs are hesitant because they do not know if they will receive referrals and generate revenue. If your practice sees 10% or more outpatient worker’s compensation patients and you do not perform industrial rehab you are missing the boat in regards to financial success.

Within 95 percent of the United States, workers' compensation insurance reimbursement is increasing. The most successful private practices specialize in treating worker’s compensation patients primarily due to their focus on providing high level services within the best paying insurance.

A traditional therapy practice treats work comp patients from initial evaluation to discharge while focusing on range of motion and strength. A clinic that specializes in the treatment of the injured worker treats functionally from the initial eval and discharges these patients only when they are ready for full duty return to work.

The most challenging aspect of working within this field for the last 15 years and discussing its implementation into a private practice has been owners treating industrial rehab as a secluded specialty program. However, when they understand that they should be treating a workers compensation patient as if they were in an industrial rehab program from the initial evaluation their clinics become local specialists in the treatment of the injured worker and will ultimately reap significant financial success.

Several years ago, I implemented industrial rehab into a 15-clinic private practice. In order to accomplish the owner's financial goals, we needed to ensure that the culture of the company supported this program. Seventy-five therapists needed to be trained to implement the industrial rehab philosophies starting with their initial evaluation which needed to focus on return to work immediately and provide re-assessments that functionally tested patients during outpatient therapy. These therapists were not going to be the industrial testers but needed to be therapists that specialized in the treatment of the injured worker during traditional outpatient therapy.

The first step was to create a form to be used during the first visit in which the patient documented the functional aspects of their job. These were then turned into the therapist's long-term return-to-work goals. Rather than write a musculoskeletal progress note to the physician during therapy, the therapist tested the injured joint or body part to assess functional progress.

The success of this program did not rely on the hope that doctors would start referring Functional Capacity Evaluations or work hardening / conditioning patients. This approach allowed clinics to start billing for industrial rehab services immediately because of the implementation of Functional Progress Notes and Functional Discharge Summaries.

When clinically appropriate, the therapist performed a functional test on the injured joint or body part to see how close it was to full duty return to work. This testing doesn't require insurance approval or a physician's order, since its performance doesn't differ from a musculoskeletal progress note. Functional re-assessments can be performed on every outpatient workers' compensation patient and 99% are reimbursed without question.

Following the functional test, a therapist summarizes the client's functional return-to-work abilities and makes a return to work recommendation. This functional testing helps to determine the next course of therapy which more often then not would be a rehabilitation recommendation that supported work hardening/conditioning.

The reports are then submitted to the physician, insurance company and employer. Yes, the employer! You would never send a musculoskeletal progress note to an employer, but a Functional Progress Note speaks the language an employer understands. In turn, the clinic is marketing its workers' compensation specialty to the employer who appreciates a document that speaks their return-to-work language. In my experience, injured employees returned to work quicker and employers saw the private practice as a local specialist, which opened discussions about other cash based services they offered.

The most profitable aspect of this functional approach included an immediate proactive referral base to the work hardening/conditioning program. Twenty percent of their outpatient work comp patients were self-referred to this program secondary to the treating therapists focus on return to work function. Although many therapists continued to test the musculoskeletal improvements, they discovered that even with 5/5 strength and full range of motion, patients still couldn't perform the functional aspects of their job. Once they realized this, the objective functional testing supported a work hardening/conditioning recommendation and insurance carriers had little cause for denial.

Clinics interested in implementing industrial rehab into a practice often express investment concerns and are afraid they won't receive patient referrals. However, clinics incorporating these functional tests shouldn't be concerned. If you already treat workers' compensation patients you can perform these tests today and begin making a return on an industrial rehab program investment immediately.

Functional Progress Notes and Functional Discharge Summaries bill using CPT 97750 (physical performance test and measure) and can be performed by physical therapy assistants, certified occupational therapy assistants and certified athletic trainers. The charge ticket for this re-assessment is 50 to 100 percent higher than a normal ticket.

Private practice owners should take a hard look at their industrial rehab programming. Clinics throughout the United States have reported a decrease in industrial referrals. This proactive industrial rehab approach will boost your referrals and significantly enhance it financially. Within the first year clinics on average see a 400% increase in industrial rehab revenue following the implementation of this innovative approach. If you want to increase revenue and maximize reimbursement, you must improve workers' compensation services by setting specific return to work goals and assessing return to work function during outpatient therapy.


To learn more about industrial rehabilitation please contact Jim at or (866) 470-4440.
Last revised: December 23, 2010
By Jim Mecham, MSIE, OTR/L, CPE

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