AFL-CIO blasts workers' comp research group as tool of insuranceindustry

By Daniel Hays

The head of the nationally recognized Workers' CompensationResearch Institute and a labor group official are in conflict overthe direction and quality of the studies the WCRI undertakes.

The dispute broke into the open last month when Robert E.McGarrah Jr.–the AFL-CIO's coordinator for workers'compensation–sent a letter to WCRI Executive Director Richard A.Victor slamming the Cambridge, Mass.-based organization as a toolof the insurance industry.

The McGarrah letter said the AFL-CIO had concluded that “WCRI,like the insurance companies it depends upon for its financialsupport, operates to promote the interests of the workers'compensation insurance industry.”

According to Mr. McGarrah, “WCRI's board of directors and itsResearch Committee are almost entirely officers of the majorinsurance companies that sell workers' compensation insurance.”

He complained that the group, in studying state workers' compsystems, relies on insurance industry data that cannot be publiclydisclosed, has failed to study effects of insurance pricing andadministration of workers' comp, and has a flawed peer reviewprocess.

Mr. McGarrah said in an interview that the AFL-CIO isconsidering withdrawing from WCRI activity because it focuses onmanaged care systems and fails to examine other cost-efficientsystems that can provide workers with better treatment.

Mr. Victor in response sent a letter saying he hoped the laborgroup did not intend to end talks concerning possible researchideas, and defended WCRI as the only organization studying bothworkers' comp system costs and worker treatment.

Mr. Victor wrote Mr. McGarrah that he was perplexed because ArtWilcox, a New York AFL-CIO representative, had sent a list oftopics for research, and he was “looking forward to your reactionsto them.”

Mr. Victor said he and his colleagues wanted to continuediscussions and hoped Mr. McGarrah's letter was not intended to endthem. The WCRI, he said, places a high value on diversity ofmembership, including state labor organizations.

According to Mr. Victor, WCRI has “completed about 5,000interviews with injured workers. No other organization has set thispriority and accomplished it.”

Mr. Victor cited research that monitors the timeliness ofpayments to injured workers, and wrote that WCRI “is particularlyproud of its efforts to focus on how the system affectsworkers.”

He added that studies are “only published if peer reviewers, notWCRI members or management, sign off.” He attached letters fromexecutives with the Upjohn Institute for Employment Research andInternational Association of Industrial Accident Boards andCommissions attesting to the honesty and rigor of the group'sresearch.

“We will continue to conduct studies on both the cost toemployers and the outcomes experienced by injured workers,” hesaid. “We hope that we will continue to have input from organizedlabor on both our research agenda and specific studies.”

Mr. McGarrah said he would continue to meet with Mr. Victor,noting they are colleagues on the National Academy of SocialInsurance's workers' comp insurance committee, but said he would bewriting Mr. Victor that his reply is unresponsive to his concerns.“The WCRI needs to broaden its focus to the entire system ofworkers' compensation, which includes the pricing of the product,”he said.

Mr. McGarrah said that Mr. Victor has kept labor involvement inWCRI at a low level “that's inconsequential and failed to give it arole on the group's board of directors or research committee.”

WCRI, he complained, has ignored a variety of medical treatmentstudies such as that done by the Agency for Healthcare Research andQuality. He said WCRI's research is “conventional and behind thetimes.”

According to a WCRI fact sheet, the group does not look atworkers' comp pricing because it has not built the technicalexpertise required due to the fact the group “has limited resourcesand sees no reason to duplicate expertise resident elsewhere.”

Callouts, no mugs:

Point:

“WCRI, like the insurance companies it depends upon for itsfinancial support, operates to promote the interests of theworkers' compensation insurance industry.”

Robert E. McGarrah Jr.

WC Coordinator, AFL-CIO

Counterpoint:

“[Studies are] only published if peer reviewers, not WCRImembers or management, sign off…We hope that we will continue tohave input from organized labor on both our research agenda andspecific studies.”

Richard A. Victor

WCRI Executive Director