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The American Journal of Managed Care December 2006 - Special Issue
Value-based Insurance Design: Aligning Incentives to Bridge the Divide Between Quality Improvement and Cost Containment
A. Mark Fendrick, MD; and Michael E. Chernew, PhD
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Impact of a Musculoskeletal Disability Management Program on Medical Costs and Productivity in a Large Manufacturing Company
William B. Bunn, III, MD, MPH, JD; Robin S. Baver, MD, MPH; Thomas K. Ehni, MD, MPH; Allan D. Stowers, PhD, MS, BS Pharm; David D. Taylor, AIC, ARM, CWCP; Anita M. Holloway, MD, MBA; Duyen Duong, PharmD; Dan B. Pikelny, MA, MBA; and David Sotolongo, BS

Impact of a Musculoskeletal Disability Management Program on Medical Costs and Productivity in a Large Manufacturing Company

William B. Bunn, III, MD, MPH, JD; Robin S. Baver, MD, MPH; Thomas K. Ehni, MD, MPH; Allan D. Stowers, PhD, MS, BS Pharm; David D. Taylor, AIC, ARM, CWCP; Anita M. Holloway, MD, MBA; Duyen Duong, PharmD; Dan B. Pikelny, MA, MBA; and David Sotolongo, BS

Objective: To evaluate a program to reduce musculoskeletal disability-related absenteeism at a North American manufacturing facility.

Study Design: Staged communication and educational interventions targeting physicians to improve care of musculoskeletal conditions and reduce related absenteeism.

Methods: The program was implemented in three 1-year stages. The first stage required physicians to complete assessment forms for employees claiming disability because of musculoskeletal injuries. The second stage added physician education programs focusing on current clinical guidelines. The third stage incorporated local physician education about the facility's onsite physical therapy program. Annual number of work-related injuries, days lost per injury and per scheduled full-time-equivalent (FTE) employee, lightduty days per injury, average annual indemnity per FTE, indemnity per injury, medical costs per FTE, and medical costs per injury were examined to determine the program's effectiveness.

Results: Overall productivity improved by a mean of 12.5 days per injured employee. Mean days lost per work-related injury decreased from 35.1 to 27.6. Number of light-duty days increased from 6.1 to 11.1 per work-related injury. Mean annual indemnity per work-related injury decreased from $9327 to $4493; mean annual medical costs per work-related injury decreased from $4848 to $2679. The annual incidence of musculoskeletal injuries declined by up to 50%.

Conclusions: This intervention was associated with reduced musculoskeletal disability-related absenteeism and increased productivity. The program reduced medical costs per work-related injury and improved the company's communications and relationship with local physicians.

(Am J Manag Care. 2006;12:SP27-SP32)

Disability-related absences cost major corporations billions of dollars annually. On a typical day, 3% to 6% of any given workforce is likely to be absent as a result of unscheduled issues or disability claims. In 2004, American industries reported approximately 4 257 300 cases of nonfatal injuries and illnesses.1 Of these cases, about 1 259 300 involved lost workdays, 525 390 related to musculoskeletal injuries (eg, sprains, strains, muscle tears), and 282 240 involving back injuries.

The causes, nature, treatment, and prevention of work-related musculoskeletal injuries were investigated in a North American facility with an unusually large number of musculoskeletal disability claims, lost workdays, and surgical referrals. Based on its findings, the company developed a 3-stage communication and educational intervention targeted at community physicians and employees. The program aimed to improve care received by injured employees and to reduce disability-related absenteeism, and was implemented in three 1- year stages. In this article, we describe the changes in related clinical and financial outcomes.



International Truck and Engine Corporation (referred to hereafter as International) is the nation's largest manufacturer of medium-and heavy-duty trucks, school buses, and diesel engines, with facilities in more than 40 major locations. The company employs mostly blue-collar, hourly employees involved in manufacturing operations. International provides free outpatient medical services and support for employees through plant staff. In addition to traditional corporate managers, department and plant staff includes physicians, physical therapists, nurses, and case managers.

Situation Analysis

In late 2001, approximately 25% (≥200) of International's musculoskeletal disability claims, accounting for 65% of total workers' compensation costs company-wide, were coming from the Springfield, Ohio, manufacturing facility. At that time, Ohio state workers' compensation laws allowed employees to seek care at International or select their own treating physicians.

Workers' compensation records revealed that International's Springfield employees with musculoskeletal injuries were not always adequately diagnosed or treated by local primary care physicians (as determined by local orthopedic specialists). Although some employees were unnecessarily referred to orthopedic specialists, others were not referred when appropriate. Additionally, physicians frequently prescribed sedating, controlled-substance pain relievers (eg, opioids), which prevented a safe return to work and often kept employees from returning when their level of disability would have allowed a return to light duty. Company resources, including onsite physicians and physical therapists, were not being sufficiently utilized at the Springfield facility to maximize outcomes.

The literature on musculoskeletal disability management programs indicated that the incidence of workers' compensation claims often leveled off after implementation of a risk screening program that included employee education about work-related musculoskeletal pain.2 Furthermore, clinical practice guidelines for musculoskeletal injuries have been successfully applied in the workers' compensation setting.3 Thus, it was hypothesized that physician education and use of established guidelines, along with improved communications with employees, might help reduce workers' disability costs and improve the care of injured employees at the Springfield site.


In 2002, the company developed the International Musculoskeletal Disability Management (IMDM) program, administered by its Medical Services Department located within the Springfield facility. Baseline data were obtained from workers' compensation records from the first quarter of 2000 through the fourth quarter of 2001. The IMDM program was implemented in 3 stages (Figure) and comprised the following:

The Employee Status/Return to Work Report. This form (the ESRW Report) was given to all employees filing a claim for a musculoskeletal disability, and they, in turn, gave the form to their treating physician. The physician reported on the nature of the disability and current ability to perform body movements, such as bending, twisting, and repetitive hand use; safety-sensitive activities, such as operating motorized equipment; lifting and carrying; and pushing or pulling at specified weight limits, both above and below shoulder level. A new form was completed for each visit and returned to the Medical Services Department.

Evidence-based Medicine Diagnostic Training Seminars. The American Academy of Orthopedic Surgeons (AAOS) clinical guidelines4 were selected and used as the basis for more than a dozen diagnostic training seminars presented by orthopedic specialists to local primary care physicians who currently or recently treated International employees. The seminars were funded by the company and a corporate sponsor.

Job Descriptions. Treating physicians were given the employee's job description, which helped them to assess conditions wherein the employee could return to work, either on a light-duty or unrestricted basis.

Clinical Practice Guidelines. During stages 2 and 3, the AAOS practice guidelines specific to an employee's injury were given to treating physicians.

Awareness of Onsite Capabilities. Physicians were informed about International's onsite physical therapy capabilities so that they might allow injured employees to return to work earlier, knowing they would be appropriately followed and their therapy sessions could be scheduled to accommodate work shifts.

Letters to Physicians. Local physicians were encouraged to (1) complete the ESRW Report; (2) use the AAOS clinical practice guidelines; (3) use the company's onsite physical therapy services for employees with musculoskeletal conditions; and (4) prescribe appropriate medications to safeguard employees, particularly over-the-counter pain relievers, nonsteroidal anti-inflammatory drugs, or the cyclooxygenase-2 (COX-2) inhibitor celecoxib.

Determining Outcomes Related to Study Interventions

Four primary clinical end points were examined. The mean number of scheduled full-time-equivalent (FTE) employees was determined by dividing 37.5 hours per week into the total number of hours worked. The number of work-related injuries was taken from the monthly work loss injury report, and mean injury rate was determined by dividing the total number of injuries by the average number of employees during the stage. The number of days lost per work-related injury was computed by dividing the number of injuries into the total number of injury-related lost workdays. Finally, the number of days lost per scheduled FTE employee was computed as the number of lost workdays divided by the total number of scheduled FTE employees.

Four secondary-cost end points were examined. The average indemnity paid per FTE employee was computed as total facility indemnity costs divided by the total number of FTE employees. The average indemnity paid per work-related injury was computed as the total work-related indemnity cost divided by the total number of injuries. The average medical cost paid per FTE employee was calculated by dividing the total medical costs by the total number of FTE employees. The average medical cost per work-related injury (annually) was computed as total medical costs divided by the number of injuries.

Intracompany Communications

Periodic updates were communicated to the plant management in Springfield and to senior company management. These updates made management aware of the need for continued adherence to the study interventions.

Statistical Methods

Average values of the clinical and financial outcome measures were compared before and after the program. Outcomes are reported as rates, so the change in total FTE employees does not affect the results, although the number of claims dropped in proportion to the decrease in FTE employees.


In 2001, the Springfield facility employed 3417 persons. The number of FTE employees at the facility decreased between 2001 and 2005 as a result of merging some operations into other locations and because a large number of employees retired. The number of employees at the study's end was 1366. The mean age of employees at the Springfield facility was 52.6 years, and mean tenure with the company was 23.2 years. Eighty-two percent of the employees at the facility were men.

Large reductions were observed in work-related injuries (75%), days lost per injury (21%), and days lost per FTE employee (50%). Overall productivity improved by an average of 12.5 days per injured employee after the program was implemented. The mean number of days lost per work-related injury decreased from 35.1 days to 27.6 days, or an improvement of 7.5 days per injury (Table 1). Furthermore, the number of light-duty days increased per work-related injury, from 6.1 to 11.1, and use of the company's onsite physical therapy facilities increased by more than 50%.

Both mean indemnity and medical costs decreased per injured employee (Table 2). The mean annual indemnity paid per work-related injury decreased by $4834 (from $9327 to $4493) and the mean annual medical costs paid per work-related injury decreased by $2169 (from $4848 to $2679). The greatest change from baseline was observed in the mean annual indemnity paid per FTE employee at the facility. Over the 3 stages of the study, this amount decreased from $590 to $178 per FTE employee.

The most commonly occurring musculoskeletal injuries at the Springfield facility both before and after the program began were to the shoulder, wrist, hand, and lower back (Table 3). After taking into account the reduction in the number of employees at the Springfield facility compared with baseline, the overall incidence of musculoskeletal injuries declined from baseline to end of study by as much as 50%. The greatest reduction occurred in the number of back injuries reported per year.


In the IMDM program, International identified shortcomings in its musculoskeletal disability management procedures and implemented solutions that were both clinically and financially effective. Although International decided to enact these procedures in 3 stages, a company wanting to duplicate this program could implement all 3 stages simultaneously or at an accelerated rate compared with this program.

In the Springfield facility, 50.9 hours go into building 1 truck. The IMDM program increased productivity by a mean of 12.5 days per injury. Based on a 37.5-hour workweek, multiplying this number by 7.5 hours per day and by the 54 employees injured during stage 3 reveals a gain of 5062 man-hours, which translates into 99 more trucks built per year. Also, given that replacement employees cost between $24.18 and $45.30 per hour, a gain of 5062 man-hours saves between $122 399 and $229 309 annually.

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