Whether unbundling workers’ compensation managed care services from third-party administration contracts really benefits employers continues to stir debate among the strategy’s advocates and detractors. I suspect that whether an employer that unbundles sees improved claims outcomes and cost savings, or better service depends on their resources and commitment to managing multiple vendors.
However, fewer risk managers and workers’ compensation managers may be considering unbundling today, compared to a few years ago, said Charles F. Martin, managing director, casualty operations consulting leader at Marsh USA Inc.
“My sense is that there is definitely less of an inclination to unbundle,” Martin said, noting that he has clients that unbundle and he believes some companies benefit from doing so.
But proponents haven’t established that unbundling guarantees better claims outcomes, Martin said. Meanwhile, TPAs and insurers improved their delivery of managed care offerings, helping to sway employer decision-making.
Some employers using an unbundled approach for years are being nudged back to bundling, thanks to consolidation among managed care service providers. I can’t say, however, whether there’s a trend there.
One workers’ comp manager I spoke with reaffirmed her commitment to keep unbundling case management, utilization review, and bill review from her TPA services. She said doing so allows customization of those products to fit her needs and affords greater quality control.
Unbundling remains an important option for employers with the sophistication to manage it. Recently, though, Srivatsan Sridharan and Niel Simon at Gallagher Bassett Services Inc. sought me out to pose counter arguments to unbundling.
Risk managers with shrinking internal staff support will be challenged to oversee multiple service providers and replicate the level of quality control that a TPA team can provide, they said.
“There are too many moving parts and making sure that quality and outcomes are not compromised in any of these parts requires significant investment in time, people and resources,” Sridharan said.
Employers can make mistakes when there is a limited amount of claims data to analyze before deciding which service providers to contract with, they said. In contrast, GB makes decisions based on its analysis of $4 billion in claims data.
Sridharan and Simon also posed other arguments. But several speakers in a recent Risk & Insurance® webinar titled “Succeeding with an Unbundled Claims Management Approach” made strong arguments for their opposing view as well.
For example, Frank Lott, corporate claims director for FirstGroup America, said he unbundles bill review, pharmacy benefit management, field nurse case management, and physical therapy.
Doing so for 2.5 years has led to greater transparency in bill review fees, he said. Before he couldn’t understand what he was billed for. He has also experienced reduced costs, improved program control for greater loss cost reductions, and a higher level of service provider expertise.
The debate over bundling versus unbundling doesn’t matter much to some insurers because they don’t allow their customers to unbundle.
But the option should remain available for employers and the debate should continue so they can weigh critical insights on which options may serve them best.
Where’s Your Bottle of Painkillers?
Medical care providers inconsistently prescribe powerful – and highly addictive – narcotic painkillers across the country, according to a recent study by the federal Centers for Disease Control and Prevention (CDC) and data from Liberty Mutual Insurance.
This variation needlessly endangers patients, drives up workers compensation costs and may not provide a healing benefit to injured workers.
This is largely a problem that shouldn’t exist, since the American College of Occupational and Environmental Medicine (ACOEM) “Guidelines for the Chronic Use of Opioids” provide clear best medical practices for prescribing powerful narcotic painkillers — and advise that they be used only for select patients.
And yet the recent CDC study found tremendous variability in the rates of narcotic prescriptions between states.
For example, in 2012, health care providers in Tennessee wrote 143 pain killer prescriptions per 100 people, while doctors in California issued 57 prescriptions per 100 people.
Shockingly, health care providers across the U.S. wrote 259 million prescriptions for painkillers in 2012, enough for every adult American to have a bottle, according to the study.
A Liberty Mutual study published in 2009 found similar interstate variation in opioid prescriptions for acute work-related lower back pain. In fact, almost eight times as many opioid prescriptions were written in South Carolina for acute lower back pain than in Massachusetts during the study’s time frame.
The problem is clear. So is the solution.
Here are four steps every risk manager should take to help protect injured employees and the bottom line:
• Get informed — Understand if the states where your company operates have high rates of opioid prescribing, and to what extent the workers compensation systems in those states require treating physicians follow the ACOEM guidelines.
Providers treating injured workers in some states are mandated to follow these guidelines, while they are mere suggestions in other states.
• Get involved — Help your regulators and legislators understand the problems associated with narcotic over prescription, for both individuals and employers.
Work with them to appreciate the value of evidence-based medicine, such as the ACOEM guidelines.
• Use the right medical care provider — Having the injured worker treated by a provider experienced in occupational injuries will usually help the worker recover sooner and make the use of narcotics much less likely.
Even in states where employers cannot direct the care of injured workers, they can help employees understand the potential dangers of powerful narcotic pain killers.
• Spot problems early — Closely monitor claims. Use specialized resources to quickly identify the inappropriate use of narcotics and the early warning signs of potential abuse, such as use of multiple pharmacies or physicians, depression and addictive behaviors.
While not everyone has a bottle of painkillers, some have several. And it may be costing those individuals — and their employers — dearly. Get involved to help end this tremendous human and financial waste.
The Re-Invention of American Healthcare
Consolidation among healthcare providers continues at a torrid pace.
A multitude of factors are driving this consolidation, including the Affordable Care Act compliance, growing costs and the ever-greater complexity of health insurance reimbursements. After several years of purchasing individual practices and regional hospital systems, the emergence of the mega-hospital system is now clear.
“Every month, one of our clients is either being bought or buying someone — and the M&A activity shows no signs of slowing down,” said Brenda Osborne, executive vice president at Lexington Insurance Co.
This dramatic change in the landscape of healthcare providers is soon to be matched by equally significant changes in patient behavior. Motivated by growing out-of-pocket costs and empowered with new sources of information, the emergence of a “healthcare consumer” is on the horizon.
Price, service, reputation and, ultimately, value are soon to be important factors for patients making healthcare decisions.
Such significant changes bring with them new and challenging risks.
Although physicians traditionally started their own practices or joined medical groups, the current climate is quite the opposite. Doctors are now seeking out employment by health systems. Wages are guaranteed, hours are more stable, vacations are easier to take, and the burdens of running a business are gone.
“It’s a lot more of a desirable lifestyle, particularly for the younger generation,” said Osborne.
Brenda Osborne discusses the changing healthcare environment and the risks and opportunities to come.
Given the strategic importance of successfully integrating acquired practices into a larger healthcare system, hospitals are rightfully focused on how best to keep doctors happy, motivated and focused on patient safety.
A key issue that many hospitals struggle with is how to provide effective liability insurance for their doctors. Physicians who previously owned their practice are accustomed to a certain type of coverage and they expect that coverage to continue.
Even when operators find comparable liability insurance solutions for their doctors, getting buy-in from their staff is often an additional hurdle to overcome.
“Physicians listen to two things — physician leaders and data,” said Osborne. “That’s why Lexington provides assessments that utilize deep data analysis, combined with providing insights from leading doctors to help explain trends and best practices.
“In addition, utilizing benchmarks against peers helps to identify gaps in best practices. It’s a very powerful approach that speaks to doctors in a way that will help them improve their risk.”
Focusing on the “continuum of care”
There’s been a fundamental shift in how healthcare providers care for patients: Treatment is becoming more focused on a patient’s overall health status and related needs.
A cancer patient, for example, should have doctors in a number of specialties communicating and working together toward a positive patient outcome. But that means a change in thinking: Physicians need to work collaboratively with one another — not easy for individuals or groups that are used to being independent. Healthcare is a team sport.
“If there isn’t strong communication, strong leadership, and the recognition of proper treatment procedures between physicians, healthcare providers can increase the risk of error,” said Osborne. “The provider has got to treat the whole patient rather than each individual condition.”
That coordination must extend from inpatient to outpatient, especially since the ACA has led to a rapid increase in patients being treated at outpatient clinics, or via home health or telehealth to reduce the cost of inpatient care
“Home health is going be a growing area in the future,” Osborne continued. “Telehealth will become an effective and efficient way of managing and treating patients in their home. A patient might have a nurse come in and help the healthcare provider communicate with a physician through an iPad or computer. The nurse can also convey assessment findings to the physician.”
Metrics matter more than ever
Patients have not always thought of themselves as healthcare consumers, but that’s changing dramatically as they pay more out of pocket for their own healthcare. At the same time, there’s an increase in metrics and data available to the public — and healthcare consumers are drawing upon those metrics more and more when making choices that affect their health.
“Consumers are going to start measuring physicians against physicians, healthcare systems against healthcare systems. That competition will force everyone to improve the quality of care.”
– Brenda Osborne, Executive Vice President, Lexington Insurance
Think about all the research a consumer does before buying a car. Which dealership has the best price? Who provides the best service? Who’s offering the best financing deal?
“Do patients do that with physicians? No,” said Osborne. “Patients choose physicians through referrals from friends or health plans with minimal information. Patients may be putting their lives in the physicians’ hands and not know their track record.
That’s all going to change as patients’ use of data becomes more widespread. There are many web based resources to find information on physicians.
“Consumers are going to start measuring physicians against physicians, healthcare systems against healthcare systems,” said Osborne. “That competition will force everyone to improve the quality of care.”
Effective solutions are driven by expertise and vision
The rapidly evolving healthcare space requires all healthcare providers to find ways to cut costs and focus on patient safety. Lexington Insurance, long known as the leading innovative and nimble specialty insurer, is at the forefront in providing clients cutting-edge tools to help reduce costs and healthcare exposures.
These tools include:
- Office Practice Risk Assessment: To support clients as they acquire physician practices, Lexington developed an office practice assessment tool which provides a broad, comprehensive evaluation of operational practices that may impact risk. The resulting report, complete with charts, graphs and insights, includes recommendations that can help physicians reduce risk related to such issues as telephone triage, lab results follow-up and medication management. .
- Best Practice Assessments: High risk clinical areas such as emergency departments (ED) and obstetrics (OB) can benefit significantly from external, objective, evidence-based assessments to identify gaps and assure compliance with best practices. In addition to ED and OB, Lexington can provide a BPA for peri-operative care, prevention of healthcare-acquired infections, and nursing homes. All assessments result in a comprehensive report with recommendations for improvement and resources along with consultative assistance and support. .
- Continuing Education: In an effort to improve knowledge, decrease potential risk and support healthcare providers in the use the most current tools and techniques, Lexington provides Continuing Medical Education credits at no cost to hospitals or their physicians.
- Targeting the Healthcare Consumer: With Medicare reimbursement impacted by patient-satisfaction surveys, assuring a positive patient experience is more critical than ever. Lexington helps hospitals understand and improve the patient experience so they can continue to earn the trust of healthcare consumers while preserving their good reputation. .
To learn more about Lexington Insurance’s scope and depth of the patient safety consulting products and services healthcare solutions, interested brokers may visit their website.
This article was produced by the R&I Brand Studio, a unit of the advertising department of Risk & Insurance, in collaboration with Lexington Insurance. The editorial staff of Risk & Insurance had no role in its preparation.