CWCI: Latest network provider study suggests 'continuing maturation'

California workers' comp payers may have shifted their focus to directing injured workers to provider networks from the beginning of their claims, according to a new study. The report shows the trend toward the increasing use of network providers in the workers' comp system is continuing.

The California Workers' Compensation Institute updated previous studies that measure network utilization rates following the initiation of medical provider networks in 2005. Use of MPNs was included in legislation intended to control the cost of workers' comp medical care in California.

Prior to the passage of S. 899, workers' comp claims administrators typically were only allowed to direct an injured workers' care for the first 30 days after the injury. After the implementation of the reforms, claims administrators were given medical control for the life of the claim for employees covered by an MPN.

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The researchers looked at more than 1 million claims with injury dates between 2004 and September 2010. The claims involved more than 15.7 million outpatient, provider-based treatment services in the first year following injury, resulting in nearly $2.2 billion in payments.

The results show in accident year 2009, network providers accounted for three-quarters of all first-year, physician-based outpatient services to injured workers. That compares to 51 percent in AY 2004, just before implementation of the reforms.

Specifically for AY 2009 claims, 81 percent of the services within the first 30 days were from network providers and 71.4 percent were provided for services after 30 days. "These results suggest that when MPNs were initially available, workers' compensation payers may have focused more on exercising their extended medical control, whereas in subsequent years their focus shifted to channeling injured workers to networks from the outset of the claims," the authors wrote.

The report also looked at network utilization rates for:

Evaluation and management. The network utilization rate for first-year evaluation and management services in AY 2004 was 64 percent. After MPNs became operational in 2005, the rate grew. By AY 2009, network providers accounted for nearly 83 percent of injured workers' first-year evaluation and management services.
Surgery. The rate for first-year surgery services grew from almost 55 percent in AY 2004 to more than 74 percent in AY 2009, a relative increase of 33.5 percent. That was mainly driven by the increased use of networks after the first 30 days.
Physical therapy. The network utilization rate initially jumped from 40 percent in AY 2004 to 54 percent in AY 2005. It has since increased slowly but steadily to more than 63 percent by AY 2009.

Read more at the WorkersComp Forum homepage.

December 15, 2011

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