Self-insured employers face a difficult balancing act when it comes to providing benefits for employees. On the one side, a self-insured employer may feel a close connection to its workers and want to provide the best possible care for them.
"Self-insured employers tend to act more maternal toward their employees. They are very concerned about them and typically have a closer connection to the employees, as opposed to the big insurance company that doesn't have day-to-day contact with these same people," says Gary Wolfe, an independent case manager with Continuous Learning, based in Salinas, Calif.
On the other side, the self-insured employer--like virtually every other company--feels the pressure to control costs and improve productivity.
The key to balancing these concerns is to take an outcomes-based approach in the management and evaluation of programs, including workers' compensation and group health.
By looking at specific indicators--such as clinical or functional measures--self-insured employers can determine how successfully their benefit plans are meeting the needs of the employees and their dependents.
Moreover, by identifying, measuring and tracking outcomes, companies have a better grasp of what they're paying for in terms of benefits--and the return they're reaping on that investment.
Case management plays a central role in achieving positive outcomes in worker's compensation and group health. Case managers identify appropriate providers and facilities across the continuum of health care and human services, while ensuring that available resources are timely, cost-effective and efficient.
"Employers are in the driver's seat," says Deborah Smith, executive vice president of AMS Inc., in Altadena, Calif."They have the opportunity to make tremendous progress by managing outcomes. The kinds of outcomes that employers should be looking for are, ultimately, all related to worker productivity. Productivity variables should be important to employers in managing both workers' compensation and health benefits. Case management provides an opportunity for employers to get optimal results and to get them quantified."
Outcomes are important to the self-insured employer, including those that use a third-party administrator, those that self-administer their benefits, and those that utilize an administrative service organization.
Three outcomes matter most, regardless of the method self-insured employers use.
-Financial outcomes: How much money is being saved?
-Patient or client satisfaction outcomes: What is the experience of the individuals receiving services?
-Clinical or functional outcomes: How have the critical clinical indicators improved? Has the patient increased his or her functionality in life, such as return to work or school?
BEWARE SLIPPERY METRICS
Financial outcomes may be the first area examined in both workers' compensation and group health.
Historically what self-insured employers want to see are the savings. On the health side, financial outcomes can improve through rate negotiations with providers and vendors of services, such as durable medical equipment suppliers. Savings may also be realized by directing patients to preferred providers or centers which have pre-established reimbursement rates which reduce the cost to the plan. In addition, shrewd case management can eliminate duplication of services and avoid unnecessary services through timely coordination and communication. That also saves money.
When tracking financial outcomes, it's imperative to determine how they are calculated. While some case management firms may discuss "return on investment," there is little consistency in the field as to how it's calculated--and even if it's calculated at all, according to Smith.
"Not everybody is calculating ROI and there is significant variability in how ROI is calculated," she adds."At the very least, what an employer needs to be doing is asking the case management organization: Do they calculate ROI? What is included and what is excluded? In this way, employers can make a fair and competitive choice about the services they are purchasing or providing."
To gauge employee/patient satisfaction with case management and other services, standardized tools may be used. For example, satisfaction surveys enable patients/clients to rate their experiences. Or, there may be a grievance mechanism for those who are unhappy with case management or other aspects of the services to provide that feedback.
"Employers are concerned that their employees have a good experience--even in cases when the individual cannot be returned to an optimal state of health. They want to know the quality of that process," says Wolfe.
He recalls one case in which he was contacted by a bank in Long Island with which he had recently worked, regarding a long-time employee who had a terminal illness.
"The human resources manager told me that the surviving spouse had just contacted her to say how happy she was with the treatment process, even though her husband had died. She found the whole process to be so supportive," Wolfe added.
PINNING DOWN OUTCOMES
Among case management providers there are no standardized means to measure clinical or functional outcomes. Typically, it depends upon the venue of service. For example, with workers' compensation cases the measures are reflected by the success of rehabilitation, and whether the worker was deemed employable or able to return to work.
Or, it may be predicated on achieving maximum medical improvement. In the terms of group health, depending upon the person's condition, measures may gauge how well the person's condition was stabilized or whether the individual returned to his or her previous state of health. There may even be specific clinical indicators for certain diseases that are tracked to determine how well patients are complying with evidence-based clinical guidelines.
"For clinical outcomes, the key elements are the parameters. Is it satisfaction? Is it quality of life?Improved health status? The employer needs to find this out upfront," Wolfe says.
While employers may emphasize one particular outcome over another, a balanced approach would be to track to some degree all three targeted areas.
"If I were to design the evaluation of case management from the employer's point of view, I would include ROI and how it's calculated," Smith says. "It would include some hard dollar savings and some soft savings about productivity. If someone gets injured at work, I would look at whether and when that person came back to work and whether they can do their regular job."
Tracking and carefully evaluating outcomes will allow self-insured employers to better evaluate case management services. They can determine if their expectations are being met, what benefits are realized, and what obstacles or unforeseen events arise. The outcomes can then be used to target areas for improvement.
Throughout the process, case management, which advocates for the patient and quality of care while promoting cost-effective treatment resources, is an important strategy to achieve those desired outcomes.
MICHAEL GARRETT is a commissioner for the Commission for Case Manager Certification, a certifying body for case management professionals. He is also vice president for Qualis Health, a nonprofit healthcare quality improvement firm in Seattle.
April 1, 2005
Copyright 2005© LRP Publications