Editor's note: The following is an abridged version of a panel presentation titled "Risk Managers on Effective Claims Management Strategies." The panelists spoke in April, at the annual meeting of the Risk and Insurance Management Society Inc. Panelists included Ann Schnure, claims director for general liability, auto and workers' compensation for Federated Department Stores; Paul Przysiecki, director of risk management for ADP TotalSource; and Bob Steggert, vice president of casualty claims for Marriott International. Randy Wheeler, founder and CEO of Valley Oak Systems, a claims management software vendor, moderated the panel. Questions eliciting responses from the panelists came from the audience at the end of the session.
How did you go about selecting the right business partners whether it was a TPA, system vendor, or another partner in the process?
Bob: We've got a strong group of very tenured professionals both on the claims and nursing side. Anytime we make a major decision like that we put together an internal user group to study it, and in the case of a system, they literally took a year to look at every major provider out there, and they didn't just take the marketing person's word for it.
They went out and drove every single product they looked at and tested it, spoke to clients and the like. Ultimately choosing most of our partners goes that way, it's quality focused and outcome oriented.
In terms of our organization, something that we look for in a vendor relationship is somebody who is flexible, who can customize their program to fit our needs, someone who is a forward thinker like our organization and is really going to help us stay competitive in the marketplace.
Ann: Like Bob did, getting past the marketing demo and making sure what you're going to get, and it works for you. There are a lot of products out there, but we need to actually look at them and look at what you're trying to achieve, and make sure people who are going to use it are resources in selecting the system.
Clarify what P2P is and how it differs from standard bill review?
Bob: P2P is not a bill-review vendor. It's a company that specializes in the transmission electronically of medical bills and medical reports. Their business model is to sign up providers to go through their transaction hub, which scrubs the documents to make sure they're complete and thorough.
These electronic bills then come into my system. It then goes electronically to our bill-review company. That comes back electronically with an explanation of benefits, which prints on our check stub, and that document then is part of the electronic claims file, as an electronic document.
So you no longer have to open a piece of mail, or input anything in respect to Dr. Smith's visit and the like. It's totally paperless and seamless, from receipt to inputting in the system to check generation and to payment.
The one thing we're not doing yet is electronic payment, but that's the next step. We want to eliminate the checks so we can basically pay our providers electronically in real time.
How integrated is your claims hub with your HR and benefits system?
We actually do about 50 percent of our company's nonoccupational disability in our system, so it's totally integrated. We do the leave letters, we do the state disability. For example, in California, we're a wraparound. We do all those notices from the system. It is integrated.
We send the disability people for the states we don't do, and report weekly every time we make comp payments, so there's a wraparound of it. For about 50 percent of the states, we do the leave tracking and the leave administration, which documents in our PeopleSoft payroll system, and tracks their 12 weeks of FMLA, especially if it's nonrecurrent, which is hard sometimes.
Have any of you interfaced directly with the medical clinics?
I'll address that. We have a number of providers under contract in managed-care arrangements, so that's the best example. We partner with them. They communicate with us electronically where possible.
We monitor that, the activity through our nursing and claims staff, and medical consultants and medical director, so any red flags for a treatment that's outside of either ACOEM guidelines or control utilization guidelines, it is reviewed for concurrence both for routine treatments as well as for any surgery or hospitalization.
Ninety-five percent of the time we concur with it. When we don't, as you know, some states require a physician peer review, and we use either our in-house medical director or vendors to provide that service to us.
If the information is out there, how is it secured and kept private?
In terms of privacy, as you probably know, workers' comp is exempt from HIPAA requirements, but that's a battle sometimes to convince the providers of that. So we'll use HIPAA-compliant releases where necessary. But we work to educate them to make certain the information is timely and complete.
Internally, I make my staff sign annual confidentiality statements as part of their personnel file. They know that any improper discussion or release of a private nature outside of the work setting is grounds for termination, so if they're treating someone who has a broken leg, but is also HIV positive, they know they can be terminated for any breach of confidentiality even outside of HIPAA.
How is your "transfer of care" into a Medical Provider Network working for existing cases?
Bob: I haven't studied it. There are provisions that do that. There are a couple of tricky situations. Frankly, we don't know how the trial bar is going to use that. Off the top of my head, I think one of them is that you can't transfer if they're going to conclude treatment within 30 days. But for a lot of long-tail cases, that's obviously a ridiculous argument--they've been out treating for years.
So we anticipate blending all of them in as quickly as possible. We also anticipate some challenges and some legal battles case by case. I'm sure it'll be played out pretty heavily, but our plan is to take them in aggressively.
We're doing the same thing. We didn't create our own MPN. Our vendor that we're using for an MPN is going to come in, and we're going to go through each case individually on the transfer of care because we believe that it's going to be litigated. If you read the guidelines, it's kind of vague in what a "chronic condition" is.
The only thing that's really clear is treating within 30 days, surgery and things like that. So I think you're going to have to be very careful because the applicant attorneys are going to be looking for something to litigate because we've cut into their bread and butter.
How much of the operations are outside the United States? Or is there work of integration of the stakeholders outside the United States?
We're a global company. We operate in 67 countries. We get involved in workers' comp cases as necessary with expatriates or foreign nationals coming into the United States, and vice versa, our people will travel overseas. We will take jurisdiction over any one of our associates who is a U.S citizen and is injured overseas. We'll take it in their home-state jurisdiction, or we'll take it in Washington, D.C. So that is done throughout our organization.
As far as liability cases, we've got "Dollar One Insurance" outside of the United States, and we don't get involved in that. Unless it happens to be a difference in condition, lack of coverage for the foreign country, and they bring suit in federal court of the United States, then our "Dollar One" reverts to it, and we handle those cases in the states.
How are you implementing the MPN and capturing all of the designations of the MPN?
We're actually going to capture that they predesignate in our payroll system, which is going to feed into our FROI system, which we built, which will then feed into our claims software. We are actually putting the predesignation form online, which will save into a file so we don't have to go to the HR files to get it, because that's a problem--otherwise no one will be able to see it.
We've made a business decision at this point not to prequalify predesignation until they have a claim because it's a lot of work to do that. So we're not prequalifying them ahead of when they have a claim. The criteria they have to meet in order to be a prequalified doctor, we're not doing that. So we're doing it that way, and that's an issue because how do you know, and how do you designate which claim is an MPN claim and which isn't, which fits that category? Those are all current issues right now. Our MPN just went live April 1.
September 1, 2005
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