It is time to get angry. I plead with you all to recognize the king’s new clothes as he stands indignantly naked between the 300-pound gorilla and the elephant in this room called Workers’ Compensation. I am hereby calling out an industry that has turned “Managed Care” into “Manipulated Cost” with a shameful lack of transparency and the consequential mass of so many churning Workers’ Compensation claims.
Decades ago the cottage industry of bill-review provided a legitimate and needed service directly between provider and payer. Fast forward to the hijacked and evolved scheme now run by the face of networks and other purchasing-consortiums partnered with conspiring insurers and TPA’s. Employers may assume they only get above-board charges for bill review and/or network fees. They may be unaware of more insidious shadowy internal deals where medical goods and services are marked up by intermediary agents with undisclosed sharing of “profits” among the perpetrators.
Sadly, there is little in the way of outrage from the employer marketplace. Perhaps the amounts seem negligible while the methods seem to be an acceptable norm for doing business. Risk Managers have so much else to think about and prioritize in their overall programs. Maybe the status-quo props up an accepted notion that “Managed Care” is essential in its present form and no one in their right mind would question it.
I believe the employer-buyer holds a false sense of security which we need to get beyond. The drip-drip-drip of money siphoned from actual employee care needs to finally strike a collective nerve so real change can happen. To that end, I want to list some considerations that will hopefully spark change-focused outrage.
Quick Tip: Managed Care Food For Thought, Indigestion Guaranteed:
Cognitive Dissonance: Claim providers justify bill-review fee schemes based on the notion that there are no controls from provider-sources… but wait a minute… they also and at the same time take network fees because they apparently can control bills from provider sources! Anyone feel mildly conflicted trying to reconcile this logic? How can both facts exist?
Deliberate Mystery: Bill review as founded decades ago should no longer be necessary. Today’s technology obviates the premise that all WC bills need to be hand-checked against a fee schedule or that licenses for CD-ROMs holding schedules or “reasonable and customary” data are a valuable commodity. When it comes to group health, providers make it their business to know what deductibles and reimbursements apply while you stand at the window. Why is WC a deliberate mystery?
Technology Hypocrisy: The WC claims industry purports to have data and IT capability that can predict and fast-track claims allowing ever-higher (arguably untenable) adjuster caseloads, yet when it comes to monitoring fees pretends we are still in the1990’s. I submit that today’s technology can lock providers into correct billing. Aggregate provider monitoring/auditing by the adjusting entity can support accuracy. High automation and negligible cost should make fee oversight an included aspect of claim service, with network affiliation requiring providers to contribute to the technology. As our national provider base moves into more hospital-centered conglomerates there are far more IT resources available on the provider-end.
Core Responsibility: TPA’s and insurers are paid to adjust benefits per state statutes. Keeping that in mind, charging a percentage of savings for medical care in a fee schedule state is as ridiculous as would be charging a percentage of “savings” for reducing an average-weekly-wage to the statutory comp-rate. What is the difference when it comes to core claim adjusting obligations?
No Repeat Value Added: We can agree that complicated in-patient bills are worthy of review and requisite fees. Opposite that, claims routinely see recurring bills from the same providers on the same file. After the initial adjustment, why should claim payers charge a fee for adjusting the exact same bill repetitive times? Seriously… there is no value added in charging for a task already performed. Here is an exercise: Look at your claim payment register to see the same $1.15 bill review fee and $5.32 network fee charged on the same $48 PT bill over and over and over… Maddening, isn’t it?
How Would You Feel?: Let’s make it personal. What if your homeowners or auto insurer mandated your use of a repair-provider-network? Your damaged car gets fixed and you are presented with a bill marked up by the network not knowing what the actual body shop charged. You pay your deductible, leaving “profit” for your insurer and network to split… Hmm…
Low Quality Reality: Network discounts have come to roost leaving provider frustration high and quality of care low. Much like the end-game of any pyramid scheme, the early money has been taken and little value is left for those invested; specifically, claimants, employers and the doctors/providers themselves. I submit that higher quality deserves higher fees.
New Network Charge: Efforts to define, seek and sustain quality should be at the forefront of network effort. Can you imagine providers competing based on quality to join exclusive well-paying networks? Astute unbundled and self-administered employers who seek out medical quality often pay more with confidence and get better results. Today’s bundled programs beget providers willing to work cheap and/or approach profit on a volume-of-treatment basis. More visits means more weeks/months/years open equals more money for the entities otherwise trusted to resolve claims. Isn’t this reality the opposite of what should be “Managed Care”?
Employers… Get angry: Start asking questions and making demands. Let’s start with disclosure of end-provider fees. Ask your legislators to crack this issue open and make corrections accordingly. I call upon some major broker to take the lead and create a “Managed Care Bill Of Rights”… wouldn’t that be a great distinction?
Bottom line: The insurance/claims/managed care industry can not beg the trust of those served while skimming treatment dollars. Fix it.