Workers Compensation Managed Care

1. Workers Compensation Managed Care By: Laura Deterding, ACAS, MAAA Midwest Employers Casualty Company

2. Ratemaking Implications of Managed Health Care on Workers Compensation: Components and their Ratemaking Implications

3. The goal of Workers Compensation Managed Care is to integrate cost containment with optimal treatment to facilitate expeditious re-entry into the workforce.

4. Employer Medical Providers Minimal cost to Utilization Review Specialist Employer Case Managers Workers Compensation Managed Care “Participants” TPA/ Claims Adjuster Vocational Rehabilitation Specialist Injured Employee

5. Workers CompensationManaged Care • Third Party Administrator (TPA)/Claims Adjuster • Role: • Investigate compensability of the claim. • Identify and assign appropriate case managers and vocational rehabilitation specialists. • Set objectives and measure the results. • Secure IME/Second Opinions.

6. Workers CompensationManaged Care • Third Party Administrator (TPA)/Claims Adjuster (Continued) • Role: (Continued) • Evaluate vocational rehabilitation involvement and return to work possibilities. • Settle the claim. • Goal: • Proper claims handling is essential to cost containment and indemnity mitigation.

7. Workers CompensationManaged Care • Case Management • Definition:Case management is necessary to insure that proper medical protocols are applied for a specified injury type. The case manager is a registered nurse with professionally recognized designations and experience with industrial disability cases.

8. Workers CompensationManaged Care • Case Management (Continued) • Role: • Develop treatment plans and communicate those plans to: • Treating Physician • Injured Employee • Employer • TPA/Claims Adjuster.

9. Workers CompensationManaged Care • Case Management (Continued) • Role: (Continued) • Steer injured workers to industrial physicians/PPO/HMO networks • Industrial physicians have an in-depth understanding of the industrial disability process and the employer’s needs. They serve as “gatekeepers” directing the initial treatment avenues • Work with employer and vocational rehabilitation specialist regarding light duty and return to work possibilities.

10. Workers CompensationManaged Care • Case Management (Continued) • Role (Continued) • Attend medical staffings and provide input regarding appropriate treatment protocols. • Goal: • Effective case management results in medical cost containment and reduced indemnity costs.

11. Hospitals • Physicians • Prescription Services • Physical Therapy Centers • Other Medical Services Workers CompensationManaged Care • Medical Provider System • PPO • PPO networks involve pre-negotiated discounts for the employer by use of selected providers. Networks may include: Caution: There is a potential for utilization abuse. Should evaluate treatment frequency.

12. Workers CompensationManaged Care • Medical Provider System (Continued) • HMO • HMO providers are paid a flat fee for each covered employee. Providers involved in an HMO are employees of that organization. Caution: There is an incentive for the provider to reduce the treatment frequency.

13. Prescriptions • Other medical services • Physician charges • Hospital Charges Workers CompensationManaged Care • Medical Provider System (Continued) • Fee Schedules • This involves a legislated schedule of fees payable by specified CPT codes. Fee schedules establish a schedule of maximum charges applicable to: Caution: Must verify adherence to fee schedules through in-house review or through an independent vendor who shares in the percentage of savings.

14. Workers CompensationManaged Care • Medical Provider System (Continued) • Goal: • An effective medical provider system results in medical cost containment. Indemnity losses may be indirectly affected.

15. Frequency • Duration • Medical reasonableness/necessity • Appropriateness Workers CompensationManaged Care • Utilization ReviewDefinition:Utilization review is a system to manage, assess, and review the injured employee care. • Role: • Care is evaluated based upon the following criteria:

16. Workers CompensationManaged Care • Utilization Review (Continued) • Goal: • Effective utilization review results in medical cost containment. Indemnity losses may be indirectly affected.

17. Workers CompensationManaged Care • Vocational Rehabilitation Definition: Vocational rehabilitation is a systematic tool utilized to facilitate re-entry into the workforce. Parameters for vocational rehabilitation are established by the TPA/claims adjuster include setting objectives and measuring outcomes within established time frames.

18. Workers CompensationManaged Care • Vocational Rehabilitation (Continued) • Role: • Provides vocational assessments for feasibility of return to work. • Helps employer formulate light duty positions, both short and long term. • Perform labor market surveys and job searches. • Goal: • Effective vocational rehabilitation results in reduced indemnity payments.

19. Safety programs • Wellness programs • Procedures for reporting job-related injuries • Workers Compensation system • Light duty/Return to work programs Workers CompensationManaged Care • Employer One of the fundamental principles of managed care involves employer participation. • Role: • Provide educational materials and training to personnel regarding:

20. Workers CompensationManaged Care • Employer (Continued) • Role: (Continued) • Formalize light duty programs. • Communicate frequently with injured employees. • Involved in the selection of industrial/panel physicians.

21. Workers CompensationManaged Care • Employer (Continued) • Goal: • The employer involvement results in both medical cost containment and reduced indemnity losses.

22. Workers CompensationManaged Care The End