Tag Archives: Medical Provider Networks

Cross-Border Health Care in California Expands

In my earlier posts on cross-border health care, “Cross-border Workers’ Compensation a Reality in California“, “NAFTA, Work Comp and Cross-Border Medical Care: A Legal View“, “NAFTA, Work Comp and Cross-Border Medical Care: A Legal View: Update“, and “Cross-border Health Care and the ACA“, I discussed the way some Mexican workers living in Mexico, but working in the US or traveling between the US and Mexico, have been able to get health care on both sides of the border.

An article in Fierce Healthcare.com last month,  says that Scripps Health will help run a hospital in Tijuana, along with Sistemas Medicos Nacionales S.A. de C.V. (SIMNSA).

SIMNSA is the medical insurer in Mexico that the Insurance Company of the West (ICW) contracted with some time ago to treat Mexican workers of ICW’s US insureds in the San Diego/Imperial Valley area of CA.

According to the article by Ilene MacDonald, the insurer will design, build and operate the facility, and will seek accreditation from the international arm of the Joint Commission, the Joint Commission International (JCI), and will be an affiliate of the Scripps Health Network.

Those who think that cross-border health care, whether general or work comp-related is not going to happen better think again, because it is, and while this is just now involving the areas along the US-Mexico border, with or without that stupid wall some jerk wants to build and have Mexico pay for, medical travel on this continent is moving forward.

The only thing that is not happening yet is travel further down into Mexico and into the other countries in Central and South America. But that will happen, no matter what you or any putz running for president says.


I am willing to work with any broker, carrier, or employer interested in saving money on expensive surgeries, and to provide the best care for their injured workers or their client’s employees.

Ask me any questions you may have on how to save money on expensive surgeries under workers’ comp.

I am also looking for a partner who shares my vision of global health care for injured workers.

I am also willing to work with any health care provider, medical tourism facilitator or facility to help you take advantage of a market segment treating workers injured on the job. Workers’ compensation is going through dramatic changes, and may one day be folded into general health care. Injured workers needing surgery for compensable injuries will need to seek alternatives that provide quality medical care at lower cost to their employers. Caribbean and Latin America region preferred.

Call me for more information, next steps, or connection strategies at (561) 738-0458 or (561) 603-1685, cell. Email me at: richard_krasner@hotmail.com.

Will accept invitations to speak or attend conferences.

Connect with me on LinkedIn, check out my website, FutureComp Consulting, and follow my blog at: richardkrasner.wordpress.com.

Transforming Workers’ Blog is now viewed all over the world in 250 countries and political entities. I have published nearly 300 articles, many of them re-published in newsletters and other blogs.

Share this article, or leave a comment below.

Medical Management Internship Paper, Summer 2011

No doubt, many of my readers have wondered what I learned in my MHA degree program, and why my writing has been of interest to so many of you.

Upon checking my stats for the blog, I noticed that someone had viewed a paper I wrote in the summer of 2011 for my Summer Internship course, as part of my MHA degree program requirements. The school I attended required all students without a health care background to take a one-credit course as an Intern in a health care organization.

The organization I choose was one my school already contracted with, Broadspire. At the end of the course, we were expected to write a paper about our internship for a grade in the course.

The following link will direct the reader to a copy of my paper that I hope the reader will find interesting, and will highlight my skills as a researcher and writer. Speaking engagements as well as research opportunities are most welcome, as are full-time positions and consulting opportunities.

https://www.dropbox.com/s/5573hm8xo074po0/Medical%20Management%20Internship%20Paper.docx?dl=0

As the summer session was very short, only three projects were undertaken, and the last one was truncated due to time constraints and the report presented to Broadspire concentrated on only two states, Florida and California.

Let me know your thoughts.

California Work Comp: What a Mess!

Kevin Tremblay, V.P., National Accounts for SMS National Solutions in Altamonte Springs, Florida, and a connection of mine on LinkedIn, penned the following article about California work comp and liens.

Normally, I shy away from articles involving California work comp, but on one or two occasions have written articles about it that I feel fit the subject of this blog. This article is one of those, but is more about the mismanagement of one state’s work comp system, rather than the state of affairs of the entire system nationwide.

Here is Kevin’s article in full:

California Workers Compensation System – Liens, Waste and Medical Provider Billed Charges

The California workers’ compensation system is unique like no other state in the country. There are two distinct sides of the equation in California workers’ compensation, Applicant and Defense.

Applicant-The party, usually the claimant that opens a case at the local Workers Compensation Appeals Board (WCAB) office by filing an application for adjudication of claim.

Defense-The party, usually the employer or its insurance company opposing the claimant in a dispute over services and benefits.

Lien-A right or claim for payment against a workers’ compensation case. A lien claimant, such as a medical provider, can file a form with the local Workers Compensation Appeals Board to request payments of money owed in a workers’ compensation case.

OMFS-The official medical fee schedule is promulgated by the DWC, Department of workers Compensation administrative director under labor code section 5307.1 and can be found in section 9789.10 of title 8, California code of regulations. It is used for payment of medical services required to treat work related injuries and illnesses. The California Official Medical Fee Schedule is considered prima facie evidence of reasonableness.

A lien claimant has the burden of proving that any amount charged is reasonable, and a lien claimant must prove that there are “extraordinary circumstances” that justify a fee that exceeds the Official Medical Fee Schedule.

According to some recent reports, an expected 500,000 liens will be filed by treating medical providers in the California Workers Compensation system in 2015, costing employers and insurers an estimated $200 million dollars in loss adjustment expenses and delaying claims adjudication.

Some of these liens forces some employers or insurance companies to settle liens they may not be legally obligated to pay simply to settle and close the claim to avoid paying additional disability, administrative and legal costs. Emphasis here on, ‘forces

Some additional statistical findings reported by the DWC are:

  • Medical treatment liens account for more than 60 percent of the liens filed, and 80 percent of the dollars in dispute.
  • $1.5 billion per year is claimed in medical lien disputes after adjusting for amended lien files.
  • One-third of medical liens involve disputes over the application of the Official Medical Fee Schedule.
  • Authorization for treatment was in dispute in seven out of 10 medical liens surveyed.
  • Reasons treatment was not authorized were: 37 percent provider not authorized to treat (mostly out-of-network); 7 percent denied claims; 6 percent medical necessity of treatment rejected by utilization review; 1 percent contested body parts; 20 percent authorization status unknown or not stated.
  • The volume of liens filings is sensitive to procedural changes, such as the adoption or repeal of a $100 filing fee and the adoption of new filing procedures.
  • Up to 30 percent of medical liens are prematurely submitted before the time has elapsed for the claims administrator to pay or object to the provider’s bill.
  • Ten percent of medical liens are submitted on the date the service is provided.
  • Nearly one quarter of medical liens are filed more than two years after the last date of services for which payment is claimed, including 6 percent that are filed five or more years after the last date of services.

The report was based on information provided by the Division of Workers’ Compensation, and was an attempt to characterize the problem so policymakers can propose solutions to the lien problem.

Source: CHSWC/InsuranceJournal.com

The Lien System Game:

Bill ($5,000) – Paid ($1,000)-in accordance with OMFS

Fee to file the lien the claim in court by medical provider $150.00

Lien balance $4000

Demand: $3800

Offer: $2000

Negotiation continues

Collector says $3200 is the bottom line for him

Adjuster forced to pay and settle to avoid additional claim cost agreement at $3200

So while the DWC and legislators continue to sort over of resolve the issues of the lien process, what can adjuster’s implement to mitigate the process and reduce claims costs? The following strategies are a good place to start:

  • How much is the lien?
  • How much is the OMFS or reasonable value of the lien?
  • What are your lien defenses?
    • AOE/COE
    • MPN
    • OMFS or other fee schedules / IBR
    • Reasonableness & Necessity
    • UR / IMR
    • Other technical issues
  • What evidence do you have to support your position? Objection letters? MPN Notices?
  • Did you serve your evidence on the lien claimants and/or your counsel?
  • What are the probable economics of your decision to settle or fight?
  • How much are you willing to pay to settle or resolve the lien?
  • We paid per OMFS & DOS is after 1/1/13
  • You failed to request 2nd review within 90 days (LC 4603.2(e)(2))
  • You failed to request IBR within 30 days from 2nd review (LC 4603.6(a)
  • You are done. The Code says: “the bill shall be deemed satisfied and neither the employer nor the employee shall be liable for any further payments.”
  • Any appearance at the board on your lien will result in a petition for costs & sanctions! [LC 5811 & Valdez decision (en banc) (77 CCC 1113)]

The State of California has taken recent measures with the advent of SB863 and labor codes 9792.5.12 and 4903.1(b) regarding independent bill review process and tighter lien submission rules. California legislators need to continue to act and close the loop holes in existing laws to mitigate and eventually eliminate the magnitude of waste and abuse by certain medical providers that is currently taking place and plaguing the workers’ compensation system.

The lien process is certainly unique to the rest of the country’s state by state workers’ compensation system. So what is it? Unethical gaming of the system and adding tremendous unnecessary costs and clogging the California courts and workers’ compensation system, no question. Anything more, you decide…..

Independent Medical Review Upheld as Constitutional

As I mentioned this morning to a good friend, I normally shy away from writing about California work comp issues, but the following article by Stephanie Goldberg, is indicative of how the legal system has been corrupted to the extent that benefits are denied to injured workers when it is proved they are necessary to deal with their injuries, especially those that leave the worker unable to be gainfully employed.

In other words, the courts have helped the employers screw the workers once again, and this is not coming from ProPublica/NPR.

Here is the article from Business Insurance:

http://www.businessinsurance.com/article/20151029/NEWS08/151029727/constitutionality-of-workers-comp-medical-review-process-upheld-by?tags=|68|309|70|74|92|329|304

We can and should do better, and not just for blue collar workers, but for white collar workers as well. which is what Ms. Stevens is. And I know two other white collar women in CA who have also gotten the shaft from the system. I wrote about them in three separate articles, “The Stench of Fraud: Why Workers’ Comp Can No Longer Be a Closed System“, “The Stench of Fraud, Continued“, and “What Price Profit?“.

From what I have heard about the IMR process, not all of the reviewers are equipped or knowledgeable to review cases, and they only look at medical records (which by one account had been changed), so the process is unfair, no matter what the court said.

Workers’ comp is being undermined from within and without. It is only a matter of time until it it is completely gutted and done away with. That is the fault of stupid and greedy people, but it is also our fault for choosing leaders who allow this to happen because instead of looking out for the people, they look out for the interests of the wealthy and powerful.

New Study Confirms ACA May Shift Claims to Work Comp

The Workers’ Compensation Research Institute (WRCI) released a study today indicating that the Affordable Care Act (ACA) may shift claims into workers’ compensation.

Readers of this blog will have read by now the following posts from earlier this year that discussed at length what many in the workers’ compensation and insurance industries said would happen under the ACA.

Here are the posts:

Accountable Care Organizations May Shift Claims into Workers’ Comp

Failure to Expand Medicaid Could Lead to Cost-Shift to Work Comp

Update on Affordable Care Act’s Impact on Workers’ Comp

Challenges Remain in Physician Payment Reform

The WCRI study is quite long, so I will only give you the introduction and summary of findings. You may purchase the complete study by clicking the following link: http://www.wcrinet.org/result/will_aca_shift_wc_result.html.

The study begins by asking the question, “what is the extent to which the move to “capitated” group health arrangements under the ACA leads to cases that previously would have been paid under group health insurance to end up being paid under workers’ compensation.”

They refer to this as case-shifting, as opposed to cost-shifting, and state that if just 3% of group health cases with soft tissue injuries were shifted to workers’ comp, workers’ comp costs in a state like Pennsylvania could increase by nearly $100 million.

In California, the increase would be higher. More than $225 million, and in Iowa, the additional workers’ compensation costs would be around $25 million, or about 5% of the total benefits paid.

One mechanism the WCRI says by which cases would be shifted to work comp is the growth in the number of patients covered by “capitated” health plans.

Medical providers are reimbursed for each procedure in traditional fee-for-service medicine, which is often called, retrospective reimbursement.

Under capitated plans, the study says, medical providers receive a fixed annual payment per patient, which is often called, prospective reimbursement.

As I reported in my previous articles about cost-shifting, a patient covered by a capitated group plan presents different financial incentives about key decisions to a doctor and the health care organization they belong to, compared with a patient covered by a fee-for-service plan.

For example, if a capitated patient has back pain, the provider and the health organization do not get paid for additional care; whereas, for a patient under fee-for-service, the provider and the organization get paid for each service rendered. Workers’ compensation, the study points out, almost always reimburses on a fee-for-service basis.

Another question the study raised was, “to what extent do the financial incentives facing providers and their health care organizations that arise out of capitation influence the determination of whether or not a case is work-related?

The decision of where to send the bill, the study says, should align with the physician’s assessment of whether the cause was work-related or not. It is the amount of uncertainty about the cause of the medical condition that provides the opportunity, according to the WCRI, for the financial incentives to influence the decision.

How the ACA ties into this is apparent in my post, “Accountable Care Organizations May Shift Claims into Workers’ Comp.” According to the WCRI, the ACA promotes the growth of ACO’s, which will increasingly integrate care from all providers under one capitated payment. They will receive one fixed payment regardless of the treatment the patient receives.

This, they say, will provide strong incentives to classify injuries as workers’ comp cases where possible. To date, over 500 ACO’s have been formed since passage of the ACA.

Additionally, the Obama Administration’s proposed moving to “value-based” reimbursement systems for physicians under Medicare (see my post, “Challenges Remain in Physician Payment Reform”), is also cited in the study as another mechanism leading to case shifting.

The WCRI states that the exact definition of this system is unclear, but that it is widely understood that this would imply more prospective reimbursement.

They point to research that indicates that when Medicare changes its payment system, there is a significant price change among commercial insurers. This, too, could further induce shifting of certain cases, they report. (see “Shared Savings ACO Program reaps the most for Primary-care Physicians”)

What are the findings?

The WCRI looked at three groups of states. The first group was states where capitated plans were very common, the second group was states where capitated plans were somewhat common, and the third group was states where capitated plans were less common.

Case-shifting was only found in states where capitated plans were very common, and there was little case-shifting in the other two groups.

Case-shifting to workers’ comp, the study implies, will be expected to increase as capitation becomes more common.

Here are the key takeaways:

  • Patients covered by a capitated health plan was 11% more likely to have a soft tissue injury (back pain) called work-related than a patient covered by fee-for-service.
  • Patients with conditions for more certain causes (fractures, lacerations, contusions), there was no difference between patients covered by capitation or by fee-for-service; hence no case-shifting.
  • Case-shifting was more likely in states where a higher percentage of workers were covered by capitated plans. Two reasons for this are: more cases would be shifted if more patients were covered by such plans, and when these plans were more common, providers were more aware of the financial incentives to case-shift. In states where at least 22% of workers had capitated plans, the odds of a soft tissue injury being work-related was 31% higher than workers in fee-for-service.
  • In states where capitation was less common, there was no case-shifting. Providers were less aware of financial incentives when capitation was infrequent.

What does this mean?

This study confirms what I have been reporting on for much of the past half year, that the ACA may lead to more claims (or cases) shifted into workers’ comp, thus adding to the cost of medical care under workers’ comp, and further burdening an already burdened and broken system.

But it also confirms that there are rough times ahead for the industry, and that unless new ideas are brought forth and alternatives are seriously considered, and not outright dismissed just because someone say they should be dismissed, no matter how many years’ experience they have in workers’ comp, things will get worse.

The world is changing. Things once thought impossible are possible. Ideas once ridiculed are now accepted reality. No one can stop change, not by saying so, nor by any action on their part, so you might as well open your eyes, ears and minds to new ideas, and not shut them just because you don’t agree with them. One day soon, you will be gone, and the problems will still be there. The way forward is to embrace change now so that the future is better for all.

Clarification

Some of you may be thrown off by the title of this article as meaning that the study confirms that the ACA will lead to case-shifting. That is not what was meant. What was meant was that the study confirms what had been previously reported by others and that I had written about in the posts I referenced in my article. If there was any misconstruction on my part, I apologize.

Consolidation Rolls On In Work Comp

Consolidation was mentioned in the last post as one of the areas of concern over physician payment reform.

Yet, consolidation is also a concern in workers’ compensation, as Joe Paduda reports this morning.

Joe has been keeping tabs on all of the acquisitions occurring in the workers’ comp sphere for a very long time, and one of the main companies involved in these transactions has been Apax Partners, owners of One Call Care Management and GENEX Services.

GENEX has itself been bought or bought other companies in the past three years that I am aware of, thanks to Joe’s reporting.

Reuters, Joe says, reported that Apax is preparing a bid close to $2 billion for peer Helios. Helios is the product itself of a merger between Progressive Medical and PMSI, and is the largest workers’ comp Pharmacy Benefit Manager (PBM).

PMSI was bought by H.I.G. Capital some years back for about $40 million, Joe states, then purchased for probably 8-10 times that figure a couple years ago and merged with Progressive, and there are countless other companies in the work comp service sector that have gone through similar mergers, acquisitions, purchases, etc.

Given the consolidation in the health care sector with hospitals, insurers, and physician practices, especially the development of ACOs, the consolidation on the work comp will also lead to higher cost for services or cuts to services provided.

Competition was supposed to be a good thing in a capitalist society, but as we have seen before in many other industries, leveraged buyouts, mergers and acquisitions, and hostile takeovers have shrunk the competitive sphere, so that in these industries, only a handful of large corporations remain.

Banking, insurance, and financial services, especially Wall Street brokerage firms, have all been consolidated in one form or another, so that now, a company like Goldman Sachs dominates the market after the financial collapse of a few years ago.

Health care and work comp are no different. Perhaps one day, the world of “Rollerball” will become reality, and all companies will be combined into their own industries, headquartered in different cities around the world, as was in that groundbreaking film.

Who knew the highest form of capitalism was really monopoly?

Change for Change’s Sake: What Real Change in Workers’ Comp Looks Like

Note: This is my 200th post, so I think you will find it to be one of the best articles I have written so far.

Every industry has its share of conferences, conventions and meetings around the country. The insurance and risk management industries, which includes the workers’ comp industry, is no exception.

In the early stage of my career, I worked for a small, retail insurance broker on New York’s Long Island, and the men in my company would attend the Risk and Insurance Management Society (RIMS) Conference every year.

I am sure they went there to learn about things other brokers were doing, make connections with insurance company executives, and workers’ comp service providers. But typically, these conferences allowed the participants to hang out with their buddies at the bar, and play a round or two of golf.

So I was mildly amused when I read an article posted today in The Workers’ Compensation Daily from Safety National Insurance Company, titled “It’s Time to Change Workers’ Compensation”.

The article discussed a recent meeting of the Harbor Health Systems 2015 MPN (Medical Provider Networks) Medical Directors, in which an executive from Sedgwick gave the keynote address. His address discussed the need for change in the approach to workers’ comp claims handling.

Harbor Health Systems is based in California, and through the writings of my fellow blogger, David De Paolo, and the personal experiences of two women I previously wrote about, “Ms. X” and “Ms. A”, the California workers’ comp system could use more than a keynote address to change the problems and abuses injured workers are receiving in that state.

FYI, Harbor Health Systems is a subsidiary of One Call Care Management, a company that for the past two years or so has been gobbling up smaller companies, especially in the pharmacy benefit management arena, as well as other smaller workers’ compensation service providers, and as Joe Paduda reported earlier this week, One Call Care Management has acquired an imaging company called MedFocus.

According to Joe, this acquisition consolidates One Call’s stranglehold on the market, so if this is the kind of change Mr. North of Sedgwick was referring to, then it is more of the same.

The article goes on to say that the role of a medical director is to be there to help injured workers to recover from their injuries and resume their lives. I believe “Ms. X” and “Ms. A” would beg to differ.

The article also goes on to say that for years, the workers’ comp medical networks have focused on two things: discount and proximity. They would send injured workers to the physician closest to the employer’s location who would agree to accept a discount on the treatment provided.

Over time, they realized this approach was flawed, and that they should identify the medical providers who produce the best outcomes and incentivize them to treat injured workers by compensating them fairly.

They are learning that when they find these superior physicians, they need to get out of their way and let them practice medicine. The rest of the article details how the industry needs to evolve in how they devote resources to claims, how to better explain the workers’ comp system and protections it provides, and to avail themselves of the opportunities the ACA provides to evolve the way medical care is delivered.

According to Mr. North, when it comes to change, there are three main categories of people:

  • Innovators – people who are truly creating change
  • Learners – people who take what innovators created and work to evolve it
  • Ignorers – people who are uncomfortable with change and have a tendency to ignore it as long as possible

He said that workers’ comp cannot evolve if they are unwilling to take risks and become innovators; otherwise change will not happen.

I agree with his analysis, and my posts have attested to that fact time and time again. Therefore using his categories, it is clear that I would be considered an innovator, since I have been advocating implementing medical travel into workers’ comp.

Workers’ comp needs to take risks, and medical travel affords them of one of those risks.

Yet, those who have derided my idea, or who have not paid any attention to what I am saying, are ignorers, and there may even be people who would see to it that medical travel never becomes part of workers’ comp.

So I would like to add a fourth category to this list. Call them defenders of the status quo, or preventers, or even saboteurs, if it ever got that far.

So what is this change Mr. North is talking about? Is it real change, or just change for the sake of change? And what does real change look like?

Real change is not keeping injured workers and the system locked in a padded cell, wrapped in a straitjacket.

Real change is not buying up smaller companies and cornering the market, so that the very idea of competition is tossed on the dustbin of history.

Real change is not doing the same things over and over again and expecting different results.

Real change is not being afraid to look outside of one’s comfort zone, and outside of one’s national borders at a time when your industry is facing challenges from the expansion of out-out legislation that threatens to destroy workers’ comp, rising medical costs, physician shortages, questions of the constitutionality of exclusive remedy, negative media reports, changes in technology and diversification, and other “seismic shifts”.

Real change is becoming a learner, and I am looking for learners to work with. Real change is being fearless and recognizing that Americans are not the only ones who are able to provide quality medical care.

Real change is going with the flow of change in the world today and joining the globalized world; otherwise you stagnate and die. Time is running out. Real change is possible, but you must go after it.

——————————————————————————————————————————-

I am willing to work with any broker, carrier, or employer interested in saving money on expensive surgeries, and to provide the best care for their injured workers or their client’s employees.

Call me for more information, next steps, or connection strategies at (561) 738-0458 or (561) 603-1685, cell. Email me at: richard_krasner@hotmail.com.

Ask me any questions you may have on how to save money on expensive surgeries under workers’ comp.

Connect with me on LinkedIn, check out my website, FutureComp Consulting, and follow my blog at: richardkrasner.wordpress.com. Share this article, or leave a comment below.