Stewardship Program Helps Cut Costs, Improve Results for Employers, Injured Workers
A stewardship program that provides a structure for stakeholders to jointly apply an analytical approach to workers’ compensation claims management has been shown to reduce costs and improve outcomes. Expert panelists at the recent Workers’ Compensation and Disability Conference sponsored by Risk & Insurance cited numerous benefits of a cross-disciplinary collaboration including:
- The ability to establish baselines for comparative analysis.
- An opportunity to focus on trends to illuminate strengths and areas in need of improvement.
- A structure for the development of an action plan that delineates organizational goals, metrics and deliverables.
Each participant has a specific role in the stewardship process, but there also must be open-mindedness, collective buy-in and purpose, the panelists said during a session on Improving Your Workers’ Compensation Program Through Stewardship Meetings.
Getting Started
From the employer’s perspective, one of the first steps is identifying measurable performance indicators and the sources from which data will be collected. A good place to start collecting data is with the company itself, its third-party administrator (TPA) or workers’ compensation carrier, and an external risk management information system vendor.
“You have to share data to get results,” said Sharon Gardner, senior manager of risk management for Chick-fil-A, Inc. “If you don’t trust the carrier/TPA, then you should find another partner. Knowing what you are all trying to accomplish will drive the data Request.” In addition to employer and payer representatives, collaborative partners may include occupational health providers, data analysts, safety consultants, and insurance brokers and agents.
Ms. Gardner also recommended building on the basics by reviewing available “canned” analytical reports, determining what needs to be customized and rating the relevancy of specific measurable factors.
How data are collected also affects the end result. For example, she said issues to consider include:
• Current vs. point in time
• Transactional vs. loss date
• Policy year/calendar year
• Capped vs. uncapped
• Coding accuracy
“We want to focus on the claims that cost the most and spend our time and resources where it makes the most sense,” Ms. Gardner said.
“The goal is to get the best possible care for the injured worker at the best rate.”
Network Penetration
Another way for stewardship partners to better manage the claims process is to analyze managed care network penetration to assess the degree to which price and utilization are under control, said Sheila Clark, vice president and area account executive with Sedgwick CMS, Atlanta. She recommends examining the life of a claim over a 90-day period. “The goal is to get the best possible care for the injured worker at the best Stewardship Program Helps Cut Costs,
Improve Results for Employers, Injured Workers rate,” she said. In reviewing network penetration, it is particularly important to consider, not what has been done, but what may be missing by asking such questions as:
1. Was the “best” provider utilized or did the claimant simply go to the nearest discounted provider?
2. Where is out-of-network leakage occurring?
3. Where and how can treatment be channeled?
4. How do outcomes between in-net-work and out-of-network providers compare?
5. Which outside providers should be nominated for network inclusion?
6. Are up-to-date panel physicians posted at the worksite? (Panels are constantly changing).
In addition, the research is “only meaningful if you have something to benchmark against,” such as data among similar types of industries or in certain jurisdictions, Ms. Clark said. In a five- state study, for instance, Sedgwick found 60 percent of claims billing occurred in-network in Texas, where the company’s benchmark is 67 percent, compared to 93 percent in-network billing in Virginia, where the benchmark is 91 Percent. In Texas, further investigation may reveal valid reasons for not achieving the benchmark. Perhaps care is being delivered in a remote location and the only provider accepting workers’ compensation cases sees no need to join a PPO network, “which isn’t necessarily a bad thing,” Ms. Clark explained. A careful review of in-network and out-of-network use of ancillary services such as diagnostic testing and physical therapy also is an effective strategy, she Added. “Identify the low-hanging fruit and knock off the top three,” Ms. Clark advised employers in the audience. “Be realistic with your timeline and carefully select the data you are going to dive into.”
Avoiding Common Pitfalls
Cindy Larsen, senior vice president and claims consultant with Marsh USA, offered the following timeline to help workers’ compensation system stakeholders engaged in a stewardship program avoid common pitfalls such as “analysis paralysis” and lack of attention to detail:
90 Days Prior to Due Date
• Determine the final report delivery date
• Review prior reports for baseline
• Formulate a preliminary concept
• Confirm process and establish expectations
60 Days Out
• Engage resources
• Conduct preliminary data review
• Discuss initial observations
• Reach preliminary conclusions and identify additional data needs
• Pre-draft report
50 Days Out
• Peer-review report
• Make needed revisions
30 Days Out
• Forward draft report to all partners
15 Days Out
• Finalize report for delivery
“It’s important to have a data analyst available,” Ms. Larsen said. “An account representative may not remember everything that has happened with a Claim. “It boils down to the ability to become change agents,” she said. “You have to be prepared to challenge the status quo. Let the results resonate and guide your next steps. Look at it as a continuous quality improvement on the part of your organization. Be a partner: Everybody has to work collaboratively to drive results.”
