North Dakota’s chickens are coming home to roost

Well, when you falsely accuse a (very) competent public servant of malfeasance and get rid of him, you get what you deserve.
That’s exactly what’s happening in North Dakota. The state workers comp fund (WSI) is dealing with two separate scandals, one involving alleged illegal removal of a nurse’s entry from a claim file, and the other alleged efforts by management to manipulate WSI’s Medical Director to change his medical opinions.
You would think that the current CEO, Bryan Klipfel, would be on this like white on rice. Alas, Klipfel stumbled into this job, with a grand total of zero prior experience in workers comp, insurance, medical care, rehab, finance, or customer service. But he was a “good listener…”
According to press reports, WSI’s “chief doctor who reviews injured North Dakota workers’ compensation claims said he twice resisted efforts by agency managers to alter his medical opinion.
Dr. Luis Vilella, the medical director for Workforce Safety and Insurance, said he refused to change his medical opinions when asked to do so on two occasions in February or March of 2010.”
I don’t know if the recent effort by WSI management to establish more control over their medical directors is related to those two earlier attempts to get Viella to alter his opinion, but the coincidence is certainly worthy of investigation.
Reading Klipfel’s comments on these issues, it is easy to see just how big a screw up the powers that be made in ousting Sandy Blunt and putting Klipfel, a complete newcomer to business, let alone insurance, never mind workers comp, in charge. Evidently WSI was working on this “policy”, but only submitted it to the state board of medical examiners after Viella asked for the Board’s help. According to press reports, Kilpfel said: “This is a draft policy…We were going to have some work done on it. We want to make sure the policy we have reflects the longstanding policy that legal never drives medical in handling our claims.”
As anyone who knows anything about comp learns on day one, you do NOT mess with medical opinions, and you most certainly do NOT try to get your medical director to alter his or hers’. Yet WSI was in the process of reviewing a policy that would “dictate how medical opinions are to be transcribed, documented, or recorded.”
That’s not all. A WSI nurse case manager found that her entry in a claim file was deleted by a claims manager who didn’t like that the case manager’s statement strengthened the claimant’s case.
Well, folks, you get what you deserve. The real reason Sandy Blunt was prosecuted was because he was working his butt off to reform a dysfunctional state agency that had long been subject to political manipulation; Blunt didn’t stand for that. Now he’s out, a complete incompetent is running the place, and the citizens of North Dakota are paying the price.
The chickens are coming home to roost. Someone is going to have a big job shoveling out the coop after Klipfel et al move out.
Or, as Bob Wilson notes, the dodos are the ones doing the roosting..


What is your hand worth?

Three numbskulls in South Carolina decided one hand was worth $671,000, the amount they collected from various insurance policies after sawing off one of their six hands.
Yep, one idiot agreed to have his hand cut off so he and his fellows could split the take from three AD&D policies; no word on how they picked which one would give it up for his buddies, nor if he got more of the take as compensation.
Evidently the FBI found out about the three stooges some time after the amputation and subsequent remuneration, Christina Bramlet of PropertyCasualty360 reported (in a pun-filled piece) on the event.
The surgical instrument of choice was – brace yourself – a pole saw. One of those long poles with a combination saw and lopper at the end for trimming branches in trees. No word if it was powered or manual…
So, walk me through this.
You’re sitting around with your buddies, likely a few beers into the evening, and you confess your deep sense of shame over your life-long-hand-to-mouth existence. Someone says he heard of someone else who collected big bucks from an accident where he lost his arm.

The lightbulb goes off.
..among this triumvirate, a rare event to be sure.
Then, the debate starts – no, it’s not “if”; it’s “who”.
How do you pick the unlucky co-conspirator? draw straws? rock-paper-scissors? flip coins? odds and evens, with odd man out losing his left?
Do you follow thru then, or give the unlucky guy a couple days with his soon-to-be-departed appendage, a sort of farewell tour. Maybe play a little baseball, tickle the ivories, tie a couple knots, drive a manual transmission car a few miles, button a few shirts, go a couple rounds with the ol’ pinball machine?
Or just grab the nearest sharp object and start whacking away?
And who has to do the surgery? Do both of the lucky ones agree they’ll do it together, to spread the guilt around, or maybe just see what it feels like to cripple a good friend?
Too bad there’s not a category for on-purpose maiming in the annual Darwin Awards...


Health reform, jobs lost and jobs gained

My post yesterday about the impact of health reform on employment generated an email from NFIB’s Bob Graboyes correcting an error in attribution (thanks Bob). It also got me to dig deeper into the issue of employment and reform – specifically, what’s the net effect – what jobs and how many will be lost to to PPACA, and what jobs and how many will be gained as a result of health reform.
Let’s leave aside the fact that with reform it will be a lot easier for workers to move from a big company and their health plan to individually-insured plan, enabling more would-be entrepreneurs to start their own firms.
According to Monster, there will be a plethora of new jobs for technicians, clinicians, and support workers.
And NFIB’s own analysis estimates the employer mandate [opens pdf, see p 20] – the old one, not the one that exempted employers with fewer than 50 workers – would have created 890,000 jobs. (NFIB hasn’t updated their numbers to reflect the lack of mandate for small employers.)
That said, NFIB indicated the mandate would create a lot of jobs – and good paying ones at that:
“The employer mandate would boost demand for healthcare goods and services, thereby increasing employment in healthcare-related sectors. The number of ambulatory healthcare professionals (physicians, dentists, and other healthcare practitioners) needed will increase by 330,000. An additional 327,000 staff will be required to work in hospitals. Some 157,000 more nurses (net of retirements) will be needed to staff doctors’ offices, outpatient clinics, and other provider locations. And payrolls at insurance companies will expand by 76,000 workers.”
Okay, so we have 330,000 more jobs for docs and dentists, and 157,000 net new openings for nurses. That’s almost half a million new high-paying jobs; these aren’t retail clerks, burger flippers or car wash attendees, these are folks making from $50,000 to $400,000.
True, some jobs will be lost, but we don’t know if there will be a net loss or gain. But lets say there’s a net loss. According to NFIB, the vast majority of the jobs we’ll lose are in retail and food service.
Marketwatch notes that the Sunshine State may well see more jobs added as a result of reform. The article goes on to note some experts’ opinions that while there will be more jobs open, many will go unfilled due to a lack of trained clinicians.
One hopes that the invisible hand will remedy this situation.
Of course, we’d be much better off if we could look into the future. Fortunately, we can. Recall Massachusetts enacted legislation very similar to PPACA back in 2009.
Overall, employment gains in healthcare Massachusetts have outstripped the rest of the country by four points; Mass added 9.5% more health care jobs since passage of reform while the rest of the nation averaged 5.5%.
But the impact wasn’t just on health care job counts. While the rest of the country saw a 2.9% drop in employment since Massachusetts passed reform, Mass’ employment dropped by a mere 0.2%.
What does this mean?
Well, there will likely be fewer overall jobs, but there will be a lot of new, high-paying jobs that may balance out the loss of what look to be lower paying jobs.


Physician dispensing and auto insurance

Over the last couple weeks I’ve fielded several calls from automobile insurance companies seeking information about the big drug bills they’ve been getting for physician dispensed drugs.
This is more of an issue in states with high dollar coverage for medical costs, but there’s increasing evidence that physician dispensing is hitting more and more auto claimants in many different jurisdictions.
There’s several reasons these bad actors are pushing into auto.
1. some states are controlling the pricing of repackaged/physician dispensed medications for workers comp, so docs – and their suppliers – are looking for greener pastures.
2. many auto insurers aren’t yet aware of the practice, so they’re just paying the bills without much scrutiny
3. it’s profitable – really, really profitable.
There’s a downside for consumers as well as their insurers. In addition to the added health risks inherent in physician-dispensed medications, these inflated charges also cause insureds to reach their policy limits much faster, thereby running out of insurance coverage for their medical costs.
This is happening in Hawai’i, Michigan, Georgia, Florida, and likely many other states.
So, what’s an auto insurer to do?

I suggest you start by figuring out the size of the problem. Find out the TINs these entities are billing under, total up their charges, scripts, and your payments, and see how bad it is.
If it’s not much, that’s great – for now. That won’t last.


Obamacare and jobs

Will the health reform bill kill jobs? Devastate small businesses? Push us back into recession?
According to several organizations and and anti=reform politicians, it’s the worst thing to hit the economy since the Depression.
But it turns out those doomsayers are mostly wrong.
Here’s what FactCheck.com says about these claims:
“this is health-care hooey, aimed at exploiting public concern over continuing high unemployment, with little basis in fact.
As we’ve said before (a few times), experts project that the law will cause a small loss of low-wage jobs — and also some gains in better-paid jobs in the health care and insurance industries. [emphasis added]
It’s also expected that more workers will decide to retire earlier, or work fewer hours, when they no longer need employer-sponsored insurance and can obtain it on their own with help from federal subsidies. But that just means fewer people willing to work — and it will free up jobs for those who want them. If anything, that could reduce the jobless rate.” [emphasis added]
Here are a few factoids about the PPACA (aka Accountable Care Act) that seem to have escaped the attention of those concerned about health reform and jobs.
– some employers with fewer than 25 FTEs are already receiving government aid to help defray the cost of insurance
– employers with fewer than 50 FTEs are exempt from the requirement to provide coverage
– the original CBO analysis of reform’s impact on employment [opens pdf] indicated job losses from the employer mandate “would probably be small.”
In fact, the jobs picture, according to the CBO, is mixed.
“According to CBO’s August 2010 analysis, the legislation, on net, will reduce the amount of labor used in the economy by a small amount–roughly half a percent–primarily by reducing the amount of labor that workers choose to supply.30 That net effect reflects changes in incentives in the labor market that operate in both directions: Some provisions of the legislation will discourage people from working more hours or entering the workforce, and other provisions will encourage them to work more.”
The well-regarded Lewin Group concurs:
“Lewin’s analysis showed 150,000 to 300,000 jobs lost, all minimum wage or near minimum wage positions that would be lost permanently. That doesn’t account for increases in jobs in other sectors, mainly health care, that Sheils also expects but hasn’t quantified.”
There are entities with different opinions, but they are not neutral parties. Again, here’s FactCheck:
“a study by the National Federation of Independent Business…projecting a 1.6 million job loss…was issued Jan. 26, 2009 — well over a year before the new law was actually enacted. NFIB has not issued any study of what actually became law, and one of this study’s authors, Michael Chow, told us by e-mail that it has no present plans to do so…
NFIB did not study the new law. Its report was based on a hypothetical employer mandate that bears little resemblance to what was actually passed — and it also projects a gain of hundreds of thousands of health care and insurance industry jobs.”
I’d note that this hasn’t stopped the GOP from using the 1.6 million lost job figure when referring to jobs lost due to PPACA…
(note – an earlier version credited the NFIB with continued usage of the 1.6 million statistic; I should have said the GOP. I regret the error)
What does this mean for you?
While there are problems with PPACA, while it is far from perfect, and while it could stand improvement in many areas, no matter what NFIB et al claim, it is not a “job-killer.”


The Hawaiian political charade

I received an email from an individual who attended a “hearing” on a workers comp bill in Hawai’i. It’s compelling for two reasons – it clearly illustrates the comp system’s vulnerability to manipulation by those seeking ever-greater profits and ever-lesser oversight, and the weakness and inadequacy of employers’ and insurers’ efforts to prevent that manipulation.
Here’s the perspective of Charlie Donovan – and no, Mr Donovan is not an insurance guy; in fact he works for a group of physicians that serve workers comp claimants.
“I was bothered by the fact that one of the biggest supporters of the [IME] bill, and from my understanding one of the most active participants in fundraising for Senator [Josh] Green [orthopedic surgeon and drug dispensing physician], was not only given the chance to testify, but was called upon again to answer questions in front of the committee.
I was incensed that there were 2 orthopedic surgeons with over 50 years of combined experience treating patients, performing surgery, and conducting IMEs sitting 10 feet in front of Sen. Green who were not given the time of day.
And it seemed so blatantly unfair that an injured worker who had driven in “all the way from Waianae” was given a chance to testify, but that a neurologist with over 30 years of experience who flew in from Maui to give testimony was not afforded the chance to speak.
But when testimony was closed, I looked at my watch and saw that barely 40 minutes had expired since the hearing was gaveled to order. With easily 2 dozen more people anxiously waiting to have their opinions heard, it was over.
Epiphany!!! The entire hearing had been a charade. The members of the committees who graced us with their presence (all 6 of them) were not interested at all in being educated, or in hearing what the “public” had to say. Passage of that bill was a “done deal” before anyone walked into the room, and the hearing was nothing more than an inconvenience for the committee members.
I suppose that I was naïve for thinking that “public testimony” really mattered, that years of experience, statistical data, and the opinions of other professionals would trump fundraising donations. I suppose that somewhere down deep I knew that politics was a dirty business, and that “public service” was a catch-phrase of absolutely no significance. But part of me didn’t want to admit it, until it was rammed down my throat in the most transparent piece of kabuki I have ever seen.
So while facts comes before fundraising in the dictionary, I must now begrudgingly admit something that I probably already knew – that the order is obviously quite different in the world of politics.
Like wandering behind a horse and getting kicked, this is a lesson that will not have to be taught twice.”
What does this mean for you?
Insurers and employers better get real, and fast. You are going to get your heads handed to you if you don’t stop dissembling and focus on these issues.

Workers comp is a very, very soft target for profiteering physicians and the various businesses that have sprung up to suck money out of employers’ premium checks. They are organized, very well-funded, and aggressive.
Meanwhile, insurers and employers are sitting idly by while these bad actors use your dollars to buy political influence.


Hawaii’s (likely) evisceration of the workers’ comp system

After posting last week on the politicization of the physician dispensing issue in Hawai’i, I heard from a number of stakeholders alarmed by that – and other issues.
Chris Brigham, MD, has been following what can only be described as an effort to eviscerate Hawaii’s workers comp system. He contributes these observations to MCM.
The Aloha State has been friendly to physician dispensing and to certain legislative officials, including Senator Clayton Hee, Chairman of the Senate Judiciary and Labor Committee, receiving funding from individuals and entities associated with physician dispensing companies [Hee’s contributors were identified in MCM last week; last week I referenced a physician dispensing cost control bill that would take steps to deal with this issue, however the bill is likely to end up in the Committee and die.]
Physician practices involved in physician dispensing lobbied very actively for another bill, a bill that would effectively thwart the independent medical evaluation process in Hawaii.
HB 466 was passed this week by the State’s Joint Committee on Judiciary and Labor and the Committee on Health (chaired by Senator Josh Green, MD, who has also been the recipient of fund raising by interests aligned with physician dispensing companies.) This bill would require independent medical evaluations (IMEs) to be performed upon mutual agreement of the injured employee and the employer. The attitude and behavior of the treating physician heavily influences the patient; if the treating physician feels threatened by the IME physician, it’s likely the treating doc will advise the patient to reject the evaluation. Thus, what this bill really means is the treating doctor and employer have to agree on an IME. If there is no agreement, the evaluation is assigned by the director to a doctor from a list of qualified physicians maintained by the state.
At the hearing, a physician who heads up a large practice involved in physician dispensing stated he would be pleased to provide names of physicians qualified to be on the “list”. Interestingly, documents reveal that certain physicians charge a fee of $3500 for an IME for one of their own patients and the resulting five page report. Curious how a doctor could perform an “independent” evaluation on his own patient…
This bill also limits IMEs to one per case, unless valid reasons exist with regard to treatment. How does this deal with various issues that occur during a life of a claim and to multiple problems? What is the rationale or need for this legislation? No studies have been performed to demonstrate a problem. Hawaii has been known for high quality IME reports and, according to data published in the AMA Guides Newsletter March / April 2010; Hawaii has the highest degree of accuracy in impairment ratings in the country.
How is this state going to deal with changes that are likely to dramatically increase costs and result in delayed case closure? This is particularly problematic given Hawaii’s state budget shortfall. This legislation appears to be responding to a non-existent problem, rather than addressing any issue of questionable care. If decision makers are rational, recognize the true issues, understand there is no money to pay for the proposed needless changes, and do not make decisions influenced by who sponsors their campaigns, there is still a slim opportunity for defeat. I’m not optimistic.
In terms of thwarting bad care, could it get worst for Hawaii? Yes.
The same parties are advocating passage of a bill to allow the Director to approve treatment plans without a hearing if they are disputed by the employer, a bill to permit the Director or claimant to reopen cases even years after they are resolved by settlement if a question arises concerning undue influence or the injured worker’s mental competence, and a bill to allow attorney’s fees to be awarded if a claim is prosecuted or defended without good cause. Attempts to bring evidence-based medicine to Hawaii have been thwarted.
What does this mean for you?
Beware of strategies by certain stakeholders who are attempting to alter the workers’ compensation system through legislation to be more “friendly” to them – even if it results in increased costs (human and financial).
Recognize that some of these stakeholders may well be seeking influence through contributions to key legislative decision makers; Money talks. Recognize despite its beauty, not all is perfect in Hawaii – it is a wonderful place to visit, however you probably would not want to have a business or be injured there.


Physician dispensing comes to Connecticut

Inflated costs for employers and insurers, higher taxes for state residents, and riskier medical treatment for injured workers – all are on the horizon if Connecticut Workers’ Compensation Commission Chairman Mastropietro allows physicians to dispense repackaged drugs to injured workers.
Mastropietro held a hearing yesterday where 4uDoctor attempted to convince all in attendance that the inflated cost of physician-dispensed repackaged drugs is actually a good deal.
Most weren’t buying their claims, nor should they. On the contrary, as their website states, 4uDoctor highlights their ability to”Generate significant additional ancillary revenue” for physicians.
4uDoctor’s claims for patient benefits are easily debunked.
There’s NO evidence that physician dispensing improves compliance, speeds return to work, or improves outcomes. None. Zilch. Nada. In fact, Chairman Mastropietro may want to focus on the patient safety issue; here’s why.
Work comp claimants are usually treated by docs that haven’t seen the claimant before the occupational injury; this almost always is the case in Connecticut where most employers can send injured workers to physicians who specialize in treating work comp conditions. While the WC doc certainly asks about prior medical history, current medications and the like, it is not uncommon for patients to forget which meds they take or be unable to accurately identify their drugs.
Not so big an issue if the claimant goes to their usual pharmacy, where the system will identify any potential conflicts and notify the dispensing pharmacist.
A bigger issue arises if the treating doc doesn’t get the full story, prescribes and dispenses meds that conflict with the claimants’ other meds. Then, the patient may be harmed, and because this harm comes as a result of treatment for a work comp injury, the employer is on the hook for any additional medical care.
To further rebut 4uDoctor’s argument for patient benefits, note that their dispensing is only for workers comp patients. Why can’t the docs’ other patients benefit from “improved compliance…convenience…confidentiality”? Perhaps it is because Medicare and group health plans won’t pay inflated prices, but work comp payers may be forced to (if the Commission doesn’t do the right thing).
What does this mean for you?
Physician dispensing drives up costs for employers, increases taxes, and kills jobs. This is little more than a big money-maker for a few, paid for by the rest of us.

If you agree, please pass this on to the Connecticut Workers Compensation Commission Chair at wcc.chairmansoffice@po.state.ct.us


The healthcare economist’s view

Jason Shafrin’s hosting this fortnight’s edition of Health Wonk Review, covering issues from birth control to Sen Santorum’s health care platform.
One notable entry is Maggie Mahar‘s observations on the cost – or lack thereof of contraception: “A 2000 study by the National Business Group on Health estimates that not providing contraceptive coverage in employee health plans winds up costing employers 15% to 17% more than providing such coverage.”


Santorum on health care – fiscally conservative or not?

Now that Rick Santorum has grabbed the hot potato known as the ‘GOP presidential race front-runner‘, it’s time to learn about his stance on health care, his platform, and his history.
Let’s start with past history; while platforms and political statements are kinda interesting, it is always instructive to see what candidates did before they became candidates.
Before we dive in, let’s remember our guy Rick is an avowed small-government fiscal conservative. (SGC).
Got that? OK, off we go!
First, SGFC Santorum voted for Medicare Part D, even while acknowledging he didn’t like the lack of any funding for the handout to the elderly. FYI – Part D’s share of the nation’s debt is now over $16 trillion
While in the Senate, SGFC Santorum worked his butt off to to include extra spending in a Medicare overhaul for hospitals in Puerto Rico. The extra spending, funded by taxpayers to the tune of $400 million, would have directly benefited Universal Health Services, a hospital management company based in his home state of PA. Santorum wasn’t entirely successful but that didn’t stop him from reaping the benefits of the revolving door; according to newspaper accounts, “Within months of leaving the Senate, SGFC Santorum joined the board of Universal Health Services, where he collected $395,000 in director’s fees and stock options before resigning last year.”
Santorum’s platform is best characterized as “platitudinous” – rife with paeans to the wonders of the free market, personal choice, doctor-centric care and other blather, along with the standard rants describing “Obamacare” as “cruel”, “one-size-fits-all”, “job-destroying”. But there’s nothing substantive beyond calls for repealing Obamacare and making Medicaid a block-grant program.
Noticeably, the platform of this champion of the free market does NOT mention SGFC Santorum’s support for Paul Ryan’s Medicare voucher system. A more public acknowledgement would be unwelcome among the over-65 set, and likely wouldn’t endear him to his UHS buddies either.
Oh, Santorum does echo the usual Republican call to allow individuals to purchase insurance across state lines, as if this amazingly-naive approach would actually do anything to address cost or increase choice, while hypocritically denying states’ rights to control heath insurance within their borders (wait…isn’t Santorum in favor of states setting their own health care policies?)
One of the more trenchant reviews of Santorum’s platform is fromDavid Williams; his dissection of Santorum’s health care tenets is well worth considering:
“It’s interesting that he’s calling for universal, affordable access. Sounds a lot like the Patient Protection and Affordable Care Act (PPACA). The only difference is this piece about “government bureaucrats.” I wonder what specific elements of PPACA he means by this -because I don’t see a lot of interference in “health care decisions” in the Act relative to the pre-PPACA days.
It’s hard to argue with the idea of “targeted” and “patient-centered” solutions. And actually, that’s the path taken by PPACA. Didn’t opponents criticize the length of the bill? A lot of that is because there are many different targeted approaches taken: some for individuals, others for small business, others for medium sized organizations, still others for large entities. Other targeted interventions are in place for high-risk patients…”
One last thing. SGFC Santorum also doesn’t believe in evolution.
Oh my.