Jan
10

Florida Medical Association blatantly distorts FL Dept of Work Comp report

Warning, this post contains adult language.

Not content with reaching into employers’ pockets and taxpayers’ bank accounts, the physician dispensing industry’s slimy tentacles are oozing into the world of what passes for journalism at the Sunshine State News, and, based on SSN’s own writing, may well be spreading their noxious slime into the Florida Medical Association as well.

Nancy Smith, ostensibly an “editor” at the Sunshine State “News” said this: “A new report from the state Division of Workers’ Compensation (DWC) points to continued interference by insurance carriers into the doctor-patient relationship.”, citing payers’ efforts to control the cost of physician dispensed repackaged drugs.  I’ve read the report – I doubt Smith has – and that is NOT WHAT THE REPORT SAYS.  It doesn’t infer that, imply that, implicitly or explicitly state that or anything close to that.  There are a number of other completely false assertions in Smith’s pathetic piece, but my head will explode if I go into them individually…

Here is the report – and I’d encourage you to send it to Smith on the off-chance she actually decides to read it and correct her gross mischaracterization.  Her email is nsmith@sunshinestatenews.com.

It appears Smith is just parroting a blatantly misleading hatchet job put out by the Florida Medical Association. If the FMA wrote it, shame on them. If it was written by a physician dispensing company and just distributed by FMA, even worse

BTW, I emailed the FMA and asked for a copy of the FMA’s statement about the DWC report.  No response.

The DWC report indicates the number of reimbursement disputes is up some 872% over the prior year, driven primarily by “increases involving physician dispensed medication.”  That’s a good thing; employers and governmental entities, fed up with paying outrageous upcharges for repackaged drugs, are disputing physician dispensers’ bills.  As it is indeed their fiduciary obligation to do, and as they were encouraged to do by the previous CFO of the State of Florida.  In reality, in many of the disputes payers are paying a nominal amount, and end up agreeing to pay what they’d normally pay a retail pharmacy. 

So that’s what the DWC report said.  And somehow this shill who masquerades as a journalist – and/or the FMA, masquerading as a patient advocate – interprets this as insurers interfering in the doctor-patient relationship.

This is absolute, complete, total, utter bullshit.  

Here’s how a colleague put it when asked if insurers are “interfering” :

“…we’re interfering all right.

We’re interfering with their clear abuse of the workers’ compensation system, of employers who foot the bills; we’re interfering with their profit-seeking brethren who hide behind a curtain of their arrogant claim to be a sole protector of their patients, when they can’t know in dispensing repackaged drugs what all other medications their patient might be taking and thereby potentially jeopardizing their patient’s health.  And, we’re interfering with their unethical practices that even their own professional organization has frowned upon.  The AMA has an ethical rule against physician dispensing for profit.   So, yes we’re interfering – and we’re imploring Florida’s policymakers to interfere, to protect the public from the cost abuse, to protect patient safety, and enforce their own medical ethics.  Since the FMA is unable to do this themselves.  That’s what I’d say.”

Here’s what the AMA says in Opinion 8.06

(2) Physicians may not accept any kind of payment or compensation from a drug company [emphasis added] or device manufacturer for prescribing its products. Furthermore, physicians should not be influenced in the prescribing of drugs, devices, or appliances by a direct or indirect financial interest in a firm or other supplier, regardless of whether the firm is a manufacturer, distributor, wholesaler, or repackager of the products involved.

(3) Physicians may own or operate a pharmacy, but generally may not refer their patients to the pharmacy…

Hello, FMA!  Can you spell “conflict of interest”?

Sorry for the adult language – this is the first, and hopefully only – time.


Jan
9

Predictions for the work comp world in 2013 – page three

Now that the easy ones are out of the way, let’s get into the final four predictions.

7.  We’ll learn that physician dispensing of repackaged drugs has harmed patients

When physicians dispense drugs, they don’t have access to the huge databases used by pharmacists to track patients’ meds and alert them to potentially dangerous drug-to-drug interactions.  Moreover, the work comp doc often is seeing the patient for the first time, doesn’t know what drugs they are taking, and the patient often misremembers as well.  This is a recipe for disaster.

This year we will learn of one (or likely more) patients harmed or killed as a result.

8.  The good folk at NCCI will finally schedule a credible liberal speaker for their annual meeting.

After a steady diet of Charles Krauthammers, Arthur Laffers, Peggy Noonans, and Scott Harringtons, it’s time for a little balance – and not a token a la Alan Colmes.  No, we need a  real liberal to shake things up.  How about Barney Frank? Jon Stewart? Rachel Maddow? Bill Moyers? James Carville? Donna Brazile?

Ok, I know it isn’t going to happen, but still, wouldn’t that be great? Alas, I’m afraid we’re going to hear yet another polemic about the evils of socialized medicine, wealth redistribution, and over-regulation…

9.  The level of interest and activity around opting out of workers’ comp will increase – significantly

Driven by growing frustration with the moribund, hide-bound, usually-dysfunctional “system” that is workers comp in most states, employers and legislators will push harder in more states for the ability to opt out of workers’ comp.  See Peter Rousmaniere’s excellent review of Texas’ approach for more on this, and kudos to Sedgwick for funding the project.

10.  Predictive modeling for claims management will come of age.

If there’s one over-hyped yet misunderstood topic in workers comp it’s predictive modeling.  I’m hoping 2013 sees a lot more precision and clarity in articles about, discussions of, and reports on predictive modeling. Less marketing blahblah and more specifics; way less hype generation and a lot more “this is what we did and this is what the results were and this is what we learned”.  There’s no question that effective and targeted statistical analysis can drive much better results; there’s also no question much of what we’ve seen to date shows the talk has not delivered the sought-after results.

However, as studies such as the one published by Dr Ed Bernacki and Jeffrey Austin White of Accident Fund show, there is good work – very good work – being done.  We just need more results; I expect we’ll see more this year…

We shall see what happens, what doesn’t, and what surprises the New Year brings. As it undoubtedly will. 


Jan
8

Predictions for 2013 – page two

Following yesterday’s post on predictions for workers’ comp in 2013, here are three more.

4.  Aetna will keep – and grow – their workers’ comp services business

With the acquisition of Coventry, Aetna consolidated its position as one of the largest health plans in the nation.  They also jumped into a leadership slot in the comp services industry, a business that is attractive to mother Aetna for several reasons. Despite opinions to the contrary, it is all but certain that Aetna will keep and seek to grow the Coventry workers comp business.  That will be welcome news for CEO David Young, who’s long been tasked with generating cash while being starved of resources.

5.  Physician dispensing of repackaged drugs – we’ll see higher prices in some states and much more physician dispensing in many. 

With their gravy train in Illinois and Michigan brought to a screeching halt by new regulations, the physician dispensing industry will drive up prices in those states where the practice is still allowed.  North Carolina, Florida and Maryland are among those states where payers should keep a VERY close watch on dispensing and billing patterns. When and where possible, use direction to steer away from those bad actors…

There are also some distressing reports that the big dispensing firms are looking to hire lobbyists in states that currently prohibit or significantly restrict the practice.  Be on the lookout for this in NY and TX.

6.   Several more states will adopt clinical guidelines to help determine appropriate/medically necessary care.

While this may seem like a no-brainer, the reality – as demonstrated by recent events – suggests it is anything but.  The adoption and effective use of evidence-based clinical guidelines is often subject to political grandstanding, parochial attitudes, and ignorant complaints about “cookbook medicine”.  That said, I’m hopeful we’ll see significant progress in New York, Illinois, California and other states.  The more that evidence-based medicine is the basis for assessing workers comp treatment, the better.

We’ll finish up tomorrow.


Jan
7

Predictions for the workers comp world in 2013

Here’s what I see happening in the world of workers’ comp and WC services in 2013… three today, three tomorrow and the last four Wednesday – unless other news intrudes.

1.  Vendor consolidation

There are two main drivers – the dramatic increase in private equity involvement in workers’ comp services and large payers seeking to internalize services to increase their top lines and bolster profits.  And we ain’t seen nothing yet.  Expect several of the larger players to join forces/be acquired/become “platform” companies that PE firms use to build large, diverse service providers.

2.  Higher medical costs driven by facilities

We have seen harbingers of the future in WCRI’s report on cost drivers in Indiana and other research.  Facilities – hospitals, health care systems, vertically-integrated delivery systems – whatever version or name you want to give them – are becoming an increasingly large, and increasingly expensive provider of medical services to work comp claimants.  According to the latest data, about a third of all physicians are employed by hospitals – and that data is a couple years old.  And, provider consolidation is accelerating – driven by PPACA and market forces as well as much higher Medicare reimbursement (procedures billed by hospitals get paid at higher rates than those billed by docs).

Most WC fee schedules are based on Medicare – or on some mechanism that is even more lucrative.  Thus, as health care systems acquire occ med practices, work comp payers are going to see the same procedure cost more – just because it is billed by a facility rather than a doc.  Providers will figure out work comp is a really profitable line of business.  When they do, they’re going to be upgrading their occ med departments and tying them much more closely to orthopedics, home care, PT, and related services.

3.  Continued ignorance of opioids’ impact on long-term costs and outcomes, coupled with inaction by most payers.

When insurers finally figure out how bad this problem is, they’re going to either go catatonic or their heads will explode. We will know that top execs really understand how bad this is when they get very focused on this issue internally and externally and very demanding of their staff, vendors, and regulators.  This will manifest itself through aggressive efforts to identify and address existing claimants – and not just attempt to prevent extended use of opioids by new claimants. To those who would argue this is already happening, I would respond “perhaps in some small ways at a relatively few payers and in a handful of states, but the response to date is all out of proportion given the size of the problem.”

Three more tomorrow…


Jan
4

MCMC has acquired CompPartners

In a deal just done, workers comp managed care firm MCMC will be/has acquired California-based CompPartners.  The deal gives MCMC a greater footprint in the nation’s largest workers’ comp market, and adds significant strength in physician peer review along with CompPartners’ MPN network.

CompPartners’ clients include the state fund of California (SCIF). Bunch and Associates, Liberty, AIG, TriStar, and Harbor America.  As MCMC does not have much business with most of these, there’s every indication that CP staff will remain in place to serve existing customers and find cross-selling opportunities to deliver MCMC services to Comppartners’ present customer base.

Word from an informed source close to the deal is the two companies will continue to operate separately although cross-selling will be key to leveraging the deal.  The transaction, which closed before the end of the year, was a stock deal which makes a great deal of sense for all parties.

Finally, adding significant strength in California has long been a need for MCMC.  Acquiring CompPartners gives them a staff with long experience and a solid track record in the Golden State, along with a robust client list, certified/licensed product/service offerings, and all the benefits of taking over a going concern.

The net – Smart deal for both parties, and good news for their clients and owners.


Jan
3

Quick News Briefs for work comp folks

First up, another round of applause for the good folks at the Accident Fund  – their use of predictive analytics combined with medical management expertise to identify and intervene in workers comp claims with potentially inappropriate opioid usage was one of the top ten innovations in the entire insurance industry – group, life, property casualty, and reinsurance. (Accident Fund is an HSA consulting client).  Kudos to Jeffrey Austin White, Pat Walsh, Paul Kauffman, and their colleagues and co-workers.  This is EXACTLY the kind of project work comp carriers should – and can – be doing to attack this issue.

A reviewer for Best’s Review put it this way:

“the idea of using predictive analytics informed by medical subject matter experts with workers compensation claims management software in order to identify – and pro-actively facilitate early intervention when appropriate – cases where injured workers might be reliant on opioids…strikes me as particularly innovative…”

In a related bit of news, makers of so-called “tamper-resistant” opioids are losing a battle to prevent generic versions from hitting the market – this means workers’ comp payers’ drug costs will be lower as they won’t have to pay the premium price charged for branded drugs.  While manufacturers Endo and Purdue claim their new formulations are primarily designed to increase patient safety, the timing of their introduction – just as their current brand drugs’ patent protection expires – indicates profits may be the primary motive…

A great summary of the components of the fiscal cliff deal was put together by the National Priorities project.  In chart form, it tells what happened, what it means, and what’s next.  Read it during lunch…

One of the key components of the deal was the extension of current Medicare reimbursement for physicians.  Under SGR, reimbursement was slated to drop 26.5%, however the deal extends current rates for the rest of the year.  As most WC doc fee schedules are tied indirectly to Medicare, in some states this has a direct impact on WC; in all it as an indirect impact as a cut in reimbursement would likely have led to even more cost shifting to comp…

Of note, there are several deals still working in the comp services/managed care arena.  Now that the cliff deal is done, and the deadline for changes in the capital gains rate has passed, we’ll likely see a bit of a slowdown in transactions.  However, even though the capital gains rate is increasing from 15 to 20 percent, there will still be a lot of transactions in 2014, albeit not at the feverish pace we saw at the end of last year.

Finally, with Michigan and Illinois joining the increasing number of states restricting upcharging for repackaged drugs dispensed by physicians, some payers are starting to see price increases for repackaged drugs in Florida, Maryland, and other states where the sky’s the limit.

Tomorrow, predictions for 2013.  Hoping to do better than 65%…


Jan
2

So, how’d those predictions for 2012 turn out?

It’s time to see how my predictions for 2012 turned out, and a final warning that the annual April 1 post is less than three months away…

So here are they are…and here’s how it went…

1. Health reform will impact workers comp…network discounts will diminish…Network options will change.

DING DING.  While the impact of reform is yet to be readily apparent, the data points are trending in that direction. Among the payers I work with and from other data I’ve seen, discounts have eroded and facility costs increased as negotiating leverage has shifted.  And, with the notable exception of Aetna, there was almost no movement among major health plans – including Anthem – to start or beef up their work comp offerings.

2. M&A in comp is going to accelerate.

Well, that was easy.  With deals ranging from Coventry’s sale to Aetna to ScripNet’s to Healthcare Solutions, plus TMS to MSC, MSC to Odyssey, the Align/Smartcomp merger, sale of Injured Workers Pharmacy, plus several others, 2012 may well have been the busiest year ever in this tiny little niche.

3. Comp rates will go up.

True that.  Most states  – from California to Florida to Connecticut to Maine – saw rate increases, with rates level in few e.g. NY (hmmm, perhaps due to political reasons?) and lower in the even fewer states with significant reforms (IL).

4. Attacking opioid addiction and dependency will hit the top of many payers’, regulators’, and employers’ agendas.

Halla-freakin’-luya.  With PBMs’ opioid programs getting major traction with many clients (at last); IAIABC and AIA developing policies/model language on the topic; an entire, and quite well-attended, track at NWCDC devoted to the issue; major progress in Texas and Washington; a first-ever conference on the subject attracting over 600 attendees (Operation UNITE), and every pundit and opinionator now on the band wagon, you couldn’t swing the proverbial hat without smacking into an opioid program/conversation/report.

We need more.

5. Now that Illinois is starting to approve Preferred Provider Programs, there will be lots of interest followed by disappointment that they really don’t do much to control over-utilization.

Premature at best.  The approval process has been somewhat slow, perhaps due to what appears to be a very methodical approach to writing the regs.  Jury’s out, till we have some actual PPP performance.

6. As work comp premiums begin to rise, we’re going to see a renewed interest in loss control, risk management, and medical management.

A guarded yes, with particular focus on opioids (see above), utilization management (see California), networks and specialty managed care.  To be entirely accurate – which is a noble if unattainable goal – my sense is a lot of the attention focused on specialty managed care is due to the dollars flooding into the space from private equity firms, a flow that has gotten a LOT of attention from payers.

Not much news about more work on loss control or risk management, so it may well be that this prognostication was premature.  As this would make the prediction only one-third accurate, I’ll count this a ‘no”.

7. The physician dispensing cost control bill currently pending in Florida will pass.

No DAMN IT.  Despite the dedicated, noble and diligent efforts of Senator Alan Hays (the most straight-forward and direct elected official I’ve ever had the pleasure to meet), the bill was never brought to a vote in the Senate, as then-Senate-President Mike Haridopolous refused to allow it to be brought to the floor.  If you’re wondering if the $3.4 million spent on lobbying and contributions by the physician dispensing industry had something to do with Haridopolous’ position, I’d say you’re pretty damn naive to “wonder”.

That said, there was GREAT news in Illinois and most recently Michigan, where the profiteering plunderers who suck money out of employers’/taxpayers pockets were dealt severe setbacks when regulations preventing upcharging for repackaged drugs.

8. More payers will diversify their provider network partners.

Done.  There are more payers working with more networks than before, and more bill review companies are offering more generalist and specialty networks than ever.

9. York Claims will finish the year well on its way to becoming a top-tier TPA.

It is.  With the acquisition of JI Companies and organic growth to boot, they’ve had a pretty good year in terms of revenue growth  York’s programs, staff, and capabilities – as well as the approach they take to medical management – are as good as anyone’s.

10. Oklahoma will eliminate the requirement that all employers have workers comp insurance.

Well, blew that one too.

So, here’s the score.

3 – NOs

6 – YESes

1 –  NOT YET BUT ON THE WAY.

If this was baseball, I’d be earning gazillions…alas it isn’t so.