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2016 predictions – how’d I do?

Way back in February I finally got around to making my annual “here’s how I make a fool of myself publicly predicting what I think will happen this year” post.

It’s that time of year – when I have to own up to reality.  So, here’s how I did.

  1. The comp market will soften pretty much everywhere*.
    Rate this a Yes, altho it was a gimme.
  2. *Except in California, where rates are up – and will stay there.
    Nope.  Effective rates are down this year – welcome news indeed.
  3. Liberty Mutual will continue to de-emphasize workers’ comp.
    Looks that way.  Mother Liberty dropped to number 7 on the list of largest workers’ comp insurers in 2015. The move away from WC and towards personal lines has helped Liberty’s financial status, with rating agencies improving the company’s status.
  4. Private equity’s role in the vendor market will decrease – a lot
    Yup. A couple PE firms have been looking hard but these are relatively new entrants to the space.  While there are a bunch of small (<$2 million in earnings) companies doing well, they aren’t big enough to hit the radar of private equity investors.  Yet.
    And, there’s been so much consolidation that the big companies are too big for any but the largest investment firms.
    And OneCall’s struggles have made PE firms leery of the space.
  5. A half-dozen – or more – states will adopt drug formularies
    Wrong.  This is taking far longer than I anticipated.  While a few have moved forward, many others are moving pretty slowly. Tennessee adopted a formulary, California is working on theirs, while things have stalled in Louisiana, North Carolina, Nebraska, and other states. Arizona implemented their chronic pain guidelines in October, which cover all the meds dealing with that condition.
  6. Opt-Out will not gain much traction
    True.  Yeah, I know a bill was introduced in Florida, but that’s the only new news in opt-out this year besides the demise of the Oklahoma experiment.
  7. We will see a couple/several bundled payment pilots
    Rising Medical has initiated one program in a handful of states, UCLA is working on a bundled treatment plan for opioid addiction, Wisconsin state employees are accessing programs (this started last year). So, this is a Yes – albeit not a loud one.
  8. PBMs and payers will make even more progress reducing the use of opioids
    Yes.  Kudos to all for making significant gains in the fight against overuse of opioids.  This has been especially notable in the reduction of opioid scripts for new claims.  We’ve still a loooooong way to go in addressing legacy claims.
  9. A couple of large, vertically integrated delivery systems will make significant moves into occupational medicine
    While there have been a couple reports of joint ventures and expansions, I haven’t seen evidence of much movement here. So, count this as a No.
  10. There will be big changes at OneCall
    Yes.  New senior management; a reduction in sales staff; automation, offshoring and outsourcing of key functions have kept folks in Jacksonville hopping all year.

The net – 7 out of 10 predictions were correct.

Later, I’ll do my prognostications for 2017 – a year that is shaping up to be increasingly hard to predict.

Joe Paduda is the principal of Health Strategy Associates



A national consulting firm specializing in managed care for workers’ compensation, group health and auto, and health care cost containment. We serve insurers, employers and health care providers.



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