Author: Joe Paduda

Feb
6

Friday catch-up

Posted by Joe Paduda on Friday, February 6th, 2015 | Comments

Just two things today – Let’s start with the CorVel – Fort Worth PD incident.  After a police officer was shot, CorVel sent a nurse to the hospital, where the nurse was accused of asking “inflammatory” questions by an outraged Mayor.  This hit the print and video media, and CorVel has been pilloried by some for “insensitivity”.

My take is this appears to be blatantly unfair to CorVel and the responding nurse.

According to a piece in WorkCompCentral this morning, an internal investigation at CorVel indicates the nurse acted appropriately; CorVel is supposed to send a nurse immediately upon notice of a catastrophic injuries – standard practice across the industry. The nurse has a list of questions to ask, including the condition of the injured employee.  Evidently the nurse asked the family these questions, and the family was upset.  According to CorVel, the police liaison person mishandled the nurse’s visit.

I’m no CorVel fan, but they are getting a raw deal here.  CorVel has apologized to the family; from what I’ve read it looks like the Mayor is the one who should be doing the apologizing.

Bob Wilson has a slightly different perspective; he notes timing is everything.  True indeed, altho in this case CorVel would have been damned if the nurse wasn’t doing what s/he was supposed to when s/he was supposed to.

Coming on the heels of a not-favorable earnings report – with lower overall earnings driven by declining profits on the TPA and network businesses – this must make for some unhappy execs at CorVel HQ.

Maryland’s dropped the ball on doc dispensing in work comp

I’ve got to take state legislators, a few insurers, and the regulators to task here.  A number of stakeholders signed a letter agreeing to not propose legislation to address doc dispensing for the next two years.  They based this decision on data provided to the Workers’ Compensation Commission, data that – according to the Commission’s Chair – showed a decrease in physician dispensing from 2011 to 2014.

The Chair – Karl Aumann – is a good man, but I have to challenge this assertion.  I haven’t seen the report that Chairman Aumann is referring to, but hope to get a copy.  In the interim, I defer to WCRI, which reports an increase in doc dispensing in Maryland.  For some reason Aumann doesn’t trust WCRI’s information, which makes him one of the very few people who take issue with that august institution’s findings.

What’s most troubling is the letter  – and the logic for the legislative hiatus – completely ignores the biggest problem with doc dispensing; medical costs are higher, disability is longer, and indemnity expenses are higher.  The “it isn’t as bad as it used to be” logic is faulty at best.

I’d also note the letter misstates AIA – the American Insurance Association’s “position” on the legislative hiatus.  My sources indicate that AIA did and does have a position; they were NOT in favor of a hiatus and wanted a bill that would address the core issue.

This is a big weekend – it’s the opening of the college lacrosse season – here’s hoping your team does well…unless it’s Siena…

Feb
5

The now-notorious 59 modifier

Posted by Joe Paduda on Thursday, February 5th, 2015 | Comments

I’m really puzzled about two things.

After 4500+ views of my post re the 59 modifier and its use/abuse, an energetic conversation on Mark Walls’ LinkedIn group on the topic, and a bunch of conversations with PT providers, what’s surprising is the:

  • apparent lack of concern amongst most PT providers about this, and
  • the lengths to which some are going to spin this as a “non-issue”

For the providers, it isn’t so much a lack of concern as misplaced anger.  Many of the  commenters and PTs I’ve spoken with are painting all managed care companies with the same broad brush, an approach that is as unfair and wrong-headed as characterizing all PTs as over-utilizers.  Do networks make money by connecting providers and payers? Yes.

Is this somehow “bad”? Of course not.  Aggregators work in every industry in this country – from insurance to hospital supplies to shoes to department stores to travel.

In work comp, there are networks that don’t alter provider treatment codes, and there are networks that do.  If you want to know if your network does, ask them.

Providers should be focusing on the impact of networks adding the 59 modifier to the treating providers’ bills.

Specifically;

  • are you, treating provider, getting paid fairly for this treatment that you allegedly didn’t bill correctly for?
  • your treatment records now reflect higher utilization for many patients; as networks are constantly evaluating and assessing provider performance, are you being judged fairly?

OK, on to the messaging.

There is an obtusely-worded document currently circulating that makes several rather stunning statements, including:

  • Treating providers correctly use the 59 modifier the vast majority of the time
  • 59 modifiers should be used on less than ten percent of PT bills
  • The network reviews the clinical documentation and adds the 59 modifier if appropriate

Given that some HSA clients have seen modifiers on more than 40 percent of their bills, it’s hard to see how a network could take the time to individually review clinical documentation on each and every bill, then make a determination that 40% of bills needed to be changed.

Especially when those treating providers bill correctly the vast majority of the time.

The coding experts I have spoken with all agree: no network should ever change a treating provider’s coding, which this document indicates the network actually is doing.  OK, perhaps the coding experts I spoke with don’t know what they’re talking about…

and perhaps your spouse is going to win “The Voice”.

We are left with the rather clear statement that less than 10% of provider bills should include the 59 modifier.

What does this mean to you?

If more than 20% of PT provider bills include the 59 modifier, somebody got some ‘splainin to do…

because your PT costs and “savings” may well be inflated.

Feb
3

Update on OneCall’s executive moves

Posted by Joe Paduda on Tuesday, February 3rd, 2015 | Comments

In a press release issued late yesterday, OneCall Care Management indicated the company had named Chris Watson as EVP Operations.  While the release doesn’t provide any clear indication if this position is superior to the current two “divisional” COOs, word is Watson will have overall responsibility for all operations.

A press release about Ms Lane’s new position noted that Bob Zeccardi will “continue in his role as CSMO (Chief Sales and Marketing Officer); I had written yesterday “Long-time sales boss and all-around good guy Bob Zeccardi has moved into a different role, partially replaced by Matt Dougherty, former eastern regional sales VP.”

Clearly, Bob remains as CSMO; my earlier characterization of a “new role” for Bob may well be in error.  Not trying to dissemble here, rather basing this on sources indicating sales will be aligned with the two operational “divisions” (my word, not theirs) with DME (labeled EDM for some reason by OCCM insiders) home health, dental and “doctor” in one division and PT, Imaging, and Transportation/Translation (T&T) in the other.

I asked OCCM’s PR folks for clarification and received copies of three press releases; one referenced above, one about Linda Lane’s new position as EVP Business Development, and one about their CIO (which I noted yesterday), followed by a statement to the effect that they wouldn’t comment on sales strategy and alignment as that is proprietary.

Be that as it may, if there have – or haven’t – been changes we’ll know pretty soon.

(Note only one of these releases is up on their site; the two dated yesterday aren’t up yet. Sometimes it takes a little time to get press releases posted to company websites.)

Hat tip to WorkCompCentral for the notice…

Feb
2

Quite a Friday

Posted by Joe Paduda on Monday, February 2nd, 2015 | Comments

While the dust is a long way from settled, it is quite apparent there have been some major changes in personnel among some of the big players in workers comp services.

Two senior Coventry staff – industry veteran and network expert Bruce Singleton and COO Chris Watson – have moved on, with Singleton reportedly bound for Multiplan.

Coventry has promoted a divisional operator to the COO slot.

Watson is now at OneCall Care Management; different takes on his role.  Currently there are two COOs; one (Dave Olson) over PT, T&T, and imaging and another (Will Smith) on DME, home health, dental and the rest of the business.  Will be interesting to see how Watson fits in.

Long-time sales boss and all-around good guy Bob Zeccardi has moved into a different role, partially replaced by Matt Dougherty, former eastern regional sales VP.  In account management, Linda Lane has relinquished her position as head of account management to assume sole responsibility for servicing a couple of major accounts.  Her replacement is reportedly Jeff Flannagan.

Aaron Quick, a key executive involved with some of Align’s largest accounts, also resigned recently.

And, in the only public announcement, OCCM hired a new CIO on Friday as well, this time from outside the industry.

Word is there may be more changes afoot in OCCM’s C-suite – if they haven’t a;ready happened.

What’s driving these changes?

I’d guess Coventry folks have been reading the proverbial wall writing and are only too glad to move on.

As for OCCM – major changes in sales, account management, operations, and IT leadership point to rather more dramatic goings-on.

it appears the Align folks are ascendant; I won’t speculate as to why Apax saw fit to bring in another operator – if, in fact, Watson is in that role.

We will know a lot more this week.  Here’s hoping this works out well for those who deserve it to.

Jan
30

Fraud? Abuse? Ignorance?

Posted by Joe Paduda on Friday, January 30th, 2015 | Comments

I promise your eyes will NOT glaze over – but you need to know what’s going on in the arcane world of procedure coding. Why?

Because your PT costs may be $15-$19 per visit higher than they should be.  And the savings your vendor is touting might be even more inflated.

Here’s what’s going on – and remember, this is specific to PT.

It’s common for therapists to perform multiple procedures at the same time – on a single body part.  There’s a list of procedures that are commonly performed together, and unless the therapist adds a specific modifier to the procedure code, only one will be reimbursed.

Nationally accepted standards (under CMS’ National Correct Coding Initiative) allow the therapist to be reimbursed for only one of these procedures.  Sometimes it is appropriate for the PT to bill for multiple procedures – for example, if two procedures commonly done simultaneously are performed at separate and distinct times.

In this circumstance, the treating provider documents the reason for the variance in coding in the medical notes.  On the bill, the “59 modifier” is added to the end of the CPT code to indicate that the code should be paid.

Hang in there – almost done…btw there’s a good overview of the latest info on this courtesy of medical bill review company Equian here…

National average statistics (from two HSA customers I’ve been working with on this) indicate the 59 modifier should be on about 11%-15% of lines on PT bills.

Which brings me to the crux of the matter.  Some payers are seeing 59 modifiers on almost ALL BILLs.  After a lot of research, digging thru billing data, and back-and-forth with therapists and PT networks, it appears the 59 modifiers were NOT added by the therapist; they were added by a PT network company.

Further, there’s no explanation in the treatment notes for this billing practice; no evidence the affected procedures were actually performed at separate and distinct times; no indication the PT network company reviewed the treating provider’s notes prior to upcoding.  No documentation, no record, no history.

It appears that the intermediary was adding the 59 modifier as an automated system edit without reviewing the treatment notes. Without putting too fine a point on this, the systemic upcoding has resulted in higher costs for payers, along with significantly exaggerated savings as the bills show higher billed charges.

Perhaps there is a perfectly reasonable explanation for this, however I’ve not heard one to date.  And the coding experts I’ve spoken with can’t seem to come up with one either.

Let me be clear – this is specific to the use – appropriate, inappropriate, or questionable – of the 59 modifier, and only the 59 modifier. Ongoing research has not turned up other billing-related issues.

What does this mean for you?

You need to ask your billing folks to review their PT billing data to determine if:

  • You’ve been paying too much for PT

  • You have made decisions on PT vendors based on inaccurate information

  • Your employer clients have been billed for too much PT, and paid too much for managed care services.

How will you know if this is a problem?
Look at bills processed between 2009 and 2014 –

  • If more than 20 percent of lines on your PT bills have the 59 modifier, you MAY have a problem.
  • If more than 40 percent of the lines on your PT bills have this modifier, you DO have a problem.

What do you do if you think you’ve got a problem?

  • Ask your PT network/billing intermediary to explain, and require them to show why they are adding the modifier and how they are justifying doing this without reviewing the treating provider’s bills.

That will be a very interesting conversation…

Jan
29

Indiana expands Medicaid

Posted by Joe Paduda on Thursday, January 29th, 2015 | Comments

A remarkable experiment is about to begin in Indiana; the state will expand Medicaid, but recipients with incomes above the poverty line will have to contribute to the cost and pay something towards doctor and hospital visits.

I don’t buy the argument that this is a step onto the proverbial slippery slope, that next we know Medicaid beneficiaries will be forced to pay higher and higher deductibles and copays.

That’s as specious as the argument that states shouldn’t expand Medicaid because some day in the non-defined future the feds will pull the funding.

Nope, it is high time beneficiaries had some skin in the game.  Heck, I’d even go for giving the lower-income recipients a cash account they can use for similar deductibles and copays, with any balance at the end of the year going into a fund for education, child care, food, whatever.

Indiana follows in the footsteps of Iowa; several other states are looking into a similar program.  This is exactly what we need, states trying different things, seeing what works and what doesn’t.  We’ve learned a lot from Massachusetts – the state’s Connector plan has produced remarkably positive results.

Here’s hoping IN, IA and the other experimenting states learn a lot, and learn it quickly.

 

 

Jan
28

NOT taking risks is what’s risky

Posted by Joe Paduda on Wednesday, January 28th, 2015 | Comments

I’m talking about marketing here folks, and not the typical work comp service marketing, which is not much more than a big party at NWCDC &/or RIMS plus some folks doing RFP responses and the (very) occasional website re-do.

Nope – real marketing – creative brand promotion that dramatically raises awareness.  Campaigns that make the market sit up and take notice. Smacking them in their eyeballs with innovative, aggressive, creative messaging.

When was the last time you saw really good marketing in this boooooring business of ours?  Stuff like the Newcastle campaign?  Campaigns like Kinaxis‘ that produce brilliantly simple and quite funny brand messages for pretty dry products?

(This video on implementation as a differentiator is hysterical)

Or Microsoft’s Camp Network? (I can already see execs cringing over the “nobody eat the berries” bit…)

Not taking risks is what’s risky.  Staid, boring, yawn-inducing plain-vanilla stuff is, well, safe – if you define “safe” as no one will ever pay attention to it, so you won’t get fired.

It also won’t get you any results.

What gets results is risky, aggressive, out-there marketing.  If it doesn’t make the denizens of the C-suite at least a little nervous, its probably not worth doing.  Because it can be holy-smokes-effective, as in millions of impressions and millions in new revenue.

Let’s be clear – we aren’t talking “risky” as in “stupid”.  Not offensive, but rather “we think this works but it may not”; “this is a big departure from stuff we’ve done in the past”; “no one else in our niche has ever done anything like this”. To break through, you have to take that risk. In a world of grey and greyblue, bright orange will stand out and grab the viewer.

Which gets you their attention, for about a nanosecond.  Great marketing grabs and holds the viewer’s attention while communicating your message clearly and completely. 

And you can’t do that if you go immediately from orange back to your usual greyblue.

What does this mean for you?

Success favors the smart risk taker.

Jan
27

Misunderstanding “Obamacare”

Posted by Joe Paduda on Tuesday, January 27th, 2015 | Comments

There’s much confusion, conflation, and outright nonsense out there about “Obamacare” and the implications and effects thereof, most of it based on a lack of understanding, and a lot of that seemingly willful.

This was brought home in recent conversations with friends; one on the board of a local hospital here in upstate New York, another who is close friends with a brand-new neurosurgeon, a third a child psychiatrist in the South.

The general issue is simple: every problem – great, small; clinical, financial, or administrative; access-, process-, or outcome-based; that involves health insurance, health plans, governmental programs is blamed on Obamacare.

That asteroid coming within a mere 745,000 miles?  Damn Obamacare!

The Ukrainian war? Due to Obamacare!

My kid didn’t get into the elite kindergarten?  Obamacare AGAIN!

Ok, a reality check…

First, while some facilities are shutting their doors, hospitals have been closing for decades, looooong before PPACA was even dreamt of. If anything, the closure rate has declined significantly of late.  That’s because the country was seriously over-bedded, a situation which led to too many inappropriate admissions.  65% occupancy rates are not sustainable and inefficient so hospitals have to either get efficient or close.  Harsh as that is, we just can’t afford them.  Yes, that will hurt some health systems and may well lead to access issues in smaller communities.  And yes, that will lead to lower health care costs and more dollars for education, tax relief, roads and infrastructure.

More to the point, hospitals are in much worse peril in states that have not expanded Medicaid.  

Second, on balance, PPACA has been good for hospitals; many are doing better these days than they were for years.  In large part this is due to higher coverage rates among the employed as well as the expansion of Medicaid in states that weren’t so blinded by misplaced ideology that they refused the federal dollars.

Third, beyond the odd anecdote, there haven’t been any credible reports of increases in waiting times, access difficulty, or lack of care that can be attributed to PPACA.  (notably I was told this was a big problem in Florida, a puzzlement as the Sunshiners have yet to expand Medicaid).

Fourth, cost.  Health insurance premiums have gone up due to health care cost increases, not due to “Obamacare”.  From a Commonwealth Fund analysis of plans with price increases >10% (insurers are required to report reasons for the increase) :

rising cost of doctor visits, hospital stays, surgeries, tests, medications and other types of direct care were responsible for 84% of the premium hikes in the individual market and 78% in the small group market (which typically includes small-company plans and others with only a minor volume discount).

Finally, PPACA’s costs continue to come down, with the latest figures indicating it will cost $139 billion less than the previous CBO estimate.

That’s $139 billion that can be spent on education, job training, infrastructure, tax relief, pre-K…

What does this mean for you?

Don’t just repeat what you hear on talk radio.  It is likely wrong.

Jan
23

UPDATE – Friday catch up, and follow up on the Aetna-CWCS story

Posted by Joe Paduda on Friday, January 23rd, 2015 | Comments

Congratulations to Accident Fund’s Jeffrey Austin White – Jeff has been named Director of Innovation at the top-ten workers’ comp insurer.  I’m honored to consider Jeff a good friend.  He’s also one of the smartest people I know, and has two other all-too-rare abilities; he gets to the crux of knotty issues very, very quickly, and communicates really technical, complex stuff clearly and simply – so much so that we far-less-brilliant folks can actually understand it.

Kudos to Lisa Corless, AF’s Chief Administrative Officer for creating the position.  Innovation at a work comp carrier – there is hope for the industry yet!

Thanks to WorkCompWire for highlighting Liberty Mutual Research Institute’s recently released Workplace Safety Index.  The top two causes of injuries – overexertion and falls.  C’mon folks, let’s get in better shape!

Health Reform Implementation and health insurance

Great article by Steve Davis in Health Business Daily on the public health exchanges – couple key data points:

  • the average benchmark health plan premium increase this year was 0 percent.
  • this despite only a 1 percent increase in the average deductible
  • a lot more health insurers are offering plans on the Exchanges; McKinsey reports a 27% increase in available plan options and 19% bump in the number of insurers participating.

It’s about the prices, stupid!

It’s long been known that the primary reason health care costs in the US are so much higher than in other industrialized countries is that medical services prices are way higher.  The good news is there’s more price transparency now than ever.

The latest comes to us from WaPo’s Wonkblog, reporting the price of a knee replacement varies from $17k to $62k – in the same city (Dallas). Hip replacement costs in Boston show an even greater range – $18k – $74k.

What’s interesting about this report (which comes originally from the Blue Cross and Blue Shield Association) is it is based on the price PAID for the service by Blues plans.

UPDATE – after a query from sharp-eyed reader PW, I spoke with the Blues about the price v cost question. Media contact Robert Elfinger told me the dollar figures are, in fact, the Blues Claims Rate.  That is, what was PAID for the service.  The report was not clear on this as it mixed “price” and “cost” repeatedly.

For those who bitch about “narrow networks”, this is precisely why narrow network plans will become the industry standard in the near future; health insurers must identify low-cost, high-quality providers and direct their members to those providers if they are going to survive in the hyper-competitive Exchange-based health insurance marketplace.

Low cost or wide networks – pick one.

And health insurers are doing just fine, thank you.  From UBS comes a brief summary of Unitedhealth Group’s recent financials, and they look pretty darn good. Medical costs are coming in lower than projected despite a pretty nasty flu season, and membership growth has been higher than projected (in part due to narrow network products).

Aetna and the layoff at Coventry Workers’ Comp Services

Last week I wrote about Aetna’s decision to raise the company’s minimum wage to $16 an hour and the subsequent layoff of 11 workers at subsidiary CWCS’ office in Franklin, TN.

I’ve been talking (via email) with Aetna’s Communications folks in an effort to a) make sure I get the details right; b) get their side of the story; and c) find out what the future holds.  To their credit, my sense is they’ve been really trying to be helpful – however for some reason they’ve not been able to provide much information.  Of late, they’ve been radio silent. Here’s what I have so far.

First, I said there were 11 workers fired; Aetna says there were only 8.  It appears that there were indeed only 8 laid off, however sources indicate an additional 3 will be.

Second, in their internal announcement of the increase in the minimum wage, Aetna said there would be no layoffs, that these would of happened in December if we were going to do anything like that.”  I reviewed all press releases after April 2013, and didn’t see anything about CWCS layoffs.  In talking with some of the laid-off workers, they told me they had no indication a layoff was coming and couldn’t recall any communication of any kind about a layoff. I’m not sure the “communication” over a year ago about “targeted job reductions” can be counted as a notice by any reasonable standard. Via email, I asked Aetna if the CWCS layoff had been communicated, and was told:

in the fall of 2013 after we closed [on the deal to purchase] Coventry (in May), we communicated integration activities over at least three years, including targeted job reductions as business units conducted the activities. 

This is obviously just an oversight; CWCS is a tiny part of Aetna, and on balance Aetna is clearly doing the right thing for the vast majority of its lower-paid workers.  For several thousand employees, the wage increase is a very big deal and one Aetna should be lauded for.

CWCS is a slightly different matter.  Clearly Aetna is looking to unload the division; equally clearly (at least to me) unless they accept a very low price, that’s not going to happen. While things play out, CWCS management is doing the cash-cow thing; slashing costs and outsourcing whatever they can in an effort to maximize profits.  I get it; it makes sense from a business perspective.  However, one would hope that CWCS would follow mother Aetna’s kinder and gentler employee relations philosophy.

Note – I informed my Aetna contact I’d be posting about this today and asked three questions about possible future layoffs and any efforts to help laid-off workers find other jobs; as of now they’ve not responded.  Fortunately, after reading the post, two area employers got in touch with some of the laid-off workers as they have open positions.