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UPDATE – Ethics in workers comp managed care

For the update, see UPDATE below.
Also, if you would like a copy of Todd’s marketing presentation, email me at infoAThealthstrategyassocDOTcom. The presentation is not copyrighted, marked confidential or proprietary, or otherwise protected from distribution.
Original post
The world of work comp managed care is highly competitive, with vendors willing to push pretty hard to win business or hold on to customers. That’s the way the market is, and as long as these practices don’t cross the line, may the better competitor win.
But sometimes that line is crossed.
A work comp PBM took my copyrighted work and without my permission, used it in a marketing presentation. They also copied my Survey of Prescription Benefit Management in Workers’ Comp and distributed it without my permission.
Not only that, but the PBM mischaracterized the work in such a way that it appeared I endorsed their approach and business model, if not them specifically.
I’ve repeatedly asked the PBM to retract their statements and have yet to receive confirmation that they did so. Rather than continue to spend money on attorneys, I’ve decided to publicly disavow any connection between myself, my firm Health Strategy Associates, LLC, and the WC PBM consortium I work with, CompPharma, LLC, and the PBM in question – one WorkComp Rx, Inc, and WCRx’ President, Greg Todd. Todd is also affiliated with Integrated Prescription Solutions.
Here are a couple specifics.
The introductory slide in a WorkComp Rx marketing presentation (entitled HSA Comparitive (sic) Summary ) states the: “findings [of my firm’s Annual Survey of PBM in WC] support WCRx’s performance Is The Best-In-Class”. No, it most definitely did not.
Another slide showed WCRx’s inability to comprehend the survey. The slide reads “Typical PBM Pharmacy network size is 55-58,000 pharmacies of which “penetration rate” is approximately 65% which totals 38,000 participating pharmacies”, showing his firm didn’t understand the definition of ‘network penetration’, which is not how many pharmacies participate but what percentage of scripts are processed thru the retail network. This led to this wildly inaccurate conclusion:

WCRx’s pharmacy network includes 99.7% of all US pharmacies (64,000+) and a 100% “participation or penetration” rate. That is more than 30,000 additional pharmacies with 100% participation than any competitor.

Yet another slide stated that the Survey found that Third Party Bills “…amounted to 40% – 50% of all W/C pharmacy bills.” Nowhere in the Survey do those words appear.
There are plenty more examples of misinterpretations, fabrications, and distortions, but you get my drift. It could be that Todd et al just don’t understand the work comp business, as his company’s website reads in part:
“Workers’ compensation is mandatory medical insurance that is paid for by employers and is required by law in every state.”
There are two errors here – WC is not mandatory in every state (i.e. Texas) and is not ‘medical insurance’.
UPDATE – IPS changed its website yesterday; the new description of work comp reads as follows:
“Workers’ compensation is a form of insurance that provides compensation medical care [sic] for employees who are injured in the course of employment, in exchange for mandatory relinquishment of the employee’s right to sue his or her employer for the tort of negligence.”
end of UPDATE
It also states that work comp medical spend is broken up thusly:
Hospitals & Physicians: $18.4 billion
Physical Medicine: $8.8 billion
Pharmacy: $6.0 billion
Diagnostic Services: $3.2 billion
DME/Home Healthcare: $3.2 billion
Cost Containment (UR): $1.8 billion
Perhaps Todd et al made these data up themselves, or have a source I’ve never heard of, or used data from one state to extrapolate to the rest of the country (no source is cited); I don’t know where else they could come up with these statistics, certainly not from NCCI or WCRI or NASI or DoL BLS reports.
When I learned of the misuse of the Survey’s findings and unauthorized duplication of the Survey itself, I immediately contacted my attorney, who sent a firm but polite letter to the PBM’s president, Greg Todd, a man heretofore unknown to me. The letter asked Mr Todd to stop using my material, inform all those he or his employees or agents had shared my material with that this was unauthorized, and tell them that I had not and did not endorse his company or approach.
Mr Todd sent a letter back telling me that I was fortunate to have his company spreading the word about me and my firm. But before he sent that letter, he called me and asked if this was about CompPharma, the consortium of workers’ comp PBMs I work with and am a part owner of. I said no, it was not; he replied that he knew other CompPharma members were using my work, whereupon I told Todd if they were it was with my permission. He then offered to join CompPharma and inquired about the fee.
He could not seem to understand that this was not about a fee. This was about his company doing something it should not have done, misusing my work and using my reputation and credibility to help him sell his stuff.
A follow up letter to Mr Todd went unanswered. As it appears that Todd is not going to respond to my request that he retract his statements and stop using my materials, I have no choice but to get the message out myself.
I am not today, have never been, and will never be affiliated with, work with, endorse or recommend WorkComp Rx, Integrated Prescription Solutions, or any other firm associated with Greg Todd. Any use by Mr Todd or anyone at either of those firms of any work product of Health Strategy Associates, LLC, CompPharma, LLC, or myself is done without my knowledge or permission.

6 thoughts on “UPDATE – Ethics in workers comp managed care”

  1. Dear Joe Paduda:
    We first met when I worked with Cypress Care. I want to applaud you for standing up for your work and for the ethical practice in the work comp industry. I agree 100% with your inital statement below:
    “The world of work comp managed care is highly competitive, with vendors willing to push pretty hard to win business or hold on to customers. That’s the way the market is, and as long as these practices don’t cross the line, may the better competitor win.
    But sometimes that line is crossed.”
    These are my personal thoughts as well.
    Thank you very much!

  2. Joe,
    Would you like us to post this to our blogs as an excerpt and link back to your blog? I think it’s a great wake up call and will help get the word out.

  3. I have a comment about Stone River Pharmacy Solutions. I had a WC case in ’05. My employer didn’t pay for the last 3 mo. of presciptions. I received an invoice dated Sept.17,2009 for scripts filled in 2005. This is the first I have heard that I owed them money. Can they do this? They are threaten to sue me. Help! I need your input on this. Thanks.

  4. Joe,
    I would take it one step further to say that they don’t understand the property casualty market at all. Further down on their website they refer to Personal Injury Protection (PIP) as Med Pay insurance when these are two separate coverages. Also they say PIP insurance market isn’t viable in every state..that is because NoFault PIP coverage isn’t the law in every state…duh…
    I applaud your setting the record straight.

  5. Joe –
    I’m not in the business, but look
    to your blog for high-quality
    information and analysis on issues
    that directly affect me.
    It’s a shame that your work has
    been plagiarized and misinterpreted
    by an ignorant, unscrupulous individual.

  6. This is what I’ve come to expect as standard business practice in the work comp PBM industry. Pathalogic lying, nothing new, there are several PBM’s out there using health networks instead of comp networks. One in particular in Tampa, which the state of Florida is getting ready to audit.

Comments are closed.

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.



© Joe Paduda 2018. We encourage links to any material on this page. Fair use excerpts of material written by Joe Paduda may be used with attribution to Joe Paduda, Managed Care Matters.

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