[see update below]
Now that the Supreme Court has handed down the final word on the PPACA, we can stop speculating and start thinking thru how it will effect workers comp.
Overall, this is good news. That may not sit well with those ideologically opposed to reform, but here’s why.
The most important single impact is this – When injured workers have coverage, there is no need for WC to pay for non-occ conditions for injured claimants (whether the WC payer follows thru on this is a separate issue).
This is also the most significant short term impact, especially in states such as Texas and Florida where almost one in four working age people doesn’t have health insurance. Think of it this way – a claimant needs surgery for a rotator cuff tear, has diabetes and hypertension. If they don’t have coverage, the work comp payer will pay to treat the diabetes and hypertension – those conditions have to be addressed if the claimant is going to recover and get back to work. Now the comp carrier can send those bills over to the health insurer.
And, the adjuster, case manager and UR function won’t have to engage in the back-and-forth with the provider over treatment, delaying treatment and extending disability duration.
There are a plethora of other ways PPACA will impact work comp – here’s a summary
1. There will be somewhere around 24 – 28 million more Americans with health insurance; thus there will be a lotless need for hospitals and other providers to cost shift to work comp to make up for revenues lost due to treating the uninsured. Sure, Medicaid reimbursemt is lousy and Medicare only a bit better but something’s a lot better than nothing.
2. Possibly higher claims frequency, although this is based on assumptions and interpretations. The data indicate those workers with health insurance are more likely to file comp claims than those without, but that appears to be a statistical relationship and not a causal one. Employers who provide insurance have better employee relationships, which appears to make employees less afraid to file WC claims.
3. For the big managed care companies, continuation of a much stronger and tighter focus on managing individual and group health, Medicaid and Medicare will mean less interest in, and resources dedicated to comp. Make no mistake, this is an event for which the big and small health plans were woefully unprepared. Many have been scrambling to adapt, investing in technology, getting bigger via acquisition, and strengthening relationships with providers.
Coventry and Anthem are the large players most invested in comp; they appear to have different strategies and approaches which we’ll explore in a future post.
4. Healthier claimants – those with insurance are healthier than those without, and healthier claimants heal faster and don’t need as much treatment.
5. More science and less art in the practice of medicine as comparative effectiveness research gains traction – good news indeed for comp payers saddled with back surgeries and H-Wave devices.
While some states may decide to not accept funding for the expansion of Medicaid, on balance this won’t be a negative – any additional coverage is a net positive for comp.
UPDATE – A colleague reminded me (after I posted this today) of the access issue – and he is correct. There will (very) likely be an access problem over the near term as primary care providers are inundated with new patients, and over the medium term for specilaists as folks who’ve long avoided care because they could not afford it now get those problems resolved – knee replacements, etc. My colleague’s reminder is well worth considering, and payers would be well-advised to develop strategies to strengthen relationships with primary care – and specialist providers. WC primary care is best delivered by occ med docs, so this may also encourage payers and employers to direct their claimants to docs better equipped to deal with those patients.
What does this mean for you?
Healthier claimants, less cost-shifting, more science, and possibly slightly higher frequency – on balance, good news indeed for workers’ comp.
For those who are interested, I have a rather detailed presentation on this issue; send an email to infoAThealthstrategyassocDOTcom and we’ll get it out to you next week.
[see update below]