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2014’s predictions; how’d I do?

Before jumping into my predictions for 2015, I thought it would be helpful to review my previous prognostications.  Here’s how I did, color-coded for your grading ease:

1. Overall, the work comp insurance market will be steady. 

Yep; rates were up just slightly, coverage availability is fine, and there are no crises.  Then again, this wasn’t a very risky “prediction”.

2.  More consolidation in the TPA market is on the horizon.

True againYork acquired Bickmore, American Claims Services, MCMC and CareWorks. Sedgwick bought Absentys and VeriClaim. However, GB, Broadspire, ACE stood pat.

What’s notable about these transactions is most do NOT involve buying another TPA, but rather complementary services.  Non-core services may be more profitable and offer more growth potential over the near term…

3.  Medical trend – on a paid, not incurred basis – will increase by at least a couple of points.

Trend on an incurred accident year basis was up 3 points; this is not paid as I’m having a heckuva time finding paid data.  Anyone?  Till then, I’ll leave this as a TBD.

4.  Deal activity for mid-sized to large transactions in the work comp services sector will taper off.

Well...not correct.  Xerox-ISG, PMSI-Progressive Medical, APAX-Genex, Onex’ purchase of York, Hellman Friedman’s sale of Sedgwick to KKR…

5.  At least one – and likely more – insurers will discover the real impact of opioids on their claims costs, and the impact will affect their reserves, rating, and/or financial stability.

If they did, they haven’t published it, so that’s a no.

6. Aetna will not sell its work comp business.

True.  And I don’t think it will.

7.  Someone is going to buy Stratacare.

True again.  I thought it might be Mitchell, but KKR was the winning bidder.

8.  Frequency will level off – somewhat.

This is a “no” as well – lost time claim frequency declined slightly – by about 2 points according to NCCI.

9.  Guidelines are going to get a lot more attention – and more regulatory support.

Most certainly – and most welcome. A quick scan identified new or updated guidelines in multiple states: opioid guidelines from Oregon and California; various treatments and body parts addressed by Colorado; non-acute pain in NY; scheduled drugs in OK; chronic pain, TBI, and CPRS in Montana and I’m sure there are lots more.

10.  The train wreck that is senior management at the North Dakota State Fund will continue to demonstrate the perils of politically-driven leadership.

Alas, yes.  With the resignation of well-regarded Medical Director Dr. Luis Vilella this summer after too much meddling by his nominal superiors, the ongoing leadership deficit has damaged the state fund’s IT, management, and now medical functions.

So, six correct, three wrong, and one TBD.


3 thoughts on “2014’s predictions; how’d I do?”

  1. A great prediction and nice thinking sir Joseph. Seems your points will work too. waiting for the best. And yes ! Thanks for sharing your thoughts !

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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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