Insight, analysis & opinion from Joe Paduda

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May
21

Risk Managers and work comp outcomes

Walt Disney, Darden, and Publix’ risk managers gave their views on a variety of topics at last week’s NCCI AIS – including provider networks and outcomes.

Walt Disney direct contracts with providers, evaluates outcomes, and monitors those providers on an ongoing basis. The company also administers its own claims, has its own medical management staff, and tightly coordinates with it’s PBM – myMatrixx/Express Scripts.

Got to say, I’m pretty impressed with this approach, the depth of understanding of real costs drivers it shows, and the investment made by Disney.  Kudos to Risk Management VP Michele Adams and her colleagues.

That said, Disney has a major advantage over other employers – tens of thousands of workers located in one place equals huge buying power. I heard from several risk managers at the break that Disney’s situation is unique and one that doesn’t really apply to them.

My take – there is ALWAYS something you can learn from well-run programs. Instead of focusing on what you can’t do, focus on how you can adopt principles of successful programs in your situation. For example, buying power is a function of dollars per provider; the fewer dollars you have, the fewer providers you need.

Allocate your dollars to a few providers and you will get their attention. And yes, you can soft channel in so-called “non-direction” states.

Publix’ Marc Salm reported that his workers sometimes complain about specific providers they use, and those providers are often the ones with poorer outcomes.  Salm also seemed to infer that most large employers are focused on outcomes, and select providers based in large part on that criterion.

Marc may talk with different folks than I do; suffice it to say I haven’t encountered more than a handful of large employers that are engaged to any measurable degree in provider selection or network evaluation, much less outcomes.

My sense is this is the primary reason outcomes-based networks haven’t taken off; there just isn’t the demand.

That said, there are several companies – Albertsons’ being one – that rely on Kaiser Permanente On-the-Job (KPOJ) for all or a large chunk occupational care.  They’ve made the decision to work exclusively with KPOJ because the care model works, the providers’ incentives are appropriate, and most importantly, the outcomes are superior. So, perhaps Marc and I are talking with the same folks – at least in California.

Darden outsources network selection and pretty much all managed care functions to its claim administrator.

 


Joe Paduda is the principal of Health Strategy Associates

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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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