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Dec
21

Florida’s hospitals win big. Employers and taxpayers lose big.

Defying statutory requirements, logic, common sense, good government, fairness, basic math and the facts, Florida’s workers comp regulators just hammered the state’s employers, taxpayers, and physicians.

This is NOT yesterday’s Three Member Panel meeting, altho it bears a striking resemblance…foregone conclusion after a lot of theatrics

In a regulatory process resembling a Soviet show trial, the Three Member Panel slammed through a reimbursement scheme that will raise costs for employers and taxpayers while making sure Florida’s docs are among the lowest paid in the nation.

Allow me to list a few of the TMP’s many errors.

  1. The TMP failed to comply with the law that established the TMP, which reads in part:
    Paragraph 440.13(12)(d), F.S. further 4 states: In establishing the uniform schedule of maximum reimbursement allowances, the panel must consider: 1. The levels of reimbursement for similar treatment, care, and attendance made by other health care programs or third-party providers; [note that several organizations gave the TMP data comparing WC reimbursement to Medicare and others; the TMP ignored it] 2. The impact upon cost to employers for providing a level of reimbursement for treatment, care, and attendance which will ensure the availability of treatment, care, and attendance required by injured workers…”
    The TMP said the scheme would reduce facility costs by 23%, citing an NCCI analysis that indicated the revised hospital fees. HOWEVER, the comparison data used in the analysis was from 2019, when hospitals were able to game the system by over-charging work comp patients. After a court ruling some months ago, many payers started denying outlier payments – and that continues to this day. [edit after hearing more from NCCI]
    Thus, the comparison does NOT reflect the actual difference between current and future costs due to the TMP’s new reimbursement scheme.
  2. The TMP refused to even consider the impact of rampant price-gouging by facilities with high charges on employers and taxpayers. This is very well documented, yet somehow escaped the TMP’s consideration.
  3. An incredibly naive comment by one TMP member illustrated his total ignorance about medical costs in work comp. According to a piece authored by William Rabb in WorkCompCentral, “worker representative” Jason Robbins said that in his experience, since few workers end up in the hospital, it’s not a big deal. [Why read WCRI studies when you can just rely on your own “experience”?)
  4. The estimable Mr. Robbins also noted excess insurance protects the insurers from high costs. Of course, employers and taxpayers have to pay premiums to excess insurers, which are driven by facility costs, a reality that appears to have escaped Mr. Robbins.
  5. Then there’s the hospital lobbyist noting that the law doesn’t require reimbursement to be “reasonable”…looks like the TMP bought into HCA attorney Jennifer Hinson’s opinion on what the law says.  Attorney Hinson’s opinion is – to be kind – not supported by the actual law, which states:
    “The uniform schedule of maximum reimbursement allowances must be reasonable, must promote health care cost containment and efficiency with respect to the workers’ compensation health care delivery system…”[italics added]
  6. Even the employer “representative” on the TMP, one Tamela Perdue, also voted in favor of hospitals. Perdue is an attorney employed by Sunshine Health, a Florida health insurer owned by Centene.
    I’m a bit surprised Perdue is a) on the TMP and b) voted; there’s a potential conflict of interest here as her vote favoring hospitals could be seen as a favor to hospitals in Sunshine Health’s network.

Finally, there’s a wealth of research indicating Florida’s reimbursement of physicians is way too low.  Rather than take a stand on this, the TMP just said it wasn’t anything they could do anything about.

Leadership at its finest, no?

What does this mean for you?

This is a not-very-well-hidden tax on Florida employers and taxpayers.

[note – I asked the Dept of Workers’ Comp for comment; as of this time they did not respond]


2 thoughts on “Florida’s hospitals win big. Employers and taxpayers lose big.”

  1. How does an insurance company representative (Sunshine Health) wind up as the “Employer Representative” on the 3-member panel. Sunshine Health providers Medicare and Medicaid Plans and NOT workers comp, so I’m not even sure why Sunshine would find it worthwhile to be involved in the 3 member panel. Joe: Not sure I agree with your hypothesis that voting in favor could be seen as a favor to the hospitals in their network. I’ll have to think on that. .

    1. Hello Ann – thanks as always for your observation.

      here’s why membership on the TMP and/or favorable vote might be questionable – clearly hospitals are making a fortune off workers comp.

      You are a hospital negotiator, and across the negotiating table from you is a healthplan executive negotiating for a Medicaid contract. You know the healthplan executive supported the new facility reimbursement scheme. Your hospital greatly benefits from that new reimbursement scheme.

      Is it possible that this could affect your perspective as a negotiator on that healthplan and/or the executive?

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Joe Paduda is the principal of Health Strategy Associates

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