Jul
12

Workers’ comp drugs – its NOT about the cost

The reaction to yesterday’s news that pharmacy costs have dropped by over a billion dollars was a bit disappointing – and missed the key takeaway.

That is – we’ve made a ton of progress, and we still have a long way to go.

Instead, some asked “where are the savings going?”, claiming employers and patients aren’t benefiting from the reduced cost.

A Kansas legislator was among those positing that question; perhaps he was unaware that Kansas employer’s premiums dropped 7.6% this year. Kansas’ results mirrored the nation’s and other states:

Of course, there are many other reasons rates and premiums are dropping across the board:

  • a nine-year long economic expansion;
  • a solid job market;
  • continued decline in claim frequency and anecdotal reports of a drop in total claim counts;
  • better control of medical costs; and
  • lots of capacity in the insurance market

are the most significant contributors.

Another critic complained that “the savings are going into insurers’ pockets.” There is some truth to that, as workers’ comp insurer profits remain at near-record levels despite the continued decrease in premiums.

(Re increased benefits for patients, that is a state regulatory issue as indemnity benefits are almost all driven by a formula involving cost-of-living benchmarks)

But the key point is this – work comp has done great work eliminating opioids – and that is wonderful news by any standard.

As CompPharma’s report details, a key driver of the drop in drug costs is lower opioid utilization. That is very good news indeed; fewer patients are getting opioids, and other reports indicate dosages and treatment duration are declining as well. Moreover, the drop in opioid usage in work comp is far greater than the overall decline in drug spend, indicating we are doing a far better job than the rest of the insurance world despite the difficulties inherent in managing drug utilization in comp (no economic levers to influence consumer behavior, few states with pharmacy network direction, widely varying regulatory environments).

For fifteen years I’ve been interviewing the people most responsible for addressing the opioid crisis in work comp. While costs are important, without exception these professionals see their job as improving patient care, reducing the risks and dangers inherent in opioid prescribing, and helping patients recover quickly.

Their relentless focus is leading to healthier patients and lower costs for employers.

We have a very long way to go. While lots of work from lots of people has helped dramatically reduce the initial (or even more problematic second) opioid script, the much tougher challenge is helping long-term opioid patients reduce and end their use of the drug.

Some payers are making solid progress; you can hear from four of them at IAIABC’s annual meeting this fall. I’ll be moderating an intensive review of how these payers are successfully helping patients reduce opioid consumption and get back to being themselves.

What does this mean for you?

Congratulations on making major differences in many patients’ lives. Now the hard work begins. 

 

 

 


Jul
11

A billion dollars and better care

Work comp drug costs have dropped by over a billion dollars over the last eight years.

What’s even better news is this has been driven largely by sharply lower opioid utilization.

The bad news is there are still far too many patients suffering from Opioid Abuse Disorder brought on by massive overprescription of opioids.

Across all 29 workers’ comp payers surveyed by CompPharma, drug costs dropped almost 10 percent last year compared to 2016. (Total US drug costs decreased last year by 2.1 percent)

The results come from our annual Survey of Prescription Drug Management in Workers’ Comp, a project now in its fifteenth year.

Payers cited clinical programs as the primary driver of lower opioid and total drug spend. A key takeaway come from payers’ views of formularies:

many respondents did NOT want to abandon their internal formularies in favor of a one-size-fits-all blanket formulary. These payers noted patients are all different, their needs evolve throughout the course of treatment and recovery, and therefore their pharmacy needs would change as well. While they were in favor of managed (state-mandated) formularies for initial fills, they want flexibility to adapt to the patient’s condition and needs without putting undue burden on the prescriber and pharmacy to comply with prior authorization requirements.

The public version of the Survey Report is available here for download; respondents received a more detailed version of the Report.

As the author of the Survey, I’d be remiss if I didn’t thank the respondents who have provided data and their views and opinions over the last 15 years. Their willingness to share their insights and perspectives has gone a long way to helping improve patient care.

I’d also note that work comp Pharmacy Benefit Managers have been largely responsible for reducing employer’s drug costs and opioid overuse. Another way to put this – PBMs have dramatically reduced their revenues by improving their customers’ and patients results.

 


Jun
27

The trade “war” and workers’ comp

Responding to the European Union’s new import tariffs, Harley Davidson will be shifting some production from American factories to its plants in Brazil, India, and Thailand in an effort to keep it’s bikes affordable.

A store in Paris

Motorcycles aren’t the only US product suffering from the not-quite-yet-a-trade war. Orange juice, cranberry juice, peanut butter, bourbon, tobacco products, steel, jeans, and playing cards are among those that are incurring at least 25% import duties.

Farmers and those in the “food chain” may be the next to feel the pain. In response to Trump’s tariffs, Beijing has said that it will retaliate by imposing duties of fifteen per cent on a wide range of American foodstuffs, According to the New Yorker the products affected include: “soybeans, cashews, almonds, apricots, strawberries, and other fruits. Pork products, which are very popular in China, would be hit with a tariff of twenty-five per cent.”

Harley-Davidson’s move was driven by the European Union’s increase of import duties, aka tariffs by 25%. This was in response to President Trump’s higher import duties on certain EU products.  With the new EU tariff raising prices by an average of $2200 per bike, HD management is now eating the losses in order to keep market share in Europe until the company can ramp up production overseas; this quote from HD is from The New Yorker:

“Increasing international production to alleviate the EU tariff burden is not the company’s preference, but represents the only sustainable option to make its motorcycles accessible to customers in the EU and maintain a viable business in Europe,”

Farm products have already been hit by trade war fears; corn and soybean futures are at a two-year low. While there’s a lot driving those prices, the short-term outlook for farmers, wholesalers, farm-equipment manufacturers and others in the ag value chain are not good.

China buys over $20 billion of US agricultural products every year, and is moving to buy more from Brazil and other countries as US goods will be much more expensive with the import duties.

Our neighbor has 1300 acres of soybeans and corn, so this is pretty real to us.

One company that’s getting hit from both sides in this trade thing is John Deere. The company’s steel prices are up while future demand for its products – both here and overseas – is in doubt. According to one analyst,

Deere & Company could end up seeing years of depressed US agricultural sales, because it may take farming households years to recover financially.

So, what does this have to do with workers’ comp?

Insurers and employers are enjoying the latest in a string of really, really good years. 2017’s combined ratio was a stellar 89, the best result we’ve seen in two decades. While premiums were down marginally last year, the pre-tax operating margin hit 23 percent, a level we haven’t seen in recent memory.

All this really really good news has been driven by a nine-year long recovery, a continuation in the structural decrease in claim frequency (and likely total claims), and relatively low medical inflation.

The very strong labor market helps a lot; re-employing injured workers is a lot easier when there are lots of job openings and employers work really hard to get injured workers back on the job to meet demand.

One would do well to remember what happens when good things come to an end. Claims jump up, possibly driven by workers scared of layoffs deciding to report that nagging pain. Employers stop hiring, afraid to be stuck with lots of idle workers when demand drops off.

If the current trade conflict gets any more heated, we’re headed for a nasty trade war, one that will have deep and lasting effects on every sector from steel to transport to agriculture to tourism.

What does this mean for you?

Trade wars will hurt the economy and hammer workers’ comp insurers. Companies serving the claims sector may well see an uptick as claim frequency and claim duration increase.

 

 


Jun
21

Why we’re not solving opioid addiction

The reason opioid abuse disorder (OAD) is such a huge problem is because no one’s figured out how to a) fix it while b) making a shipload of money.

Sure, there are “solutions” that address bits and pieces including:

  • urine drug testing identifies patients who aren’t taking prescribed drugs and/or are taking other licit or illicit medications;
  • Medication Assisted Therapy (MAT) can and does help many wean off opioids without going thru withdrawal;
  • inpatient or outpatient detox is essential for some OAD patients;
  • physical therapy and exercise is helpful for many; and
  • cognitive behavioral therapy (CBT) is essential for many patients.

But many patients require many of these services, while some do fine with one or two.

There is no single silver bullet.

What we aren’t doing is funding community-based treatment facilities and providers. This is essential because OAD is a long-term chronic disease, and patients need follow up and support for years.

The real issue is three-fold – treating OAD usually requires dealing with the patient’s chronic pain as well; OAD is a lifetime disorder; and every patient is different.

The terror of withdrawal coupled with the dread of chronic pain is hugely difficult to overcome. Patients are justifiably terrified of both, and this fear must be addressed throughout the treatment process. This is a long-term process likely involving different treatment modalities delivered by diverse providers.

Some patients respond to MAT, others do not. Some have family support systems, others are pretty much on their own. Some respond to PT and exercise, others are too afraid the effort will trigger a resurgence of pain. And the only way to find out what works for Patient X is to keep trying different approaches, providers, modalities until you find something that works.

No one has cracked the code, come up with a set process, solution or approach that works for most patients. Until someone figures out how to make gazillions fixing people with substance abuse disorder, I don’t expect the nation will make real progress.

That does NOT mean there aren’t real successes happening every day.

California’s State Fund is one of the leaders, delivering remarkable results through a careful, methodical approach.

Here’s the key – OAD can be a lifetime issue. Do not fear this, rather accept it as reality. It’s far easier to throw one’s hands up at the difficulty of it all rather than dig in and get going, but it’s also what led to hundreds of thousands of workers comp patients with OAD.

What does this mean for you?

Those who are in it for the long haul are going to be the difference makers.


Jun
6

What do these acquisitions mean?

Two just-announced acquisitions are an indicator of where things are in today’s work comp services world.

Tech firm Mitchell (recently bought by Stone Point (!) thanks for correcting me JT!) will acquire IME and peer review firm MCN.  Based in Seattle, privately-held MCN is one of the larger independent firms in that space, has a national network of 13,000 physician reviewers and a solid customer list. Brian Grant MD founded the company 30+ years ago and built it into a firm serving the auto, comp, and disability insurance industries.

This deal adds depth to Mitchell’s already-extensive utilization review/peer review offering, and adds cross-selling opportunities that should help the company compete with Examworks.

Strategically, the acquisition both broadens Mitchell’s non-bill review business and strengthens its offerings outside the auto casualty space, changes that lessen Mitchell’s reliance on auto and work comp review.  Given the long-term uncertainty about those businesses, the transaction makes sense – especially if the company focuses on disability, a space not subject to the impact of autonomous vehicles and the structural decline in work comp claim frequency.

One source indicates the price was in the 12x earnings range; that could not be independently verified.

In an unrelated transaction, TPA SUNZ bought case management firm Ascential Care in a deal announced on WorkCompWire this morning.  SUNZ sells high-deductible work comp plans to professional employer organizations (PEOs), staffing companies and larger employers.

I’d expect Ascential’s case management to be more tightly integrated with SUNZ’ claims management processes. Employers with loss-sensitive plans almost always buy into proactive, rapid use of clinical staff when claims arise. Getting case managers involved – when appropriate – can avoid problems and help patients feel like their employer is working to help them recover.

Ascential CEO Rich Leonardo is staying on and will continue to lead the business and SUNZ is investing in more staff to meet client needs.

Takeaway

For the umpteenth time time, workers’ comp is a very mature industry (as is auto).  Service companies looking to grow have to either:

  • take share from competitors;
  • buy other, similar businesses;
  • buy related businesses; or
  • expand into other markets.

Mitchell is growing by acquisition, adding more depth to its current medical management operation.  SUNZ is capturing more of the services delivered to current customers, thereby keeping those dollars inhouse.

What does this mean for you?

If you want to grow, see above. If that’s going to be hard to do, think about who may want to buy you.


Jun
5

BWC Ohio picks a new Pharmacy Benefit Manager

Several weeks ago Ohio’s state work comp fund – the Bureau of Workers’ Compensation – selected a new PBM to replace OptumRx.

This has me thinking more broadly about the vendor-customer relationship and how that’s evolving.

First, buyers are getting smarter. BWC’s former and current pharmacy directors (John Hanna and Nicholas Trego respectively) are not just pharmacists, they have become expert in pricing, auditing PBM transactions, understanding contracting language, and negotiations.

According to WorkCompCentral’s William Rabb, BWC learned it was paying OptumRx millions more than it should have after conducting an audit earlier this year.  Quoting Rabb:

an audit showed that the current PBM, OptumRx, failed to keep drug prices below the maximum allowable cost as required.

The audit is here.

Without getting too deep in the weeds here, allegedly OptumRx was supposed to keep generic drug prices at or below a Maximum Allowable Cost, or MAC. However, the audit indicated OptumRx failed to do that, resulting in BWC paying about $5.7 million more for generics than it should have.

Seems straightforward, but this can be hard to figure out as the list of drugs subject to MAC list pricing is often not disclosed.  That is, the PBM has a “proprietary” MAC list which it does NOT have to share with its customer.

Obviously this makes it hard for the customer to figure out if it is paying what it should.

Second, major issues don’t just pop up out of thin air; its unlikely BWC first expressed concerns a few months ago.

Moving an $84 million pharmacy program – or any big service – is no easy task; there’s a ton of systems programming to be done and tested; patients to be switched from one PBM to the new one; adjusters and case managers to train; financial arrangements to be agreed upon; pharmacies and employers to educate; and myriad other tasks.

Payers do NOT make changes unless they have no other choice due to the switching cost, potential business and patient care disruption, and internal stress involved in moving to a new PBM (or any other service type).

Service providers need to ensure that their senior managers and front-line staff understand their customer’s situation, concerns, needs, and plans.  Equally important, senior management must empower their client-facing staff, giving those staff the ability to fix problems, highlight issues, and marshal resources needed to meet clients’ needs. (I’d note that Optum’s work comp PBM recently brought Kaye Lewis back on board to run account management; Kaye is universally well-regarded and one of the best in the business; I had mistakenly said Kaye was working with OptumRx which focuses on the broader health marketplace. I regret the error. )

Third, vendors need to own up to and deliver on their commitments to all involved.  Quibbling over contractual terms, arguing over this clause or that, or word-stretching to avoid doing what the customer or the customer’s advocates need done reflects short-term, myopic thinking.

Sure, you may be “right”, but you’ll win that battle and lose the war.

What does this mean for you?

These days customers are harder and harder to come by, so when you get one, make darn sure you keep them. Listen, anticipate, deliver, and be flexible.

And most of all, meet their needs.


May
31

Thursday catch-up

Lots going on out there – here’s what you may have missed…

Opioids

The awful people at Purdue Pharma knew damn well their opioids were being misused, repeatedly denied it, and kept pushing their pills on doctors and patients. They lied to investigators, manipulated data, and are directly responsible for today’s opioid disaster. This from Barry Meier’s piece:

credit NYTimes

But the Feds aren’t blameless; in 2007 the US Justice Department allowed Purdue officials and the company to plead guilty to misdemeanor charges.

Think of that – misdemeanor charges for those most responsible for the opioid epidemic. Street corner drug dealers go to jail for years, and these fat cat execs with their lavish lifestyles and fancy lawyers pay a small fine.

I cannot put into words how much I hate these bastards, and how furious we all should be about a Justice Department that let them get away with it..

Breathe…

WCRI is hosting a webinar on the impact of opioids on disability duration on Thursday June 21 at 1pm eastern. Bogdan Savych PhD will address the following questions:

  • Do opioid prescriptions increase duration of temporary disability benefits?
  • Do longer-term opioid prescriptions increase duration of temporary disability benefits?
  • What role do local prescribing patterns play in determining whether injured workers received opioid prescriptions?

The study examines the effect of opioid prescriptions on the duration of temporary disability benefits among workers with work-related low back injuries using data from 28 states, for injuries between 2008 and 2013.

Register here…free for WCRI members, a nominal fee for others.

If you’re wondering why Congress isn’t doing more to attack the opioid crisis – and it isn’t doing much at all – blame the lobbyists, including those working for the AMA, the seventh highest lobbying spender in 2017, with $21.5 million spent.

The AMA is fighting 3-day opioid script limits, mandatory use of Prescription Drug Monitoring Programs, and mandatory opioid education for prescribers.

WTF??!!!

Twisting words to blame the victim

Poor people are less healthy than people who aren’t poor. That’s because their diets aren’t as good, they have poor access to care, their lives are far more stressful, substance abuse is more prevalent, and they are more often victims of crime.

These factors have long been known as “social determinants of health”, the idea that just being poor means moms, kids, dads are going to be less healthy than you and me.

The “work for Medicaid” crowd is attempting to steal the term “social determinants” by using it to claim that forcing people to work for Medicaid is good for them.

That’s just not true. In fact, forcing Medicaid recipients to go thru a maze of paperwork and administrative hurdles to prove they can’t work  – and if that recipient messes up the paperwork, fails to submit it on time, or isn’t able to accurately document their disability,

BOOM! they lose Medicaid coverage.

And they get sicker, and we end up paying for their care in the ER.

And the data shows folks who HAVE Medicaid are better able to find work! From the HealthAffairs piece:

illness and disability are among the primary reasons working-age adults are not employed and this problem is exacerbated when people lack access to the health coverage they need get care for their health problems. Enrollment in health coverage has been shown to be a significant factor in helping individuals find jobs, with over 75 percent of unemployed Medicaid enrollees in Ohio reporting that gaining access to health coverage made their job search easier.

Oh, and at least one state’s policies is blatantly racist.

There’s more, but I have to get to work.

 


May
30

King v CompPartners and the Duty of Care

To what extent are utilization reviewers care providers?

That was NOT the central question argued yesterday in the King v CompPartners case before the California Supreme Court.

The case appears straightforward; the plaintiff was prescribed Kolonopin, which was denied after going through the UR and IMR process. When he stopped taking the drug, he suffered several grand mal seizures which led to additional injury. The plaintiffs are arguing the UR physician who wrote the final denial should have authorized or otherwise recommended a gradual withdrawal, as seizures are not uncommon when patients suddenly stop taking Klonopin (Mr King had been taking it for two years).  In the view of the plaintiffs, failing to do that amounted to medical malpractice .

The central legal issue in this case is the exclusive remedy nature of workers’ comp, with the defendant arguing that he cannot be charged with malpractice as the UR determination and related processes took place within the workers’ comp system. While that’s the central issue, it’s not my focus.

Rather, I’m interested in the “duty of care” issue. I’ll leave the exclusive remedy issue to the lawyers; the health of the patient – and who is responsible for that – is what’s important to me.

There’s some pertinent case law in California that speaks to the “duty of care”, a phrase that infers the physician doing the review  is responsible  – to some degree – for the medical treatment and results thereof associated with his/her UR determination. In fact, the first court ruling verified that the UR physician owed the patient a duty of care.

The question seems to be, how broad and deep was the duty owed the patient?

The case went to appeal, and the court asserted that the UR physician did have a duty of care. From my reading, it based that assertion on the court’s view that a UR physician is implicitly acting as a medical provider.

However – and this is where it gets sticky – the duty of care varies depending on the patient’s specific situation.  

There’s a legal and an ethical issue here. First, that “standard” is pretty nebulous, ripe for disagreement and litigation.

Ethically it’s more clear. The UR entity should always consider the implications of its decision, the potential negative health consequences, as well as the narrower workers’ comp medical considerations of relatedness, appropriateness, and causation.

Because at the end of the day, it’s about doing the right thing for the patient.

Here’s where the reality that is California’s work comp screws things up; payers often base their decisions on which UR vendor to use largely on price.  UR is seen as a commodity, a necessary evil, especially in California where medical management costs account for way too much of the claims dollar.

Payers are looking to get the cheapest UR they can, while some providers and their legal/lobbying supporters scream about high administrative expenses, inferring those dollars should be spent on patients.

What does this mean for you?

What patients need is careful, thorough UR by physicians with the time and training to foresee and speak to potential consequences of their determinations. And that costs money.

Both payers and their adversaries would be well served to acknowledge that fact.

Note – I haven’t read the UR/IMR determination itself, so I don’t know if or to what degree the UR physician delved into the Klonopin withdrawal issue, nor do I know if that was discussed with the treating physician.

Rather my perspective is how these things should be handled and what the primary consideration should be.

 

 


May
23

Hartwig on the economy and workers’ comp

Dr Bob Hartwig of the University of South Carolina gave his annual whirlwind tour of all things economic. The net – his talk was an exuberant paean to the US economy – and the impact of that economy on workers comp.

My view –

  • the data doesn’t indicate the economy has noticeably strengthened over the last year or so;
  • consumer and small business confidence levels are notoriously fickle; and
  • there are lots of warning signs out there that merit close attention; warning signs that weren’t adequately addressed in the talk.

While he briefly noted several potential issues with the economy, overall Bob painted a picture of businesses investing, consumers spending, profits abounding, and sunshine and happiness all around.

I’m not so sure.

For example, he cited as one reason for the nation’s positivity this datapoint; GDP growth was north of 3 percent for two quarters last year. Well, that’s true. However…

He chose two quarters where growth was over 3 percent – but in reality annual growth was 2.6% last year.

And 2.3 percent for the first quarter of 2018.

And last year’s 2 quarters paled in comparison to the 3.5 percent growth in 4 out of 5 quarters we saw in 2013-2014.

A 2.6 percent annual increase is solid, but by no means a boom.  Bob did cite the high consumer confidence index, small business confidence, and a variety of other factors as support for his overall very positive outlook.

While people may be “confident”, confidence is a state of mind that can change really quickly…and there are dark clouds on the horizon.

For example – wages remain low; consumer debt levels are at historic highs (26% of earnings); the Federal debt and deficit is going to soar, driving up interest rates; and there’s a real risk of trade wars.

If consumers feel strapped and stop buying, things will get ugly. Given the record levels of consumer debt, I don’t see how the buying surge can keep going unless wages increase and interest rates stay low – which isn’t happening.

Bob briefly noted the issue of wage stagnation, but did not discuss the impact of this – and the fact that this is a chronic problem for consumers and businesses. In fact, the financial gains are not going to workers, but to investors and owners…who are less likely to use their newly-gotten tax gains and profits to buy pickups and groceries and movie tickets.

He talked about job openings, specifically the 6 million job openings today – perhaps those jobs are open because employers aren’t willing to pay enough to get people who have left the workforce back in the job market.

He did address the the long-term unemployed, sort of.  Hartwig stated that the number of folks not looking for work is not going to change due to a number of factors (citing the U-6 unemployment rate, which includes those not actively looking for work – slide 17).

Got to admit this was confusing… the overall labor force participation rate, which has been pretty flat since 2014, was often cited by Obama critics as proof that the “recovery” was no recovery at all.  Now we hear that the unemployment rate – which is the inverse of the labor force participation rate – isn’t likely to change. [I emailed Dr Hartwig Monday asking for clarification; haven’t heard back yet but will update the post if I do]

Well, which one is it – will people return to the workforce or not?

Here’s a detailed discussion of labor force participation rates; note that the rate today is exactly what it was in January 2017 – 62.9%. And here’s why labor force participation is viewed as a better measure than unemployment.  Here too.

Clouds on the horizon

Hartwig did note a few potential issues…

  • the possibility of trade wars affecting employment; those industries most at risk – aircraft, electrical equipment, fabricated metals are among the top potential victims,
  • infrastructure improvements likely won’t have much of an effect.
  • the pending huge increase in the Federal debt  – Bob said that interest rates “may” have to increase.

May???

Not only will interest rates go up (for businesses and the Feds), but a much larger percentage of Federal spending will go to debt service. In fact, we can expect the Fed to increase rates this year.

What does this mean for you?

The data points cited by Dr Hartwig don’t indicate the economy has strengthened appreciably over the last 18 months. Yes, consumer and small business confidence indicators are strong, but they appear to be based not on real economic conditions but on emotion.

Emotions can change fast.


May
22

Swedlow on work comp networks…they are NOT equal

The best was saved for last at NCCI’s Annual Issues Symposium. After Gen (ret) Colin Powell warmed up the crowd, NCCI’s Barry Lipton and CWCI’s Alex Swedlow took to the stage to educate us on networks and outcomes.

First, California. Average medical costs have gone up 4.3x in CA since 1990; while there have been lots of regulatory and legislative efforts to add guidelines, enable managed care, and increase network usage, ultimate medical costs now are over $37k.

Network penetration in CA is now around 84% for physician services – where it looks like it has peaked.  Along with this increase has come an increase in administrative expenses.  WC Admin expense in CA now accounts for 53% of work comp costs, more than twice the average across the nation.

41% of those costs are for med management (31% for defense attorney expense). Bill review and network account for 47% of those medical management costs, UR is the remainder. (these percentages have been pretty static over the last decade).

So, what are you getting for all your millions?

Fortunately, CWCI’s done a lot of work to evaluate that very question. And they dug really deep. The slide below describes the data points CWCI used in their network evaluation.

Swedlow et al then looked at individual networks, comparing 11 different networks’ outcomes for claims (case mix adjusted, incurred between 2011-2014, developed thru 2017). Lots of takeways that will be published in a few weeks after final editing.

But here’s a spoiler –

There’s a huge amount of variation between networks, and some are delivering excellent results while others are worse than no network at all.   I direct your attention to the right side of the picture; note that average case-mix-adjusted cost per claim varied by 82 percent.

If you used the MPNs on the left side of the graph, your medical loss costs per claim would be over $11,000 lower than if you used the MPNs on the right.

And, your patients would get back to work two months earlier.

My takeaway is this – there are two types of MPNs; the State Fund and Kaiser Permanente On-The-Job type that is outcome-based, highly selective, and focused on care. This Outcome-based MPN, Or O-MPN is on the left of the screen.

And the revenue-based, that are focused on generating dollars off savings below fee schedule and other meaningless standards. On the right of the screen, the revenue-based MPN, or R-MPN, is huge, includes every provider in the book and some who haven’t been in the book for some time, is completely unmanaged, and generates beaucoup bucks for the payers that use it.

Lots of other great insights in the session which I missed – I had to run to get to the airport.

What does this mean for you?

Depends…Is your MPN an R-MPN or an O-MPN?