Category: Workers Comp

Oct
24

Finding good companies

Posted by Joe Paduda on Tuesday, October 24th, 2006 | Comments

There is quite a bit of interest among private equity and venture capital firms in the work comp managed care “space”. These investors seek to buy into companies that are poised for growth, that have a “sustainable competitive advantage”, solid management, long term contracts with customers, and a profitable business model.
A key to success for these investors is to find these firms before the other investors do, which means identifying good companies quickly. Analysts spend lots of time, energy, and brain power analyzing, assessing, and interpreting data. looking for the wheat among the chaff.
A much faster, and probably more accurate way, is to pick up the phone and call the company. Talk to the receptionist, someone in customer service and someone in billing. What they say doesn’t matter nearly as much as how they say it.
Good companies have energy, enthusiasm, and a desire to help that comes through the phone. Not so good ones have none of the above.

Oct
17

Workers’ Comp – the answer to the spinal fusion question

Posted by Joe Paduda on Tuesday, October 17th, 2006 | Comments

Kudos to USAToday for publishing a pretty good article on variations in practice patterns related to back surgeries. In a front page story today, the paper that has been derided by some as “McNews” explores the issues surrounding the explosion in the number of spinal fusions.
The reporting is balanced, insightful, and thorough, a bit of a surprise coming from a paper that prides itself on short sentences, really short words, and lots of color, not depth and nuance.
Noted throughout the article is the primary problem – no one knows how many spinal fusions are the right number, and there is significant disagreement among stakeholders re when a patient should have surgery. (free registration required) That’s all true, and that’s where workers compensation comes in.

Continue reading Workers’ Comp – the answer to the spinal fusion question

Oct
3

Washington v Ohio

Posted by Joe Paduda on Tuesday, October 3rd, 2006 | Comments

Ohio’s Bureau of Workers Comp (BWC) could take a lesson from the State of Washington’s own workers comp fund. While the two state funds have some similarities, their results are quite different.
How different? Read on…

Continue reading Washington v Ohio

Oct
2

Florida’s State CFO race

Posted by Joe Paduda on Monday, October 2nd, 2006 | Comments

Florida is one of, or perhaps the only, state to have as an official elected position a state CFO. The incumbent is supposed to oversee state spending, review state contracts and investigate insurance fraud among other functions. Florida’s CFO is also part of the four person cabinet along with the governor, attorney general, and Commission of Agriculture and Consumer Affairs.
Obviously, the CFO would have a broad and deep impact on the state’s insurance industry, the provision of same, and purchase of insurance by the state. That makes it interesting for we insurance types.

Continue reading Florida’s State CFO race

Sep
29

The feds did it

Posted by Joe Paduda on Friday, September 29th, 2006 | Comments

For readers interested in workers comp, news from Effect Measure to whet the appetites of litigators looking to subrogate workers comp claims.
It seems that the highest levels of the Federal government were intimately involved in publishing information about the safety, or lack thereof, of the air around the WTC in the days after 9/11. And by all accounts they got it wrong.
Liberty Mutual, among other workers comp insurers, was, and is, on the risk for many of the people affected by the clouds of noxious substances resulting from the Towers’ collapse. Perhaps they are already subpoena-ing away…

Sep
27

Health Advocates – was the price too high?

Posted by Joe Paduda on Wednesday, September 27th, 2006 | Comments

Medicare Set-Aside (MSA) vendor Health Advocates (HAI) has been sold to drug supplier Amerisource Bergen (ABC) for about four times projected 2006 revenues, or $83 million. Yes, that seems awfully pricey, but HAI is also quite profitable, with margins above 50%.
Based on an EBITDA multiple in the 5x – 6x range, the price doesn’t seem quite so outrageous.

Continue reading Health Advocates – was the price too high?

Sep
27

Workers comp’s top problem drug

Posted by Joe Paduda on Wednesday, September 27th, 2006 | Comments

Actiq, the lollypop pain killer, is rapidly becoming the biggest problem drug in workers comp. FDA approved only for treating cancer pain, the potent narcotic is now on most payers’ top 5 drug list (ranked by dollars spent).
There are likely several factors that have enabled a drug clearly not approved for musculo-skeletal conditions to achieve this high “honor”.

Continue reading Workers comp’s top problem drug

Sep
20

BWC – now it’s getting really disgusting

Posted by Joe Paduda on Wednesday, September 20th, 2006 | Comments

If you have yet to shower, you may well need one after reading this.
Just in time for election season, another chapter in Ohio Bureau of Workers’ Comp scandal is heading for court. The latest news comes from the Toledo Blade, which reported last week that the BWC’s CFO is alleged to have accepted bribes from brokers for investment firms eager to invest the Bureau’s funds.

Continue reading BWC – now it’s getting really disgusting

Sep
11

Has workers comp “managed care” worked in Ohio?

Posted by Joe Paduda on Monday, September 11th, 2006 | Comments

The Cleveland Plain Dealer has published an article that is highly critical of Ohio’s workers comp managed care program. The analysis performed by the paper (and subsequently reported by AP and other news outlets) notes that administrative costs associated with claims management have gone up much faster than the rate of inflation,while medical costs have experienced a similar trend.
Several other papers inside and outside Ohio are also focusing on the BWC managed care program.

Continue reading Has workers comp “managed care” worked in Ohio?