Workers' compensation medical costs now amount to 60% of claim costs and are gaining. Moreover, Managed Care programs have been in place over twenty years while medical costs continuously spiral upward. All the while, Bill Review, Provider Discount Networks, Medical Case Management, Utilization Review, and Peer Review managed care programs remain entrenched and unchanged in spite of dismal results. It is a crisis we can no longer ignore.

Designing new medical management programs is not the answer. Commitment to them is deep and sunk costs are huge. Surprisingly, the original managed care concepts are sound. Managed care organizations have slipped into complacency and not kept up with technology to make themselves lean and effective. They concern themselves more with increasing their revenue rather than focusing on results. That must change. They must be held accountable and demonstrate proof of value — better claim outcomes with restrained costs. To stimulate and optimize managed care programs, to improve their performance and to achieve better results, the data must be leveraged, analyzed and applied to the medical management process.

Leveraging the data to transform medical management programs need not be an onerous task. In fact, it is quite doable and affordable using the elements outlined here. Nevertheless, employers must take the lead. Whether managed care programs are controlled directly by them or are contracted through the insurer or TPA, employers are the ultimate effective change agent. Only they can demand and receive medical data analysis and documented accountability from their own or other managed care programs. (workersxzcompxzkit)

Gathering and mobilizing the data to make medical management more effective need not be overwhelming. The process has three components: Integrate the data; Analyze the data, Operationalize the data.

Integrate the Data

Integrating relevant medical data is critical because in workers' compensation, data sets are typically held in disparate locations. The most important data sets are the medical billing and claims level data. Integrating the data means bringing it together in a logical way so claims can be evaluated from beginning, through the course of the claim to closure.

Medical billing data is important because it contains medical treatment detail that is often only summarized in claim systems. Billing data, usually derived from Bill Review systems, might be located with whomever is paying the bills or it might reside with the Bill Review company, or both.

Besides medical billing data, select claims level data is important because the medical treatment course should always be evaluated in context with claim outcomes. Claims level data contains indemnity payments, return-to-work information and claimant disposition information, all necessary for evaluating the course of the claim and provider performance.

Importantly, employers should intentionally own their data, regardless of the vendor who generates and acts on it. They should insist on a data ownership caveat in all vendor contracts. Recognizing their ownership of the data, employers can obtain it from vendors for their own use or for use by their medical data analysis contractors.

Analyze the Data

Analytics (data analytics) and metrics are sometimes off-putting terms, generating concern that the process will be complex and expensive. However, it simply means the data is re-organized in multiple ways to make the process easy to understand and to compare process with outcomes. The metrics chosen will depend on organizational interest, personnel wisdom, and collaboration with insurers, TPA's, and professional consultants.

Of particular current interest is predictive modeling or profiling. Predictive analytics seeks to discover trends and relationships in the data that may be causative or portend high risk and cost. Most organizations will require consultant specialists to execute such analyses. However, less esoteric and more available metrics are very effective in strengthening medical management initiatives.

Examples of metrics that can be used to optimize concurrent medical management include comparing costly treatments with more traditional procedures to see the differences in outcome and cost, measuring and comparing claims duration and outcomes for similar injuries when physical therapy, chiropractic or surgery are used. Results of the analyses will provide decision support and direct interventions.

Evaluating provider performance based on the data is also enlightening and valuable. Comparative evidence of claim outcomes for individual providers is instructive, even for providers. Often, such feedback information presented to them will influence future treatment practices. Additionally, decisions about directing to providers can be data-supported rather than personal preference or the PPO membership.

Operationalize the Results of Data Analysis

The trickiest part of data-inspired medical management is operationalizing the results of analysis. Creating graphic presentations of analysis is nice, but linking such intelligence to operation is critical. Linking to operations makes medical analytics actionable and effective. Moving from intelligence gained through medical analytics to appropriate action creates efficiency and cost management.

In order to optimize medical management, to make it efficient and accountable, the analyzed data must be acted upon appropriately and as concurrently as possible. This is best done by developing easy electronic tools for medical managers to access the results of analysis. Often it means providing electronic alerts based on rules derived from analysis, and by continuously analyzing current data to avoid unfortunate events. Operationalizing analytics is the only way to stop accepting business as usual from managed care organizations and begin realizing new payoffs of medical cost control.

WorkersCompKit Blog welcomes guest author Karen Wolfe, BSN, MA, MBA, President/CEO, MedMetrics, LLC. Karen is founder and president of MedMetrics LLC, an Internet-based Workers' Compensation medical analytics company. She applies her medical knowledge to gathering, understanding and applying Workers' Compensation data to the operational process. MedMetrics imports, integrates, and analyzes its clients' medical billing and claims level data, and uses tools such as Predictive Intelligence Profiling and Medical Provider Performance Assessment to gather and analyze data. Contact: Phone: 541-390-1680; Karenwolfe@medmetrics.org  www.medmetrics.org

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