TPA Medical Management Critical for Cost Containment
The third party administrator (TPA) who handles your workers’ compensation claims needs to be especially strong in their medical management skills. The top tier TPAs will have their own medical management division overseeing and controlling the medical cost of your claims and working in conjunction with the workers’ compensation adjusters.
The most effective ways to control your medical cost include:
- Telephonic nurse case managers
- Field nurse case managers
- Senior nurse reviews
- Utilization reviews
- Medical bill reviews
- Prescription management
- Physician review
- On-site clinics
- Injury triage
- Wellness programs
- Preferred provider networks
Nurse Case Managers
Nurse case managers are experienced nurses who are utilized to coordinate and manage the medical care for an injured employee. There are two primary types of nurse case managers, telephonic case managers (TCM) and field case managers (FCM). Both TCM and FCM will:
- Coordinate the medical care
- Consult with the physician on treatment options
- Prevent over utilization of medical treatment
- Monitor the employee’s medical recovery
- Provide frequent updates to the adjuster and employer on the employee’s medical progress
- Coordinate the employee’s return to work, either light duty or full duty
- Facilitate communication between the employee, employer and physician
- Manage the medical rehabilitation of the employee
The primary difference between the TCM and the FCM is the location of their work. The TCM will work from his/her office and perform all activities on the workers’ compensation claim by telephone and e-mail. The FCM will often meet in person with the injured employee and will accompany the employee to medical appointments when appropriate. While not a strict division of injury assignments, the FCM is more often utilized on severer injuries.
Senior Nurse Review
With the senior nurse review, a highly experienced nurse provides continuous oversight of medical care. This provides for identification of recovery obstacles early in the life of the claim. Through continuous monitoring of the medical care, the senior nurse reviewer can also verify the quality of medical care if the recovery time exceeds the normal disability duration guidelines. When a senior nurse reviewer is involved in the workers’ compensation claim, the medical management provider will also have physicians with whom the senior nurse reviewer can consult.
The medical management company should provide utilization review services. A utilization review is an independent confirmation of the necessity for medical services. There are 3 types of utilization review. They are:
- Pre-certification Review – an experience nurse will collect all the medical information including the symptoms, diagnosis, test results and the reason a physician is requesting a specific medical service. The nurse will compare the medical information against the normal criteria for a specific treatment. If the nurse concurs, the medical service is approved. If the nurse determines the medical care is not necessary, the matter is referred to a physician for a peer review, and acceptance or denial of the requested medical service.
- Concurrent Review – is a review of the medical necessity while it is in progress. This type of utilization review is often used during hospital stays, or on-going multiple outpatient visits, for example: physical therapy.
- Retrospective Review – After a medical service has been completed, but before a payment is made for the service, the nurse reviews the reasons for the service and the necessity for it. If the medical service was not needed, the retrospective review gives the adjuster justification and documentation as to the reason the medical provider is not compensated for the medical service.
Medical Bill Review
The medical management company reviews and verifies the accuracy of the medical bill diagnostic codes and the medical bill charges. The medical bill charges are compared to the medical fee schedule established by the state. When there is no fee schedule, the medical charges are compared with what is customary, reasonable and necessary
Pharmacy Benefit Manager
A pharmacy benefit manager provides a network of pharmacies to provide medications at the best possible price. The pharmacy benefit manager will also monitor the utilization of prescription drugs to prevent the overutilization of drugs through premature fill request, excessive dosages, multiple providers, multiple pharmacies and multiple drugs used for the same purpose.
When an injured worker is not responding to the medical care within the range of normal recovery time, a physician review is often appropriate. The physician review is a peer review by a specialist who will evaluate and document the medical necessity of the past, current and future medical treatment. The physician review provides an in-depth evaluation of the medical necessity of the treatment being provided to the injured worker. The review process can strengthen the return to work program by verifying the appropriateness of an injured worker being on modified duty work. The review process can also be used to evaluate the accuracy of an impairment rating provided by the employee’s medical provider.
On-site (employer’s work site) medical clinics staffed by RNs, nurse practitioners and physician assistants have proven they can curb the fast-rising cost of medical care for both personal and work-related injuries and illnesses. The on-site clinic provides the medical care making it convenient for employees who do not have to leave work for care. Employees are referred to off-site medical facilities only if the injury or illness is beyond the scope of the medical professionals in the on-site clinic.
Injury triage is the process of having an experienced nurse evaluate the injured employee’s medical needs through the use of algorithms, software and an in-depth interview of the injured employee. Based on the information obtained, the triage nurse makes decisions on the appropriate level of medical care needed. While triage nurse can be utilized any time in the course of the workers’ compensation claim, it is most effective when it is conducted immediately after an injury. The triage nurse directs the employee to the most appropriate medical provide within the in-network of service providers. This prevents the employee from over utilizing medical care while ensuring the employee obtains the medical care needed.
A wellness program is a company sponsored effort to improve the health of employees. A complete wellness program will include nutrition and health education, physical fitness, health screenings and behavior modification. An employer benefits from a wellness program through both lower cost of health insurance and lower cost in the workers’ compensation benefits. Additionally, a wellness program will result in lower absenteeism and a corresponding increase in productivity.
Preferred Provider Networks
A preferred provider network is an organization of doctors, hospitals, diagnostic facilities and other medical providers who have agreed with the insurance company or self-insured employer to provide medical services to injured employees covered by workers’ compensation insurance. In exchange for the insurer or employers sending a volume of business to them, the medical providers agree to a pre-determined reduction in their normal charges for services. The reduction in cost can be substantial for the insurer or employer.
Employers should select one medical management partner that can provide expertise in all of these areas rather than multiple medical management partners. A medical management partner that covers all of these areas can integrate the medical cost control services eliminating duplication of services and eliminating gaps in medical cost control.
Author Rebecca Shafer, JD, President of Amaxx Risk Solutions, Inc. is a national expert in the field of workers compensation. She is a writer, speaker, and publisher. Her expertise is working with employers to reduce workers compensation costs, and her clients include airlines, healthcare, printing/publishing, pharmaceuticals, retail, hospitality, and manufacturing. She is the author of the #1 selling book on cost containment, Workers Compensation Management Program: Reduce Costs 20% to 50%. Contact: RShafer@ReduceYourWorkersComp.com.
Editor Michael B. Stack, CPA, Director of Operations, Amaxx Risk Solutions, Inc. is an expert in employer communication systems and part of the Amaxx team helping companies reduce their workers compensation costs by 20% to 50%. He is a writer, speaker, and website publisher. www.reduceyourworkerscomp.com. Contact: email@example.com.
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Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional about workers comp issues.