Don’t Plan to Fail: Best Practices for Addressing Medicare Advantage Plan Reimbursement

Benjamin Franklin must have been contemplating Medicare Advantage Plan reimbursement when he uttered one of his famous lines: “If you fail to plan, you are planning to fail.” Over the past few years Medicare Advantage plans have increasingly been seeking reimbursement for payments made stemming from workers’ compensation, liability and no-fault claims, otherwise known in Medicare circles as Non-Group Health Plans (NGHPs). Despite these increasing efforts, many NGHPs have not planned how they should respond to such reimbursement claims.

 

With the goal of working with our clients to educate and assist with proper planning, earlier this month, Tower MSA was privileged to have Brian Bargender, Subrogation & Other Payer Liability Business Consultant for Humana, participate in a webinar to discuss reimbursement rights of Medicare Advantage plans, and best practices for investigating and responding to reimbursement claims. For those who were unable to attend, or would like a refresher, we are pleased to provide below a summary of Mr. Bargender’s presentation along with some final thoughts and takeaways.

 

 

Medicare Advantage Plan Background

 

Part C Medicare Advantage plans (MA plans) are alternative delivery mechanisms for traditional Medicare benefits (Parts A and B) provided by private companies under contract with CMS. Medicare beneficiaries have the option of choosing one of these Medicare Advantage plans during annual or special enrollments periods. The three largest MA plan sponsors (representing almost half of the available plans) are UnitedHealthcare, Humana and Aetna. As of 2017, one-third of Medicare beneficiaries are enrolled in MA plans.

 

 

Medicare Advantage Plan Recovery Rights

 

Pursuant to CMS direction, MA plans must enforce the Medicare Secondary Payer Act (MSP) and will be audited by CMS for compliance with the Act. Consequently, these plans are obligated to coordinate benefits such that MA Plan coverage is denied when a primary payer is covering treatment and when the MA plan pays, but later learns of primary payer responsibility, seek reimbursement for payments made relating to the particular workers’ compensation, liability or no-fault claim.

 

MA plans right to reimbursement, including double damages, from NGHPs under the MSP Act has been acknowledged in at least two significant federal appellate court decisions:

 

  • In re: Avandia, 685 F.3d 353 (3d Cir. 2012)
  • Humana Med. Plan, Inc. v. W. Heritage Ins. Co., 832 F.3d 1229 (11th Cir. 2016)

 

 

Medicare Advantage Plan MSP Enforcement Challenges

 

Despite CMS’s direction to MA plans regarding enforcement of the MSP Act, including coordination of benefits, the data available to the MA plans to perform this task is inconsistent and error prone. Consequently, MA plans have taken one of three approaches to MSP enforcement:

 

Inactive: Minimal effort
Reactive: Relying upon member and medical provider reporting of primary plans
Proactive: Claim screening and investigation

 

As Mr. Bargender explained, Humana is taking the proactive approach. Nonetheless, the challenges faced by Humana in identifying coordination of benefits situations has proven difficult as a result of gaps in medical provider and Medicare beneficiary self-reporting and data provided by CMS which is “too little, too late, often wrong.” Additional challenges faced by MA plans are incomplete direction from CMS and non-cooperation of Medicare beneficiaries and plaintiff attorneys to MA plan reimbursement claims. As such, Humana utilizes a multi-faceted approach of member questionnaires, public records, such as accident reports and workers’ compensation claims, and non-public records, such as data relayed by CMS, to determine possible MSP coordination of benefits and reimbursement opportunities.

 

 

Best Practices for Non-Group Health Plans and MA Plan Reimbursement

 

Humana’s proactive approach then has the ultimate goal of reimbursement for charges related to the claimed injury. Mr. Bargender shared the following basic precautions to be taken by NGHPs:

 

  • Train front-line staff on MSP basics – including MA & Part D
  • Assume older & disabled claimants have some form of Medicare
  • Be proactive when told claimants don’t have original Medicare
  • Watch for other payer info in medical records
  • Watch for notices from other payers
  • No-fault and accepted work-comp claims
  • Pay treating providers directly for outstanding medical bills
  • Be suspicious of billing gaps (other payer?)

 

And when it comes to Liability and disputed or denied workers’ compensation claims:

 

Find out who paid for medicals

  • Providers rarely wait for settlements
  • CMS “no payment” letters aren’t the last word
  • Request benefit ID card(s)
  • Ask to see other payer “no payment” letters
  • Medicare/Medicaid dual beneficiaries? …assume Part D paid Rx

 

Address MSP repayment before agreeing to settlement

  • Determine amount before settlement is finalized
  • Don’t assume plaintiff will reimburse MA plan or unpaid providers
  • What does settlement indemnification language actually accomplish?

 

In terms of negotiating and resolving MA plan claims for reimbursement, Mr. Bargender offered as follows:

 

Most MA plans are open to working with primary payers.

 

Focus on these:

  • Rationale for denying beneficiary’s underlying claim, not MA/Part D rights
  • Limits exhausted, treatment not allowed/capped, etc.
  • What’s related (was it in the demand or release?)
  • Errors in plan’s payment ledger
  • Extenuating circumstances

 

Not on these:

  • Reasonableness of amounts paid by MA
  • Claim filing time limits vs. MSP statute of limitations
  • Contract language” in the MA Evidence of Coverage document

 


Final Thoughts and Takeaways

 

In working with Mr. Bargender and the subrogation team at Humana, we have found them very helpful in promptly identifying specific reimbursement claim information where the claimant was enrolled in a Humana Medicare Advantage plan. Further, they are open to understanding the particular liability issues and bases for settlement, something not typically found with the Medicare conditional payment recovery contractors.

 

The primary takeaway from Mr. Bargender’s presentation is NGHPs must be proactive in identifying whether a Medicare eligible claimant is enrolled in a MA plan, and, if so, investigate whether the plan is seeking reimbursement for payments made related to the claim. As there exists no central database accessible to NGHPs in which to identify the MA plan a claimant is enrolled, the claims handler must be proactive in inquiring of the claimant whether they are enrolled in such a plan.

 

Tower MSA Partners will work with our clients to assist in identifying whether a claimant may be enrolled in a MA plan, identify the name of the plan and investigate whether such plan is seeking reimbursement stemming from the claim. We stand ready to assist you through general consultation on ensuring your MSP compliance program appropriately addresses MA plans or consultation on MA plan recovery* in a specific claim.

 

*While we did not delve into Part D Prescription Drug plans in this article, such plans arguably have similar reimbursement rights as Part C Medicare Advantage plans. NGHPs should also be aware of the potential for reimbursement claims from these plans.

 

 

 

Author Dan Anders, Chief Compliance Officer, Tower MSA Partners. Dan oversees the Medicare Secondary Payer (MSP) compliance program. In this position, he is responsible for ensuring the integrity and quality of the MSA program and other MSP compliance services and products. Based upon his more than a decade of experience in working with employers, insurers, TPAs, attorneys and claimants, Dan provides education and consultation to Tower MSA clients on all aspects of MSP compliance. Contact: (847) 946-2880 or daniel.anders@towermsa.com

The Most Common Belief Is NOT A Factor In Workers’ Comp Success

So imagine the scene. You’re at a party or a social gathering, and you’re talking in a conversation with someone that’s an acquaintance. Somebody that you know, but you don’t know really well. And you start talking about what it is that you do for a living.

 

 

“We’ve Been Really Lucky to Not Have Many Injuries”

 

And you mention that you’re a workers’ compensation professional. And the response during that conversation is, “Oh, we’ve been really lucky over the past number of x weeks or years that we haven’t had very many injuries at my company.” Or they’ll say, “We’ve been really unlucky, and we’ve had a rash of injuries over the past number of weeks, months, or years.” And you’re likely going to respond with the socially appropriate response that’s says, “Yes, we’ve been really lucky or unlucky, too.” But you’ll know in your heart, or you should know in your heart, that success in injury prevention and injury management has very little to do with luck.

 

 

Success in Workers’ Compensation Has Very Little to Do With Luck

 

Success in injury prevention and injury management has very little to do with luck. Hello, I’m Michael Stack, CEO of AMAXX. And there’s two points that I want you to take out of this video lesson today. One is internalizing that fact, that luck, while it may be a small percentage of your success, it’s a very small percentage. Your proactive planning, your culture, your system that you set up to prevent injuries as well as care for those employees after injury to get them successfully back to work is going to be the major dominating factor in the success or failure of your program.

 

 

First Step is to Clarify Workers’ Comp Vision

 

The second piece that I want you to take out is the reason that people say, luck is the major dominant factor in our success or failure in workers’ comp, it’s because there’s no vision, there’s no goal for what you’re trying to accomplish. Because that’s the first step on that path to workers’ comp mastery and workers’ comp success. So here’s how you get started with clarifying that vision for your organization.

 

I want you to answer this question:

 

If I were to wave a magic wand, and in one year from today, you have the perfect workers’ compensation, injury management and prevention program.

 

Answer these three questions:

 

  1. What does that look like for your organization? What does that look like for your organization? If you had this perfect program, draw that out in a paragraph sentence type format.
  2. What does that feel like for you, as the person that designed and implemented this program successfully? What does that feel like for your employees?
  3. What has that done for your culture? What has this done for your organization? What has it done for your employees’ values? What has it done for your employees’ attitudes? What has it done for the culture of your organization? And what has it done for your company’s bottom line?

 

If I were to wave a magic wand and in one year from today, you could have the perfect workers’ compensation program, what does that look like at your organization? What does that feel like for you and your organization? What has that done for your career, what has that done for your employees, what has that done for your company’s bottom line? If you can clearly define that vision, you are well on your way to success. Again, I’m Michael Stack with Amaxx. And remember your work today in workers’ compensation can have a dramatic impact on your company’s bottom line. But it will have a dramatic impact on someone’s life. So be great!

 

 

Michael Stack - AmaxxAuthor Michael Stack, CEO Amaxx LLC. He is an expert in workers compensation cost containment systems and helps employers reduce their work comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is founder & lead trainer of Amaxx Workers’ Comp Training Center. .

 

Contact: mstack@reduceyourworkerscomp.com.

Workers’ Comp Roundup Blog: http://blog.reduceyourworkerscomp.com/

 

©2017 Amaxx LLC. All rights reserved under International Copyright Law.

 

Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional.

 

6 Tips to Battle Workers’ Comp Comorbidities

Proactive workers’ compensation claim management teams are constantly seeking opportunities to reduce workers’ compensation costs and promote efficiencies.  One such area to address these concerns is battling comorbidities and developing a healthier workforce.  Doing so in an effective matter will reduce the cost of claims and significantly benefit your program.

 

 

What Are Comorbidities?

 

From a medical point of view, a “comorbidity” is a medical condition that exists along with other injuries or ailments.  An example of this in the context of a workers’ compensation claim is a claimant suffering from a work-related injury who has another medical condition.  Common examples include high blood pressure, diabetes, cancer or mental health conditions.  Modern medicine even classifies smoking and use of tobacco as a comorbid condition.

 

It is important for members of the claims management team to identify claimants who have a comorbid condition.  This is because they may often require additional medical care and treatment, or there could be an aggravation of the underlying condition as the result of the work injury.  The ramifications of this include prolonged disability, increased medical care and treatment, addiction to prescription pain medication or permanent and total disability.

 

 

Dealing with the Immediate Issues

 

Once a claim handler is aware of an injured worker with a comorbid condition, it is important to position the matter to avoid future long-term exposures.  In the short-term, members of the claims management team need to monitor claims with care.  This includes a number of actions to keep on top of the claim:

 

  • Frequent contact with the employee to monitor progress and evaluate for referral to defense counsel;

 

  • Determine if or when the employee should be seen for an independent medical examination. Depending on the nature of the claim and comorbid condition, this may require the use of multiple medical experts.  This is frequently common in claims involving an underlying psychological and/or psychiatric condition; and

 

  • Opportunities to put the claim into litigation, as necessary.

 

 

Techniques for Successful Claim Management

 

It is also important to work with interested stakeholders to seek solutions that will develop a healthier workforce to mitigate future claims. Examples of being proactive in this area include:

 

  • Developing a smoking cessation and tobacco dependence program. It is well-documented that workers’ compensation claims involving a smoker/tobacco user cost significantly more when compared to their non-tobacco using counterparts.  While fewer Americans are using tobacco, a certain segment of the workforce continues to use these products;

 

  • Encourage employers to offer gym memberships (free or reduced) and other weight loss programs. Other options include encouraging people to take regular breaks to stretch and move around.  This is also an opportunity for employers to seek out medical insurance programs that offer discounts for members who undergo biometric testing; and

 

  • Increasing the level of education workers have regarding their eating habits. This includes the development of relationships with organizations and registered dieticians who provide information on better food selection, preparation and consumption.

 

 

Conclusions

 

Having an effective workers’ compensation program goes beyond knowing the law and working your claim files in an effective matter.  Proactive claim management teams need to address the underlying issues of a claim such as claimants with comorbid conditions to reduce costs in a program.  This includes addressing issues present on a file and promoting a healthier workplace to mitigate the risk of expensive future claims.

 

 

Michael Stack - AmaxxAuthor Michael Stack, CEO Amaxx LLC. He is an expert in workers compensation cost containment systems and helps employers reduce their work comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is founder & lead trainer of Amaxx Workers’ Comp Training Center. .

 

Contact: mstack@reduceyourworkerscomp.com.

Workers’ Comp Roundup Blog: http://blog.reduceyourworkerscomp.com/

 

©2017 Amaxx LLC. All rights reserved under International Copyright Law.

 

Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional.

Reduce Work Comp Costs Through Advocacy Based Claims Management

Claims management teams are constantly seeking innovative solutions to running an effective workers’ compensation program.  This includes providing quality services to employees who sustain work injuries and being a zealous advocate for their clients.  Part of the solution that has benefited programs in an “advocacy based” model of claims management.  Studies have proven this as an opportunity to meet program objective and reduce costs in the form of quicker return to work.

 

 

What is “Advocacy Based” Claims Management?

 

Under this model of claims management, the members of the claims team seek to empower employees to improve injury outcomes and get them back to work in a timely manner.  This process requires interested stakeholders to be active in assisting injured workers at all steps of the claim. It also requires them to “go the extra mile” and empathize with the situations someone experiences following a work injury.   Part of the process can include keeping the employee informed with details so they can in turn make decisions in their recovery.

 

 

It Starts with Words

 

Words mean things—especially when you are recovering from a work injury.  This is a crucial step in understanding the tribulations someone suffering from a work injury is going through.  It also helps with perception being reality in a positive manner.

 

Changing the vocabulary used during the claims management process is important.  This helps refocus conversations and processes.  Examples include:

 

  • Claimant/employee: By not using these words and instead referring to someone as “a person injured at work,” it helps humanize the person and what they are going though; and

 

  • Claims examiner: Use of these words is often outdated and reminds someone of a faceless bureaucrat sitting behind a desk.  By referring to someone as a “claims representative,” it again humanizes the process.

 

 

Finding Common Ground

 

While members of the claims management team have a fiduciary duty to their insureds, they can also find common ground with people suffering from a work injury.

 

  • Prescription Drug Abuse: There has been a lot said and written about prescription drug abuse in the workers’ compensation system.  The common denominator among many persons who end up dying from using these medications is a personal injury.  Even people with the best of intentions can become victims of abuse by not having a strong advocate.  This can include members of the claims management team who help control the number of drugs consumed and by educating the people they work with about the dangers of these substances.  Other activities such as monitoring a person’s intake and working with their doctors to minimize the chances of abuse are key.

 

  • Injury response: A fast an effective injury response is another method claims management teams can employ to be an advocate on the workers’ compensation process.  This starts with providing employers with the necessary tools to respond after an incident.  Regular, frequent and personalized contact with a person recovering from a work injury are also key.  While it might take extra time, being active in the care a person receives buys good will and breaks down barriers in an otherwise adversarial process.

 

  • Establish expectations for all: All the main actors in a workers’ compensation claim need to take ownership over the care and recovery of an individual.  For the employee, this includes concentrating on following their doctor’s instructions on rehabilitation.  Employer representatives also need to be engaged and coordinate care with the claims management team.

 

 

Conclusions

 

Effective members of the claims management team need to be an advocate for the person involved in their claims.  This starts with empathy toward the person suffering from the effects of a work injury.  It also includes avoiding excessive use of prescription drugs and responding to an incident in a proactive manner.  Taking these steps can reduce claims and still allow for the claims representative to look out for the best interests of a workers’ compensation program.

 

 

Michael Stack - AmaxxAuthor Michael Stack, CEO Amaxx LLC. He is an expert in workers compensation cost containment systems and helps employers reduce their work comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is founder & lead trainer of Amaxx Workers’ Comp Training Center. .

 

Contact: mstack@reduceyourworkerscomp.com.

Workers’ Comp Roundup Blog: http://blog.reduceyourworkerscomp.com/

 

©2017 Amaxx LLC. All rights reserved under International Copyright Law.

 

Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional.

Inside Tips & Tricks for Effective Social Media Investigation

Fraud, waste and abuse (FWA) continue to be a significant driver in workers’ compensation program costs.  The result for many programs are higher costs per claim, which are passed along to the insured.  This trickle-down effect ultimately hurts the employees, which are the people served by workers’ compensation insurance programs.  Now is the time for interested stakeholders to employ innovative and creative investigative techniques used advanced techniques in claims investigation based on easy to use technology.

 

 

Social Media: Going Beyond the Basics

 

Social media investigation continues to be an area of initial research in every workers’ compensation claims investigation.  This is based on the continued growth in it is use over the last decade.  It is also an important area to investigate given its use with all generations.  The use of Facebook is a common example:

 

  • There are currently over 1.5 billion users of Facebook worldwide. The United States contains some of the most active users on this social media platform;

 

  • Over 72% of people who use the Internet are connected on Facebook; and

 

  • Nearly 10% of Facebook users do not change the privacy settings on their account. This means there is still a significant portion of users who allow all posts and updates to be visible to the general public.

 

Pictures posted to Facebook and other social media often contain hidden metadata.  This is information stored in the background due to the user failing to adjust the settings on their smartphone or other cameras.  The result is a treasure trove of information for the taking.  This includes:

 

  • Date and time stamp information as to when the photograph was taken; and

 

  • Specific longitude/latitude information as to where the photograph was taken.

 

Using this data, someone creates a “geofence,” which tells the world when and where a specific event took place.  It also limits the ability of someone to testify otherwise.

 

 

Vehicle Tracking and Sightings

 

State and local governments have employed millions of public security cameras across the country to capture real time images of what is taking place in their communities.  Part of this technology includes the use of license plate tracking information, which records when and where a particular vehicle passes a certain location.

 

While accessing and searching this information may be time consuming, it can establish a number of items that can be useful in a claims investigation.

 

  • The location where a claimant’s vehicle has visited;

 

  • Establish a pattern of locations visited by an employee;

 

  • Verify the testimony of an employee concerning the route taken to a certain location, which is important in “traveling employee” cases; and

 

  • Accessibility of information nationwide—it is used in every major city in the United States.

 

 

Keyword Search Technology

 

Most social media platforms are driven by “keyword” search technology.  This allows all users to use various terms and locate posts and other information from all users on the platform.

 

In the context of a workers’ compensation claims investigation, any user can ethically search to find information on where someone has been.  This includes postings by organizations or events listed in the platform that tag or record the names of attendees.  Although a user has set their privacy to limit the information from strangers, the fact someone else has a posting that includes a specific person’s name allows the public to obtain information.

 

 

Conclusions

 

Members of the claims management team have lots of readily accessible information at their hands based on today’s technology.  Proactive members will learn how to harness this information to advance and coordinate surveillance on workers’ compensation claims in a cost-effective manner.  The ultimate result is lower program costs and quicker claims resolution on troublesome files.

 

 

Michael Stack - AmaxxAuthor Michael Stack, CEO Amaxx LLC. He is an expert in workers compensation cost containment systems and helps employers reduce their work comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is founder & lead trainer of Amaxx Workers’ Comp Training Center. .

 

Contact: mstack@reduceyourworkerscomp.com.

Workers’ Comp Roundup Blog: http://blog.reduceyourworkerscomp.com/

 

©2017 Amaxx LLC. All rights reserved under International Copyright Law.

 

Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional.

Where to Start For Best In Class Workers’ Comp Claims Management

All workers’ compensation claims management teams should have an attitude that seeks best in class when it comes to claims management practices.  This includes a focus on injury prevention, investigation and seeking to settle cases in a timely manner.  By taking proactive steps in these areas, any claims team will be set up for success and improve processes for employers and employees suffering from work-related injuries.  It will also reduce costs in the long run.

 

 

Start with Injury Prevention and Investigation

 

Injury prevention and investigation requires members of the claims management team to be proactive.  This includes creating partnerships with their clients on all workplace safety matters.  They also must be involved on the investigation of an injury and to ensure the correct reports are made in a timely manner.

 

  • Safety Recommendations: Members of the claims management team must be able to identify safety hazards and make recommendations regarding workplace safety.  This includes a review of safety equipment being used in the workplace.  Examples of this can include a review of workplace ergonomics and the rotation of job duties in repetitive lines of work or those that require heavy lifting.  It can also include the use of forensic experts who can dissect the anatomy of an injury and suggest improvements.  Injury avoidance measures also promotes employee satisfaction and positive morale within any company.

 

  • Primary Liability Determination: Time is of the essence when it comes to the investigation of any injury.  Claim handlers must be proactive on this issue to encourage their clients to obtain an injury report immediately and assist in the identification and follow-up with witnesses.  It is also important to understand and correctly apply the law.  Failure to make accurate primary liability determinations is an unnecessary cost and increases work for all interested stakeholders.

 

  • OSHA and Other Safety Compliance: Compliance with government and industry safety standards is an important component of any workers’ compensation program.  Claim handlers can help educate their clients on the basics of OSHA reporting.  This also includes information on state safety organizations tasked with injury investigations.  Failure to report any work injury in a timely manner can result in fines and other adverse consequences.

 

 

Promotion of Settlement Practices

 

The only good file is a closed file!  This is the mantra used throughout the claims management industry.

 

If a case is investigated and handled properly, it can be positioned for timely resolution.  Failing to do so can result in extra costs to any workers’ compensation program.  There are other additional considerations to be mindful of to save a program money and earn the respect of employer stakeholders.

 

  • Subrogation: This is the practice of seeking reimbursement from another party who shares in the legal responsibility for a work injury.  In order for any subrogation action to be successful, it is important to preserve physical evidence.  Common instances where subrogation recovery comes into play includes products liability actions, motor vehicle accidents and premise liability claims (slips/falls).  Examples of this can include a power tool or piece of machinery in a work injury.  Photographs of surface conditions or accident scenes are other forms of evidence that required for successful third-party recovery.

 

  • Independent Medical Examinations: In many jurisdictions, the defense interests have one opportunity to have an injured employee be seen for purposes of an IME.  Failure to prepare for this by recovering the necessary medical documents and obtaining other background information on the claim can result in a waste of time and money.

 

  • Medicare Secondary Payer Compliance: This is an area that continues to dominate workers’ compensation claims management given the increasing number of Americans on Medicare and/or Social Security Disability.  Part of any effective workers’ compensation program includes working with legal experts or other service providers who understand these complex issues.

 

  • Structured Settlement: Structured settlements are a stream of tax-free (IRC 104(a)(2) of (a)(3)) secure periodic payments providing income to an injured worker to settle a workers’ compensation claim. In addition to providing income for an injured worker, a structured settlement can provide income and up-front cash for attorney fees, medical expenses, and related liens. A structured settlement is a valuable piece of a comprehensive claim settlement strategy and creates a ‘win’ for all parties to a workers’ compensation settlement; the employer, the payer, the injured worker, and the attorneys

 

 

Conclusions

 

Claims management teams need to focus on high standards when it comes to assisting employers and other interested stakeholders in workers’ compensation claims.  Best-in-class should be the goal when developing a workers’ comp management program.  This starts with proactive injury prevention and investigation, as well as a firm understanding of settlement tools.

 

Learn more: The Step by Step Process to Master Workers’ Comp in 90 Days

 

Michael Stack - AmaxxAuthor Michael Stack, CEO Amaxx LLC. He is an expert in workers compensation cost containment systems and helps employers reduce their work comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is founder & lead trainer of Amaxx Workers’ Comp Training Center. .

 

Contact: mstack@reduceyourworkerscomp.com.

Workers’ Comp Roundup Blog: http://blog.reduceyourworkerscomp.com/

 

©2017 Amaxx LLC. All rights reserved under International Copyright Law.

 

Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional.

How to Grade Your Workers’ Comp Adjuster

In school an “A” grade is the standard that everyone wants to meet. Whether you are in elementary school or working on your master’s degree, your performance results in a grade being given to the work you complete. To earn an A grade requires having at least 95 percent of the school work done correctly. Following the same basic grading principles – A, B, C, D, F – you can measure the performance of your workers compensation adjuster.

 

The following is a grading outline you can use to measure the performance of your workers’ comp adjuster on each claim. There are ten categories with 10 points each, or 100 points total. When you review your adjuster’s file on-line, grade each category against the measurements listed here. [If your Best Practices give the adjuster different time lines then what is given here, use your own Best Practice guidelines in grading your adjuster]. Give the adjuster the number of points (zero to ten) earned in each category.

 

 

Category 1 – Employee Contact:

 

The adjuster should contact the injured employee within 24 hours of the receipt of the claim (same day contact would be more points than next day contact). True contact entails an exchange of information between the adjuster and the employee, not just leaving a message on voice mail. If the adjuster was unable to reach the employee within 24 hours by telephone (or in person on severe claims), a contact letter should be sent to the employee along with a medical authorization or any state required forms. On any claim involving questionable compensability or subrogation, a recorded statement should be obtained from the employee. You’re looking for a “quality contact.”

 

 

Category 2 – Employer Contact:

 

The adjuster should easily score all ten points in this category by contacting the employer by phone (in person with extreme employee injuries) within 24 hours of receipt of the claim (same day contact would be better). On any claim involving questionable compensability or subrogation, a recorded statement should be obtained from the employee’s supervisor. Also, any witnesses to the accident should be contacted if the injuries are severe.

 

 

Category 3 – Medical Provider Contact:

 

The office of the medical provider should be contacted within 24 hours of the report of the accident to confirm the nature and extent of the accident, and the ability of the employee to return to work on modified duty/light duty. In the jurisdictions that do not require a medical authorization to obtain the medical records on the employee’s injury, the medical records should be requested during this initial contact.

 

 

Category 4 – Investigation:

 

If the adjuster has done a quality job in the three contact categories, earning points for completion of the investigation should be rather easy. The investigation should address all issues that impact coverage, the nature and extent of the injuries, the benefits owed, subrogation and subsequent injury fund (where applicable). An ISO Index Bureau search should be filed. If the investigation has been completed properly, the adjuster should be able to make a decision on the compensability of the claim. All of this should be accomplished within the first 14 days the claim file is open.

 

 

Category 5 – Average Weekly Wage and Benefits:

 

To earn points in this category, the adjuster should obtain from the employer the wage records or wage documentation on the proper state approved form. It is not acceptable for the adjuster to take the hourly rate off the Employer’s First Report of Injury form and estimate the average weekly wage. The weekly wage and the calculation of the indemnity benefit should be clearly documented in the adjuster’s file. In addition to calculation of the indemnity benefits with proper documentation of the wages, if owed, they are issued timely. Also, all medical bills are reviewed and paid timely.

 

 

Category 6 – Reserves:

 

The initial file reserve should be set by the adjuster within 72 hours of the file receipt, but after completion of the three contacts – employer, employee and medical provider. After the adjuster has obtained the initial medical records, within 60 days of file receipt, the reserves should be reviewed for accuracy. Throughout the course of the file the receipt of any information, medical or otherwise, that would impact the files, the reserves should be updated. On severe claims that remain open for an extended period of time, the adjuster should review the reserves every 6 months to verify their accuracy.

 

 

Category 7 – On-Going Contact:

 

A mistake that many adjusters make is not staying in contact with the employee, the employer and the medical provider. Consistent and on-going contact with the employee will maintain rapport with employee and eliminate many of the reasons that could delay the progress of the claim. The adjuster should maintain the file on diary to ensure all on-going contacts and necessary follow-up is completed. If the adjuster stays in contact with the employee at least monthly until the claim is resolved, and stays in contact with the employer and medical provider as needed, award all 10 points in this category.

 

 

Category 8 – Medical Management:

 

When the adjuster makes the initial medical provider contact, medical management begins. In the initial contact the adjuster should learn the diagnosis, prognosis, the treatment plan and the return to work status. The adjuster should coordinate with the employer and the medical provider to allow the employee to return to work on modified duty as soon as possible. If the injury is severe enough, the adjuster should provide the medical provider with the information on utilization review and pre-certification, plus a nurse case manager should be assigned to the claim timely. If a medical bill review service is used to audit medical bills, the adjuster should ensure all medical bills are sent to the appropriate audit vendor for review and processing.

 

Important note: To grade this portion of the score, have an MD review the file to make sure the injury is, in fact, work-related. Also analyze whether all medical reports are in the file, that complex medical language is recognized, and that medical care is appropriate, e.g. that nurse case management made a difference in the file and did not simply replace duties an adjuster should be doing. My view is that the best qualified person to review a medical file is a DOCTOR. Use TPAs that have appropriate MD resources for services such as peer-to-peer. If the nature of a claim is unrecognized or inappropriate, it won’t matter how many administrative details are done well, because the claim shouldn’t have been paid in the first place. Keep this in mind.

 

 

Category 9 – Litigation Management:

 

Any time a workers’ compensation board hearing or a court hearing is requested by the attorney for the employee, a prompt referral to pre-approved defense counsel should be done. The initial referral to defense counsel should outline the status of the claim, request a litigation budget and provide instructions to defense counsel on how the adjuster wants defense counsel to proceed. (If the adjuster does not instruct counsel on what the adjuster wants done, deduct at least 5 points in this category). The adjuster should continue to provide on-going instructions to counsel throughout the course of the claim.

 

 

Category 10 – File Documentation:

 

Every activity completed by the adjuster should have a clear, concise file note stating what was done and how it impacts the claim. All medical reports, reports from defense counsel and any other file development should be outlined in the file notes.

 

 

Bonus Points:

 

Occasionally, their will be other important activity in the file that is not included in the 10 categories noted above. For instance, the adjuster’s pursuit of subrogation to recover the cost of the claim deserves 5 or 10 bonus points based on your evaluation of how much extra effort the adjuster put forth to recover the subrogation.

 

Another area for consideration for bonus points would subsequent injury funds or other offsets. Any effort made by the adjuster to mitigate the cost of the claim should be recognizes by the award of bonus points.

 

 

Overall Grade:

 

Tally the number of points (from zero to ten) you gave the adjuster in each category. Compile the scores from all the claim files you review. Using the A, B, C, D and F grading system you had in school, does your adjuster deserve an “A”? If not, what category/area(s) did the adjuster consistently fail to earn all ten points? Identify the weak areas and ask your adjuster to strive to comply with your Best Practices in those areas. Some TPA’s grade their own adjusters; this can be valuable information for you to learn.

 

 

 

Michael Stack - AmaxxAuthor Michael Stack, CEO Amaxx LLC. He is an expert in workers compensation cost containment systems and helps employers reduce their work comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is founder & lead trainer of Amaxx Workers’ Comp Training Center. .

 

Contact: mstack@reduceyourworkerscomp.com.

Workers’ Comp Roundup Blog: http://blog.reduceyourworkerscomp.com/

 

©2017 Amaxx LLC. All rights reserved under International Copyright Law.

 

Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional.

Poor Workers’ Comp Claims Handling Costs You Money

Each year you receive your bill for the next workers compensation policy year, and for many of companies, each year the bill is higher than the previous year. As you think about your work comp claims, you realize the claims for the current year were not any worse than they were for last year, or the year before. So why does your workers’ compensation premium bill keep going up and up?

 

When the underwriter at the insurer looks at calculating your premium, they use what is known as an experience modification factor. This factor is a calculation used to raise or lower your premium based on the loss experience your company has had. If the loss experience has improved, the premium charged to your company goes down. If you have had more claims than before or the claim cost has gone up, your premiums go up.

 

The loss experience is based on two factors, frequency and severity. The insurance company does not control frequency of claims, your company controls frequency through how well you manage the safety program. As you think back to the previous years, you think “wait a minute, our safety program is working, the number of claims has declined, so why has my premium gone up?” The answer is the other part of the experience modification factor – the severity of the claims.

 

 

Claim Cost Not Discounted Due to Poor Handling

 

There is one thing your insurance broker and your workers compensation insurer will never tell you about the cost of your workers compensation premium. If they do a poor job handling the claims, and spend more money than necessary due to a failure to properly investigate or to return the employees to work, you get to pay for their incompetence. The underwriting department does not discount the severity factor because the claims office did a poor job.

 

If your next thought is: “I’m no expert on how to handle work comp claims, so how would I know if the claims office is doing a good job?  There are ways you as the employer can gauge the effectiveness of the claims office.

 

 

Report Claim Immediately

 

The first thing the employer can do to reduce the severity of the claims is to report them to the claims office immediately. There have been numerous studies that show the longer the delay between the time of the accident and the adjuster contacting the employee, the higher the overall cost of the claim. By reporting the claim to the claims office immediately, you have reduced the amount of time between the accident and the adjuster contacting the employee.

 

Normally when the adjuster contacts the employee, the adjuster also contacts the employee’s supervisor or manager to verify the facts of the accident. If you have a claims coordinator, have the claims coordinator keep track as to when your company hears back from the work comp adjuster. If you do not have a claims coordinator, have the person who reported the claim to the claims office keep track of when you initially hear back from the adjuster. Same day contact from the claims adjuster is best, next day contact is acceptable.

 

 

Sign Adjuster Not Investigating Claims 

 

If your thought is: “We never hear from the adjuster after we report the accident,” that is a major sign that the adjuster is not investigating the claims. If the adjuster is not properly investigating the claims, you as the employer pay for it in your experience modification factor when claims that should be denied are paid, or claims that are fraudulent are paid.

 

There is a sure-fire way the employer can know if the adjuster was in contact with the employee the day the claim was reported to the claims office (or at least the next day). Pick up the telephone and call the employee. Ask the employee how the initial doctors office visit went and what the doctor thinks the employee’s prognosis will be. Then an “oh, by the way, have you heard from the insurance adjuster yet?” will quickly tell you if the adjuster has made timely contact with the employee. Do this on ten claims in a row and you will soon know if the adjuster is giving your claims the proper initial claims handling. [Bonus – by contacting the employee you show the employee that the employer does care about their well being, which builds rapport with the employee, and diminishes the chances of the employee hiring an attorney].

 

 

Lowest Price Often Precludes Service

 

Another definite tip-off that the adjuster is or is not handling the claims properly is when the adjuster calls your office trying to arrange modified duty so the employee can return to work.  If in the initial contact from the adjuster you are asked what light duty assignment you can provide the employee, you have an adjuster who is thinking about how to get the employee back to work, which lowers the amount of indemnity payments and the overall cost (severity) of the claim. A good adjuster will continue to explore light duty return to work until the employee is back at work. A poor adjuster will never ask about light duty return to work and will just pay the employee indemnity benefits until the doctor states the employee is fully recovered. When you bargain for lower-priced TPA or insurance claims adjusting services, consider that you want the adjusters to have the resources to DO this work, and offering the lowest possible price may preclude that  – no matter what they say at the official presentation.

 

An easy way to get your work comp adjuster(s) on the ball in their claim handling is to ask for a copy of their service standards (Best Practices) for workers compensation. Advise the adjuster(s) that you will be reviewing your files to see if they are complying with the Best Practices. If by chance you are told they do not have a set of service standards, it is time for you to talk to your broker about finding another insurance company who is concerned about doing a quality claims handling job.

 

 

Michael Stack - AmaxxAuthor Michael Stack, CEO Amaxx LLC. He is an expert in workers compensation cost containment systems and helps employers reduce their work comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is founder & lead trainer of Amaxx Workers’ Comp Training Center. .

 

Contact: mstack@reduceyourworkerscomp.com.

Workers’ Comp Roundup Blog: http://blog.reduceyourworkerscomp.com/

 

©2017 Amaxx LLC. All rights reserved under International Copyright Law.

 

Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional.

Medicaid Recovery Rights – What You Need to Know

It’s been characterized as “almost unintelligible to the uninitiated,”  and it’s about to further complicate things in the workers’ compensation system. As of October 1, state Medicaid programs are allowed to assert a full recovery against all amounts paid to a claimant.

 

We can most likely expect states to ramp up their reimbursement efforts for affected workers’ compensation claims. It means if you haven’t paid much attention to Medicaid’s secondary payer recovery rights, it’s time to start.

 

 

Medicaid

 

Similar to Medicare, Medicaid provides healthcare to certain Americans. But unlike Medicare, Medicaid involves both the federal and state governments — think workers’ compensation with some federal oversight.

 

Here are some of the specifics of Medicaid:

 

  • Expansion. It was created by Congress to provide healthcare to the disabled and those living in poverty, but was expanded under the Patient Protection and Affordable Care Act. Just about anyone under 65 who has a household income under 133 percent of the federal poverty level is now eligible.
  • Quasi-federal/state program. States administer eligibility and claims processing functions, while the federal Centers for Medicare & Medicaid Services (CMS) oversees state compliance with federal Medicaid rules.
  • Voluntary. The voluntary program allows states to determine how to address the needs of their own populations; but they must adhere to rules established by CMS in order to receive some federal funding for the program.
  • Needs based. Unlike Medicare, which is an entitlement program generally available to anyone over 65 and/or disabled, Medicaid is based on a person’s income level.

 

 

Secondary payer

 

Like Medicare, Medicaid is designed to be the payer of last resort and its interests are supposed to be considered in settlements. However, court decisions over the years have limited reimbursement to only the amount designated for medical care, something not typically identified in workers’ compensation claims. That’s made it more difficult for states to go after settlement money. Until now.

 

The October 1 change allows Medicaid programs to go after the entire settlement of program beneficiaries. Just as Medicare has the right to recover conditional payments made from settlement amounts, Medicaid will likewise impact claims resolution. In fact, one of the federal government’s Medicaid requirements has been for states to seek reimbursement from third party sources. The October 1 change simplified that process — at least, for Medicaid agencies.

 

 

Workers’ Compensation

 

Because Medicaid programs are administered by states, every jurisdiction has a different set of laws and regulations — similar to workers’ compensation; and Medicaid recovery rules also vary from state to state. That fact complicates the situation for employers that operate in multiple states, as they try to determine Medicaid’s rights of recovery.

 

What the change will mean for workers’ compensation is something of a mystery at this point, at least in terms of the specific steps to consider Medicaid’s interests in settlements. Many questions need to be answered, such as reporting requirements, compliance and repayment.

 

One issue that further complicates things is the fact that recovery for Medicare and Medicaid are not mutually exclusive; each must be considered at settlement. Estimates are that roughly 20 percent of Medicare beneficiaries also collect benefits from Medicaid programs.

 

In anticipation of the rule change, states began the process of implementing strategies to identify Medicaid beneficiaries who receive workers’ compensation. Many state Medicaid agencies have implemented reporting requirements through data exchange programs and registries.

 

Rhode Island, for example, established the Medical Assistance Intercept System and requires all insurers operating in the state to participate. The program electronically matches Medicaid recipients with liability and workers’ compensation insurance claims. It is designed to intercept payments of $500 or more for reimbursement to the state’s Medicaid program.

 

 

What to Do

 

  1. Proactively monitor developments. Watch for CMS guidance, for example to understand how best to comply with reporting requirements and compliance.
  2. Understand state laws. It’s important to stay abreast of Medicaid recovery statutes and case law in each jurisdiction in which you do business, since each one has a unique system.
  3. Identify Medicaid beneficiaries and those who will be, among your claimants, and report them to your state’s Medicaid agency.
  4. Don’t forget Medicare. The rule change for Medicaid has no bearing on Medicare, so procedures for considering its interests should remain the same.
  5. Carefully read any correspondence you receive from CMS and/or state Medicaid agencies.
  6. Adopt best practices. Work with your attorney(s), carrier and claims managers to develop a plan to consider Medicaid’s interests in claims.

 

 

Conclusion

 

Medicaid has always been a payer of last resort when other sources of funding are involved. The change in language as of October 1 will likely lead states to become more aggressive in seeking recovery in claims involving Medicaid beneficiaries. It’s important to stay up to date on the very latest developments to ensure you are in full compliance.

 

 

 

Michael Stack - AmaxxAuthor Michael Stack, CEO Amaxx LLC. He is an expert in workers compensation cost containment systems and helps employers reduce their work comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is founder & lead trainer of Amaxx Workers’ Comp Training Center. .

 

Contact: mstack@reduceyourworkerscomp.com.

Workers’ Comp Roundup Blog: http://blog.reduceyourworkerscomp.com/

 

©2017 Amaxx LLC. All rights reserved under International Copyright Law.

 

Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional.

Selecting the Relationship to Make or Break Your Workers’ Comp Program

 

What do you call the person who graduates at the very bottom of his class in medical school? That question was posed to me by a friend of mine in college, particularly after he didn’t do so well on one of his exams. But he would say Mike, you call that person doctor.

 

 

All Doctors Are Not Created Equal

 

Hello, I’m Michael Stack, CEO of AMAXX and while it’s somewhat of a funny question, the answer is one 100% true. It doesn’t mean that I want to go see that doctor, doesn’t mean that you want to go see that doctor, it doesn’t mean that you want your injured employees to go see that doctor either. There’s a common misconception, particularly among American consumers, that all doctors are created equal. We know with complete certainty that that statement is just not true. The message and the doctors that you’re working with can make or break the success of your work comp program. While there are some states that are employer directed states, other states that are employee directed states, and even now there’s others that are a blend of the two. You need to have this physician relationship that can help drive the success of your program. Drive the success of your return to work program and create those better outcomes for your injured workers, thus costing you significantly less in work comp costs.

 

 

Characteristics of Ideal Company Physician

 

I want to go over some of the characteristics that you want to be looking for in that company physician relationship and also some of the ones that if you currently have them, that you need to think about getting a new physician relationship. Let’s talk about what these characteristics are. First you want that physician to be responsive. You want him or her to be caring, willing to spend extra time with your injured employees, with some of the additional paperwork that’s required in work comp, and of course, you want that person to be highly qualified and versed in the best practices of evidence-based medicine.

 

 

Let’s unravel these a little bit. Talk about the extra time that’s required in Workers’ Comp as compared to group health. There’s some physicians that are just not interested in that. You need to find the ones that are. You need to find the ones that are specialized in occupational medicine and willing to have this responsive and caring attitude towards your injured workers. We know how important trust is, in order to predict the outcome for your injured workers. That’s true with the employer’s site, that’s true at the medical provider level as well. You want that doctor to be able to come out to your employer site. Hold a health fair. Get to know your employees. Build that relationship, build that trust, and also understand those job descriptions.

 

What are the functional requirements of the job, so when that employee goes to see that physician, you can get those medical restrictions and you can make them very specific in order to feed that person right into your transitional duty program, which is so key to the success in the recovery of that injured worker.

 

 

What NOT to Look for in Company Physician

 

Let’s talk about the other side of this coin. One caution that I often see. If you get this highly qualified doctor, well versed in evidence-based medicine, big reputation in the industry, you’re often also going to get an arrogance from that particular doctor. That person will be unresponsive because him or her will have no time and no interest in working with you in your program, providing you the restrictions. Filling out your workability forms, feeding into your return-to-work program and just unwilling to come out to get to know your employees and your organization. It’s such a symptom of this arrogance. They also may have a biased approach and be inflexible in being creative in getting those restrictions and helping your employees get back to work in a timely fashion.

 

This type of physician, and this bias is also a big one, either from the employee side or the employer side as well, because this is how you get the reputation of, “Oh, I’ve got to go see the company doctor and I’m just not going to be treated fairly.” You’ve got that going against you right out of the gate. But if you have that doctor that has that caring attitude, is willing to spend that extra time, you are going to be putting your program on the path to work comp success.

 

Again, I’m Michael Stack, CEO of AMAXX. Remember your work today, and Workers’ Compensation can have a dramatic impact on your company’s bottom line, but it will have a dramatic impact on someone’s life. Be great.

 

 

Michael Stack - AmaxxAuthor Michael Stack, CEO Amaxx LLC. He is an expert in workers compensation cost containment systems and helps employers reduce their work comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is founder & lead trainer of Amaxx Workers’ Comp Training Center. .

 

Contact: mstack@reduceyourworkerscomp.com.

Workers’ Comp Roundup Blog: http://blog.reduceyourworkerscomp.com/

 

©2017 Amaxx LLC. All rights reserved under International Copyright Law.

 

Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional.

Professional Development Resource

Learn How to Reduce Workers Comp Costs 20% to 50%"Workers Compensation Management Program: Reduce Costs 20% to 50%"
Lower your workers compensation expense by using the
guidebook from Advisen and the Workers Comp Resource Center.
Perfect for promotional distribution by brokers and agents!
Learn More

Please don't print this Website

Unnecessary printing not only means unnecessary cost of paper and inks, but also avoidable environmental impact on producing and shipping these supplies. Reducing printing can make a small but a significant impact.

Instead use the PDF download option, provided on the page you tried to print.

Powered by "Unprintable Blog" for Wordpress - www.greencp.de