Medical Provider Performance Indicators for Workers Compensation

By Karen Wolfe, BSN. MA, MBA
President, CEO
MedMetrics, LLC

Workers' Comp is Different
While rating providers in group health is a long-practiced endeavor, its elements and parameters have not significantly migrated to workers compensation. Efforts to translate group health provider quality measures to workers’ compensation have fallen short of the mark because they omit several factors crucial to workers’ comp. Quality medical performance indicators in workers’ comp encompass medical treatment, outcome, and cost factors similar to those in general health, but they also include non-medical functions. In workers comp, those non-medical elements can be primary drivers of cost, quality, and outcome.

Return to Work: An Indicator of Performance
A major quality goal in workers' comp is return to full work. Responsibility for achieving that goal rests with the treating physician. Another major quality goal in workers’ comp is return to maximum or full work capacity at the least cost. This article explores the many non-medical functions of treatment that spell quality in workers’ compensation, factors that must be considered in rating doctors’ performance.[WCx]

For instance, multiple and repeated studies have shown that early return to work is a major indicator of better outcomes in workers comp. (Google search:  “Return to Work studies in workers’ compensation.”) The overwhelming take-away from these studies is that the sooner employees return to work after a work-related injury, the sooner they are re-acclimated to the job and the lower the overall cost of the claim. Alternatively, the longer the employee is kept off work, the higher the cost of the claim, with reduced chance of successfully returning to work. Studies show a 1:1 correlation between length of time off work and returning to work — ever. Treating providers are the major driver in returning claimants to work. Therefore, early return to work and reduced overall work loss are key indicators for evaluating medical provider performance.

Cost Measures of Performance
Also important to rating provider performance in workers’ compensation is the issue of cost. Two quantifiable generators of unnecessary costs are frequency and duration of medical treatment. Because PPO, MCO, and MPN networks discount each unit of service delivered, the tendency of some providers is to exploit both frequency and duration of treatment to overcome their discounted fees. Individual provider’s frequency and duration of medical treatment for specific injury types should be measured and compared with the performance of their peers treating similar injuries.

Another comparative quality indicator is direct medical costs. Billed costs are not a true performance indicator by themselves. However, assessing billed costs with paid amounts or percentage reduction of charges recommended by bill review is a more accurate measure.

Prescriptive Practices
Recent research indicates a problem of opioid misuse or abuse in workers comp. Evaluate prescribing practices of individual physicians by monitoring current data, thereby creating an opportunity to intervene. Prescribing practices are a valid indicator in measuring performance.

Of critical importance is evaluating providers in terms of outcome like how did things turn out in the claims where they were involved? Is the employee back at work, permanently disabled or somewhere in between? What is the provider’s record? If a provider is associated with a high rate of litigated claims, that should also be considered in the descriptive mix.

Create Algorithms to Measure
Providers can be rated specifically for workers' comp by creating a set of algorithms measuring these factors using data. An algorithm is simply a defined process, often mathematical, used to solve a problem or reach a conclusion. Algorithms should be used to compare similar types of providers who have treated like injuries in the same jurisdiction during the same time frame. Consistency is achieved because the computerized algorithms apply the same standards to all medical providers who meet a set of conditions.

Analyze Data from Multiple Sources
The data used to evaluate provider performance should be derived from more than one source. Raw billing data or bill review data should be integrated with claim data in order to reach a valid conclusion. Billing and treatment data must be integrated with loss time and outcome information, usually found in different systems, in order to reach legitimate conclusions regarding providers. 

Ratings for medical providers must be transparent, fair, and objective. Fairness and accuracy in developing and measuring provider performance is critical. The indicators can be found in the data. The data must be integrated and evaluated using computerized algorithms that measure and monitor provider performance based on a combination of workers’ compensation-specific values.[WCx]

Measuring Provider Performance Is a Good Thing
A post was submitted by Joe Paduda last year, “Like it or not, physician ratings are coming”. The title suggests rating doctors is a bad thing. It is actually a good thing, unless you are a poorly performing provider. Using legitimate workers comp-specific rating systems to provide objective evidence for selection and for weeding out the less effective or even fraudulent providers is positive progress. A poorly performing provider guarantees complexity and cost in the claim. Informed decisions about medical providers based on data will replace personal biases and unknown outcomes. Basing provider selection decisions on objective data is imperative.

Author Karen Wolfe, BSN, MA, MBA, is 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. MedMetrics uses several tools such as Predictive Intelligence Profiling and Medical Provider Performance Assessment to gather and analyze data. Contact: Phone: 541-390-1680;;






Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workers comp issues.


©2012 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact us at:

Eight GREAT Techniques to Control Workers Compensation Medical Costs

The cost of medical care is the largest part of the total cost of workers compensation. Finding ways to control and manage these medical costs is important to maintain and control workers compensation cost. There are numerous techniques to use to control medical costs.
Let us look at the ones providing the most benefit to the employer:
1. Nurse Case Managers
The most important person in the control of workers comp medical costs is the Nurse Case Manager (NCM). The NCM is responsible for planning and coordinating medical care to assist the employee in returning to work as soon as physically able or when the employee reaches the maximum medical improvement (MMI). The NCM role can either be in the office handling most communications by telephone — a telephonic case manager (TCM); or the nurse can spend most of her (or his) time away from the office — a field case manager (FCM) who attends medical appointments with the injured employee.   (WCxKit)
Whether the nurse is referred to as a NCM, TCM, or FCM, the role is to make sure the employee receives all necessary medical care as quickly as possible. The responsibilities of the NCM include:

1.      Consulting with the medical providers on the best options for treating the employee.

2.      Coordinating the medical care between the different medical providers.

3.      Preventing the over utilization of medical care while ensuring the employee receives all needed care.

4.      Acting as a liaison between the employee, employer, physician, therapist, insurer, and other parties.

5.      Facilitating the communications between the employee, employer, and adjuster.

6.      Arranging the employee's return to work either in modified duty with the necessary accommodations or full duty without any accommodations.

7.      Keeping the adjuster and employer informed as to the employee's medical status.

2. Medical Provider Networks
When various medical providers including doctors, hospitals, physical therapists, and others join together for the purpose of providing medical care to a specific group (employees), a medical provider network is formed. In exchange for sending all injured employees to the medical provider network, the employers or insurers receive a group discount on the cost of medical care. California and Texas are the two biggest states where medical provider networks are utilized to control the cost of workers compensation. Follow the rules exactly, and you can direct care for the life of the claim in California. In California, these are called MPNs.
3. Medical Triage
Medical triage is the process of having a trained nurse arrange the medical care for any employee who reports an injury. The triage nurse coordinates the medical care for the employee, arranges for the initial medical visit and any follow up visit, and advises the adjuster on the nature of the injury and the type of initial care received by the employee. Approximately 40% of your claims will be "self care" claims, which means you'll have 40% fewer claims, many of which would have ultimately become lost time claims. It's a way to stay on the claim from Day 1. Nurse triage can even direct the employee (and supervisor) to the nearest PPO in your network – if allowed by state law.
4. Utilization Reviews
Utilization review is the review of medical care by another party other than the medical provider to ensure the appropriateness of the medical care. There are three types of utilization review.

1.      Pre-certification: the requested medical service whether hospitalization, surgery or diagnostic testing, is reviewed by a trained nurse or doctor, to verify it is the best medical approach for the injured employee's medical care, before the medical care is provided.

2.      Concurrent reviews: occurs when the employee is in the hospital is having any other medical care that takes enough time for the medical necessity to be checked before it is completed.

3.      Retrospective reviews: verifies the need for medical services already provided.

5. Medical Fee Schedules
In an effort to control medical costs, most states place a dollar cap on each type of medical service an employee can receive following an injury. A medical bill review company compares all medical bills submitted against the fee schedule to insure only appropriate services are billed and billed for the correct amount. Most states have their own fee schedules – which is generally a very large, complex list (like a phone book) of codes for each injury/illness and treatment.
6. Pharmacy Benefit Managers
Pharmacy benefit managers (PBM) specialize in providing the employee with needed prescription medications. The PBM arranges for the employee to obtain prescriptions at drug stores within the network, or provides to the employee, by mail, any maintenance medications the employee will take over an extended period of time. PBMs can help control the overuse of prescription medication and curb opioid abuse.
7. Medical Panels
Several states allow the employer to designate a list of medical providers the employee can select from when the employee is injured. This panel of doctors includes a variety of medical specialties and/or medical facilities. The medical panel is normally posted at the employee's work site for the employee to chose from. This is sort of a blend between employee selects their own provider and employer selects the provider. Which ever state/s you are in make sure you know how medical provider selection is done.
8. Independent Medical Evaluations (IME)
An independent medical examination is a second opinion from a doctor selected by the insurance company to confirm the diagnosis and treatment of the employee. It can also be used to verify the disability or impairment of an employee when the employee finishes medical care. (WCxKit)  Have an MD write the IME cover letter and point out to the IME doctor relevant causation issues and/or mechanism of injury issues that make be disproportionate to the injury. Why get an IME if it's not going to be preceded/set up with an effective cover letter?
These 8 approaches are not the only ways to control medical costs in your workers compensation claims. There are various other techniques that can be used to limit medical costs and additional approaches are being developed as more and more employers look for ways to control these costs.

Author Rebecca Shafer
, JD, President of Amaxx Risks Solutions, Inc. is a national expert in the field of workers compensation. She is a writer, speaker, and website 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. See for more information. Contact: or 860-553-6604.
ABC's of Workers Compensation Cost Containment Book:
Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workers comp issues.
©2011 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact

California Medical Provider Networks

California allows the workers compensation insurers and self-insured employers to utilize a Medical Provider Network (MPN) for the treatment of on-the-job injuries and work-related illnesses. The MPN is an association or network of clinics, physicians, hospitals and other medical providers – under contract with the MPN – who treat workers compensation injuries and occupational illnesses.  The advantage of the MPN to the employer is the employee is treated by a medical provider who specializes in work-related injuries.
Some practitioners have noted with criticism
, however, that not all doctors in the network are well-qualified and further indicate that “almost  any physician who is willing to take a discount” can get on the panel; therefore, it is important for employers to make sure that the doctors in their networks understand workers compensation, know how to bill at the OMFS (official medical fee schedule), know how to write reports and return injured workers to modified work. Physicians who are not experienced in the nuances of workers compensation may also not know how to close a case appropriately: Released as Cured; Pre-Injury or Permanent & Stationary / MMI.


California MPNs 
are designed to provide services throughout the state. It is customary for the MPN to offer:

  1. A primary care physician within 15 miles or 30 minutes of the employee’s residence or job site.
  2. All other medical services within 30 miles or 60 minutes or the employee’s residence or job site.
  3. Emergency medical care services.
  4. Medical care in rural areas (they have alternative distance and time standards and, in some situations, allow out-of-network medical providers or non-contract medical providers).
  5. Medical care for the employee who is working or traveling outside of their home geographical area (but still within the State of California.)  (WCxKit)


It should also be noted 
that all physicians in or out of the MPN must follow the California Treatment Guidelines / Medical Treatment Utilization Schedule Reg. 9710.



The employer has the opportunity to direct the care for 30 days with or without an MPN, but the requirements must be strictly followed or the injured workers regains the right and ability to self procure his own medical provider at the end of 30 days; if the employer has followed the rules, they retain right to direct care for the life of the claim. Stated another way, if an employer has an MPN and did not follow the procedures at time of hire and again at time of injury they lose the right of control. The employer can direct care for the first visit and if they have complied with requirements for providing the employee with MPN information and a list of providers at the time of hire and again at the time of injury they have control for the life of the claim.  If the employee is unhappy with the choice of a physician, they can elect to change doctors but must stay within the MPN.

If the employee is unhappy
 with the diagnosis or the treatment they receive for their injury, they have the right to ask for a second opinion from another physician within the MPN. The employee is required to make an appointment within 60 days of requesting a second opinion. If the employee is unhappy with both their original doctor’s opinion and the second doctor’s opinion, they are entitled to a third opinion in California.



If the employee is unhappy
 with the first opinion, second opinion, and third opinion, the employee may file a request for an Independent Medical Review (IMR) with the California Division of Workers Compensation administrative director. The administrative director will assign an independent medical reviewer. The independent medical reviewer will conduct either a physical examination or a medical-records review. If the independent medical reviewer agrees with the employee, the employee can select a physician who does not have to be a part of the MPN. In this case, the employer/insurer is responsible for the medical care cost. The injured worker can request a “QME” (Qualified Medical Examination) and will be provided a panel of 3 to choose from in a given specialty or specialties.



Most MPNs
 will offer medical management in which a nurse case manager will work with the employee, the employer, and medical providers to get the employee back to work as quickly as feasible. Some MPNs also offer a vocational specialist who works with the employee to retrain them for another occupation when they are physically unable to return to their prior job.



An insurance company
 or self-insured employer can create their own MPN or join one of the MPNs that have already been established. The benefits to the employer who joins a MPN include:

  1. Lower medical cost– The MPN contracts with the medical providers for the cost of the medical fees which are lower than the Medical Fee Schedule used in California. On average the medical fees are approximately 10 percent lower through a MPN.
  2. Medical control throughout the claim – When an employer has a MPN and complied with the requirements, the employee must treat within the MPN throughout the life of the claim (with certain exceptions, see above) unless the employee has pre-designated their primary treating physician (the large majority do not). Employers need to make sure this information is provided to all new hires, at the time of hire. They need to be able to document compliance.
  3. Elimination of chiropractors and acupuncturists: if the employer has a MPN, the employee can only pre-designate a medical doctor or doctor of osteopath. Without a MPN, the employee can pre-designate their chiropractor or acupuncturist. However, the injured worker can under 4601 request chiropractic care or acupuncture within the MPN. If the MPN has no panel chiropractors or acupuncturists within the given geographic distance they can choose one outside the MPN.



Medical Provider Networks provide medical cost control. The long term impact for the employer is lower overall cost of workers compensation insurance. We recommend for all California employers have a Medical Provider Network, or be affiliate with an insurance company that has one, and make sure you are in compliance with the rules.

Author Rebecca Shafer
, JD, President of Amaxx Risks Solutions, Inc. is a national expert in the field of workers compensation. She is a writer, speaker, and website 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. See for more information. Contact:







SUBSCRIBE: Workers Comp Resource Center Newsletter


Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workers comp issues.


©2011 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact


Washington State Bill for Medical Provider Network

Washington State Gov. Chris Gregoire has signed into law a bill that orders the states Department of Labor and Industries to form a statewide medical provider network for injured workers.
The new law will reportedly trim $218 million in spending over four years from Washingtons monopoly workers compensation system by forming a network of doctors who meet a number of standards and apply best practices. (WCxKit)
Additionally, the law allows injured workers to choose their doctor within the network and calls for formulating an electronic system to track “evidence-based quality measures and outcomes,” according to a statement.
We know we need to help more workers return to good health and back on the job after an injury, as well as reduce costs for our taxpayers and businesses,” Gov. Gregoire remarked in the statement.
Author Robert Elliott, executive vice president, Amaxx Risks Solutions, Inc. has worked successfully for 20 years with many industries to reduce Workers Compensation costs, including airlines, healthcare, printing/publishing, pharmaceuticals, retail, hospitality and manufacturing. See for more information. or 860-553-6604.
Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workers comp issues.
©2011 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact

Employers Turning to Medical Provider Networks To Control Selection of Doctors Treating Their Workers

In Texas and California, the workers’ compensation insurers, governmental pools and self-insured employers are turning to medical provider networks (MPN) to control the selection of doctors when an employee is injured on the job.   A MPN is a group of health care providers approved by the state’s Division of Workers’ Compensation to provide medical care to employees who suffer an on-the-job injury.


The employee is still allowed to select the primary medical provider for the occupational injury, but the employee is required to select from the medical providers within the MPN. This affords the employer/insurer some control of the medical cost of the workers’ comp claim and allows the employer/insurer to influence the medical direction of the workers’ comp claim. (WCxKitz)

  •       Burn care
  •       Cardiology
  •       Chiropractic
  •       Dental
  •       Dermatology
  •       General Surgery
  •       Hand Surgery
  •       Hematology
  •       Internal Medicine
  •       Neurology
  •       Neurosurgery
  •       Oncology
  •       Ophthalmology
  •       Orthopedic Surgery
  •       Orthopedics
  •       Pain Management
  •       Physical/Medical Rehabilitation
  •       Podiatry (WCxKitz)
  •       Primary Treating Physicians
  •       Psychiatry
  •       Psychology
  •       Rheumatology
  •      Sports Medicine
  •      Toxicology
  •      Urology

In addition to the medical specialties, the MPN will normally also contain the ancillary services of:

  •     Acupuncture
  •     Occupational Therapy
  •     Physical Therapy

There are various established MPN in both Texas and California an employer or insurer can join. Also, employers and insurers has the option of creating their own MPN. If the employer or insurer does elect to create their own MPN, it must be submitted to the state Division of Workers’ Compensation for review and approval before it can be utilized. Due to the cost in creating your own MPN, most employers elect to join an existing MPN.


The MPN should be large enough that the injured employee has the opportunity for a second opinion or even a third opinion if the injured employee is unsatisfied with the medical care being provided or disagrees with the medical diagnosis. (WCxKitz)


One of the issues the employer face with a MPN is verifying the MPN has the necessary medical providers [enough to cover second and third opinions] available in their geographical area. This may not be a problem in the large metropolitan areas, but definitely becomes an issue in the rural areas. There simply may not be all the medical specialties needed in the rural areas. Before an employer joins a MPN, the geographic coverage by county and specialty should be reviewed.


When an employer  joins a MPN, the employer should provide to all current employees and all future new hires a MPN employee handbook [in English or Spanish, per the employee’s preference] outlining the requirements of the program. The employer should also post at each work site a listing of the local medical providers within the MPN.


When an injury does occur, the employer should direct the injured employee to the occupational clinic (or hospital for more serious injuries) list on the MPN poster. It is also a good idea to provide the injured employee another copy of the MPN employee handbook immediately following the emergency clinic treatment or when the employee requests medical care in a non-emergency situation. (WCxKitz)


The MPN should be integrated with the utilization management and disability management programs of the insurer or self-insured. This will insure the injured employee receives all necessary medical care while controlling the cost of the medical care.


Additionally, you want the medical providers in the MPN to be proactive in returning injured employees to work, either limited duty or full duty, as soon as the employee reaches the point in the medical recovery where the employee can return to work. (WCxKitz)


The MPN allows the employer to influence the cost and the direction of the medical care throughout the life of the claim. A properly utilized MPN can have a major impact on the cost of medical care and indemnity benefits of your workers’ compensation claims.


Author Rebecca Shafer, Attorney/Consultant, President, Amaxx Risks Solutions, Inc. has worked successfully for 20 years with many industries to reduce Workers’ Compensation costs, including airlines, healthcare, printing/publishing, pharmaceuticals, retail, hospitality and manufacturing. Contact:  or 860-553-6604.

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Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workers’ comp issues.

©2010 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact


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