We participated in some interesting dialogue just recently, about Workers’ Comp costs. Workers’ Compensation has a cost problem that we’re all trying to patch up or put a band-aid on. Our efforts include implementing a pharmacy program, engaging with a bill review provider, aligning with a physical therapy network, discounting both DME (Durable Medical Equipment), diagnostics and maybe even psych treatment, all with the intent of creating SAVINGS. But there is a problem. Costs are still going up! We can all recognize that while a healthy managed care program SHOULD be leveraging all of the above, we’re not actually saving anything.
The Wrong Strategy
The strategy just described isn’t about savings at all. It is about controlling the pace of rising costs. How impactful is a short savings on DME that only accounts for a minuscule percentage of total claims cost?
What’s interesting is that most carriers have people tasked with the responsibility of implementing such programs. Those persons are emotionally and maybe even financially incentivized alongside of the “savings” that are created. The end result is that the industry ends up focused a whole lot more on THIS half of the equation and ignoring the other. Let's prove it by asking a few questions.
Who’s in charge of return to work spend?
Who’s in charge of the average duration of time it is taking specific claim types to get back to work? And what is the medical spend impact on those claims that aren’t performing well? Who’s in charge of analyzing and setting targets surrounding return to work duration by occupation or industry codes? How about the big one…..musculoskeletal vs. acute injury? What are the targets? How are we performing? What is the true cost? How is this aging workforce impacting duration? Or the obesity epidemic? What is happening in the claims process to flag these claims and set targets with the intent of being hyper focused on return to work success? What are you doing in the actual work environment to eliminate the root causes of musculoskeletal injury?
Time for a shift
Have you defined what a failed return to work scenario is?
Ugh, that’s a lot to consider. We know it. But folks, that is the OTHER HALF of the cost equation, and as an industry, we’re not answering any of it. We are hyper focused on a 5% diagnostics savings….probably a bit too much so.