In the World of Disability Management, Buyer Beware
We’ve seen just about everything in our 20 years as disability management specialists—including some disturbing trends. In his recent pull no punches blog, “How to Know if You’re Being Ripped Off,” Health Strategy Associates principal Joe Paduda provides his Top 10 signs that your work comp managed care provider might be ripping you off. We believe every self-insured company should be aware of this list but share it with you along with one significant caveat.
“If the ultimate goal is to safely return the injured workers to the job at the lowest cost to the employers then results are all that matter. When case managers do their jobs properly and manage each individual case with that key goal in mind versus measuring success by the number of hours billed, they achieve the best outcome as safely and economically as possible.”
In other words, when you partner with resources that measure success not by how much they can bill, but instead on how quickly and safely they can return the worker to the job, then Joe’s list become moot. However, it is definitely a two-way street and you must do your part as well. That means addressing an injury or illness immediately because when you do, everyone wins and your bottom line is the better for it.
Now for Joe’s list in descending order. Please note his caveat that not all TPAs are out to rip you off—we completely agree. But, be on the lookout for those who are.
How to know if you’re being ripped off
In the work comp managed care/claims world, some vendors’ revenue maximization efforts are getting ever more clever. I know, I know, I’ve posted on this several/numerous/multiple times before, but to my never-ending amazement, these practices continue. So here are the top ten warning signs to watch out for (sorry for ending with a preposition…)
Before you start, realize that all TPAs are not out to rip you off, all managed care vendors are certainly not either, and the soft market and unreasonable demands by employers have forced many claims administrators to look for revenue wherever they can get it.
That’s fine, as long as you know where your dollars are going…
10. Your TPA won’t let you use your own managed care vendors.
9. Your TPA won’t offer a bundled price, including all managed care services. Even worse if you never asked for one.
8. Savings reports focus on reductions below charges and don’t show reductions below fee schedule/UCR.
7. The TPA determines which cases ‘need’ case management - and your case management fees continue to grow. sometimes this appears to be OK, as the cost per hour is a deal, but it’s highly likely the hours worked are ever-increasing.
6. The TPA won’t sign any statement like this one (NOTE: See www.joepaduda.com for the referenced statement). Unfortunately, that doesn’t mean the TPA isn’t lying, as some may sign the statement anyway knowing it isn’t true.
5. The TPA won’t provide copies of any contracts with managed care vendors.
4. The TPA agrees to provide a great deal on claims admin services, with the fine print noting that they have complete control over managed care, investigative, legal, and other claims support services.
3. The TPA’s claims admin price is way, way better than the competition’s. There is no free lunch, and if the deal is too good to be true, rest assured you’re getting ripped off.
2. The claims staff you meet during the pre-implementation meetings disappears when claims come in, replaced by inexperienced/non-experienced/completely ignorant ’staff’
1. You are paying for bill review on a percentage-of-savings-below-charges basis, which motivates the vendor to find the highest-billing, highest-utilizing providers and let them run roughshod over your bank account, all the while trumpeting the ’savings.’
