30 AUGUST 2016 Claims Magazine PropertyCasualty360.com
The squeeze on workers’ com- pensation costs has been dra- matic, with medical benefits on lost-time claims tripling since
2003, according to the National Council
on Compensation Insurance (NCCI), a
U.S. rating and data collection bureau.
Informed claims management can help
ease the pressure. The use of data access
and standards provides structure that enables payors to better manage costs while
delivering improved service to injured
workers and their employers.
With informed claims management,
payors such as carriers, TPAs or self-insured companies, can tap into pooled
information and databases that are widely available and easily shared. They also
gain newfound access to data such as processed medical bills that many have gathered but had limited opportunities to use.
The advances are long overdue. Unlike
group health claims processing, which
has always had policy definitions and
benefit caps, workers’ comp has histori-
cally had few limitations. There has been
little structure for treatment requests and
care authorizations. Even worse, payors
have had few systems for measuring how
an injured worker’s treatment is progress-
ing against norms.
Aggressive pricing strategies and network optimization have helped drive
down medical costs per unit of service,
but without a system of checks and balances, medical benefits on lost time per
claim have risen from $9,000 in 2003 to
$28,500 in 2015, according to the NCCI.
Four approaches to
contain claims costs
The use of data and standards helps cre-
1. Adopt evidence-based
ate the checks and balances payors need
to provide quality service while contain-
ing costs. Here are four strategies to assist
companies in reaching that goal.
Adhering to treatment guidelines significantly lowers stakeholders’ costs and
closes cases faster, according to new research from Johns Hopkins University
and Accident Fund Holdings.
The researchers measured adherence to the Official Disability Guidelines (ODG) from the Work Loss Data
Institute and compared the outcomes
for different case mix adjusted claims
populations. Claims that had at least a 50
percent adherence to the guidelines had
13. 2 percent shorter durations and 37. 9
percent lower medical costs.
With its empiric support for the use of
evidence-based guidelines, the research
will likely fuel their continued adoption,
for Worker’s Comp Claims
By Chris Daniel and Ajoy Kumar Palanivelu