In other words, the folks that benefit the most from cost containment services are the folks that are charged with overseeing such utilization - the proverbial fox in the henhouse.
I heard from one claims insider that some companies, including the one she worked at, use utilization review as a cost containment system, rather than a treatment control system.
According to this lore, the philosophy is tied to quotas; claims adjusters are told that they are measured on denial volumes, the intent that a certain percentage of treatment requests essentially will just go away after a series of UR denials, and whatever is left over now goes to independent medical review.
IMR upholds the few UR denials three quarters of the time because either the request in fact fails to meet Medical Treatment Utilization Schedule protocol, records are incomplete, or requests aren't timely.
Again, I don't know if this is true, but this is what I'm hearing on the street.
|source WCIRB 6/26/2013|
Medical providers are telling me this is happening much more than is accounted for, and that they just get frustrated, as expected in the claims management philosophy outlined above, and consequently just give up.
I spoke at a conference few weeks ago to an audience that was, by my hand count estimate, comprised of about 75% claims adjusters. The vast majority of that part of the audience were "seasoned" claims professionals - they had been working the job for longer than 10 years.
I noted in part of my presentation that it seemed to me that in many claims departments adjuster discretion had been taken away and that there were policies in place at many claims houses mandating that ALL treatment requests, except emergency requests, be sent to UR.
I thought I would get challenged on that statement.
Instead I watched all of the heads in the room nod up and down in agreement and several came up to me later and confirmed my observation.
I hear anecdotes all the time from injured workers and physicians about benign treatment requests going through formal UR processes prior to approval, if there is approval, sometimes for several passes (remember in California that the first UR must be appealed to UR a second time, then it can go to IMR, and then IMR again...).
I hope this isn't true, but I suspect that this kind of nefarious claims behavior is more prevalent than I want to believe. I suspect that there are indeed some bad apples in the claims world that are not only using UR as an additional profit center, but also using UR to deny reasonable treatment requests in order to control medical treatment costs, rather than curtail inappropriate medical vendor activity.
I also suspect that there are plenty of good actors out there where the claims adjuster actually is the first UR line, and takes appropriate action rather than using the system to benefit a claim company's net profit.
But here's what happens to an industry with just a few bad apples infecting the fruit bowl - the entire bowl gets cleaned up and regulated.
Cost containment, at least in California, and I suspect in many other states too, is not transparent whatsoever. We don't know who owns what UR company. We don't know what company has quotas. We don't know if there is systemic denial of reasonable treatment requests. We don't know if there are policies in place or the reasons for such policies that might be tied to net profit goals.
Remember that it wasn't until 2011 that the Workers' Compensation Insurance Rating Bureau started breaking out cost containment services from the overall medical treatment expense numbers - the first step in transparency.
Now I think such transparency needs to go further, because, unfortunately, folks just can't be trusted.
Is is fraud? I don't know. But if these anecdotes are accurate, if there are quotas, if there are goals tied to treatment denial, if there are ownership conflicts of interest, then this is behavior that is not right because it is harmful to the system overall.
I wrote before that workers' compensation is a system based on mistrust, and this mistrust runs deep. Suspicions of conflicts of interest in the approval or denial of medical treatment requests serves to deepen this mistrust and harms the entire industry.
So there are a couple things that can be done.
First, of course, is for claims houses to come clean with their policies, procedures and ownership interests. The good apples will have no problem with this request. The bad apples will fight it.
Second is regulation, hate to say it. I hate more regulation, but bad apples bring it upon an entire industry.
Third is just plain peer pressure - if one company does the right thing and becomes transparent with its UR practices, and uses that as a market advantage, other companies will do so too. The ones that won't do so will either lose business, or will be forced to comply to stay in business.
Maybe I'm right. Hopefully I'm wrong. At some point someone in the governmental chain of oversight will want to take a look at this issue though in the least to put the public's mind at ease that either things are working just fine, or that the government is taking action to make sure the system will run fine.