Thursday, May 26, 2011

Controlling Costs by Controlling Expectations

A panel at the Northern California Workers' Compensation Forum yesterday (see WorkCompCentral News story "Panelists Agree on Controlling Costs by Controlling Docs" agreed that the use of medical networks and other tools to control doctors helps in controlling overall work comp claim costs. And at least one panelist argued that utilization review has done more to increase costs than control them.

But one main ingredient to controlling costs seems to be always missing from the conversation - controlling the expectations of the injured worker.

I've always been impressed with a statement by President Obama’s then budget director, Peter Orszag, addressing lawmakers in economic meeting on 2/23/09, “To my fellow budget hawks in this room and in the rest of the country, let me be very clear: Health care reform is entitlement reform.”

Indeed, I'd argue accordingly that the way to control medical costs in workers' compensation is to reform the expectations of the injured worker - entitlement reform.

Here is a recent example of controlling costs, albeit in the general health scenario. My mother-in-law, 82 years old, fell when she got dizzy because her blood pressure was too low on account of overzealous medication. She received a nasty gash on her arm. When my wife and I saw her she appeared to be fine - yes, big cut on her forearm but otherwise no signs of any other trauma or cause for concern.

Mom, though, likes attention and was pleased to receive a plethora of tests from an EKG to a scan of her brain from doctors that were more than willing to run up the diagnostic check list due to Mom's history of injury (she got dizzy and fell) that had nothing to do with the real emergency, ergo a cut on the arm.

Yep, the doctors would claim that they wanted to take all necessary precautions to ensure nothing was missed during this visit, and of course nothing was missed - there were no anomalies found after 6 hours and thousands of dollars of diagnostics. 

Yet it was quite obvious just from a physical inspection and talking with my mother-in-law that there was nothing wrong other than the cut on her arm.

Had Mom been told from the outset by doctors a) without a profit motive and b) unafraid of the minuscule possibility of tort liability (California has a high threshold before a doc can be sued) that physically she looked okay, mentally she sounded okay, and had been given a truly informed option on all these tests (i.e. they could be performed but likely to turn up nothing because she looked and sounded fine), she could have gotten out of ER in just an hour and saved her medical insurance company thousands of dollars.

The same goes in work comp. Doctors are too often quite eager to order tests, perform surgery, and conduct expensive medicine, when a good solid discussion of the non-medical alternatives would do more to help the injured worker than  all of the medicine in the world.

Control the expectations of the injured worker and you control medical costs. 

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