Tuesday, October 11, 2011

Illinois Networks - A Chance to Provide Value

Efforts to give Illinois employers the right to direct the care of injured workers through preferred provider programs (PPPs), that state's version of medical networks, is moving forward through the regulatory process with hearings set later this month to debate proposed regulations.

House Bill 1698, the workers’ compensation reform measure passed by Illinois lawmakers this year and signed by Gov. Pat Quinn, allows the state's employers to use PPPs, subject to two basic requirements: The PPP must be approved by the Illinois Department of Insurance (DOI), and the Illinois Workers’ Compensation Commission must approve a notification form to be provided to an employee at the time of injury, advising the employee of the PPP, and that he or she has the right to opt out of the program.

The bill also calls for compressing the state’s 29 geozips (an area in which all ZIP codes share the same first three digits)  into four regions for non-hospital medical fees and provides for 14 geographic areas for hospitals. The bill also included provisions for a 30% reduction in the medical fee schedule, which took effect on Sept. 1.

Anjali Julka, communications manager for the DOI, told WorkCompCentral that since HB 1698 became effective on June 28, the department has held a series of meetings with workers' compensation stakeholders concerning the provider networks.

Julka told WorkCompCentral that the DOI is modifying its current regulations (50 Illinois Administrative Code Section 2051) relating to preferred provider programs to address the workers' compensation PPP requirements contained in HB 1698. 

DOI has thus far received five applications for PPPs and it is hoped that they will begin operations in early 2012.

Jay Shattuck, executive director of the Employment Law Council of the Illinois Chamber of Commerce, told WorkCompCentral that injured workers will benefit by being directed to health care providers who specialize in treating workers’ compensation cases, while employers will benefit from improved return-to-work rates and lower overall treatment costs.

The key to PPP success in Illinois will be whether the focus of the regulations and the employers that establish networks is on value returned rather than just cost cutting.

Illinois employers need to make sure they learn the lessons from other states that have implemented networks to understand what works and doesn't work.

Specifically what works is ensuring that physicians are paid fairly and reasonably, but also held accountable to established treatment standards and protocol where outcomes are measured and assessed, to ensure the highest quality care in the first 6 months of a claim and high return to work rates.

What doesn't work is early cost containment strategies focused on procedure expenses separate and apart from the overall medical picture.

Illinois is in an enviable position to learn from early adopter states and may be able to show the rest of the nation how to do medical networks right. We'll see over the next few years whether people can actually learn from others past experiences.

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