Controlling workers' compensation medical care use and costs through utilization management

Workers' Compensation Status Confers a Greater Number of Postoperative Visits After Common Upper Extremity Surgeries

Background

The impact of Workers’ Compensation (WC) status on postoperative healthcare utilization in hand and wrist surgery clinical practice is presently unclear. The purpose of this study was to compare the number of postoperative visits in WC to non-WC patients after common upper extremity surgical procedures.

Methodology

All patients who underwent one of four common surgical procedures (carpal tunnel release, De Quervain’s release, cubital tunnel release, and trigger finger release) between 2016 and 2019 were identified. A total of 64 surgeries billed under WC were randomly selected and matched 1:1 to surgeries billed outside of WC based on the primary CPT code.

Results

The most common procedure was carpal tunnel release (42 patients), followed by trigger finger release (30 patients), cubital tunnel release (28 patients), and De Quervain’s release (16 patients). The average number of postoperative visits was 2.3 (median = 2, range: 1-9) and was significantly higher in the WC group (mean/median = 3.0/3 versus 1.5/1, p < 0.001). Within the 90-day global postoperative billing period, the mean number of visits was 2.2 (median = 2, range: 1-4) in the WC group and 1.4 (median = 1, range: 1-3) in the non-WC group (p < 0.001). The average time to clinical discharge in the WC group was 101 days (range: 10-446 days), and in the non-WC group was 40 days (range: 7-474 days) (p < 0.001). Five patients (7.8%) in the WC group and four patients (6.3%) in the non-WC group were seen for unplanned visits after clinical discharge.

Conclusions

WC status conferred more postoperative visits after common upper extremity surgical procedures, both within and beyond the global billing period. Further investigation and targeted strategies are required to address the observed increase in healthcare utilization.

Clinical Necessity Guidelines for Psychotherapy, Insurance Medical Necessity and Utilization Review Protocols, and Mental Health Parity

The founding members of the Coalition for Psychotherapy Parity present Clinical Necessity Guidelines for Psychotherapy, Insurance Medical Necessity and Utilization Review Protocols, and Mental Health Parity. These guidelines support access to psychotherapy as prescribed by the clinician without arbitrary limitations on duration or frequency. The authors of the guidelines first review the evidence that psychotherapy is effective, cost-effective, and often provides a cost-offset in decreased overall medical expenses, morbidity, mortality, and disability. They highlight the disparity between clinicians' knowledge of generally accepted standards of care for mental health and substance use disorders and the much more limited "crisis stabilization" focus of many insurance companies. The clinical trials that health insurers cite as justification for authorizing only brief treatment for all patients involve highly selected, atypical populations that are not representative of the general population of patients in need of mental health care, who typically have complex conditions and chronic, recurring symptoms requiring ongoing availability of treatment. The standard for other medical conditions reimbursed by insurance is continuation of effective treatment until meaningful recovery, which is therefore the standard required by the Mental Health Parity and Addiction Equity Act for mental health care. However, insurance companies frequently evade the legal requirement to cover treatment of mental illness at parity with other medical conditions. They do this by applying inaccurate proprietary definitions of medical necessity and imposing utilization review procedures much more restrictively for mental health treatment than for other medical care to block access to ongoing care, thus containing insurance company costs in the short term without consideration of the adverse sequelae of undertreated illness (eg, increased costs of other medical services and increased morbidity, mortality, and costs to society in increased disability). The authors of the guidelines conclude that, given appropriate medical necessity guidelines at parity with other medical care, consistent with provider expertise and a broad range of psychotherapy research, there would be no need or place for utilization review protocols. Individuals and psychotherapy organizations are invited to visit the website psychotherapyparity.org to sign on to the guidelines to indicate agreement and support.

Evaluation of the Work Loss Data Institute's Official Disability Guidelines

OBJECTIVE

The widely used Official Disability Guidelines (ODG), a utilization review guideline for occupational conditions, has not been independently evaluated recently.

METHODS

We applied the appraisal of guidelines for research and evaluation (AGREE II) and modified a measurement tool to assess systematic reviews (AMSTAR) instruments to assess guideline development methods and the quality of supporting systematic reviews. Multidisciplinary experts rated the validity of clinical content for 47 topics.

RESULTS

The overall AGREE II score was 58% due to a combination of favorable attributes (breadth, clear recommendations, frequent updating, and application tools) and unfavorable attributes (scant input from workers and uncertainty about editorial independence). The modified AMSTAR rating was fair/good due to limited information on methods. Panelists rated clinical content as valid for 41 topics.

CONCLUSIONS

ODG appears to be acceptable to clinicians, but ODG requires greater rigor to keep pace with methodological advances in the field of guideline development.

Determinants of Escalating Costs in Low Risk Workers’ Compensation Claims

OBJECTIVE

To identify and quantify attributes that lead to unanticipated cost escalation in workers' compensation claims.

METHODS

We constructed four claim categories: low initial reserve/low cost, migrated catastrophic (low initial reserve/high cost), high initial reserve/low cost, and catastrophic (high initial reserve/high cost). To assess the attributes associated with the increased cost of migrated catastrophic claims, we analyzed 36,329 Louisiana workers' compensation claims in the four categories over a 5-year period.

RESULTS

In the 729 claims initially thought to be low-cost claims (migrated catastrophic), the most significant predictors for cost escalation were attorney involvement and claim duration, followed by low back disorder, married/single/divorced status, male gender, small company size, high premium, reporting delays, and older age. These injuries accounted for 2% of all claims but 32.3% of the costs. Accelerated escalation of costs occurred late in the claim cycle (2 years).

CONCLUSION

Certain attributes, particularly attorney involvement and claim duration, are associated with unanticipated cost escalation in a small number of claims that drastically affect overall losses. The results of this study suggest that these cases may be identified and addressed before rapid escalation occurs.

Improving Quality Through Identifying Inappropriate Care: The Use of Guideline-Based Utilization Review Protocols in the Washington State Workers’ Compensation System

Utilization review (UR) is widely instituted to ensure that medical treatment is clinically necessary and appropriate. UR programs have been criticized for their failure to promote quality and for relying on proprietary review criteria that are rarely subject to external, independent evaluation or validation. In fashioning its UR program for workers' compensation, the Washington State Department of Labor and Industries sought to address these shortcomings. Working collaboratively with the state medical association, the Department of Labor and Industries developed treatment guidelines and then used these guidelines to formulate review criteria for UR. From 1993 through 1998, 100,005 UR reviews were conducted, half of which used the guideline-based review criteria. We analyzed these reviews to examine the patterns of denied requests. The overall denial rate for the guideline-based reviews was 7.3%. The highest denial rates were for thoracic outlet syndrome surgery (19.1%) and lumbar fusion (17.7%). The use of guideline-based UR protocols may improve the effectiveness of UR as a tool to identify potentially inappropriate care.

The effect of a health care management initiative on reducing workers' compensation costs

The effect of both a cost control and health care management initiative (HCMI) on Workers' Compensation costs at a self-insured University Hospital was assessed. Seven cohorts of injured workers were studied. Cost control measures started in 1993 included early return to work and injury prevention programs, internal administration of legal cases, and utilization of modified duty assignments. The health care management initiative fully in place in 1997 included aggressive case management and preferred provider panel utilization. Workers' Compensation indemnity costs and lost workdays incurred by each cohort were compared. A 41 to 59% reduction in indemnity payments and 46 to 67% reduction in lost time cases were realized after the health care management initiative was fully in place. During this time, accepted claims were reduced by 10 to 15%. The quality of the provider panel, as measured by academic credentials, experience and board certification, did not change. Cost control measures, without comprehensive case management, did not decrease these parameters significantly. The health care management initiative realized reductions in lost time cases and Workers' Compensation indemnity costs.

From physician to consumer: the effectiveness of strategies to manage health care utilization

Many strategies are commonly used to influence physician behavior in managed care organizations. This review examines the effectiveness of three mechanisms to influence physician behavior: financial incentives directed at providers or patients, policies/procedures for managing care, and the selection/education of both providers and patients. The authors reach three conclusions. First, all health care systems use financial incentives, but these mechanisms are shifting away from financial incentives directed at the physician to those directed at the consumer. Second, heavily procedural strategies such as utilization review and gatekeeping show some evidence of effectiveness but are highly unpopular due to their restrictions on physician and patient choice. Third, a future system built on consumer choice is contradicted by mechanisms that rely solely on narrow networks of providers or the education of physicians. If patients become the new locus of decision making in health care, provider-focused mechanisms to influence physician behavior will not disappear but are likely to decline in importance.

The association of health risks with workers' compensation costs

The purpose of this study was to investigate the association between health risks and workers' compensation (WC) costs. The 4-year study used Health Risk Appraisal data and focused on 1996-to-1999 WC costs among Xerox Corporation's long-term employees. High WC costs were related to individual health risks, especially Health Age Index (a measure of controllable risks), smoking, poor physical health, physical inactivity, and life dissatisfaction. WC costs increased with increasing health risk status (low-risk to medium-risk to high-risk). Low-risk employees had the lowest costs. In this population, 85% of WC costs could be attributed to excess risks (medium- or high-risk) or non-participation. Among those with claims, a savings of $1238 per person per year was associated with Health Risk Appraisal participation. Addressing WC costs by focusing on employee health status provides an important additional strategy for health promotion programs.

Managed care takes to the highway: implications for insureds

Automobile insurance companies are joining the move to managed care in the hopes of reducing health-care expenditures arising out of automobile accidents. Industry interest is strong enough that large managed care organizations, such as Concentra Managed Care, Inc., and HNC Insurance Solutions, are beginning to offer their existing network of providers to persons seeking medical care for automobile accident injuries and their evaluation software to insurers.

While insurance companies have successfully pressed four state legislatures and one commissioner of insurance for authorization to offer consumers a managed care option in automobile insurance policies, these efforts have not gone unchallenged. Vocal opponents, primarily lawyer and chiropractic organizations, question whether persons injured in accidents will receive care when needed (especially if the accident occurs when the policyholder is away from home), what the quality of care received will be, and whether any savings will be passed on to consumers.