By Paul Glover, Chairman and CEO, ISG Services, LLC
Unlike any other insurance risk, workers’ compensation is state-mandated across the United States. Maintaining compliance with each state’s unique legal requirements demands extensive professional and financial resources. Many workers’ compensation payers employ attorneys to ensure they remain compliant with the hundreds of regulatory changes that occur each year.
Along with the state legislative impact, routine and ad hoc changes to state and Centers for Medicare & Medicaid Services-based fee schedules, billing rules and billing guidelines also come into play. In this ever changing re-pricing landscape, the payor not only must stay abreast of these mandates, but also ensure the timely and accurate implementation of software and process updates to put the required changes into place. In 2012 alone, jurisdictions made over 200 changes to their fee schedules and related rules for payment of medical bills. In addition, multiple states enacted new legislation to implement electronic billing standards, new treatment guideline requirements, and explanation of review requirement changes. California implemented a medical data call to the WCIRB, and North Carolina introduced a mandatory electronic medical EDI reporting requirement for 2014.
To remain compliant, bill review and medical management entities should engage a vast array of clinical and non-clinical professionals, including attorneys, physicians, nurses, as well as bill review and regulatory compliance specialists, to interpret state regulations and apply the required changes to bill review software and workflows. Employing a team of regulatory experts is essential in educating stakeholders, implementing the changes, and providing expert bill review, validation and auditing functions.
Like accounting firms that have separated their consulting and audit divisions, a “separation of duties” is critical to deploying a compliant solution. Does your bill review and medical management vendor employ clinical, coding and billing experts? Are your experts communicating the necessary revisions to software engineers, who are responsible for incorporating the requisite changes to the information systems in a timely manner?
In addition to complying with numerous state-specific bill review amendments, the ability to recognize, adopt and apply enhanced processes is essential when responding to the managed care impact of major legislative milestones such as Illinois HB 1698, Texas HB 473, California SB 863, Washington Substitute SB 5801, and others. To determine your firm’s ability to adhere to each state’s legislative and regulatory requirements, ask the following questions:
- How do we collect data, research the effects of new regulations and implement dynamic processes to ensure compliance and minimize exposure in all jurisdictions?
- How do we validate our compliance with state laws on a line item at the bill payment level?
- What tools have we given front-line staff, including claims adjusters, case managers and billing professionals to enhance billing and managed care compliance?
- Have we embedded the changes into to our software, payment systems and/or clinical workflows? More importantly, have we completed post implementation audits to ensure efficacy?
If you are relatively confident in your firm’s ability to understand, implement, test and audit the deployment of processes amenable to each state’s legislative nuances, then you are in the minority. Implementing financial controls in the workers’ compensation sector are important risk mitigation tools few have mastered. There are no federally-mandated claims processing compliance guidelines analogous to the industry-accepted auditing standards of service organizations (SSAE 16), which are designed to prevent or detect and correct misstatements in an organization’s financial statements. As a result, the implications for non-compliance are potentially far reaching and may result in significant consequences requiring a disproportionate amount of resources to rectify.
In closing, I would encourage you to make substantial investments when researching, interpreting and reacting to the many rules and regulations within our industry. Doing so will provide safeguards against risk exposure and help ensure your organization is fully compliant when processing medical bills. In my next installment, I look forward to sharing specific tools, such as StrataCare’s Compliance Library (outlined below), which can serve as an embedded application to integrate best practices in compliance.
About Paul Glover
Paul Glover founded ISG Services LLC in 2008 and is Chairman and Chief Executive Officer. Prior to ISG, Mr. Glover has been a leader in the workers’ compensation managed care industry with roles in managed care, third party administration and insurance companies. Mr. Glover holds an A.B. degree in Economics from Dartmouth College and an M.B.A. in Finance and Accounting from Cornell University.
About the Compliance Library
StrataCare has made a substantial investment in people and technology to develop and maintain an embedded application within the StrataWare bill review technology platform, aptly named the Compliance Library. It is an interactive web-based repository including thousands of changes annually encompassing regulatory rules and jurisdiction-based information for workers’ compensation. The Compliance Library is comprised of substantial on-demand information, including state regulations, fee schedule administration, bill review rules, and topic based resources, such as the application of Medicare methodology and UCR as an alternative reimbursement source. In addition to easily accessible links throughout, notifications and alerts can be established to jurisdiction based information to inform decision makers prior to adjusting or reconsidering medical bills of new information that has become available that may affect reimbursement.
About ISG Services LLC
ISG Services LLC is the nation’s leading healthcare technology company with a suite of software and services that enable highly targeted data-driven interventions to achieve meaningful impact on outcomes and financial performance. ISG utilizes extensive data analytics to identify gaps in care, quality or integrity and applies the appropriate resources to ensure rapid resolution. ISG’s affiliates include the following well-known entities: StrataCare, the nation’s premier workers’ compensation bill review software and service provider, and Bunch CareSolutions offering innovative managed care solutions.