By Shelley Boyce, CEO, MedRisk
Managed care has come a long way. Less than two decades ago, the workers’ compensation industry relied on the discounts from their generalist networks to control their expenditures. Carriers and third-party administrators did not yet understand the impact of utilization on key areas of cost like physical therapy. Payers were not aggregating their medical data on the basis of service specialty. “Clinical oversight” was not a conversation at the managed care networks – it was something that carriers’ nurse case managers provided across all types of diagnoses and services as they advocated and navigated their injured workers’ progress. And the only “guidelines” available to the industry addressed disability duration.
A lot has happened over the last 20 years. Specialty managed care has emerged and evolved in a number of areas. Pharmacy Benefit Management (PBM) and Durable Medical Equipment (DME) arrived first, followed by Diagnostic Imaging solutions. Studies from the Workers Compensation Research Institute (WCRI) and the results from early adopters of physical medicine management offerings served to both educate the industry on the importance of physical medicine on medical and indemnity costs as well as highlight the impact of utilization on outcomes. And as specialty-specific network offerings multiplied, the role of clinical oversight, crafted to address the unique aspects of the specialty at-hand began to differentiate the marketplace options. Concurrently, treatment guidelines began to proliferate, starting at the broadest level and working their way into more specificity.
Even as specialty networks demonstrated their value to their customers, including the value of their clinical differentiators, the bigger is better appetite continued, with generalist network consolidation, layering and stacking being the name of the game. Specialty network consolidation has followed, further supporting this size-matters orientation. And while quality, utilization management and clinical oversight continue to be valued concepts, the actual execution of these concepts has been watered down or, in some cases, left behind as organizations have consolidated and integrated, often settling on the lower common denominator.
By definition, clinical oversight can be challenging, especially for organizations that are not in this game for the long term. It requires specialized and advanced skills and education – all of which cost money. It is often case-specific, and therefore labor-intensive. It is not always aligned with those private equity organizations whose investments have a short-term horizon. And it is certainly specialty-specific.
So in these times of unprecedented consolidation that is creating mega-conglomerates that are merging specialty and generalist managed care services, the risk is that the strides that have been made and the trajectory that the industry has been following for the last two decades will be lost.
The ability to handle multiple services quickly and efficiently is a desirable objective. But it shouldn’t devalue, deemphasize or replace clinical oversight and intervention. There were very strong reasons why the specialty managed care arena evolved in the first place. So if homogenization is either an intended or unintended consequence, the industry is taking a step backward. More importantly, the injured worker will be the one paying the price.
As consolidation limits marketplace choices and as specialization is replaced by generalization, it is critical that buyers remember that expertise and ongoing clinical oversight is more important than ever. Service-specific guidelines, care oversight and outlier identification and management are still the answers to achieving the best patient outcomes. Outcomes, which, in the long-run, will continue to be the right answers for the carriers and payers, for their customers and their injured workers.
About Shelley L. Boyce
Shelley Boyce is founder and chief executive officer of MedRisk, Inc. – a leader in physical rehabilitation and diagnostic imaging solutions for the workers’ compensation industry.
Along with overseeing all aspects of MedRisk’s strategic growth and business development initiatives, Ms. Boyce serves on the board of directors of the Workers Compensation Research Institute (WCRI) and is a member and former chair of WCRI’s Core Funders Group.
Ms. Boyce is also involved in a number of initiatives that support business and educational development. She remains active with her alma maters: The University of Virginia School of Nursing and the Wharton School of the University of Pennsylvania. She also serves as chair of the Wharton Entrepreneurship Board and board of directors member of the Children’s Scholarship Fund Philadelphia. Ms. Boyce also plays an instrumental role in supporting future healthcare professionals as chair of the University of Virginia School of Nursing Board.
Ms. Boyce holds a Bachelor’s Degree in Nursing from the University of Virginia and a Master of Business Administration from the Wharton School of Business at the University of Pennsylvania.
MedRisk is a leader in physical rehabilitation and diagnostic imaging solutions for the workers’ compensation industry. Founded in 1994 and based in King of Prussia, Pa., MedRisk has been ranked as one of the fastest-growing companies on several lists, including Modern Healthcare’s Fast 40, the Inc. 500|5,000, Deloitte’s “Technology Fast 50,” and Philadelphia SmartCEO magazine’s Future 50. MedRisk is fully accredited under URAC and has successfully completed a SSAE 16 Type II examination. MedRisk’s programs deliver savings and operational efficiencies that are significantly greater than traditional programs. Customers include insurance carriers, self-insured employers, third-party administrators, state funds, general managed care companies, case management companies, claims adjusters and physical medicine providers. To make a referral or obtain more information, visit www.medrisknet.com or call 800-225-9675.