Blog Reader Question-Do PPO’s Save Money in Workers Comp

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Workers Comp PPO’s Save Money

Did Workers Comp PPO’s save money? Do Workers Comp Preferred Provider Organizations (PPO’s) really save money? Do PPO’s diminish the level of care that our injured employees would receive vs. having no PPO?

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Workers Comp PPO’s have gone from a simple discount for certain providers to very complex systems. PPO’s vary among each type of service offered. They can be a generalist PPO where all the providers are one large PPO, to specialist PPO’s such as Pharmaceutical or Physical Therapy.

The PPO’s pre-negotiate a discount from the medical providers. The providers sign on with PPO’s to drive more business to their practices.

Do PPO’s diminish any type of care? No, as in all the years I have been in Workers Comp, I have never seen an instance of where an injured employee in a PPO did not receive the same level of treatment that a non-PPO employee received to treat their injuries.

PPO’s do save money if they are examined as to what they really are – a group of medical providers that were willing to take a discount. Quite often, the PPO’s sign up as many medical providers as possible whether they are industrial-type providers or not. As the PPO makes their $ off the employee seeing one of their medical providers, the marketing department for PPO’s will attempt to sign up all the medical providers in a certain area.

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Our recommendation is to send the employees to the medical providers that you have an established working relationship with. Sometimes, saving 15% on a medical bill may not be worth it if, for example, the doctor did not know that you have a full Return to Work program in place and wrote an employee out of work with a 25lb weight lifting restriction.

California has proven that medical networks do work for the most part. CA’s Medical Provider Networks (MPN’s) have saved the employers in CA millions of $ over the last five years. In my opinion, this was the rule that turned the tide for California Workers Comp.

There are also EPO’s such as Employers Choice Network out of Charlotte, NC. They are able to custom-build medical networks, even within the network that you already have in place. They provide the best of both worlds – a discount and industrial minded medical provider.

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James Moore

Raleigh, NC, United States

About The Author...

James founded a Workers’ Compensation consulting firm, J&L Risk Mgmt Consultants, Inc. in 1996. J&L’s mission is to reduce our clients’ Workers Compensation premiums by using time-tested techniques. J&L’s claims, premium, reserve and Experience Mod reviews have saved employers over $9.8 million in earned premiums over the last three years. J&L has saved numerous companies from bankruptcy proceedings as a result of insurance overpayments.

James has over 27 years of experience in insurance claims, audit, and underwriting, specializing in Workers’ Compensation. He has supervised, and managed the administration of Workers’ Compensation claims, and underwriting in over 45 states. His professional experience includes being the Director of Risk Management for the North Carolina School Boards Association. He created a very successful Workers’ Compensation Injury Rehabilitation Unit for school personnel.

James’s educational background, which centered on computer technology, culminated in earning a Masters of Business Administration (MBA); an Associate in Claims designation (AIC); and an Associate in Risk Management designation (ARM). He is a Chartered Financial Consultant (ChFC) and a licensed financial advisor. The NC Department of Insurance has certified him as an insurance instructor. He also possesses a Bachelors’ Degree in Actuarial Science.

LexisNexis has twice recognized his blog as one of the Top 25 Blogs on Workers’ Compensation. J&L has been listed in AM Best’s Preferred Providers Directory for Insurance Experts – Workers Compensation for over eight years. He recently won the prestigious Baucom Shine Lifetime Achievement Award for his volunteer contributions to the area of risk management and safety. James was recently named as an instructor for the prestigious Insurance Academy.

James is on the Board of Directors and Treasurer of the North Carolina Mid-State Safety Council. He has published two manuals on Workers’ Compensation and three different claims processing manuals. He has also written and has been quoted in numerous articles on reducing Workers’ Compensation costs for public and private employers. James publishes a weekly newsletter with 7,000 readers.

He currently possess press credentials and am invited to various national Workers Compensation conferences as a reporter.

James’s articles or interviews on Workers’ Compensation have appeared in the following publications or websites:

  • Risk and Insurance Management Society (RIMS)
  • Entrepreneur Magazine
  • Bloomberg Business News
  • WorkCompCentral.com
  • Claims Magazine
  • Risk & Insurance Magazine
  • Insurance Journal
  • Workers Compensation.com
  • LinkedIn, Twitter, Facebook and other social media sites
  • Various trade publications

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