Bill Review Companies – A Hot Topic in Risk Management
One of the most popular requests we receive is to analyze an employer’s Workers Comp Preferred Provider network (PPO) and bill review charges. This is usually an add-on service to some of our other review offerings.
Bill review and medical network charges are becoming hot topics of discussions between Risk Managers various public and private employers. Bill reviews are usually based on the existence of a fee schedule in a certain state.
The different types of charges for fee schedule states are based on:
- Header or per bill fee
- Fee per line processed
- % of savings
- Network – PPO Fee
- Combinations of the first four
Risk managers for self insured public entities are now even breaking out bill review and medical network charges separately from the TPA fees. This may be a good idea in some cases as the mixture of TPA claim processing fees can be confusing.
Many risk managers are now beginning to bid the medical processing fees as a separate Request For Proposal (RFP) or at least allowing bill review and PPO networks to bid separately from the TPA claims processing bids.
There is sorely missed area in the evaluation of a bill processing company for WC and their associated networks. The provider effectiveness measurement is actually what most adjusters use and not whether a provider is in a certain network.
The targeted amount for most Workers Comp PPO’s is a reduction of 15% of the bottom line bill which is #4 on the above list. If one medical provider has a great history of returning workers to gainful employment, does the 15% reduction really matter?
A great surgeon for example may end up saving much more on the claim than the 15%. One of the most disconcerting things that we see in files is when the adjuster has NO decision on the medical provider as it is pre-chosen by the network and location. This removes all loss reduction strategies on the medical part of the file, which of course affects the indemnity part of the file.
The best of both worlds is to have the most efficient and effective medical provider for Workers Compensation be in the medical bill provider’s network. If the treating physician is able to return employees to work with no delays, the adjusters can keep the indemnity and medical reserves in check.
I did not mention the U&C (Usual and Customary) charges for the remaining states without a fee schedule. I will cover those next time.
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