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Workers Comp Medical Provider Networks Absence = Losing $1 Million


Absence of Workers Comp Medical Provider Networks – 1993 Example Still Resonates Today

Workers comp medical provider networks can usually provide injured employees with the utmost care while saving medical treatment dollars.  A win-win-win situation between the injured employee, medical provider, and employer can be attained if a preset workers comp medical provider network is in place.

The most popular slide that I have used in presentations is below.  The names refer to no individual provider.  The names were changed for privacy concerns.

I was assigned this file as a troubleshooter in 1993 with the TPA that I was working with at the time.  The claim was a few years old.  That claims department had spent well over $420,000 when I took over the handling of the claim. The path of medical treatment is highlighted in green.

I converted the  1993 to 2022 dollars.  The converted dollars totaled $1 million.  That is paid dollars, not reserved dollars.  How did this happen?


flowchart of workers comp medical provider networks example
(c) J&L Risk Mgmt Consultant -author’s own work-all fictitious names for privacy

Above Example – Wrong or No Use Of Workers Comp Medical Provider Networks

One of my first articles written on this website was Six Secrets To Saving On Workers Comp Costs.  The hallmark of that list is Medical Provider Networks.  I will borrow from my presentation on this slide.

How Does A Biofeedback Specialist Become A Treating Provider?

The green path is what happened on the claim.  An employee came into the employer’s office after wrenching their back while lifting some oilfield equipment.  They were complaining of numbness and tingling in their right lower leg.

As the green path above shows, the employee was told that the employer was too busy and to seek treatment on their own.

There is nothing wrong with biofeedback as a treatment.  The treatments were much more popular in the late 1980s and early 1990s.   The biofeedback specialist became the treating physician – of sorts.

Let us look at how that happened.

  1. The employee goes home.  This is one of my consulting rules – if an employee has to stop their work, see that they go to one of the providers in your workers comp medical provider network.
  2. The injured employee calls their family physician.  The family physician does not see them.  They are wisely immediately referred to a neurologist. That is why the family physician was not a green box.
  3. The neurologist orders an MRI of their lower spine.  Two herniated disks are present.
  4. The neurologist refers the injured employee to an orthopedic surgeon.
  5. Due to the level of disc damage, the orthopedic surgeon brings in a neurosurgeon as the injury was considered severe.
  6. A disc fusion surgery was also necessitated due to multiple levels of herniation.
  7. The adjuster receives a Twilight Zone Phone Call from the surgery scheduler.  The first report of injury (FROI) was not yet filed by the employer with their TPA.  The adjuster had to call and ask for the FROI.
  8. The injured employee requires 6 months – at a minimum- of physical therapy.
  9. A pain management physician takes over the care due to the level of pain.  The pain management physician sees the employee three times a year.  The pain management physician is to treat the injured employee until they can be released back to the surgeons.
  10. The pain management physician refers the injured worker to a biofeedback specialist that now becomes the main medical treatment provider on the file.   The physical therapist seldom sees the injured worker.


This is where I reviewed the file – $445,000 spent (not counting reserves) in 1993 dollars on a 1990 claim.

What would you do with this file?  My answer will be in the newsletter next week.  Feel free to comment below on this interesting file that involved workers comp medical provider networks.

Related: Third Party Administrator Adjusts Workers Comp Claims For Self Insureds

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James J Moore - Workers Comp Expert

Raleigh, NC, United States

About The Author...

James founded a Workers’ Compensation consulting firm, J&L Risk Management 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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