Reinventing Workers' Compensation Networks

In this era of rapid changes to health care, networks are becoming more important than ever. They’re evolving from relatively straightforward mechanisms for directing patients and controlling costs to collaborative partnerships between payers and providers. This evolution of networks, particularly those focused on workers’ compensation, prioritize both efficacy and efficiency. The best clinicians can more easily rise to the top of the stack thanks to deeper insights into patient trajectories. In the emerging scenarios, powerful analytics and algorithms pull data to evaluate outcomes and push data to aid clinicians in doing what they do best — taking care of patients in supporting their return to work and a return to their daily routines.

Networks continue to lean into being the best at what they’ve always done: managing the relationship with the provider. In addition, workers’ comp networks offer providers another stream of revenue that features less administrative effort. Networks continue to work with providers to streamline administrative burdens. These steps include letting providers: 

• Bill insurers directly, often electronically, thereby reducing the guesswork and the collections burden
• Grow and diversify their patient base
• Benefit from being independently credentialed
• Establish long-term relationships with patients extending beyond the care for work-related injuries or illnesses
• Support employers in their communities
• Reduce instances of coordination of benefits with multiple payers

Workers’ compensation networks are also unique in other ways. For example, the pool of injured workers goes beyond patients who might solely be served by a particular payer. This allows providers to expand the reach of their practice to new segments of the community in which they operate. And when providers seek to refer injured workers to other clinicians, a network offers an extension of their current referral patterns.   

Expanding one’s practice, treating those injured on the jobs, makes sense for other reasons as well. Injured workers aren’t responsible for deductibles or copays. This is becoming an ever-more-important differentiator. That’s because out-of-pocket costs can be difficult for patients to manage, especially as many are now expected to shoulder a larger share of the medical expense with the rise of high-deductible commercial plans.¹ It’s worth considering how onerous this burden has become for many people, the provider, the patient, and the insurance company. More than half of personal debt in collection is tied to medical bills, reports the federal government’s Consumer Financial Protection Bureau.² In 2018, consumers borrowed some $88 billion to pay for health care, according to a survey from Gallup and West Health, a nonprofit. The findings also revealed one in four Americans decided to forgo medical treatments because of concerns about cost.³

By sidestepping the need to collect copays, it’s easier for providers to receive the full contractual reimbursement directly from the payer in a timely manner. Not having to pursue patients for past-due bills is a help, particularly concerning medical expenses and the administrative costs associated with collections activities. That’s because some individuals put a lower priority on repaying medical debt, according to Benedic Ippolito, a research fellow and health economist with the American Enterprise Institute.⁴

There are other long-standing benefits of workers’ comp networks that appear to be becoming more pronounced. Work comp reimbursement rates for providers remain well above those seen in group health. One examination by the National Council on Compensation Insurance (NCCI) found prices in workers’ comp are 12 percent higher than those in group health.⁵ It’s worth recalling that part of the reason work comp reimbursements are higher is due to the fact that workers’ comp reimbursements are meant to meet the actual cost of administering the care. Too often providers simply can’t cover their expenses. A recent poll of about 475 physicians found two-thirds believed Medicare payments in 2019 wouldn’t prove sufficient to cover the cost of care.⁶ Some respondents contend the complexity and comorbidities often associated with caring for older workers make reimbursements all the more inadequate compared with workers’ comp care.

Payers and the companies they represent are also eager to get injured workers back on their feet and back on the job. Major employers like manufacturers, large retailers, and airlines rely on comprehensive return-to-work programs to help their injured employees recover. The best programs do far more than safeguard the bottom line. They focus on truly addressing the needs of injured workers themselves. That’s because the longer workers are away, the less likely it is they will return to the workplace. The New York State Workers’ Compensation Board has broken down some statistics, and reports that there is only a 50 percent chance that an injured employee will return to work after a six-month absence.⁷ That drops to a 25 percent chance following a one-year absence. After two years away, the likelihood a worker will return plunges to a one percent chance.

Top companies understand that having a worker return to the job either under modified duty or, if possible, full duty, is the best outcome for workers and for business. Therefore, these payers offer fair reimbursements to providers and pay on time. That’s because top-tier employers recognize the irreplaceable value providers bring. Alongside employers and payers, providers are part of a three-legged stool that helps injured workers return to the job. This rewarding role is what helps set marquee workers’ comp networks apart; it’s the shared focus on return to work that is essential to a patient’s ultimate success.

The benefits that workers’ comp networks bring to employees, employers, and providers are clear. What’s most interesting is how networks are evolving to meet the needs of employers and patients. These next-generation networks often are tighter, specialty-focused, smaller — right-sized — networks that benefit providers by grouping together the best of the best. Many such networks pull together smaller groups of providers with specific expertise who can best help injured workers. And, of course, specialty networks focus on narrow areas to let clinicians do more of what drives them and what they’re best at doing. These newer networks present providers with opportunities to keep up with their peers who are utilizing new treatment regiments with emerging technologies such as telemedicine and remote patient monitoring.

Workers’ compensation networks today are also doing more to support providers than some of their predecessors. In essence, a strong network means providers have someone blocking and tackling on a range of issues so clinicians can focus on injured workers. These include:   

• Aiding providers with education and interaction on policies, procedures, and efficiency
• Assisting providers’ office staff with quick-reference guides and inquiry support
• Offering providers streamlined utilization review programs and scheduling services
• Sharing insights into state and federal regulations

Amid all the changes in health care — and all the challenges that remain — there are bright spots. One is this new form of networks where we see constructive partnerships between providers and payers in service of injured workers. This allows networks to promote both efficacy and efficiency. They allow the best providers, with the support of payers, to deploy top clinical skills to help injured workers return- to- work.

By Kate Farley-Agee.

Kate Farley-Agee has over 20 years’ experience in the health care industry and oversees Coventry's national broad-based provider network and state-certified managed care organizations across the country, as well as being a contributing author to Coventry’s Blog The Sounding Board.

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