How to Effectively Imbed Nurse Case Management in WC Claims

by Karen Wolfe

Nurse case management (NCM) has a powerful impact on Workers’ Compensation claim cost and outcome. Positive results of nurse involvement have long been anecdotally accepted, however widespread evidence of nurse impact has not emerged and objective proof of value is still missing. Several factors account for this.

Inconsistent referrals

For one thing, NCM’s are usually considered an adjunct to the claims process, called upon in sticky situations. Too often referrals to nurses is a last resort rather than an integral and standardized part of claim management.[1] When claims adjusters have the sole responsibility to refer to NCM’s, it can be subjective, uneven, and therefore unmeasurable.

Besides receiving referrals for sundry issues at different points in the course of the claim, nurses have not clearly articulated their case management interventions. Claims adjusters sometimes misunderstand the nurses’ approach. However, consistent referrals and standardized procedures can bring about major change.


Consistent referrals
Referrals to NCM should be made based on specific medical conditions in claims such as comorbidity like diabetes or problematic injuries like low back strains that tend to morph into complexity and high cost. Specific risky situations found in in claims data should automatically trigger NCM notification.


A recent article published in Business Insurance, “Nurses a linchpin in reducing workers’ comp costs”, points out how Liberty Mutual has developed a tool that notifies claims adjusters of cases that would most benefit from a nurse’s involvement.[2] Decision burdens for claims adjusters are eliminated. Referrals to NCM are automatic based on specific high risk situations found in the claim. Inconsistency disappears and several benefits evolve from this approach.


Process standardization
An operational process can be dissected and categorized, thereby gaining better understanding of its components and relative importance. Review the data to determine which medical conditions in claims result in longer disability, lower rates of return to work, and, of course, higher costs. Select the conditions in claims that should activate an NCM referral.


An example is a mental health diagnosis appearing in the data well into the claim process. A mental health diagnosis appearing during the claim for a physical injury such as a low back strain is a strong indicator of trouble. The injured worker is not progressing toward recovery. However, the only way to know this diagnosis has occurred in a claim is to electronically monitor claims on a continuous basis.


Data monitoring
To identify problematic medical situations in claims and intervene early enough to impact outcome, the data should be monitored continually. Clearly, this is an electronic, not a human function. When the data in a claim matches a select indicator, an automatic notice is sent to the appropriate person.


Standardized procedures
Catching high risk conditions in claims is just the first step. NCM procedures must be established to guide responses to each situation triggered. Standardized procedures should describe what the NCM should evaluate and advise possible interventions. Such processes not only explain the NCM contribution, they assist in documentation and are the basis for defining value.


Measuring value
NCM has been under-appreciated in the industry because measuring apples to apples cost benefit has been impractical. When claims adjusters decide about referring to NCM’s and individual nurses create their own methodology, variables are endless and little is measurable.


In contrast to the subjective approach, specific conditions in claims found through continuous data monitoring can automatically trigger a referral to the NCM. In response, the nurse is guided by the standard procedures of the organization. When referrals are based on specific conditions in claims and response procedures are delineated, outcomes can be analyzed and objectively scored.


Karen Wolfe is the founder and President of MedMetrics®, LLC, a Workers’ Compensation medical analytics and technology services company. MedMetrics analyzes the data and offers online apps that link analytics to operations, thereby making them actionable. MedMetrics analyzes data continuously and sends alerts as appropriate. MedMetrics also analyzes and scores medical provider performance. karenwolfe@medmetrics.org

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[1] K. Wolfe. Early Intervention Drives Better Outcomes, But is Not Really Pursued http://medmetrics.blogspot.com/2014/10/early-intervention-drives-better.html

[2] B. Kenealy. Business Insurance. http://www.businessinsurance.com/article/20150610/NEWS08/150619977?tags=|92|329|304

How to Optimize the Nurse Case Management Advantage, 2nd Edition

by Karen Wolfe

This is an update to an article posted in January, 2013. The response to it was excellent, suggesting the topic is important.

Traditionally in Workers’ Comp, nurse case management (NCM) services have been widely espoused, yet misunderstood and underutilized. The reasons for underutilization are many. Tension between NCM and claims adjusters for claim ownership is one. Even though overburdened, adjusters often overlook the opportunity to refer to NCM.

Also to blame is the NCM process itself. In spite of professional certification for NCM, the process is poorly defined for those outside the nursing profession. Moreover, and more importantly, NCM has difficulty measuring and reporting proof of value.

Underlying issues

Continuing to do business as usual is not acceptable. NCM needs to address several issues to qualify as legitimate value contributors to the claim process. First, they need to articulate their value. To do that, NCM must computerize and standardize its process, measure and report outcomes, just like any other business in today’s world.

Computerize

NCM is last and least to computerize. When a process is poorly understood, funding and designing an effective software system is impossible. Too often, computerization for NCM is relegated to adding nurses’ notes to the claim system. However, such notes cannot be analyzed to measure outcomes based on specific nursing initiatives.

Package through standardization

Packaging a process is the way to standardize it so it can be understood and valued by others. In most situations, an individual NCM interprets the problem or issue, decides on an action, and delivers the response. The organization’s medical management is thereby a subjective, illusive interpretation rather than a definable, quantifiable product.

Granted, the NCM is a trained professional who reacts to events and conditions in the claim based on a medical knowledge base. But when the product is unstructured, variables in delivery cannot be measured or appreciated.

A process that is different every time can never be adequately defined. Establish organizational standards of conditions in claims to be referred to NCM—without exception. Remove the myriad of decisions made or not made by claims adjusters to involve the NCM. The referral can be automated through electronic claims monitoring and notification. NCM takes action on the issue according to organizational protocol and the claims adjustor is notified at the same time.

 
Measure
When the conditions in claims that lead to intervention by NCM are computerized and standardized, the outcomes or effects can be measured. Apples can legitimately be compared to apples, but not to oranges and tennis balls. Similar conditions in claims are noted and approached the same way every time, so the results can be validly measured.

Results in claims such as indemnity costs, time from DOI to claim closure, or overall claim cost can be compared before and after NCM standardization. Compare across different date ranges for similar injuries going forward to measure continued effectiveness and honing of the process.

Measuring outcomes is the most essential aspect of the process. Value is disregarded unless it is defined, measured, and reported. Many options for measuring success are available when the components are standardized and computerized.

Report

Report and communicate measured outcomes. Never assume others will recognize NCM value without delineating it for them. For non NCM’s, the dots in medical management must be connected to see the picture. Describe what was done, why it was done, and how it was done the same way for similar situations and in context with the organization's standards. Then report the outcome value. Establish a continuing value communication process.

Define process in advance

NCM constituencies should be informed in advance of the process and outcome measurements. Define in advance how problems and issues are identified, executed, and how results will be measured. Then proceed consistently.

Recognized NCM value

Nevertheless, at long last, NCM value is now being recognized. American Airlines recently reported they are adding NCM to their staff and will refer all lost time claims. They cite a pilot project where nurse interventions were documented and measured, proving their value in getting injured workers back to work.

Christopher Flatt, Workers’ Compensation Center of Excellence Leader for Marsh Inc., in an article written for WorkCompWire (http://www.workcompwire.com/) stated, “One option that employers should consider as part of an integrated approach to controlling workers’ compensation costs is formalized nurse case management. Taking actions to drive down medical expenses is an essential component to controlling workers’ compensation costs.”[1]

Industry research and corporate wisdom
Industry research and corporate or professional wisdom regarding risky situations can supply the standardized indicators for referral to NCM. American Airlines uses the standard that all lost time claims should be referred to NCM. But there are many, sometimes more subtle indicators of risk and cost in claims that can be identified early through computerized monitoring and referred for NCM intervention.

Another example of developing standard indicators for referral is based on industry research that shows certain comorbidities, such as diabetes can increase claim duration and cost. These claims should also be referred to NCM for oversight. Yet another example is steering away from inappropriate medical providers who can profoundly increase costs.

Computer-intensified medical management
As a long-ago nurse and a longer-time medical systems designer and developer, I believe the solution lies in appropriate computerized system design. To be effective, the components are those described above. The elements need to be simple to implement, easy to use, and consistently applied. Only then can NCM offer proof of value.

MedMetrics®, LLC offers Medical Intelligence Profiles with Alerts, an online app that serves as a smart container for an organization’s medical management standards and rules of referral. MedMetrics monitors all claims continuously and sends electronic alerts when conditions in a claim match those in a profile. This and other MedMetrics apps link medical analytics to operations, thereby making them actionable. karenwolfe@medmetrics.org

[1] http://www.workcompwire.com/2013/01/christopher-flatt-the-case-for-formalized-nurse-case-management/?utm_source=WCR+Daily+1%2F22%2F13+-+A+New+Leader+Speaks%21&utm_campaign=WCR&utm_medium=email

 

How to Gain the Competitive Advantage in WC Managed Care

by Karen Wolfe

FAQ

A frequently asked question is, how can the value of Workers’ Comp managed care programs be proven? That the question is asked at all is a very good sign for the industry. Value has been ignored for far too long. However, people are less willing to accept assumptions and sales claims of savings as proof of value. The best example of value in managed care measured by assumption and sales claims is in medical networks.

PPO discounts

Medical Preferred Provider Organizations (PPO’s) emerged in Workers’ Comp about twenty-five years ago, mimicking PPO networks in group health plans. Methods of network development were similar to those in general health—sign up doctors and facilities. The deal was, in exchange for being a part of the network, thereby enjoying the marketing benefit of automatically bringing in new business (patients), the provider would accept a discount on their fees for their medical services. The gain for payers, the purchasers of PPO services, was the discount on medical fees. The benefit for networks is a cut of the discount and a very profitable business. But the intrinsic value of networks themselves remains obscure.

The spoof of proof

Unlike PPO’s in general health where the insurance plan defines the rates and what services are reimbursable; Workers’ Comp offers no such restraint. The conditions are set for unbridled medical cost escalation through increased numbers and duration of services. Discounts are proclaimed for each of those services while value received from services, is ignored. However, if people no longer believe in discounts, networks will need a measure of value to gain the competitive advantage.

The question behind the question

The real question behind the frequently asked question (FAQ) of how to prove value is how to gain the competitive advantage. Organizations want to know how to prove their managed care programs save money or generate better outcomes. In other words, they want to show they are better than their competitors. If they can demonstrate that kind of value, they will gain the competitive advantage.

Michael Porter, creator and leader of the Institute for Strategy and Competitiveness at the Harvard Business School has spent his career studying and writing about competitive advantage in all kinds of organizations.[1] He says the competitive advantage is gained by creating and sustaining superior performance.

Positioned for advantage

Managed care programs in Workers’ Comp are positioned to gain the competitive advantage, primarily because it is still a nearly deserted space. Most organizations are still in the FAQ stage. Networks will have great difficulty shifting to a value proposition because they will only reluctantly change their funding methodology.

Network value

The way for networks to create their competitive advantage is to analyze the data to evaluate provider performance. Rather than including every provider, only the best practice providers for Workers’ Comp, based on analysis of the data, will be included. The added challenge for networks is that payers and self-insured, self-administered employers can do this on their own. Moreover, the end savings with a best practice provider can easily outweighs discounts.
 

NCM—mysticism and skepticism

Nurse case management (NCM) has been widely implemented in Workers’ Comp, and at the same time, underutilized and misunderstood. Mysticism and skepticism  plague NCM programs.  The cause is its vague processes, procedures, and reporting.

Gaining the competitive advantage by creating and sustaining superior performance is well within the reach of nurse case management programs, but they will need to step up to superior performance by applying standardized systems and procedures.

Standardize and quantify the process

Nurse Case Management organizations have allowed their product to be defined, manufactured, and delivered by individual nurses, so the product, even with an organization varies widely. Standardized processes are rare.  Even though nurses might be certified in NCM, it is the organization that should establish measurable standards of performance and insure they are followed..

Organizational standards include specified initiatives taken for defined indicators in claims. As a beginning, objective indicators that trigger referral to NCM should be automated through systems to guarantee quality and consistency.

Superior performance

Once the referral is made to NCM, standardized procedures should be followed by individual nurses and the organization. Clients of the organization can be informed of the standards and procedures in advance and in process. In place of mysticism and skepticism, objective statements of goals and intervention tactics are clear.

Calculating savings (value)

Calculating savings is often tricky because it is necessarily based on what might have been had nurse case management initiatives not been applied. Some answers to that question can be found in a former MedMetrics article, “How to Measure WhatMight Have Been”. Needless to say, calculating savings in claims is best achieved when comparing apples to apples, when the conditions triggering nurse case management and the actions taken are consistent.

As Porter says, the competitive advantage is gained through creating and sustaining superior performance. Superior performance in NCM is creating objective standards and following them consistently. Automating and reporting superior performance seals the deal.

MedMetrics specializes in Workers’ Comp analytics and offers online “apps” that link analytics to operations, making them actionable. They strengthen and maximize  medical cost containment initiatives. Visit MedMetrics to learn more or contact  karenwolfe@medmetrics.org to learn how MedMetrics will help your organization gain the competitive advantage.

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[1] http://www.isc.hbs.edu/

How to Optimize the Nurse Case Management Advantage

A White Paper by Karen Wolfe

Traditionally in Workers’ Comp, nurse case management (NCM) services have been widely espoused, yet often misunderstood and underutilized. The reasons for underutilization are many, including claim ownership tension between NCM’s and claims adjusters. More significantly, is NCM difficulty in defining its work and measuring its value. The issue is not lost on the nurses themselves.

Last to computerize

Medical case management is last and least to computerize. NCM typically cannot attract adequate funding to create appropriate systems. When a process is poorly understood, designing a proper software system is impossible. Too often, computerization for NCM is confined to adding nurse notes to the claim system. Notes cannot be calculated or analyzed and outcomes cannot be measured based on nursing initiatives.

Recognized NCM value

Nevertheless, at long last, NCM value is now being recognized. American Airlines recently reported they are adding NCM’s to their medical management staff and will refer all lost time claims to them. They cite a pilot project where nurse interventions were documented and measured, proving their value in getting injured workers back to work. Additional NCM recognition has been published, as well.

Christopher Flatt, Workers’ Compensation Center of Excellence Leader for Marsh Inc., in an article written for WorkCompWire (http://www.workcompwire.com/) stated, “One option that employers should consider as part of an integrated approach to controlling workers’ compensation costs is formalized nurse case management.Taking actions to drive down medical expenses is an essential component to controlling workers’ compensation costs.”[1]

Formalized NCM process

While Mr. Flatt does not define “formalized” nurse case management, he goes on to say, “Nurse case management is considered a “best practice” in helping to direct treatment, manage medical costs, and reduce disability durations, by providing appropriate care and returning employees to work more quickly. Shorter claim durations and returning injured employees back to work have a direct correlation in reducing workers’ compensation costs”.[2] These are certainly the preferred outcomes, but how does the NCM program achieve them? What are the action steps? How is the process documented and measured for effectiveness? Importantly, how are the NCM initiatives standardized across the organization?

Part of the reason NCM is misunderstood is the lack of a formalized process. The services are delivered by individuals responding to a situation as presented to them or as they perceive it.

Referral criteria

Mr. Flatt continues with some concrete suggestions such as deciding what type of claims should automatically be assigned to the NCM and at what points for existing claims. He suggests predictive analytics can be used to make these decisions. However, a formalized and optimized NCM process can be made far simpler and less costly.

Industry research and individual wisdom

Industry research and wisdom gained through individual and organizational experience can supply the indicators for referral to NCM. For instance, one approach is leveraging the America Airlines experience and set the standard that all lost time claims are referred to NCM.

Another example is research shows comorbidities increase claim duration and cost. These cases should also be referred to NCM for oversight. Yet another example is inappropriate medical providers profoundly increase costs. NCM’s should have efficient electronic tools to direct care to the best in class providers.

The list of valid criteria for referral to NCM is potentially extensive.  Nevertheless, the question should be, how can these conditions be identified in claims as they occur and referred to NCM accurately and consistently?

Computer-aided medical management

As a long-ago nurse and a long time medical systems designer and developer, I believe the answer lies in appropriate computerized system design. To be effective, three components are necessary:

1.      Formalized Criteria for referral

Create electronic profiles containing combinations of data elements found in claims that represent the conditions for referral to NCM’s. For instance, when comorbidity ICD-9’s (diabetes, heart disease, obesity) are found in claims, an automatic referral is sent to NCM. This formalizes and enforces the processes consistently.

2.      Technology Powered

Continuously monitor historic and current integrated claim data. The integrated data should contain five years of history and be sourced from clams, bill review, and pharmacy (PBM).

3.      Referral Alert

The system automatically notifies the NCM when the conditions in a claim match that in a profile. This occurs at the beginning or any point during the claim because the data is continuously updated and monitored electronically in context with the criteria.

The process is simple, yet powerful. Moreover, using a computer-intensified medical management power tool offers even more to the process. All referrals to NCM, the reason for referral, and to whom they were sent is documented by the system, thereby creating a formalized audit trail. Organizational procedures or action steps can accompany the referrals, further formalizing and standardizing the process.

Measuring cost savings

When the system documents the process automatically, individual claim savings can be measured. For instance, directing care to a best practice provider, thereby avoiding a low scoring provider, is a cost savings guarantee. Industry research is used as a basis for estimating cost savings in each instance and since it is a computerized system, cumulative savings reports can be produced on demand to quantify the process.

Analytics inspired, technology powered Medical Management

The NCM advantage can be formalized and optimized with technology. Learn more about MedMetrics WC Medical Intelligence Profiles with Alerts and its other medical management power tools or contact KarenWolfe@medmetrics.org for further information.

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[1] http://www.workcompwire.com/2013/01/christopher-flatt-the-case-for-formalized-nurse-case-management/?utm_source=WCR+Daily+1%2F22%2F13+-+A+New+Leader+Speaks%21&utm_campaign=WCR&utm_medium=email

 

[2] Ibid.