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The MedMetrics blog provides comments and insights regarding the world of Workers’ Compensation, principally, issues that are medically-related. The blog offers viewpoints regarding issues affecting the industry written by persons who have long experience in the industry. Our intent is to offer additional fabric, perspective, and hopefully, inspiration to our readers.

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Monday, August 16, 2010

Part III Transforming Provider Networks into Quality Networks

This series began with Rating Medical Providers—Part I, describing how rating medical providers in group health has evolved over the past thirty years and where those initiatives stand today. Physician rating in group health is differentiated from that required in Workers’ Compensation. Group health physician rating does not translate directly to Workers’ Compensation, because the goals and process issues are different. Part II of this series, Rating Medical Providers for Workers’ Comp, takes the next logical step.

Part II describes how physician rating in Workers’ Comp necessarily demands evaluating providers and networks using unique, non-clinical performance criteria. While medical treatment quality remains crucial, non-medical performance is of equal importance. Process and non-medical determinations must adapt to the workplace and distinct cost considerations. This article, Part III in this four-part series takes yet another step to consider how to evaluate networks.

A recent discussion on the LinkedIn Work Comp Analysis Group was introduced by the statement, “California MPN’s: aren’t they all the same?” The implication is since there is a finite number of practicing physicians in California, many of them will appear in multiple MPN’s, therefore one network is more or less like another. The discussion in the group naturally widened to a discussion of medical providers in networks beyond California. Suggestions regarding ways to find the best physicians and “hand-select” providers were put forward. Ideas included establishing rapport with providers, listing quality indicators and asking providers to visit the work place—all good tactics, but difficult to evaluate, maintain and replicate. Amazingly, no one suggested seeking objective data regarding provider performance!

This is really about two separate issues. The first is deciding how to choose a network and the other is choosing medical providers within the network selected. When selecting a network, rather than trying to evaluate the participating providers, the network structure and administration itself should be the first focus. What kind of provider evaluation and monitoring does the network provide? What are the measures of quality for participating providers? Does the network provide regular analyses and reports of provider performance for their customers? Many network administrators consider their job complete when they have enrolled as many providers as they can find.

Another critical factor to consider about networks is the sort of financial incentives that are used with their contracted providers. Are they using the tired approach of extracting discounts from providers in exchange for directing patients to them? More sophisticated networks today are not discounting provider fees as dues for membership. Instead, they are rewarding providers who have good track records for returning injured employees to work and achieving positive outcomes. Asked the question, which is better—discounting provider fees or rewarding providers for excellence, most would choose the latter. But, it’s easier to calculate discounts than it is to evaluate performance.

Network administrators should be evaluating providers using the rating systems described in Parts I and II of this series. For instance, measure frequency and duration of medical treatment compared with the performance of similar providers or specialists treating similar injuries. Recall that most networks discount provider bills on individual unit fees. Why wouldn’t providers increase frequency and duration of treatment when they are docked on individual elements? Refer to our article, The Conspiracy of Silence in Medical Provider Networks for more details.

Only the data offers objective bases for provider performance evaluation and remains the only untapped source of rational provider selection. Yet, provider performance evaluation based on the data is available and affordable. Networks do not typically subscribe to the approach suggested here because it would require changes to their revenue structures. Using the data to evaluate provider performance, redesign networks, and reward exemplary behavior drives a wedge into systems that have been operating on autopilot for decades.

Would network consumers rather spend more money to identify providers that show documented positive track records or continue to play roulette in that regard? Would those network purchasers prefer documented outcome information or continue trying to establish rapport with providers to influence results? Interestingly, most providers would also prefer the documented information approach.

Most providers, unless they are deliberately fraudulent, would elect the documented data methodology. Comparative analyses can and should be shared with them, a simple yet powerful strategy not typically employed.

Managing provider performance by sharing comparative data with individual providers can be likened to the old Hawthorn Effect research where subjects who know they are being watched change their behavior, typically moving toward the mean. Most medical providers have never seen comparative data and would consider it extremely helpful. Most would not choose to be an outlier.

Moreover, the analyzed data is a prime platform for discussion and planning with individual providers that will lead to genuine professional rapport. Developing a collaborative relationship with objective tools to support it along with similarly documented and monitored activity going forward will lead to continued improvement.

Identifying best practice treating physicians is imperative, and one direct route is through a responsible and advanced network administrator. Network purchasers should stop believing the status quo myth. Savvy purchasers should select networks that evaluate and monitor the data.

View additional articles by Karen Wolfe under Blogs at www.medmetrics.org