Analytics-powered WC Medical Management

by Karen Wolfe

“I firmly believe based on extensive qualitative and quantitative research and the many interviews and discussions I’ve conducted with insurance industry leaders—that analytics represent the industry’s best path to success and survival in a rapidly transforming world.”[1] 

This is not a controversial statement. Most people now acknowledge the importance of analytics. The question is what is the best approach to analytics in order to achieve optimum results? It’s not enough to prepare analytic graphs and pin them to the wall or publish them in reports for the C-Suite. The information might be eloquent, but nothing will happen or change until it is pushed into operations where action can be taken. Analytics should solve problems. 

Solve problems 
In Workers’ Compensation, a major problem is our inability to contain continually increasing medical costs. Cost containment initiatives implemented to date have helped, but the job is far from complete. Happily, a new methodology is now available—analytics-powered medical management. 

Analytics defined 
Analytics is basically a fancy term for data analysis and there are many forms. A good place to begin is with descriptive analytics, a preliminary stage of data processing that creates a summary of historical data and integrates data from different sources to yield useful information. It also prepares the data for further analysis. 

Developing knowledge 
The data can be re-organized to make it easy to identify patterns and relationships, not otherwise obvious. The data can be queried and reported for more insight. It can also be re-packaged for better understanding or to initiate an action. To an individual in an organization, analytics can make the information derived from the data easy to locate, access, understand, and act upon. 

Real time intelligence 
When the data is monitored continuously, business units gain the advantage of near real time intelligence. Concurrent knowledge of conditions and events in a claim offers the opportunity for early intervention. Early intervention means the damage can be curtailed, thereby reducing claim costs and complexity. Outcomes are improved. 

Actionable information
Information is most powerful when it is current. What occurred two months ago may not be accurate or even relevant now. Conditions about events may have changed substantially so time is wasted manually updating the information before taking action.

One of the most important benefits of analytics is the ability to push timely information to the people who need it and can act on it most effectively. In the case of Workers’ Compensation, those persons are most likely claims adjusters and medical case managers who are in the trenches with claims. When these business units are alerted to pre-defined conditions in claims, their responses are more authentic and better outcomes result. 

Structured notification 
Specific information in claims pushed to the appropriate person in near real time is powerful. That person might be a claims adjustor, medical case manager, supervisor, or medical director who will act on the information based on procedures developed by the organization. The organization determines what situations in claims should be addressed, those potentially the most costly or disruptive based on historic analysis. Moreover, the organization determines what actions should be taken, and by whom. 

Structured response 
Structured notification and responses in the form of standardized procedures lead to consistency. As with any organizational procedure, allowances are made for professional authority, nevertheless, cost savings gained through consistent processes can be reliably measured. 

Spon
Measureable results 
Measures of medical management savings in Workers’ Compensation have been elusive. Without structured problem identification and response, apples to apples comparisons and analyses are impossible. A major benefit of analytics-powered medical management is the ability to dependably measure the benefits derived through data monitoring, analysis, notification, and response.

Karen Wolfe is the founder and President of MedMetrics®, LLC, a Workers’ Compensation, analytics-powered, medical management company. MedMetrics analyzes and scores medical provider performance and offers online apps that link analytics to operations, thereby making them actionable. karenwolfe@medmetrics.org

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[1] Applebaum, S. Analytics and Survival in the Data Age. LinkedIn Pulse. news@linkedin.com. February 18, 2016.

Finding Actionable Provider Ratings in Workers’ Comp

by Karen Wolfe

With the tongue-in-cheek title, “When Yelp reviews are better than hospital rating systems” Jason Beans of Rising Medical Solutions discloses the inconsistencies of standard hospital reviews.[1] He cites a Health Affairs study[2] that points out traditional rating systems, those that have been relied upon in the healthcare industry for years, rarely come up with the same results for the same hospital.


Hospital rating systems score hospital performance in an effort to determine quality and safety in hospitals. The Health Affairs study concludes discrepancies among rating systems is likely explained by the fact that each system uses its own rating methods, defines quality differently, and stresses different measures of performance. Apparently, no standards for quality and safety in hospitals are available.


This begs the question of how scoring systems for rating other medical providers differ from those of hospital scoring systems. More specifically, what about those used to score provider performance in Workers’ Compensation? Lest the conclusion be that all provider performance scoring systems lack credibility, it might be instructive to at least loosely compare hospital rating systems with physician scoring in Workers’ Compensation.


Not similar 
They are very different. The conditions, methodology, and approaches are significantly different. The hospital rating systems cited by Health Affairs evaluate general health in acute care settings. To measure cost, they measure an episode of care on a per diem (per day) basis for individual hospital stays, adjusted by diagnosis and procedures. Often subjective reports are used, as well.


On the other hand, measures of quality performance in Workers compensation are unique to the industry and the number of measurable variables are numerous. How a medical provider acknowledges and influences distinctive industry factors along with success of the medical treatment procedures are indicators of quality performance.

Episode of care

One major difference is the episode of care in Workers’ Compensation is not per diem, but is defined by the scope of the claim. An episode of care (claim) is from the date of injury to claim closure and includes all treatment, medical providers, vendors, events, and outcomes that occur during that time. It may or may not include hospitalization, but when it does, those costs and events are included with total claim. In other words, the episode of care is highly definable in Workers’ Compensation. It is broad and comprehensive.

Quality indicators 
A number of non-medical indicators found in the data reflect unique conditions in Workers’ Compensation that are influenced by treating providers. Measures of quality include return to work and indemnity costs, neither of which is medical treatment precisely, but is strongly influenced by the treating provider and affects the cost of the claim. Consequently, these factors must be included in evaluating performance.


Frequency and duration of treatment, as well as duration of the claim are indicators of provider performance. Providers can contain or increase costs described by these factors. Functional outcome described in the data as disability ratings at the conclusion of the claim are also measures of treatment success.


Clinical factors and treatment processes are important quality indicators, of course, and must be included in the evaluation and scoring. Abuse of Schedule II drugs are, for example, a major cost driver in Workers’ Compensation. Dispensing medications is another.


Source data
Each data-rich claim contains the information necessary to evaluate medical provider performance for Workers’ Compensation. Importantly, the data must be integrated from the silos of bill review, claims system, and PBM (pharmacy) in order to achieve a comprehensive picture of the claim and medical providers’ involvement.

Workers’ Compensation can be more complex than general health because it is a legal system rather than a defined benefit. Every claim has administrative aspects as well as medical assessment and treatment. It’s all in the data.

Objective data 
Scores of medical provider quality indicators can be found in Workers’ Compensation data. The beauty is data describes what actually took place during the course of the claim, not what should have happened or an opinion about it. It is concrete and objective. Yelp can’t help.

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 super-charge medical management by linking analytics to operations, thereby making them actionable. MedMetrics also analyzes and scores medical provider performance. karenwolfe@medmetrics.org

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[1] Beans, J. When Yelp Reviews Are Better Than Hospital Rating Systems. May 12, 2015. http://www.riskandinsurance.com/when-yelp-reviews-are-better-than-hospital-rating-systems/

[2] National Hospital Rating Systems Share Few Common Scores and May Generate Confusion Instead of Clarity. Health Affairs. May, 2015. http://content.healthaffairs.org/content/34/3/423.abstract

Are You an Industry Disruptor? It Can be a Good Thing

by Karen Wolfe

The idea of an industry disruptor might be reminiscent of a classroom prankster, the one who continually distracts to keep the teacher off topic. But no. The term “industry disruptor” is being used to describe organizations with concepts or approaches that significantly impact an industry. Because of their unique presence and ingenuity, industry disruptors change the entire industry—often forever.

Industry disruptors

Think of Steve Jobs’ invention and Apple, Inc.’s implementation of the iPod. It turned the music industry on its side. Jobs could envision completely new products and new ways to use them, so he changed the music world. But the music industry was not the only business he disrupted.

Jobs did not invent the cell phone, but he changed the way cell phones are used. The “smart” iPhone profoundly changed the way we use phones. Now they are small, but powerful hand-held computers with apps that embrace almost any activity. Land lines have become almost obsolescent and old “Ma Bell” would not recognize the industry.

Moving on, Jobs also disrupted the personal computer industry with the iPad. Sales are down for laptops and portable computers because people rely on the simpler iPad for personal use, for e-reading, for movies, and for specific business adaptations. As an example, doctors’ offices now use iPads for data input into EMR’s (Electronic Medical Records). iPads and phones even capture credit cards and signatures.

Jobs could “think different”, actually using that phrase in advertising. He could envision, design, develop, and implement electronic tools that disrupt whole industries. Amazingly, the technology, through the continuous development of apps (purpose-specific applications) has allowed expansion from the original concept into every avenue of life.

Yet another, more recent disruptor is Uber. Uber has taken use of the smart phone a step further, thereby changing the way people travel from point to point in cities. Just tap your phone, and you will be picked up and driven to your destination. No money or credit card transactions are needed because that has been set up in advance on the Uber website.  

Uber has seriously disrupted the stodgy taxi industry as people find the simplicity of Uber quicker and more satisfactory. However, disruptor transition is not necessarily easy. Uber is suffering from growth stumbles and legal push-back from the taxi industry. Resistance is found in many industries.

Disruptors in Workers’ Compensation

Everyone agrees Workers’ Compensation needs updating and improving. Unfortunately, the industry is notoriously resistant to change. What would an industry disruptor create for this industry?

Legislation

Some say the big change needed is to legislate the employer opt-out option from state regulated systems. Texas and Oklahoma are the change leaders in that effort. However, a group of employers is working in other states to bring about similar legislation. If well-executed, these efforts could significantly impact the industry.

To bring about superior, sustainable change, new applications of technology will be required to monitor consistency, quality, and compliance across jurisdictions. The technology is available. Now a unique application is needed, one that everyone loves to use!

Loving technology

Loving technology is not a sentiment normally found in Workers’ Compensation. That is because most still think of technology as tedious data input and mistrust the output. Nevertheless, creative technology could boost and enhance nearly every activity in Workers’ Compensation.

The ultimate goal in any Workers’ Compensation endeavor is (should be) to optimize the medical care of injured workers at the lowest possible cost. A successful industry disruptor will apply technology in new ways, thereby positively impacting cost and outcome pathways for injured workers and their employers.

Industry disruptors

Any industry disruptor technology will encounter resistance in Workers’ Compensation. However, everyone can contribute to positive industry disruption by simply being open to change. Change might mean doing things differently. It might be willingness to learn about and adopt new technology-based approaches in business operations. It might even mean willingness to love technology.

The point is, a creative new use of technology will change the way the Workers’ Compensation world is managed going forward. Industry disruptors will make that happen.

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 super-charge medical management by linking analytics to operations, thereby making them actionable. karenwolfe@medmetrics.org

 

MedMetrics Claim Risk Score is Now Available

MedMetrics®

Claim Risk Score

Scored diagnoses predict claim risk

• Each claim has a risk score based on diagnostic severity
• MedMetrics continuously monitors bill review data
• When a diagnostic risk point is reached in a claim, an alert is sent
• No guessing which claims will be problematic
• MedMetrics does it all for you!

Serious conditions and migrating claims cannot go unnoticed!

Learn more:
"A Better Way to Measure Claim Risk"

It’s easy, affordable, and POWERFUL!

Contact:
Karen Wolfe, President/CEO
MedMetrics, LLC
Workers’ Compensation Medical Analytics
541-390-1680 (v)
541-388-1422 (f)
www.medmetrics.org
karenwolfe@medmetrics.org

A Better Way to Measure Claim Risk

Insurance Thought Leadership has just published an article by Karen Wolfe of MedMetrics,
"A Better Way to Measure Claim Risk"

Where?
MedMetrics provides this diagnostic claim risk scoring tool. It's quick, easy, and affordable.
Contact: KarenWolfe@MedMetrics.org

Predict Claim Risk with Diagnostic Severity Scores

by Karen Wolfe

Predicting and measuring claim risk is an important effort in managing Workers’ Compensation claim costs. Huge sums of money are allotted to sophisticated predictive modeling initiatives hoping to tag the claims that will be the most costly. Scores of analytic professionals are put to the task and when high risk claims are identified, additional resources are applied to mitigate impending damage. Yet, one very powerful measure of claim risk remains virtually untapped and ignored by the legions of analysts.

Diagnostic codes

Every medical bill submitted for payment contains diagnostic information in the form of standard codes. The codes, assigned by the treating physician, describe the injury or illness that triggered the claim.

The codes, ICD-9 codes, are intended to justify treatment rendered and the fees charged. ICD-9’s codes are the International Classification of Diseases published by the World Health Organization (WHO). On Workers’ Compensation bills, they can tell us what the medical problem is.

Codes ignored

ICD-9 codes are part of the collected information from the bill, however, they are not well understood or used in claim management. That ICD-9 codes are ignored by claims professionals is perfectly reasonable.

ICD-9 codes on the claim are just codes. They do not contain the description of the injury and there are thousands of them. Adjusters do not have the time or inclination to search for code descriptions. Instead, they rely on the NCCI classifications of type of injury, body part, and cause. Nevertheless, neither ICD-9 codes nor NCCI classifications by themselves can define the seriousness of the medical condition.

Coding the codes

To define injury severity, individual ICD-9 codes must be graded for medical severity using a simple scoring methodology. For instance, multiple codes are used by physicians to describe back injuries and they have very different severity scores. A low back strain will not be scored as high for seriousness as a spinal cord injury. Likewise, a fracture of the tibia in a healthy young adult will have a lower severity total score than a fracture of a tibia of a 60 year old who also has diabetes.

Multiple codes on a claim

Rarely is only one ICD-9 code assigned to a claim. In fact, when a claim is complex or when recovery is slow or compromised, multiple ICD-9 codes accrue to the claim. Older claims involving many treatments over time can literally contain pages of ICD-9 codes. Each time an injured worker is referred to a new specialist, new codes are added.

Comorbidities

Comorbidities such as diabetes, heart disease, or obesity that add complexity, delayed recovery, and cost to a claim can also be tracked through ICD-9 codes. When the treating physician notes such a condition, the code will be on the bill along with the injury codes. Treating physicians should be encouraged to include comorbidity diagnostic codes because they impact recovery.

Migrating claims

Claim diagnostic scores accumulate as the claim progresses. Total diagnostic scores are tallied and monitored by the computer system. As claim diagnostic scores accrue, automatic alerts are sent when the total reaches a pre-determined set point.

Importantly, migrating claims can never go unnoticed!

Moving indicators

Claim diagnostic scores are dynamic moving indicators of risk and exposure in a claim. Electronic monitoring claim ICD-9’s continuously offers critical information about current claim risk status. The claim diagnostic risk tally remains in the system background, interfering with nothing and no one. However, when the set-point is reached, an alert is sent to the appropriate person so that action can be mobilized.

As new medical bills arrive and new diagnoses are accrued, the diagnostic risk score for a claim mounts. While not the only indicator of claim risk, diagnostic severity scoring is powerful, current information. A high diagnostic severity score absolutely predicts high claim risk and cost.

Karen Wolfe is the founder and President of MedMetrics, LLC, a Workers’ Compensation analytics company. MedMetrics offers online apps that super-charge medical management by linking analytics to operations. MedMetrics apps include Diagnostic Severity Predictive Scoring with Alerts. karenwolfe@medmetrics.org

 

Don't Expect Analytics Alone to Change Outcomes

by Karen Wolfe

Research suggests 40% of major business decisions are based not on facts, but on the manager’s gut.[1] Most of those gut-based decisions are not life-endangering. However, many of them can directly impact the organization’s viability.

In Workers’ Compensation, critical decisions are made not only by managers, but by front-line workers. Claims adjusters make course-swerving decisions every day. How accurate and timely are the decisions they make? What about the decisions made to ignore information and avoid taking action?

How are outcomes traced back to the decisions made and not made? What accountability is built into the process? What kind of decision support is available? Are any of the decisions based on objective data?

Business intelligence

Business intelligence, derived from analytics (data analysis) can inform business decisions throughout the organization. More importantly, the analytics must be infused into operations to lead to action. Only analytics that are linked to operations can consistently and positively provide decision support that create positive outcomes.

“If you really want to put analytics to work in an enterprise, you need to make them an integral part of everyday business decisions and business processes—the methods by which work gets done and value gets created.”[2]  

Sequestered knowledge

Both garden variety analytics and highly sophisticated predictive modeling are common now in many organizations. But few apply the analytics to their operational process effectively to make a significant impact on outcomes and profitability. Unfortunately, the best practice exceptions are not often found in Workers’ Compensation. Applied analytics in Workers’ Compensation, and particularly those relating to the medical aspect of claims, is rare.

In Workers’ Compensation, analytics are most often sequestered in the executive suite. Analytic results are shared at board meetings and are lavishly portrayed at marketing shindigs or annual reports. They are represented in colorful graphics while decision-makers ponder their meaning. Nevertheless, just executing and reviewing analytics has little impact on decisions made by middle managers and front line workers.

Analytics must be linked to operations to make them actionable.

Dashboards are not actionable

Dashboards have become a fashionable way to display analytic results, but they don’t link the analytics to operations. They do not change behavior. They are designed to portray conditions in the organization across a broad swath of indicators in one view.

An example is a hospital where a dashboard displays vital operational statistics including admissions and discharges for the period, average lengths of stay, and acuity rates. Dashboards are interesting and informative of business activity. The remaining question is, who should do what to incorporate the knowledge? What should be done operationally to effect the indicators going forward?

Basically, dashboards are for viewing only, and unless the organization has designed response procedures for assigned persons, the impact is negligible. Dashboards have no direct relationship with operations and no mechanism for tracking responses to the information. Changes in process are anecdotal only.

Corporate communications, regardless of how sophisticated, do not effectively translate analytic knowledge into action on the front line.

Actionable analytics

For analytics to be actionable they must be linked to, and fused into operations automatically. Front line workers must be led by the information process to take appropriate action.

The best way to do this in Workers’ Compensation is to electronically monitor the data, execute the analytics in real time, and initiate the desired actions among workers by means of an automated electronic message. This approach hurdles the communication log jam found with immediate, specific information sent directly to the person who can best act on it. 

Infusing analytics into operations requires a computerized system specifically designed to monitor and analyze all transactions and to automatically send alerts, thereby communicating the results of current analytics to the appropriate persons.

Accountability

When the computer system identifies a high risk situation in a claim, the appropriate person is automatically notified electronically. At the same time, the system should also keep an audit trail noting all claims identified, the reason, and to whom the alert was sent. The end-to-end process will infuse analytics into the process, render the process more efficient, and establish accountability.

When a person is alerted of a high risk claim, action is expected. Some organizations have formal procedures for the actions required under a specific set of circumstances. Such actions are documented so that outcomes can be traced back to the claim conditions, initiatives taken, and the persons involved. The results are exponentially improved while the data gathered in the process enhances organizational performance intelligence.

Results

Analytics by themselves cannot and will not change outcomes. But analytics linked to operations through specifically designed systems will effect both the process and outcome. Only actionable analytics create value.

Karen Wolfe is the founder and president of MedMetrics®, LLC, an Internet-based Workers’ Compensation analytics company. MedMetrics offers online medical management apps that link analytics to operations, thereby making them actionable. karenwolfe@medmetrics.org

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[1] Davenport, T. Harris, J., and Morison, R. Analytics at Work, Smarter Decisions, Better Results. Harvard Business School Publishing Corporation. 2010.

 

[2] Ibid