Portrait of a Smart Medical Provider Network in Workers' Comp

Network administrators are gradually stepping up to the challenge of shifting to smart networks. Momentum toward smart networks will be exponential with payer participation, resulting in quality improvement and cost control all around.

Smart is cool, especially in electronics. Smart phones answer their users' most obscure questions instantly. Computers are smart, as are iPads, some TVs and even children's toys. So why can't workers' compensation medical provider networks be smart?

If they were, what would that look like?

Portrait of a Smart Medical Network

A smart medical network contains only the best doctors and other medical providers, those who drive the best results for injured workers and their employers. Moreover, a smart network does not rely on discounts on services as the requirement for participation. Instead, demonstrated positive outcomes are the qualifier for medical provider participation and continuing excellence.

Smart Networks Are Local

A network containing thousands of doctors is of no value to the injured worker. Workers need the closest provider who will treat them effectively and return them to work. The worker’s employer likewise needs the best local provider who will return the worker to pre-injury status in the shortest amount of time at the least cost. Smart networks are composed of this kind of medical doctors.

Network Participation Qualifiers

Smart networks are built by objectively measuring the performance of physicians who have actually treated injured workers. Objective evidence of performance is found in the data. Yet, indicators of performance are typically ignored in traditional networks. They do not measure or monitor the quality of provider performance. They simply contract with any providers and add them to the network directory.

Indicators of Quality

Many indicators of performance found in the data can be used to measure the level of provider performance. In the case of medical treatment of injured workers, the most telling indicators reveal doctors’ awareness and acknowledgement of the nuances of workers’ compensation that ultimately benefit both injured workers and their employers.

Revealing data elements influenced by the treating physician include return to work, medical costs, indemnity payments, legal involvement and disability status at the close of the claim. These outcome indicators in the data are important markers of quality and legitimate criteria for evaluation. Algorithms are executed using the indicators, and providers are scored based on their performance. Performance measurement must be objective and consistent. But performance measurement cannot end there.

Continuous Monitoring

To ensure continued quality, the data must be continuously monitored. Unlike traditional medical networks that contract for discounts with medical providers and go no further, smart medical networks for workers’ compensation continue to monitor for quality. Continuous monitoring is the very definition of medical management:

Good management is making sure what you did stays done!

California SB 863

In fact, California SB 863, effective Jan. 1, 2014 (now!), mandates continuous monitoring of medical provider costs and quality performance. This progressive legislation is an excellent model for selecting and monitoring smart medical networks, regardless of geographic location.

Establishing a smart medical network is essential, and the means are clear and available. However, the transition from traditional networks to smart medical networks can be tricky.

Converting to Smart Networks

Traditional networks are tethered to their established means of revenue generation. Shifting from the discount network model to the smart medical network model is challenging. The most practical approach is initially combining the two models, then weaning from the old model over time.

If the right physicians are a part of a smart medical network, claim outcomes will improve. Injured workers will receive good medical treatment and return to work early and successfully, and costs will be significantly reduced.

Moreover, physicians and other providers who qualify for smart networks should be rewarded. They should not have their fees reduced by discounts. Based on the excellence of their past performance, they should be included in the smart network on a very long leash. Continued performance for continued participation will be monitored scrupulously.


Nevertheless, it should be noted, payers have an obligation to participate in the transition to, and continuation of, smart networks by recognizing and paying for value received. Networks need support and cooperation from payers to integrate and analyze their data, score provider performance and realign medical provider preferences. The benefits will accrue to everyone: payers, networks, employers and injured workers.

Data Participation

Importantly, to achieve optimum results, data must be gathered from multiple sources and integrated for comprehensive claim analysis. Data from only one source, such as bill review, is sorely deficient for accurate analysis of medical provider performance. Claim system and pharmacy data must be added to bill review data at a minimum. Shortcuts in data gathering and analysis are not defensible.

Change Momentum

Network administrators are gradually stepping up to the challenge of shifting to smart networks. Momentum toward smart networks will be exponential with payer participation, resulting in quality improvement and cost control all around.

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