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California SB 863, A Guide For Building And Monitoring Networks With Intelligence, Part 2

This is Part 2 of a multi-part series on building and monitoring networks with intelligence. Part 1 can be found here. Part 3 will be published soon.

California has defined how medical networks in Workers' Compensation should be structured and managed. Part 1 of this series described how California's SB 863 LC 4616 (b) (2) and LC 4616 (b)(3) takes medical provider network directives to a new level. The key imperative is, “Every MPN must establish and follow procedures continuously to review the quality of care, performance of medical personnel, utilization of services, facilities, and costs.”

California SB 863
The emphasis on network review is a chief imperative of SB 863, effective January 1, 2013. Many directives in the bill require continuous data monitoring to discover provider and network compliance and non-compliance. Some of the directives that require continuous attention are:

  • Chiropractors are limited to a 24 adjustment maximum [LC 4600(c)].
  • MPN's must have geo-coding of network physicians, updated every four years to insure access requirements are fulfilled.
  • LC 4616 (b)(2) and LC 4616 (b)(3) state every MPN must establish and follow procedures continuously to review quality of care, performance of medical personnel, utilization of services, facilities, and costs.
  • Anyone can complain, initiate an investigation, and petition to suspend or revoke an MPN.
  • Injuries while under unapproved, non-MPN care are no longer compensable!
  • Multiple conditions of escaping the MPN, non-MPN payment, and disputes must be monitored.
  • Home Health Care must be prescribed by an MD or DO.
  • MPN's are approved for four years from date of the most recent application or modification.

Provider Performance Analysis
Medical provider performance must be analyzed and monitored not only for compliance with SB 863, but also for acknowledgement of the nuances of Workers' Compensation in the treatment process. Work loss and disability payments, return to work and modified work, claimant legal involvement, along with frequency, duration, and costs of medical services should be analyzed and scored for individual providers, groups, and facilities, whether in California or another jurisdiction.

Provider Data Issue
A problem confronting many organizations is that their medical provider data is insufficient, making accurate analysis impossible. Unfortunately, most provider records in claim systems and bill review systems is severely lacking in quality and comprehensiveness.

Until now, these records were used only to pay bills, consequently, name, address, and FEIN (Tax ID) were adequate. Now, however, because of SB 863 and increased attention to the medical portion of claims nationally, much more information is needed.

Duplicate Records
Most systems contain duplicate provider records. Slight differences in data entry create multiple records for the same provider, each associated with different claims. Under those conditions, provider analysis is inaccurate and incomplete. Such duplicate records must be scrubbed and merged before beginning performance analysis.

Medical Specialty
Medical specialty or specialties should be included in provider records in the data. Those providers certified in a specialty should be compared with others who are similarly certified. Without the provider's specialty, analysis of performance is non-specific and often misleading.

For instance, pain management doctors' performance should be compared to that of other pain management doctors, rather than dermatologists or internists. Pain management physicians often receive cases when they are growing more complex and already costly. Analyzing providers of similar specialties is a matter of comparing “apples to apples.”

Differentiating Individuals
Medical providers who are members of groups or facilities should be analyzed and selected for networks individually even if the group or facility is approved. Some believe all members of a group should be included in the MPN when the group is approved. Actually, individual members might be problematic and automatic approval should not be guaranteed.

Currently many doctors and other providers submit bills under a single Tax ID. Measuring collective performance quality is not acceptable for a network with intelligence. The way to differentiate individuals is to analyze their unique performance using specific identifiers such as the state medical license number or NPI (National Provider Identification).

Networks With ROI
Whether complying with California SB 863 or building Workers' Compensation medical networks anywhere in the country, developing quality networks will return huge savings. Medical providers, especially doctors who score poorly in comprehensive data analysis, drive complexity, high costs, and poor outcomes. Those should be avoided and injured employees should be directed to best in class doctors to receive the best medical care with the best medical and employment outcomes. The business of developing and managing Networks with Intelligence should be given high priority.

First Steps
The first step in building quality medical networks is to scrub and enhance medical provider data in the organization's systems. The next step is selecting best practice providers based on integrated and comprehensive data associated with the claim. Developing and monitoring medical networks requires analytical knowledge and technical skill. Because internal resources are often limited, a practical solution is to outsource to the experts for provider performance analytics and continuous monitoring.

Authors
Karen Wolfe collaborated with Margaret Wagner to write this article. Ms. Wagner is President and CEO of Signature Networks Plus. She is considered an expert in network selection, monitoring and management, thereby creating Networks with Intelligence™ for clients.

California SB 863, A Guide For Building And Monitoring Networks With Intelligence, Part 1

This is Part 1 of a multi-part series on building and monitoring networks with intelligence. Subsequent parts in the series will be published soon.

Background
Building a medical provider community for Workers’ Compensation can be challenging, regardless of the jurisdiction. Nevertheless, carving out a legislatively-compliant, outcome-based, quality network is doable, and the return on investment is certain.

Injured workers deserve good medical treatment while employers and payers deserve transparent and fair costs. Moreover, industry research clearly shows that poorly performing providers are costly and lead to abysmal outcomes for injured employees, their families, and employers. This article features California SB 863 regarding MPNs (medical provider networks), but the concepts apply to creating intelligent medical provider networks anywhere.

Traditional Medical Networks
Medical networks in Workers’ Comp are not new, in fact, PPOs (Preferred Provider Organizations) have been around in Workers’ Comp since the early 1990s. Traditionally, the network administrator contracts with all physicians and other treating providers available. The trade-off is that providers exchange their discounted fees for increased patient volume. However, quality of medical care measured by outcomes and acknowledgment of Workers’ Comp nuances such as return to work are not considered. Some jurisdictions have made attempts to modify this practice.

Old SB 899 — LC 4616 Medical Provider Network (MPN)
In April of 2004 the governor of California signed SB 899 into law. It addressed MPNs under section LC 4616 (d) stating “In developing a medical provider network, an employer shall have the exclusive right to determine the members of their network.”

Encouragement to analyze provider performance is clear under section LC 4616.1: “Economic Profiling means the evaluation of a particular physician, provider, medical group, or individual practice associations based in whole or in part of the economic costs or utilization of services associated with medical care provided or authorized by the physician, provider, medical group, or individual practice association.” In other words, quality and costs matter and should be analyzed and monitored.

Direction Of Care
An important opportunity in California and many other states is that employers and payers are allowed to direct care for injured employees to doctors and other medical providers in their medical provider networks. After selecting the best doctors for a network, injured workers can be directed to them, a win-win scenario.

Even in states where direction of care is not permitted, payers or employers who have intelligent networks can give injured employees information regarding who are the best-in-class doctors based on objective analysis. Doing so is a service to employees who will often make use of them in selecting a doctor.

Ramping Up — SB 863
The logic of creating an intelligent network with measureable outcomes was recently fortified with California SB 863, effective January 1, 2013. The old bill is strengthened under SB 863, LC 4616 (b) (2) and LC 4616 (b)(3) “Every MPN must establish and follow procedures continuously to review the quality of care, performance of medical personnel, utilization of services, facilities, and costs.”

Quality Control
In other words, all MPN plans must have procedures in place to continuously review the quality of care and costs for medical providers in the network. The mandate is now even stronger to evaluate and monitor medical provider performance. No longer is it adequate to contract with medical providers, print the list of providers in the network, and forget it.

However, many employers and payers are at a loss about how to analytically select and continuously review provider performance.

Intelligent Networks
Legislative mandates and industry wisdom remove the question about whether to upgrade network quality through outcome analytics and monitoring. Yet, selecting the right doctors and other providers, then monitoring, and managing an intelligent MPN is a business in itself.

Most organizations do not have the appropriate resources and should outsource to companies that focus on intelligent network design, provider selection through analytics, review, and management. The following are some details for building and managing intelligent networks, whether they are legislated or not.

Gather The Data
The way to develop an intelligent network is to select the best in class medical providers determined by analysis of actual performance demonstrated in the data. Historic data must be combined with current and continually updated data to evaluate performance now and going forward. Reviews of updated data should be frequent and regular.

Additionally, the data must be derived from a broad spectrum of sources. Workers’ Compensation organizations typically segment data into bill review data, claims, pharmacy (PBM) and other silos such as UR and Medical Case Management. All are necessary for provider performance assessment. Do not be misled by those who say bill review data is adequate to the task.

Integrate The Data
Integrate the data with claims as the focal point for a complete picture of the claim. Execute algorithms that analyze the data and score provider performance based on multiple performance indicators. Individual medical providers, groups, and facilities should all be analyzed in this regard.

Continuous data update and electronic monitoring insures network and individual provider quality going forward as prescribed in SB 863 legislation. Maximize medical network quality and cost control using analytics, thereby complying with legislation and maximizing positive benefits.

More About Building Networks With Intelligence
Part 2 of this series will add more details of California SB 863 regarding medical provider networks and how to create networks with intelligence using analytics and common sense, an imperative for all medical networks in all states.

Authors
Karen Wolfe collaborated with Margaret Wagner to write this article. Ms. Wagner is President and CEO of Signature Networks Plus. She is considered an expert in network selection, monitoring and management, thereby creating Networks with Intelligence&#153 for clients.