Tag Archives: health reform

healthcare

Future of Work Comp Healthcare Delivery

Reform is changing healthcare delivery models, but there is a large gap between the healthcare related to workers’ compensation and the group health approach.

As a result of healthcare reform, the industry has experienced significant consolidation of health systems and medical practices, with an added emphasis on patients as consumers of healthcare, all as providers continue to evolve. As employers, though, our message is confused.

We tell employees that we have a great healthcare system for them, encourage them to choose the best physician to meet their needs and remind them to get regular checkups. However, if an employee gets injured, we have a separate system with a separate set of doctors and a separate set of rules.

If employers can find better doctors to treat workers, they can improve the quality of the workers’ compensation system. Employers are not going to get better doctors just by paying more; but, if they can identify which doctors are doing a better job and reward them, results improve.

California’s model has been experimenting with the concept of rewarding doctors for providing superior care, which has resulted in significant cost reduction. Great doctors are actually reducing the amount of medical attention required and, overall, workers’ compensation claims costs. As a result of better care and employee satisfaction, litigation costs have also dropped. Quality matters.

With advancements in technology, reimbursement models, a focus on quality and the movement of connected care, health systems across the U.S. are offering accountable care organizations (ACOs) for employer benefit solutions. Many think mergers and consolidation are a bad thing, however, in this consolidated world where health systems have changed, mergers and consolidation are changing “well care” to “sick care.” By taking a holistic approach, you are able to take a patient from wellness to injury care. Workers’ compensation needs to be part of this discussion. If not, we cause an even greater divide.

This holistic approach is not a new concept. In the 1990s, there were three 24-hour care pilot programs that tried this approach and resulted in lowered cost and improved medical control. At the same time, 10 states also mandated 24-hour pilot studies. Employers generally liked the pilot programs, which resulted in benefits such as increased medical control and reduced costs. On the national front today, the National Institute for Occupational Safety and Health (NIOSH) has a total worker health program that considers the total person and the factors that affect the individual’s health. The workers’ compensation system could borrow and apply successful elements from these programs.

When you send an injured worker to the best and brightest, you make the workers and their families feel like you are treating them well. This gets the patient to do what the doctor wants and stops the unfortunate spiral of delays in care. Technology is going to refine this approach even further. Technology will enable patients to get in touch with doctors immediately and will make the worker feel like he was properly cared for. This has the potential to be extremely effective and efficient for the system.

When a connected care system is not in place, the gaps in care are leading to needless disability and extended absence. Technology and telemedicine are essential components of this connected care. Gathering and analyzing health data is also important to drive positive behavior and improve overall quality of care.

The patient base is also more complicated, and that is where finding the great doctor comes into play. Today, if you have a patient with a broken arm, you may, in fact, have a patient with a broken arm and diabetes, which is much more difficult to treat. We need to find these great doctors and find systems for them to work with that operate far more efficiently. Technology is a very big part of that.

The current workers’ compensation system is not set up to reimburse for payments under this new model, including the use of nurse practitioners and physician’s assistants. The system needs to move in this direction. There are simply not enough physicians to see everyone. These healthcare professionals are essential elements of the group system, and the workers’ compensation system could be improved significantly by recognizing the need for these important providers.

Workers’ compensation currently works in silos, and that is an obstacle. The health system ACO model is communicating directly to the employers. As this model becomes adopted, the board room is not seeing the financial benefits just yet. However, when employers decide they want change, change happens. It is just a matter of getting their attention.

Employers are paying attention to the data they receive on the types of health systems. If the data around what is working in group health becomes available to employers, they will evolve.

Holistic care is certainly a trend that is largely becoming a reality. Workers with sedentary lifestyles who become injured on the job bring complicated connections between injury and pre-existing conditions that are hard to separate. It makes sense to treat people as they are—as a whole person. It is very important to try to get all of the systems to work together to treat the employee as one person.

We need a network that drives total employee health, and we can only have that if group health and workers’ compensation can talk to each other. Data is going to drive this evolution. The best-case scenario is if all this wonderful science and data can be put to use to help patients and merge what currently are parallel systems.

These issues were discussed in more details during an Out Front Ideas with Kimberly and Mark webinar, which was broadcast on Sept. 30, 2015. The archived webinar can be viewed here.

Medicaid Expansion – A Hand Up Or A Handcuff?

Medicaid has several components, but at its core it is a health insurance program for the poor. States can differ, but most provide for those below the poverty level. Federal health reform requires expanding Medicaid to those earning up to 138% of the poverty level (about $25,000 for a family of 3). The U.S. Supreme Court has ruled that each state can accept or reject the expansion of Medicaid. Like other states, Georgia must make that choice. This analysis addresses the human impact — not state financing, our national debt, or deficit spending. The key question: Is Medicaid expansion beyond the poverty level a “hand up” or a “handcuff?”

Unlike other income levels in America, getting ahead is less likely if you are in the bottom 20%. The Economic Mobility Project of the Pew Charitable Trusts shows 65% of children born in the lowest 20% of incomes stay in the bottom two quintiles.

Upper Limit of U.S. Income Quintiles: 2010
Lowest 20% Second 20% Third 20% Fourth 20% Lower limit of top 5%
$20,000 $38,043 $61,735 $100,065 $180,801

If the core philosophy of Conservatives is producing upward economic mobility and Progressives are for helping the poor, why have both ideologies failed the poorest among us? Scott Winship, a researcher at the Brookings Institute has said, “The bottom 20% in the U.S. looks very different from the bottom 20% in other countries.” Americans are more likely than foreign peers to grow up with single mothers. In poor communities, drugs, alcohol, violence, and ineffective primary and secondary schools represent a huge barrier to economic mobility. The United States also has uniquely high incarceration rates, and a longer history of racial stratification.

With all those challenges, the Brookings study showed that regardless of race or ethnic background, if you stay in school at least through high school, don’t have a child until you’re married and over 21, and work full-time at any job, your chances of being poor are only 2 percent and your chances of joining the middle class are 74 percent.

More than other countries, poor Americans have to educate and work their way up from the lower levels. The United States provides many benefits for the poor, disabled, and unfortunate. No one of any rational political or ideological persuasion is opposed to helping those in need.

The key part of Medicaid is also called “Temporary Assistance for Needy Families” or TANF. Under health reform Medicaid would be expanded to 18-20 million new lives. Other health reform subsidies through exchanges are available up to 400% of the poverty level (about $92,000 for a family of 4). Programs affecting larger percentages of the population can create an attitude of entitlement and a culture of dependency that traps segments into intransigent generational poverty.

A study of entitlement programs in Colorado illuminates the concerns for Georgia and other states. Programs are available to low income families to provide housing, food, healthcare, educational, and other subsidies. A single mother with two children making $25,000 could be eligible to receive about $18,000 in government benefits.

Maximum Available Tax and Benefit Programs

Medicaid expansion and other health reforms add new subsidies for low and middle income families. Using the same example of a single mother with two children, Medicaid expansion to 138% of the poverty level can provide an additional $7,500 in benefits to those making $25,000.

Health Benefits

What are the effects on real people as they try to advance economically? The marginal effective tax rate from federal income taxes, payroll taxes, and state income taxes, for a single mom with two children earning $25,000 is about 29.4 percent. If one includes other programs, SNAP (food stamps), state children’s health insurance program, and the new health reform subsidies, the marginal tax rate rises to 54.5 percent.

If benefits like Temporary Assistance for Needy Families, federal housing subsidies, and WIC (nutritional program for Women, Infants, and Children) are considered, the marginal tax rate is as high as 81.9 percent because families lose even more benefits due to higher earnings.

Who would work harder, take that extra job, or seek a promotion when most of the added earnings would be taxed away or government benefits are reduced? The destruction of initiative can be the inevitable consequence of expanding Medicaid with an additional $7,500 (for a total of over $18,000) to someone making $25,000, but providing nothing to a similar family making $75,000.

Clearly, even the most compassionate among us can see that accumulated effects of entitlement programs can break the spirit of personal responsibility and the motivation for upward mobility. Medicaid expansion and the new health reform subsidies to over 50% of the population are likely to produce the same dependence and economic barriers to upward mobility already evident in the lower 20%.

The standard of living in Georgia is directly related to its citizens’ ability to produce goods and services others want to purchase. Subsidizing able-bodied populations does not create economic growth for those individuals or for the state. In our compassion to help those in need, we tend to look away from the politically driven expansion of those programs and the debilitating dependency culture they enable. Georgia has apparently decided not to play that destructive game. Good for us.

As we look to the future and better ways to solve the problems of healthcare and health insurance, maybe Georgia can create an island of opportunity within a sea of growing dependency. Maybe we can remove the handcuffs of those chained to the programs and ideas of the past and offer a hand up rather than a handout.