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When does managing medical costs pay off?

There are several cost-management products and services designed to control escalating medical costs, but determining which one is most effective can be difficult. However, the task can be simplified by analyzing one such program that has been in use for years.

Medical management intervention by registered nurses on workers' compensation cases is part of the injured worker's overall rehabilitation process. Now more than 20 years old, it is the grandparent of cost-containment services related to workers' compensation. Insurance companies began the practice by hiring industrial or public-health nurses to help injured workers in the hopes of returning them to work as soon as possible.

The reason this cost-containment program has not always been successful is that some of its key players do not understand how the process works and what goals it can realistically accomplish. Therefore, in determining the success of medical management of workers' compensation cases, it inevitably comes down to who is asked. Effective Medical Management

Medical management is most effective when it is implemented soon after the worker is injured. Once in effect, a well-run program will educate the injured worker, coordinate the various interests and parties involved with the injured worker and monitor and mold all the attitudes involved among the injured worker, employer and care providers. No doubt, medical management maintains positive attitudes among all the parties and focuses on returning the injured employee to work as soon as possible.

Effective medical management makes the most of available resources. The process saves money by decreasing initial and ongoing medical costs and, in man cases reduces the value of claims settlement. However, problems often arise because in many cases saving money is viewed negatively by the parties involved in the workers' compensation process. In other words, when it comes to medical care, it is not always a case of 'you get what you pay for.' High medical costs do not necessarily mean that the injured worker received high-quality care.

Medical management obtains appropriate levels of services for the injured worker at reasonable cost. Consequently, the injured worker obtains the best care and is thoroughly educated regarding his or her condition. The injured worker recovers faster, loses less self-esteem and is less likely to rely on a carrier, an administrator or on society at large for medical care.

Sometimes few, if any, of these positive results occur. This is due to the fact that problems arise from false expectations on the part of individuals involved in the workers' compensation process. For example, inexperienced or poorly prepared registered nurses may make subjective assessments based on objective facts or observation. When this happens, needs assessments and/or recommendations may be incorrect.

In addition, an injured worker may feel misled, confused or angered as a result of a nurse relaying erroneous information related to the claims process. Furthermore, the nurse may not understand the role of the individuals involved in the workers' compensation process, including the claims adjuster or administrator, attorneys and physicians. Inadequate knowledge regarding how these professionals interrelate in workers' compensation cases can chip away at the injured worker's positive attitude, resulting in a delay in the recovery process.

Physicians greatly influence the success or failure of the medical management process as well. Doctors may be too busy or lack the motivation to work with medical management nurses. As a result, they will not take the time to thoroughly monitor an injured worker's real progress and abilities. In addition, physicians may be unwilling to fully consider alternative jobs for the injured worker. Economic interests in the treatment of workers' compensation patients may also interfere with the medical management process.

The worker's reaction to his or her injury may also upset the medical management process. If the injured worker has ongoing physical discomfort, he or she may regard this state of health with fear and anxiety. Communication and cooperation with the medical management nurse can be difficult under these conditions. In addition, the injured worker may believe that financially he or she has more to gain by assuming a disabled posture in dealing with the claim and length of disability. It is also possible that the injured employee views the time away from work as an escape from an unpleasant job.

Attorneys have their input into the process as well. Because they do not understand the role of nurses in the program, they may view them as adversaries. They may also think that medical management threatens the potential for economic gain for their client. Additionally, the carrier or administrator may attempt to use the nurse for surveillance or to acquire additional medical information through other channels.

Measuring Success

Medical management yields the best results if the injured worker receives appropriate care from reputable sources at reasonable cost. There should also be a definite progression to the injured worker's recovery. Periods when little or no improvement is made should be short and easily explained. This is important because it motivates the injured worker to improve and diminishes the patient's loss of self-esteem. The greatest improvement to the patient's condition is achieved with little deterioration in relationships between the injured worker and his or her employer and family. Finally, the claims adjuster or administrator should believe that medical management intervention positively affected the quality and duration of treatment.

Is medical management cost-effective ? Yes, but the return on investment is elusive. There have been promises of a return of $ 1 0 for every $1 spent on medical management and rehabilitation practices, but the likelihood of this is small. Consistent criteria must be established to measure savings.

Still, the best way to measure the cost-effectiveness of medical management on workers' compensation files is to ask an experienced claims handler or administrator who has worked with several quality medical management resources. Sound medical management is effective and saves money by avoiding anger, anguish, inappropriate care, depression and greed. Inadequate or incompetent medical management, used by non-discriminating purchasers, can escalate costs and make matters worse. However, when evaluating the effectiveness of cost management programs, keep in mind that whether or not a service is effective remains the opinion of the user. RM
COPYRIGHT 1990 Risk Management Society Publishing, Inc.
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1990 Gale, Cengage Learning. All rights reserved.

Article Details
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Author:DeMumbrum, Jack
Publication:Risk Management
Date:May 1, 1990
Previous Article:Rehabilitating workers' comp using cost containment.
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