Quality-Based Care

Bundled Care’s Place in Workers’ Comp

Bundled care programs are one alternative care model emphasizing quality over quantity.
By: | August 8, 2016 • 5 min read

Medicare continues wielding its leverage to push the nation’s medical systems away from fee-for-service arrangements toward alternative payment models expected to improve care quality.

But one mainstay alternative medical treatment model — bundled care— is off to a slow start in workers’ compensation as implementation hurdles remain.

Very few bundled care models have emerged for treating injured workers. Yet workers’ comp experts expect that the bundled payment concept will eventually flow into more treatments for workplace injuries.

Jacob Lazarovic, senior VP and chief medical officer, Broadspire

Jacob Lazarovic, senior VP and chief medical officer, Broadspire

“I think we will get there,” said Jacob Lazarovic, senior VP and chief medical officer at Broadspire, a third party administrator with a large workers’ comp book of business.

“There will be models that work,” he continued. “There will be entities that manage to put it together. I am pretty sure we are going to see an expansion of programs,” including a potential bundled care program Broadspire is developing for injured worker outpatient surgeries.

Bundled care and bundled payment refers to the coordinated delivery of all medical provider services needed to address a specific illness or injury. A medical group or hospital, for example, would bundle all services including imaging, anesthesia, surgery, follow-up doctor visits and physical therapy for repairing a knee or hip.

They would do so for one single bundled fee that includes financial incentives holding providers accountable for quality outcomes.

In contrast, under fee-for-service arrangements that dominate U.S. health care, claims payers receive bills for each patient interaction with a provider, encouraging treatment quantity over quality.

But Medicare is aggressively pushing nationwide adoption of value-based care delivery models, including bundled care. By the end of 2018, Medicare wants half of its payments flowing to alternative payment models.

The Centers for Medicare and Medicaid Services continues unfurling mandates to make that happen. In July, it announced that hospitals in nearly 100 markets would be accountable for the financial and quality outcomes associated with bypass surgeries and heart attacks.

By bundling care for those treatments Rising provides insurers, TPAs and self-insured employers greater cost predictability, administrative efficiency, and “concierge” level of service” for injured worker.

That follows a 2015 announcement impacting nearly 800 hospitals with a mandate for bundled programs for hip and knee replacements.

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Experts frequently cite the government efforts among reasons they expect bundled payments will eventually spread from Medicare arrangements to private contracts such as those arranged to care for group health and workers’ compensation claimants.

Medicare’s efforts, for example, should help accustom medical provider groups to contracting with each other to arrange bundles.

“With Medicare we’ve seen quick diffusion of bundled payments,” said Shawn Matheson, a manager at Leavitt Partners, a health care consultant and intelligence firm. That will help private industry claims payers evaluate CMS challenges and successes as a base for additional program designs, Matheson added.

Developing Bundled Programs

For now, though, several workers’ comp observers said they can only cite two or three existing bundled care programs for treating worker injuries while other efforts are under development.

Treatment at the University of California Los Angeles’ Center for Behavioral & Addiction Medicine, for instance, is available through a bundled care program that R&Q Healthcare Interests arranged for workers’ comp claims payers.

“But it is important to recognize there are some difficult problems to be solved in comp that start with return to work and how you hold people accountable.” — David Deitz, managed care expert, David Deitz and Associates

R&Q’s program for injured worker pain and addiction treatment is the first bundled offering the company expects to develop under an existing contract it has with the entire University of California system, said Bill Lape, CEO at R&Q Healthcare, a unit of Randall & Quilter Investment Holding Ltd.

Broadspire, meanwhile, teamed up with a medical network provider to explore developing a pilot program of ambulatory surgery facilities offering bundled services for injured-workers, Lazarovic said.

Robert Evans, VP of repricing solutions, Rising Medical Solutions

Robert Evans, VP of repricing solutions, Rising Medical Solutions

Ideally, the arrangement would allow the collection of metrics for measuring outcomes such as patient satisfaction and return to work.

And Rising Medical Solutions now offers workers’ comp surgery care programs in regions of Illinois, Florida, New Jersey and Georgia. Those regions generally experience greater variation than normal in the pricing of routine surgeries for treating problems such as knee injuries and carpal tunnel syndrome, said Robert Evans, VP of repricing solutions at Rising.

By bundling care for those treatments Rising provides insurers, TPAs and self-insured employers greater cost predictability, administrative efficiency, and “concierge” level of service for injured workers, Evans said.

Evans will speak in November at the National Workers’ Compensation and Disability Conference & Expo in New Orleans as part of a panel discussion on strategies for bringing value-based care, like bundled arrangements, to workers’ comp.

Broadspire’s Lazarovic will also speak at NWCDC during a presentation titled “How to Use a Medical Expert So You Don’t Get Burned on Causation.” The conference agenda is available at www.wcconference.com.

Fee-for-service’s entrenchment in workers’ comp medical care, meanwhile, and work comp’s emphasis on issues that don’t exist in group health, like return to work, are slowing adoption of bundled care for injured workers.

David Deitz, managed care expert, David Deitz and Associates

David Deitz, managed care expert, David Deitz and Associates

Bundling care for ailments commonly diagnosed among injured works, like carpal tunnel syndrome, would be straight forward, said David Deitz, a managed care expert at David Deitz and Associates. But holding medical providers accountable for return to work remains a challenge.

Accountability could be difficult to enforce if, say, medical providers repair a worker’s injury as expected, but for some other reason the employee decides not to return to the job, Deitz elaborated.

“I think there is a really difficult problem here [but] it’s not insolvable,” Dietz said. “But it is important to recognize there are some difficult problems to be solved in comp that start with return to work and how you hold people accountable.”

Other obstacles to implementing bundled programs for injured workers include work comp’s state-by-state regulation and entrenched reliance on medical fee schedules based on fee-for-service arrangements.

Roberto Ceniceros is senior editor at Risk & Insurance® and chair of the National Workers' Compensation and Disability Conference® & Expo. He can be reached at [email protected] Read more of his columns and features.

More from Risk & Insurance

More from Risk & Insurance

Risk Management

The Profession

After 20 years in the business, Navy Pier’s Director of Risk Management values her relationships in the industry more than ever.
By: | June 1, 2017 • 4 min read

R&I: What was your first job?

Working at Dominick’s Finer Foods bagging groceries. Shortly after I was hired, I was promoted to [cashier] and then to a management position. It taught me great responsibility and it helped me develop the leadership skills I still carry today.

R&I: How did you come to work in risk management?

While working for Hyatt Regency McCormick Place Hotel, one of my responsibilities was to oversee the administration of claims. This led to a business relationship with the director of risk management of the organization who actually owned the property. Ultimately, a position became available in her department and the rest is history.

R&I: What is the risk management community doing right?

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The risk management community is doing a phenomenal job in professional development and creating great opportunities for risk managers to network. The development of relationships in this industry is vitally important and by providing opportunities for risk managers to come together and speak about their experiences and challenges is what enables many of us to be able to do our jobs even more effectively.

R&I: What could the risk management community be doing a better job of?

Attracting, educating and retaining young talent. There is this preconceived notion that the insurance industry and risk management are boring and there could be nothing further from the truth.

R&I: What’s been the biggest change in the risk management and insurance industry since you’ve been in it?

In my 20 years in the industry, the biggest change in risk management and the insurance industry are the various types of risk we look to insure against. Many risks that exist today were not even on our radar 20 years ago.

Gina Kirchner, director of risk management, Navy Pier Inc.

R&I: What insurance carrier do you have the highest opinion of?

FM Global. They have been our property carrier for a great number of years and in my opinion are the best in the business.

R&I: Are you optimistic about the US economy or pessimistic and why?

I am optimistic that policies will be put in place with the new administration that will be good for the economy and business.

R&I: What emerging commercial risk most concerns you?

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The commercial risks that are of most concern to me are cyber risks, business interruption, and any form of a health epidemic on a global scale. We are dealing with new exposures and new risks that we are truly not ready for.

R&I: Who is your mentor and why?

My mother has played a significant role in shaping my ideals and values. She truly instilled a very strong work ethic in me. However, there are many men and women in business who have mentored me and have had a significant impact on me and my career as well.

R&I: What have you accomplished that you are proudest of?

I am most proud of making the decision a couple of years ago to return to school and obtain my [MBA]. It took a lot of prayer, dedication and determination to accomplish this while still working a full time job, being involved in my church, studying abroad and maintaining a household.

R&I: What is your favorite book or movie?

“Heaven Is For Real” by Todd Burpo and Lynn Vincent. I loved the book and the movie.

R&I: What’s the best restaurant you’ve ever eaten at?

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A French restaurant in Paris, France named Les Noces de Jeannette Restaurant à Paris. It was the most amazing food and brings back such great memories.

R&I: What is the most unusual/interesting place you have ever visited?

Israel. My husband and I just returned a few days ago and spent time in Jerusalem, Nazareth, Jericho and Jordan. It was an absolutely amazing experience. We did everything from riding camels to taking boat rides on the Sea of Galilee to attending concerts sitting on the Temple steps. The trip was absolutely life changing.

R&I: What is the riskiest activity you ever engaged in?

Many, many years ago … I went parasailing in the Caribbean. I had a great experience and didn’t think about the risk at the time because I was young, single and free. Looking back, I don’t know that I would make the same decision today.

R&I: What about this work do you find the most fulfilling or rewarding?

I would have to say the relationships and partnerships I have developed with insurance carriers, brokers and other professionals in the industry. To have wonderful working relationships with such a vast array of talented individuals who are so knowledgeable and to have some of those relationships develop into true friendships is very rewarding.

R&I: What do your friends and family think you do?

My friends and family have a general idea that my position involves claims and insurance. However, I don’t think they fully understand the magnitude of my responsibilities and the direct impact it has on my organization, which experiences more than 9 million visitors a year.




Katie Siegel is an associate editor at Risk & Insurance®. She can be reached at [email protected]