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Complex Claims

Helping Injured Workers Live Their Best Lives

Providers are developing new strategies for keeping up with advances in prosthetics and finding the best options for injured workers.
By: | May 2, 2017 • 7 min read

Experts are finding ways to mitigate the challenges of workers’ compensation claims involving the use of prosthetics, given the rising costs of ever-more complex devices — and the potential for psychosocial impacts and comorbidities.

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One Call Care Management this month announced the launch of its prosthetics clinical review program, in which a prosthetist certified by the American Board for Certification will assist claims adjusters in understanding the complexities of prosthetics and in making the most informed decisions about them.

Referrals meeting one or more of the following criteria will typically trigger such reviews:

  • myoelectric upper extremity systems
  • system upgrades and/or excessive replacements
  • microprocessor-controlled knee and ankle prosthetics; and
  • excessive socket changes

Recent case studies have shown savings of up to 52 percent when clinical reviews are added to the claims approval process, according to One Call.

Jennifer McCarthy, a One Call clinical specialist based in Boston who will lead the new team, said that clinical reviews are needed because claims costs continue to rise as advances in prosthetics happen so rapidly that carriers can’t keep track of the changing technology.

“Historically in times of war or conflict that involves our military, the U.S. government awards grants to researchers to develop prosthetic technology, so we have seen a recent influx of advanced prosthetic devices,” McCarthy said.

“Because the devices often can involve robotics, they are expensive to manufacture at such a small quantity. The manufacturers then to transfer the costs of research, development and manufacturing onto the provider and payer.”

Jennifer McCarthy, clinical specialist, One Call Care Management

Moreover, since some of the devices are so new, there is no set fee schedule from Medicare, she said. The manufacturers can suggest a retail price for the providers to bill or the providers will charge an amount above their invoice costs.

“They attempt to make this pricing somewhat standardized, but there can often be a significant variance in the pricing between providers for the same device,” McCarthy said.

One Call’s prosthetics clinical review program is different than a utilization review, which verifies the medical necessity of the device being recommended from a nurse’s perspective.

“Our new program is more of a clinical oversight from a prosthetist’s perspective to make sure the recommendation is truly appropriate and there are no other types of prostheses that would allow for a better outcome,” she said.

“Our goal is to ensure that the device the prosthetist is recommending is appropriate for the patient’s functional level and will allow the individual to reach his vocational and avocational goals.”

Outreach to the prosthetist involved in the claim is often necessary to determine what other types of prostheses were considered and why they would not be appropriate, McCarthy said.

“If local expertise and resources are not available, it is sometimes more advantageous to send the patient to a center with expertise to minimize the risk and costs associated with ‘trial-and-error’ approach to prosthesis management.” — Julie Fawson, director of clinical services, Paradigm Outcomes

Sometimes the team will come to the conclusion that an alternate device may be more appropriate or there might be coding changes that more accurately represent the device recommendations, which can reduce costs.

In determining the most appropriate device, One Call’s team will also consider the health history of the injured worker, what their experiences have been with any previous prostheses and the environmental history — which includes the worker’s support system, home and social environments.

“This gives us a more holistic approach to determining whether this particular prosthesis would allow them to reach their highest functional level,” McCarthy said.

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Upon request from claims adjusters, One Call will create a prosthetics cost projection document covering the costs of maintenance, servicing and replacement for the particular device.

The company already has a clinical review program for physical therapy and dental, so prosthetics is “the next natural progression of providing clinical oversight to our customers,” she said.

Julie Fawson, RN, director of clinical services at Paradigm Outcomes in Walnut Creek, Calif., said that workers’ comp carriers face many challenges when planning for an injured worker’s prosthesis needs, especially in the current environment of rapidly advancing technology and cost of prosthetics.

“Our team defines broad achievements, such as returning to work, and detailed goals that focus on specific areas of function,” she said.

When reviewing claims involving prosthetics, Paradigm Outcomes considers the complexity of the amputation; impact of comorbidities and conditions; the expertise and resources of the treatment team; and the management of the patient’s needs and expectations.

“In general, the more proximal the amputation, the more complex and costly it can be,” she said.

“For example, an above-elbow amputation is more complex than a below-elbow amputation. While in both scenarios the amputee may be a candidate for body-powered and myoelectric prosthesis options, fabricating a prosthesis that incorporates elbow function is much more significant in terms of cost, therapy/training, maintenance and functional recovery expectations.”

It is also important to consider comorbidities or conditions that may add to the complexity of amputation and prosthesis management, Fawson said. For instance, a patient with extensive muscle or nerve tissue damage at the amputation site, or with a very short residual limb, will be more complex in terms of fabrication, fit and function of the prosthesis.

A patient could also require reconstructive surgeries of the residual limb over time, which will change the composition of the residual limb, thereby increasing the frequency of costly socket revisions in the first couple of years.

Complexity on Many Levels

In all prosthestics claims, expertise of the treatment team — the physician, therapist and prosthetist — and the resources they provide, are vital to the success of managing complex amputees, especially given the high technology, high cost prosthesis options available today, she said.

“If local expertise and resources are not available, it is sometimes more advantageous to send the patient to a center with expertise to minimize the risk and costs associated with ‘trial-and-error’ approach to prosthesis management,” Fawson said.

It is also important to understand the patient’s occupational goals, lifestyle and avocational interests, to guide the treatment team and patient to make the most appropriate prosthesis choice that will optimize the patient’s functional and psychological outcome, she said.

Julie Fawson, director of clinical services, Paradigm Outcomes

To alleviate the challenges of locating qualified providers of prosthetics, Memphis-based Sedgwick Claims Management Services Inc. developed a provider benchmarking tool to help identify providers who are known for consistently delivering high quality care and desired outcomes, said Kimberly Talton, a Sedgwick complex claims advisor based in Dallas.

“Another challenge is determining what to expect when it comes to amputees’ ongoing needs and care,” Talton said.

“Within the complex claims unit, we work with the team to provide education about critical care pathways to identify what to expect with these types of injuries, ongoing needs and costs of these types of claims.”

One of the challenges is determining the appropriate type of prosthetic for a particular person, as every individual and amputation is unique, said Riverside, Calif.-based Edward Canavan, vice president of Sedgwick’s workers’ compensation practice and compliance.

“Some individuals with amputation could end up being diabetic, and so they’ll have different needs than other amputees,” Canavan said.

“We want to get individuals to the right doctor who can give them the right recommendation to fulfill those needs, and then we can partner with the individuals to get them the right prosthetics.”

Other challenges are centered around the fast-paced evolution of technology for prosthetics, and determining whether the medical and peer review guidelines allow the use of particular devices that have recently been developed, he said.

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“There is so much research going on in every sort of prosthetic to help the injured worker, including the development of devices to feel what they are touching, exoskeleton research to help the person walk again, and stem cell therapy,” Canavan said.

“We need to balance that with determining what can help the injured person get the best possible outcomes. That’s where complex claims review comes into place. We can also leverage the right resources such as a prosthetics clinical review program.”

Prosthetics claims can be impacted if the affected amputation area hasn’t healed properly and completely before being fitted, said Rachael Ruther, a Sedgwick complex claims advisor based in Brea, Calif.

“Prosthetics are so specialized,” Ruther said.

“You want to be sure there is a proper fit; otherwise, the prosthetic may not be functional and may go unused.”

The key to providing the best care possible is to get patients as close to a normal level of functionality as possible, Talton said.

“Hopefully we can reduce some of the mental issues that come with these types of injuries such as depression and anxiety,” she said. &

Katie Kuehner-Hebert is a freelance writer based in California. She has more than two decades of journalism experience and expertise in financial writing. She can be reached at [email protected]

More from Risk & Insurance

More from Risk & Insurance

2018 Risk All Stars

Stop Mitigating Risk. Start Conquering It Like These 2018 Risk All Stars

The concept of risk mastery and ownership, as displayed by the 2018 Risk All Stars, includes not simply seeking to control outcomes but taking full responsibility for them.
By: | September 14, 2018 • 3 min read

People talk a lot about how risk managers can get a seat at the table. The discussion implies that the risk manager is an outsider, striving to get the ear or the attention of an insider, the CEO or CFO.

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But there are risk managers who go about things in a different way. And the 2018 Risk All Stars are prime examples of that.

These risk managers put in gear their passion, creativity and perseverance to become masters of a situation, pushing aside any notion that they are anything other than key players.

Goodyear’s Craig Melnick had only been with the global tire maker a few months when Hurricane Harvey dumped a record amount of rainfall on Houston.

Brilliant communication between Melnick and his new teammates gave him timely and valuable updates on the condition of manufacturing locations. Melnick remained in Akron, mastering the situation by moving inventory out of the storm’s path and making sure remediation crews were lined up ahead of time to give Goodyear its best leg up once the storm passed and the flood waters receded.

Goodyear’s resiliency in the face of the storm gave it credibility when it went to the insurance markets later that year for renewals. And here is where we hear a key phrase, produced by Kevin Garvey, one of Goodyear’s brokers at Aon.

“The markets always appreciate a risk manager who demonstrates ownership,” Garvey said, in what may be something of an understatement.

These risk managers put in gear their passion, creativity and perseverance to become masters of a situation, pushing aside any notion that they are anything other than key players.

Dianne Howard, a 2018 Risk All Star and the director of benefits and risk management for the Palm Beach County School District, achieved ownership of $50 million in property storm exposures for the district.

With FEMA saying it wouldn’t pay again for district storm losses it had already paid for, Howard went to the London markets and was successful in getting coverage. She also hammered out a deal in London that would partially reimburse the district if it suffered a mass shooting and needed to demolish a building, like what happened at Sandy Hook in Connecticut.

2018 Risk All Star Jim Cunningham was well-versed enough to know what traditional risk management theories would say when hospitality workers were suffering too many kitchen cuts. “Put a cut-prevention plan in place,” is the traditional wisdom.

But Cunningham, the vice president of risk management for the gaming company Pinnacle Entertainment, wasn’t satisfied with what looked to him like a Band-Aid approach.

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Instead, he used predictive analytics, depending on his own team to assemble company-specific data, to determine which safety measures should be used company wide. The result? Claims frequency at the company dropped 60 percent in the first year of his program.

Alumine Bellone, a 2018 Risk All Star and the vice president of risk management for Ardent Health Services, faced an overwhelming task: Create a uniform risk management program when her hospital group grew from 14 hospitals in three states to 31 hospitals in seven.

Bellone owned the situation by visiting each facility right before the acquisition and again right after, to make sure each caregiving population was ready to integrate into a standardized risk management system.

After consolidating insurance policies, Bellone achieved $893,000 in synergies.

In each of these cases, and in more on the following pages, we see examples of risk managers who weren’t just knocking on the door; they were owning the room. &

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Risk All Stars stand out from their peers by overcoming challenges through exceptional problem solving, creativity, clarity of vision and passion.

See the complete list of 2018 Risk All Stars.

Dan Reynolds is editor-in-chief of Risk & Insurance. He can be reached at [email protected]