Innovations in Workers’ Compensation Managed Care

Posted on 05.03.18

By Linda Lane, President of Harbor Health Systems

I was recently invited to moderate a panel on innovation for the Southern California Chapter of the Case Management Society of America (CMSA). The case managers who attended the event were all versed in the challenges of managing complex work-related injuries, and they were eager to hear about the latest innovations that could help them better coordinate care and enhance outcomes for the injured workers they assist.

The panel of experts discussed the latest high-tech capabilities, barriers to adoption, and the importance of measuring the benefits gained from these new systems. I walked away with four takeaways from moderating this panel:

Technological innovations can streamline healthcare delivery
A significant portion of our discussion came to focus on the emergence of telemedicine – a term often used interchangeably with telehealth. This trend is not just a future scenario. It’s already making tangible inroads, particularly with relatively minor injuries, and it has the potential to further transform workers’ compensation care – from the point of injury through rehabilitation and return to work. Using digital technologies, the industry is able to electronically connect injured workers to quality providers. This physician-patient interaction occurs via video conferencing on smart phones, tablets and other devices.

Although telehealth costs the same as an in-person visit, there are many potential benefits, including reduced utilization, improved patient compliance, immediate triaging of injuries, improved access to care, high patient satisfaction with the care experience, faster claims closure, reduced likelihood of litigation, and eliminating travel and office wait times.

According to the American Medical Association, 70% of clinical encounters could successfully be performed through telemedicine. Thus far, injured workers have reported a positive experience with telemedicine. In addition, there are other forms of tele-services being implemented, including telerehabilitation, tele-PT, remote patient monitoring and tele-interpretation – all with early signs of delivering value for workers’ comp care.

When it comes to new therapies, we need to employ a broader perspective, one with a holistic view of costs and outcomes
Of course, adopting newfangled treatment options must be approached with care and with an eye toward limiting risk through well-defined pilot programs. However, getting to this place often requires a leap of faith, especially within an industry that has traditionally focused on reducing costs at the unit level.

This type of strategy lends itself to a catch-22 dilemma. We may deny authorizations for new treatments and therapies because there isn’t enough data to prove the benefits, but we can’t see the benefits if we don’t give new treatments and therapies a try. This is where a well-defined pilot program can help advance our understanding of how and when to employ new treatment options.

In this scenario, payers move away from obsessing over unit costs and toward broadening their analysis of value. Within this approach, they may consider new therapies that add cost but could improve outcomes when the whole claim’s picture is considered. For example, genetic testing adds an expense, but it may also allow treating physicians to see how injured workers would respond to various opioid medications, including their risk of dependency to these drugs. Likewise, use of virtual reality might add costs, but it has the potential to revolutionize pain management. Carefully constructed pilot programs allow us to test new options and demonstrate value. We identify the types of claims most likely to benefit, apply the program, and measure the impact. If we see overall savings and improved outcomes, use of these therapies might be broadened to other claims that could also benefit.

Advanced analytics must be in place to ensure the basic tenets of quality providers and quality care
There are ongoing challenges in identifying and selecting the highest quality providers who can successfully expedite treatment, recovery, and return to work for injured workers. Use of analytics is instrumental to finding and measuring the high performers. Results go beyond what’s achievable through network utilization because quality measures strive to enhance the network itself, by pinpointing and using the best performers. In fact, we should apply analytics across a broader array of provider services, raising the bar on quality, costs, and outcomes to new heights.

Benchmarking and scoring are the first steps in identifying high performers. When these tools are used as an overlay to PPO management, we can automatically ensure regulatory compliance and direct injured workers to quality physicians. Using these methods, payers are seeing outstanding results through reduced costs and improved outcomes.

With analytics, we must examine different variables, such as cost of treatment, duration of treatment, recidivism of the patient, and litigation involving the claim. Using resulting insights, organizations have been able to cut overall claims costs by nearly 20 percent and indemnity-related costs by nearly one-third, when compared to programs that didn’t employ such tactics. In one instance where a third-party administrator (TPA) used analytics, closed claims increased by 50 percent and the average claim amount dropped by 9.1 percent within nine months.

Barriers to implementation are often based on false perceptions, which can be addressed through education and awareness As more innovations are available, it’s important to identify potential barriers to adoption and understand why they exist. For example, in the case of telemedicine, many aging injured workers may have generational preferences to see treating physicians in-person. Or, patients may not want to deal with a complicated piece of technology. If remote monitoring is offered, they may feel as if “big brother” is watching.

Other prospective users feel performance anxiety, wondering if they will be called on to master advanced capabilities beyond their skillset. They may worry that they can’t find and download the right app, or that the app won’t work on their smart phone or other device. To avoid such perceived hassles, some employers offer capabilities, such as telehealth, from their worksites, so employees can use work devices, pre-configured with the right tools.

For other potential users, technology is perceived to create a wedge between the physician and patient. For instance, in telehealth, physicians are unable to directly observe their patients. They may miss non-verbal cues. Many believe these factors are vital and lost in virtual interactions. Many physicians may feel they lose an opportunity to build bond and ongoing rapport with patients.

These factors can affect adoption, but with time and individuals beginning to share their positive experiences, adoption will increase.

Embracing Innovation
As technological and medical advancements continue to emerge at a rapid pace, we’re likely to see ongoing developments in how we deliver and manage care. As breakthroughs are introduced, we need a systematic approach to pilot new programs in a way that limits risk and optimizes benefits.

While deploying the new developments, we still need to ensure the basics of quality care, by using physicians who have consistently demonstrated good outcomes. We must continue to comply with federal and state regulations in regard to services covered, provider requirements, reimbursement and medical licensure. There are also cultural issues to consider and address, such as generational preferences and perceptions.

Through it all, analytics is a core tool that can help ensure we’re reaping value from our newly deployed capabilities.

About Linda Lane
Linda Lane is President of Harbor Health Systems, a company that is revolutionizing workers’ compensation by identifying the best performing physicians for better outcomes at lower overall costs. Linda also leads strategic initiatives with customers, improving both access to care and overall medical outcomes. Her career in workers’ compensation spans more than 20 years of innovation, helping move the industry from a focus on cost containment and transactions to one which brings true medical management. Linda is also one of the founders of a leadership training program for women, founder and chair of the Business Insurance Women to Watch Foundation, and a graduate of Radford University. She can be reached at

About Harbor Health Systems
Harbor Health Systems, a One Call company based in Newport Beach, Calif., leads a revolution in medical networks that allows customers to build and manage a medical system based on quality performance of providers rather than the “lowest bidder medicine” that is typical of PPOs and HMOs. Harbor Health builds and manages outcomes-based medical networks, and supplies the tools, software and services to help their customers build, implement and optimize custom networks. With Harbor Health Systems, companies can identify physicians and other medical professionals who have exceptional skills in clinical, patient care and business management. By working with these healthcare professionals, payers and self-insured employers can greatly reduce the cost of care, complications, and time away from work. For more information, visit

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