Are Your Vendors Superheroes?
For those of you who know me, by now you know I look at things differently. While I was not sure if my outlook on things would fit well with the Next Level Administrators approach to workers’ compensation claims handling, I soon learned that my viewpoint and my belief that an advocacy approach really does disrupt the status quo as to how vendors are managed and what is expected from them.
A vendor panel consisting of one vendor for each type of service has limitations because the risk of complacency increases. If all the business in a vendor class is directed to one vendor (large or small), it impacts service quality and over utilization of services. Creating a competitive forum and accountability standards for each vendor class can reduce complacency and create a team of super hero vendors. When a vendor is hungry for your business, they will make every effort to ensure their entire team is providing quality service, not over utilizing services, and meeting your expectations.
Good Vendors Make Good Partners
Determining whether a vendor is a good match can be difficult for any organization. Performing a due diligence of each vendor is time consuming but imperative especially if a third party administrator (TPA) fosters a culture of accountability to its clients. Knowing if a vendor can deliver the services needed and whether the vendor can provide those services cost effectively is critical to reducing the bottom line for the employer.
Answers to key questions, and those questions can be different within the vendor category, help analyze the vendor’s potential to be a good partner for the TPA and its clients. A few examples:
Do your therapy vendors follow established guidelines (MDA or ODG) and do they report to the adjuster why and when the number of visits has been exceeded, then again when the number of weeks have been exceeded? Often this can be accounted for by the comorbidities, multiple injuries, or overuse of services.
Does your imaging vendor age all studies? All studies can only have three (3) findings: acute, subacute or chronic. Too often radiologist will note age indeterminate. This is not logical. Acute, subacute or chronic findings are the only options.
Are there hidden and/or additional charges with your transportation and/or translation vendor? These charges increase the overall costs of the services, more specifically with transportation.
Collaboration and transparency are keys to achieving a great partnership between all parties involved in the claims process and successful claims management. It’s important to partner with like-minded vendors to consistently improve claim performance and take a workers’ compensation program to the next level.
Evaluating Vendor Performance
Quarterly stewardship meetings with vendors to monitor performance is an effective way to determine if they achieve set goals and outcomes. In most stewardship meeting, vendors willing tell you they are saving you dollars. Measuring the right things also impacts your bottom-line. When was the last time a vendor voluntarily provided you with:
The volume of patients to whom they have provided service
Their ability to meet the needs of the patient
How they are facilitating the reduction of overall cost of the claim
How they are expediting closure of the claim
Demonstrating to the insured and/or carrier how the relationship with the vendors are beneficial to the overall reduction in the total medical claim costs as well in the reduction of time the claim remains open should be one of the key objectives of stewardship meetings.
Each party involved with a claim, third party administrator, insured, or carrier, really should expect evidence from their vendors that they are fulfilling their commitment to the client and the claimant. Medical costs are the largest part of the claim and therefore requires interventions to reduce the costs in each area. While a TPA may be responsible to the carrier and the carrier to the insured, each has the responsibility to the final party paying for the claim. When everyone involved in the claim process provides cost effective services, each will impact the claim by reducing the overall medical costs and, when possible, reduce the length of time the claimant is out of work or the claim is opened.
Henry Ford said, “Coming together is a beginning; keeping together is progress; working together is success.” When vendors are brought together who have the same philosophy, commitment and goals, they become super heroes, especially to the injured worker and the employer.