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Christopher Tidball has a good piece at propertycasualty360.com on strategies to curb the rising cost of bodily injury claims. As Tidball notes, bodily injury claims continue to rise at rates faster than inflation. He focuses on taking proactive steps on the front end of claims to ensure that a complete investigation is performed so that damages do not get out of hand without the claims professional’s awareness. A few suggestions are particularly useful as these investigation techniques sometimes fall under the radar:
Perhaps the most useful suggestion is to pay exceptionally close attention to the actual medical bills. Specifically, Tidball notes that coding is frequently used to increase reimbursement. In a telling example of how coding can be manipulated to drive up costs,
Consider a basic lumber MRI with and without contrast. A provider may bill 72148 and 72149, which would be appropriate for these as individual diagnostic tests. However, when they are conducted together, the appropriate code should be 72158, which is the bundled code [and will result in a lower overall bill]. (Parenthetical and emphasis added).
In addition, Tidball reports that using fee schedules or benchmarks to evaluation medical bills will help to contain costs and keep bodily injury expenses reasonable and under control.
The article is short, but provides some useful strategies for controlling costs in bodily injury claims. As is the case with most claims management, the key is to get in front of the claim from the beginning. Conducting thorough background checks on all parties involved and carefully examining billing codes and reimbursement rates are some strategies that will help claims professionals get in front and stay in front.
A recent development finds an alternative to postoperative pain management in knee replacement surgery that appears to offer more effective pain relief and potentially speedier recovery. Researchers found that when they injected “a newer long-acting numbing medicine called liposomal bupivacaine into the tissue surrounding the knee during surgery…[p]atients had pain relief for up to two days after surgery and better knee function compared with the traditional method." One of the study’s authors noted that “many patients were able to walk comfortably within hours after surgery.”
It is estimated that more than half of American adults diagnosed with knee arthritis will have a knee replacement at some point. Given the prevalence of knee replacement surgery both in the general patient and worker’s compensation patient populations, any development that can improve pain relief and increase early knee function could have a profound impact. Prescription pain reliever abuse continues to vex society and intraoperative techniques that can reduce the need for postoperative narcotic pain relief can only help the problem. In addition, faster restoration of knee function has the potential to speed rehabilitation and end of healing. If this new technique fulfills its early promise, it could have a significant and positive effect on reducing costs and recovery time of knee replacements. In the worker’s compensation setting, this would be a welcome development.
Andreas Goebel, a lecturer in molecular and clinical pharmacology at the University of Liverpool, has an article at The Conversation about an exciting development in the understanding of how chronic pain works, which offers possible insight into treating Complex Regional Pain Syndrome (“CRPS”), among other chronic pain conditions. Historically, CRPS has been considered primarily a brain problem. The article points out that recent research suggests autoantibodies are implicated in CRPS by “binding to peripheral tissues, prompting sensory nerves to misfire.” The working theory is that trauma, even minor trauma, induces inflammation which causes the binding/misfiring sequence and this in turn causes the central nervous system to become “wound up.” Once the central nervous system is wound up, it malfunctions, causing the unusual and often intractable symptoms of CRPS. As Goebel reports, the discovery of autoantibodies’ role in pain development is important because “there are treatment methods … designed to reduce or remove antibodies,” which may well prove effective in treating CRPS, especially if treatment is initiated early in the progression of the disease. These findings could prove important as claims involving CRPS typically have high disability and medical expenses and are difficult to process and close in a timely manner. Any effective treatment options would have the potential to change CRPS claims processing radically for the better.
Cognitive psychology and behavioral economics have taught us that our unconscious biases matter. In numerous preceding posts, I have discussed the problems that these biases can cause in our decision-making process and have offered strategies to overcome many of those biases. One common factor in the discussion of biases has been the incredible strength and persistence of our beliefs, especially those that our unconscious biases shape. Previously I have discussed our biases and beliefs as negative cognitive tendencies to be overcome. Fortunately, our beliefs have a positive aspect as well.
One area in which our beliefs have a positive effect on our cognition involves how we think about willpower. Despite what can seem like a deluge of research arguing that we have less control over ourselves and our environment than we think, there is a significant body of research developing that demonstrates that our beliefs about willpower, regardless of the factual accuracy of the belief, can impact our ability to perform on cognitively demanding tasks that happen over time, such as learning new things. In short, the research demonstrates that if we believe that willpower is important, we perform better on tasks requiring us mentally focus over an extended period of time.
For example, Miller et al. conducted a study of students who were given a tasks requiring sustained engagement with “a strenuous mental task that taxes working memory.” One group was primed to believe that willpower was limited and easily depleted while the other was primed to believe that willpower was unlimited and not easily depleted. The authors found that students who were primed to believe that willpower was unlimited “increased in accuracy” of the second half of the test while students primed to believe that willpower was limited and easily depleted did not improve their performance over the second half of the test. As a result, the authors concluded that, “only participants in the non-limited willpower condition sustained learning for the entire duration of the task.” As they note, “this experiment suggests that people’s beliefs about the nature of willpower can also limit or facilitate the acquisition of a cognitive skill.”
These findings demonstrate that our beliefs can make a positive difference on performance. While I am personally given to skepticism, I recognize that how we approach problems is different than how we judge the information we receive. In the case of approaching tasks or problems at work that require sustained attention such as learning or problem-solving, it is important that we tell ourselves that willpower matters, that sustained engagement is energizing, and that difficult problems strengthen our focus. In short, we should be optimists when we need to get the job done.
Too often we associate health and well-being with physical, or bodily, health, forgetting that we are creatures of mind. In many ways our mental health and well-being are more important than our physical health. Not long ago we reported on research demonstrating that well-being was more important in predicting workplace absence than physical health. Now Employers Health, an Ohio-based employer coalition,has data demonstrating just how significant mental health and well-being is to the workplace: 2 in 5 U.S. worker’s report missing work due to depression. Each episode costs employers an average of 10 workdays due to depression. Medical researchers estimate that depression costs employers $100 billion annually, including $44 billion in lost productivity. This really is a staggering figure when one considers that the total costs to employers related to musculoskeletal disease has been estimated to be approximately $130 billion.
Of course the million, or in this case, billion dollar question is what, if anything, can employers do to lower the costs of employee depression? Most importantly, research “suggests every one dollar invested by employers in enhanced depression care yields approximately three dollars for the company in the form of productivity gains by employees.” Hence, employers will likely reap economic benefit from ensuring that employees have access to adequate mental health care and support. In addition, mental health diagnoses, including depression, continue to carry a stigma that makes it harder for many employees to admit when they are having a problem and to seek appropriate treatment, which in turn affects performance negatively and leads to workplace absences. Employers can, and many do, have proactive programs to ensure that employees are aware of the confidential support services available to them and that employees understand that there is no stigma attached to using such support services. Continuing to promote the psychological health of employees and to publicize the programs available to help employees maintain their psychological well-being can go a long way to reducing the stigma of mental health issues and reduce the associated costs for employers.
Yet another reason to quit smoking: smokers are three times more likely to suffer chronic back pain than non-smokers (subscription required), according to Northwestern University Feinberg Medical School researchers. Interestingly, the researchers found the link between smoking and increased back pain is in the brain and not the back. The lead author of the study noted that smoking “affects the way the brain responds to back pain and seems to make individuals less resilient to an episode of pain.” Researchers found that two areas of the brain are critical in to developing chronic pain (nucleus accumbens and medial prefrontal cortex, NAc-mPFC). As researchers reported, “That circuit was very strong and active in the brains of smokers … but we saw a dramatic drop in this circuit's activity in smokers who … quit smoking during the study, so when they stopped smoking, their vulnerably to chronic pain also decreased.”
Smoking is frequently a vexing component of claims involving back problems. We know smoking can predispose persons to back problems and significantly reduces the likelihood that back surgery will succeed. This study demonstrates that smoking also changes the way the brain behaves, which appears to make the physical problems worse. Claim handlers and medical professionals should exercise whatever power they have to convince persons with back problems or injuries to quit smoking immediately. While smoking is a personal choice, worker’s compensation premiums should not underwrite the costs of that choice when, for example, a minor back strain becomes chronic, intractable, and expensive to treat because of a person's decision to smoke.
Chronic and terminal pain cause myriad personal, interpersonal, and socioeconomic problems. In what can only be described as sadly ironic, the most effective pain relievers currently available, all of which are opioids, have side effects that can cause problems that are as bad as the pain the drugs are administered to control. The most troublesome and well-known side effects include altered mentation/sedation, physical dependence, respiratory depression, constipation, and androgen deficiency. For example, cancer pain can be managed effectively with powerful opioids, but at the expense of rendering the person suffering from the pain nearly comatose. In non-terminal, chronic pain patients, physical dependency can lead to job loss and ultimately death by respiratory failure from overdose.
Our current ability to manage chronic and terminal pain puts many sufferers in a catch 22: treat the pain but get the side effects, avoid the side effects but live with the pain. The ideal solution to the chronic and terminal pain conundrum would be to develop or discover methods to control pain that are as effective as opioids but without the systemic side effects. In short, new pain relief treatments should only target that which is generating the pain. Fortunately, a group from Flinders Medical Centre in South Australia is doing just that. Medical News Today reports that lead researcher, Associate Professor Nick Spencer, and his team have developed a technique to identify precisely which nerve endings detect painful stimuli. They then developed a method to inject a harmless virus into the site from which the pain originates that travels to the spinal cord and shuts off a channel to the affected nerve endings that is essential for pain perception. As Spencer noted, “shutting off the pain is not instant, it can take days to weeks, but the big advantage is that pain can be suppressed for long periods without the classic side effects of current pain therapies.”
The team’s current research focused on incurable pain located in the stomach and intestines, but Spencer believes the technique will have broader applications. This would be exciting news for everyone and would be especially welcome in the claim handling community as chronic pain cases are often vexing, expensive, and resource intensive. Any development that could eliminate or at least reduce the use of opioid pain medications in the chronic pain context would have a significant and positive effect on the management of claims involving chronic pain.
Choice architecture is the idea that the way in which choices are framed influences the actual choices that are made. The idea arose out of findings in psychology of persistent and pervasive cognitive biases and decision-making heuristics. The thought behind choice architecture was something like this: if we know how biases affect decision-making, then we should be able to structure choices to “nudge” or push people toward the choices we want them to make by taking advantage of people’s cognitive biases.
Cognitive psychology has given us numerous examples of the way in which framing choices influences what choices are actually made. An interesting example involves default options and organ donation. In countries where the default option is to donate and persons must affirmatively check off a box to show one does not want to donate, the vast majority of persons opt for the default (85-99%). To the contrary, in countries where the default option is to not donate and one must affirmatively check a box to show one wants to donate, the vast majority of people opt for the default (80-95%). The conclusion from this finding is that we can take advantage of the status quo bias (the default option) to achieve a result we want.
Some of the findings regarding cognitive biases are relevant to claims administration. For example, the anchoring bias is the common human tendency to give too much weight to the first piece of information one receives when making subsequent decisions. In the claims setting, this bias could suggest when to make a settlement offer and how much that offer should be. I know many people express frustration at the negotiation process (and I was one such person) and think, shouldn’t we just offer what the claim is worth and be done with it? Unfortunately, the answer is probably “no.” While it may seem easier to price a settlement like it was a piece of merchandise on the shelf at Target, the effect of doing so would likely be deleterious. Even if the offer is fair, it will likely have the effect of convincing the other side that they can get a higher or better settlement because they will judge the settlement value in part based on the first offer they receive which by habit they will consider to be your floor. To take advantage of the anchoring bias, initial offers to settle claims should be sufficiently low so that the other side’s calculation of settlement value is influenced downward. Although this results in the typical tit-for-tat negotiations, it is probably the best way to handle an initial settlement offer given what we know about the anchoring bias.
Another cognitive bias that could potentially be used to one’s advantage in settlement negotiations is the endowment effect. This bias is the tendency of people to value giving something up more than they value acquiring the same thing. The clearest example in cognitive psychology involved basketball ticket prices. When Duke University students were told they won tickets to the NCAA basketball tournament Final Four they valued them considerably higher than students who were told that they had to buy the tickets. In that experiment, students who won the basketball tickets said they would sell the tickets at an average price of $2,400. Students who were told they would have to buy the same tickets said they would buy the tickets for an average of $170. Obviously this is an extreme example, but other research consistently finds that persons value a thing they own 2.5 times higher than the identical thing that they have to purchase.
In the settlement context one might be able to influence outcomes by framing the discussion not as something being given up but rather as something being gained. When claims are settled, employees (for example) tend to think that “I have a claim worth X dollars” so that any settlement is a reduction in the value of “their” claim. Perhaps the discussion could be reframed to suggest that the employee has a claim worth zero dollars because of an IME or a factual defense. In this way, the claimant is not giving anything up but is rather acquiring something, which could potentially lower the value at which they accept a settlement. Obviously represented claimants have an attorney to get through, but still this has the potential to be an effective negotiating strategy. Certainly it is something that one could use at mediation to tell the mediator how one would like any settlement offers to be presented.
So is choice architecture real? It appears to be a legitimate method to influence decision-making under the right circumstances. While nothing can guarantee that using choice architecture will lead to better results, it is a tool that claims professionals can use in situations where cognitive biases are present to try to shape the decision-making process. Choice architecture will generally have little or no cost and potentially has significant benefits. Hence, it is a strategy worth considering the next time you are trying to settle a claim.
Medical News Today reports on an interesting development in treatment of noise-induced hearing loss. Researchers from the University of Michigan and Harvard Medical School used gene therapy to reverse partial hearing loss in mice. The mice’s genes were manipulated to increase production of a protein (NT3) necessary to keep the connection between the ear’s hair cells and the nerve cells that communicate with the brain “super-fast,” also called a “ribbon synapse.” Exposure to noise and normal aging can damage the ribbon synapse, leading to hearing loss. By increasing production of the protein NT3, researchers were able to repair damage to ribbon synapses and restore hearing.
This is exciting news for anyone handling worker’s compensation claims because hearing loss claims plague myriad employers. Researchers noted that rather than pursuing gene therapy in human subjects, the most likely way to increase production of NT3 in humans would be through the use of drugs, a number of which researchers have already identified as candidates. From a worker’s compensation perspective, the possibility of reversing hearing loss would represent a substantial development in what has previously been a permanent condition manageable only through the use of hearing aids. However, the use of pharmaceuticals to treat hearing loss would have costs. How substantial those would be is impossible to guess. Regardless, it is worth monitoring the research to see if the same finding can be reproduced in human subjects.
The Wisconsin Safety Council has an excellent piece on men's mental wellness. As the article points out, although suicide is the leading cause of death among men between the ages of 25 and 34, men's mental health is too infrequently discussed because of the stigma we attach to it. The focus of the piece is on mantherapy.org, a site devoted to helping men confront mental health issues and concerns using humor and a "man-centered" approach. Wellness is too often associated with physical health. The article and mantherapy.org remind us that being well requires both mental and physical wellness.