Joe Paduda Speaks at Conference


“How do I suck as money dollars as possible out of work comp pockets and into mine.”

That was our Conference industry keynoter Joe Paduda of Managed Care Matters bringing a glaring light to the mentality of the “bad guys” in workers’ compensation. He highlighted how that attitude escalates the cost of workers’ compensation and ultimately damages us all. Some statistics from his address:

We have a combined loss ratio of 117 percent, highest in a decade.

Physician dispensing of repackaged drugs accounted for $1 billion in unnecessary costs in 2011. Without physician dispensing, workers’ compensation would have been profitable last year. Illinois is the new Florida. Physician dispensing there is now as high as in Florida.

A lot of opioid prescribers are trying to do that right thing. But we need to think not only about what we should be doing in the future, but what we must do about the current cases we have. They have a very long tail.

California is at 16 percent of medical spend on managed care fees. Double payments for surgical implants because of some weird loophole in California adds another $70 million.

Oxycontin and other opioids: Folks, we own the addiction. And the addiction owns us. Chartis said the preponderance of opioids played a role in its decision to get out of the excess work comp business.

Currently there are 51 million non-elderly Americans without health insurance. What has been the impact of that? Cost-shifting to workers’ comp. Workers’ comp accounts for about 1-2 percent of all hospital admissions, but about 17 percent of all hospital profits.

In closing, some good news: I think the decade moving forward in workers' compensation is going to be much better than the decade we just passed.

(See past Work Comp Nation blogs here.)

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Joe continues to be at the forefront of the issues most affecting Workers Comp.  The significant challenges with physician compounding and re-packaging are not common place in any other health care delivery system.  The opioid addiction and dependence issue may be the biggest cost driver and policy issue facing Workers Comp today with no real strategy to address and antiquated statutory barriers creating both real and imagined obstacles.

2012 08 21

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