Identification and clarification of a case payer type is quite simple in concept and execution. In fact, the doctor knows the case type in most cases before he ever meets the patient, because it’s administrative in nature, not clinical. However, there are several subtleties, which must be known to both doctors and patients, and openly addressed for best outcomes.
Cash or Indemnity Insurance
In most Chiropractic practices, this payer set is by far the most common. Indemnity insurances are also thought of as traditional health plans, and are the subject of much heated discussion since the roll-out of the Affordable Care Act (or should I say stall out?) The original version of this type of payer was fee for service, with no attempt to regulate fees or utilization. This type of plan originated in the early 1930’s and was a patchwork system. The rise of employer paid plans took off during world war two, due mostly to the imposition of wage and price controls by the federal government. Health insurance was seen as a fringe benefit and not subject to price controls!
Indemnity insurers still derive the vast majority of their premiums from employers, regardless of the ACA. They heavily regulate price, utilization and access, largely a self-appointed gatekeeper.
The portion that insured patients must pay has risen steadily and rapidly in recent years. The deductibles and co-insurance figures were originally meant as a “moral hazard” (an insurance industry term, meaning a inhibition against the consumption of medical services. They have now risen to the point where, for many insureds, the cost of all outpatient services in a given calendar year are essentially paid by the patient through application of (regulated) fees to the deductible and increasing co-payments and co-insurances.
In this sense, cash paying patients and under or poorly insured patients can be considered one and the same from an economic and legal view.
Here are some basic point that apply to these cases:
- The patient takes full responsibility for their present condition. There is no attempt to attribute any problems to any other party.
- The doctor’s job is to identify the diagnosis, clinical case type , propose and deliver the program of care that will most cost effectively deal with the patients clinical situation, as well as manage the underlying condition if any. With chronic or recurrent conditions, it’s common for the patient to adopt a short view, when in fact the condition is a longer term problem that should not be allowed to dominate the patient’s health.
- The patient’s responsibility is to follow the plan, and be compliant to the greatest extent possible.
Worker’s Compensation
This payer type is either a sate fund/agency or private industrial insurance carrier. After a spotty start in the mid 19th century, the US Supreme Court ruled in 1917 that mandatory worker’s compensation laws were not violating employers’ rights. All states enacted laws and legal boards pertaining to this area immediately thereafter. The basic bargain is this:
- An employee is eligible for 100% payment of health care costs and partial wage replacement if necessary if an injury, exposure or disease is deemed to be work related.
- An employer pays part or the entire premium, and is protected against employee litigation (except in a case of willful or gross negligence).
- This is a no-fault system, meaning that these benefits apply, without attempt to assign blame to either of the parties.
The rules of engagement here are as follows:
- The employer’s insurance policy is paying for the employee’s care, without blame assignation.
- There is usually a “ticking clock”, meaning that cases have time based rules for conclusion, examination, reporting and case management. This means that treatment cannot be delayed without a valid clinical reason, and the knowledge and consent of the claims manager is usually necessary as well.
- Most of the short and long term costs usually reside in time loss, AKA wage replacement. This means that return to work is the highest priority of both the employer and the employee. Return to work can be part time or with limited capacity, but return to work in some form is of the utmost importance. Workers who are off work for 6 months or more are unlikely to return to their previous job, and off work for a year of more means the likelihood of returning to any job is unlikely.
- Most claims end when the patient reaches a fixed and stable condition. This means that further treatment is unlikely to change the clinical condition (not the work status). When this status is reached without full resolution of the complaint, an impairment rating is the pathway for mitigation of a permanent problem. Some states use the AMA guidelines to rate this, some use their own internal systems.
Personal Injury Protection or Med-Pay
This payer type is a property and casualty insurer who has provided a rider paying for medical care and limited benefits for assistance for injuries following a motor vehicle accident. This area of practice is complex and varies by state. Typically the policy will pay 100% of all billed services for anyone in the insured’s car up to a dollar maximum per claim. These maximums range from $5000 to $30,000.
Here are some rules of engagement for this type of case:
- A plaintiff in this case is the person who received an injury due to no fault of his or her own. An innocent bystander, in essence. Since this type of case does assign blame to another party, proof of the mechanism of injury and good clinical correlation between the injury and the accident circumstances are of the utmost importance.
- The patient has the duty to mitigate their damages by being 100% compliant and taking the doctor’s program and recommendations seriously.
- There is a ticking clock in this type of case also, but it’s more clinical than administrative. Damaged connective tissue has a response time based on age and other factors .
- Care is rendered until the patient reaches pre-injury status or maximum medical improvement. In the former, there are no measurable residual injuries that will require care in the future. In the latter, there are, and the doctor must rate or estimate those damages. A non-treating doctor can do this if greater objectivity is required.
- The patient must be made to realize that any damage settlement obtained by counsel is for one of two purposes: to pay for future care once the claim is settled, or exchanging money for health. It’s never a cause for Champagne and cigars!
Clear conceptualization and communication of these ideas at the beginning of treatment can go a long way towards good enrollment and good outcomes.