Category: Uncategorized

Feb
24

The Ukrainian War’s impact

Posted by Joe Paduda on Thursday, February 24th, 2022 | Comments

Equity markets are getting hammered, the bond market is up substantially, and energy prices and assets are zooming.

Those are the immediate effects of Russia’s invasion of Ukraine.

What will happen now is anyone’s guess, but here’s how I see it.

  • Putin is all in.  Attacks are hitting cities hundreds of miles from the Donbass and eastern Ukraine, signifying Putin’s intent to take over the entire country.
  • The western countries – Europe and North America, as well as some Asian nations will rally around severe penalties for Russia – blocking access to the SWIFT system, banning trade in Russian debt and equities, and instituting a broad ban on exports to Russia.
  • This isn’t going to end anytime soon.
  • Ukraine will be very hard-pressed to hold off Russian forces; the Ukrainian military is much smaller, has fewer armored vehicles and airplanes, and isn’t positioned well to fend off attacks from the north and southwest.
  • China is a bit of a wild card; it
    • consumes a lot of Russian foodstuffs, gas and oil,
    • sees Russian aggression as a not-very-big-deal,
    • likes the strategic problems the invasion creates for the West (China could move aggressively on Taiwan), but
    • knows Russia’s financial situation is going to deteriorate quickly,
    • has tens of billions invested in Russia, and
    • understands that Putin is playing with a fairly weak hand.

So, I’d expect:

On the scarier side, expect Russia to launch cyber attacks in retaliation for Western sanctions, attacks that will very likely target financial institutions, infrastructure and commercial entities.

What does this mean for you?

Uncertainty breeds stasis…until we see where this is headed, expect interest rates to rise which will increase the cost of debt and reduce private equity investment.

Feb
10

Wait…what??

Posted by Joe Paduda on Thursday, February 10th, 2022 | Comments

Science denial – or perhaps a total absence of common sense – is nothing new – if anything it has gotten more pervasive of late.

Here are a few examples of willful ignorance guaranteed to make you smack your head (I hope…)

This from Scott Galloway…

I

Here’s the map they use…

Belief in Evolution

Belief in creationism

This is NOT a Right vs left, Liberal or Conservative issue.

an almost-comprehensive view of the many, many examples of nonsense…

What does this mean for you?

Dec
17

Friday update

Posted by Joe Paduda on Friday, December 17th, 2021 | Comments

Apologies for lack of posts this week; this was the annual father-son hunting trip, and work is strictly banned.

Here’s what happened this week…

News hit the wire that Enlyte (aka Mitchell Genex Coventry) is for sale. Owner Stone Point Capital (deep experience in workers’ comp) is reportedly “exploring a sale” of the company which is generating about $450 million in earnings (I’d be a bit careful about that figure as sellers almost always include stuff in “earnings” that doesn’t usually “count” as such.)

There aren’t too many potential buyers for a deal this big as we’re talking a “multi-billion dollar” deal.

HomeCareConnect was bought by Paradigm – more on this later, but my initial take is this is a smart move by the big cat case management company as it brings a well-regarded DME and home health provider into the fold, allowing Paradigm to capture all that revenue and margin on their financials.

Research –

The fine folk at WCRI have just released a very helpful report on the use and reimbursement of telemedicine in work comp.  The report is free to members; non-members get their copy for a nominal fee.

From WCRI; the report addresses:

evaluation and management and physical medicine services. It investigates the patterns of telemedicine utilization among these services in workers’ compensation during the early months of the pandemic (primarily March–June 2020) across 28 states. It also examines the actual prices paid for the most frequent services delivered via telemedicine versus in person across the study states.

NCCI researchers collaborating with various other agencies published a summary report on the impact of COVID on workers comp. Download a copy at the link…

Key takeaways include:

  • Covid claims are cheap – as in a LOT less costly than non-COVID claims
  • There’s a “new” claim category – “Indemnity only” that accounted for a plurality of claims.

Interestingly,  more and more insurers have stopped waiving member payments for COVID treatment.

Oh, and costs varied a LOT across states – $49k for non-complex hospitalizations in Maryland vs $129k in New Jersey. That’s likely largely due to Maryland’s very smart hospital charge regulation policies.

from FairHealth

The median length of complex hospitalization declined from a peak of 13 days in April 2020 to 7 days in July of this year…which is likely a big contributor to lower treatment costs.

What does this mean for you?

The investment community’s fascination with workers’ comp will be put to the test.

If you get COVID, you’re gonna pay a lot for your care – if you go into the hospital. 

Nov
22

I’m thankful for

Posted by Joe Paduda on Monday, November 22nd, 2021 | Comments

The many, many good friends I’ve made over 30+ years in this business…people I would not have met if I hadn’t somehow stumbled into and stayed/got stuck here.

The passion many have to do the right thing and the privilege it has been and is to work with companies and organizations with that central objective.

Readers who challenge, confront, correct, applaud, cheer, and debate and have been doing so for 17 (!) years.

The mistakes I’ve made over the last few decades, for what they have taught me about hubris, assumptions, lack of diligence, and the power of experience.

My family – Deb, the most positive, joyful person on the planet who’s somehow tolerated me for 34 years; Erin who’s become an amazing mom, fierce advocate for her patients, and incredibly strong person; Molly whose intensity in competition is matched only by her love for and dedication to family; and Cal who has persevered in the face of overwhelming difficulties, always pushing through and never giving in.

A lot about our world is less than great these days, so it’s more important than ever to keep the good front and center.

Be well.

 

 

Nov
17

Infrastructure = jobs = premiums and claims

Posted by Joe Paduda on Wednesday, November 17th, 2021 | Comments

Three days ago President Biden signed the Infrastructure Investment and Jobs Act, a notable accomplishment coming after bipartisan support in Congress.  Pretty remarkable that this happened at all; past Administrations  – both Democratic and Republican that enjoyed majorities in Congress were unable to pass this desperately needed legislation.

There’s lots of good news in the Act; including: (source Business Facilities)

  • US$47 billion in climate resilience measures to protect buildings from the storms and fires that result from climate change
  • $65 billion to repair and protect the electric grid, build new transmission lines for renewable power and develop nuclear energy and “green hydrogen” and carbon capture technologies
  • $39 billion to continue and expand current public transit programs, including help that allows cities and states to buy zero- or low-emission buses
  • $66 billion to fix Amtrak and build out its service along the Northwest Corridor, in addition to building tens of millions for high-speed rail and other commuter rail
  • $7.5 billion to build electric vehicle charging stations;
  • $25 billion to repair airports to reduce congestion and emissions, encouraging the use of low-carbon flight technology

States are already targeting the funds for much-needed projects; North Carolina is getting $1.5 billion for bridge repairs,  broadband expansion, and transportation upgrades – and more dollars for other projects.

Wyoming’s roads, dams, water systems and bridges will get $2.5 billion in repairs and upgrades.

Arizona’s rapidly expanding population desperately needs new infrastructure – and big improvements to utilities especially water as well as ports of entry along the border. 

The federal Transportation Department “plans to open competition for the first round of port infrastructure grants funded by the bill within 90 days, as part of a broader effort to ease supply chain bottlenecks slowing down the delivery of goods.”

That will impact Long Beach, Savannah, Houston, Los Angeles, Miami, Mobile, Seattle, Norfolk and other critical ports.

The question is – how fast will these dollars translate into employment? I’d say next summer we will see a noticeable impact as plans that are already under development get funding commitments.

The Federal Highway Administration projects each billion dollars in highway funding supports 13,000 jobs.

S&P estimated a:

 $2.1 trillion boost of public infrastructure spending over a 10-year period, to the levels (relative to GDP) of the mid-20th century, could add as much as $5.7 trillion to the U.S. over the next decade, creating 2.3 million jobs by 2024 as the work is being completed.

The Act is about $1.7 trillion in spending, so we’re looking at about 1.9 million jobs. 

Of course, that is an estimate – it could be higher or lower. However, there’s no question workers’ comp will see:

  • higher premiums;
  • more claims; and
  • higher severity.

What does this mean for you?

Prepare for some much-needed growth. 

Aug
10

Opioids, tapering, and risks – what you need to know

Posted by Joe Paduda on Tuesday, August 10th, 2021 | Comments

WorkCompCentral’s Mark Powell penned an excellent piece on just-released research on tapering long-term opioid patients.

One finding demands our attention; researchers found a statistically significant increase in overdoses and mental health crises in the 12 months after tapering was concluded. On average, these adverse events (science talk for bad stuff) happened 6 months after tapering concluded.

From the JAMA article:

In the current study, tapering was associated with absolute differences in rates of overdose or mental health crisis events of approximately 3 to 4 events per 100 person-years compared with nontapering. These findings suggest that adverse events associated with tapering may be relatively common and support HHS recommendations for more gradual dose reductions when feasible and careful monitoring for withdrawal, substance use, and psychological distress. (emphasis added)

The study included 114,000 patients who had been on stable, higher doses (50+ morphine equivalents) of opioids over an 11-year period. It came on the heels of two chronic pain studies published earlier this year; one addressed opioid treatment for chronic pain and the other was a meta-analysis of 190 studies focused on non-opioid treatment. I wrote about both here.

Tapering is an opioid management approach involving a steady decrease in opioid dosage over a prescribed time. The decreases in dosage and how fast patients were tapered varied significantly among the patient population; patients who were on higher doses before tapering were at increased risk for adverse events.

There were some limitations in the study including; the population was Medicare Advantage and commercially insured; individual patient tapering may have varied after the initial decrease; and the data didn’t indicate if the prescriber or patient initiated the tapering.

A thoughtful and detailed discussion of tapering is here…in part the paper states:

The authors emphasize that any medical action taken should involve as much patient buy-in as possible and should not be driven by rigid opioid dose cutoff s and misinterpreted guidelines. The authors of this paper also support sustaining patients on their existing medication at its existing level if patients are continuing to benefit from use, are not experiencing significant side effects, and express the desire to remain on their current medication as opposed to pursuing a taper. In such cases, the risks of a taper would outweigh the potential benefits.

Regardless, this is a wake-up call to the industry. Yes, workers’ comp – once the addiction creation industry – has made great progress in reducing inappropriate opioid usage and some progress in helping long-term opioid patients reduce or eliminate opioids.

That said, there are a variety of opioid management approaches, and we should be considering – and open to – any and all.  Medication-assisted therapy involving methadone or buprenorphine, physical therapy, acupuncture, yoga, and talk therapy are among the approaches that have shown promise.

I’ll end quoting myself from a post back in 2019;

we need to make very sure we are doing the right thing for patients. In some instances this will involve telling patients what they don’t want to hear; we need to be prepared to do that and help them thru the process, while understanding that process is very difficult.

Apr
15

Why are you using that metric?

Posted by Joe Paduda on Thursday, April 15th, 2021 | Comments

I’ve had several conversations with claims and managed care folks over the last few months about measuring performance, outcome metrics vs process metrics, and the challenges of data collection, aggregation and analysis.

Two takeaways.

Too often the discussion has been too focused on process, too down-in-the-weeds, too concerned about how and what to measure. While process and detail are important, they are secondary to the “why” question.

The most important question is “Why?”

Why are you doing this? Why are you using that metric? Why do you think that is the right metric?

Sometimes I’m a (very) slow learner, but I’ve finally figured out that it is far better to ask those questions than to tell the person what they should be doing. Telling someone something eliminates the chance for them to think through what they have done, why they’ve done that, and if it that was the best thing they could have done.

It forces them to take a step back and question themselves, their assumptions, their pre-conceived notions.

It’s easier – and more ego-gratifying – to tell someone what they should do. I’ve found that this can shift the discussion into a far less productive direction, one where the client may well disagree, to defend what they are currently doing. After all,  to hear someone say what you have been doing for X years is “wrong” will make anyone bristle a bit.

Second, metrics are almost never directly aligned with the organization’s overall goals.

For example, the goal of medical management is to improve the combined ratio.  Has anyone in your organization verbalized that…ever?

If they have, then you:

  • wouldn’t give a rat’s rear end about “savings” or “discounts”;
  • would focus on overall spend;
  • would evaluate providers not on how much of a “discount” they give but on what their services cost and how that compares to other providers;
  • would evaluate networks not on how big their directory is and how deep their discounts are, but on the quality of their providers and the cost of their services.

And that’s just the beginning.

Once you establish the “why” the “what” is pretty straightforward – with one big caveat – every time you settle on what you will measure, go back and see if it aligns with your “why”.

Don’t be surprised if it takes a bit to re-orient thinking. Be patient – with yourself and others. It took me 30+ years, so hopefully you’re a much faster learner.

What does this mean for you?

Asking the right questions requires one to invest time and thought. If you don’t have time to do it right on the front end, you’ll never have time to fix it.

Apr
1

Health Strategy Associates has been purchased.

Posted by Joe Paduda on Thursday, April 1st, 2021 | Comments

When you get an offer you can’t refuse…you don’t.

A couple months ago I was approached by an investment firm looking to build a niche practice focused on non-group health medical management. Long story short, for some undoubtedly very good reasons they decided HSA was the right fit.

I never thought a highly specialized, boutique consultancy with one “employee” would have any value beyond what we bring to clients, but clearly I didn’t think hard enough.  Sure, the footprint is solid. Yes, we can bring some very skilled, smart, and experienced experts to any engagement. And we certainly have a brand. Most of the time that’s a good thing, but sometimes it most definitely isn’t.

This isn’t a firm you’ve likely heard of; it’s not even domiciled here. For that reason, we’ll keep the HSA name.  Expect there to be additional resources and expertise, a broader array of skills and knowledge “on offer.” [I have to get used to the non-American English terms, so that’s a start]. There may be a bit less snarkiness from your faithful author too – but that’s attributable more to age sanding off some of the rougher edges than any edict from on high.

Speaking of which, we talked long and deep about whether and how we could work together, and ended up deciding we could. Despite my pathologic aversion to others attempting to tell me what to do, that shouldn’t be [pause for deep breath] an issue. There’s mutual respect and an understanding that when friction does arise we’ll work through it.

Couple of items of note.

First, expect an announcement from our new owners in the coming days.  We agreed that it would be best if we kept the initial focus on HSA and how this [doesn’t] affect clients.  Shortly we will do a more formal mutual release.

Second, yes there will be changes – good ones. HSA will remain focused on niche areas and serve the same client base (payers, service providers, and related businesses). I will continue to speak out on issues, commend those I respect and admire and condemn misguided and wrong actions and results.

Expect more use of technology to aid communications with blog subscribers, more polished presentations and reports, and expand into other channels.

I’d suspect we’ll get into other communications channels – perhaps podcasting, maybe even some video stuff. There are any number of things I’ve wanted to do but just don’t have the bandwidth or expertise or diligence to actually get done.

Finally, I cannot thank clients, supporters, and detractors enough. Over the last 25 years you have helped build HSA, made it better, and made me better. Critics have challenged me and in many cases made me re-think long-held beliefs.

What does this mean for you?

Expect the unexpected.

Mar
30

Chronic pain, opioids, and other drugs – the latest research

Posted by Joe Paduda on Tuesday, March 30th, 2021 | Comments

Dr Steve Feinberg pointed me to two studies conducted by the Agency for Healthcare Research and Quality on chronic pain, both systematic reviews [reviews of published studies of a specific topic]. One focused on opioid treatments for chronic pain, the other on non-opioid pharmacologic treatment.

The non-opioid research reviewed 190 studies, of which 185 were RCTs. Researchers concluded:

improvement in pain and function was small with specific anticonvulsants, moderate with specific antidepressants in diabetic peripheral neuropathy/post-herpetic neuralgia and fibromyalgia, and small with nonsteroidal anti-inflammatory drugs (NSAIDs) in osteoarthritis and inflammatory arthritis.

The takeaways include there are some benefits from some drugs, often dependent on the patient’s medical condition.

The opioid treatment for chronic pain study was based on a review of 162 studies; “115 randomized controlled trials (RCTs) [the gold standard of clinical research], 40 observational studies, and 7 studies of predictive accuracy.”

Note that for research purposes, chronic pain is described as pain that lasts more than 3 to 6 months.

There was more credible research available to assess short-term outcomes vs longer-term outcomes; there was no RCT comparing opioids to placebo for medium or longer-term periods.

Takeaways included (and these are direct quotes):

  • There were no differences between opioids and nonopioid medications in pain, function, or other short-term outcomes
  • Opioids were associated with small benefits versus placebo in short-term pain, function, and sleep quality.
  • There was a small dose-dependent effect on pain, and effects were attenuated [reduced] at longer (3 to 6 month) versus shorter (1 to 3 month) followup.

Most concerning, “there is evidence of increased risk of serious harms that appear to be dose dependent” [the higher the dose, the greater the risk].

This crossed my desk the day before a good friend’s brother died of an apparent opioid overdose, adding a painful exclamation mark to the study’s conclusion.

Extensive research in Australia focused on long-term opioid use in patients with chronic non-cancer pain found that:

Despite limited evidence of efficacy, there has been a considerable increase in the long-term prescribing of opioids for chronic non-cancer pain in several countries

Here’s the thing; the research we do have clearly demonstrates the risk of opioids is high, and the benefits are limited. However, there isn’t near enough research on the efficacy of long-term usage of opioids for chronic pain.

Anecdotal evidence indicates some patients can do well on opioids for extended periods.

That said, the evidence we do have suggests that overall, efficacy may be limited at best, and the risks are high. Fortunately more research on opioid efficacy and risks and chronic pain has already been funded.

What we cannot do is force patients off opioids; this is dangerous and unethical.

What does this mean for you?

Opioids have their place – but be very careful, especially when use is long-term. Life is precious. 

 

Mar
26

Friday catch-up

Posted by Joe Paduda on Friday, March 26th, 2021 | Comments

Swamped with WCRI’s annual confab (more posts to come on that event) and client work. And the ubiquitous Zoom/Teams/Webex meetings…my high is 6 in one day.

Hoping that’s more than you – for your sake.

Okay, here’s a few items of note.

WCRI’s sessions are recorded and available to registrants here. There’s a ton of great info on fee schedules, the impact of state regs on opioid usage, projections on the future of employment, and treatment for COVID.

Risk transfer

Tuesday I’m co-hosting with Carisk Partners’ CEO Joe Berardo a webinar on Risk Transfer Strategies. We will dive into the key to successful risk transfer programs – behavioral health. Usually it’s not the medical that’s the real issue – it takes a unique approach to get to the real drivers.

If you’re a claims exec, claims or risk manager, or medical director please join us; take a brief survey here before hand so we can be sure to cover the issues you’re most concerned with.

Vaccine effectiveness

Very good news indeed out this week – Medscape reported:

Testing (in California) showed new cases among 2.5% of those tested within the first week after the first dose, 1.2% during the second week, 0.7% in the third week, 0.4% during the week after the second dose was given and less than 0.2% in the second week after the second dose.

In North Texas, where workers were also vaccinated in the midst of the largest COVID-19 surge the region had seen, 2.61% of unvaccinated employees developed the infection versus 1.82% of partially-vaccinated workers and 0.05% of fully-vaccinated employees.

Put another way, you’re fifty times more likely to get COVID if you aren’t vaccinated than if you’re fully vaccinated.

I’ve got my first – hope you have both.

If you’re not at the table, you’re on it.

Great piece in Harvard Business Review on the impact of the pandemic on health system consolidation. This is going to be a major driver of facility costs for workers’ comp. Key excerpt:

Studies to date tend to rebut the argument that acquisitions improve efficiencies, reduce costs, and lead to better care coordination. Instead, they show that consolidation increases prices and fails to improve the quality of care. For example, hospitals’ acquisitions of physicians’ practices in California has been linked to higher prices for primary care and specialist services and to increases in insurance premiums.

Back to work next week – enjoy the last weekend in March.