Summer isn’t off to a sunny start for OneCall.

Two good-sized customers are moving their business to other suppliers. Sources indicate concerns over OCCM’s financial situation led to the switch to other vendors for transportation, PT, imaging, DME and home health.

Sources indicate MTI America, VGM HomeLink, MedRisk, HomeCare Connect, and Paradigm are among the winners. (MTI and MedRisk are HSA consulting clients)

Other customers have been in discussions with OneCall about ensuring payments for treating providers are made on a timely basis.

OneCall was carrying just under $2 billion in debt at the end of the first quarter; that has increased due to the refinancing of a big chunk of debt earlier this year. Despite the refi, debt service is eating up most of OneCall’s cash flow, dollars that would otherwise go to internal needs such as Polaris – the company’s name for their new IT platform..

The refi terms allow OneCall to not pay a portion of the interest on the new debt. Instead, the deferred interest becomes part of the debt owed. So, sort of like credit card debt, if you don’t pay the interest owed, you end up owing interest on the unpaid interest.

That saves cash over the near term, but increases the company’s total debt load and the cost of paying off that debt just gets bigger every month.

I’m hearing the customer-facing part of Polaris is gaining fans, but development of connections to and replacement of legacy internal systems isn’t keeping pace. This may be part of any cash-flow problem; Polaris was supposed to reduce headcount by replacing people with systems. If customer-facing staff hasn’t been reduced and customer service levels haven’t gotten better, OneCall has a couple challenges, namely:

• continuing to pay for Polaris development, while
• keeping more people on payroll, in an effort to
• keep customer satisfaction at some reasonable level and
• generate enough cash flow to pay the bills.

I’ve asked OneCall for their comments, but the company has been quite unresponsive of late so don’t expect anything substantive.

Marketing is not sales support.  If proposal writing and RFP responses are in “marketing”, you aren’t doing “marketing”.

Selling is one-to-one. Selling is finding out what that individual’s views, perspectives, challenges, biases, needs, opinions, fears and desires are. It is NOT “selling”, rather it is finding out what problem that person has and what she wants to buy, then packaging your offering so it addresses that individual’s needs and situation.

Marketing is one-to-many. It is doing the research to identify market segments, and those segments’ needs, wants, fears, and buying processes. It is developing and modifying products and services so they specifically address general and specific needs. It is promoting those products and services so potential buyers are aware of them and see the applicability to their situation.

Marketing can be squishy; it can be hard to assess the ROI on a marketing campaign or investment.

Work comp services execs often think marketing is easy, simple, and they are good at it. Hey, they can write an article, press release or “white paper” or give a speech or design a booth.

While a few execs understand Marketing, most do not.

And that is precisely why work comp services is a highly commoditized industry where price is critical. 

What does this mean for you?

Marketing’s budget should be 2 percent of your revenues, and led by someone who really knows the subject.

Work comp medical expenses total around $30 billion.  Total US medical expenses amount to $3.6 TRILLION.

Clearly work comp is a minuscule part of the healthcare world; less than one percent.

This matters because health care providers – doctors, therapists, facilities, clinics – see very few work comp patients.  While some providers tend to see more work comp patients than others, it’s rare indeed for a provider’s work comp patient population to amount to more than 10 percent overall.

Think about this in terms of regulations, network relationships, systems integration, clinical guidelines and UR requirements.

One patient out of a hundred – that’s how many work comp patients the average physical therapist, prescribing physician, pharmacy or clinic sees. When regulators require prescribers comply with a new formulary or UR prior authorization requirements, they are asking the provider, and the office and clinical staff that work with that provider to:

• learn something new; and
• develop, implement, maintain, and potentially modify new workflows and communications protocols and standards.

How would this work out in your world?

In your work, how much of a hassle would it be if one out of every hundred customers – or even one out of 25 – required unique and special handling, different processes, and a failure to comply with those requirements could lead to some type of legal sanction or unhappy customer?

I would suggest that many regulators don’t factor in the obvious challenge inherent in getting clinicians to change their practices for one out of every hundred patients.

Yes, regulators need to ensure regulations meet legislative intent, but often regulators can influence that intent, educate legislators, and if nothing else work diligently to hopefully reduce the potential friction inherent in changed regulations.

Unfortunately, this often isn’t the case. As a result, conflicts arise, conflicts caused by misunderstanding or misinterpretation, or just plain ignorance.  These conflicts may well lead to increased litigation, angry patients, and/or delays in patient care.

It can also lead to providers dropping out of the workers’ comp system, as the hassle just isn’t worth it.

What does this mean for you?

A bit of perspective is always helpful.  It is also essential.

As my late father used to remind me quite often, better to do it right from the start than have to fix it later.

This month marks the second longest economic expansion in US history; it’s been a decade since things turned around back in June 2009.

Like all expansions, this one is going to end – and there’s mounting evidence it will happen soon.

The latest Fed forecast shows GDP growth slumping to 1.3% this quarter, driven in large part by a drop-off in commercial and industrial construction.

Without Congressional action, we will see another government shutdown this fall; the Treasury will run out of money by early November. There’s hope the Republican-controlled Senate and Democratic-controlled House will reach some sort of deal. Whether an increasingly-volatile President – who has been public about his lack of concern about the possibility of the US defaulting on its debt – will approve it is anyone’s guess.

Absent a deal, $125 billion in Federal spending will be cut immediately, thanks to the 2011 sequestration bill.

Manufacturing growth is slowing. New data shows the U.S. Manufacturing Purchasing Managers’ Index is at its lowest point since the last recession. From Bloomberg:

customers were postponing orders due to growing uncertainty about the outlook. Similarly, new business from abroad contracted by the quickest pace since April 2016 to the first decline since July 2018.

One industry that’s hurting is autos. The president’s latest moves to slap tariffs on Mexico will increase US consumer and business costs alike; the auto industry is particularly vulnerable as Mexico supplies a lot of car parts – and 2.6 million cars – to the US. Analysts project the tariffs would add about $1,300 to the price of an average car. If Trump keeps his promise to continue to raise tariffs, that will jump to $10,000 on Mexican-made autos and trucks by October.

This has caused so much consternation amongst Congressional Republicans that they are actually considering going against Trump…

There’s a lot more data out there on this – the inverted yield curve is perhaps the one most worrying to economists.

So, we can fix this, right. Well, it’s going to be a lot harder to dig out of the next recession than it was to crawl out of the Great Recession. It’s increasingly likely the Fed will slash interest rates this year in an effort to keep the economy growing. Of course, rates are already near historic lows and the Fed has few resources left to buy back debt in “quantitative easing” without risking rising inflation…the tools available to the Fed to reverse a downturn are few and may be overmatched.

What does this mean for you?

It’s going to happen. When it does, worker’s comp payers will see a downtick in claims frequency but likely a rise in claims duration.

From here, my take is the next recession is going to be long and deep; we just don’t have the tools to claw our way out of it.

Dr David Deitz moderated a panel of physicians tasked with describing the role of primary care in workers’ comp. Ed Bernacki, Jill Rosenthal of Zenith, and Will Gaines of Baylor Scott&White Health participated.

The takeaways –

• Primary care for occupational injuries which will evolve significantly over the next few years due to retirement of physicians, telemedicine and physician extenders.
• Most physicians never get any training in occupational medicine (I know, shocker) – therefore it’s no surprise communications with treaters can be frustrating and care management contentious at times.
• Hospital consolidation is affecting patient care, and direction of patients to the best provider can be hampered/interfered with if treating docs are required by their health system to refer to other providers in that system.
• Measurement of “performance” and “quality” is different for occ docs; we care about long-term outcomes and functional ability. Not enough payers are actually sharing scorecards/outcome reports with treating providers, and those who are aren’t doing much in the way of follow-thru to discuss results and ways to improve.
• Electronic Medical Record technology tends to be menu-driven, click-thru, or voice recognition  – all of which are inadequate at best.  Dr Gaines estimated EMR adds 90-105 minutes EVERY DAY to his workload. Not reimburseable, too.
  • Oh, and the doc is often looking at the computer or screen – not at the patient.
  • The EMR yet one more factor making primary care a less and less attractive specialty for new physicians. They just don’t want to deal with all that friction.