Executive Corner


One of the things often overlooked in the world of workers' compensation is the effect of a strong bill review program for both medical bills and pharmacy benefits.  I think this is, in part, due to the perceived complexity of the billing and review process.  In an effort to simplify it, I will break down some common terms and discuss the impact our program has had on our customers over the last four quarters.  First, some common terms.

Fee Schedule - Fee schedules are determined at the state level and lay out the prices that a medical provider can charge for specific services related to treatment of work comp injuries.  Only a handful of states do not utilize some type of fee schedule.

Usual, Customary and Reasonable (UCR) - UCR is the amount paid for a medical service in a geographic area based on what providers in the area usually charge for the same or similar medical service.  UCR is typically used to determine the allowed amount.

Preferred Provider Organization (PPO) - PPO is a health plan that contracts with medical providers, such as hospitals and doctors, to create a network of participating providers.  You pay less if you use a provider that belongs to the plan's network.  While you are likely more familiar with this term as it relates to group health plans, PPO's are also prevalent in the world of workers' compensation.

Creative Risk Solutions partners with Equian to provide bill review and pharmacy benefit management on behalf of our customers.  In the last four quarters, we processed over 38,000 medical bills.  The total billed charges were over $40 million.

Fee schedule and UCR reductions amounted to $14.3 million, PPO reductions of nearly $2 million and a total reduction of $19.6 million for a 48.8% savings off billed charges.Regarding pharmacy benefits, we handled roughly 6,000 prescriptions with total charges of roughly $1 million and achieved a savings of 26.2% from those billed amounts.

These are real dollars which have a real impact on the overall cost of workers' compensation claims.  Don't ever hesitate to ask your TPA to show you what kind of savings they are generating on your behalf!

Ben Tebo

Vice President