Through our partnership with Risk & Insurance magazine and other media opportunities, we have written the following informative article.
The Auto Payers’ Checklist for Selecting a Pharmacy and Ancillary Program to Manage Claims
While auto and workers’ comp insurers see many of the same kinds of claims, handling auto claims takes a specialized knowledge base to reach the best outcomes for payers and patients.
When someone is injured in an auto or workplace accident, what happens next? That depends on the state, due to differences in regulations, legislation, and requirements. While industry expertise is helpful for managing both auto and workers’ comp claim types, there are substantial differences between them. Auto adjusters need specialized knowledge and resources that are tailored for the claims they manage.
While the core question in workers’ comp is whether the person was injured on the job, the auto side can be more complex.
As A.J. Carrier, AVP of Account Management with Optum Auto No-Fault (Optum), explained, “Eligibility questions are often the first hurdle of auto claims.” He added, “In a motor vehicle accident, the first question is, was the policy holder in the car? Then, if they weren't in the car, did the person driving the car have permission to do so? Were there passengers, and were they injured? Depending on the state, do the passengers have coverage that might be primary?”
That's a real challenge in the auto industry. The claims are complex because there's so much work that needs to be done before you can even consider whether there’s an eligible claim to manage.
Payers understand the intricacies involved in managing auto claims, but it’s really important that their business partners — like those who provide their pharmacy and ancillary benefits programs — do as well.
Optum understands. To demonstrate, Carrier and Melissa Dillingham, Optum Senior Account Manager, outlined key considerations for selecting a Pharmacy and Ancillary Program partner.
Industry Experience and Knowledge
“A knowledge of the auto industry from all sides is essential,” said Carrier. “You want a vendor who is dedicated to auto claims — because there are many complexities compared to other lines of business, such as workers’ comp,” he added.
This includes an in-depth understanding of the types of auto injuries and also the variations in auto coverage by state. Auto claims are often covered by Personal Injury Protection (PIP), which is required in 12 states, with varying coverage requirements. There are also seven other states and the District of Columbia that require insurers to offer PIP, but the coverage is optional.
“A lot of vendors may manage workers’ comp claims and then add in the auto claims for the payers that have both lines of business. The problem is, they often try to manage auto and workers’ comp claims the same way,” explained Carrier. “At Optum, we know auto and we understand both the vendor’s and the payer's side of the business.”
An Understanding of the Auto Legislative and Regulatory Environment
“Remember, regulations vary from state to state, so you need to make sure your vendor has a presence in the regulatory arena,” stated Carrier.
Optum has a Public Policy and Regulatory Affairs team that monitors the policy actions of every state. “This team is instrumental in helping us understand and then communicate to our clients any regulatory changes in the auto industry. For example, there were recent changes to the New York fee schedule and significant changes in Michigan regarding policy limits, and a new fee schedule as well,” Carrier said.
A partner needs to be vigilant regarding compliance, with many changes going into effect retroactively. As Carrier noted, “Your vendor needs to be watching this so you can pivot as those changes happen.”
“It is an ever-changing landscape in auto. If you're not keeping pace with all of it, the programs where you think you're going to be saving your client money could be a disaster,” he cautioned.
Adjusters have a lot coming at them all at once. The last thing they need is a program that creates more work. They need systems and workflows that run as simply and seamlessly as possible.
“Optum makes this possible with our dedicated auto portal,” said Carrier. “At a glance, our portal includes the information an adjuster needs to manage a claimant's history, track status, and run ad hoc reports,” he added.
The portal also allows payer management to run reports at a moment's notice to track their business.
“Beyond that, the program needs to be simple for the injured party,” Carrier said.
Dillingham agreed, “In my professional life, I’ve been on the payer side and I’ve been on the vendor side. In my personal life, I’ve also been the injured person from an auto accident. With my claims and industry experience, I was able to navigate my auto claim. But most people don’t have that benefit and without a simple auto program, it can be confusing.”
“And, if they've worked with a vendor that doesn't make their life easy, they're going to blame the payer — the insurance carrier — probably not the pharmacy or ancillary vendor,” she added.
Payers know this. Optum understands as well.
“A satisfied claimant is a satisfied policyholder, and they are more likely to renew their policy,” stated Dillingham. When someone files a claim, their insurance company basically has one chance to leave a good impression on the claimant. The claimant needs to be able to get their prescriptions and their ancillary equipment and services without hassle.
“If a claimant has a bad impression or trouble with their medications or ancillary supplies, more often than not, once their policy expires, that claimant is going somewhere else,” said Carrier.
The auto industry lags behind the workers’ comp industry in its adoption of pharmacy and ancillary programs. However, as the industry matures and utilization of these services increases, there is a stronger focus on the medical management of claims, including the control of pharmacy spend.
“Optum’s program kick starts our clinical focus with a strong medication formulary for auto claims,” said Carrier. “In workers’ comp there are many different types of possible injuries because of the wide range of jobs and risk. However, injuries in auto claims tend to be traumatic in nature, so the medication formulary is a bit tighter or more restrictive,” Carrier added.
Optum has developed and modified our auto-specific medication formulary for over 20 years. We continue to monitor it to make sure it lists the right medications for the most common auto injuries.
Along with the medication formulary, the Optum program includes a strong clinical presence.
Carrier explained, “We have pharmacists on staff who guide adjusters as they receive pharmacy transactions. We help them understand what the prescribed medications are for and if the medication makes sense for that type of injury.”
Management of opioid usage is also a core concern for the safety of patients, as well as the bottom line. Optum closely monitors opioid utilization and has proactive resources to safely initiate weaning or tapering of opioids as appropriate.
“We don't expect adjusters to be opioid experts,” stated Dillingham. Triggers within the Optum systems identify claims and capture pertinent claim information, allowing us to help adjusters work with physicians to better manage the claimant’s care.
A good pharmacy and ancillary partner should help you accurately gauge the performance of your program.
“You can have a great program, but if your vendor is not providing you with the appropriate reports, you don't know how good the program is or where it can improve,” said Carrier.
Payers need consistent reporting on spend and savings for pharmacy and ancillary services. They also need the ability to drill down to the state and claimant level when needed.
Plus, with Optum’s extensive claim data history, they can use predictive analytics to support the stakeholders on a claim.
Carrier emphasized this advantage. “Optum uses predictive analytics to identify early interventions for different types of medications, such as opioids. This helps us prevent misuse before it even starts. With the right reporting, we’re able to see the triggers as they start unfolding.”
The Right Access to Care
The regionalized nature of auto no-fault claims poses challenges for payers, since some providers may only work in a few select states. This leaves gaps that make it difficult for payers to fulfill the needs of their claimant population.
“You need a pharmacy and ancillary partner with a strong network of providers,” said Carrier.
Optum offers a network of providers for the primary auto-specific states and regions. This is backed up with a strong national network of providers, which gives us the ability to better negotiate pricing and provide access to care wherever it is needed. This is critical.
“We want a program that is convenient for the claimants. With the Optum program, conservatively speaking, 95% of the claimants live within two miles of one of our network pharmacies,” stated Carrier.
Technology That Fits Your Business
In most industries, IT resources can be scarce and expensive. So finding a partner with the right technology — that limits the need for payer IT resources — is key.
“We know that today, payers — and all organizations — have to prioritize the projects or programs they want to implement because of the drain on IT resources. There is definitely a ‘get-in-line’ mentality,” stated Carrier.
Optum answers that challenge with data transfer ‘bridges’ that connect with all major national and regional bill review vendors.
With these bridges, “As soon as a transaction hits the bill review program, it hits the adjuster’s pharmacy or ancillary portal and they can start viewing that information,” explained Carrier.
Carrier continues, “Optum knows that the quicker you bring a claimant and their injury-related transactions and bills into the program, the more you can save on claim costs and the more managing you can do for that claim.”
An Easy Claim Experience
When a claim is reported to a payer, the claim experience should be simple for everyone.
A claimant should be able to go to the doctor, get their prescription, and pick up their medications at the pharmacy at no charge to them.
A payer should be able to access and monitor claim information as quickly as possible.
Leveraging technology, Optum makes both of these things happen seamlessly.
“We have the ability to text a claimant their pharmacy card information so they have what they need to get their prescription without hassle,” said Carrier. “It's about making it simple for the injured parties.”
The Optum portal gives payers access to pharmacy transactions so they can monitor and manage claimants and their overall program.
Empathy and Support
The auto industry is way beyond the old “pay cash at the pharmacy and we'll reimburse you for your prescriptions” model of the past.
“It's bad enough that you're hurt,” said Carrier. “You shouldn't feel financial pain from your insurance company or any vendors they're using. You just want to get better.”
Optum keeps pushing the industry forward with pharmacy and ancillary programs that make the process, the care, and the overall claim experience better for everyone.
“Through our clinical oversight and technology, Optum is the second set of eyes a payer needs on their claims,” stressed Carrier. “Our programs are designed for the specificity of the auto industry and are there to help make sure that the claimant gets the medications and the treatments they need, when they need them. We want to help each injured person recover or get back to function in the best way possible.”
A.J. Carrier, AVP of Account Management, Optum Auto No-Fault
Melissa Dillingham, Senior Account Manager, Optum Auto No-Fault