J. A. Schlueter & Company Offers a Mock California Utilization Review Audit Program to Evaluate the Compliance of Your UR Program

Business Wire,  July 7, 2008  

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LOS ANGELES -- All California claims adjusting and Utilization Review companies are being audited by the CA DWC. In addition to the potential fines levied for non-compliance, the individual audit outcomes are being posted on the DWC website. According to a DWC spokesperson, they will "continue to post what we find on line to give employers a chance to choose a UR program that's providing benefits correctly."

Speaking to a group of self-insureds via a web conference today, James Schlueter, President of J. A. Schlueter & Company, Inc. (www.jaschlueter.com), noted that "posting the individual audit results is an excellent tactic by the DWC to help raise the quality of this important medical management strategy." He said, "Done right, UR is a highly effective tool to prospectively control medical costs. Furthermore, it helps to raise the quality of care for injured workers by ensuring that procedures are delivered based on evidence-based guidelines rather than other agendas."

"Unfortunately," Schlueter said, "the DWC process, while thorough and deliberate, is going to take a while to show results; from 2007 to date, the DWC has reported on just ten audits." He noted that in February, 2008, his company conducted a survey of CA organizations conducting URs. The objectives were to raise awareness of and gage the overall compliance with the CA regulations.

An e-mail invitation to participate in a web-based survey based on the actual DWC audit questionnaire was sent to about 2,500 workers' compensation professionals responsible for UR. The 2,500 invitations generated approximately 225 hits on the web survey (9%). Of 225 hits to the survey, 75 completed it. Thus, there was an overall response of 3% and a 30% response of those that hit the survey site. See: http://www.jaschlueter.com/ur_solutions.htm

Schlueter said, "Overall, the responses reported were quite positive. Eighty percent of the respondents reported they were well prepared for the coming audits. However, twenty percent of the respondents noted they were either not certain of their compliance with the regulations or were clearly not in compliance in many areas."

Schlueter stated, "The fact that twenty percent of the respondents, at a minimum, are not certain of their compliance with the regulations is a substantial red flag for the self-insured employer that is ultimately responsible for the actions of their vendors. Self-insured employers should take aggressive actions to evaluate the performance of their vendors. They should not stand back and wait for the state to work through the eighty percent of the good ones to find the non-compliant providers." He said, "That is a bad decision on many levels."

Subsequently, Schlueter reported that his company is offering self-insured employers, TPAs and UR companies a "mock audit service." He said "the mock audit will include an audit similar to that which the DWC will conduct and a scorecard report similar to what the DWC is currently using. However, going beyond the DWC audit program we will evaluate the outcomes of the UR's provided and deliver a benchmark report to compare your outcomes to national averages regarding percent of approvals, modifications, delays and/or denials. Further," he said, "we will provide a benchmark on the average cost of your UR program. Thus we are offering an audit for quality and cost-effectiveness."

For more information on this program contact J. A. Schlueter & Company at 818-790-2392

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