Is Hospital Consolidation Creating Bigger Goliaths for Adjusters

552836922_347b479dceAs the Affordable Care Act, or “ObamaCare”, rolls out across the nation, hospital systems are consolidating to respond. While Obamacare doesn’t directly deal with Workers Comp. one unintended consequence for Workers’ Comp adjusters and Workers’ Comp Insurance providers is that they will be forced to deal with larger health systems and more aggressive billing practices.

Susan Livio, of New Jersey’s Star-Ledger, reports “Hospital mergers have been a reality in the medical world for decades, but included in the Affordable Care Act, the sweeping legislative overhaul that transforms much of the health care industry, are a number of provisions that many experts believe will increase the pace of mergers, acquisitions and strategic partnerships.”

Some fear that this consolidation will result in higher costs for consumers and providers. interviewed Professor Martin E. Gaynor of Carnegie Mellon University, who said “The strong evidence is that these kinds of mergers raise prices anywhere from 20%, 30%, 40% up to 50%.”


Part of this consolidation is a result of costly requirements for electronic records and billing systems designed to improve overall system efficiencies. These technology costs can be simply too great for smaller hospitals and physician groups, reports Livio.

All of this creates bigger and more powerful entities for workers’ comp adjusters to deal with. Jerry D. Poole wrote recently in Claims Management Magazine: “Consolidations and capital investments mean that claims handlers increasingly will be dealing with large billing groups and sophisticated electronic billing systems designed to maximize provider revenue. These systems, which understand the intricacies of medical billing, will put additional pressure on claims handlers to scrutinize submissions for relatedness and appropriateness and to fend off facility fees and the like.”

How will adjusters deal with these bigger and better equipped Goliaths? Will more adjusters be needed to handle the increasingly complicated bills? Will increased training address this? Or will technology be required to assist adjusters? Or will we all just need a few more spa days and lattes? I’d love to hear from adjusters with specific strategies and tips for 2014!

What's your take? Continue the discussion with others over at the WCInsights LinkedIn Group.
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