“STOP!” That is what we told this client. The definition of insanity is to keep doing the same thing over and over again and think you are going to have a different result. To stop the madness, you have to know the driving factors behind the increases.
But there was no data. This company had 32 employees, which meant the insurance carriers would not provide the needed information.
When this company came to us, one of the first steps we took was to go through the medical questionnaires. There had to be something that would give us a hint about what was driving the increases. Yet there wasn’t. We came up with nothing. So we put together a survey hoping to find something the employees could provide. But unfortunately, the survey did not produce anything that would substantiate the increases.
After taking all the information and determining there were no large claimants or medical conditions that had warranted the past increases, we enrolled the group in one of our affinity programs using a level-funding product. The affinity product was competitively priced and would provide data, should the group have a high loss ratio.
And that’s exactly what happened. We found the answer in the data! The insurance covered 111 people (including 62 employees, 12 spouses and 37 children), of which 81 had at least one medical claim.
What we found particularly interesting is there were 472 doctor visits within a 12-month period. That means all 81 members each went to the doctor 5.8 times! Put another way, there were 39 physician office visits every month. This begs the question, other than people with chronic diseases, who goes to the doctor six times a year? To have 81 people making six visits a year to a medical professional seemed extreme, to put it mildly.
Compounding the situation was that during each physician office visit, there were prescriptions and diagnostic tests (such as MRIs, CTs or other costly screenings) at out-patient facilities. This added up to 172 diagnostic tests and averaged two tests per person, and none of it was for treatment of chronic disease!
At this point we began to think there was some type of fraud. After all, how many people really go to the doctor this often?
We then asked the TPA for a list of all the physicians used by the group and found a disproportionate number of claims all came from three doctors. That was confirmation to us that each doctor visit was indeed taking place.
Where the disconnect came was when doctors overused the system. For instance, if a child went to a medical clinic for strep throat, the doctor would prescribe medication and then ask to see the child again in a week for a follow-up, and perhaps a week later as well for another follow-up. In other words, the doctors had people returning again and again, often when it was unnecessary.
Through employee education and awareness, we were able to reverse this trend. That took some time, almost two years. However, the financial results as well as the well-being of the employees have been much improved.