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Health reform may push medical claims to property/casualty insurers


LONG BEACH, California — The law of unintended consequences is playing out in the wake of the Patient Protection and Affordable Care Act as ramifications “trickle down” through the property/casualty space, said a speaker at the Public Risk Managers Association 2014 Annual Conference in Long Beach, California.

Without explicitly setting out to do so, the ACA “will increase claims costs; it will affect premiums,” said Rick Wakefield, speaking Tuesday at a session about the ACA's effect on P/C insurers. Underwriters “will have a difficult time adjusting.”

Increasingly, health care providers are seeking to move the cost of treatments from a patient's health care coverage, where fees are strictly governed by the new legislation, to the property/casualty space, said Mr. Wakefield, founder and president of International Healthcare Consultants, an independent health care consultancy.

As one example of what he calls “cost shifting,” or “condition shifting,” Mr. Wakefield showed how a radiologist could determine that a patient's injuries are due to a recent accident covered by a property/casualty policy rather than being a chronic condition, which would fall under the patient's health care coverage, thus reimbursing the treating physician at a much lower rate.

“This new environment of changing medical provider economics means that we have to retrain our claims folks,” said Mr. Wakefield. “When the system changes like it's changing now, one of the things we have to do is be able to adapt to that new system. Cost shifting, condition shifting — we can mitigate those things in the claims department; it takes training.”

One way to combat cost and condition shifting is to change the way data is collected and analyzed, said Mr. Wakefield. Focusing on collecting data on health care providers will allow insurers and claims personnel to be able “to see these cost shifting changes as they occur,” he said.