Pacific Health Care Organization Inc.
Through our wholly-owned subsidiaries we provide a range of workers’ compensation solutions to employers in California. These services include managing and administering Health Care Organizations and Medical Provider Networks, implementing and administering Workers’ Compensation Carve-Outs, utilization review, medical bill review and nurse case management. We are also preparing to offer lien representation services.
Through our two HCO licenses, we offer injured workers a choice of enrolling in an HCO with a network managed by primary care providers requiring a referral to specialists or a second HCO where injured workers do not need any prior authorization to be seen and treated by specialists.
The two HCO certifications obtained by Medex cover the entire state of California. Medical and indemnity costs associated with workers’ compensation in the state California are billions of dollars annually. Our two HCO certified programs have contracted with over 3,900 individual providers and clinics, as well as hospitals, pharmacies, rehabilitation centers and other ancillary services making our HCOs capable of providing comprehensive medical services throughout this region. We are continually developing these networks based upon the nominations of new clients and the approvals of their claims’ administrators. Provider credentialing is performed by Medex.
As discussed above, under the HCO guidelines, all HCOs are required to pay certain fees. These requirements increase the administrative costs of an HCO, although, as a result of the restructuring of the HCO enrollment fee, such differences are no longer substantial.
Due to multiple HCO requirements, many clients opt to use the less complicated MPN even though the client has less control over the employee’s claim. The HCO program gives the client, in most cases, 180 days of medical control in a provider network within which the client has the ability to direct the claim. The injured worker may change physicians once, but may not leave the network. Whereas the MPN program seems to allow medical control for the life of the claim, but contains provisions that allow the employer client’s control of only the initial treatment before the employee can treat with anyone in the network. In addition, the MPN statute and regulations allow the injured worker to dispute treatment decisions, leading to second and third opinions, and then a review by an Independent Medical Reviewer, whose decision can end up with the employer client losing medical control. A significant number of employer clients have availed themselves of the MPN. Others utilize the provisions of the HCO plus MPN program.
Unlike HCOs, MPNs are not assessed annual fees and no annual enrollment notice delivery requirements. MPN’s are only required to provide an enrollment notice at the time the employee first joins the MPN and a second notice must be delivered to the employee at the time he suffers a workplace injury. As a result, there are fewer administrative costs associated with administering an MPN program, which allows MPNs to market their services at a lower cost fees than HCOs.
In March 2011 we incorporated Medex Managed Care, Inc., in the state of Nevada, as a wholly owned subsidiary of the Company. In April 2011 MMC took over the responsibilities of overseeing and managing the utilization review and medical bill review business previously managed by Medex.
Utilization review includes utilization review or utilization management functions that prospectively, retrospectively, or concurrently review and approve, modify, delay, or deny, based in whole or in part on medical necessity to cure and relieve, treatment recommendations by physicians, prior to, retrospectively, or concurrent with the provision of such medical treatment services pursuant to California Workers’ Compensation law, or other jurisdictional statutes.
We provide UR to self-insured clients, insurance companies and public entities. UR helps to reduce costs for the payor and determine if the recommended treatment is appropriate. MMC offers automated review services that can cut the overhead costs of our client and increase payor savings. Our UR staff is experienced in the workers’ compensation industry and dedicated to provide a high standard of customer service.
Medical bill review (“MBR”) refers to professional analysis of medical provider, services, or equipment billing to ascertain the proper reimbursement. Such services include, but are not limited to, coding review and rebundling, reasonable and customary review, fee schedule analysis, out-of-network bill review, pharmacy review, PPO management, and repricing.
In connection with our MBR services, we provide bill review (cost containment) services to self-insured employers, insurance companies and the public sector to help reduce medical expenses paid by our customers. In providing these services we provide network savings on top of State Fee Schedule savings allowing top provider networks to achieve savings.
We offer our clients with quick turnaround, state of the art software and the expertise of our bill review staff. We are committed to service and believe the reputation of our staff sets us apart from our competition.
On February 13, 2012 we incorporated Medex Medical Management, Inc. (“MMM”) in the state of Nevada, as a wholly owned subsidiary of the Company. MMM will be responsible for overseeing and managing nurse case management (“NCM”) services previously managed by our subsidiary Medex.
Nurse case management is a collaborative process that assesses, plans, implements, coordinates, monitors, and evaluates the options and services required to meet an injured worker’s health needs. Our nurse case managers use communication and available resources to promote quality, cost-effective outcomes with the goal of returning the injured worker to gainful employment and maximum medical improvement as soon as medically appropriate.
Our credentialed registered nurses have expertise in various clinical areas and extensive backgrounds in workers’ compensation. This combination allows our nurses the opportunity to facilitate the medical treatment while understanding the nuances of workers’ compensation up to and including litigation. By providing these services, we contribute to effective delivery of medical treatment assuring the injured worker receives quality treatment in a timely and appropriate manner to return the worker to gainful employment.
In June 2010 we acquired Arissa Managed Care, Inc., as a wholly-owned subsidiary of the Company to sell services offered by MEDEX, IRC or any other subsidiary of the Company. In February 2012 Arissa changed its name to MEDEX Legal Support, Inc. and plans to offer to its customers all aspects of lien defense from negotiation to lien litigation, including filing petitions for reconsideration. MLS plans to provide its clients a broad comprehensive lien representation program, while settling liens resulting in high potential savings for its clients. Subsequently, the previous owners of Arissa were allowed to again utilize the Arissa name in conducting their own business.
In 2001, we incorporated Workers Compensation Assistance, Inc., (now known as Industrial Resolutions Coalition, Inc.), as a wholly-owned subsidiary with the intent of pursuing other opportunities in the workers’ compensation field. Toward the end of 2007, we identified a business opportunity within the workers’ compensation field that we have begun to pursue. Through IRC, we seek to create legal agreements for the implementation of Workers’ Compensation Carve-Outs for California employers with collective bargaining units, and the administration of such programs within the statutory and regulatory requirements.
The California legislature permits employers and employees to engage in collective bargaining over alternative systems to resolve disputes in the workers’ compensation context. These systems are called carve-outs because the employers and employees covered by such collective bargaining agreements are carved out from the state workers’ compensation system. The goals of a carve-out include: