06/28/2013

What is the Difference Between an MCO & a TPA?

Midwest Automotive Parts & Service Association has been a partner with CareWorks to deliver high quality medical management and return to work services to businesses that have chosen CareWorks as their managed care organization (MCO) for workplace injury claims.

These services are designed to help businesses minimize the financial impact of workers’ compensation injuries and help injured employees restore healthy, productive lifestyles as quickly and safely as possible.

Everyother May, employers throughout Ohio have the opportunity to retain their current MCO or select a new one to be responsible for medically managing their workers’ compensation claims. We are pleased to report that CareWorks had another successful year and are excited about the opportunity to continue to serve MAPSA members.

If you are responsible for your workers’ compensation program, it is important to have a fundamental understanding of the role of your selected MCO, whether that is CareWorks or any other BWC-certified MCO in Ohio. It is also important to understand the role of a Workers’ Compensation Third Party Administrator (TPA) and the services they can provide to further promote a quality injury management program for your organization.

As part of our continuing effort to educate members and current CareWorks customers, included are some of the most notable roles and responsibilities of an MCO and a TPA. We hope the information is valuable in your efforts to best manage your workers’ compensation program.

What is the difference between an MCO and a TPA?

What is an MCO?
Under Ohio's Health Partnership Program, managed care organizations (MCOs) are responsible for the medical management of Ohio employers’ work-related injuries and illnesses. Every state-funded employer in Ohio must have an MCO, whose fees are included with the workers’ compensation premium you pay to BWC.

The core MCO functions include:

• Collecting initial injury reports and transmitting to BWC;
• Management and authorization of medical treatment to be received by an injured worker;
• Medical review and bill payment processing;
• Maintaining a network of BWC-certified healthcare providers;
• Return to work services;
• Utilization review;
• Processing treatment appeals;
• Providing an Alternative Dispute Resolution (ADR) process; and
• Training and education.
  
  

MCO functions are often performed by medical professionals and their processes are clinically focused. An MCO can make an impact by helping their employer customers avoid lost time claims. Lost time claims occur when an injured worker is off work for eight or more consecutive days.

A 2004 BWC Health Partnership Program Progress Report showed lost time claims can cost, on average, up to $51,000; while Medical-Only claims (less than eight days lost work) can cost, on average, only $820.

MCOs are intended to provide effective and timely medical care management that assists hurt employees in recovering from injury and returning to gainful employment. These successful returns to work, in turn, can help employers manage their long term insurance premiums.

What is a TPA?

A Third Party Administrator (TPA) assists employers in the administrative and financial aspects of their workers’ compensation claims.

Their responsibilities include:

§ Risk management advice to employers;

§ Group rating savings programs;

§ Claims investigation;

§ Claims administration, including claim acceptance and claim closure;

§ Industrial Commission hearing representation;

§ Evaluating claims for coverage applicability;

§ Ensuring timely and accurate premium payments; and,

§ Assisting employers in developing workers' compensation cost control strategies.

TPA staff typically consist of claims adjusters, account representatives and workers’ compensation professionals. Having a TPA is an effective way to control costs through claims management and group rating programs.

CareWorks values the relationship with MAPSAand its members and hopes this information provides a better understanding of the important role MCOs and TPAs play in Ohio’s workers’ compensation system.

If you have any questions regarding the services of CareWorks, please do not hesitate to contact me at 1-888-627-7586, Ext. 3510 or via email at ron.lucki@careworks.com.

Ron Lucki

CareWorks