Paduda: The CBO's Single-Payer Report and Worker's Comp

Monday, May 6, 2019 | 0

The Congressional Budget Office's 34-page analysis of single payer is out, and there are no references to workers’ comp or occupational injuries/illnesses. 

Joe Paduda

That doesn’t mean there aren’t plenty of ways single payer would affect work comp.

Briefly, single payer is a very broad term that overgeneralizes a bunch of very different approaches to universal health insurance coverage. As defined in the CBO report, in single-payer programs “people enroll in a health plan operated by the government, and the receipts and expenditures associated with the plan appear in the government’s budget.”

When you recall that work comp accounts for about 1% of total U.S. medical spend, it’s no wonder the CBO report ignores us. But how single payer would affect comp depends on two core issues: whether care for occupational injuries/illnesses is covered by single payer, and whether there is a universal fee schedule.

If WC care is included under single payer, it is likely that work comp would evolve to an indemnity-only system. This exists in several other countries and seems to work pretty well.

If WC medical care is not included in single payer, the impact would be driven largely by the presence — or absence — of a universal fee schedule. 

Without that universal fee schedule, providers would likely continue to do their revenue maximization thing, although they’d supercharge those efforts. Why? Because reimbursement from all other payers would drop significantly, and providers would look to comp to replace as much of that lost income as possible.

What does this mean for you?

The health care system is the elephant, and workers’ comp is the mouse.

Joe Paduda is co-owner of CompPharma, a consortium of pharmacy benefit managers. This column is republished with his permission from his Managed Care Matters blog.