Reminder: 2018 PBO is Now in Effect
While you enjoyed New Year’s Day, the Texas Department of Insurance, Division of Workers’ Compensation’s Performance Based Oversight process quietly took effect for insurance carriers. The PBO data time frame for the 2018 assessment will run from January 1, 2018 through June 30, 2018.
For this PBO review, the Division will utilize the same weighted measures that were used in 2014 and 2016, as described below:
1. Timely payment of initial Temporary Income Benefits by the insurance carrier – 40% weight
2. Timely processing of initial medical bills by the insurance carrier – 30% weight
3. Timely processing of request for reconsideration medical bills by the insurance carrier – 10% weight
4. Timely submission of Initial Payment data via Electronic Data Interchange (EDI) – 10% weight
5. Timely submission of Medical Bill Processing data via EDI – 10% weight
PBO assessments are conducted by underwriting company, not by group or by TPA. Carriers and TPAs should review their internal procedures with an emphasis on compliance with the five measures set out above.
The data sources used to assess performance of the above measures will come from the claim and medical data submitted electronically via EDI to the Division.
The TDI-DWC will have three regulatory tiers that distinguish among poor, average, and high performers in the system. Those assessed are deemed to have an impact on the system due to their volume of filings or initiation of benefit payments. The TDI-DWC is not asserting that high volume has a negative impact on the system. Those insurance carriers who are not assessed due to low volume are not absolved from regulatory duties or regulatory oversight when necessary.
In placing the selected entities into regulatory tiers, the TDI-DWC will conduct several steps to place each insurance carrier into an overall tier. The first step is to calculate the performance score (percentage) for each measure. Next, the performance score for each measure will be multiplied by the assigned weight value – the value is rounded up. This calculation of two percentages will then be multiplied by 100 to obtain a weighted value – the value is rounded up. The weighted value of each measure will then be added together to calculate the final score – no rounding. The final score will identify the overall performance standard for the assessed entity. The overall performance standard is defined below.
The final scores will be placed into three regulatory tiers based on pre-determined performance standards that distinguish among poor, average, and high performers in the system.
The performance standards are:
High Tier: 95 or greater
Average Tier: 80.00 through 94.99
Poor Tier: 79.99 or less
Should you have questions regarding this issue, please contact James Sheffield, Steve Tipton, or Bobby Stokes.
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