Insight, analysis & opinion from Joe Paduda


COVID catch-up

Like many, I’m suffering from COVID19 burn out. This weekend’s news that more than 200,000 of us have died from the disease was a much-needed kick in the pants; I’ll do better keeping track of news – good and bad – about the pandemic and its impact on us.

To start, kudos to the California Workers’ Compensation Institute for their excellent work tracking the impact of COVID on workers comp in the Golden State. Their interactive tool is here; takeaways from the latest update (for 2020 to the end of August) include:

  • CWCI projects there will be 48,000 COVID claims incurred through the end of August
  • About 13,500 will be denied
  • Healthcare will account for about 4 out of ten claims accepted
  • Retail and food services will account for about one of every eight claims accepted
  • Including both COVID and non-COVID claims, claim counts are down 26% from 2019 levels.


About 200,000 of us have died from COVID19; about one of every fifty of us has tested positive. And the number of infections keeps increasing at a troubling rate, especially in Rocky Mountain states and those just to the East.

Treatment  – 2 medications are helping infected patients, a couple more are showing promise, and – once again – hydroxychloroquine is NOT on that list.

Vaccines – 11 are in late stages of testing, and 5 are being used in a limited way (there’s overlap between these two groups)

WorkCompCentral is hosting a free webinar focused on the impact of COVID19 on Florida’s workers’ compensation system and stakeholders. The Registration is here; the webinar is tomorrow, September 29 at noon Pacific, 3 Eastern.

Lots more going on – will keep you posted.

What does this mean for you?

Wear a mask. Properly! over your nose AND mouth.

Thanks to Brad James for the reminder. 



Friday catch up

Pre-existing conditions, drug development, COVID-related GI problems, and marketing screwups…

First up, pre-existing conditions

Yesterday President Trump issued an executive order affirming “it is the official policy of the United States government to protect patients with pre-existing conditions.”

Well, yeah. It is today, because the ACA/Obamacare – which specifically protects patients with pre-existing conditions – is the law of the land, despite dozens of GOP efforts to overturn it. 

Couple other key issues.

  1. Without legislation signed into law, the Federal government – and the President – can’t enforce a “policy”.
  2. The executive order wasn’t released, so we don’t know what it actually says.
  3. The Trump Administration backs a lawsuit that would overturn the ACA and thereby eliminate pre-existing condition protections. 

What this means – don’t watch what someone says, watch what they do.

For more details on GOP and Democratic healthcare plans, click here.

Super-useful research on healthcare prices paid by private healthplans – kudos to RAND for updating their ongoing analysis. RAND compares prices paid by privately insurers – including work comp – to Medicare, allowing you to compare relative prices for individual facilities.

Thanks to Michael Costello for the link.

One takeaway – HCA hospitals are pretty expensive…(you can find prices for pretty much any hospital on RAND’s map)

Drug development

Pretty much all new drugs developed over the last decade relied on research you – the taxpayer – paid for.

That includes $6.5 billion of taxpayer dollars invested in remdesivir, one of the very few drugs found to be useful in treating COVID19.


Alarming piece in JAMA yesterday reported patients with Acute Respiratory Distress Syndrome caused by COVID19 are at significantly higher risk for major gastrointestinal problems. Pretty solid science behind the research.

An earlier article highlighted the opioid epidemic during the COVID19 pandemic; there are definite limitations to the research due to small sample size and possible clinician bias. With those provisos, key takeaways include:

Good news – J&J will start Phase 3 trials of its vaccine. Unlike some other vaccines, it is a single shot and can be stored in a refrigerator for up to 3 months (others require two shots and must be stored at ultracold temps).

Marketing malfeasance

And lastly, an excellent article in the Harvard Business Review about marketing in current times.  A critical takeaway – do NOT just talk about social responsibility; DO it. Kudos to Starbucks; after mandating that workers could not wear anything with Black Lives Matter while working, the company realized it screwed up and reversed course.

For the umpteenth time, if you do screw up, apologize fully and without dissembling.  None of these “I’m sorry if anyone is offended” non-apology apologies; from the article:

With “cancel culture” as pervasive as it is, a one-time reaction is as good as letting an issue get ahead of you. Instead, treat apologies or mea culpas as the first steps of an ongoing dialogue designed to bring about thoughtful and meaningful progress.

Here’s hoping the White Sox turn things around in the upcoming series with the Cubs…and your team wins this weekend.

Be well.


The most ridiculous thing I ever heard.

You Bet Your Life was a 1940’s radio quiz show featuring comedian Groucho Marx; contestants vied for prizes and cash.

If you or your family members have pre-existing medical conditions, the election is a reprise of the show – Republicans want to end coverage for pre-ex, and Democrats will keep that coverage in place.

If the Trump Administration’s Texas lawsuit backed by Republican Attorneys General succeeds, you can lose coverage for pre-existing conditions if you change healthplans, switch jobs, move, marry, divorce, or have a child. If Trump and Republicans win the case in Texas;

Briefly, Republican Attorneys General have sued to overturn the ACA, and the Trump Administration is aggressively supporting the suit.  The Trump Administration and AGs’ claim the entire law must be thrown out because the individual mandate — a penalty imposed on people who chose to remain uninsured – was killed by the Republican Congress in 2017.

In so doing, it would end protections for those with pre-existing conditions.

Make no mistake, if Trump et al win the suit and you have to change health insurance plans, you are at real risk of losing coverage  – or having to pay so much you can’t afford it.

Despite President Trump’s assertions, there is No Republican plan to assure those with hypertension, diabetes, a history of heart disease, cancer, anxiety disorder, or any other health condition will be able to afford health insurance.

If you just won lotto, you’re all set. If not, you’re screwed.

Ignore Trump’s claims that there is a replacement plan in the works because:

What they do have is bait-and-switch.

As Groucho would say about the Republican claim they’ll cover your pre-ex;

What does this mean for you?

If you or a family member have a pre-existing condition, this election is about you.

If you aren’t sure, here’s a list.

And if you think you can hide your condition, you can’t. 


Friday catch up; lots doing in workers’ comp

A very busy week indeed – here’s what happened.

MedRisk’s management changes

Long-time CEO Mike Ryan has stepped up to Executive Chair, and President Ken Martino is moving up to CEO. Mike has led the organization as President for more than 7 years. Founder and Chair Shelley Boyce named Mike CEO several years ago. I know Shelley, Ken and Mike very well.

MedRisk’s annual growth has averaged over 20% for the last decade. The company now employs 1,200 people, all located here in the US.

There’s no question MedRisk, perhaps the most successful company in the work comp services sector is in very good hands. (MedRisk is an HSA consulting client)

Mental health in the workplace – Great take on the big increase in workplace stress from HomeCare Connect’s Teresa Williams in today’s WorkCompWire.  Teresa notes that the percentage of adults with depression or anxiety has tripled over the last year. Her piece has helpful recommendations that employers:

  • list what they are doing to protect employees
  • be honest and straightforward about the employer’s financial situation
  • refer workers to trusted sources for information on COVID – NOT YouTube videos from random cranks
  • keep in mind that younger workers seem more vulnerable to stress than we older folks.

Progress in bringing science to claims handling

Congratulations to Gallagher Bassett’s Jeffrey Austin White and colleagues – GB’s Treatment Quality Index (TQI) was named Insurtech Initiative of the Year. The Index, coupled with Clinical Guidance, identifies which claims would benefit from what type of clinical attention and when to apply it.

There’s a lot of really good thinking behind TQI; it addresses one of the toughest challenges faced by claims handlers.

Innovate or else.

Coincidentally, GB’s Gary Anderberg PhD penned a terrific piece on what we have learned and can learn from COVID.  One of his 5 takeaways:

COVID has cast a strong light on the fact that we always act on imperfect, half developed information, that all decisions are provisional, that updating your data constantly and rigorously is not a luxury.

(GB is not an HSA client)

Gary’s piece came the same day the Harvard Business Review published a though-provoking article on innovation…noting one huge retailer spent 18 months developing and implementing curb-side pickup. This went pretty much nowhere…until COVID.

Substitute “telemedicine” for “curbside pickup” and “workers’ comp insurer” for “retailer” and you will learn a lot about the cost of not innovating.

What does this mean for you?

Great companies succeed by delivering the service customers don’t even know they want.


The Trump Healthcare plan explained – briefly

Yesterday we discussed Presidential candidate Joe Biden’s healthcare plan.

Today we’ll do the same for President Trump’s healthcare plan, which was promised to be ready before the upcoming election…

Five times this year President Trump has promised he will unveil a replacement for “Obamacare”. As of this writing, I have not been able to locate any such replacement plan documentation, web pages, policy statements or plan descriptions other than a couple described below. If you have any details, please share in the comments section below.

It’s not just me – Forbes wasn’t able to locate the President’s plan.

So, if you are looking for a brief explanation – you can stop reading here.

For those who want more detail, here it is.

Unfortunately it appears the White House’s healthcare page has not been updated since 2017 so we will have to rely on public pronouncements and speeches.

Trump’s campaign site does have a list of objectives, but no actual plan, policy description, or details on how these will be met:

This has made it rather difficult to analyze Trump’s plan, so we will have to use the President’s pronouncements to assume what his plan will be. Please note that wherever possible I have cited official White House or Trump Administration sources below.

Pre-existing conditions

The President has repeatedly stated that his plan will require “health insurance companies to cover all preexisting conditions for all customers,” including during a press briefing in early August. In that briefing, Trump stated:

Over the next two weeks, [emphasis added] I’ll be pursuing a major executive order requiring health insurance companies to cover all pre-existing conditions for all customers. That’s a big thing. I’ve always been very strongly in favor — we have to cover pre-existing conditions. So we will be pursuing a major executive order, requiring health insurance companies to cover all pre-existing conditions for all of its customers.

This has never been done before, but it’s time the people of our country are properly represented and properly taken care of.

[note – requiring health insurers to cover pre-ex conditions is imbedded in the ACA (sometimes referred to as Obamacare) and is the law of the land today as that provision of the ACA remains in effect.] source cited is US Dept of Health and Human Services, part of the Trump Administration

Takeaway – taking the President at his word, any new healthcare plan will provide coverage for pre-existing conditions. We do not know if the Trump Healthcare Plan will allow insurers to charge extra for that coverage, or limit coverage to some dollar amount. (that is not allowed under the ACA)

Medicaid changes

Trump has sought to end Medicaid expansion, change funding, and institute work requirements. While these all sound good in sound bites, like many complex issues things sound a lot less good when you peel back the curtain.

Ending the expansion of Medicaid would crush hospital financials, especially in rural, western, midwestern and southern states.  In many areas Medicaid is a critical funding source for facilities; those states that have expanded Medicaid (including deep red Oklahoma) would be in dire straits if the rug was pulled out from under them.

The President has pushed hard to change the way Medicaid is funded to a “block grant” method.  Essentially a block grant is a fixed amount of funding; this would replace part or all of the current funding which is based on a percentage of expenses.

Simple in concept, this is much harder to implement, and completely unsuited to our current situation where Medicaid enrollment is rapidly growing due to the fallout from COVID. We haven’t heard much about block grants of late from the President, so not sure if they are still under consideration.

The same is true for work requirements. Many low income folks don’t have internet access, which is required to submit the detailed documentation required under state Medicaid work requirements. Then they need reliable transportation to get to work – which many don’t have. And there are few jobs available these days in many states due to COVID.

Takeaway – Trump wants to end Medicaid expansion, change its funding mechanism, and require some recipients to work. It is highly doubtful any of this will happen.

Drug prices

The President has authored several executive orders around drug prices, but didn’t follow through on actually implementing those orders.

Trump’s move appeared to be intended to force pharma manufacturers to the bargaining table, but that hasn’t happened. Despite Trump’s statement that he would take unilateral action if pharma didn’t cooperate with him by August 25, he didn’t follow thru on that threat.

More troubling, pharma execs don’t know anything about any meeting or discussion.

Takeaway – no significant action to control drug prices is likely.

What does this mean for you?

It’s really hard to say. 



The Biden Healthcare plan explained – briefly

Healthcare will be the most significant near-term impact of this election.

If Joe Biden wins and the Dems take the Senate, here’s what we can expect.

Biden’s healthcare plan addresses the biggest problems with the ACA (known to some as Obamacare).

  1. Individual health insurance plans are way too expensive.
  2. About a third of all states didn’t expand Medicaid
  3. The big insurers have little competition.
  4. Medicare – and Medicare recipients – are paying far too much for drugs

Briefly, the Biden Plan would:

  • Cap individual health insurance premiums at 8.5% of income
  • Set up a public option like Medicare anyone could buy into
  • Allow 60-65 year olds to buy into Medicare
  • Have Medicare negotiate drug prices with manufacturers
  • Solve the Medicaid expansion problem by covering low-income folks in non-expansion states through a Federal program
  • Ban surprise medical billing for insureds that require out of network hospital care
  • Ensure pre-existing conditions are covered

The additional costs would be paid for in part by savings (e.g. drug costs) and abolishing the capital gains tax break for those making more than a million dollars a year. (More detail on this plan, along with pros and cons – is here.)

Does this solve the ACA’s problems?

It’s not a cure-all, but Biden’s plan does go a long way to fixing the ACA’s two biggest problems – healthcare is still unaffordable and prices are still too high.

For most families covered under the plan, healthcare costs would likely decrease significantly. The 8.5% cap on insurance costs is a major change as insurance premiums in many areas are north of $12,000 a year.

Healthcare providers would:

  • Scream if folks now covered by private insurers switched to a Medicare-type program as reimbursement would drop;
  • Cheer if a lot more patients had health insurance; hospitals’ indigent care costs are escalating rapidly

The real problem with healthcare costs in the US is our prices for services are way too high. Covering a lot more Americans thru a government plan would force facilities and providers to get a lot more efficient.

Over the last six years I’ve done many a deep dive into the ACA’s shortcomings and why they exist; posts are here.

Bob Laszewski penned a very good piece on the plan here. Well worth a read.


Friday catch-up

Lots happened this week – here’s the big stuff.

COVID’s impact on work comp

WCRI is hosting a free webinar on the delivery of medical care and RTW during the pandemic.  Hosted by WCRI CEO John Ruser PhD and Randy Lea MD, the webinar will also include Mark Herbert MD, an infectious disease specialist.

Sign up here for the September 24 event, it kicks off at 2 pm eastern.

Drug prices

No, payers’ drug costs are not dramatically higher. In fact, net costs after rebates and other payments are flat to lower.  That’s one of the key findings from Adam Fein PhD’s analysis of the top PBM’s results. Kudos to Express Scripts, CVS, and Prime Therapeutics for publishing true cost data; one only wishes all PBMs did the same.

Ever wonder where all those new drugs come from?

Well, pat yourself on the back – because you, dear taxpayer, funded most of the initial R&D behind new drug development. Here’s the takeaway:

every new drug approved by the Food and Drug Administration (FDA) for the decade from 2010-2019 was associated with basic science funded by the NIH.

The IAIABC’s annual meeting kicks off next week; registration is still open here. Lots will be covered, including a discussion of COVID claims, presumption, fee schedule improvements, and of course EDI.

David Dubrof is PBM myMatrixx’ new Chief Sales Officer. I’ve known David for 20+ years; he is one of the very few “A” players in work comp services sales and a consummate professional. (myMatrixx is an HSA consulting client). David is all in on myMatrixx’ industry-leading push for price transparency.

How’s that budget process going?

Imagine trying to set up a curriculum for an unknown number of students with an unknown level of education. Or meal planning for an unknown group with different dietary requirements that are also unknown.

Well, that’s budgeting 2021. Never has that been so…fraught/uninformed/scary/pointless as it is today. If you need a break from trying desperately to figure out how to justify/rationalize your 2021 forecast and budget, read this.  It’s an excellent discussion of budgeting in a time of huge uncertainty.

Family is coming in this weekend to celebrate our new granddaughter’s arrival – have to say this is much-needed these days; the nastiness and bad news is getting to be a bit much.

Hope your weekend is filled with joy.


Will the FDA keep your family safe?

Would you let your kids/parents/grandparents be injected with a COVID19 vaccine “approved” by the FDA?

The same FDA that lied about treating COVID with blood plasma and hydroxychloroquine?

How about the blood plasma scam? FDA chief Stephen Hahn flat out lied in public, claiming it “saved” 35% of COVID patients. Now the NIH has weighed in, refuting Hahn’s lies.

Now Trump et al want the FDA to issue an Emergency Use Authorization for a vaccine – something that has NEVER been done before, because it is incredibly dangerous.

Remember hydroxychloroquine? Touted as a miracle drug by the President, his Administration and allies, we know it is far more dangerous than helpful. And we knew that when the FDA gave it conditional use approval (that was later revoked).

Fox News on the FDA’s screw up…

Both were touted as solutions to COVID19 – and both claims were proven to be flat out wrong.

Now we have that same FDA telling states to prepare for a vaccine that will be ready in early November. The Centers for Disease Control is also involved.

The Administration is turning the FDA – once the world’s leading scientific authority on drug approval, research, and guidance – into a political machine. Lesser known is that the FDA’s oversight of pharma and food safety has plummeted under Trump.

Without full vetting of a vaccine, we do not know if it will hurt us more than help.

If this was happening under a Hilary Clinton administration I’d be screaming bloody murder.

What does this mean for you?

Elections have consequences. 




Another whirlwind week is just about over, and with it the summer of 2020.

Here’s important/interesting news that came across my virtual desktop this week.

COVID and Comp

More data on workers’ comp COVID19 claims is coming in; Virginia’s Workers’ Comp Commission has published data; key takeaway is to date, only 8.3% of COVID19 claims reported have resulted in benefit payments. That will certainly increase as claims develop.

More info on state COVID reporting is here – you can watch a recorded webinar on the subject here – Mark Priven and I dive into data from California and Florida and discuss the implications thereof.

Meanwhile, employment took another hit as last week more than a million Americans filed for unemployment. This continues a five-month run of claims at or above the million mark. 14 million of us are still without jobs.

COVID19’s impact on health insurance coverage

Several million people have lost their health insurance due to COVID19-related job losses.  We don’t know the specific number – and it is certainly increasing – but it is likely between 3 and 12 million. (download the report for details).

Another perspective is here.

Most of those folks are lower-income workers and many are minorities; some may be eligible for Medicaid however states that did NOT expand Medicaid such as Texas and Florida will see an increase in uninsured care costs.

Congratulations to myMatrixx and new Chief Sales Officer David Dubrof; David is one of the very few “A” players in work comp services sales; myMatrixx will benefit greatly from his sales leadership. David and his colleagues are equally fortunate; payers have consistently rated myMatrixx the top workers’ comp PBM. (myMatrixx is a client)

NCCI published a report on the impact of fee schedule changes on outpatient facility costs.  Good to see this rapidly-rising cost driver getting attention.


  1. Fewer jobs = lower payroll = lower work comp premiums
  2. Things are tough and getting tougher for lower-wage workers, which are disproportionally people of color.
  3. More uninsured = more need for facilities to get $$ from those who are insured.


BWC’s dividends and drug costs

Last week Ohio’s Bureau of Workers’ Compensation announced it will consider $1.5 billion in dividends to policyholders.

This comes on the heels of a similar payout in April;

$1.35 billion went to private employers and $184 million went to local government taxing districts, such as counties, cities, townships, and school districts.

Together, the two dividend payments amount to a refund of all premiums paid by employers in 2018 and 2019.

The Bureau’s very strong financial results were attributed to excellent investment performance, a continued decline in claim counts, and “prudent fiscal management.”

A significant piece of this “prudent fiscal management” was the audit of BWC’s pharmacy program, an audit that led to the State Attorney General suing BWC’s PBM OptumRx. Subsequently AG Dave Yost accused OptumRx of overcharging “the state on 57% of 2.3 million claims between January 2014 and September 2018.” [it is important to note that BWC’s prior PBM was acquired by Optum and operated under a separate business unit]

The suit was later amended to reflect Yost’s allegation that overcharges exceeded $16 million.

BWC switched PBMs two years ago.

BWC’s drug costs have dropped significantly over the last couple of years; while a decline in claim frequency undoubtedly contributed to that drop, it is safe to say that prices paid for drugs helped slash pharmacy expenses.

And that has helped fund the huge dividend checks BWC’s customers are getting.

What does this mean for you?

Do you know you are paying only what you should? 

How can you prove that to your policyholders and customers?

Joe Paduda is the principal of Health Strategy Associates




A national consulting firm specializing in managed care for workers’ compensation, group health and auto, and health care cost containment. We serve insurers, employers and health care providers.



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