Pay For Play
Pay for Play. External service providers provide "incentive payments" to workers' compensation claims TPAs for the ability to receive their business. We have long known of this practice in the workers' compensation claims TPA world. Flat rate claims service agreements in many cases do not provide sufficient income for TPAs. Many have willingly, in some cases without the knowledge of their clients, participated by receiving incentives and commission payments from external service providers. When we reentered the workers' comp claims TPA space in 2001, we rejected this flat rate, backroom "deal" business model in favor of an honest, tried and true time and expense service charge model.
It was with a great deal of excitement during the 2015 Montana Governor's Conference on Workers' Compensation that we read the blogs by Joe Paduda. Below are links to Joe's blogs that we encourage everyone on the industry to read and contemplate. We will providing an opinion piece about the practice as well.
http://www.joepaduda.com/2015/09/pay-to-play-yes-its-still-here/
http://www.joepaduda.com/2015/09/pay-to-play-whos-at-fault/
http://www.joepaduda.com/2015/09/pay-to-play-the-corporate-version/