1 – Health Care Organizations (HCO)

HCO’s are regulated organizations who provide assistance with claims management for Workers’ Compensation Claims. They take the claim from the date of the claim and micro-manage the claim until it is closed.

Labor Code 4600.3

http://www.leginfo.ca.gov/cgi-bin/displaycode?section=lab&group=04001-05000&file=4600-4614.1

gives the guidelines for management of Primary Care using a HCO. If a company uses a HCO, they get a minimum 90 days control of the primary care of their Workers’ Compensation Claims. If the company offers and pays 50% of the premium for a non-occupational medical policy for it’s employees it get 180 days control of the primary medical. It can even get up to 360 days control of primary medical based on other circumstances.

When the HCO does its’ job and micro-manages the claim and closes it efficiently, it can be a large factor in determining what your experience modifier will be in future years.

HCO’s must be approved by the insurer in order to use them.

When picking a HCO, you want to know if it is a participating or non-participating HCO. A Participating HCO will get a percentage of the claim for managing and assisting in closing the claim. A non-participating HCO will get a monthly fee per employee and manage and close the claim for that fee only. It is to your benefit to choose a non-participating HCO if it is available. The non-participating HCO has an incentive to close the claim as quickly as possible to maximum its’ income per claim.

T the present time HCO’s have become less attractive with the advent of the MPN created by the new CA Workers’ Comp laws. But, recent bills that will be presented on the ballot, if passed, would nullify the effectiveness of the MPN and the HCO will again become the prominent means to take control of claims management.

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