MINUTES OF THE

      SENATE COMMITTEE ON COMMERCE AND LABOR

 

      Sixty-seventh Session

      February 8, 1993

 

 

The Senate Committee on Commerce and Labor was called to order by Chairman Randolph J. Townsend, at 8:30 a.m., on Monday, February 8, 1993, in Room 208 of Cashman Field, Las Vegas, Nevada.  Exhibit A is the Meeting Agenda.  Exhibit B is the Attendance Roster.

 

 

COMMITTEE MEMBERS PRESENT:

 

Senator Randolph J. Townsend, Chairman

Senator Sue Lowden, Vice Chairman

Senator Ann O'Connell

Senator Mike McGinness

Senator Raymond C. Shaffer

Senator Leonard V. Nevin

Senator Lori L. Brown

 

STAFF MEMBERS PRESENT:

 

Denise Pinnock, Committee Secretary

Linda Krajewski, Primary Secretary

Brian Davie, Senior Research Analyst

Frank Krajewski, Senior Research Analyst

 

OTHERS PRESENT:

 

Fred Hillerby, Lobbyist, Blue Cross Blue Shield of Nevada

Terry Sullivan, M.D., Medical Director, Rocky Mountain Health Care     Company (R.M.H.C.C.)

Mark Habersack, Workers Compensation Specialist, Harrah's Las        Vegas

Charles Nort, Lobbyist, Nevada Administrators

Scott Young, General Counsel, Nevada State Industrial Insurance       System (SIIS)

Dennis Nolan, Director, Risk Management/Loss Prevention, Mercy        Medical Services

Dennis Newcomb, Private Citizen

Richard Wellman, Private Citizen

Joe Baca, Private Citizen

Ollie Jones, Holistic Practitioner

 

 

Chairman Townsend opened the meeting at 8:30 a.m. and explained he would be allowing the legislators from southern Nevada to chair the committee meetings in Las Vegas.  He then turned the gavel over to Vice Chairman Lowden.

 

Senator Lowden announced the focus of the meeting would be managed care.  Fred Hillerby, Lobbyist, Blue Cross Blue Shield of Nevada, introduced Dr. Terry Sullivan, Medical Director, Rocky Mountain Health Care Company (R.M.H.C.C.).  Dr. Sullivan presented a slide show with his testimony (Exhibit C).

 

Senator Lowden noted the committee had voted the previous Friday to convert the State Industrial Insurance System (SIIS) to a managed care system, and had included willing provider language.  She asked how Dr. Sullivan felt about willing providers.  Dr. Sullivan stated having willing providers was not a perfect situation but, given political reality, was understandable.  He stated all providers really did need to be under contract.  Senator Lowden explained contracts and the means to purge physicians from the provider list were part of the proposed bill. 

 

Senator Lowden inquired whether Dr. Sullivan anticipated increased prices due to the willing provider language.  He replied the willing provider language would not change Nevada's system except to introduce contracts.  Therefore, he did not foresee any change in rates.

 

In response to a query from Senator O'Connell, Dr. Sullivan stated approximately 10 to 15 percent of their cases were appealed and settled.

 

Mark Habersack, Workers' Compensation Specialist, Harrah's Las Vegas, said Harrah's was in it's ninth month of a managed care system.  He said their system had a 600 member provider list.  Mr. Habersack stated there had not been any appeals filed pertaining to any medical decisions made in their managed care program.  At Senator Lowden's request he explained Harrah's light duty program and their 100 percent return to work rate.  He explained how employees are not paid their full wage while they are on light duty because it is not conducive to getting the employee back on full duty.

 

Mr. Habersack spoke of how Harrah's uses bonuses as incentives to reduce incidence of injuries in individual departments.  Senator Lowden voiced concern that those incentives would prevent employees from reporting injuries.  Mr. Habersack explained the number of incidents resulting in compensation, rather than the number of incidents, was used for the bonus program.  He said all employees were aware that getting immediate care when needed was paramount.

 

Senator Townsend asked how Mr. Habersack interacts with the third party administrator.  Mr. Habersack stated they work extremely closely.  He said the company, third party administrator, and utilization review group were a team.  They met on a monthly basis. 

Charles Nort, Lobbyist, Nevada Administrators, testified his company had been using managed care for some time. 

 

 

Senator Townsend wondered whether it would be feasible for the SIIS to go to a third party administrator and request they manage a number of claims.  Mr. Nort said it would.

 

Senator Shaffer inquired of Mr. Habersack how many employees were involved in the Harrah's managed care program.  Mr. Habersack stated there were 3000 employees at that time but they anticipated adding 2000 more in the near future. 

 

Senator O'Connell asked Scott Young, General Counsel, SIIS, to address the issue of whether the system's computer program could catch overpayments.  Mr. Young stated the SIIS had a much larger volume than the private third party administrators.  He said part of the problem was that the SIIS was so far behind they were getting rebilled, and the computer program mentioned by Mr. Nort could not differentiate between a rebill and a duplicate bill.  He stated the Price-Waterhouse program the SIIS was about to put on line would help deal with the problem of overpayments. 

 

Senator Lowden asked whether the witnesses had encountered problems with getting releases to light duty.  Mr. Habersack stated their third party administrator had made it very clear to their physicians that light duty was available for every employee.  He said good communication with the providers was essential.  Mr. Nort said he had not, overall, seen a problem with the light duty program.

 

Senator Lowden called for a recess at 10:20 a.m..

 

The meeting was reconvened at 10:40 a.m..

 

Dennis Nolan, Director, Risk Management/Loss Prevention, Mercy Medical Services, stated in his experience some physicians were setting very subjective limitations for light duty. 

 

Dennis Newcomb, Private Citizen, testified regarding his concern with the number of workers who get "lost" in the system.  He related details of his SIIS claim and told of how lack of communication caused many problems.

 

Richard Wellman, Private Citizen, spoke of how hard it could be to get answers from the SIIS.

 

Joe Baca, Private Citizen, told the committee of the hardship caused when he was denied compensation after being injured at the nuclear test site in southern Nevada.

 

Ollie Jones, Holistic Practitioner, recommended the use of holistic medicine and reflexology.

 

Mr. Nort pointed out in order to have effective workers' care management there must be effective communication.  He suggested a diary system which would bring up each claim at least once every 30 days for review. 

 

There being no further business, Senator Lowden adjourned the meeting.

 

 

 

 

 

 

            RESPECTFULLY SUBMITTED:

 

 

 

                                    

            Denise Pinnock,

            Committee Secretary

 

 

 

APPROVED BY:

 

 

 

 

                                     

Senator Randolph J. Townsend, Chairman

 

 

DATE:                                

??

 

 

 

 

 

 

 

Senate Committee on Commerce and Labor

February 8, 1993

Page 1