Managed Repair Programs

How’s that Obama Care working out for you. Did your rates go down like he promised…  One big failure or lie or whatever you’d like to call it.

How many of you think your doctor-patient relationship is better under managed care managed by your health insurer? The vast majority of health insurance policyholders and virtually all doctors think the insurance industry’s “management” of managed health insurance has eroded the doctor-patient relationship. Many good doctors have left the medical profession because they refuse to adhere to managed care requirements. You know what kind of doctors love managed health care. So, policyholders should get ready for the next “whammy” from the insurance industry—“managed repair.”  

The American Association of Public Insurance Adjusters (AAPIA) had an excellent discussion written by a very capable attorney, Jill Bowman, about a recent newspaper article in the Sun-SentinelFinalist for Citizens managed repair program purchased by global claims management firm. Without a doubt, there is a trend for some insurers, and many in Florida, trying to profit from losses by doing the repairs themselves or controlling costs by mandating repairs by designated companies.

In the traditional relationship, the policyholder selects a contractor to work with the repair following a loss, or the policyholder keeps the money from an adjustment. While virtually all insurance policies allow insurance companies to make the repairs or replacement if they invoke that option to do so, few have historically done that. This is changing.

Rather than allowing the policyholder to choose who the contractor will be to repair the damage, insurers are designating the contractor. They are doing so to “manage” costs and in some cases, to add additional profit by owning the repair company. Insurers argue that they can lower premiums by “managing” costs of repair the same way insurers argued they could “manage” premiums of health insurance through “managed care.” The problem is that rather than the policyholder being the decision maker for their body or their home, the insurer makes the decision effectively removing both the policyholder and doctor or contractor from the process of deciding what is best for the policyholder.

While the history of “managed repair” and the consequences of this trend have yet to be written, I suggest hose interested in lessons learned on how the insurance industry messed up managed care read,  Managed Care: What Went Wrong? Can It Be Fixed?

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