James J. Mathis has been employed in the insurance industry for more than fifteen years. Formerly with Allstate Insurance and State Farm Insurance, during that time, he was also a claim representative as well as a manager in charge of all Med-Pay claims and Personal Injury Protection claims in the State of Washington. In addition, he was designated the company representative in class action lawsuits brought against the insurance industry for refusing to pay or reducing the amount paid for chiropractic treatment.
Mathis has been sought as a speaker for trial lawyers associations and chiropractic associations throughout the United States and Canada on the issue of insurance industry philosophy and procedures involving medical treatment provided by chiropractors. In the last four months of this year, he will be speaking at such seminars in more than 27 states, providing two- and three-day seminars and workshops for chiropractors who may be interested in knowing how to avoid the delays and denials by the insurance industry.
In an interview with The American Chiropractor (TAC), James J. Mathis describes the growing conspiracy against chiropractors by the insurance industry, and offers suggestions for chiropractors to help you “take back control” of your future.
TAC: What did you learn while working with Allstate and State Farm Insurance that would be of the most interest to chiropractors?
Mathis: While employed in the insurance industry, I was made aware of the adversarial attitude toward chiropractors by the insurance carriers. The employees of the insurance industry are actually trained to suspect all treatment provided by chiropractors. There exists a discrimination of the chiropractic profession, which results in chiropractic treatment and billing being denied, in part and in whole. The insurance industry determined that one of the largest areas in which claim cost could be controlled was the chiropractic care provided to injuries sustained in accidents. By significantly and successfully reducing or denying this medical cost, the industry would realize a reduction of claim payments. This would, naturally, affect the overall profit sought in the claim departments of the individual insurance carriers. Chiropractic care is targeted because of the large number of claims which experience this type of treatment.
The purpose of this claim-handling philosophy and procedure was to recapture billions of overpaid claim dollars as determined by the insurance industry. In fact, there appeared insurance industry slogans during this time period such as, “Bring Back a Billion”. Insurance industry claim departments were viewed as profit opportunity entities. Goals were developed to produce billions of dollars from a reduction in claim payments. To ensure the success in achieving these goals, the individual claim representative, associate or processor performance was determined based on their individual contribution to realizing these goals by their claim handling.
TAC: What do you discuss in your television and newspaper interviews with the likes of NBC Dateline and The Wall Street Journal about the insurance industry?
Mathis: I have been interviewed, video taped and quoted regarding the insurance industry’s use of “Captive Vendors” to perform reviews of medical treatment provided to their policyholders for the sole purpose of reducing or denying the duration, frequency, type and cost of medical treatment received for injuries sustained. These vendors would be sent, by insurance carrier, the chart notes and medical billings of a policyholder. Subsequently, the vendor would return an opinion that the treatment type, duration, frequency and/or cost was unnecessary or unreasonable and should be denied. The insurance carrier would rely on this opinion to deny the payment for medical treatment.
This practice of “Captive Vendors” was one of the most egregious processes used to reduce payment of policyholders’ claims and generate profit for the insurance industry. This secret practice by the insurance industry was kept from the community of policyholders throughout the country. While the insurance carriers were realizing profits from non-payment of claims, the policyholders were being denied treatment. The treating physicians (mostly chiropractors) were being denied payment for the treatment provided. The relationship between the treating physician and the policyholder, as a patient, was strained, if not completely obstructed.
If a policyholder or treating physician complained, they would be provided with scripted responses so as to dissuade any disagreement with the opinion of the vendor. Should a policyholder or treating physician seek the assistance of an attorney, they would be dealt with by defense counsel prepared to harass, intimidate and prolong the process to the point of complete frustration by the policyholder or treating physician. Ultimately, most complaints by policyholders and treating physicians would be forsaken. The economic strain, emotional intimidation, as well as the long delay, would finally force the policyholder and/or treating physician to abandon the disagreement. The insurance carrier was well aware that this would be the result of these com-plaints. Those few instances where the issue was taken to the final outcome (trial and judgment by jury) and a victory for the policyholder and/or treating physician was realized were not an economic deterrent to the insurance carrier. The savings of claims not paid far exceeded those too few legal losses.
TAC: When did you stop working with the insurance companies and how did your relationship with them end?
Mathis: I stopped being an employee of the insurance industry in September of 2001. I had been working at Allstate in their “Represented Unit”, and made the decision to continue to work as a consulting expert and begin the initial steps of creating the software corporation, Sequoia Visions, Inc.
TAC: What important trends do you see happening in the insurance industry and its relationship with chiropractors in the future?
Mathis: There is a trend by the insurance industry to rely on computerized programs in the determination of reasonable and necessary duration, type, frequency and cost of medical treatment provided for injuries sustained in accidents. These computer programs remove the human element and human intelligence previously associated with the handling of medical claims. This trend also has allowed the insurance industry to reduce their claim personnel. Now, more claims can be handled by fewer people. The claims no longer involve the process of intelligence or decision-making. Also, the claims no longer require that experience of the claims handler be a factor. This has allowed the insurance industry to replace many seasoned and experienced claim handlers with computer data processors.
The insurance industry is realizing additional savings by centralizing the handling of medical claims, increasing inventory levels of processors and eliminating the need for higher salaried employees.
The future will be dictated by the adaptation of the computer programs and electronic services available to the insurance industry. Many treating physicians will be offered immediate payment in exchange for a 20% discount. This discount will increase each continuing year so as to represent another considerable savings for the insurance industry. The treating physician will be tempted to accept this offer in lieu of realizing months of delay, or even eventual denial, if they don’t.
The only recourse available is for all treating physicians to demand all that is owed in payment for treatment provided and to continue to suffer through the obstructive tactics by the insurance industry. But, even more importantly, the chiropractic physician needs to understand how the electronic processes, procedural requirements and practices of the insurance industry actually work. With this information, the treating chiropractor can successfully receive full payment for all treatment without denials or delays. It is possible, without an agreement of a reduction of payment, if an understanding of the processes and an application of significant practices occur by the chiropractor.
TAC: Tell us about your software program and how it can be used in the chiropractic clinic.
Mathis: Sequoia Visions, Inc., has developed software which allows the treating physician to realize success in dealing with the computer programs being utilized by the insurance industry. It has developed software for the legal community as well. All the software is compatible with each other. This means that the successes realized by the treating physician in having the insurance industry accept frequency, duration, type and cost of medical treatment results in more reasonable settlement offers for the claims of their patients.
The medical software is used by the chiropractic physician to document all the aspects of their patients’ injuries, symptoms and manifestations in the correct terminology, phraseology and sequence, so as to respond directly to the insurance industry programs. The program leads the chiropractor sequentially through their patients’ injuries in a very user-friendly style. Medical Report Expert, at the click of a button, will produce a medical report (Initial, Interim or Final) which will translate all medical documentation into the correct terminology, sequence and with the acceptable drivers for the insurance industry.
TAC: Do you have any final words or advice for our readers?
Mathis: Now is the time for all treating physicians, especially chiropractors, to take back control of their future. Failure to realize the importance of this opportunity will only result in the continuing discrimination by the insurance industry. As a result of the adaptation by the insurance industry of these computer programs and the procedural requirements surrounding their use by insurance employees, the window of opportunity exists to establish acceptable treatment frequency, duration, type and cost. The sole defense to future decreasing reimbursement for medical necessary and reasonable cost is knowledge and concerted effort. I would encourage all chiropractors to acquire the necessary knowledge and participate, as a group, through active communication.
James Mathis can be reached for questions or additional information by contacting Sequoia Visions, Inc, at www.sequoiavisions.com; phone (888) 737-8642 / (775) 849-8400; or snail-mail James Mathis, 205 Scotch Pine Rd., Reno, NV 89511.