Texas Performance Based Oversight for Healthcare Providers and Carriers

Texas Performance Based Oversight for Healthcare Providers and Carriers

The Division held its final PBO Working Group Meeting to discuss the DWC staff paper on the 2009 PBO assessment process. The Legislature required the Division to place selected insurance companies and health care providers in one of three tiers: high performer, average performer, and low performer.


Stakeholders criticized the initial PBO assessment. Some criticisms were as follows: (1) using a bell curve; (2) measuring carrier success rate at a Contested Case Hearing; (3) choosing readily available information instead of outcome focused findings; (4) lacking resources to study medical provider outcomes; and (5) publishing PBO results without correcting or explaining alleged data collection/interpretation errors.


As a result, the Division created a PBO Working Group. Changes in the 2009 PBO assessment are as follows: (1) no bell curve; (2) new process to identify and correct errors before the 2009 publication of the PBO scores; (3) removal of the Contested Case Hearing success rate measure; and (4) adding two new measures for insurance carriers and medical providers.

There are still significant shortfalls with the PBO assessment system due to limited State resources. The Division expressly stated they lacked the resources to study medical provider return to work outcomes and medical outcomes when compared to their peers. Some stakeholders also criticized the 95% cutoff rate for high performers and suggested the use of a 90% rating.

The Division’s use of a bell curve was controversial. The bell curve may or may not help carriers since, on one hand, it can limit the number of high performers and inflate the number of low performers. On the other hand, the bell curve can also limit the number of low performers. However, carriers successfully convinced the Division to remove the bell curve; a decision that could be later regretted.


There were 420 separate carriers or self-insureds with an Initial Pay (IP) transaction in 2007. DWC chose 142 carriers and self-insureds to participate in the PBO process representing 33% of all carriers. Carriers making 92.6% of all IPs will be graded. This group of 142 made at least 30 IPs in 2007. The breakdown is as follows: 89 Commercial Carriers (62.6%), 3 State entities, 40 Self-insureds (30%), and 10 Certified Self-insureds (7%). Of the 142 selected carriers, 124 or 84.3% were also involved in the initial PBO assessment (28 high performers, 81 average and 15 poor.)

For insurance carriers, the Division will use information collected between June through November 2008. Insurance carriers will be graded on the following measures and weights:

  • Timely payment of initial temporary income benefits (40%)
  • Timely processing of medical bills (40%)
  • Timely submission of initial payment (IP) data via electronic data interchange (EDI) (10%)
  • Timely submission of medical bill processing data via EDI (10%)


The Division found 872 providers billed for a DWC-69 and a DWC-73. Only 31% of all providers filed at least six DWC-69s and six DWC-73s. Out of the 276 doctors chosen, division-selected methodology identifies only 2 chiropractors that will receive a PBO score. (It is difficult to imagine that only 2 chiropractors in the State of Texas had six DWC-69s and six DWC-73s.) The Division will issue a Data Call for DWC-73s in order to assess the health care providers. Health care providers will be graded on the following criteria:

  • Timely filing of DWC-69 (35%)
  • Timely filing of DWC-73 (35%)
  • Completeness of DWC-73 (30%)

Some stakeholders urged the Division to assess medical providers on outcome-focused criteria utilizing the Return To Work Guidelines and Treatment Guidelines, since assessing medical providers on how well their office staff submits paperwork is not a true performance measure for health care providers. The tier rankings provide no relevant information to injured workers or employers in selecting quality doctors.

Once again, the performance tiers for medical providers are irrelevant to the issues of quality of care or return to work. The PBO score will not rate a doctor’s performance but instead will evaluate the performance of a doctor’s staff submitting timely and complete DWC-69s and DWC-73s. However, all attempts to expand the assessment of doctors was fraught with complaints from the parties: (1) the Division indicated they lacked the resources to properly study return to work and medical outcomes when compared to the Medical Disability Advisor or the Official Disability Guidelines; (2) the medical community complained that only doctors with the appropriate license could consider the appropriateness of medical care; (3) because each individual is different, a case by case assessment is required to differentiate among provider types, injuries, and gender. Based upon these and other difficulties, the Division once again determined it was impractical to study the quality of medical care or a doctors success in returning injured workers to work.

The Division did indicate they will study the DWC-73s collected from the data call. The Division may statistically analyze return to work outcomes utilizing MDA. In fact, it is this effort that may prove the most beneficial in the PBO assessment.


The Division plans to publish its initial findings between December 2008 and February 2009. From February through May 2009, the Division will review management responses; that is, allowing insurance companies and medical providers to review, challenge, and correct errors made by the Division in the data collection process. The Division reportedly will allow six weeks to review and respond. The Division plans to publish the final results between July and August 2009.

The Division will publish a summary of change document responding to each of the carrier’s responses. It is important to contact Stuart Colburn or Christy Karcher if you are not satisfied with your PBO assessment.


Carriers must review their policies and procedures. Health care providers are not terribly concerned. Does it seem right that only 2 chiropracters are selected? Will carriers bemoan the lack of a bell curve?