At this year’s National Comp conference, we had the pleasure of speaking with several self-insured employers, i.e., employers that cover their own injured workers’ care and benefits rather than paying premiums to a workers’ comp insurer.

Many of these employers already suspected that their workers’ comp vendors may not be serving them well. Far fewer understood how certain types of vendors may harm injured employees and drive up workers’ comp costs. Those vendors include:

•  Medical bill review companies, which review and adjust reimbursement to providers
•  Medical Provider Networks (MPNs), which restrict the employer’s workers to a chosen circle of healthcare providers
•  Utilization Review (UR) organizations, which dictate whether injured employees receive the care their treating physicians recommend

Employers were aware that bill reviewers could be significantly overcharging them, for example, by applying a contractual PPO discount where a simple fee schedule adjustment would suffice, then billing the employer a percentage of the resulting “savings.”

Few, however, understood how UR and MPNs can delay and deny medical care, potentially exacerbating employees’ injuries, dragging out claims, and worsening outcomes. In too many cases, delayed care drives disability costs and lost productivity when prompt, appropriate treatment could have returned the injured employee to work.

Unfortunately, a for-profit healthcare system’s incentives don’t always align with the needs of injured workers or employers. A cynical observer would note that the longer an injured worker remains injured, the more profit vendors (many owned or backed by private equity) can potentially generate.

Denials Drive Worker Out of CA

For a textbook illustration of how obstacles to care can lead to terrible outcomes for workers and employers alike, consider this story from Ascend, an occupational medicine consulting agency.

A California Qualified Medical Evaluator (QME) saw an injured worker suffering from headaches and neck pain after a ceiling tile fell on her at work. Her treating providers recommended injections to relieve the pain. More than a year later, the payer still had not approved the treatment.

The delay didn’t just deprive the worker of care and the employer of a worker; it deprived California of a productive resident. Unable to access care, the worker reportedly quit her job and moved to Texas, where she and her spouse could live on a single income.

As Ascend’s founding doctor put it:

“This worker left her job and moved to another state because she could no longer sustain her life as it was.

There are certainly workers’ compensation cases in which treatment is excessive, unnecessary, or unsupported. This was not one of them.

This is an example of the workers’ compensation system failing a legitimately injured worker.”

Self-insured employers should keep this story, and others like it, in mind. If a bill reviewer, network entity, or UR organization can’t produce credible data (not white paper-style self-promotion) showing that it consistently produces the best possible outcomes, it may be time to look elsewhere.

Self-insured employers must meet strict financial standards to prove they can cover their employees’ needs. They should hold their workers’ comp vendors to equally rigorous performance standards.

How Prolonging Claims Can Cost Employers

Employers hire vendors to ensure employees receive care while controlling costs. In some cases, the vendors accomplish neither. California offers a prime example.

California requires payer authorization for virtually every treatment, even when it aligns with state guidelines and is delivered by in-network providers. daisyData show that, historically, UR approves only about 70% of requested treatments, a figure that’s implausible at best.

Wide variations in approval rates from payer to payer suggest that the payer or UR organization involved, not medical need, primarily determines whether care gets approved. Sedgwick once boasted that 54% of the treatment requests it reviewed were denied or withdrawn, producing a “return on investment” for its clients.

When patients in other health systems appeal prior authorization denials, a considerable share succeed. In 2025, Medicare Advantage overturned 67% of appealed denials. For Medicaid managed care, the overturn rate was 47%. Denials in plans in the Affordable Care Act marketplace were overturned 43% of the time. Some individual plans overturned 90% or more of denials.

Yet, Independent Medical Review, the process by which injured California workers can appeal a UR denial, overturned just 10.2% of denials in 2025. The inescapable questions: What accounts for this difference, and is UR preventing injured workers from getting the care they need?

Meanwhile, it can be daunting for an injured worker to find an MPN physician eligible to treat them. As far as we can tell, no one meaningfully audits MPN access standards or otherwise enforces MPN laws and regulations. In practice, MPNs mostly funnel providers into discount reimbursement contracts, commodifying discount rates across the industry to generate profit.

Between MPNs and UR, an injured worker’s path to necessary care can be fraught. The path to proper reimbursement for that care can be odyssean for providers, leading many to leave the system.

The result is long claim durations, high disability costs, and lost productivity, exactly what employers want to avoid.

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