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Texas Department of Insurance
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Performance Based Oversight (PBO) - Insurance Carrier

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Insurance Carrier 2022 PBO Assessment Methodology

Downloads:

2022 Insurance Carrier Assessment Methodology Paper (pdf)


Weighted Measures |  Data TimeframeSelection CriteriaData Source | Tier Structure and Placement Methodology


Weighted Measures

The selected insurance carriers will be assessed on the following measures for the 2022 PBO assessment:

  1. 50% weight - Timely payment of initial Temporary Income Benefits by the insurance carrier
  2. 30% weight - Timely processing of initial medical bills by the insurance carrier
  3. 10% weight - Timely processing of request for reconsideration medical bills by the insurance carrier
  4. 5% weight - Timely submission of Initial Payment data via Electronic Data Interchange (EDI)
  5. 5% weight - Timely submission of Medical Bill Processing data via EDI


Data Timeframe used for 2022 Assessment

The data time frame used to assess performance of the insurance carriers for the above measures will be January 1, 2022, through June 30, 2022.


Selection Criteria

The insurance carriers will be selected for the 2022 PBO assessment based on their volume of initial payment of temporary income benefit transactions received by DWC during the assessment data time frame. The minimum volume of transactions will be determined based on the overall volume of the assessment data and DWC resources but will not be less than 20 initial payments.

 
Data Sources

The data sources used to assess performance of the above measures will come from the claim and medical data submitted electronically via EDI to DWC.


Tier Structure and Placement Methodology

Three regulatory tiers are used to make a distinction between poor, average, and high performers in the workers’ compensation system. The insurance carriers assessed are considered to have an impact on the workers’ compensation system due to their volume of filings. DWC is not asserting that a high volume has a negative impact on the system. Insurance carriers who are not assessed due to low volume are not absolved from regulatory duties or regulatory oversight.

DWC will conduct several steps to place each insurance carrier into an overall regulatory tier. The first step is to calculate the performance score (percentage) for each measure. Next, the performance score for each measure will be multiplied by the assigned weight value (the value is rounded up). This calculation of two percentages will then be multiplied by 100 to obtain a weighted value (the value is rounded up). The weighted value of each measure will be added together to calculate the overall score (no rounding). The overall score identifies the overall performance standard for the assessed entity. The overall performance standard is defined below.

The performance standards are:

High Tier: 95 or greater
Average Tier: 80.00 through 94.99
Poor Tier: 79.99 or less

For more information, contact: PBO@tdi.texas.gov

Last updated: 1/11/2022