Life Care Plan Methodology, the Price is Right, or is it?

Estimating an evaluee’s likely future medical needs can often be a complex exercise with many potential gray areas. For example, how certain is the treating physician that the patient will absolutely require a given treatment? How long will the treatment last? What happens if the treatment is successful, or unsuccessful? Does the plan change?  May future complications arise? Thankfully, as certified life care planners, we have generally accepted practice guidelines and a rich body of literature to guide us through some of these difficult conditions.
One area of life care planning or future medical costs deals with the appropriate price to incorporate into a plan. The most common method is to conduct a survey of medical providers, durable equipment distributors, pharmacies, surgery centers, etc, and ask for the “billed price” the patient would be expected to cover should they independently seek the services without the benefit of any discount. Data points should be collected from a range of sources (usually a minimum of three costs when appropriate and available). Our policy is to present the results of this cost research in a range to account for differences in the market. Offsets for discounts provided through contracted insurance pricing are inappropriate due to collateral sources limitations, and consideration for discounted pricing or other alternative methods are too speculative to reach the necessary legal standards. In addition, discounts are far too variable, subject to change or discontinuation to be considered reliable.
Some life care planners have espoused using published fee schedules to determine likely costs of future medical care. The Physician’s Fee Reference (PFR; Wasserman, 2018) is a popular resource cited by some life care planners. The PFR is a compendium of aggregated charges from a number of sources (third party payors, clearinghouses, practice management system vendors, billing services, universities, medical practices, hospitals, and the Centers for Medicare and Medicaid Services). The stated purpose of the PFR is to provide fee strategies for physicians to set and adjust fees. It contains listings of codes, descriptions, and fees at the 50th, 75th, and 90th percentiles.
Instead of independently surveying medical vendors in a patient’s geographical area, some life care planners cite the Usual, Customary, and Reasonable (UCR) fee. Although this may be more time efficient, we believe it provides an inaccurate assessment of likely actual future medical costs. Primarily, using the PFR as a proxy for a geographical cost survey is inconsistent with its stated purpose of helping to set physician fees. Secondly, by reporting only the 50th percentile and higher costs, the PFR leaves out the lower half of the cost estimates, which artificially skews the pricing. Additionally, geographical specificity within the PFR is determined by using geographic multipliers which are derived in part from the Medicare Physician’s Fee Schedule. Even the PFR’s publishers describe the geographic multipliers as “imprecise,” yet claim they are the best available measurement of relative differences between geographical areas.
At Stokes & Associates we take great care to ensure that we are using best practices when it comes to our assessment methodologies, and for that reason, we advocate against relying on published fee schedules for general life care planning. Using published fee schedules does not give the complete picture and therefore distorts the information presented to the trier of fact, rending the information invalid and unreliable. There are of course exceptions to every rule.
To find out more about our methods or to discuss a potential case assignment, we offer complimentary consultations concerning "hypothetical matters." 

To strategize with one of our vocational experts or life care plan experts at Stokes & Associates please call David Barrett at 504-454-5009, visit our website, or email

Larry S. Stokes, Ph.D.
Aaron Wolfson, Ph.D.
Lacy Sapp, MHS, CRC, LPC, LRC, CLCP 
Todd Capielano, M.Ed., LRC, CRC, LPC, CLCP