How a clinical re-read turned a $147K MSA into $47K, and what the original review missed

“Holy moly, 100 grand. This is as much the claims handling process as anything.”

Risk Manager, Fortune 500 services contractor (self-insured WC program)

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An industry POV for Risk Managers, Directors of Risk Management, and Workers’ Compensation Program leaders at self-insured employers.

By Nathan Gunn, MD, CEO and Co-Founder, SecondLook Health

May 26, 2026

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THE SHORT ANSWER

A self-insured employer recently received an MSA allocation projecting $147,310 in lifetime for future medical costs. A clinical re-read brought the same allocation in at $47,310. For a Risk Manager looking at a self-insured workers’ compensation book, the question is how a $100,000 swing on a single MSA is possible, where the gap lives, and what role AI plays in closing it. The answer is that MSA accuracy depends on a causation analysis the typical cost-projection workflow doesn’t perform, the analysis isn’t practical to do on every MSA without a physician-led clinical intelligence platform, and SecondLook Health is that platform. The consultant makes the call. The platform makes it possible for her to make that call on every MSA in your book, not just one.

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THE STORY

A $147K MSA came down to $47K once a credentialed reviewer engaged the causation question

The employer is a Fortune 500 services contractor with a self-insured high-deductible workers’ compensation program. Late in 2025 the employer’s risk leadership engaged SecondLook Health to re-read an MSA allocation prepared by their existing MSA vendor through their TPA. The original allocation came in at a projected $147,310.

The claimant was a 62-year-old male injured in a severe rear-end motor vehicle collision while on duty. Post-MVA imaging showed no acute spinal injuries: CT and X-ray returned no acute changes, and the only documented injuries were a closed head injury and a right elbow sprain. Three months later, an MRI documented multilevel degenerative spine disease with the most severe findings at L4-L5: spondylolisthesis, severe bilateral foraminal stenosis, and Modic type I changes consistent with chronic inflammatory endplate disease. The MRI also documented congenital transitional anatomy at the L5-S1 junction, a lifelong anomaly that accelerates degeneration at the adjacent L4-L5 level over years. The treating spine specialist eventually recommended an L4-L5 interbody fusion with posterior screw fixation. The original MSA included that fusion, plus post-operative rehabilitation, as a future MVA-related medical cost. That recommendation is where the original allocation stopped asking questions, and where the re-read started. 

Leta Sharkey-Laugle, MS, NCC, CRP, CLCP, MSCC, of Medical Settlement Advantage Expert Inc., reviewed the same medical record using SecondLook’s clinical intelligence platform. Her revised allocation, prepared under SecondLook in tech-enabled services mode, came in at $47,310. The fusion and subsequent rehab were not included.

“Many MSA vendors would add in a spinal fusion and subsequent rehab because the doctor said so. But if you read the doctor’s reports, he doesn’t relate it causally. Even his diagnosis doesn’t attribute it to the injury. His diagnosis says spondylosis. The literature is real clear: post-traumatic fusion requires a spinal fracture, neural compression after fracture, or progressive significant acute neurological impairment. None of those apply here.” - Leta Sharkey-Laugle, MS, NCC, CRP, CLCP, MSCC, Medical Settlement Advantage Expert Inc.

Leta’s read of the record isn’t exotic. It’s what a credentialed reviewer does when the workflow actually asks the causation question. The reason it doesn’t happen on most MSAs is structural.

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Standard MSA vendors price what the doctor recommended, not what the injury caused

MSA preparation today is dominated by cost projection. The vendor pulls the medical record, identifies the documented treatment plan, and prices it forward using fee schedules, life expectancy tables, and pharmacy projections. The methodology is well established and the math is accurate. What sits upstream of this math is more important.

When the medical record contains a documented future treatment recommendation, the MSA vendor has to decide whether to include it. The default is to include what the treating physician recommended. The vendor’s downside risk for under-allocating, and getting flagged by CMS, feels larger than the cost of over-allocating, even when the over-allocation runs into six figures and the employer pays.

The vendor isn’t equipped to do the prior analysis. They aren’t the credentialed clinician who would interrogate causation. They don’t have the time or the literature access to ask whether the documented future treatment is actually attributable to the compensable injury. So, they price what the doctor recommended, the number lands approximately at $147,310, and the employer pays it.

Even when an employer recognizes the gap, the standard alternative is to retain a credentialed clinician to read the chart manually. A complex multi-provider record review cost tens-of-thousands of dollars per case. That cost is hard to justify on every MSA, so the work happens on the ones that get flagged and not on the ones that don’t. Six-figures over-allocations on unflagged cases keep getting paid.

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AI did not determine the benefits in this workflow. Credentialed humans did

The dollar number above will read to some people as a benefits determination made by an AI. It wasn’t. The consultant made the call. The platform made it possible for her to make that call in days rather than weeks, with depth and consistency a consultant working alone cannot match.

Three things make the SecondLook platform different from a generic chart reader or a literature search wrapper, and all three were active on this case.

1. First, the platform reasons across the full longitudinal record, every provider, every encounter, every imaging report, at a depth and speed a clinician working with PDFs and a highlighter cannot achieve. On this case, the platform built a structured clinical timeline from the medical record with every diagnosis, treatment, and finding linked to its source document. It surfaced the spondylosis ICD codes documented at multiple encounters, none of which attributed the lumbar condition to the MVA. A clinician with two weeks and a stack of records might find the same pattern. A clinician within two days could not be able to.
2. Second, the platform forces the causation question as a routine workflow step on every documented future treatment recommendation. Standard MSA workflows accept what the treating physician recommended. SecondLookth’s workflow surfaces the overlap between any recommended future treatment and any documented pre-existing or comorbid finding and presents that overlap to the credentialed clinician for review. On this case, the platform flagged the overlap between the recommended lumbar fusion and the multilevel degenerative findings with the congenital transitional anatomy at L5-S1. The clinician didn’t have to think to ask the question. The platform asked it for her.
3. Third, the literature retrieval is built on physician-led clinical research methodology, not a generic search wrapper. When Leta asked the platform about causation in MVA-related disc injury, it returned the relevant biomechanical literature, the published rate of acute disc injury attributable to motor vehicle collisions, the North American Spine Society guideline distinguishing degenerative from traumatic spondylolisthesis, and the VA Community Care fusion indications, with citations to primary sources. The platform knew which clinical question was relevant to this case because the underlying methodology was built by physicians who know what questions matter on a lumbar fusion in a 62-year-old with pre-existing degenerative findings. A literature search tool with no clinical methodology behind it would have returned a different and less useful set of results.

On this case, the platform did all of the above. It did not decide whether the fusion was compensable. It did not include or exclude items from the MSA. It did not communicate with CMS, and it did not sign anything. The benefits determination came from a chain of credentialed humans. To guarantee CMS approval of the MSA without surgery, the treating physician would need to agree in writing with his own diagnosis of spondylosis (pre-existing), the current literature evidencing that the MVA did not cause  the need for any future surgery and the recommendation for future surgery is related to continued spinal degeneration and not the MVA.   The medical literature is clear as are the claimant’s medical records and diagnosis.

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The same pattern shows up across any self-insured book with comorbid claimants

A $100,000 on one MSA is meaningful for a self-insured employer. The bigger number is what happens when the same pattern shows up across a book of business.

Medical costs dominate workers’ compensation losses on the high-severity claims that drive MSA work. According to the National Council on Compensation Insurance, medical costs account for roughly 60% of total losses on claims in the $2M to $3M range, roughly 70% on claims in the $3M to $4M range, roughly 80% on claims in the $4M to $5M range, and roughly 90% on claims of $5M or more. ^¹ These are exactly the claims that fall under Medicare’s WCMSA review threshold.

The Centers for Medicare and Medicaid Services issued 14,862 WCMSA determinations in fiscal year 2024, with an average proposed allocation of approximately $70,887. ^² If the structural pattern described above runs across even a small share of those allocations, the dollar exposure for self-insured employers across the system is significant.

The clinical question driving the case above is also well covered in the literature. Acute disc injury attributable to motor vehicle collisions runs at about 0.01 per 10,000 exposed occupants, and accepted biomechanical principles describe disc herniations as fatigue injuries from cyclic loading over years rather than acute trauma. ^³ The North American Spine Society guideline on degenerative lumbar spondylolisthesis explicitly distinguishes degenerative from traumatic spondylolisthesis, and the AHRQ systematic review confirms that traumatic spondylolisthesis is excluded from degenerative spine disease classifications and requires separate causation analysis. ^⁴⁻⁵

Every MSA in your book where a documented treatment recommendation overlaps with a degenerative finding sits at the intersection of these facts. A self-insured employer with five to ten MSAs running through their program in a year is exposed to a number that adds up fast.

“Oh, my God. I never realized I had influence on this. Before, I was always like, well, they just do it. I have a vendor, they know what they’re doing. And holy moly, 100 grand. This is as much the claims handling process as anything.” - Risk Manager, Fortune 500 services contractor (self-insured WC program)

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Four signals predict the same delta on an MSA in your book today

• MSAs that include a major elective surgery in a claimant with documented pre-existing degenerative imaging findings. Lumbar fusion, cervical fusion, total knee replacement, and shoulder arthroplasty are the highest-frequency contributors to inflated MSAs because the surgical recommendation often overlaps with a chronic degenerative process.

• MSAs where post-injury imaging showed no acute findings but later imaging documented degenerative changes. Modic changes, multi-level disc disease, and facet arthropathy develop over years. If the acute imaging was clean, the chronic findings aren’t from the workplace event.

• MSAs where the treating physician’s diagnosis ICD codes don’t attribute the condition to the workplace event. A diagnosis of spondylosis without myelopathy or radiculopathy is a degenerative diagnosis. A diagnosis of spinal sprain or strain related to the work injury is different. The diagnosis codes in the record will tell you which one is documented.

• MSAs prepared more than twelve months ago. The peer-reviewed literature on biomechanics and degenerative versus traumatic causation is current and citable. Older allocations were prepared before this evidence was readily accessible at the point of MSA work.

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Self-insured employers can engage SecondLook in platform mode or tech-enabled services mode

SecondLook delivers clinical intelligence in two modes, and MSA work is a clean example of both.

• Platform mode. MSA professionals, including credentialed MSCCs, CLCPs, and CMSPs, use the SecondLook platform directly to support their own signed allocation. Professional liability stays with them. The platform compresses what would be 40 to 80 hours of chart review into a few days of focused clinical reasoning, which makes thorough re-reads economically practical on every MSA in their book.

• Tech-enabled services mode. Self-insured employers who want to direct an MSA to SecondLook rather than to their existing MSA vendor can do that. SecondLook engages a credentialed MSA professional to do the clinical reasoning, the treating physician attests to causation, and the MSA report is signed by the credentialed MSCC. SecondLook coordinates the workflow. This is the mode the employer used in the case described above.

Both modes use the same physician-led clinical intelligence platform underneath. The difference is who runs the workflow and who signs the deliverable, which is a question of employer capacity and preference.

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MSA accuracy is a clinical reasoning problem dressed up as a cost-projection problem

The dollar gap between an MSA that engages the causation question and one that defaults to including what the doctor recommended is large enough to show up on a single case and reproducible enough to show up across a book. The structural fix is to put a credentialed clinical reviewer, supported by a physician-led clinical intelligence platform that makes the work feasible at scale, into the workflow before the math gets done.

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Next steps for self-insured WC programs

• ‍Pull one open MSA from your book that matches the four signals above and book a 15-minute strategy conversation. SecondLook will identify documented future treatment recommendations, examine the causation chain in the medical record, and return the current peer-reviewed literature on any contested allocation.
• Audit MSAs in your book prepared more than twelve months ago for documented surgical recommendations in claimants with pre-existing degenerative findings. This is the highest-yield subset for a re-read.
• If you advise self-insured employer clients as a risk consultant or benefits consultant, request a client-facing checklist for evaluating clinical AI in workers’ compensation by emailing support@secondlookhealth.ai.

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Sources

1. National Council on Compensation Insurance. 2025 State of the Line Guide. Medical share of losses by claim severity threshold, Accident Years 2004 to 2024. https://www.ncci.com/SecureDocuments/SOLGuide_2025.html

2. Centers for Medicare and Medicaid Services. Workers’ Compensation Medicare Set-Aside (WCMSA) Fiscal Year Statistics: 2020 to 2024. Published November 2024. FY 2024 figures: 14,862 determinations, average proposed WCMSA $70,887. https://www.cms.gov/medicare/coordination-benefits-recovery/workers-comp-set-aside-arrangements

3. Kent R, Cormier J, McMurry TL, Ivarsson BJ, Funk J, Hartka T, Sochor M. Spinal injury rates and specific causation in motor vehicle collisions. Accident Analysis and Prevention. 2023 Jun;186:107047. doi:10.1016/j.aap.2023.107047. PMID: 37003164. https://pubmed.ncbi.nlm.nih.gov/37003164/

4. North American Spine Society. Clinical Guidelines for Diagnosis and Treatment of Degenerative Lumbar Spondylolisthesis. Definition excludes traumatic spondylolisthesis. https://www.spine.org

5. Agency for Healthcare Research and Quality (AHRQ). Systematic review distinguishing degenerative from traumatic spine disease classifications. https://www.ahrq.gov

6. U.S. Department of Veterans Affairs, Office of Community Care. Clinical Determinations and Indications: Spinal Fusion Surgery (IVC-CDI-00054). Criteria distinguishing degenerative from post-traumatic indications for lumbar fusion. https://www.va.gov/COMMUNITYCARE/docs/providers/CDI/IVC-CDI-00054.pdf

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Related

The Untapped AI Opportunity in Workers’ Compensation

The Clinical Advantage

About SecondLook Health

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