legal bill review practices

Q&A: A Look at E-Billing and Legal Bill Review Practices

Looking towards the next phase

When you’ve worked on both sides of the claims litigation relationship like Allan Rotlewicz has, you’re bound to bring a unique perspective to the table. That’s precisely why CaseGlide CEO Wesley Todd sat down with Rotlewicz, a partner at Rumberger | Kirk, to discuss the limitations of traditional e-billing and bill review practices for the Litigation Management Podcast.

The common pitfalls of legal insurance e-billing is a topic we’ve covered on the CaseGlide Blog in the past, but Todd and Rotlewicz were able to delve deeper into the conversation for the podcast, which you can listen to in its entirety here.

Below are select excerpts of this conversation.

Current Challenges Facing Legal Bill Review Practices

Wesley Todd: Before I pass it off to Allan and officially welcome him and give him an opportunity to tell us about his background, I’m just going to set the stage really quick. We’re going to use the words e-billing, bill review, and automated bill review interchangeably. What we’re talking about is really two different things. E-billing is just the technology, but we may use it interchangeably with bill review or other related terms. We’re talking about the industry and software, and then the people and third parties that will review the lawyer’s bills.

Allan, welcome to the Litigation Management Podcast. I’d like you to give us a little bit about your background origin story. 

Allan Rotlewicz: Sure. Thank you very much for having me. I was an associate at Rumberger Kirk’s Miami office for over six years before I joined Anchor Insurance in St. Petersburg. I moved up to St. Petersburg in 2017 and joined Anchor Insurance as their general counsel. I spent about three and a half years with Anchor, managing their claims litigation as well as some other issues. In September of 2020, I rejoined Rumberger Kirk in Tampa as a partner. So, this is really an important topic for me. I’ve worked on both sides of it.

Wesley: You’ve been on both sides, so you understand what a corporation is going through when they get those bills in. And then you also understand the lawyer’s plight, as they’re trying to provide as good of a service as they can to the corporation. The thing we’re seeing is that e-billing and legal bill review practices aren’t really saving companies money. Have you seen that also and why do you think that is?

Allan: I think what’s most important to look at is the big picture, and as you’ve said, a holistic approach to managing the case. I think bill reviews are sometimes causing the best lawyers not to handle the files because what you end up seeing is the attorneys on the defense side are spending a lot of time dealing with how to word the billing entry or appealing billing entries as opposed to spending time litigating the file and working the file towards resolution. You end up spending a lot more time dealing with billing, as opposed to [saying], ‘Let’s shorten the life of file, let’s identify the file, let’s work the file, and let’s move it towards closure, whether it’s settlement or trial or motion for summary judgment.’ That’s really where you are going to find the best attorneys. [They are] the ones who can spend the time litigating the case, not spending time appealing billing entries. 

Wesley: You get an invoice back for first-round review, and let’s say it has 20 line-items. What’s a common scenario that can get frustrating for how many of those things are appealed? What happens next? Just put us in your shoes for a minute.

Allan: You may end up getting a bill appeal for a file that has already settled or for work that was being done two, three, four months ago. The appeal is going to require you to locate the document or locate the email. Sometimes [with] the tasks, it’s ‘Did you have client approvals?’ Now you’re going back in and looking for that email around the day of the billing entry that approves something, or it’s ‘Please attach a copy of the discovery response.’ So, you’re going into the file, you’re attaching them, you’re explaining how long it took you to prepare that document and how many pages that document is. Sometimes you’re going through the claim file, especially in first-party property, to say these were the specific documents I looked at or these are the documents that were redacted.

The defense firm will appeal it, and if that appeal is being sent to someone other than the client, you’ll get a response back from the bill review entity. Then, if the defense firm needs to escalate it from there, now they’re escalating it to the client. Somebody at the insurance company now has to spend time reviewing it potentially for a second and third time to figure out what happened. It’s not just the potential increased costs for the insurance company, but it’s also the usage of employees at the insurance company that may be spending time that can be better used somewhere else. 

Wesley: In a percentage of cases, the software comes with a third-party bill review. They review it, but it still winds up in the hands of the claims organization a lot of times anyway. So, where’s the efficiency?

Allan: Yeah, it comes back to the client at the end because the defense firm is going to reach out and say, ‘This got audited, we appealed it, we were unsuccessful, this is why this happened. I had a conversation with the client, had a conversation with the litigation examiner who was on board for the strategy,’ and it normally will get resolved. I’m happy to say that I think most law firms have good relationships with their clients that they can resolve these issues, but both sides end up spending a lot of time making sure that they both are happy with the end result of a bill review. 

Wesley: Are you seeing what we’re seeing, which is a lot of these companies are noticing that their legal spend keeps going up every year? Their settlement amounts are going up, their cycle times are going up, yet the provider is telling them they’re saving 6 or 8% on their invoices or something like that.

Allan: I think so. If you only look at the defense spend in a vacuum, you’re really not looking at the entire file. To me, the big picture is really three factors. It’s the life of the file, how long from the day we got it until the day we were able to resolve it, whether that’s a settlement or a motion for summary judgment or a trial. While we don’t have control over all of those things, a lot of cases are going to settle, so let’s spend the time early to evaluate the case. That’s why when you look at defense spend in a vacuum, it doesn’t give you that picture. If a good lawyer spends extra time in the beginning, you really know the file and [know] this is a settlement candidate, or this is a trial candidate for some sort of dispositive motion. That next number, the indemnity number, the settlement number is likely and should be lower. You want to look at, in my opinion, those three factors: Life of file, defense costs and the settlement. When you’re talking just about the monetary spend, if you combined the defense cost and the settlement, that’s the more important number when you’re comparing your lawyers. A great lawyer may spend more time on the file that may get you better results. You may have someone spend less on defense costs, but if you’re settling the cases for more, that’s not a cost savings. That’s where having a bill review company telling me I can save you 6 to 8% on defense costs, it doesn’t give me that truly holistic number in all the data I would need as a carrier to make the best decision. 

It’s important to have [good data] maintained in a place where you can find it and you can have that at your fingertips. And when you separate resources for claims management and defense costs, you may not have that at your fingertips. One of the things I always enjoyed with CaseGlide was I can quickly put a finger on all those data fields, defense costs, settlement costs and life of file. You look at that and you figure out who’s giving you the best results, and you’re less worried about bill reviews.

Billing guidelines are important. I think it’s important to have those with your defense firm, but the relationship that you’re going to build between a client and a law firm is important. If they’re giving you great results and they’re really working with you, I think that’s what’s so important. It’s both the carrier and the law firm that needs to work together.

The Big Picture Shift on E-Billing and Legal Bill Review Practices

Wesley: With regard to e-billing and legal bill review practices, why are we using technology to look at things that have already happened when you could use technology to tell you what we should do next and avoid it altogether?

Allan: We ask for what’s important in knowing the file and making a decision early on, and that goes back to a great lawyer may spend more time in the beginning, digging through the claim file, digging through the records to understand what’s being presented to them. And the same way a sophisticated client is going to say, ‘Okay, now that you’ve told us, this is a settlement candidate, how do we get the best possible settlement?’ In Florida, having a fee statute, maybe that’s getting an early demand. Maybe that is limiting discovery. Maybe that is delaying our response to the complaint. But by knowing the file, by being able to have a conversation with the client, with the litigation examiner and saying, ‘Look, this is settlement candidate. What are your thoughts on delaying discovery or not responding to the complaint?’ 

They’re getting an extension of the time needed for having a settlement conversation and getting a desk review if they need to. For damages, what’s the best possible way? You have that conversation so that you’re not worried about discovery demands that took a 0.5 instead of a 0.2. Instead, you built a strategy to really resolve the case. On the flip side, you review a file, and you say, ‘You know what? I see a summary judgment motion here. I see a trial candidate. What do we need to do to get it there quickly with the best possible defenses?’ Let’s set depositions, and this is the order that we’re going to depose people. Let’s get out of discovery, let’s ask specific questions. In that case, discovery demands may be very case-specific and may appear on a bill to have cost a little bit more than another case, but everybody knows why that was. 

Everyone’s had that conversation that the law firm and the client had early on to say, ‘We are going to serve very specific discovery to figure out this issue and flush this out. We’re going to subpoena these records. We’re going to take the deposition of these three or four individuals because that’s what’s going to give us the best possible defense.’ You’ve built that plan. In the first point of your 30 days, you have a plan in place. No one’s surprised when they see a bill 45 days later that these tasks were done. That’s really what I think is important and how you can handle that if you’re working together and you have great communication.

Wesley: E-billing by itself, electronic billing and digital bills and digital invoice, and line items, and the validations you can run on that, and the reports you can run on that are extremely valuable—but it is not leading to wins. It’s leading to losses. At least that’s what we’re seeing as we convert customers over from that. I think that you brought a really good perspective. You’re fair and balanced on both sides. That was the goal for today, to try to give a fair report. I think that we did that.

Allan: It was, thank you very much for having me.

Please note that the questions and answers you read here have been edited for both length and clarity. For the conversation in its entirety, we encourage you to listen to Ep6: The Next Phase of Legal Bill Review from the podcast.

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