Managed Physical Medicine

Q1 2017 Legislative Updates

Here is a summary of legislative and regulatory developments and challenges for the first quarter of 2017 and their practical implications:

California

For medical services provided after January 1, 2017, a new statute time-bars provider bills that are not received within twelve months of the date of service or hospital discharge.  Previously, California did not have a “timely bill submission” requirement.

  • Implications: By establishing a very generous statutory definition of timely bill submission, Labor Code §4603.2(b)(1)(B) places in question payers’ internal payment policies and their contractual agreements with providers and networks.  The Division of Workers’ Compensation is authorized by the law to adopt rules implement the twelve-month limit, including reasonable exceptions. The rule might possibly clarify whether the regulatory standard supersedes shorter private arrangements.
Massachusetts

The Department of Industrial Accidents has revised the regulation governing WC Utilization Review.  UR procedures are affected in several ways:

  1. Deletes requirement that the UR Agent submit an application to Office of Health Policy (OHP) for each site where MA UR will be conducted.
  2. Requires that Determination Letters should specify the recommendation that is included in the guideline.
  3. Updates the timeframe for retro appeals to 20 business days. Requires URAs to respond to a violation notice and request a hearing within 14 calendar days instead of 20 calendar days.
  • Implications: The DIA’s Office of Health Policy vigorously regulates Massachusetts UR, which has detailed and unique requirements.  Payers conducting or using UR for Massachusetts claim would do well to review the revised version of 452 CMR 6.00.
Virginia

As expected, the Virginia Workers’ Compensation Commission published a draft of the proposed Virginia fee schedule, which is due to be implemented in January 2018.  The draft follows the legislative mandate establishing a fee schedule structure based on six regional “Medical Communities,” with biennial revisions that protect providers against material reductions in fee schedule rates.

  • Implications: Although the Commission has issued several disclaimers that the fee schedule is only a draft and not final, it’s likely that the consultant’s recommendations will closely resemble the final schedule.  A review of the proposed Radiology, Physical Medicine & Rehabilitation and Osteopathic and Chiropractic Services rates in the appendices suggests that the new Virginia fee schedule will resemble the Illinois fee schedule:  there will be significant fee reductions from the current Usual & Customary rate structure, but Virginia WC medical costs will continue to be high relative to other states.