Managed Physical Medicine

Q2 2018 Legislative Updates

Here is a summary of legislative and regulatory developments and challenges for the second quarter of 2018 and their practical implications:

New York

In early June the NY Workers’ Compensation Board announced a proposed regulation that would increase the New York medical fee schedule for the first time in 20 years. The WCB projected an overall increase of five percent but gave no details then on how individual provider specialties would be affected.

Very recently, the WCB has published draft regional conversion factors and individual CPT relative values.  MedRisk has analyzed those proposed rates, which, if adopted, would increase PT/OT fee schedule rates by 24% to 30% and chiropractic treatment fee schedule rates by 24% to 43%, depending on the applicable region.

  • Implications:

Because the NY fee schedule is very low compared to other states and to estimates of providers’ cost of care expenses, most stakeholders have supported this proposed increase as a means of increasing injured workers’ access to health care. If adopted, the increase will be effective for all dates of service after October 1, 2018.

There has been a great deal of legislative and regulatory activity mandating providers’ submission and payers’ and their agents’ receipt of electronic bills. Among the jurisdictions addressing this issue are the following:

Virginia

Implementing the statute discussed in the Legislative Update for First Quarter, 2018, the Virginia Workers’ Compensation Commission has published draft regulations that mandate providers to submit bills electronically, with certain exceptions for small and low-volume providers. If finally adopted, the rule takes effect December 31, 2018, and applies to all bills with dates of service after that date.

Payers are given only two days to reject bills submitted electronically in the mandated uniform format. Payers must pay uncontested portions of electronically submitted bills within 60 calendar days or must automatically include in late payments interest at Virginia’s standard annual judgment rate of interest, currently six percent.

Tennessee

The Tennessee Bureau of Workers’ Compensation has adopted a similar regulation, effective for dates of service beginning July 15, 2018, with two principal differences. First, the Bureau is empowered to grant exceptions to individual providers from this electronic bill submission mandate, and payers are exempt from the electronic bill receipt process for low-volume providers.

Second, the payer has only 15 days to accept or reject electronic and must pay all uncontested portions of the bill within that 15-day period. Late payments accrue an interest rate of 2.08% per month (25% annually).

New Jersey

The New Jersey Department of Labor and Workforce Development has adopted final rules, implementing a 2016 statute, which mandate providers’ submission and payers’ receipt of electronic bills. There are exceptions for low-volume providers. Payers are given 60 days to pay uncontested bills, but there are no provisions in the regulation for late-payment interest or penalties. This is a new regulation and does not have an effective date shown.

Illinois

The Illinois General Assembly has passed and sent to Governor Rauner for signature a bill that empowers the Department of Insurance to establish rules to ensure that all providers submit bills electronically and require all payers to receive them electronically, with reasonable exceptions. If the bill is enacted, the DOI will use its discretion in drafting regulations consistent with this broad direction.

  • Implications:

These electronic bill measures represent a multi-year and widespread initiative to mandate electronic bill submission and payment for all but a limited number of providers and payers. Although most commercial payers have technology in place to receive provider bills, the statutes and regulations mandating rapid rejection or acceptance and payment will challenge the payer community operationally.