Maine Workers’ Compensation Medical Fee Schedule Maine Workers’ Compensation Board Office of Medical/Rehabilitation Services Presentation to the Maine Chapter of the Healthcare Financial Management Association November 15, 2012

Fish or cut bait. (American) something that you say to someone when you want them to make a decision and take action without any more delay

NCCI State Advisory Forum 10/20/11 OVERVIEW Claim frequency continues to decline but appears to be leveling off. Medical benefits constitute the majority of total benefit costs in Maine. © Copyright National Council on Compensation Insurance, Inc. All rights reserved.

WCRI “States with fee schedule regulations that were based on percent of charges had higher costs compared to states with other types of fee schedules.” “As costs for workers’ compensation medical care continue to increase rapidly, the pressure on policymakers and other stakeholders to contain those medical costs also continues to increase.”

125 th Maine State Legislature An Act Regarding Payment of Medical Fees in the Workers’ Compensation System Stated Goal: “…to ensure appropriate limitations on the cost of health care services while maintaining broad access for employees to health care providers in the State…”

125 th Maine State Legislature The Board shall adopt rules that establish a medical fee schedule setting the fees for medical and ancillary services and products rendered by individual health care practitioners and health care facilities.

125 th Maine State Legislature The Board shall adopt rules that establish a fee schedule or other standards of reimbursement for providers regarding administrative, case management, medical and legal and other activities unique to the treatment of injured workers in the workers' compensation system.

125 th Maine State Legislature L.D signed into Public Law on June 14, 2011 by Governor LePage. P.L. 2011, c. 338 repealed and replaced the Medical Fees; Reimbursement Levels section of the Workers’ Compensation Act.

125 th Maine State Legislature The Board was tasked with adopting rules that establish medical fee schedules by December 31, On November 8, 2011, the Board voted to adopt rules in accordance with the law.

Board Rule Chapter 5 The current iteration of the medical fee rule became effective on December 11, The National Council on Compensation Insurance, Inc. (NCCI) anticipates that the new rules will generate significant savings with respect to medical costs.

Board Rule Chapter 5 Underlying Methodology Federal Centers for Medicare and Medicaid Services: Procedure Codes Relative Weights/Values Conversion Factors or Base Rates

Required Updates The Act now requires two types of medical fee schedule updates: Annual updates done by the Executive Director of the Board Periodic updates undertaken by the Board

Workers’ Compensation Boards? Independent Board of Directors composed of seven members appointed by the Governor: 3 Representatives of management Chamber of Commerce and Industry 3 Representatives of labor AFL-CIO Chair (Executive Director) Executive Director 9 Hearing officers General Counsel Deputy Director of Business Services Deputy Director of Information Services Deputy Director of Medical/Rehabilitation Services Senior Staff Attorney Worker Advocate Division

Annual Updates Notwithstanding Title 5, Chapter 375, Subchapter 2, the Executive Director of the Board shall annually update the medical fee schedule. Must be complete by December 31 st of each year.

Annual Updates The medical fee schedule must be consistent with the most current medical coding and billing systems: RBRVS MSDRG APC HCPCS ICD CPT

Annual Updates The exemption from rulemaking for the annual updates is premised on two grounds: Ministerial nature of updates Inability to meet annual update timeline if rulemaking undertaken

Fallback Provision If the Executive Director fails to annually update the medical fee schedule, the reimbursement rate for medical services is 105% of the private 3 rd -party payor average payment rate for the provider or the amount agreed to in writing prior to the rendering of service. Fallback provision is NOT A VIABLE OPTION!

Periodic Updates The Board shall undertake a comprehensive review of the medical fee schedule once every 3 years beginning in These periodic updates are subject to the rulemaking requirements of the APA.

Rulemaking Process Annual Regulatory Agenda Board drafts rules Governor’s office for pre-approval Attorney General’s office for legal pre-review Public Hearing Oral testimony Written testimony

Rulemaking Process continued… Board takes final action Governor’s office for post-approval (only if amended) Attorney General’s office for legal post- review Filing with the Secretary of State Effective date

Periodic Updates The Board shall consider the following factors: The private 3rd-party payor average payment rates obtained from the Maine Health Data Organization; Any material administrative burden imposed on providers by the nature of the workers' compensation system; and The goal of maintaining broad access for employees to all individual health care practitioners and health care facilities in the State.

Information Needed: Workers’ compensation payments compared to private 3rd-party payor average payment rates: Average total payments, including professional, facility, ancillary and patient cost-sharing contribution for the medical and ancillary services and products most commonly rendered during the immediately preceding calendar year.

Information Needed: Material administrative burdens? M-1 and other narrative reports Depositions Medical records Billing for professional services directly Implants “Orphaned” medical bills Other

Information Needed: Average age of workers’ compensation payments: Statute – Section within 30 days after the carrier has received notice of nonpayment by certified mail Rules and Regulations – Section 1.04 usual and customary charge or the maximum allowable payment under this Medical Fee Schedule, whichever is less, within 30 days of receipt of a properly coded bill

Fish or Cut Bait. Get Involved: Legislation Rulemaking Board Meetings Etc.