Workers' Compensation Fee Schedules, Maximum …

1 WORKERS' Compensation FEE SCHEDULES, Maximum allowable FEES, AND COMPARATIVE REIMBURSEMENTSDEAN SUGANOR esearcherReport No. 5, 2007 Legislative Reference BureauState CapitolHonolulu, Hawaii 96813 report has been cataloged as follows:Sugano, DeanWorkers' Compensation fee schedules, Maximum allowable fees,and comparative reimbursements. Honolulu, HI: Legislative Reference Bureau, December Workers' Compensation Law and legislation United States States. A25 07-5iiiFOREWORDThis report was written in response to Senate Concurrent Resolution No. 77, 1, adopted by the Legislature during the Regular Session of 2006. The concurrent resolution requests the Bureau to study reimbursements under the workers' Compensation fee schedules. The Bureau wishes to acknowledge the invaluable assistance and cooperation of the medical doctors and osteopathic physicians who responded to the Bureau's reimbursement survey, the Disability Compensation Division of the Department of Labor and Industrial Relations, the First Insurance Company of Hawaii, Ltd.

2 , the Hawaii Employers' Mutual Insurance Company, IMS, a Solera Company,the Hawaii Medical Association, and the San Francisco office of the Centers for Medicare and Medicaid H. TakayamaActing DirectorDecember 2007ivTABLE OF Request of the Scope of the Layout of the schedule allowable Fee = Relative Value Units Conversion Medicare Resource-Based Relative Value Scale in Workers' Medicare Resource-Based Relative Value Scale, Geographically Medicare Payment Formula in Workers' General Medicare Payment Actual Medicare Payment Actual Medicare Payment Formula, for Use in Workers' Relative Value Units for Practice Expense Under the Medicare Resource-Based Relative Value Participating Physician's Rate of Payment Under SCHEDULES AND REIMBURSEMENT METHODSOF THE SEVERAL Without Fee with Fee Schedules Whose Bases are Not Expressly with Fee Schedules Based on with Fee Schedules Whose Source of Relative Values is theIngenix Publication.

3 Relative Values for with Fee Schedules Whose Source of Relative Values is theMedicare Resource-Based Relative Value with Fee Schedules Whose Payment Formula is a Percentage ofthe Medicare Payment Table of Reimbursement Methodology and Fee schedule FEE SCHEDULES AMONG THE SEVERAL that Lack Statutes or Administrative Rules Regarding the Adjusting of Their Fee with Fee Schedules Subject to Discretionary with Fee Schedules Subject to Mandatory Adjusting, but Without a Specified Basis for with Fee Schedules Subject to Mandatory Adjusting, with a Specified Basis for Table of Reimbursement Methodology and Fee schedule allowable FEES AMONG THE SEVERAL STATES FOR SERVICES RENDERED IN A NON-FACILITY Five CPT Codes for or Trends between Fee Schedules and Fee 'S TWO WORKERS' Compensation FEE Two Fee Schedules Under Hawaii's Workers' Compensation Legislative Intent of Act 234 with Regards to the Fee the Governing Fee schedule for a Procedure or Charge-Based Supplemental Fee the Maximum allowable Fee for a Procedure orService Under the Supplemental Fee Resource-Based Medicare Fee the Maximum allowable Fee for a Procedure orService Under the 110% Medicare Fee Next Chapter.

4 A allowable FEES AND COMPARATIVEREIMBURSEMENTS IN HAWAII FOR SERVICES RENDEREDIN A NON-FACILITY Survey CPT Codes Reported, Including the Five Most Frequently Supplemental Fee schedule as the Primary Fee Shift from 110 Per Cent Medicare Fee schedule to the Supplemental Fee schedule as the Primary Fee allowable Fees Under the Fee Actual Reimbursements Under the Fee of Reimbursements from Workers' Compensation with Reimbursements Under Employee Group Health of Reimbursements from Workers' Compensation with Reimbursements from the Uninsured Legislative Intent of Act 234 with Regard to the Governing Fee schedule and Actual Reimbursement Figures from Workers' Compensation and Employee Group Health Care to No. 77, 1 (2007)..62 The Table of Data Relating to the Provider Reimbursement FROM THE DOCTORS AND from the Doctors and on the Fee schedule and Workers' Note on CPT Code on Payments by Individual Comments of the Doctors and Concurrent Resolution No.

5 77, 1, Twenty-third Legislature,Regular Session of ' Workers' Compensation Medical Fee Reimbursement Methods:Language from Statutes, Administrative Rules, and Fee Of Reimbursement Under The Workers' CompensationMedical Fee Methodology and Fee schedule allowable Fees of Five Most Frequently Reported Non-Facility Maximum allowable Fees (in Dollars) in 2007 for CPT Codes 99203, 99204, 99212, 99213, and of Codes and Report Five Most Frequently Reported Primary Fee schedule Over the Years with Regard to the Maximum allowable Feesfor the CPT Codes Reported in Our Relating to the Provider Reimbursement Fee schedule and Workers' Fee schedule and Workers' many fee schedules are there in Hawaii for workers' Compensation ? One is the 110% Medicare fee schedule , which sets Maximum charges at 110% of the Medicare payment amounts applicable to Hawaii.

6 The other is the supplemental fee schedule , which by law sets Maximum charges at the "prevalent charge for fees for services actually received by providers of health care services to cover charges for that treatment, accommodation, product, or service." they work in conjunction with each other? , charges shall not exceed the greater of the prevalent charge set under the supplemental fee schedule or 110% of the charges allowed under does that work out in practice? Maximum allowable fees for a medical service are listed under both the supplemental fee schedule and the Medicare fee schedule , thenthe Maximum allowable fee is determined by the supplemental fee schedule . If Maximum allowable fees for a medical service are listed only under the Medicare fee schedule , then the Maximum allowable fee is determined by the 110% Medicare fee schedule .

7 If Maximum allowable fees for a medical service are not listed under either schedule , then the Maximum allowable fee is the provider's lowest fee received for thatmedical service when rendered to private services are identified by their Current Procedural Terminology, or CPT, schedule is the primary one? supplemental schedule governs the Maximum allowable fees of over a majority of the CPT codes that were reported in our survey of most frequently used high are the Maximum allowable fees under the supplemental fee schedule ? the CPT codes reported in the survey, the supplemental schedule sets Maximum allowable fees at about 136% of Medicare are the most frequently used services in workers' Compensation ?

8 Upon our survey, the evaluation and management services were the most frequently reported services. Specifically, the five most frequently reported CPT codes in descending order were 99213 (office visit; established patient; medical decision making is of low to moderate severity), 99214 (office visit; established patient; medical decision making is of moderate to high severity), 99203 (office visit; new patient; medical ixdecision making is of moderate severity), 99212 (office visit; established patient; medical decision making is self-limited or minor), and 99204 (office visit; new patient; medical decision making is of moderate to high severity). do reimbursement levels in workers' Compensation compare to reimbursementlevels in employer group health plans?

9 Upon our survey, actual reimbursements under the fee schedules are about 99% of the reimbursements received from both carriers and patients under employee group health do Hawaii's Maximum allowable fee levels compare to the Maximum allowable fee levels of other states? the five most frequently reported CPT codes in the survey, Hawaii's Maximum allowable fees are about 102% of the average Maximum fee levels of the thirty-two states whose fee schedules we all states have fee schedules? , some do not, but most do. Some fee schedules are based on charges, expressed asthe prevailing charge or the usual and customary charge. Other fee schedules are based on the Medicare fee schedule or upon the Medicare resource-based relative value others are based upon the relative value units of the Ingenix publicationRelative Values for do states update their fee schedules?

10 Specified, the schedules are authorized or required to be adjusted on a periodic basis (although some states do not require adjustment). Specified periods of adjustment are annually, semi-annually, biennially, triennially, quarterly, periodically, from time to time, as necessary, and as needed. Sometimes, the bases for the adjustments are specified. If the basis is specified, the basis is usually the consumer price index, in particular, the consumer price index--urban. Another basis frequently used is the state average weekly wage. Other bases used includethe Medicare economic index, the year-over-year inflation rate, changes in levels of reimbursement, and prevalent 1 INTRODUCTIONThe Request of the ResolutionSenate Concurrent Resolution No.