Maine Workers’ Compensation

Medical Fee ScheduleMaine 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 10/20/11Total Benefit Costs

Medical 57%

Indemnity 43%

OVERVIEW• Claim frequency

continues to decline but appears to be leveling off.

• Medical benefits constitute the majority of total benefit costs in Maine.

© Copyright 2011. 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.”

125th Maine State LegislatureAn Act Regarding Payment of Medical Fees in

the Workers’ Compensation SystemStated 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…”

125th Maine State LegislatureThe 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.

125th 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.

125th Maine State LegislatureL.D. 1244 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P.L. 2011, c. 338 repealed and replaced the Medical Fees; Reimbursement Levels section of the Workers’ Compensation Act.

125th Maine State LegislatureThe Board was tasked with adopting rules that

establish medical fee schedules by December 31, 2011.

On November 8, 2011, the Board voted to adopt rules in accordance with the law.

Board Rule Chapter 5The current iteration of the medical fee rule

became effective on December 11, 2011.

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 5Underlying Methodology

Federal Centers for Medicare and Medicaid Services:Procedure CodesRelative Weights/Values

Conversion Factors or Base Rates

Required UpdatesThe 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 Industry3 Representatives of

laborAFL-CIO

Chair (Executive Director)

Executive Director9 Hearing officersGeneral CounselDeputy Director of

Business ServicesDeputy Director of

Information ServicesDeputy Director of

Medical/Rehabilitation Services

Senior Staff Attorney Worker Advocate Division

Annual UpdatesNotwithstanding Title 5, Chapter 375,

Subchapter 2, the Executive Director of the Board shall annually update the medical fee schedule.

Must be complete by December 31st of each year.

Annual UpdatesThe medical fee schedule must be consistent

with the most current medical coding and billing systems:RBRVSMSDRGAPC

HCPCSICDCPT

Annual UpdatesThe 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 ProvisionIf the Executive Director fails to annually

update the medical fee schedule, the reimbursement rate for medical services is 105% of the private 3rd-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 UpdatesThe Board shall undertake a comprehensive

review of the medical fee schedule once every 3 years beginning in 2014.

These periodic updates are subject to the rulemaking requirements of the APA.

Rulemaking ProcessAnnual Regulatory Agenda

Board drafts rulesGovernor’s office for pre-approvalAttorney General’s office for legal pre-

reviewPublic Hearing

Oral testimonyWritten testimony

Rulemaking Process continued…Board takes final action Governor’s office for post-approval (only if

amended)Attorney General’s office for legal post-

reviewFiling with the Secretary of State

Effective date

Periodic UpdatesThe 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 205.4

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.

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