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Policy Matters Brief April 26 2021

April 26, 2021 · Policy Matters team

Arizona legislation tweaks workers’ compensation care

A new Arizona law protects use of mail-order pharmacies for workers’ compensation claimants and clarifies the ability of payers and providers to enter into unique contract agreements. Arizona Senate Bill 1042 offers several improvements and clarifications to benefit the workers’ compensation system. 

Past policy actions in Arizona muddied the waters involving which pharmacies could provide care to injured workers by adding definitions of pharmacies “generally accessible to the general public” and pharmacies “not generally accessible to the general public.” Stakeholders questioned if mail-order pharmacies fit the definition of a pharmacy generally accessible to the general public. SB 1042 clarifies, pursuant to certain requirements, mail-order pharmacies are now considered as generally accessible to the general public. 

Additionally, SB 1042 clarifies the ability of payers and providers to enter into contracts or networks that govern fees at a rate different from fee schedule. In these cases, reimbursement shall be according to the applicable contracted charge or negotiated rate. 

SB 1042 took effect April 9, 2021. 

California DWC to address COVID-19 in the drug formulary

The California Division of Workers’ Compensation is launching a new process to address the work-related COVID-19 illness and possibly modify the existing Medical Treatment Utilization Schedule (MTUS) including the Drug Formulary. Currently, the MTUS doesn’t recognize the need for medical care and medicinal treatments for a work-related COVID-19 illness.

To move forward with modifications, the DWC will hold a virtual public hearing on May 14, 2021 to propose specific updates to the MTUS and Drug Formulary related to COVID-19. This will help align the existing MTUS to the ACOEM COVID-19 Guideline released on March 29, 2021. The current ACOEM guidelines include prescription protocols for treating COVID-19 including usage of antiviral medications. 

Colorado legislation would permit injured workers to choose their treating physician

Colorado Senate Bill 197, introduced in late March 2021, lets an injured worker designate a Level I or Level II accredited physician licensed under the state’s Medical Practice Act as their authorized treating physician. Existing law requires them to select a physician from a list provided by their employer or insurer.

The bill states that an injured worker must make this designation in writing on a prescribed form provided to them by their employer or insurer within seven business days following notice of an
on-the-job injury. They may make this one designation any time after the injury but before being placed at maximum medical improvement. If an injured worker is unable to designate a treating physician and the emergency nature of the injury requires immediate medical care, or if they do not desire to make a designation, the employer or insurer may designate one. However, designation by an employer or insurer under this provision does not prevent an injured worker from subsequently designating a treating physician for continuance of care.

SB 197, which is pending in the Senate, can be added to a list of bills introduced this year in various states seeking to reverse provider choice policies in workers’ comp. Information on bills in other states can be found in our prior update.

Kentucky enacts pharmacist reimbursement parity legislation

Kentucky House Bill 48, requiring reimbursement parity between pharmacists and other non-physician practitioners, adds reimbursement parity requirements for various insurance policies, plans, or contracts. The law amends Kentucky’s workers’ compensation law stating, in addition to all other compensation that may be reimbursed to a pharmacist under the law, the workers’ compensation payer shall be liable for reimbursement to a pharmacist for a service or procedure at a rate not less than that provided to other non-physician practitioners if the service or procedure:

  • Is within the scope of the practice of pharmacy (as defined in state law);
  • Would otherwise be compensable if the service or procedure were provided by a physician, advanced practice registered nurse, or physician assistant; and
  • Is performed by the pharmacist in strict compliance with laws and regulations related to the pharmacist's license

This type of legislation is often intended to address other services provided by pharmacists under their expanded scope of practice beyond traditional medication dispensing. While no immediate impact is expected for workers’ compensation, this may influence future fee schedule changes by the state’s Department of Workers’ Claims.

Montana rescinds prior workers’ comp drug formulary legacy claim delay

The Montana Department of Labor & Industry, Employment Relations released a notice that their prior “Legacy Claim Guidance” issued March 30, 2020 due to COVID-19 would be rescinded April 14, 2021. The prior March 2020 guidance requested that insurers and TPAs delay adherence to the workers’ compensation drug formulary requirements for legacy claims, due to COVID-19 and concerns of healthcare capacity, “until the COVID-19 crisis passes.”

Legacy claims are those arising before April 1, 2019. Under existing regulations, the formulary was to apply to prescriptions written on or after April 1, 2020, or 90 days after the insurer gives written notice to the injured person and treating physician, compliant with the regulations – whichever comes last.  More information on the Montana drug formulary can be viewed here.

New York proposes updates to non-acute pain guidelines

The New York Workers’ Compensation Board (WCB) proposes adopting a second edition of the Non-Acute Pain Medical Treatment Guidelines (MTG) to replace the initial version adopted in September 2014. If approved, the MTG will take effect on or after June 7, 2021. Further information on the proposed rules and opportunity to file comments can be found here

New Jersey Supreme Court upholds workers’ comp-related ruling on medical marijuana

On April 13, 2021, the New Jersey Supreme Court affirmed an Appellate Court’s decision regarding payment by an employer for medical marijuana treatment under workers’ compensation. In the case of Hager v. M&K Construction, the Supreme Court upheld a lower court, ruling an employer could be required to reimburse an injured worker for the cost of medical marijuana dispensed pursuant to the state’s Compassionate Use Act. 

The Court found the employer did not fit within the Compassionate Use Act’s limited reimbursement exception and the injured worker presented sufficient credible evidence to establish the prescribed medical marijuana represented, to him, a reasonable and necessary medical treatment. Finally, the Court held the Controlled Substance Act was not preempted and the employer faced no credible threat of federal criminal liability.

This ruling could lead to increased use of medical marijuana as a medically-necessary treatment for claimants in the state. Additionally, coupled with SB 3406, which is currently pending in the New Jersey legislature, medical marijuana use by workers’ compensation claimants in New Jersey is being clarified.

North Dakota state fund opioid and benzodiazepine coverage limit legislation signed

North Dakota House Bill 1139, enacting specific workers’ compensation coverage limits for opioids and benzodiazepines, includes the following provisions governing what the state fund, Workforces Safety & Insurance (WSI), may not pay for:

  • Opioid therapy that exceeds 90 morphine milligram equivalents per day, or more than aseven-day supply of an opioid medication within any single outpatient transaction during the initial 30-day period of opioid therapy (several exceptions are listed)
  • Benzodiazepine therapy beyond a cumulative duration of four weeks, except when approved by WSI for the treatment of an anxiety disorder
  • Any combination therapies that include controlled substances from either of the above (opioid or benzodiazepine therapy) concurrently

To account for older claims with existing treatment regimens, the new law contains a provision that an injured worker receiving any therapy exceeding these limits on the law’s effective date must be in compliance with the limits by July 1, 2022. After that, WSI will terminate coverage for any therapy exceeding the limits.

It is important to note that North Dakota is a monopolistic state for workers’ compensation purposes. WSI is the single payer of workers’ compensation claims in the state.

Virginia workers’ comp COVID-19 presumption bills enacted

Virginia became one of the latest states to create presumptions of workers’ compensation coverage for COVID-19 with the recent enactment of a combination of bills.

House Bill 1985, signed on March 31, 2021, establishes that COVID-19 causing the death of, or any health condition or impairment resulting in total or partial disability of, any healthcare provider who as part of their employment is directly involved in diagnosing or treating persons known or suspected to have COVID-19, shall be presumed to be an occupational disease.

This presumption may be overcome by a preponderance of competent evidence to the contrary and will not apply to anyone offered a COVID-19 vaccine by their employer, unless they are immunized or their physician determines in writing that immunization would pose a significant risk to their health. Absent that in writing, failure or refusal to undergo immunization will disqualify them from the presumption.

House Bill 2207 and Senate Bill 1375, both enacted in early April 2021, provide that COVID-19 causing the death of, or any health condition or impairment resulting in total or partial disability of, any firefighter, law-enforcement officer, correctional officer, or regional jail officer shall be presumed to be an occupational disease. This presumption may also be overcome by a preponderance of competent evidence to the contrary.

Virginia is one of several states that have established some type of workers’ comp COVID-19 presumption through executive order, state agency action, or legislation. For more information on these presumptions, we encourage review of the map on our website here.


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