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Policy Matters Brief October 12, 2021

October 12, 2021 · Public Policy & Regulatory Affairs Team

Colorado workers’ comp fee schedules updated – topical medication reimbursement language clarified
The Colorado Division of Workers’ Compensation adopted annual revisions to their fee schedule rule. Notable changes affect medical, ancillary and facility reimbursement values, as well as updated coding and reimbursement source documents. The revisions take effect January 1, 2022.

Noteworthy for pharmacy, is a requirement to pro-rate down reimbursement for certain topical medications.

Existing rule language established:

  • Certain maximum allowable dollar caps for any topical muscle relaxant, analgesic, anti-inflammatory, and/or antineuritic medications containing only active ingredients available without a prescription
  • Those caps are based on cost to the billing provider up to certain amounts per a 30-day supply

The rule changes for 2022 have added:

  • When less than a 30-day supply is prescribed, those allowances should be pro-rated to the amount dispensed to the injured worker.

This change was recommended by our Public Policy & Regulatory Affairs team to clarify the rule language on how supplies lower than a 30-day supply are to be reimbursed

Colorado DWC schedules physician choice forum

The Colorado Division of Workers' Compensation has scheduled a “Physician Choice Forum” to  discuss the physician choice process and ensure it works effectively for all stakeholders.

Legislation failed to pass earlier this year (SB 197) that would have provided injured workers control over the selection of their primary treating physician in workers' compensation cases. The bill would have allowed injured workers to choose from any Level I or Level II accredited physician. Existing law requires injured workers to select a physician from a list provided by their employer or insurer.

This forum is scheduled for October 19, 2021 and will be held on Zoom (prior registration is required). Questions or comments can be directed to David Gallivan (

Michigan auto no-fault fee schedule rules finally adopted

After a required legislative committee review period, rules to supplement the first auto no-fault medical fee schedules in Michigan, that went into effect earlier this year, were finally filed and adopted. The rule text, became effective October 1, 2021; however, the fee schedules went into  effect, by law, July 2, 2021.

The rules provide supplemental guidance to provisions from the 2019 auto no-fault reform law and from Department of Insurance and Financial Services (DIFS) bulletins. Specifically – the rules:

  • Define the applicable Medicare fee schedule(s)
  • Establish procedures for determining which providers are eligible for enhanced reimbursement
  • Establish procedures for DIFS to collect information related to amounts charged by providers as of January 1, 2019 for resolving provider appeals
  • Establish a date and methodology for determining the adjustment of reimbursement
  • Establish procedures for DIFS to administer clinic accreditation requirements

Of particular note, is the rules define the applicable Medicare fee schedule(s) to be those in effect on March 1 of the “service year” (notwithstanding any subsequent changes) and provide a backup charge source (FAIR Health) for DIFS to use in appeals related to provider average charges. Additional fee schedule resources from DIFS can be viewed here.

Michigan DIFS advises on auto no-fault medical bill payment and review requirements

The Michigan Department of Insurance and Financial Services (DIFS) issued a bulletin advising payers and providers of timely payment, communications and other actions for auto no-fault medical bills.

Expectations for insurers

After reviewing existing timeframes in the law, the DIFS noted that, “As insurers and providers alike adjust to the new law, insurers are expected to engage in a dialogue with providers to assist them in understanding the insurer’s review of the provider’s bills; and to expedite bills resubmitted with corrected codes.”

The bulletin goes on to state: “Insurers are advised that the Department will carefully scrutinize complaints in which an insurer has repeatedly rejected a provider’s bills without offering assistance. The Department expects providers and insurers to attempt to resolve billing and coding disputes informally, as they have customarily done prior to the implementation of the fee schedule. In addition, insurers should provide reasonable assistance to ensure that the insurer’s billing and coding requirements are clearly conveyed to providers and their billers.”

The bulletin also reviews the provider appeal process (part of the utilization review rules), noting the following: “… the Utilization Review process is available only to resolve questions of medical necessity or appropriateness of cost. The Department’s Utilization Review program cannot be used to resolve billing or coding disputes that occur prior to a formal determination issued by the insurer as to the medical necessity or appropriateness of cost.” DIFS also encourages providers to review their Health Care Provider’s Guide to Michigan’s Auto Insurance Utilization Review Process prior to filing an appeal.

New York updates payer compliance requirements for CMS-1500 project

With pending implementation of several CMS-1500 projects, on September 29, 2021, the New York Workers’ Compensation Board (WCB) updated compliance requirements for payers impacted by the project. CMS-1500 directs payers and providers to share billing information and related transactions electronically using the prescribed form and formats. 

The most recent release reminds stakeholders that effective October 1, 2021 payers must:

  • Electronically accept Form CMS-1500 via EDI or other agreed-upon format. Payers will electronically transmit the EOB/EOR to their XML submission partners upon the adjudication of the submitted electronic CMS-1500 medical bill.
  • Acknowledge medical bills within seven business days.  Payers must accept an electronic bill from an XML submission partner when it is transmitted using EDI or another format agreed upon with the XML submission partner.

While the first two pieces of the transactional business processes took effect October 1, 2021, two additional pieces of the project take effect a bit later, when payers must:

  • Designate their XML submission partner by October 31, 2021.  Payers must designate at least one XML partner and must keep XML submission partner information accurate and update the WCB on-line system within three business day of any changes.
  • Identify all legal and valuation objections for payment of the medical bill and submit them at the same time and on the same EOB/EOR by November 1, 2021.  Payers are required to make such objections within 45 calendar days of acknowledgement of receipt of the medical bill whether on paper or digital.
  • As of November 1, 2021, payers must continue to file the current versions of the C-8.1B and C-8.4 forms with the WCB along with a copy of the EOB/EOR to object to a payment of a bill. 

More information on the project can be found, here.

Virginia workers’ comp medical fee schedules updated

Formal notice of adopted updates to the Virginia workers’ compensation medical fee schedules (MFS) and ground rules has been published. Notable changes include updates to billing codes and general increases to fees based on two years of inflation (approximately 5.7%). The updates are scheduled to take effect January 1, 2022.

As before, the MFS do not apply to the following services:

  • Physician dispensed, retail or mail order prescription drugs
  • DME dispensed through a retail DME provider
  • Professional or facility services associated with a traumatic injury or serious burn
  • Air ambulances

Also exempt are health care services:

  • Subject to a written contract between a health care provider and an employer or insurer, and
  • Those services involving voluntary payments in excess of the MFS.

The MFS were first implemented in 2018, and statute requires them to be updated every two years. 

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