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The latest legislative and regulatory activity that impacts you and the services we provide

Policy Matters Brief - September 12, 2024

September 12, 2024 · Public Policy & Regulatory Affairs Team

New York Workers’ Compensation Board releases CMS-1500 billing project update

As part of its ongoing modernization initiative, the New York State Workers' Compensation Board (Board) will require health care providers to contract with an electronic submission partner to submit the CMS-1500 universal medical billing form in 2025. In 2022, the Board transitioned to the CMS-1500 in order to reduce the administrative burden on health care providers. This new requirement will increase accuracy, efficiency, and data reporting capabilities as it helps the Board move paper-based processes online.

The CMS-1500 electronic submission requirement for providers will become mandatory on August 1, 2025. As of that date, the Board will not take action on or enforce payment of a bill submitted on a paper CMS-1500 form. Although forms submitted before then will continue to be processed, providers are encouraged to transition to electronic submission well in advance of that date to reduce any submissions "lost" in the transition.

Information on the release and the expanded CMS-1500 billing project rules can be found here.

Pennsylvania Supreme Court to review medication reimbursement dispute

The Pennsylvania Supreme Court has granted review of disagreement over the proper application of the state workers’ compensation prescription fee schedule in resolving workers’ compensation fee disputes. In January, the Pennsylvania Commonwealth Court held that published AWP reimbursement rates found in Red Book do not accurately represent their average wholesale price. The Commonwealth Court then ordered the Bureau of Workers’ Compensation to identify a nationally recognized schedule of pharmaceutical pricing under which the Bureau could resolve payment disputes.

Since Red Book reflects manufacturers’ pricing data rather than what is actually charged by wholesalers, the Commonwealth Court found that using Red Book values as the AWP to resolve payment disputes conflicts with its interpretation of what an AWP is. Accordingly, the Commonwealth Court invalidated the regulation identifying Red Book values as the average price to be used to resolve payment disputes.

The Pennsylvania Supreme Court has placed the case on its working docket; information on the case can be found here.

New Mexico workers’ comp proposes payment rules requiring preauthorization for physician dispensing; adds late payment penalty

The New Mexico Workers’ Compensation Administration (WCA) proposed updates to rules pertaining to payment for health care services. Of note, the recommended updates include increasing the days supply allowed for new prescriptions dispensed by health care providers from 10 days to 14 days, but disallowed reimbursement for any renewal prescription unless preauthorized by the payer. The proposed rule changes also add a penalty of 10% of the unpaid fee schedule rate or $25 (whichever is greater) for late payment of medical bills.

Although the WCA held a public webinar on September 6 regarding this issue, it will accept comments in writing from those who were unable to attend. Once the WCA prepares final drafts of the proposed rule changes, a public hearing will be held on October 18, 2024. More information on this rulemaking and the comment period can be viewed here.

Proposed changes to Ohio workers’ comp pharmacy fee schedules

The Ohio Bureau of Workers’ Compensation (BWC) proposed changes to its rules governing pharmacy fees. The fee schedules for state fund claims and self-insuring employer claims will both be impacted.

The two main substantive proposed changes include:

Aligning the maximum product cost component dollar cap for any non-sterile compounded prescription for a self-insuring employer claim with the existing dollar cap for a state fund claim (reducing from $400 to $100 to match)
Removing specific percentages and fees in favor of language stating that the BWC will determine those percentages and fees subject to annual review (outside of these actual regulations).

A public comment period is open on these proposed changes until September 17, 2024. More information can be viewed here.

California revives bill requiring private employer workers’ comp UR physicians to hold California license

California Senate Bill 636, a bill narrowing the pool of physicians eligible to render utilization review (UR) denials, was revived in August after being dormant for nearly a year. The bill was removed from the inactive file and passed by both chambers. In its current form, SB 636 requires that specifically for private employers, starting July 1, 2026, only a physician licensed to practice in California will be permitted to modify or deny requests for authorization of medical treatment. The bill is now eligible for governor action.

Texas issues reminder about workers’ comp rule changes regarding medical examinations

The Texas Division of Workers’ Compensation (DWC) recently adopted rule changes in Texas Administrative Code (TAC) chapters 133 and 134 related to doctor examinations. The DWC issued a reminder of the rule modifications and their impact on doctor examinations, specifically billing and reimbursement for certain workers' compensation-specific services. These include designated doctor examinations, required medical examinations, work status reports, maximum medical improvement evaluations, and impairment rating examinations by treating and referred doctors.

More information on these rule changes and the reminder from the Division can be found here.

Additional Optum resources:

For more information on these policy developments and others we have been tracking this year, be sure to visit our Legislative and Regulatory Tracker. Bills or regulations can be filtered by insurance line, topic, status and jurisdiction.

If you have questions on these or any other public policy developments, please contact our team at OptumWC.PolicyMatters@optum.com.

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