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September 04, 2013

Pennsylvania Workers Compensation Medical Fee Review

When an injured worker receives medical treatment in Pennsylvania the medical providers are subject to sections of the Pennsylvania Workers’ Compensation Act [Act] andMedical Cost Containment Regulations [Regulations] that dictate the amount they will be paid. Most people are familiar with the repricing aspect of a claim wherein the medical provider may bill their usual & customary charges, but is paid less. However, when a Medical provider disputes the amount or timeless of payment, the medical fee review application process is still a mystery to many. Below I have addressed some of the more common issues with medical fee review but please do not hesitate to contact me with any questions.


Initial Receipt of Medical Bills


            Once you receive medical bills, you have 30 days to process those bills. If the bills do not have the necessary HCFA or UB form, treatment notes attached that correspond to the coding on the forms and the LIBC-9 form, you should deny the bills for noncompliance with the Regulations. It is necessary to take that step because if a provider’s bills are repriced you lose the opportunity to argue that the provider did not submit the bills properly. It may seem insignificant, but even if the provider does not submit the LIBC-9 form you have the legal right to reject the bills and, at the very least, it delays when interest begins to accrue, which can be substantial, depending on the awarded amount. This is the time to deny any bills if they are not causally-related to the accepted work-injury or to file a Utilization Review (UR) challenging the reasonableness & necessity of the treatment.


Explanation of Benefits


            Once causally-related bills are properly submitted pursuant to the Regulations, the first step in the fee review process is a review and possible reduction of the provider’s invoiced charges that is set forth in an Explanation of Benefits (aka Explanation of Review). That EOB notifies the provider why their charges were reduced. Some reasons for reducing the charges are: the amount exceeds the fee schedule, duplicate charges, unbundling certain charges that are factored into the payment of a surgical procedure and billing separate treatment, such as anesthesia, as a separate billable entry. There also could be the reduction from trauma or burn center charges. We will address trauma/burn center billing in more detail below, but whatever the reason for the reduction that is set forth in the EOB, the provider has a period of time to file a fee review application if they dispute the reduction in the charges.


Fee Review Application


            The providers are given two opportunities in which to timely file an application for fee review. They may either file within 90 days of their original billing date or 30 days after they are provided notice of a “dispute”, whichever date is later.


If you receive a fee review application and you dispute that the provider has the basis to file the application, you must act immediately and notify the fee review Office that you are objecting. Common objections would be as follows: you never received the bills pursuant to the Regulations, you have denied liability for the claim, you are litigating a Claim Petition or Medical Review Petition disputing causation of the treatment billed, you have filed a UR. Regardless, if you have a reason to object you should do so because the fee review office of the Bureau of Workers’ Compensation [BWC] is obligated to return the application. Nevertheless, if you do not raise the objection it could be waived.


            Assuming the bills were properly submitted, no UR was filed, you repriced the bills and the provider was mailed the EOB, then the provider would have the basis to file an application for fee review if they disputed the amount they received or the timelessness of payment. Following the filing of an application for fee review, you should receive an email from the fee review office of the Bureau of Workers’ Compensation [BWC] giving you a very short period of time to provide them with your position in opposition to the provider’s filing. Many of our clients forward the email to our attention and we reply on their behalf, setting forth the legal basis for why the bills were reduced or denied.


            Thereafter, the fee review office will issue a Determination. The Determination will award the provider with the amount of money they requested, award additional monies but not as much as the provider requested, or they will affirm the amount identified on the EOB.


Fee Review Determination


            A very critical point in the process is when the fee review office circulates its Determination. Believe it or not, the fee review office will only mail the Determination to the insurance or self-insured employers.


From a legal standpoint, there are rarely self-insured employers. Most companies that are referred to as “self-insured” actually have a self-insured retention (SIR) and thus there is an insurance company (often called the “excess carrier”) involved. Bottom-line is that only the excess carrier will receive the Determination. but you as the adjuster will not if you do not work directly for the excess carrier.


The practical problem for adjusters who are working for, or operating as, the TPA for the excess carrier, is that the excess carrier will assume that the fee review office sent you a copy of the Determination because at every other step the fee review office communicates with you as the adjuster. As the adjuster, you need to notify the excess carrier of this flaw in the fee review office’s procedures in order for you to receive, from the excess carrier, the Determination so that the 30 days to file a de novo appeal does not pass without your knowledge.


The flaw in the BWC’s procedure is particularly troublesome when the Determination is large. In fact, I am handling a de novo appeal that the adjuster was not sent theDetermination within 30 days by the excess carrier and the fee review office awarded the medical provider slightly less than $200,000 in additional payments.


The point to take away is that you need to actively communicate with the excess carrier to forward the fee review Determination so that you do not lose the opportunity to file a de novo appeal.


De NovoAppeal


            If you dispute the fee review Determination, you may file a de novo appeal that will be assigned to a Fee Review Hearing Officer. In the last few years, certain Workers’ Compensation Judges have agreed to sit as Fee Review Hearing Officers on special days to litigate the de novo appeals. The de novo designation means that the fee review Determination is not binding on any party and the matter will be reviewed anew. Nevertheless, the burden is always on the insurer/employer to prove your case should you file a de novo request. At that level you can present evidence to persuade the Hearing Officer as to why the provider should not receive the additional monies requested.


Trauma Case/Burn Case


            More times then not, the largest amount of money in Fee Review disputes involve treatment at a Trauma or Burn Center. This is because the Workers’ Compensation Act has an “exception” to the bill re-pricing provision. Section 306(f.1)(10) of the Act states:


If acute care is provided in an acute care facility to a patient with an immediately life threatening or urgent injury by a Level I or Level II Trauma Center … or to a burn injury patient by a burn facility… or if basic or advanced life support services, as defined and licensed under the “Emergency Medical Services Act,” are provided, the amount of payment shall be the usual and customary charges. (Emphasis added)


The legislative intent in the above section is clear and unambiguous. The legislature intended to carve out a very limited exception to the statutory fee caps under the Act. For the exception to apply, two conditions must be met: 1) acute care is provided in an accredited level I or level II trauma/burn center; and 2) the patient must have an immediately life threatening or urgent injury.


Clearly, the legislature did not intend the exception to apply to all care provided at a level I or II trauma/burn center, otherwise, the statute would indicate as much. Additionally, the legislature did not intend the exception to apply to potentially life threatening or urgent injuries because the statute clearly states immediately life threatening or urgent injuries. Had the legislature intended to make this exception more inclusive it would have included the qualifier “potentially” or would have simply said that all treatment at a trauma/burn center is paid at one hundred percent of their usual & customary charges. However, because the legislature included the qualifier “immediately,” under the rules of statutory construction, credence must be given to this qualifier.


Stated simply, the legislature’s intent of limiting the exception to immediately life threatening or urgent injury was to be in only the highest level of medical priorities where seconds could mean the difference between life or death for the claimant. The practical effect of this is that when you read that statement in the Act it clearly implies that not all treatment provided at a trauma center/burn center is paid at one hundred percent because it does not say so. Yet, we have all seen that the large majority of bills submitted by a trauma center/burn center have a stamp on the UB form stating “Pay at 100% an accredited trauma (or burn) center.” But unless you are aware that not all treatment at a trauma or burn center is paid at one hundred percent you may not think to reprice the bills. Further still, even if the bills are repriced the trauma/burn centers often will file the application for fee review because they believe that everything they do falls within the exception of the Act.


            Another misconception arises from the wording of the Medical Cost Containment Regulations. The Regulations state that if the EMTs at the scene decide that the claimant fell within the Field Triage Guidelines authored by theAmerican College of Surgeons, to be transported to a trauma/burn center that there is a presumption that the person had injuries that were “immediately life threatening or urgent injury.” The problem with that practical reading is that the Field Triage Guidelines suggest to transport a patient to a trauma/burn center when they have the potential to fall into an “immediately life threatening or urgent” state as well as those who are actually in an immediately life threatening or urgent” state. A doctor once testified that the Field Triage Guidelines are designed to “over-triage” just to be safe. While we all could probably agree that over-triaging patients for their own protection is important, the benefit of the fee review process is that we have the ability in hindsight to evaluate the evidence and determine whether the person was actually suffering from an injury that was “immediately life threatening or urgent.” Ultimately, I recommend that you consider repricing all medical bills, including trauma/burn center charges.




            As a practical matter, please note that when a provider files a Fee Review it is a type of litigation. Whether or not to fight the review is ultimately a business decision. For example, you would not file a de novo application to fight an award of $100 to be paid to the provider because the legal fees would outweigh the cost of paying an additional $100. However, and as a general rule of thumb, any bills in excess of $10,000 should be evaluated for the prospect of filing a de novo appeal to the Fee Review Determination. Over the course of a year if you were merely to fight the trauma/burn center charges in Pennsylvania that are mistakenly believed to fall within the exception, that could amount to millions of dollars in savings for the company. Upon reading this medical fee overview, I hope that you see plausible reasons to fight a fee review determination.


            If you desire, please know that the attorneys at Cipriani & Werner, p.c. are willing, free of charge, to present more detailed training on the fee review process or any other topic.