Generally speaking, and with certain exceptions, the No-Fault Insurance reimbursement rates for medical claims are contained in the Workers’ Compensation Fee Schedule. See Ins. Law §5108 (“The charges for services … shall not exceed the charges permissible under the schedules prepared and established by the chairman of the workers’ compensation board … The superintendent [of the Department of Financial Services], after consulting with the chairman of the workers’ compensation board and the commissioner of health, shall promulgate rules and regulations implementing and coordinating the provisions of this article and the workers’ compensation law with respect to charges for the professional health services … No provider of health services … may demand or request any payment in addition to the charges authorized pursuant to this section.”). See also 11 NYCRR 68.1 (“(a) The existing fee schedules prepared and established by the chair of the Workers’ Compensation Board for industrial accidents are hereby adopted by the Superintendent of Financial Services with appropriate modification so as to adapt such schedules for use pursuant to the provisions of Insurance Law 5108”).
The Workers’ Compensation Fee Schedule is divided into sections based on general categories of services, such as Evaluation & Management, Radiology, Physical Medicine, Surgery, General Medicine, etc. These sections, however, are “for structural purposes only” and are not intended to limit the type of service a licensed medical practitioner can perform and bill. Additionally: “If a fee schedule has been adopted for a licensed health provider, the fee for services provided shall be the fee adopted or established for that licensed health provider …” 11 NYCRR 68.1(b)(3). There are Fee Schedules for chiropractors, podiatrists, dentists and psychologists. Services contained in the Worker’s Compensation Fee Schedule are identified by CPT (current procedural terminology) codes. Where a particular service is contained in the Workers’ Compensation Fee Schedule, the permissible charge is calculated by multiplying the relative value for that service by the applicable conversion factor. There are separate conversion factors based on type of service (Example: medicine, evaluation and management, physical medicine, self-employed physical and occupational therapists, surgery, radiology). The amount for each conversion factor, in turn, varies based on the geographical region in the State where the service was performed. In addition to such relative values and conversion factors: “The general instructions and ground rules in the workers’ compensation fee schedules apply [to no-fault insurance claims], but those rules that refer to workers’ compensation claim forms, pre-authorization approval and dispute resolution guidelines do not apply, unless specified in this Part.” 11 NYCRR 68.1(b)(1).
One such ground rule, Ground Rule 11 contained in the Physical Medicine section, and corresponding Ground Rule 3, contained in the Chiropractic Physical Medicine Fee Schedule, is the subject of many disputes between no-fault insurers and the billing medical providers. Physical Medicine Ground Rule 11 provides: “When multiple physical medicine procedures and/or modalities are performed on the same day, reimbursement is limited to 8.0 units or the amount billed, whichever is less.” The ground rule lists 30 CPT codes for physical medicine services that are subject to this ground rule. The number of “units” for each such service subject to this ground rule are actually the relative value units (RVUs) assigned to each service. For example, the RVU for CPT code 97010 (hot or cold pack treatment), the first listed service in this ground rule, is 2.37. Thus, whatever RVUs are assigned to particular services performed in one day, the maximum reimbursement per day will be 8 RVUs multiplied by the conversion factor for that provider in the geographic region. For example, the Regional Conversion Factor for a self-employed physical therapist in Region IV (the downstate metropolitan area including New York City and parts of Long Island) is 7.7. The maximum 8.0 RVUs multiplied by 7.7 is $61.60. This means that no matter how many different modalities are performed in a given day (Example: massage, hot/cold packs, electrical stimulation, whirlpool) if those modalities are listed in Ground Rule 11, a self-employed physical therapist’s current maximum reimbursement per day for those services is $61.60. If an initial or follow-up evaluation is also performed that day, the maximum for a self-employed physical therapist in Region IV is increased to 13.5 units or 11 units, (or $103.95 or $84.70), respectively, under Ground Rule 8. Ground Rule 3 of the Physical Medicine section of the Chiropractic Fee Schedule contains a similar 8.0 RVU maximum reimbursement provision for physical medicine and chiropractic manipulation modalities performed by a chiropractor. As the conversion factor for a chiropractor performing physical medicine in Region IV is currently $5.78, the 8.0 unit maximum would amount to $46.24. If an initial evaluation or follow-up evaluation is also performed the same day, the maximum is increased to $78.03 and $63.58, respectively.
This 8.0 unit maximum has been and continues to frequently be the subject of numerous disputes between medical providers who perform physical medicine modalities, and no-fault insurers. For example, a review of American Arbitration Association (the entity designated to conduct no-fault arbitrations in New York) arbitration awards issued in the last 30 days of this writing revealed that over 500 of such arbitrations involved the interpretation and/or application of Physical Medicine Ground Rule 11 (and/or Chiropractic Physical Medicine Ground Rule 3).
In these cases, the provider’s bill was denied in whole or in part based on the insurer’s determination that the maximum 8 units have been paid. If, for example, a physical therapist performs and bills for 8 or more units, disposition of that provider’s claim is simple: Determine the maximum daily reimbursement, as set forth above, and deduct the amount already paid by the insurer. The remainder is what is due to the provider. Frequently, however, the insurer’s allegation is that the daily 8 units have been exhausted, in whole or in part, by payment to another medical provider performing physical medicine modalities on the same day. In those instances, the proofs required of the insurer, and the disposition of the case, become more complicated. For example, where a physical therapist’s bill is denied in whole or in part based on the insurer’s allegation that the daily 8 units, or a portion thereof, were paid to a chiropractor, a massage therapist, a physician or even another physical therapist who also performed services the same day, the insurer will need to prove that the other provider billed for physical medicine services on the same day, the RVUs for those services and the amount that was paid to that provider. Documentary proof will usually consist of the other provider’s bill, the canceled check to that provider and the explanation of benefits that accompanied the check.
One issue that has complicated these matters is determination of whether the 8 unit maximum is per treating medical provider, per type of treatment, per type of medical provider or per patient. Decisions from arbitrators and judges have varied on this issue, with many holding, for example, that a chiropractor billing for physical medicine and chiropractic manipulation modalities is not precluded from reimbursement even though a treating physical therapist was already paid for 8 units of physical medicine. The Workers’ Compensation Board’s Notice of Adoption of the revised Fee Schedules in 2010 (N.Y State Register, Volume XXXII, Issue 47, Nov. 24, 2010) provides support for these awards. In its Assessment of Public Comments to the proposed fee schedule changes, the Worker’s Compensation Board stated, in response to the question of whether the RVU limits apply regardless of the number and type of treating providers: “Finally, if a chiropractor performs 8 RVUs of the 16 CPT codes he/she can perform and a physical therapist performs additional RVUs for CPT codes that cannot be performed by a chiropractor on the same day, then both can be paid as they provided different treatment.”
The Worker’s Compensation Board has recently proposed amendments to the various fee schedules that will have an impact on patient treatment and reimbursement to medical providers, including, but not limited to, chiropractors and physical therapists. Upon final adoption by the Worker’s Compensation Board, these fee schedule changes will go into effect for no-fault claims eighteen months after the effective date (11 NYCRR 68.1(b)(2)).
Rental Fees for Durable Medical Equipment
Matter of Global Liberty Ins. Co. v. ISurply, 163 A.D.3d 418 (1st Dept. 2018) is instructive as to the proper rental fee for durable medical equipment. In that case, the medical supply company arbitrated its claim for reimbursement of the monthly rental of a Continuous Passive Motion device (CPM) and a Cold Therapy Unit (CTU), which are post-surgical rehabilitation devices prescribed by the injured person’s treating physician. The arbitrator found that the correct reimbursement rate for these devices was the monthly rental charge to the general public. A master arbitrator affirmed the award, the Supreme Court denied the insurer’s petition to vacate the award, and the insurer appealed.
As the Appellate Division held:
The controlling law here, for reimbursement of rental costs for a Continuous Passive Motion device (CPM) and a Cold Therapy Unit (CTU), is 12 NYCRR § 442.2 (b), which states: “The maximum permissible monthly rental charge for such equipment, supplies and services provided on a rental basis shall not exceed the lower of the monthly rental charge to the general public or the price determined by the New York State Department of Health area office. The total accumulated monthly … charges shall not exceed the fee amount allowed under the Medicaid fee schedule.”
The insurer argued that the Department of Health (DOH) had determined a price for these rentals, which was 1/6th of the equipment provider’s acquisition cost, and presented an opinion letter from the Department of Health’s (DOH) legal counsel to support its defense. However, the arbitrator determined that the letter was insufficient proof, particularly as DOH counsel stated that her letter “was not a determination by the Department of Health area office establishing the reimbursement rate.” The Appellate Division agreed and found that the insurer failed to prove that the DOH adopted the 1/6th of acquisition cost rate. With respect to the insurer’s argument that the Medicaid DME fee schedule limits reimbursement to 1/6th of the acquisition cost, the court held, “However, it was not irrational for the arbitrator to conclude that this 1/6th rate applied only to items which had codes listed in the Medicaid fee schedule, which the CPM and CTU at issue here did not.” The Appellate Division therefore affirmed the denial of the insurer’s petition to vacate, thus upholding the monthly rental charge to the general public as the correct reimbursement rate.
David M. Barshay is a member of Sanders Barshay Grossman in Garden City. Steven J. Neuwirth, a member of the firm, assisted in the preparation of this article.