UR Nation End of Month Regulatory News Summary

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AB 1422 Amended to Clarify that Providers and Executives Can Be Suspended From CA Comp System

AB 1422 was amended by Tom Daly, D-Anaheim, to clarify that providers and executives can be suspended from the CA Comp system. In other words, the word “provider” in this context not only means licensed physicians, but also hospital or facility owners and high level executives. This follows the Michael Drobot conviction. You may have heard that Michael Drobot, former owner of Pacific Hospital, pleaded guilty to one count of conspiracy to defraud a federal health care program and one count of paying kickbacks to doctors who referred patients to Pacific Hospital. Earlier this year he was suspended from participating in the California workers’ comp system. But he subsequently made a motion with the LA Superior Court to vacate the DWC’s suspension order, arguing that as an executive with Pacific Hospital he is not a “provider.”

Arizona Adopts RBRVS Fee Schedule

The Industrial Commission of Arizona gave notice through the Medical Resource Office that it has adopted the Medicare Resource Based Relative Value Scale (RBRVS) Fee Schedule. The fee schedule will apply to services rendered on or after Oct. 1. As you may know, California phased in the RBRVS fee schedule starting in 2014. While the use of the RBRVS fee schedule is something that affects carriers and TPAs more than URAs, it’s something all system participants should keep in mind.

Genex Acquired Prium

Genex Services announced that they have acquired Prium, an Atlanta-based provider of chronic pain intervention programs and UR services. Genex President and CEO Peter Madeja said the acquisition will “provide continuity of services to the current Prium customer base. It also enhances the broad service continuum at Genex for controlling claim costs and driving superior outcomes for payers as well as injured and disabled workers.”

Genex has been expanding its footprint in the workers’ compensation medical management sphere since it was acquired by investment house Apax Partners in 2014.  In 2015, the company purchased Alpha Review Corp., which provides bill review services, and CID. Shortly thereafter it also purchased Disability Management Services and Integrated Care Management.

Gov. Brown Signs SB 489 Allowing Hospitals up to 180 Days To Bill for Emergency Services

Gov. Brown signed SB 489 which extends the billing deadline to 180 days when the emergency services are provided in a licensed acute care hospital. The California Hospital Association sought the extended billing deadline and argued that a 30 day window may not be enough time for hospitals to know whether a patient suffered an occupational injury. This is especially true in severe injury cases, where a patient may not be able to verbalize the cause of injury which would allow the hospital sufficient time to submit a bill within 30 days of care.

Louisiana Bans Mandatory Genetic Testing

After learning that an injured worker was asked to submit to genetic testing at Broadspire’s request, the Office of Workers’ Compensation Advisory Council voted unanimously in favor of drafting a bulletin stating that mandatory genetic testing will not be allowed, along with drafting a cease and desist letter to Broadspire.

The issue came up after applicant attorney Bray Williams said one of his clients was asked to submit to pharmacogenetic testing. Specifically, Williams’ client was advised by Broadspire and Colorado-based laboratory Insight Labs, that the claimant was a candidate for a genetic evaluation. The letter said that the claimant was a candidate “based on current medications he/she is receiving.” The letter also said “Please note this is not a drug test or drug screening, but a genetic test evaluating metabolic processes.” The letter went on to state that genetic test results would be available within 7 days, and a report would indicate if a particular drug would not work for the patient.

Bray Williams informed the Workers’ Comp Advisory Council that the whole thing seemed “Big Brother-ish.” The Council agreed, as they spoke of the “slippery slope” down which authorizing genetic testing could lead workers’ compensation claimants.

Earlier this year Washington, which has a state-run monopolistic workers’ compensation system, decided not to cover genetic testing for claimants receiving benefits from any state-run program. They made their decision in March after their 11 member Health Technology Clinical Committee submitted a report recommending against covering the testing. The report said they did not have enough evidence that genetic testing improved patient outcomes or was cost effective.

Lastly, ODG and ACOEM do not support pharmacogenetic testing, nor do any state created guidelines, like, for example, the highly regarded Colorado Rule 17 Medical Treatment Guidelines.

Virginia Board of Medicine Adds New Regulation Regarding Buprenorphine Mono Product

Buprenorphine is an opioid used to treat opioid addiction. The buprenorphine product that contains naloxone (also known as Narcan) is a product called Suboxone. This 4:1 buprenorphine to naloxone combination acts to deter abuse as it both reduces the cravings for opioids as it prevents a patient from getting high. However, there is also a naloxone free version of buprenorphine called Subutex. Subutex, also called “buprenorphine mono-product” was created for patients who have an intolerance to naloxone. But as you might imagine, the street value of Subutex is much higher (currently $75 per pill) as opposed to only $25 per pill for Suboxone.

As a result the Virginia Board of Medicine has implemented a new regulation, effective retroactive to August 24, that requires prescribers to prescribe no more than 3% Subutex, i.e. the  non-naloxone pill. In addition, the new regulations ban prescribing Subutex for the treatment of chronic pain. There is an exception, however, for treatment of pain for cancer and those who are enrolled in a clinical trial as authorized by state or federal law. At UR Nation, we believe the thinking behind the 3 percent cap is that probably only 2 out of 100 people have an allergic reaction to naloxone. So anything above that amount may be being steered toward illegal use.

Washington Labor & Industry Looking at Acupuncture Pilot Program

The State of Washington’s Department of Labor & Industry gave notice that they are looking at implementing an acupuncture pilot program as part of their monopolistic state fund system. Currently, regulations state that neither Labor & Industry nor self-insured employers can pay for acupuncture services. But the thinking about acupuncture appears to be changing.

Under the pilot program, which would start Oct. 1, and is scheduled to continue for two years, program participants can receive up to 10 acupuncture treatments. However, looking at the FAQ page it shows that all treatment has to relate to back pain covered by workers’ comp. Also, there must be documentation of clinically meaningful improvement in pain and function in order to obtain all 10 treatments. Also, the treatments must stop when the injured worker has reached maximum medical improvement (MMI).

UR Nation believes that the increasing use of acupuncture in work comp may be a trend we need to be prepared for as a company. This is especially true in light of the compelling need by system participants to get injured workers off opioids.

Tom Swiatek

Tom Swiatek

As Assistant Vice President of Regulatory Services, General Counsel, and Editor in Chief of UR Nation, Tom Swiatek draws on his experience as an insurance attorney on both the general liability side, as well as on workers’ compensation matters. As a California Workers’ Compensation Section Member, Tom is leading the discussion with respect to the regulatory challenges and opportunities facing the workers’ compensation system.