Keefe: WC Commission Holds the Line on Medical Fees

Wednesday, December 27, 2017 | 0

Last week, I was mildly surprised to see Crain’s Chicago Business report a planned change to the state Medical Fee Schedule. The idea was to vote on a motion to increase the only low-cost fees in the state system to a much higher cost. I have no idea how this expensive change would come up during the holiday season and consider the approach and timing to be mildly sneaky.

Eugene Keefe

The motion was voted down 5-4 with Democrats/labor oddly voting to try to get higher reimbursement for wealthy doctors. Not sure how Democratic votes for higher medical reimbursements would help labor or less wealthy workers.

Either way, the Workers Compensation Research Institute reported that the state Medical Fee Schedule costs are higher than most of our sister states. The study can be found here.

The Illinois Workers’ Compensation Commission was asked to vote on whether to increase by 30% physician reimbursements for evaluation and management services, a move that could partially undo a cost-cutting measure signed in 2011 by then-Gov. Pat Quinn.

Our state’s Medical Fee Advisory Board voted 5-3 (with both physician members voting yes) in March 2017 to increase reimbursements for the six most common evaluation and management Current Procedural Terminology codes. Physicians and their advocacy organizations argued that Illinois’ reimbursement rates for those services were somehow limiting injured workers' access to care. I consider that a complete hoot!

The state WC system took that recommendation to the full nine-member commission, which met last week for only the third time this year.

Business and insurance groups argue that Illinois has among the most expensive WC medical costs in the U.S. The same industry reps confirmed that the Medical Fee Schedule Advisory Board presented no empirical or statistical evidence to back up these unusual claims of diminished access to work-related medical care.

I was reminded of the Hawaii WC system, where their state cut the medical fee schedule so much that doctors and hospitals started turning away WC patients and sending them to WC “mills,” where treatment stunk. No one has reported that issue/problem to me here.

As you read this, Illinois is tied with Oklahoma for the seventh-highest WC premiums in the country, according to the national rate-ranking summary published by the Oregon Department of Consumer and Business Services. But the National Council on Compensation Insurance confirmed that Illinois’ cumulative voluntary rate level has dropped 36.5% since House Bill 1698 was signed by Quinn and enacted on Sept. 1, 2011. The crux of the bill was a provision that reduced WC medical fee payments across the board by 30%.

The proposal before the commission last week would cost Illinois employers “tens and tens of millions of dollars,” said Mark Denzler, vice president and chief operating officer of the Illinois Manufacturers’ Association. “They’re trying to give an early Christmas present to the medical community and trying to give the business community a lump of coal in their stocking,” Denzler said.

By state law, the Workers’ Compensation Commission is empowered to make changes to the medical fee schedule only if there is a proven lack of access to quality medical care, said Steve Schneider, Midwest region vice president for the American Insurance Association. He pointed to the October study by the WCRI that showed for 2013 claims, Illinois’ average payment per claim with more than seven days of lost time was 24% higher than the median study state and 28% higher for the same claims in 2015.

The same study showed that fees for evaluation and management services (office visits) were among the lowest of 44 states with fee schedules, at only 3% above Medicare. Overall, Illinois’ costs for professional services were 74% above Medicare, the WCRI study said.

“Medical costs for workers’ compensation care in Illinois on average are far more than in most other states. This seems to be the wrong move at the wrong time,” Schneider wisely said.

The Medical Fee Advisory Board’s proposal would increase reimbursements for CPT codes 99203, 99204, 99205, 99213, 99214 and 99215 across four geographic areas. What follows is a breakdown of each code, how much on average it would increase under the Advisory Board’s proposal, and a comparison with other states offered by the Illinois State Medical Society and Illinois Health and Hospital Association in a Nov. 28 letter to the commission. They said the numbers came from WCRI.

• § 99203 is for office visits by new patients with conditions of low severity. The average reimbursement for this code in Illinois is $115.35, compared with $164 in Iowa, $162 in Indiana and $240 in Wisconsin. A 30% increase in 99203 reimbursements would be an average of $149.96 in Illinois.
• § 99204 is for office visits by new patients with conditions of moderate complexity. The average reimbursement for this code in Illinois is currently $174.96, compared with $256 in Iowa, $257 in Indiana and $379 in Wisconsin. A 30% increase in 99204 reimbursements would be an average of $227.45 in Illinois.
• § 99205 is for office visits by new patients with conditions of high complexity. The average reimbursement for this code in Illinois is currently $215.63, compared with $313 in Iowa, $293 in Indiana and $425 in Wisconsin. A 30% increase in 99205 reimbursements would be an average of $280.32 in Illinois.
• § 99213 is for office visits by current patients with conditions of low severity. The average reimbursement for this code in Illinois is $75.15, compared with $104 in Iowa, $103 in Indiana and $157 in Wisconsin. A 30% increase in 99213 reimbursements would be an average of $97.70 in Illinois.
• § 99214 is for office visits by current patients with conditions of moderate complexity. The average reimbursement for this code in Illinois is currently $110.95, compared with $159 in Iowa, $158 in Indiana and $243 in Wisconsin. A 30% increase in 99214 reimbursements would be an average of $144.24 in Illinois.
• § 99215 is for office visits by current patients with conditions of high complexity. The average reimbursement for this code in Illinois is currently $151.39, compared with $209 in Iowa, $221 in Indiana and $330 in Wisconsin. A 30% increase in 99215 reimbursements would be an average of $196.81 in Illinois.

“Basically this is about access to injured workers to get them the care they need,” said Danny Chun, vice president of corporate communications and marketing for the Illinois Health and Hospital Association. “We believe the evaluation and management rates are low, and even low compared to surrounding states.”

The commission increased maximum reimbursement for 20 CPT codes in 2014, but at that time there was little objection by payers. The increases ranged from 5.7% to 28.8% and impacted CPTs dealing with outpatient visits, initial hospital care, home health services and hospital discharges. 

Of the nine commissioners, all either appointed or reappointed by current Republican Gov. Bruce Rauner, three each represent employees, employers and the public. Chairwoman Joann M. Fratianni would have voted in the event of a tie.

Eugene Keefe is a founding partner of Keefe, Campbell, Biery and Associates, a Chicago-based workers' compensation defense firm. This column was reprinted with his permission from the firm's client newsletter.