Moving on the 12-Point Plan

Tuesday, December 28, 2010 | 0

By Julius Young
Boxer & Gerson

The California Division of Workers' Compensation has now unveiled another proposed feature of its 12-point plan to help control medical costs. The latest proposal is a revision of inpatient hospital fees and a revision of hospital outpatient fees and ambulatory surgery center fees.

Hearings are now slated on these fee revisions for Jan. 25 at 10am in the Elihu Harris State Building auditorium in Oakland. Public comments are being solicited on the regs until Jan. 25 (they can be sent to Maureen Gray, regulations coordinator at the DWC, 1515 Clay Street, 18th Floor, Oakland CA 94612)

The DWC announcement claims that:

"Savings from these two proposals is expected to be $59 million the first year and $86 million per year thereafter. These savings may later be used in the process of updating the physician fee schedule."

As I've noted before, medical costs (and medical-containment costs) are major cost drivers in the comp system. This is true nationally as well as in California.

In our system there is always a challenge to deliver quality care to injured workers at a reasonable cost. Ultimately, if medical costs rise too quickly then there is little room for increase in indemnity benefits for disabled workers.

The Schwarzenegger DWC regime is down to its' last few weeks. While there will undoubtedly be some holdovers, new leadership will be coming. That new team will ultimately craft a final version of these hospital and ambulatory surgery fee schedule regs.

And the new team will have to deal with a very contentious issue among doctors, a revision of the physician fee schedule.

According to the DWC:

"These regulatory proposals move the DWC closer to completing its 12-point plan to help contain medical costs. Four of the 12 points (tightening treatment guidelines, providing an option to keep medical care in a network, simplifying medical provider network rules and improving medical cost reporting) have been completed. A fifth point (implementing electronic billing) is very near completion.

With implementation of these two regulations, seven of the 12 points will be complete. DWC has also begun work on its plan to streamline utilization review processes and requests for medical authorization.

The final points of the plan, including updating the physician fee schedule, creating pharmacy networks and considering creation of a drug formulary, will be reviewed in the coming year."