Lawmakers Intent on Tinkering With Work Comp This Session

Wednesday, January 25, 2017 | 0

New York lawmakers have proposed a slew of workers’ compensation bills, including legislation to force prompt payments to pharmacists, require every hearing office to have videoconferencing technology, and make it easier for employers to withdraw from the New York State Insurance Fund.

Pharmacists on Tuesday applauded Assembly Bill 15, which would add their industry to a law that requires employers to pay physicians and self-employed occupational therapists within 45 days of receiving bills. The law would require employers to notify pharmacies within 45 days why their bills can’t be paid in full or in part.

Senate Bill 850 would require all Workers’ Compensation Board district offices to be equipped with videoconferencing technology and allow that technology to be used for any action brought before the board.

Attorneys on both sides said they oppose S850 because so much of what is said during proceedings would be lost in translation, reducing their ability to negotiate and communicate.

S428 would remove the 30-day advance notice requirement and allow employers to withdraw from the New York State Insurance Fund as soon as they provide written notice of their intention to pull out, and demonstrate they have secured a new policy.

The New York Insurance Association has pushed S428, claiming NYSIF has an unfair competitive advantage. NYSIF is the carrier of last resort for New York employers that can’t secure workers’ compensation policies on the private market. But it has grown to hold a 46% share of the state’s comp market.

NYSIF spokeswoman Betsy McCormack emailed Tuesday, “NYSIF does not comment on pending legislation.”

A697 would give public entities the option of joining public self-insurance groups for their comp coverage to lower their costs and better manage their public employee risks. It would subject public group self-insurers to virtually all of the same requirements that govern private group self-insurers and would give regulatory authority to the WCB.

The year-long legislative session convened Jan. 4. Some of the measures were introduced last year but failed to pass, including the bill that seeks to speed up payments to pharmacies.

A15 also would allow the WCB to appoint a licensed pharmacist to determine the value and liability of disputed bills if an employer notifies the provider why it hasn’t paid the bill in full or in part within 45 days of receiving it.

Absent the employer notifying the provider within 45 days, pharmacists can ask the WCB to make awards consistent with established fee schedules.

“It’s always a challenge getting paid, and putting in prompt-payment provisions the way other providers have, it would be a benefit to pharmacies,” said Ken Martino, chief executive officer of the Injury Workers Pharmacy, a national home delivery pharmacy based in Methuen, Massachusetts.

“They’re trying to address the broader issue of pharmacists not being considered providers in New York so they don’t have the same abilities as physicians to collect on their outstanding bills,” Martino said. “Pharmacists should be treated the same as any other medical provider within the statute.”

George Rontiris and Peter Levis, co-owners of Titan Pharmacy in Astoria, New York, said a similar measure failed to pass last year and that they expect this bill to also fail.

What’s really needed, they said, is for New York to change its rules and allow injured workers to pick their own pharmacies and not force them to use those designated by carriers.

“What’s really needed is an open network so workers can use the pharmacy of their choice,” Levis said.

Levis and Rontiris both said New York should adopt a closed formulary with an open network, as Texas has done. They said many of their customers use their spouses’ private health insurance to obtain their medications to avoid hassles with workers’ comp carriers.

“Some of our patients just give up,” Rontiris said. “There’s cost shifting from workers’ comp to private insurance or state plans. It’s so frustrating trying to get your meds authorized by workers’ compensation.”

Kathy Febraio, executive director of the Pharmacists Society of the State of New York, said she has not heard extensive complaints from members about not getting paid in a timely fashion.

“But it’s good to be in alignment with the other health care providers in the workers’ compensation system,” she said.

Farmingdale claimants’ attorney Robert Grey said the measure raises questions of why pharmacists are not getting paid promptly, and that it might be caused by the increasing use of utilization review and nurse case managers to block prescriptions.

“When pharmacists don’t get paid, then they refuse to provide medications to injured workers,” he said. “So we are in favor of improving the process for pharmacy payments.”

A15 was referred to the Labor Committee on Jan. 4. No hearings had been scheduled as of Tuesday afternoon.

The videoconferencing bill, S850, is another idea that the Legislature has kicked around in the past. Some claimants’ and defense attorneys oppose the measure because they say videoconferencing depersonalizes the hearings process.

“Injured workers should certainly have access to a hearing when there is an issue in their case, but the quality of the hearing is very different when everyone is in the same place,” Grey said. “When the judge is just a face on a TV screen to the injured worker, or the injured worker is just an electronic file to the judge, important context gets lost.” 

Buffalo defense attorney Damon Gruber said the proposed technology would rob injured workers of face time with lawyers and eliminate attorneys' ability to negotiate a host of issues, such as degrees of disability or settlements.

“A lot of that stuff is done there,” Gruber said. “We would lose that ability to communicate and resolve those issues.”

Buffalo defense attorney Todd Jones said videoconferencing would eliminate the “staging elements” that often tell their own story.

“You want a judge in the room with a claimant a lot of the time, particularly where the degree of disability is in question. Being able to watch a claimant walk into a room is taken away when they can just Skype into a hearing from their attorney’s office,” Jones said. “You’re really only going to be able to see what the claimants’ attorney wants you to see.”

S850 was referred to the Senate Labor Committee on Jan. 5.

S428 would remove the advance notice requirement before employers could dump NYSIF for another carrier.

The New York Insurance Association and the Professional Insurance Agents of New York State are pushing the legislation because they say current law locks in their policyholders, and costs them money to withdraw and move to a private carrier that might offer a better deal.

NYIA did not answer an email Tuesday, but President Ellen Melchionni told WorkCompCentral on Jan. 4  that several legislative changes are needed “to level the playing field between what is intended to be the market of last resort and the private insurance market."

The 30-day notice currently required of employers “provides SIF with ample time to retain the business — time that is not afforded to private carriers,” she said. “SIF has an unfair competitive advantage and routinely writes business that could be readily placed within the voluntary market.”

Grey, who chairs the New York Workers’ Compensation Alliance, said S428 is just the latest salvo in the insurance industry’s effort to “undermine” SIF.

“In our view, the SIF is the least expensive and most effective option for employers to obtain workers’ compensation insurance and, in general, handles claims more efficiently than private carriers,” he said. “The goal should be to create rules that require private carriers to be as transparent and cost effective as the SIF, not to change the law to drive up the SIF’s costs to make it look more like a private carrier.”

S428 was referred to the Senate Small Business Committee on Jan. 9.

Several other workers’ comp-related bills that have been introduced this session.

• A86 would prevent fraud by ensuring through productive audits that all employers are appropriately classified.
• A606 would prevent employers with a demonstrated history of strong compliance with state and federal laws from being placed on the Workers’ Compensation Debarment List over a first-time administrative violation.
• S583 provides that a claimant be deemed to have a permanent total disability when he or she has been approved for federal Social Security disability benefits substantially as a result of a compensable injury or illness.
• S833 would create a task force to study the use of telehealth within the system.
• S847 would allow an employer who applies to the Department of Labor to be exempted from covering employees whose religious tenets or teachings oppose the acceptance of any insurance benefits.

The American Insurance Association is more focused on New York’s regulatory front than legislation and backs the WCB’s proposal for a closed formulary as part of its Pharmacy Benefit Plan, said AIA Northeast region Vice President Alison Cooper.

“Additionally, we’ll be working to support other provisions of the Pharmacy Benefit Plan, including restricting physician dispensing of medications, limiting the maximum days’ supply standards for opioids and narcotics, and placing restrictions on drug repackaging,” Cooper said via email.

“All of these measures have proven effective at lowering costs. However, they more importantly have proven effective at combating opioid abuse in the workers’ compensation system,” she said.