Changes to California's labor cost compensation schemes implemented in the spring could add another $ 270 million in medical costs to the state's workers' compensation system. Renewal of the reimbursement of the medical-legal fee schedule, which took effect March 1 and April 1, respectively, may not only affect the cost of evaluation and management visits and medical-legal reviews, they may also set the stage for abuse, say some experts  The Oakland-based Workers' Compensation Insurance Ratings Bureau last week presented its estimates of the fiscal effects of changes based on historical comp data, predicting that E&M changes, when adjusted for inflation, could increase costs by 1
"Overall, this is not very good news for California. compensation schemes for workers, and it comes just as small businesses and the economy in general are trying to recover from COVID, says Robert Hartwig, clinical associate professor and head of the Risk and Uncertainty Management Center at the University of South Carolina at Columbia.  Changes in compensation for E&M services, which account for about 15.9% of the total medical costs in California's labor system, including self-insurance, could have an estimated system impact of $ 170 million, WCIRB analysts say. The change in reimbursement for medical-legal review, which accounts for approximately 6.5% of total medical expenses, could have an estimated systemic effect of $ 100 million.
While E&M system increases are mainly due to changes in procedural codes, about 11% of the potential price increase in medical-legal reviews comes from a record review reimbursement review that has many advocates concerned. The previous schedule, which had existed since 2006, had paid QMEs an hourly fee. The new schedule, introduced by the California Division of Workers Compensation in February, will pay QMEs a fixed fee of $ 2015 for a comprehensive case review plus an additional $ 3 per page for all items exceeding 200 pages.
"I see a lot of potential friction costs in terms of how the fee schedule and the new procedures will be implemented," said Aaron Hemmings, a shareholder in Woodland Hills and Thousand Oaks, California, office of Stander Reuben's Thomas Kinsey APC, representing employers.
In the medical-legal review process, the plaintiff and defense counsel are intended in theory to agree on the medical records sent to QME, Hemmings said. However, these files tend to be extensive and contain duplicates and irrelevant records, he said.
"I think most people overestimate the level of cooperation between the parties," Hemmings said. "I hope I have proved myself wrong."
Defense attorneys, whose insurance or employer clients bear the costs of medical-legal reviews, may have the resources to send smaller files with aggregated pages to QME, while the appellant's attorneys generally have high burdens, lack staff to review extensive medical files, and have not the financial incentive to do so, says Jeff Adelson, Newport Beach, California-based co-owner of Adelson McLean APC.
"A doctor can get a set of 500 (pages for review) from one side, 500 from another, and maybe 400 pages will be duplicates," he says. “The price of what should be a simple result can be really high. A client must ask: & # 39; Is there really value in spending $ 15,000 to $ 20,000 on a medical report? & # 39;
The plaintiff's lawyers may use the fees per page as a "sword to try to threaten employers in higher settlement. amount – or meet several (medical-legal) evaluations at this increased cost, "said Hemmings. “I only see a large part of the burden that falls on the employers and the defendants … and the potential for abuse. We will see how everything develops. I think there will be a big change in how we do business.