New York has announced the implementation plan for the new drug formulary.
Which New York Cases Are Impacted?
This new drug formulary will effects ALL CASES and ALL CLAIMS in New York. It’s actually great news for employers because it limits the drugs that physicians can prescribe. Think of the drug formulary as a sort of companion/extension to the Medical Treatment Guidelines. The formulary is AUTOMATIC and MANDATORY. After December 5, 2019 payers can object to provider prescriptions which fall outside the formulary.
How Does the Formulary Benefit Payers?
The formulary should reduce employer/carrier costs by eliminating or reducing the following five (5) prescription types:
A drug not listed on the Formulary,
A Formulary brand name drug, when a generic is available,
Combination products, unless specifically listed on the Formulary,
A brand name drug when a generic version of the same active ingredient(s) is a commercially available in a different strength/dosage, or
DECEMBER 5, 2019: The formulary becomes mandatory in every case on December 5th! All prescriptions written on or after that date MUST FOLLOW the formulary.
JUNE 5, 2020: The regulations (441.3) stated that all OLD prescriptions are void and as of 12 months form the effective date of the regulation (June 5, 2019) and therefore as of June 5, 2020 all drugs prescribed must follow the drug formulary.
Questions about the formulary?
Contact Greg Lois with any drug formulary questions you have regarding your New York workers’ compensation claims.
Effective April1, 2019, the Workers’ Compensation Board changed the Medical fee Schedule in effect for medical payer reimbursement in New York workers’ compensation claims. This will have a significant impact on the many Medical Provider Claims filed by New Jersey doctors and medical providers seeking reimbursement for services rendered to New York workers’ compensation claimants where the Jersey provider is demanding reimbursement at a much higher (“usual and customary”) rate than would be allowed under New York’s fee schedules.
The Changes to the Fee Schedule.
Changes to General Ground Rule 16 govern reimbursement for out-of-state treatment. The Rule now provides that a claimant who lives in New York State may treat with a qualified or Board authorized out-of-state medical provider when such treatment confirms to the Workers’ Compensation law and Regulations, the MTG’s and the Medical Fee Schedule. Payment shall be made to the medical provider as set forth herein and using the regional conversion factor for the zip code where the claimant resides.
How are fee schedule reimbursements determined?
Simple. The methodology for calculating medical reimbursement fees remains unchanged. Fee schedules are both region and activity-specific. To calculate a fee for a particular procedure:
Identify the appropriate conversion factor, which is listed within the respective Ground Rules document. There is a conversion factor for each geographic region and general type of medical service provided (e.g., surgery, radiology, etc.). For example, in the Medical Ground Rules document, you’ll find the conversion factor table on page 12.
Once you have the conversion factor you need, find the CPT code for the specific type of service you want to look up.
For each CPT code, there is a Relative Value Unit (RVU) listed.
Multiply the RVU by the conversion factor to calculate the fee for that service.
The New York Workers’ Compensation Medical fee Schedules now specifically address how providers who render treatment to New York residents out-of-state should be reimbursed. This means that a qualified out-of-state medical provider should be reimbursed (paid) at the rate applicable in the region where the claimant resides (in New York). The Board has continuing jurisdiction to resolve disputes between medical providers and insurers for out-of-state medical care and now has set forth a bright-line rule for how those providers will be reimbursed.
In a Board Panel Decision dated May 24, 2017, the Board found that the Medical Treatment Guidelines apply to the out of state treatment of a claimant residing outside of New York State. The decision in In Re Hospice is important because it reverses the Board’s previous statements that out-of-state treatment was immune from the application of the restrictive Medical Treatment Guidelines (“MTG”). This meant that New York claimants merely had to “cross the river” into New Jersey or any other state and obtain medical treatment and medications which far exceeded the treatment or medications allowed under the Medical Treatment Guidelines, needlessly increasing the costs in their cases. Now employers and carriers have a Board Panel decision supporting the argument that law judges should apply the MTG’s to out of state cases. Continue reading Medical Treatment Guidelines Apply to Out of State Claimants→