Challenging Pharmaceutical Bills in New York

Workers’ Compensation insurance provides medical treatment which is causally related to the work injury or illness.  It is important to monitor the medical treatment to confirm the treatment provided is medically necessary and directly related to the original injury or illness.  Medicals should be monitored during the entire duration of the pending claim and even after the claim settles by way of an “indemnity only” Section 32 Agreement.  When appropriate, the carrier must object to the treatment in a timely manner.  This article will focus on how to properly object to medical treatment provided, specifically, a pharmaceutical prescription.

Generally, when a pharmacy submits a claim to the carrier for the cost of the prescribed medicine, the insurance carrier must pay the amount set forth in the Pharmacy Fee Schedule within 45 days of receipt of the claim.

However, if the claim has not been established or if the prescribed medicine is not for a casually related condition, the carrier must file a timely objection.  The carrier must notify the parties of its objection by filing a C-8.1 within 45 days of receipt of the bill.  The C-8.1 form is used if the carrier objects to the length or type of treatment or the billed amount. [Link]  The objection form is designated into two separate types of objections, allowing the carrier to object to both future treatment and treatment which was already provided to the claimant.IMGP0243

C-8.1 Part A is an objection to further treatment or future treatment.   This part should be completed and filed with the Board within 5 days after termination of treatment or refusal/denial of future treatment.

C-8.1 Part B is an objection to payment of a bill for treatment already provided.  The carrier must object to the bill within forty-five days of submission of the bill, providing reasons for the objection.

It should be noted that insurance carriers may contract with a pharmacy to provide prescribed medications to injured workers.  The pharmacy must be within a reasonable distance from the claimant or offer a mail order service.  If such a relationship is established between the carrier and pharmacy, the insurance carrier may require injured workers to obtain their prescribed medicines from the designated pharmacy. The carrier must provide the injured worker with notice which includes the contact information of the pharmacy and instructions on how to obtain prescribed medicines.

If a non-approved pharmacy submits a bill, the carrier should properly file a C-8.1b within 45 days of submission of the bill.

Hypothetical:

You are handling a claim with the following set of circumstances:

  • An employee broke his neck during the course and scope of his employment;
  • The carrier provided the injured worker with the contact information of XYZ PHARMACY and instruction on how to obtain prescribed medications;
  • The claim was established to the neck, only.

Issue:

ABC pharmacy submits a bill for a compound RX which is not within the Medical Treatment Guidelines for treating the neck.

Proper Procedure:

In this case, the carrier should file a C-8.1b.  Based on the above hypothetical circumstances, the basis of the denial would include 1) ABC Pharmacy is not the approved pharmacy for the carrier; 2) the treatment provided was not based on correct application of the Guidelines; and 3) the treatment deviates from Guiltiness without securing a Variance.

If you have any questions about this article or this topic, please do not hesitate to contact Tatyana Redko at tredko@lois-llc.com.

Join In the Learning!

Register for our monthly webinars on New York workers’ compensation law, by clicking here. Sign up for our monthly newsletter here.

The New York Handbook

Our webinar series was designed as a complement to our New York Workers’ Compensation Handbook. The Handbook is written in “plain English” and provides a resource for risk managers and claims professionals who need a complete and easy-to-use reference guide for handling New Jersey claims.

Digital editions of our book on New York workers’ compensation defense are available for download (FREE) here:
New York PDF link: bit.ly/nywcpdf
New York ePUB link: bit.ly/nywcepub
New York Kindle link bit.ly/nywckindle

Defending Employers in New York, New Jersey, and Longshore.