1. Workers Compensation Medical Fee Schedule Overview Paul Smallcomb Client Service Manager Medical Group Business Services

2. Physician’s Fee Schedule 1999 Official Medical Fee Schedule Book 1999 Official Medical Fee Schedule Book All Physician’s Services All Physician’s Services Evaluation and Management Evaluation and Management Anesthesia Anesthesia Surgery Surgery Radiology- all service locations Radiology- all service locations Medicine Medicine Physical Medicine Physical Medicine Special Services Special Services

3. Current Physician Fee Schedule Evaluation and Management (E&M) codes increased in 2007 by 23% Evaluation and Management (E&M) codes increased in 2007 by 23% Last increase in most other codes was in 1984 and then most decreased in 2004 by 5% Last increase in most other codes was in 1984 and then most decreased in 2004 by 5% Use 1997 and 1994 CPT codes Use 1997 and 1994 CPT codes Charge based Charge based

4. Revising the Physician’s Fee Schedule UCLA study 1999: concluded Resource- Based Relative Value System (RBRVS) best alternative and will increase fairness UCLA study 1999: concluded Resource- Based Relative Value System (RBRVS) best alternative and will increase fairness In place for Federal Gov. for 16+ years In place for Federal Gov. for 16+ years Maintained by Centers for Medicare and Medicaid Services (CMS) Maintained by Centers for Medicare and Medicaid Services (CMS) Does not mean we’re going to “Medicare” fee schedule Does not mean we’re going to “Medicare” fee schedule

5. Ground Rules Will review all Will review all Examples Examples – Physical therapy –Second surgery –Correct Coding Initiative (CCI) edits

6. Components of RBRVS Physician work – 52% Physician work – 52% Practice Expense – 42% Practice Expense – 42% Professional Liability Insurance (PLI)– 4% Professional Liability Insurance (PLI)– 4%

7. Physician Work Time required to perform the service Time required to perform the service Technical skill and physical effort Technical skill and physical effort Mental effort and judgment Mental effort and judgment Psychological stress about iatrogenic risk to the patient Psychological stress about iatrogenic risk to the patient

8. Practice Expense Direct cost – actual equipment utilization rates Direct cost – actual equipment utilization rates Indirect cost - staff, equipment, supplies and expenses not just tied to the specific procedure Indirect cost - staff, equipment, supplies and expenses not just tied to the specific procedure

9. Lewin Group Using CWCI data Using CWCI data Model ground rules under OMFS and RVBRS Model ground rules under OMFS and RVBRS Crosswalk old CPT codes to new ones Crosswalk old CPT codes to new ones Analyze data Analyze data –Calculate payment-neutral conversion factor which does not mean that is what we will ultimately adopt

10. Decisions Multiple models Multiple models Ground rules Ground rules Conversion factors Conversion factors – Multiple or single – Payment level (s) Geographic adjustment factors Geographic adjustment factors

11. Most Recent Changes to Physician Fee Schedule For physician services rendered on or after February 15, 2007, the maximum allowable reimbursement amounts for procedure codes 99201 through 99205 and 99211 through 99215 are set forth in the February, 2007 Addendum To Table A, “OMFS Physician Services Fees for Services Rendered on or after February 15, 2007.” For physician services rendered on or after February 15, 2007, the maximum allowable reimbursement amounts for procedure codes 99201 through 99205 and 99211 through 99215 are set forth in the February, 2007 Addendum To Table A, “OMFS Physician Services Fees for Services Rendered on or after February 15, 2007.” The February, 2007 Addendum to Table A, “OMFS Physician Services Fees for Services Rendered on or after February 15, 2007”, sets forth individual procedure codes with the corresponding maximum reimbursable fees, is incorporated by reference. The February, 2007 Addendum to Table A, “OMFS Physician Services Fees for Services Rendered on or after February 15, 2007”, sets forth individual procedure codes with the corresponding maximum reimbursable fees, is incorporated by reference.

12. Changes to E/M Codes OMFS Section Procedure Code 5-14-05 OMFS Maximum 5-14-05 OMFS Maximum 2-15-07 OMFS Maximum 2-15-07 OMFS Maximum Increase Increase 1-01-07 Medicare Maximum E&M99201$39.10$39.902.1%$25.58 E&M99202$57.80$70.1921.4%$51.11 E&M99203$76.50$103.8635.8%$78.33 E&M99204$109.65$146.1233.3%$127.66 E&M99205$145.35$186.7328.5%$167.76 E&M99211$23.80$23.810.4%$9.78 E&M99212$35.70$42.0217.7%$26.17 E&M99213$47.60$56.9319.6%$48.72 E&M99214$72.25$89.5724.0%$77.24 E&M99215$110.50$129.4117.1%$111.75

13. Medicare Based Fee Schedules 120% of Medicare Rates Clinical Laboratory – updated annually Clinical Laboratory – updated annually DME – updated quarterly DME – updated quarterly –All suppliers: wholesale, retail, mail-order, provider Orthotics, Prosthetics and Supplies – updated quarterly Orthotics, Prosthetics and Supplies – updated quarterly Inpatient Facility – updated annually Inpatient Facility – updated annually Outpatient Facility – OPPS Schedule – updated annually Outpatient Facility – OPPS Schedule – updated annually – Hospital Outpatient Departments – Ambulatory Surgery Centers Ambulance – updated annually Ambulance – updated annually

14. Pharmacy Services Medi-Cal Based Fee Schedule Medi-Cal Based Fee Schedule –100% of Medi-Cal’s rates –Applies to anyone dispensing pharmaceuticals –Web based calculator –Database updated first day of each week. –Doesn’t include repackaged drugs

15. Medi-Cal’s Basic Formula The basic formula for reimbursement is 83% of AWP + $7.25 dispensing fee. The basic formula for reimbursement is 83% of AWP + $7.25 dispensing fee. Skilled Nursing Facilities are entitled to a $8.00 dispensing fee. Skilled Nursing Facilities are entitled to a $8.00 dispensing fee. Over-the-counter medication is paid per the formula with no dispensing fee. Over-the-counter medication is paid per the formula with no dispensing fee. Medical providers should provide the NDC number of the dispensed pharmaceutical Medical providers should provide the NDC number of the dispensed pharmaceutical

16. Where Are They Found? 1999 Official Medical Fee Schedule 1999 Official Medical Fee Schedule DWC’s web site www.dir.ca.gov/dwc DWC’s web site www.dir.ca.gov/dwc Medicare’s web site www.cms.hhs.gov Medicare’s web site www.cms.hhs.gov Medi-Cal’s web site www.medi- cal.ca.gov Medi-Cal’s web site www.medi- cal.ca.gov

17. Thank You Questions? Questions?