Texas is getting a lesson in state independence.
Like many workers' compensation systems, Texas has tied its medical treatment reimbursement schedule to Medicare's schedule.
The Texas Division of Workers' Compensation issued a memo on June 17 that its medical fee guidelines require the use of Medicare billing policies and it was legally required to implement the Centers for Medicare and Medicaid Services' new rule requiring physical therapists, occupational therapists and speech pathologists to use "G-codes" on their medical bills.
That new rule took effect on July 1.
Texas providers are concerned that, because some providers don't bill Medicare they will need to pay for expensive upgrades and may be forced to resort to paper billing in the interim before billing systems are compatible with the Medicare billing rules.
Mary Daulong, the chairman of the payment policy committee for the Texas Physical Therapy Association, told WorkCompCentral that physical therapists who specialize in Medicare patients had plenty of notice to prepare for the requirement and recently completed a six-month trial period that ended on June 30.
Conversely, physical therapists who specialize in workers' compensation patients did not anticipate having to comply with the requirement, because they believe that the G-codes are largely unrelated to workers' compensation, she said. As a result, the DWC memo requiring use of the G-codes in the Texas workers' compensation system came as a surprise to some physical therapists.
Because of the late notice, physical therapists who specialize in workers' compensation patients may have billing software that is incapable of plugging the G-codes into a bill. Physical therapists with incompatible software would need to modify their systems to comply with the rule and may have to resort to paper billing until they do.
The software upgrades are being estimated at between $10,000 to $80,000 - that's a lot of dough for a small business like most physical therapy practices.
The Texas DWC could choose to closely audit and punish providers and payers who do not comply with the G-code requirement. DWC would not comment to WorkCompCentral whether it intends to strictly enforce compliance, stating only that, "The memo posted on June 17 correctly states that the new CMS billing and reporting requirements became effective July 1, 2013, and as a result, also apply to services furnished on Texas workers’ compensation claims on or after July 1, 2013."
The question is applicable to payers as well as providers - payers also have to process these bills in a timely manner according to the law to avoid penalty.
The Insurance Council of Texas is warning carriers to prepare for an increase in paper billing and to ensure that systems are prepared for, and people educated about, G-code billing.
So there you have it - tightly integrating one system into another can pose problems when the law dictating that integration is interpreted inflexibly.
Whether or not this particular problem escalates into a systemic issue depends upon the level of cooperation of two, generally, disparate factions: providers and payers.
Trey Gillespie, senior workers' compensation director of the Property Casualty Insurers Association of America, commenting on the issue to WorkCompCentral said, "The desire on everybody's part is that timely services will be provided and paid for."
If that theme indeed carries through, then this is much ado about nothing other than playing out another scene in the screenplay for "Unintended Consequences."