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Cost concerns arise over California medical-legal fee proposal


Workers compensation payers and physicians are concerned about California’s Division of Workers Compensation final proposed medical-legal fee schedule changes released last week, which would substantially overhaul the current reimbursement system.

The medical-legal fee schedule, which has not been updated since 2006, outlines required reimbursement to qualified medical evaluators tasked with evaluating workers’ continuing eligibility for workers compensation benefits.

For the past 15 years, QMEs have been paid an hourly fee — generally starting at about $250 an hour — to review medical records, write medical-legal reports and testify in trials.

Under the proposed changes, which have been submitted to the California Office of Administrative Law for approval, QMEs will receive flat fees and an additional $3 per page for reviewing records in excess of 200 pages. Under the proposal, a QME hired to conduct a comprehensive medical-legal evaluation will be paid $2,015, plus the per-page fee if applicable. Experts say costs could soar.

“Everyone acknowledged that doctors were being underpaid … but this is a totally different system,” said Dr. Steven Feinberg, a pain expert and founder of the Palo Alto, California-based Feinberg Medical Group. “There are some unintended consequences that may be significant.”

The biggest issue of contention is the per page fee because up to about a third of records typically sent to a QME physician are duplicates, he said.

Payers are going to have to “either pay substantially more or revise the way they do things,” said Dr. Jacob Rosenberg, medical director of IPM Medical Group Inc. in Walnut Creek, California and president of the California Society of Industrial Medicine and Surgery. He said payers will often electronically send over thousands of pages of records — many inapplicable — for physicians to sift through.

“Big medical providers are very thorough and put out a lot of records. Even for pretty simple (injuries), you’re going to hit 200 pages pretty quick,” said Jeff Adelson, Newport Beach, California-based co-managing shareholder of Adelson McLean APC and a long-time workers comp defense attorney. “It’s not unusual for me to see cases with thousands of pages of records. If you send every record you have, whether its relevant or not … you can eat up $15,000 to $20,000.”

Stacy Jones, senior research associate at Oakland-based California Workers Compensation Institute, said payers are very concerned about the per-page fee because there currently “isn’t any way to adequately address the duplications because the records come from two different directions.”

If defense and applicant attorneys outlined exactly what records each party would send to the QME upfront, it could reduce the likelihood of duplications and an excessive bill, Mr. Adelson said.

“A lot of carriers don’t want to pay their attorney to review medical records … they have tended to just throw everything in an electronic file and send it,” Mr. Adelson said. “The time for just doing a document dump, that part has got to be over.”

Dr. Rosenberg said he is hopeful that the per-page fee will drive payers to determine which records are important. “They could pay someone on their end $30 an hour to sort the records,” he said.

Another issue is the lack of quality control measures in the proposed fee schedule, Ms. Jones said. When a workers comp evaluation is requested, the attorneys are presented with a panel of three QMEs to choose from — each eliminates one physician and the remaining one performs the evaluation.

“In workers comp, you’re stuck with the QME you get — some are very good, many are not good at all,” Dr. Feinberg said.

A bad report can result in an inadequate or excess award, but most often, it takes longer to resolve the claim, which negatively impacts the injured workers, Ms. Jones said.   

“(The DWC) really do have to have some type of quality piece,” she said. “One of the moves that the division is starting to make is to set up a committee to try to review the quality of the reports. There’s no benefit to having underqualified or poorly working physicians in a system.”

The DWC did not return requests for comment. If the current proposal is approved by the Office of Administrative Law, it will take effect on April 1.