WC Networks Cost Texas Employers According to WCRI
WC Networks Cost employers in Texas. Did Texas make a large inadvertent mistake? WCRI recently completed a study CompScope™ Medical Benchmarks for Texas 14th Edition,. One of the conclusions of the study was the growth in medical payments per workers’ compensation claim in Texas was faster than in prior years and more rapid than in most other states in the study.
The study found fee schedule increases following Medicare updates as required under HB 7, and the 2011 ban oninformal networks drove an increase in prices for medical services, fueling the recent growth in medical payments. A decrease in utilization of non-hospital care slightly offset the increases in prices. I thought I would explore the ban on informal networks. The statutes are included below. The directions from the Texas Department of Insurance (TDI) were for companies that may be an informal or voluntary network to compare themselves to the below law to see if they were either type of network.
My apologies if the statute did not line up properly. After reading over the Statute and then examining the cost/benefit analysis, one has to question whether this was a good idea.
I am thinking the law was enacted to protect the pharmacies from receiving “stacked” network reductions where the pharmacy charges are reduced multiple times by networks unknown to the pharmacy at the time the medications was dispensed to the injured worker.
Many WC medical providers have become very vocal over “quiet network” reductions and have filed suit or complained vociferously to the WC Board or Commission in their respective states.
If I happen to be off-base with my conclusion, Texas blog readers, please let me know.
(2) “Voluntary network” means a voluntary workers’ compensation health care delivery network established under former Section 408.0223, as that section existed before repeal by Chapter 265 (H.B. 7), Acts of the 79th Legislature, Regular Session, 2005, by an insurance carrier for the provision of pharmaceutical services.
(c) Notwithstanding any other provision of this title, including Section 408.028(f), or any provision of Chapter 1305, Insurance Code, an insurance carrier may pay a health care provider fees for pharmaceutical services that are inconsistent with the fee guidelines adopted by the commissioner only if the carrier has a contract with the health care provider and that contract includes a specific fee schedule. An insurance carrier or the carrier’s authorized agent may use an informal or voluntary network to obtain a contractual agreement that provides for fees different from the fees authorized under the fee guidelines adopted by the commissioner for pharmaceutical services. If a carrier or the carrier’s authorized agent chooses to use an informal or voluntary network to obtain a contractual fee arrangement, there must be a contractual arrangement between:
(ii) the start date and any end date of the period during which any person, other than an injured employee, to
which the network’s contractual fee arrangement with the health care provider is sold, leased, transferred, or conveyed; and
(1) the fifth day after the date the notice is mailed via United States Postal Service; or
(B) does not include a specific fee schedule consistent with Subsection (c); or