Reimbursement must ensure quality care, effective cost control

In Texas, reimbursement for services not identified in an established fee guideline are reimbursed at fair and reasonable rates that are designed to ensure the quality of medical care and achieve effective medical cost control.

Case name: Vista Healthcare, Inc. v. Texas Mutual Insurance Co., No. 03-09-00178-CV (Tex. Ct. App. 08/26/10).

Ruling: The Texas Court of Appeals held that the workers' compensation law that commanded fair and reasonable rates was valid and that an ambulatory surgical center was not entitled to additional reimbursement from an insurer.

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What it means: In Texas, reimbursement for services not identified in an established fee guideline are reimbursed at fair and reasonable rates that are designed to ensure the quality of medical care and achieve effective medical cost control.

Summary: A physician for an ambulatory surgical center administered epidural steroid injections to a workers' compensation claimant at its facility. The center billed the insurer more than $5,500 for its services. The insurer reimbursed the center only $400, basing its reimbursement methodology on Medicare payment rates. At the time the center provided the services, medical fee guidelines for ambulatory surgical centers had not yet been adopted. The center and the insurer disagreed as to the amount of reimbursement. The Texas Court of Appeals held that the center was not entitled to additional reimbursement.

At the time the center provided the services, Texas rules stated that reimbursement for services not identified in an established fee guideline shall be reimbursed at fair and reasonable rates. The center asserted that it was entitled to its "usual and customary" charges -- that is, what it would charge non-workers' compensation payors for the same services. The court stated that the standards explicitly included the requirement that the rates be "designed to ensure the quality of medical care and achieve effective cost control."

The center also argued that the rule was unconstitutionally vague. The court stated that the terms could not be given exact definitions because reimbursement methods are fact-specific and made on a case-by-case basis. The language was similar to language that courts have held is constitutional. The center was not entitled to any set amount of reimbursement.

Read more at the WorkersComp Forum homepage.

November 29, 2010

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