TESTIMONY OF ROBERT GOLDBERG, DO

MEDICAL SOCIETY OF THE STATE OF NEW YORK

AT A HEARING HELD BY THE

NYS ASSEMBLY LABOR AND INSURANCE COMMITTEES

DECEMBER 19, 2014

Good morning.  My name is Dr. Robert Goldberg.  I am a physiatrist in Manhattan and Dean of the Touro College of Osteopathic Medicine.  I am also a past-President of the Medical Society of the State of New York and a member of its Board of Trustees.  On behalf of MSSNY, I wish to express to you our appreciation for hosting this hearing today to receive testimony regarding the potential impact of proposed changes to the New York Workers’ Compensation Medical Fee Schedule as set forth in its July “Discussion Document”

Let me state at the outset that we commend the Workers’ Compensation Board for their efforts to re-engineer New York’s often-criticized Workers’ Compensation program with one its chief goals to expand injured workers’ access to care by bringing new physicians into the program or bringing back physicians who have previously dropped out.  And we greatly appreciate the Board’s solicitation of comments from and participation in meetings with the physician community to better assure that the goals of this transformation are met

I have worked with Chairman Beloten and other dedicated Board staff for many years on a wide variety of programmatic initiatives to improve and expedite medical care delivered to injured workers.   I know that he like MSSNY is very concerned about making sure that injured workers in New York State have access to a wide array of quality physicians to provide timely needed care so as to facilitate their ability to return to work. 

At the same time, we have also expressed to the Board that critical to the effort of re-shaping the Workers’ Compensation program is making sure that we avoid taking steps, such as large payment cuts or imposing significant new administrative burdens, that could undermine these transformative efforts and drive quality physicians away from the program, particularly those physicians who are currently devoting a substantial portion of their practices to the care and treatment of injured workers.

Specifically, at several meetings we articulated to the Board our significant concerns that the proposal as set forth in the actual “Discussion Document”, while potentially incentivizing certain physicians to participate in the program, could also trigger enormous cuts to other physicians which are equally essential to delivering injured workers’ health care.   We strongly agree with its goal to increase payments to physicians who have been historically underpaid, like primary care physicians, which are sorely lacking in Workers Compensation due to the significant paperwork and administrative hassles coupled with low payments.  However, the “Discussion Document” proposal would also produce huge and immediate cuts that would likely reduce participation of many specialist physicians to whom primary care physicians would likely refer many of their injured worker patients.

To be clear, we understand the difficult situation facing the Board about the need to transition away from its existing fee schedule, which is difficult to update due to the Ingenix database (which was owned by United Healthcare) being shut down a few years ago after Ingenix was found by then-AG Cuomo to have inappropriately manipulated its database to eliminate higher charges. 

We have also indicated that we do not per se object to using a fee mechanism based upon the Resource Based Relative Value System (RBRVS) format such as one used by Medicare, but the “conversion factors” that are set forth in the “Discussion Document” to determine actual payments are set far too low.   One reason for this problem is that physicians have for years been pushing Congress to get rid of the Sustainable Growth Rate formula, otherwise known as SGR, that every year threatens huge cuts to Medicare fees, and has kept an artificial constraint on the Medicare conversion factor.  This unsustainable SGR formula has basically kept Medicare physician fees at the same level for the last dozen years despite the huge increase in the overhead costs of running a medical practice.  While hospitals and nursing homes get market based increases every year in Medicare to keep up with rising overhead costs, physicians have to basically beg Congress to just keep our fees at the same level.  And to make matters worse, several specialists have seen huge drops in their Medicare fees.

We are aware of some states like California that have converted their medical fee schedule to an RBRVS system similar to Medicare, but have used conversion factors set at levels far above that proposed in New York that minimize the abrupt changes in fees arising from this transition. 

In particular, we have heard from many effected specialty care physicians, including orthopedists, radiologists and neuro-muscular experts (basically those physicians whose patient bases include a substantial number of injured workers) that the July “Discussion Document” proposal as written would cause huge and immediate cuts that would likely cause many of them to be unable to participate in the program. This of course would produce serious access to care problems for injured workers, which we cannot imagine would be wanted by anybody.

Our physician survey conducted this past summer revealed that ¾ of the responding orthopedic surgeons indicated that the cuts as proposed in the Discussion document would cause them to be less likely to treat injured worker patients.  And we are aware that surveys created by the New York State Society of Orthopedic Surgeons that have concluded that an even greater percentage of orthopedic surgeons indicated that they would be less likely to treat WC patients.

REFORM EFFORTS

Again, we applaud the Board for taking a comprehensive, “top to bottom” review of the often-criticized Workers Compensation program and to that end, we have indicated to the Board that we are supportive of numerous goals of its Re-engineering process, including its goals to:

  • Improve timely first payment of indemnity benefits.
  • Facilitate the delivery of appropriate medical care faster.
  • Improve the process for reporting medical treatment.
  • Reduce the administrative burden on medical providers and other stakeholders; and
  • Reduce reliance on paper forms.

These are all problems which deter many physicians from participating in Workers Compensation and most importantly interfere with injured workers receiving timely needed care.

We welcome the WCB’s proposal to create a new “medical portal” for submitting claims to carriers that will facilitate greater oversight by the Board, and reduce the haphazard paper reporting process of injuries and payments.  Workers Comp has become far too hassle-filled for many physicians to justify continuing participating in the program.  Frankly, we wish some of the focus of this hearing was on the carriers’ contribution to the problem of inadequate physician participation since, too often carriers ignore our submission of claims, or unfairly reduce payments, leading to unnecessary frictional costs for the program.   Certainly, we believe a new “medical portal” overseen by the Board holds the potential to remediate some of these claim hassles over time.

We like to believe that these extensive administrative hassles are a major reason why, at least for some physician services, the fees exceed typical commercial and Medicare rates.  Filing claims on behalf of injured workers is much more complicated than traditional claims to commercial, private, Medicare, or Medicaid health plans.  As such, for many services performed on injured workers, the fee schedule for NYS Workers’ Compensation has been traditionally higher than health plans insofar as it has been a tool to entice practitioners to participate in the program and to ensure an expedient return to work by the injured worker.

For example, when filing a claim to Medicare, the physician needs to provide his/her identifying information, patient information, the AMA-CPT(s) and the diagnostic code(s).  However, when filing a claim to the WCB, the physician does that, but provides essential demographic, historical, descriptive, correlative and prognostic services as well.  In addition, the claim(s) needs to be sent to the WCB, the WC carrier and the patient and/or the patient’s legal representative, if represented.   And the physician then needs to be prepared to wait months and months to be paid if it is contested claim.

We have heard estimates from national organizations that the average Workers Compensation claim takes 2.5 to 3 times as much administrative effort to receive payment as a Medicare claim.  And physicians can wait months on end to be paid for a health care service waiting for a claim to be finally resolved.   Our own recent surveys have demonstrated that:

  • Over 80% of responding physicians indicate that treating injured workers takes at least twice the time as other patients, and over 40% indicate that it takes more than double the time;
  • Nearly 90% of responding physicians indicate that administrative tasks associated with treating injured workers, for physicians and their staff, take at least double the time, with nearly 60% indicating that it takes more than double the time.
  • Nearly 75% of responding physicians indicate that Workers Compensation claims take a least twice as long to be paid as non-WC claims, with 46% indicating that it takes more than twice as long; and
  • Over 50% of responding physicians indicate that Workers’ Compensation claims are paid “significantly less often” than non-WC claims

It is for these reasons that a comparison of Medicare to Workers Comp is the proverbial comparison of “apples and oranges”.

Moreover, we would note that, despite the conclusion in the report that many services are overpaid in the New York Workers’ Compensation program, a recent report by the Workers Compensation Research Institute indicated that payments to New York physicians for WC were actually, on average, among the lowest in the country.  This is despite the growing costs faced by all practices to comply with mandated regulations, administrative burdens, technology and personnel requirements, enormous medical malpractice premiums and other overhead costs paid by New York physicians when compared to other states.  These changes are forcing many physicians to shut their practices altogether, becoming employees of hospitals, which threatens continuity of care with their patients.

Threats in Access to Care

There is also ample evidence from other states that significant cuts in the Workers’ Compensation fee schedule greatly reduces injured workers’ access to care.  For example, data from the American Association of Orthopedic Surgeons (AAOS) shows that in Hawaii and West Virginia, two states that markedly dropped their WC fees, less than 25% of orthopedists in those states participated in Workers Compensation.  In Texas, the number of orthopedists who limited their Workers Compensation patients went from 29% in 2002 to 77% in 2004, after dramatic changes in their fee schedule. We urge the Workers’ Compensation Board to heed the predictors of other states as it contemplates and implements change to avoid lengthy delays in necessary treatment of injured workers.

And there is historical precedent for physicians leaving the Workers Compensation program in response to significant programmatic changes. A few years ago, implementation of burdensome new C-4 medical reporting forms generated an access crisis for injured workers in the Rochester region of the State when numerous physicians dropped out of the program in responseThey believed that the hassle, both in terms of paperwork and also huge delays in getting paid, did not justify what they were being reimbursed in the program.  Indeed, as noted previously, our surveys have detailed that many surgeons have expressed concerns that steep cuts in WC fee schedule could make it impossible for them to continue to participate in the program.

Again, we greatly appreciate the Board’s efforts to improve New York’s Workers’ Compensation program and are pleased to work with them and you to effect change that will reduce many of the administrative hassles associated with participating in the workers compensation program and monitoring payor compliance.  However, as we noted in a letter sent by MSSNY and 9 specialty societies to the Board, the “Discussion Document” as proposed does not provide an adequate methodology for assuring a compensation model that is rationale, equitable and likely to produce the comprehensive provider panel necessary to provide the full range of care which WC patients deserve and have the right to expect. 

In our meetings, the Board has appeared to recognize the legitimacy of our concerns and has seemed to be willing to revise its proposal to attempt to address these concerns.  It is our hope that an alternative model for WC fees will be developed that brings more primary care and other physicians into the program without hurting participation from physicians who are currently providing care to many injured workers.   Certainly, as we noted previously, a transition to RBRVS would potentially be workable if conversion factors were set at levels to prevent huge cuts in payments while at the same time assuring fair payments to encourage primary care physicians to participate.  Moreover, we have also suggested that the Board look at using the Fair Health database as a template for fees for medical care since it is based upon actual charge data from physicians.  

But to be clear, we need to be sure that we do not jeopardize our patients’ access to needed care by implementation of policies that produce huge immediate cuts that would leave many physicians with no choice but to avoid participation in Workers Compensation.

We again thank the State Assembly for their request for input from injured workers, their representatives and physicians regarding these proposed changes.  I am happy to answer any questions you may have.

EXAMPLES OF PHYSICIAN COMMENTS FROM MSSNY SURVEY:

“The paperwork associated with WC is excessive. Carriers use out of state reviewers who use non NY guidelines to down code and apply edits, reducing or denying payments. There is no recourse without needing additional manpower and time to appeal the denials. Invariably, the additional overhead cost negates any additional reimbursement that may be received. We end up writing off

amounts rather than spending additional time and money trying to fight the carrier. The burden of documentation required for office visits is much more than that required for non WC patients as the narrative requires additional medicolegal documentation to support the multiple issues that need to be

addressed in addition to the medical care.”

 

“Medicare already underpays but with the additional administrative burden of WC cases, my practice is very likely to stop seeing WC patients if the fee schedule changes for Electrodiagnostic testing which is my primary focus. Unfortunately we already have a severe deficit of providers willing to see these patients and the fee schedule change will make it less likely that specialists like myself will see them at all.”

 

“WC pts require significant more time, patience, and medical care compared to the non-WC pt. WC administrative tasks are very burdensome, time consuming, and full of loop holes. Even after completing all the requirements, payments are low and often not made at all. Then there's the administrative burden, time and resources to follow up on all the non-payments and under payments. A small practice cannot sustain itself with a Medicare based WC fee schedule. Ultimately these WC pts will not have any physicians to see as we will most likely go non-par with WC--most likely the outcome WC wants to have in the end, at the expense and detriment to their own patients.”

 

“Will VERY strongly considering discontinuing seeing WC patients if reimbursement is decreased. It is simply not cost-effective and quite frankly, not rewarding. The 'hassle factor' is barely offset by the present reimbursement rates. Add in the across-the-board poorer outcomes in this population and it is, generally speaking, an undesirable duty to provide care to these patients. Secondary gain is rampant. There will continue to be an exodus of caregivers if reimbursement is decreased .and that is a cold, hard, fact. It will simply be 'not worth it' on many levels.”

 

“Worker's compensation patients are often more complicated than the typical Medicare patient with complex injuries. Also, the expectations of the patients are different and can be more difficult and time consuming to manage. Every intervention requires an exhaustive approval process and my staff spends a significant amount of time with C-4 forms, etc. I often need to have extra visits for no other reason than to document degree of disability.”

 

“If the present rates for WC are cut to the proposed level then it will no longer make any sense to employ the extra staff, deal with the admin. burden and inefficient WC system. All that will change will be the reimbursement. I will no longer participate in WC as it will be work that will occur at a loss financially.

This will also affect NF rates potentially and that will put further strain on fragile office expense/profitability issues.”