The CPT code book and CPT Assistant are admissible as a matter of course

Matter of Global Liberty Ins. Co. v McMahon, 2019 NY Slip Op 03692 (1st Dept. 2019)

This appears to be a very large issue in modern NY no-fault jurisprudence, as the coding of billings becomes the main issue in many arbitration. I was only zapped by this issue once, but once is enough. Despite the clear wording of the regulation and the Fee Schedule, I knew I was going to be at the First Department on this case.

Here is the substance of the case:

“The lower arbitrator, in rendering an award to respondent in that amount, refused to consider CPT Assistant, on which Global had relied, based on the arbitrator’s view that CPT Assistant was “not authorized by statute or regulation applicable to the No-Fault Law.” On Global’s appeal, the master arbitrator affirmed the lower arbitrator’s award. Thereafter, Supreme Court denied Global’s petition to vacate the award. On Global’s appeal, we reverse and grant the petition.

The Official New York Workers’ Compensation Medical Fee Schedule, promulgated by the chair of the Workers’ Compensation Board, directs users to “refer to the CPT book for an explanation of coding rules and regulations not listed in this schedule.” The CPT book, in turn, expressly makes reference to CPT Assistant. By both statute and regulation, the fee schedules established by the chair of the Workers’ Compensation Board are expressly made applicable to claims under the No-Fault Law (see Insurance Law § 5108; 11 NYCRR 68.0, 68.1[a][1]; see generally Government Empls. Ins. Co. v Avanguard Med. Group, PLLC, 127 AD3d 60, 63-64 [2d Dept 2015], affd 27 NY3d 22 [2016]). Accordingly, because CPT Assistant is incorporated by reference into the CPT book, which is incorporated by reference into the Official New York Workers’ Compensation Medical Fee Schedule applicable to this claim under the No-Fault Law, the award rendered without consideration of CPT Assistant [*2]is incorrect as a matter of law (see 11 NYCRR 65-4.10[a][4]) “

To me, the rule that I cannot reference the CPT Code book or the CPT Assistant was meritless. Apparently, this was another “Maslow rule” that a sizable minority of arbitrators held as gospel. You could find out who the arbitrator and master arbitrator was in this case as it is e-filed.

My angst here is not so much with the lower arbitrator as (s)he had a body of “law” to rely upon in coming to his/her decision. Why the arbitrators are so moved by Maslow rules of regulatory interpretation is a question I may never get an answer to (this is the second Maslow rule the Appellate Division reverse d- no easy feat), but I can live with the underlying lower arbitrator’s decision.

My problem here is with the master arbitration program. For starters, if you move from New York, you should not be a master arbitrator. Aren’t there plenty of New York attorneys with coverage backgrounds who can review arbitrator decisions? Second, if you find that Petrofsky blocks you from making legal determinations (or disguising factual issues and legal issues), then you should be appearing on traffic tickets and not as a master arbitrator. Third, if you require me to prove the merits of my case by clear and convincing evidence (I will not call out this master arbitrator) because you have not followed the recent Article 75 cases in the First and Second Department, you also should not be a master arbitrator. I master a lot of cases and the awards I read are absolutely horrible. Honestly, they should allow us to go directly to Court as we do on UM cases. Having to write a $325 check is the expression of putting good money after bad money.

Basic acupuncture codes proven through a coder

Healing Art Acupuncture, P.C. v Progressive Ins. Co., 2019 NY Slip Op 50574(U)(App. Term 2d Dept 2019)

(1) “At the trial, the court took judicial notice of the workers’ compensation chiropractic fee schedule and the parties stipulated that defendant’s witness was a certified medical coder. The witness testified that she had applied the workers’ compensation chiropractic fee schedule to determine payment for the services, which had been provided by a licensed acupuncturist. In the GL Acupuncture trial, the court, finding that the testimony of defendant’s witness was credible and, noting that plaintiff had failed to rebut the testimony, [*2]determined, insofar as is relevant, that defendant had properly paid the claims for services billed under CPT codes 97810 and 97811. In the case at bar, plaintiff’s attorney told the court that he agreed with defense counsel’s statement that defendant’s witness would similarly testify that she had applied the chiropractic rate to the services, which had been provided by a licensed acupuncturist. The court found, as it did in GL Acupuncture, that defendant had correctly applied the fee schedule codes. Consequently, a judgment was entered on August 4, 2016 dismissing the complaint.”

(2) “We find that defendant established that it had fully paid plaintiff for the services billed in accordance with the workers’ compensation fee schedule for acupuncture services performed by chiropractors (see Great Wall Acupuncture, P.C. v Geico Ins. Co., 26 Misc 3d 23, 24 [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2009] [“we hold, as a matter of law, that an insurer may use the workers’ compensation fee schedule for acupuncture services performed by chiropractors to determine the amount which a licensed acupuncturist is entitled to receive for such acupuncture services”]) and that plaintiff failed to rebut defendant’s showing.”

So the ministerial act of multiplying the “RVU” with the “Region IV conversion factor” was proven with a certified coder.

The new fee schedule

New fee schedule

I am just giving the highlights here.

Regulatory impacted statement

“The Superintendent therefore, deems it necessary to delay for 18 months the adoption of the medical fee schedules that the Chair has prepared and established to take effect on April 1, 2019, and so those fee schedules will take effect on October 1, 2020 for use in no-fault pursuant to Insurance Law 5108.”

” However, this amendment to Insurance Regulation 83 will exclude certain workers’ compensation ground rules from the 18-month delay, to wit: General Ground Rule 10 in the Workers’ Compensation Chiropractic Fee Schedule, General Ground Rule 13 in the Workers’ Compensation Behavioral Health Fee Schedule, and General Ground Rule 16 in the Workers’ Compensation Podiatry Fee Schedule, which prohibit providers to whom these fee schedules apply from billing under current procedural terminology (“CPT”) codes not listed in their respective fee schedules; and General Ground Rule 19 in the Workers’ Compensation Medical Fee Schedule, which prohibits any chiropractor, podiatrist or provider of behavioral health services from billing under CPT codes in the medical fee schedule. Per the Chair, these rules are not new but clarification of existing rules; therefore, the Superintendent determined it was not necessary to delay their implementation”

“the Superintendent determined an additional 20% reimbursement increase solely for general medicine specialty providers of no-fault-related health services is unwarranted, and will not be adopted for use pursuant to Insurance Law Section 5108. “

Effective April, 2019, MUA’s that chiropractors perform are not reimbursable. This is a good change for all involved in the system. All other fee changes including the de-listing of surface EMGs and all of the names of which they are known and de-listing of the computerized range of motion and every corollary of which they are known come later.

The New Jersey ASC

At its simplest, when the codes is not in the ASC, there is no compensation for it.


” In both cases, the trial court held the PIP1 medical fee schedule does not provide for payment to an ambulatory surgical center (ASC) for procedures not listed as reimbursable when performed at an ASC. We affirm. “

” We conclude that ASCs should not receive reimbursement for CPT code 63030 procedures because no reimbursement was listed in the ASC columns in the Fee Schedule, as originally proposed. This omission provides a clear indication of the Department’s intent not to reimburse ASCs for CPT code 63030 procedures. The fact that Medicare now includes the CPT code does not result in the automatic amendment of the Fee Schedule; instead, we conclude it is the Department, not Medicare, that amends the Fee Schedule. “

April 2019 (add 18 months for no-fault): a new fee schedule

The text of the amendments.

Some good things have come from the new Workers Compensation Fee Schedule Changes.

First, chiropractors cannot leave their fee schedule. Perhaps nothing was more cumbersome than seeing creative chiropractic billing.

Second, ROM/MTT/PFT are dead. I guess the computerized ROM was part of the initial comprehensive visit after all. Bad joke.

Third, Manipulation Under Anesthesia is gone. I wish this billing machine went away sooner and would be exempt from the 18 month regulator holiday.

Fourth, the pricing of EMG/NCVs are about 50% of what they are currently. More importantly, the surface EMGs and every type of name for them (CPT/neurometer/PFNCS) are gone. Good to see these billing magnets de-polarized.

Fifth, various physical medicine modality providers are getting pay raises. While this will adversely effect paid premium dollar, it makes sense if only because major medical compensates at or near $100 per diem for physical therapy. A good physical therapy facility is worth every dollar of this pay raise. What is problematic here is that no-fault does not contain any co-pays or “real” deductibles, which causes product over-utilization. This in turn causes the proliferation of “heat and stim” clinics. The deletion of the 180-day/12 session rule from proposed Ground Rule 2 will only exacerbate the over utilization of resources that are endemic in the no-fault system.

Sixth, the 8 unit rule (and associated per diem unit rules) is distinct for each provider from what I read. Assuming each unit represents 15 minutes of care, I seriously challenge someone to tell me that an EIP really received 16 units of treatment per diem. The winners here will be the providers, the lawyers representing the providers, the defense counsel who will perform the time-based treatment EUO per patient, the IME doctors who will be needed to cut off treatment earlier and the RICO firms who will use mail fraud and health care fraud as the predicate acts in support of the substantive and inchoate racketeering allegations.

Seventh, I believe there are myriad other fee-coding changes, which I have not studied nor held side-by-side to the current fee schedule.

My biggest concern here is that allowing a pay raise without resource allotment (i.e treatment guidelines) will probably cause average claim pay outs to exceed $20k assuming current treatment trends continue. The comments from WCB place this potential inferno into DFS’ lap.

The 18 month holiday regulation: “any such increases shall not be effective for no-fault until eighteen months after the effective date of the increases established by the chair.” 11 NYCRR § 68.1

Please note that 68.1(b) expired, and DFS may be working on new implementing regulations. Sta tuned.

Down-coding acceptable

Urban Well Acupuncture, P.C. v Global Liberty Ins. Co. of N.Y., 2018 NY Slip Op 51833(U)(App. Term 1st Dept. 2018)

“In opposition to defendant-insurer’s prima facie showing of entitlement to summary judgment on the grounds of lack of medical necessity and that the amounts sought exceeded the amounts permitted by the workers’ compensation fee schedule, plaintiff failed to raise a triable issue. Although defendant previously moved for summary judgment, its prior motion contained an unsworn chiropractic IME report. Thus, the court properly considered defendant’s renewed motion based upon substantively identical proof in proper form (see Cespedes v McNamee, 308 AD2d 409 [2003]).

We note that defendant, on reply below, corrected alleged coding errors in plaintiff’s bills and agreed that plaintiff was entitled to an additional $439.25.”

The last paragraph is noteworthy.  The pre-IME bills contained numerous iterations of CPT Code 97810.  The pre-IME billings were paid at either the physician or chiropractor fee schedule.  In Reply, I calculated the 97810’s, reduced them to 97811’s and conceded the chiropractor rate.  The Appellate Term agreed and the case was dismissed, less the additional sums to which Plaintiff is entitled.


The By Report paradigm

Pavlova v Allstate Ins. Co., 2018 NY Slip Op 51654(U)(App. Term 2d Dept. 2018)

“Plaintiff properly argues that where, as here, a provider does not provide such documentation with its claim form, and the insurer will not pay the claim as submitted, 11 NYCRR 65-3.5 (b) requires the insurer to, within 15 business days of its receipt of the claim form, request “any additional verification required by the insurer to establish proof of claim” (see Bronx Acupuncture Therapy, P.C. v Hereford Ins. Co., 54 Misc 3d 135[A], 2017 NY Slip Op 50101[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2017]). Thus, defendant’s denial of payment for the services billed under CPT code 20999 on the ground that plaintiff had failed to provide sufficient documentation, where defendant did not demonstrate that it had requested any such documentation, was not proper and the branch of defendant’s cross motion seeking summary judgment dismissing so much of the complaint as sought to recover for services billed under that CPT code should have been denied.”

This is an interesting case since several arbitrators have been lulled into finding that Bronx Acupuncture stands for the proposition that an insurance carrier ma not re-price a code labelled “BR” without resort to verification.  Bronx Acupuncture means what it says – you cannot deny a bill based upon the non-compliance with the by report requirements.  Should the carrier believe it has sufficient information to re-price a service, then this defense will stand despite not following the by-report protocols.  Yet, we shall still see too many arbitrators refusing to follow the law.


A 65-3.2 sighting

Village Med. Supply, Inc. v Travelers Prop. Cas. Ins. Co., 2018 NY Slip Op 51311(U)(App. Term 1sr Dept, 2018)

“Defendant-insurer established its prima facie entitlement to summary judgment dismissing the underlying first-party no-fault claims as premature, since the record conclusively establishes that plaintiff failed to respond to timely requests for verification (see St. Vincent Med. Care, P.C. v. Country Wide Ins. Co., 80 AD3d 599, 600 [2011]). No triable issue was raised by plaintiff’s claim that defendant had no “good reason” (11 NYCRR 65-3.2[c]) for its verification request for a manufacturer’s invoice documenting the cost of the supplies provided to the assignor (see New Way Med. Supply Corp. v State Farm Mut. Auto Ins. Co., 56 Misc 3d 132[A], 2017 NY Slip Op 50925[U] [App Term 2d, 11th and 13th Jud Dists 2017]; see also 12 NYCRR 442.2[a]).”

So while this was a win for the insurance carrier, 3.2(c) now serves as a basis to defeat a verification request.  My study of this area of law has shown fleeting citations of 3.2(c), but now it is clearly in vogue.

More Acupuncture fee Schedule – no new ground covered here

Jing Luo Acupuncture, P.C. v NY City Tr. Auth., 2018 NY Slip Op 51083(U)(App. Term 2d Dept. 2018)

(1) “We have held, as a matter of law, that the workers’ compensation fee schedule for acupuncture services performed by chiropractors is the appropriate fee schedule for insurers to use to determine the amount which a licensed acupuncturist is entitled to receive for acupuncture services”

(2) “As defendant argues, 11 NYCRR 65-3.8 (g) (1) (ii), effective April 1, 2013 (see 11 NYCRR 65-3.8 [g] [2]), provides that “no payment shall be due for . . . claimed medical services under any circumstances . . . for those claimed medical service fees that exceed the charges permissible pursuant to Insurance Law sections 5108 (a) and (b) and the regulations promulgated thereunder for services rendered by medical providers” (see also Oleg’s Acupuncture, P.C. v Hereford Ins. Co., 58 Misc 3d 151[A], 2018 NY Slip Op 50095[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2018]). Thus, the Civil Court incorrectly denied defendant’s cross motion on the ground that defendant was precluded from interposing its fee schedule defense.”

(3) “Defendant demonstrated that it had fully paid plaintiff in accordance with the workers’ compensation fee schedule for the services billed under CPT codes 97811, 97813 and 97814 for acupuncture services that plaintiff had rendered from August through November 2013.”

(4) “Defendant has not demonstrated, as a matter of law, its defense that the fees charged with respect to the services billed under CPT code 99262 exceeded the amounts set forth in the workers’ compensation fee schedule therefor ”

Well, once again the chiro rate prevails and some initial code that was used was not paid at the applicable chiro fee schedule or properly reduced and paid.  In addition, there is no preclusion for a fee schedule defense post April 2013.  Re-inventing the wheel.


CPM – now it is up to DFS and WCB to address the problem

Matter of Global Liberty Ins. Co. v ISurply, LLC, 2018 NY Slip Op 04961 (1st Dept. 2018)

The CPM saga came down to the  2014 letter addressing an inquiry from an insurance carrier and a 2016 letter that was responsive to an inquiry from a prominent plaintiff no-fault attorney.  The Court did not care about informal DOH opinions and WCB opinions, or the famous “FAQ” that appeared to override the 2016 letter.

Sadly, this issue has been playing out for about 6 years, mostly in arbitration.  It has had some action in the Courts, but more sporadic.  From my vantage point, the issue needed an end date.  It made no sense to have a purely legal issue bouncing back and forth in probably over 100,000 awards and court decisions.

First, for those who have questioned “what is CPM/CTU”, it is post-rehabilitative machinery that is supposed to increase healing and functionality following extremity surgery.  It is rented from about a 30-60 day period depending on the provider/supplier.  The equipment wholesales for between $6,000-$10,000.  If I am wrong, correct me – I do not have an invoice in front of me.

The rental rate that has been accepted in arbitration and court is $85-$100 per day.  The item as a 2-3 year useful life.  Again, this is what I have heard. It could be more.

therefore, assuming the equipment is used 320 days per year for 3 years, this would yield a billable value of close to $100,000 for the life of the machine.  Not bad for a $6000 investment.  And now you see the genesis of the frustration some of the pragmatists in no-fault have with what is happening here.

The Appellate Division, although couching the decision in terms of rationality held as matter of law that reimbursement shall be at the value of the rental to the general public.  Of course, nobody rents these machines on a cash basis, this there is no accurate general public fee absent “Ingenix” that exists.  And, if you want to call Ingenix a true valuation as to the cost to the general public, then you are sadly mistaken.  The Court’s holding:

“Global failed to present sufficient evidence demonstrating that the Department of Health (DOH) had determined a price for these rentals. The July 3, 2014 letter from Joanne Criscione, Senior Attorney for the Bureau of Health Insurance Programs Division of Legal Affairs for the DOH appeared to indicate that DOH had adopted “a medicaid reimbursement policy for durable medical equipment (DME) rental items that have not been assigned a Maximum Reimbursement Amount (MRA). For DME items that do not have a MRA, the rental fee is calculated at 1/6th of the equipment provider’s acquisition cost.” In her June 8, 2016 letter, however, she makes clear that her July 3, 2014 letter “was not a determination by the Department of Health area office establishing the reimbursement rate” and she “merely state[d] the Medicaid reimbursement as that policy is set forth in the Medical Provider Manual for DME.” None of Global’s other evidence establishes that DOH had adopted the “1/6th of the equipment provider’s acquisition cost” rate.

It is true that the Medicaid DME fee schedule, which listed certain codes for DMEs, some of which had a MRA and some of which did not, established that for those that did not have a MRA, the monthly rate of 1/6th of the equipment provider’s acquisition cost would apply. And it is also true that, pursuant to 12 NYCRR § 442.2(b), “the total accumulated monthly charges shall not exceed the fee amount allowed under the Medicaid fee schedule.” However, it was not irrational for the arbitrator to conclude that this 1/6th rate applied only to items which had codes listed in the Medicaid fee schedule, which the CPM and CTU at issue here did not. Therefore, as Global neither demonstrated that DOH had adopted the 1/6th rental fee guideline, or that DOH had otherwise determined a rental fee, it was not irrational for the arbitrator to conclude that the reimbursement rate would be “the monthly rental charge to the general public” (12 NYCRR 442.2(b).”

Now, it is up to DFS and WCB to finally address this issue.

One more thing.  Many of you out there are unaware of this, and I was not going to share until this opinion was published.  But, WCB has already ruled on this issue, and I suspect this is what prompted the FAQ:

In the Matter of Long Island DDSO, 2016 WL 7010143 (2016):

“As for the amount for the durable medical equipment, the valuation of durable medical equipment is not within the MTG. This is left to the Board’s Fee Schedule, which references the NYS Medicaid DME Services Fee Schedule.
The rental for the continuous passive motion machine is properly billed as E0936-RR. The Medicaid fee schedule does not contain an entry for this billing code. 12 NYCRR 442.2 (DURABLE MEDICAL GOODS FEE SCHEDULE)” provides:
(a) The maximum permissible charge for the purchase of durable medical equipment, medical/surgical supplies, and orthotic and prosthetic appliances shall be the fee payable for such equipment or supplies under the New York State Medicaid program at the time such equipment and supplies are provided, except that the fee for bone growth stimulators (HCPCS codes E0747, E0748 and E0760) shall be paid in one payment and not split. For orthopedic footwear or if the New York State Medicaid program has not established a fee payable for the specific item, then the fee payable, shall be the lesser of:
(1) the acquisition cost (i.e. the line item cost from a manufacturer or wholesaler net of any rebates, discounts or other valuable considerations, mailing, shipping, handling, insurance costs or any sales tax) to the provider plus 50%; or
(2) the usual and customary price charged to the general public.
(b) The maximum permissible monthly rental charge for such equipment, supplies and services provided on a rental basis shall not exceed the lower of the monthly rental charge to the general public or the price determined by the New York State Department of Health area office. The total accumulated monthly rental charges shall not exceed the fee amount allowed under the Medicaid fee schedule.
(c) The maximum permissible charge for the purchase of durable medical equipment, medical/surgical supplies, and orthotic and prosthetic appliances and the maximum permissible monthly rental charge for such equipment, supplies, and services provided on a rental basis as set forth in subdivisions (a) and (b) of this section are payment in full and there are no separate and/or additional payments for shipping, handling, and delivery.
As there is no fee schedule for the continuous passive motion machine, SIF is liable to reimburse the provider in accordance with “the usual and customary price charged to the general public” and that this amount “shall not exceed the lower of the monthly rental charge to the general public or the price determined by the New York State Department of Health area office.”
Therefore, upon review of the record and based upon a preponderance of the evidence, the Board Panel finds that the record supports finding the C-8.1(B) in favor of the provider, to the extent that the SIF is liable for payment for a three-week rental of the continuous passive motion machine at the usual and customary price charged to the general public. Any unpaid balance shall not be the responsibility of the claimant.

Time for action on this issue now!