BILL ANALYSIS �
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|SENATE RULES COMMITTEE | SB 127|
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THIRD READING
Bill No: SB 127
Author: Emmerson (R)
Amended: 5/3/11
Vote: 21
SENATE LABOR & INDUSTRIAL RELATIONS COMM : 7-0, 4/27/11
AYES: Lieu, Wyland, DeSaulnier, Leno, Padilla, Runner, Yee
SENATE APPROPRIATIONS COMMITTEE : 9-0, 5/26/11
AYES: Kehoe, Walters, Alquist, Emmerson, Lieu, Pavley,
Price, Runner, Steinberg
SUBJECT : Official medical fee schedule: physician
services
SOURCE : California Orthopedic Association
DIGEST : This bill requires the Administrative Director
(AD) of the Division of Workers Compensation, in order to
keep the official medical fee schedule (OMFS) for physician
services appropriately updated, to the annually to adopt
the Current Procedural Terminology (CPT) codes,
descriptors, and modifiers published by the American
Medical Association. This bill requires new procedures
added by this update shall be coded By Report until the AD,
through public hearings, adopts and revises, the OMFS for
physician services.
ANALYSIS : Existing law:
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1.Establishes a workers' compensation system, administered
by the Administrative Director of the Division of
Workers' Compensation, to compensate an employee for
injuries sustained in the course of his/her employment.
2.Requires the administrative director, after public
hearings, to adopt and revise periodically an official
medical fee schedule that establishes reasonable maximum
fees paid for medical services, other than physician
services and other prescribed goods and services, in
accordance with specified requirements.
3.Authorizes the administrative director, after public
hearings, to adopt and revise, no less frequently than
biennially, an official medical fee schedule for
physician services, in accordance with specified
requirements.
This bill requires the AD of the Division of Workers'
Compensation, in order to keep the OMFS for physician
services appropriately updated, to the annually to adopt
the CPT codes, descriptors, and modifiers published by the
American Medical Association. This bill requires new
procedures added by this update shall be coded By Report
until the AD, through public hearings, adopts and revises,
the OMFS for physician services.
Prior Legislation
AB 2091 (Fuentes), Chapter 193, Statutes of 2009, requires
that the administrative director of the Division of
Workers' Compensation contract with an independent
consulting firm to study if there is adequate access for
injured workers of pharmacy services and prescription drugs
and, if necessary, adjust the reimbursement rates under the
Medi-Cal fee schedule.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: No
According to the Senate Appropriations Committee:
Fiscal Impact (in thousands)
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Major Provisions 2011-12 2012-13
2013-14 Fund
Annual updating of Up to
$200 Up to $50 to $100 ongoing Special*
OMFS CPT codes
Change in reimbursement
Unknown, potential increase or decrease
General/
rates for medical services over
current reimbursement rates paid
Special
by employers, including the state
* Workers' Compensation Administrative Revolving Fund
SUPPORT : (Verified 5/27/11)
California Orthopedic Association (source)
California Medical Association
California Physical Therapy Association
California Society of Industrial Medicine and Surgery
California Society of Physical Medicine and Rehabilitation
ARGUMENTS IN SUPPORT : According to the author's office:
"The last time that the CPT codes for physician
services were updated by the Division of Workers'
Compensation was in 1999. The CPT Codes, which are
annually updated and published by the American Medical
Association, describe a specific medical service and
is the nationally-accepted way for the medical
provider to clearly communicate to payors what service
was performed when they bill for a service.
"Hundreds of CPT codes have been added to the AMA CPT
Coding structure since 1999, making the existing CPT
coding system for the OMFS very outdated. This
outdated system requires providers to maintain a
separate coding system in their office to bill
Workers' Compensation services. It also causes
confusion when the provider bills a service that is
not included in the OMFS, unnecessarily increasing the
administrative costs for the payors as they manually
review and seek information from the provider as to
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the service actually performed. Having a current
coding system will decrease overhead costs for both
payors and providers and improve communication as to
the medical service performed.
"SB 127 is necessary to improve communication between
providers treating injured workers and Workers'
Compensation payors as to the medical treatment
performed and billed. This bill will also reduce
administrative costs of billing and processing a claim
for both payors and providers."
PQ:nl 5/27/11 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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