BILL ANALYSIS                                                                                                                                                                                                    �



                                                                  SB 127
                                                                  Page  1

          Date of Hearing:   August 17, 2011

                        ASSEMBLY COMMITTEE ON APPROPRIATIONS
                                Felipe Fuentes, Chair

                    SB 127 (Emmerson) - As Amended:  May 3, 2011 

          Policy Committee:                              InsuranceVote:11 
          - 0 

          Urgency:     No                   State Mandated Local Program: 
          No     Reimbursable:              

           SUMMARY  

          This bill requires the Administrative Director of the Division 
          of Workers' Compensation to adopt annually the Current 
          Procedural Terminology (CPT) codes, descriptors, and modifiers 
          published by the American Medical Association in order to keep 
          the fee schedule for physicians' services updated. 

           FISCAL EFFECT  

          Costs associated with this legislation would be minor and 
          absorbable within existing resources.

           COMMENTS  

           1)Rationale  . The purpose of this bill is to obtain cost savings 
            in the workers compensation system for both medical providers 
            and payors by updating a key element of the billing system on 
            a regular basis.

            According to the author, hundreds of CPT codes have been added 
            since the last time the Official Medical Fee Schedule (OMFS) 
            has been updated.  This results in providers maintaining a 
            separate workers' compensation billing system, or, if the 
            provider bills using newer CPT codes the OMFS does not 
            recognize, confusion between the provider and payor over what 
            services were provided and how they should be compensated.  
            The author believes an updated system will save costs for both 
            providers and payors.

           2)Related Legislation  . SB 923 (De Leon) requires the 
            Administrative Director of the Division of Workers' 








                                                                  SB 127
                                                                  Page  2

            Compensation to adopt a resource-based relative value scale 
            (RBRVS) for physician services.  That bill is currently 
            pending in this committee. 

           Analysis Prepared by  :    Julie Salley-Gray / APPR. / (916) 
          319-2081