Substance Over Form? A Guide to the New York State Workers' Compensation Board's CMS-1500 Initiative

Substance Over Form?

A Guide to the New York State Workers’ Compensation Board’s CMS-1500 Initiative and C-4 Auth Denials

Debra L. Doby | Mark A. Hauck JULY 30, 2018

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Substance Over Form? A Guide to the New York State Workers’ Compensation Board’s CMS-1500 Initiative and C-4 Auth Denials The New York State Workers’ Compensation Board recently introduced two significant changes to medical filings: the elimination of the C-8.1A filing requirement and the adoption of the CMS-1500 , both of which aim to reduce the burden of paperwork filing.

C-4AUTH DENIALS AND C-8.1A The first significant change is the elimination of the requirement to file a C-8.1A when completing a C-4AUTH denial. This was a burdensome requirement that appeared redundant and frequently resulted in the approval of authorization requests that should have been denied. The C-8.1A only served to reiterate the objection already included on the C-4AUTH denial.

Per board subject number 046-1085 issued on July 25, 2018, effective immediately, there is no longer a requirement to complete a C-8.1A when denying a request for authorization. This is based on the finding in a recent board panel decision that “the filing of a C-8.1A form, which mirrors the C4-AUTH, is redundant and unnecessary.” This relieves a significant filing burden of a redundant form and removes another pitfall in claims administration. It would appear, based on the board panel decision, that this would apply to currently pending C-4AUTH denials and appeals on that issue as well. Attorneys should cite both the subject number and Matter of J&A Concrete Corporation, 2017 NY Wrk Comp G1078502 (09/05/2017) when this issue arises.

CMS-1500 INITIATIVE In April, the board announced its goal to implement measures to improve access to health care by increasing provider participation in the system. The board will attempt to increase participation with increased fees, simplified forms, and “other enhancements” including providing a medical portal and expanding patient access to different types of medical providers.

As part this plan, the board has chosen to adopt the ubiquitous CMS-1500 (previously the HCFA-1500) in order to reduce the burden of paperwork on providers. Medicare uses this form for medical billing and the majority medical providers have adopted it.

The board’s version varies slightly by including a section for information regarding workers’ compensation carriers.

What is the CMS-1500?

The CMS-1500 is a medical billing form that includes all of the information needed to process a medical bill (aside from narratives and attachments as described below).1 Biographical data on the patient, information on the insured (the employer in the case of WC), claims data (like case numbers etc.), an indication of whether the condition is due to an accident or injury, provider information, diagnosis codes (ICD-10), and CPT billing codes are included, among other information.

What is the CMS-1500 replacing?

The CMS-1500 is replacing all initial and subsequent treatment forms. These are the C-4, C-4.2, C-4NARR, C-4AMR, and the equivalent forms for psychological treatment, physical therapy, and occupational therapy, as well as the electronic (EC) versions of these forms. It is not clear if the board is also eliminating the C-5 (Attending Ophthalmologist’s Report).2

When does all of this go into effect?

The program will go into effect in three phases.3 In Phase 1, starting on January 1, 2019, providers can participate voluntarily to bill with CMS-1500 through an approved “XML Submission Partner”4 (XSP). Insurers or payers will need to be prepared to accept these forms through “clearinghouses” (this term is used interchangeably with XSP) and respond to the bills electronically with a return acknowledgement of receipt. The board will receive the form and any attachments, which will be combined and filed electronically.

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See Fig. 1

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There is mention of a required attachment for optometrists. “CMS-1500 Initiative: CMS-1500 Requirements.”; http://www.wcb.ny.gov/CMS-1500/requirements.jsp

3

For a longer discussion see “Proposed Timeline”; http://www.wcb.ny.gov/CMS-1500/timeline.jsp

4

A vendor approved by the board to handle forwarding and filing of these forms.

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Goldberg Segalla | Substance Over Form? A Guide to the New York State Workers’ Compensation Board’s CMS-1500 Initiative and C-4 Auth Denials

In Phase 2, starting July 1, 2019, payers will start to respond to bills with explanations of benefits (EOB) electronically to their XSP. The data from the EOB will then be transmitted to the provider and the board. The board indicates that they will allow submission of an EOB in this way in lieu of a C-8.1b or C-8.4. The provider would then have to reply with an HP-1 to seek review of the reduction or denial of payment.

Finally, Phase 3 will see full implementation on January 1, 2020. The use of CMS-1500 and electronic submission will then be required from all providers (without a demonstration of hardship). The forms to be replaced, as noted above, will no longer be accepted.

Providers will need to register with the board in order to participate.

What changes for providers?

In addition to the new form and registering with the board, there are some additional steps for providers. Most notably, for the purposes of payers, the provider must include a detailed narrative. The board’s Frequently Asked Questions for this process indicate that XSPs will be told to reject any CMS-1500 that does not include the required detailed narrative.

The board specifically states what the detailed narrative must contain. There are separate requirements for initial medical narratives, subsequent medical narratives, psychology narratives, and physical therapy and occupational therapy narratives.5 For example, an initial narrative must include [history of the injury and illness, objective findings/clinical evaluation, diagnosis(es)/assessment, doctor’s opinion (based on this examination), causation, plan of care, work status, and temporary impairment (presumably only if applicable)]. Further, each of these categories have sub-requirements. The history portion has to include where and how the injury occurred, details regarding the nature of the injury, employment status6, function, previous treatment, relevant medical history, and medications. Some of these sub-requirements have requirements of their own.

The board is very clear that a bill is not valid unless it includes the detailed narrative.

As noted above, if a bill is rejected electronically with an EOB then the provider will have to request review with an HP-1. This appears to indicate that the Board will no longer automatically make administrative decisions or schedule hearings for bills rejected through an EOB that would previously been objected to with a C-8.1b.

What is the role of the insurer/payer?

The insurer will still need to receive and “adjudicate” the bill. This means examining the bill and either paying it or issuing an EOB or similar rejection. All filings including EOBs and acknowledgements will need to be electronic through the XSP. The burden here is potentially reduced as there is no board form for EOBs as of yet, and presumably you can continue to utilize the previous system for EOBs. It is possible the board may implement its own form.

The payer’s acknowledgement needs to include the unique CMS-1500 document number, unique narrative document number, acknowledgement date, payer’s “W” number, XML partner name or ID number, and WCB case number (if assembled).

What medical forms are not going away?

The following medical forms will persist:

• c-4.3 “Doctor’s Report of MMI/Permanent Impairment” • C-4Auth “Attending Doctor’s Request for Authorization and Carrier’s Response” • MG-1 “Attending Doctor’s Request for Optional Prior Approval and Carrier’s/Employer’s Response” • MG-2 “Attending Doctor’s Request for Approval of Variance and Carrier’s Response” The various IME forms will remain in use, likely along with some of the more obscure medical forms like the MD-1.

“CMS-1500 Initiative: Medical Narrative Requirements, Initial Narrative Report”; http://www.wcb.ny.gov/CMS-1500/initial-report.jsp: “CMS-1500 Initiative: Medical Narrative Requirements, Subsequent Narrative Report”; http://www.wcb.ny.gov/CMS-1500/subsequent-report.jsp: “CMS-1500 Initiative: Medical Narrative Requirements, Psychology Narrative Report”; http://www.wcb.ny.gov/CMS-1500/psychology-narrative.jsp: “CMS-1500 Initiative: Medical Narrative Requirements, PT/ OT Narrative Report”; http://www.wcb.ny.gov/CMS-1500/PT-OT-narrative.jsp.

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6 This is a statement of current work status, i.e. is the claimant working, as opposed to the separate “work status” section which includes descriptions of whether the claimant can return to work, work limitations, and discussions regarding return to work.

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Goldberg Segalla | Substance Over Form? A Guide to the New York State Workers’ Compensation Board’s CMS-1500 Initiative and C-4 Auth Denials

CONCLUSION When the program begins, you should be ensuring that the provider completing the form has completed the CMS-1500 and its appropriate narrative completely. The board indicates that incomplete forms and forms with incomplete narratives will be rejected. Although it is less clear whether the submission of incomplete forms will constitute grounds for non-payment, we recommend objecting to any incomplete bills.

Hopefully, with the specific requirements for narratives, we should start seeing much more detailed and useful information in medical reports. While this will initially be frustrating for treating providers and probably for their patients as well, the additional information should improve claims administration and reduce confusion for all parties involved.

Overall, we do expect the usual confusion and reluctance to adopt the new system. But, once wholly adopted, we hope this new medical billing process will result in a reduced burden on all parties.

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Goldberg Segalla | Substance Over Form? A Guide to the New York State Workers’ Compensation Board’s CMS-1500 Initiative and C-4 Auth Denials

Figure 1

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Goldberg Segalla | Substance Over Form? A Guide to the New York State Workers’ Compensation Board’s CMS-1500 Initiative and C-4 Auth Denials

Meet the Authors DEBRA L. DOBY 914.798.5421 ddoby@goldbergsegalla.com

Debra Doby concentrates her practice on workers’ compensation litigation, maritime law, and intellectual property. A partner and experienced litigator, she is also architect of Goldberg Segalla’s Opioid Impact Program, an innovative and comprehensive approach to helping claims professionals reduce claimants’ use of prescription medications. On top of her service litigating and advising her clients, Debra has written and presented on subjects including opioid addiction and overprescription, obesity, and the clash of whalers and protestors in the Southern Ocean — and well beyond their merely legal applications. Debra also organizes the firm’s workers’ compensation webinar series and serves as co-editor of the Workers’ Compensation Defense Blog.

MARK A. HAUCK 585.295.8323 mhauck@goldbergsegalla.com

Mark Hauck, an associate, is a seasoned workers’ compensation litigator whose practice focuses on defending complex workers’ compensation claims before the New York State Workers’ Compensation Board. With a background that includes representing claimants in workers’ compensation proceedings and acting as a hearing attorney with New York State’s Special Funds Conservation Committee, Mark offers clients in-depth knowledge of the claims process and extensive experience taking testimony and depositions, negotiating and facilitating settlements, and writing and filing appeals.

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