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Regulators dodged a bullet, but another one’s in the chamber

The Medicare vote to rescind the 10% cut in physician reimbursement likely kept many docs in the business of providing medical care to workers comp patients.
But that ‘stay of execution’ ends Jan 1 2010 when a 21% cut is scheduled to go into effect.
As Bob Laszewski has been noting, the current incredibly stupid way we are addressing Medicare physician compensation is resolving nothing, while ensuring we’re right back on the edge in eighteen months.
Long-time readers are undoubtedly tired of me reciting the myriad reasons it is dumb to base WC reimbursement on Medicare. But here’s yet another example – WC is a state-based system where reimbursement is controlled by a political process completely unconcerned about its implications for comp insurers, employers, physicians, or injured workers.
A study completed in 2007 illustrated the problem – low reimbursement rates mean few physicians are willing to treat comp claimants. Among the five states that based their fee schedule on low percentages of Medicare (109% to 125% of Medicare), the percentage of neurologists and orthopaedists that participated in workers’ compensation tended to be a fraction of the available population (9% to 27% for neurologists, 23% to 46% for orthopaedists).
Among the states using Medicare’s RBRVS as the basis for physician reimbursement are Florida, Pennsylvania, West Virginia, Hawaii, Maryland, California, Michigan, Ohio, Tennessee, Minnesota, Oregon and Texas.
Yes, most pay above the Medicare rate, and many have built-in inflation adjustments. But physician compensation is still primarily controlled by the politics of Washington.

Joe Paduda is the principal of Health Strategy Associates



A national consulting firm specializing in managed care for workers’ compensation, group health and auto, and health care cost containment. We serve insurers, employers and health care providers.



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