New Jersey - Volume VII, Number 9 - September, 1998

PIP RULES CLAMP DOWN ON DIAGNOSTIC TESTS; ESTABLISH "CARE PATHS," "DECISION POINT REVIEW, " AND PRE-CERTIFICATION

Rules proposed by the Department of Banking and Insurance implement PIP cost-cutting provisions of the new Automobile Insurance Cost Reduction Act (Statlaw, Vol. VII, Number 6) by restricting reimbursement for diagnostic tests and establishing medical protocols called "care paths" and "decision point review" in connection with certain tests and protocols, and allowing pre-certification requirements for PIP care. Nine diagnostic tests (including surface EMGs and spinal diagnostic ultrasound) are deemed to have little or no value and will not receive PIP reimbursement. Other diagnostic tests are limited as to indication, timing, and frequency or are subject to the medical necessity standard in the proposed rules. The rules designate "care paths" as the standard course of appropriate treatment, including diagnostic tests, for identified injuries. Treatments that vary from the "care paths" will be reimbursable only when warranted by reason of medical necessity. "Care paths" for back and neck injuries are included in the proposal; more care paths for other diagnosed injuries will follow. So-called "decision point review" entails review of an injured person’s condition at certain "decision points" for determining whether further treatment or tests are needed. At these "decision points," the insurer must be notified of a decision that further treatment is needed (that decision must be supported by appropriate clinical findings), after which the insurer may require an independent medical exam. Non-compliance with the decision point plan can result in an additional copay of up to 50%. The rules also set forth standards for pre-certification of medical care for auto accident injuries. Insurers can tie special deductible/copayment programs to policies requiring pre-certification, can require that a provider utilize decision point or pre-certification review as a condition of assignment of PIP benefits, and can require that patients obtain DME directly from the insurer or its designee. Comments on the proposal are accepted to October 8, 1998. Look for the Boards of Medical Examiners, Dentistry, Physical Therapy and Chiropractic to issue their own, more detailed regulations governing diagnostic testing.

RULE PETITION URGES PROHIBITION ON CO-MANAGEMENT

The NJ Academy of Ophthalmology has asked the Medical Board to formally adopt the Board’s 1989 policy on the co-management of ophthalmic surgery patients prohibiting delegation of pre- and post-operative care by the operating ophthalmologist to an ophthalmologist with lesser training or to an optometrist. The Medical Board is considering the proposal.

HMO PROMPT CLAIMS PAYMENT RULES ADOPTED WITH FEW CHANGES

The proposed HMO prompt claims payment rules (Statlaw, Vol. VII, No. 6) have been adopted with few changes, effective October 1, 1998. Thus, any claims not settled as of that date are subject to the new rules which clarify that an HMO shall pay clean claims promptly, but no later than 60 calendar days after the date the HMO receives written or electronic notice of the claim. HMOs must, without additional demand by the provider, calculate and add 10% simple interest per annum to all overdue payments, with interest accruing as of the date the claim is overdue (the 61^st day following the date the claim was received). Payment for a contested claim, or the contested portion of a claim that is subsequently perfected is overdue if the HMO makes payment on the claim later than 90 calendar days following the HMO’s receipt of all information needed to perfect the claim.

XACT FOLLOW-UP

The replacement for Medicare Xact as the Medicare Part B carrier for New Jersey (Statlaw, Vol. VII, No. 8) will be New York’s Empire Blue. The transition is now underway with a goal of April 1, 1999 for full changeover. Anticipate delays in claims payment if there is a large turnover in claims processing staff due to Xact’s departure.