Texas Court Upholds New Workers’ Comp Medical Fee Schedule

A late April Texas trial court ruling released last week will reportedly help control workers’ compensation medical costs by setting reasonable medical fees within the state’s workers compensation system, according to the Alliance of American Insurers (AAI).

The ruling, by Travis County Judge John Dietz, upheld a revised medical fee guideline promulgated by the Texas Workers Compensation Commission (TWCC) last year.

“The ruling will reduce medical claims costs by about 6 percent by reducing highly-overpaid surgical services and increasing fees for underpaid General Practitioners,” Joe Woods, assistant vice president of the Alliance’s Southwest Region, commented.

Last year, TWCC adopted a new medical fee guideline based on legislation of the 2001 Legislative Session. The guidelines adopted Medicare billing, coding and payment policies and set the reimbursement rate for physician services at 125 percent of Medicare.

The Texas AFL-CIO and the Texas Medical Association (TMA) had filed suit challenging the legality of the rule creating the new medical fee guidelines.

On April 21, 2003, the court issued an advisory letter indicating that it ruled in favor of TWCC on all issues.

According to the letter, the medical fee guidelines rule:
·was not arbitrary and in violation of the statute under while the rule was promulgated;
·does not violate Texas law concerning reimbursement guidelines;
·does not unlawfully sub-delegate the power to set fees; and
·is valid and reflects TWCC’s judgment as to a fair and reasonable fee.

The court stated that this disposes of all claims in the case and directed the attorney general to draft an order for the court’s signature.

“This is a real win for the employer community of Texas,” David Anderson, vice president and assistant director of workers compensation and health for the Alliance, remarked. “The ruling validates a medical fee schedule that will significantly reduce the high medical costs in the Texas system. Finally, some of the hope and promise of the 2001 reform legislation enacted by HB 2600 will be realized. This is a major step in the right direction for Texas, and we intend to be on guard to protect it in the legislature, if necessary.”