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At a Glance:
Title:
453-02-1068-m5
Date:
May 13, 2002
Status:
Retrospective Medical Necessity

453-02-1068-m5

May 13, 2002

DECISION AND ORDER

The University of Texas System (Petitioner), appealed the findings and decision of the Texas Workers’ Compensation Commission’s (Commission) Medical Review Division (MRD) in MDR Docket No. M4-01-1885-01 which ordered Petitioner to reimburse St. Luke’s Episcopal Hospital (Provider) for care billed as trauma for ___ (Claimant). The MRD decision, issued October 17, 2001, ordered Petitioner to pay an additional $ 8,033.25 to Provider for services not shown to be related to the compensable injury. This decision finds Petitioner is not liable to pay Provider any additional reimbursement.

I. JURISDICTION, NOTICE, AND PROCEDURAL HISTORY

There were no contested issues of jurisdiction, notice or venue. Therefore, those issues are addressed in the findings of fact and conclusions of law without further discussion here.

The hearing in this matter was held January 15, 2002, at the State Office of Administrative Hearings, 1700 N. Congress, Suite 1100, Austin, Texas, with Administrative Law Judge (ALJ) Suzanne Marshall presiding. After receipt of evidence and argument, the record was left open for receipt of written briefs. After receipt of the briefs, the record closed March 21, 2002. Petitioner was represented by Assistant Attorney General Jason Itkin. No one appeared on behalf of Provider. The Commission did not participate in the hearing but did submit a post-hearing brief in support of the MRD decision. Kim Teich, claims supervisor for the University of Texas System, provided testimony on behalf of Petitioner.

II. DISCUSSION

A. Background Facts

On____, Claimant fell and broke his leg while at work at M.D. Anderson Hospital, an injury compensable under the Texas Workers’ Compensation Act (Act). At the time of Claimant’s compensable injury, Petitioner provided workers’ compensation insurance to Claimant’s employer.

Claimant was seen at the M.D. Anderson emergency room immediately after his fall. Because his orthopedic surgeon practiced at Provider, Claimant obtained a transfer to Provider for for orthopedic care. At Provider, Dr. Michael Huo, M.D., admitted Claimant with a diagnosis of left supracondylar femur fracture with “other associated diagnoses” of status post left total hip replacement, gastric reflux disease, obesity, and history of cholecystectomy and carpal tunnel release. (Exh. 1, p. 19). On May 29, 2000, Claimant underwent an open reduction and internal fixation of the left supracondylar femur fracture. He was discharged from Provider on June 2, 2000. (Exh. 1, p. 21.) The discharge summary noted: “General: The patient is alert and oriented. There were no other associated injuries. . . Hospital Course: . . .The patient’s postoperative course was without any complications. He received routine prophylaxis using antibiotics and anticoagulation. His laboratory data parameters remained stable from preoperative levels.” (Exh. 1, pp. 21-22).

B. Parties’ Positions

Claimant’s injury was given principal diagnosis code 821.23, a trauma code, while at Provider. Provider billed Petitioner for all services rendered Claimant while he was an inpatient[1]. For reasons not apparent in the medical records, Claimant received medications and tests unrelated to the compensable injury. For instance, he was tested for both HIV and hepatitis and given a chest x-ray. Provider claimed that under the Commission’s rule at 28 Tex. Admin. Code§134.401(C)(5),[2] a principal diagnosis with a trauma code required Petitioner pay for all goods and services provided Claimant during his hospital stay. Petitioner argued that reimbursement was limited to those goods and services related to the compensable injury, the leg fracture.

In its brief, the Commission argued that proof of medical necessity is not an issue in this case because the Commission rule sets reimbursement for trauma code diagnoses at the fair and reasonable rate. Because a showing of medical necessity was not necessary, the Commission further argued that all goods and services provided under the trauma code were reimbursable regardless of whether the expenditure related to the compensable injury. The Commission’s position seemed to be that the Commission rule setting reimbursement at the fair and reasonable rate trumps the Act’s requirement that medical care is limited to the goods and services necessary to treat the compensable injury.

C. Analysis

The Act clearly limits compensation to the injury sustained in the course of employment or the effects naturally resulting from that injury. Pursuant to the Act, an employee who has sustained a compensable injury is entitled to all health care reasonably required by the nature of the injury as and when needed. Under the Act, an “injury” means damage or harm to the physical structure of the body and a disease or infection naturally resulting from the damage or harm, including an occupation disease. Tex. Lab. Code Ann. § 401.011(26). “ Compensable injury” means an injury that arises out of and in the course and scope of employment for which compensation is payable under this subtitle. Tex. Lab. Code Ann. § 401.011(10).

The employee is specifically entitled to health care that cures or relieves the effects naturally resulting from the compensable injury, promotes recovery, or enhances the ability of the employee to return to or retain employment. Tex. Lab. Code Ann. § 408.021(a). Health care includes all reasonable and necessary medical services, including a medical appliance or supply. Tex. Lab. Code Ann.§401.011(19)(A). Medical benefit means payment for health care reasonably required by the nature of a compensable injury and intended to cure or relieve the effects naturally resulting from the compensable injury, including reasonable expenses incurred by the employee for necessary treatment to cure and relieve the employee from the effects of an occupational disease before and after the employee knew or should have known the nature of the disability and its relationship to the employment. Tex. Lab. Code Ann. § 401.011(31)(A).

The Commission’s interpretation of 28 TAC § 134.401(c)(5) directly contradicts several of its other rules which address treating unrelated or intercurrent illnesses. In those rules, the Commission recognized its statutory mandate to limit care to the compensable injury. The rules state the provider must inform the injured worker that treatment that appears to be unrelated to the compensable injury (e.g. treatment of parts of the body other than the part originally injured or of a preexisting medical condition) may not be covered by the insurance carrier. See, 28 TAC 134.1003(e)(4); 28 TAC § 134.1001(h)(1)(b). Nothing in these rules ties liability for reimbursement to use of a trauma code.

Agencies lack inherent authority and may only exercise those powers that are specifically granted to them by statute. Sexton v. Mount Olivet Cemetary Assoc., 720 S.W.2d 129, 137 (Tex. App.- Austin 1986, writ ref’d n.r.e). The Texas Legislature specifically charged the Commission with enacting guidelines for payment of medical benefits that both ensure the quality of medical care and achieve effective medical cost control. Tex. Lab. Code Ann. § 413.011(b). The Act’s mandate cannot be changed by a Commission rule. A rule that allows compensation for treatment unrelated to the compensable injury exceeds the Commission’s authority because it is not in harmony with the general objectives of the Act. See International Ins. Agency v. Railroad Comm’n, 893 S.W.2d 204, 207 (Tex. App. - Austin 1995, writ den). Effective medical cost control cannot be achieved by requiring carriers to pay for treatment of maladies unrelated to the compensable injury.[3] Interpreting the rule at 28 TAC §134.401(c)(5) to require payment for any treatment rendered during a hospital stay under a trauma code, whether or not related to the compensable injury, is a gross distortion of the Act’s purpose. The rule must be read so that it is harmony with the Commission’s mandate and legislative intent as expressed in the statute. To be in harmony with the Act’s purpose, the reimbursement allowed in 28 TAC § 134.401(c)(5) must be limited to services provided under a trauma code for treatment of a compensable injury.

Petitioner’s interpretation of 28 TAC § 134.401(c)(5) as requiring payment, not for all treatment rendered under a trauma code, but only for treatment related to the compensable injury, is the most sensible interpretation. As Petitioner pointed out, the rule requires “reimbursement for the entire admission shall be at a fair and reasonable rate” not that “reimbursement for all services be at a fair and reasonable rate.” In this case, Claimant was admitted to Provider’s facility for treatment of a compensable leg fracture. Petitioner reimbursed treatment of the leg fracture. That is all the treatment shown by this record to be related to the compensable injury. As Provider did not appeal the MRD’s finding that the reimbursement paid was at a fair and reasonable rate, that issue is not in dispute in this case.

Petitioner is not liable to pay Petitioner reimbursement for any goods or services provided Claimant unrelated to the compensable injury, the leg fracture.

III. FINDINGS OF FACT

  1. On _______Claimant fell and broke his leg while at work at M.D. Anderson Hospital, an injury compensable under the Texas Workers’ Compensation Act (Act).
  2. At the time of Claimant’s compensable injury, the University of Texas System (Petitioner), as a self-insured entity, provided workers’ compensation insurance to Claimant’s employer.
  3. Claimant was admitted to St. Luke’s Episcopal Hospital (Provider) with a principal diagnostic code of 821.23, a trauma code.
  4. While at Provider, Claimant received goods and services unrelated to the treatment of his compensable injury, the broken leg.
  5. Provider billed Petitioner for all goods and services provided to Claimant during his hospitalization from May 28 to June 2, 2000.
  6. Petitioner declined to reimburse Provider for goods and services provided Claimant that were unrelated to his compensable injury, including chest x-rays, HIV testing, and hepatitis testing.
  7. Petitioner reimbursed Provider at a fair and reasonable rate for the goods and services provided Claimant to treat his broken leg.

IV. CONCLUSIONS OF LAW

  1. The Texas Workers’ Compensation Commission (Commission) has jurisdiction related to this matter pursuant to the Texas Workers' Compensation Act (Act), Tex. Lab. Code Ann. § 413.031.
  2. The State Office of Administrative Hearings has jurisdiction over matters related to the hearing in this proceeding, including the authority to issue a decision and order, pursuant to § 413.031(d) of the Act and Tex. Gov’t Code Ann. ch. 2003.
  3. The hearing was conducted pursuant to the Administrative Procedure Act, Tex. Gov’t Code Ann. ch. 2001 and the Commission’s rules, 28 Tex. Admin. Code (TAC) §133.305(g).
  4. Adequate and timely notice of the hearing was provided in accordance withTex. Gov’t Code Ann. §§ 2001.051 and 2001.052.
  5. Petitioner has the burden of proof in this proceeding. 28 TAC §§ 148.21(h) and (i).
  6. Pursuant to the Act, an employee who has sustained a compensable injury is entitled to all health care reasonably required by the nature of the injury as and when needed. The employee is specifically entitled to health care that cures or relieves the effects naturally resulting from the compensable injury, promotes recovery, or enhances the ability of the employee to return to or retain employment. Tex. Lab. Code Ann. § 408.021(a).
  7. Health care includes all reasonable and necessary medical services, including a medical appliance or supply. Tex. Lab. Code Ann. §401.011(19)(A). Medical benefit means payment for health care reasonably required by the nature of a compensable injury and intended to cure or relieve the effects naturally resulting from the compensable injury, including reasonable expenses incurred by the employee for necessary treatment to cure and relieve the employee from the effects of an occupational disease before and after the employee knew or should have known the nature of the disability and its relationship to the employment. Tex. Lab. CodeAnn§ 401.011(31)(A).
  8. The Commission’s rule at 28 TAC §134.401(c)(5) requires payment not for all treatment rendered under a trauma code, but only for treatment related to the compensable injury.
  9. Petitioner was liable to reimburse Provider only for those services reasonably required by the nature of the compensable injury, which was a broken leg.
  10. Petitioner is not liable to pay additional reimbursement to Provider for treatment provided to Claimant unrelated to the compensable injury.

ORDER

IT IS ORDERED that University of Texas System is not liable to reimburse St. Luke’s Hospital for the goods and services provided Claimant J.G. from May 28 to June 2, 2000, which were unrelated to his compensable injury, a leg fracture.

Signed this 13th day of May, 2002.

SUZANNE FORMBY MARSHALL
Administrative Law Judge

  1. Provider also billed Petitioner for implantables. Petitioner requested copies of the invoices for the implantables’ cost. These have not been provided to Petitioner. The issue of the proper amount of reimbursement for implantables is not decided here.
  2. 28 TAC § 134.401(c)(5). Reimbursement for Certain ICD-9 Codes. When the following ICD-9 diagnosis codes are listed as the primary diagnosis, reimbursement for the entire admission shall be at a fair and reasonable rate:
  3. (A) Trauma (ICD-9 codes 800.0-959.50); (B) Burns (ICD-9 codes 940-949.9); and (C) Human Immunodeficiency Virus (HIV) (ICD-9 codes 042-044.9).

  4. This decision does not address the issue of payment for services related to preexisting conditions aggravated by a compensable injury. There was no evidence in this case that any of the disputed services in this case fell into that category.
End of Document
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