DECISION AND ORDER
Waco Ortho Rehab (Petitioner) appealed the findings and decision in of the Texas Workers’ Compensation Insurance Commission’s (Commission) Medical Review Division in MDR docket M4-02-1573-01, issued March 21, 2002. That MRD decision ordered Petitioner to refund $3,663.00 that TML Intergovernmental Risk Pool (Carrier) paid for services or treatments provided to ___(Claimant). The refund was ordered after the MRD sua sponte audited Petitioner’s bills to Carrier for during the dispute resolution process. Although the audit covered items not included in Petitioner’s request for dispute resolution, Petitioner was not notified of the scope of the audit or given an opportunity to supplement the record with information to support the audited charges. This decision finds Petitioner should not refund any of the reimbursement paid by Carrier.
I. PROCEDURAL HISTORY, NOTICE AND JURISDICTION
Petitioner billed Carrier for services billed under 45 CPT codes for dates of service from March 16 to May 25, 2001. Of these billings, Carrier denied reimbursement completely only for CPT 99070 (muscle relaxers) and CPT code 99070 (a cryopak) provided on March 16, 2001, and eight dates of service for group physical therapy billed under CPT code 97150 from April 3 to May 25, 2001. Petitioner appealed these denials to the MRD which upheld Carrier’s denial in MDR M4-02-0610-0-1 issued December 7, 2001. Petitioner then filed his Request for Amended Decision, which asked the MRD to amend the December 7, 2001, decision and find in its favor. The MRD did withdraw the decision, but instead of ruling in Petitioner’s favor, it audited all the 45 services Petitioner billed Carrier and ordered a refund of all reimbursement billed under CPT Code 97110 (individual physical therapy).
The MRD did not inform Petitioner of the audit, so Petitioner was deprived of an opportunity to submit additional documentation to support its charges. Based solely on the documentation submitted by Petitioner in its original request for dispute resolution, which involved other CPT codes, the MRD decided that Petitioner owed Carrier a refund of $3,663 for inadequately documenting charges for eight units of CPT code 97110 (individual therapy) per day on thirteen dates between March 26 and May 25, 2001. Because Carrier had not denied payment for CPT code 97110, those billings were not part of Petitioner’s original request for dispute resolution and Petitioner had not submitted specific documentation about those billings. As noted above, Petitioner appealed the decision ordering the refund.
Notice of the hearing was sent to all parties by the Chief Clerk of the Commission on April 22, 2002. The hearing in this matter was held May 20, 2002, at the Hearings Facility of the State Office of Administrative Hearings, 300 W. 15th, Austin, Texas, with Administrative Law Judge (ALJ) Ann Landeros presiding. Petitioner appeared through its attorney, Scott Hilliard. Attorney Steve Tipton represented Carrier. Staff attorney Timothy Riley represented the Commission. The record was left open until June 17, 2002, for submission of additional evidence regarding the audited items and any response to that evidence by the Respondents. After receipt of additional information, the record closed June 17, 2002.
On ___, Claimant suffered an injury to his lumbar back compensable under the Texas Workers’ Compensation Act. At the time of the compensable injury, Carrier provided Claimant’s employer with workers’ compensation coverage. Claimant was treated at Petitioner’s facility by chiropractor Dr. Craig Cernosek, who worked under the direction of Petitioner’s administrator, Dr. David Bailey, D.C.
At the hearing, Petitioner’s representative Dr. Bailey testified that Petitioner was never informed that the MRD audited all Petitioner’s billings from March 16 through May 25, 2001, until after the revised MRD decision issued. Because Petitioner did not know of the expanded scope of the MRD review, it had no opportunity to supplement the record with documentation supporting the billings.
The Commission argued that it has the right to perform an audit at any time and that its audit in this case was proper. The Commission admitted that Petitioner was not given notice of the audit prior to the issuance of the MRD decision at issue in this case. It agreed that without notice of the expanded review, Petitioner would not have had any reason to submit additional billings. However, the Commission denied that the MRD was under any obligation to inform Petitioner of the audit prior to issuing the revised findings and decision.
Carrier supported the Commission’s position and claimed it was entitled to the refund as ordered by the MRD. Carrier and the Commission argued that, because in a past TWCC contested case Dr. Bailey asserted that CPT code 97110 did not require exclusive one-on-one contact between the therapist and the patient, Petitioner had not provided the required care to justify billing that CPT code in this case.
To provide Petitioner an opportunity to respond to the audit, at the close of the hearing, the ALJ permitted it to submit additional documentation to support the billings under CPT code 97110. Petitioner submitted an affidavit from Dr. Cernosek, who had not testified at the hearing. Petitioner also submitted its therapeutic procedures chart and patient office visit reports for the disputed dates of service billed under CPT code 97110. In its Response to Provider’s Additional Evidence filed June 14, 2002, Carrier did not specifically object to the admissibility of Petitioner’s supplementary evidence, but rather, argued that the additional evidence was insufficient. The Commission’s post-hearing filing likewise did not object to the admission of any of Petitioner’s supplementary evidence. Lacking any objection, the ALJ admitted all Petitioner’s supplementary evidence into the record. However, little weight was given to Dr. Cernosek’s affidavit because the opposing parties did not have the opportunity to cross-examine him.
B. Legal Standards
Petitioner has the burden of proof in this proceeding. 28 TAC §§148.21(h) and (i). 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). Health care includes all reasonable and necessary medical services including a medical appliance or supply. TEX. LAB. CODE ANN. §401.011(19)(A). A medical benefit is a payment for health care reasonably required by the nature of the compensable injury. TEX. LAB. CODE ANN. § 401.011(31).
Spine Treatment Guideline
The Commission’s Spine Treatment Guideline (STG), 28 TAC §134.1001, effective February 2000, sets certain requirements for treatment of spinal maladies. The STG requires a documented treatment plan (including proposed methods, expected outcomes, and probable duration) and documentation substantiating any need to deviate from the STG. 28 TAC § 134.1001 (e)(3)(B)(iii). The treating doctor must demonstrate the appropriateness of all services and the
relatedness of all services to the compensable injury. 28 TAC §§ 134.1001(c)(2)(A)(ii) and (iii). Treatment must be based on the injured worker’s need and the doctor’s professional judgment. 28 TAC §134.1001(e)(1).
The STG recognizes three levels of care based on the length of treatment, type of injury, and response to treatment. The STG recognizes that some injured workers may require additional evaluations or modification of a treatment plan. 28 TAC § 134.1001(h)(1)(C). An injured worker may, depending upon clinical indicators, move between the STG’s levels of care or utilize more than one level of care simultaneously. 28 TAC §§ 134.1001(e)(2)(G) and (g)(1). In general, the most economical form of treatment is preferred. 28 TAC §134.1001(g)(5).
The STG, found at 28 TAC §134.1001(b)(1), states that it is a guideline to clarify those services that are reasonably and medically necessary for operative and nonoperative care of the spine. The STG states, however, that the guideline shall not be used as the sole reason for denial when a treatment or service is not listed in the guideline. 28 TAC § 134.1001(b)(1). For treatments other than those approved in the STG, additional documentation justifying the use of the procedure is required. 28 TAC § 134.1001(d)(3)(B)(vi).
The STG recognizes physical therapy as an appropriate treatment at both the primary (acute) level of care (generally within the first 8 weeks after the injury) and the secondary level of care. 28 TAC §§ 134.1001(g)(7)(A) and (B).
CPT Code 97110
CPT Code 97110 is the billing code for a physical medicine procedure that is provided with one-to-one contact between the therapist and the patient. Medicine Ground Rules I.A.9.b and I.C.9. A therapeutic procedure billed under CPT Code 97110 is defined as threapeutic exercises used to develop strength and endurance range of motion and flexibility. Examples include the use of graded resistance ranging from manual resistance to a variety of equipment including isokinetic, isometric, or isoinertial in one or more planes. Medicine Ground Rule I.A.11.a.
The MRD is authorized to audit medical services. 28 TAC§ 134.900. When an audit takes place, the MRD is to notify, in writing, the person or entity whose documents are to be reviewed and audited, stating when the review and audit will be performed and the commission employee to contact. 28 TAC §134.900(c).
The MRD may order the health care provider to reimburse a carrier when the carrier pays the health care provider in excess of the amount allowed by the appropriate Commission fee guideline. TEX. LAB. CODE ANN. §413.016 and 28 TAC § 134.800(g).
As a basis for ordering the refund for CPT code 97110, the MRD decision stated:
Recent review of disputes involving CPT codes 97110 by the Medical Dispute Resolution section as well as analysis from recent decisions of the State Office of Administrative Hearings indicate overall deficiencies in the adequacy of the documentation of the code both with respect to the medical necessity of one-on-one therapy and documentation reflecting that these individual services were provided as billed. Moreover, the disputes indicate confusion regarding what constitutes “one-on-one.” Therefore, consistent with the general obligation set forth in Section 413.016 of the Labor Code, the Medical Review Division has reviewed the matters in light of all the Commission requirements for proper documentation. The MRD orders a refund for the following dates of service: [table listing dates, CPT code, amount paid, amount of refund due, and rationale:]. .
Rationale: The progress notes do not identify the types of activities/therapies, or the duration of each activity/therapy; there is no direct statement as to whether the physical therapist was conducting exclusively one-on-one sessions with the claimant; and the documentation does not support the need for exclusive one-on-one treatment.
In response to the Commission’s questions, Dr. Bailey acknowledged that he previously advocated in TWCC contested cases that CPT code 97110 did not require continuous and exclusive one-on-one contact between the patient and the therapist. However, by the time the services at issue in this case were rendered, Dr. Bailey had changed Petitioner’s practice regarding individual therapy to conform with the SOAH decisions that found CPT code 97110 requires continuous one-on-one contact. Dr. Bailey further testified that he was the person who set the parameters for therapy administered at Petitioner’s facility and his instructions, as of March 2001, were that CPT code 97110 was to be used only when the therapist spent the entire 15 minute therapy session in continuous one-on-one contact with the client. He believed that CPT 97110 would not have been billed for Claimant unless it was properly administered.
The therapeutic procedures chart and the patient office visit reports submitted for Claimant established that he participated in 2 hours of individual physical therapy each day, with the type and duration of each specific activity described (e.g. “Pt. [patient] performed weights 3x10”50%. Pt. had difficulty with leg extension “10 lbs.”) While the patient office visit records were fairly repetitive except as to daily progress or pain reports, when taken with therapeutic reports’ specific information as to the type, duration, number of repetitions, the outcome, and purpose or goals, there was sufficient information to justify the billings under CPT code 97110. The records also clearly document subjective reports and objective tests of Claimant’s pain from his back injury.
Petitioner did not point to any specific evidence regarding its claim for reimbursement for the cryopack billed under CPT code 99070 provided Claimant on March 16, 2001.
There was no evidence that Petitioner did not properly provide the services billed under CPT code 97110. The MRD decision was based on an unsubstantiated presumption that Petitioner was still following Dr. Bailey’s former practice of not requiring all services billed under CPT code 97110 to one-on-one contact between the therapist and the patient. Had the MRD adhered to the Commission’s own rules and notified Petitioner in writing that the audit was being performed and had it given Petitioner an opportunity to respond to the audit, then the MRD very likely could have obtained the information needed to decide this case. Audits without notification to the parties involved at any level of the dispute resolution process violate the Commission’s explicit rules, which are intended to make the workers’ compensation system a fair one. While the Commission’s right to audit bills at any time in the dispute is recognized, performing an audit without giving notice and an opportunity to respond to the parties subverts the whole process.
Claimant suffered from back pain that interfered with his ability to return to work. When he received the individual physical therapy, Claimant was at the primary or secondary level of care under the STG, meaning the physical therapy was an appropriate medical intervention for Claimant. Petitioner’s evidence showed it had a treatment plan for Claimant that included individual physical therapy, that the therapy was provided on a one-to-one basis, that the therapy was intended to and did help cure or relieve the naturally occurring effects of Claimant’s injury. The MRD decision was based on erroneous assumptions and insufficient information. Absent notice of the scope of the audit, Petitioner had not reason to provide the additional and necessary information. Given the opportunity to submit the relevant documentation, Petitioner did so.
Petitioner met its burden to show that its billings to Carrier for services rendered to Claimant under CPT code 97110 from March 26 through May 25, 2001, were proper. Petitioner does not owe Carrier any refund for those services. Petitioner did not provide sufficient information to justify reimbursement for the cryopack provided Claimant on March 16, 2001.
III. FINDINGS OF FACT
- On ___, ___(Claimant) sustained an injury to lumbar back that was compensable under the Texas Workers’ Compensation Act (Act).
- At the time of Claimant’s compensable injury, TML Intergovernmental Risk Pool (Carrier) was the workers’ compensation insurer for Claimant’s employer.
- In March 2001, Claimant was receiving chiropractic care from Dr. Craig Cernosek, D.C., at Waco Ortho Rehab (Petitioner) for ongoing pain.
- Petitioner’s administrator, Dr. David Bailey, D.C., who set the parameters for billing under CPT code 97110, required that the therapist or doctor provide continuous, exclusive one-on-one care to the patient when providing individual physical therapy.
- On the following dates, Claimant received individual physical therapy at Petitioner’s facility: March 26, 28, 30; April 3, 4, 6; and May 4, 7, 9, 14, 18, 21, and 25, 2001.
- At the time he began the physical therapy, Claimant was about eight weeks post-injury.
- During the individual physical therapy sessions, Claimant received continuous, exclusive one-on-one care from the therapist or doctor.
- Carrier paid Petitioner’s billings under CPT code 97110 at the maximum allowable reimbursement set by the Commission’s Medical Fee Guideline for the individual therapy provided Claimant on the dates listed in Finding of Fact No. 5.
- Petitioner filed a request for medical dispute resolution with the Texas Workers’ Compensation Commission’s (Commission) Medical Review Division (MRD) after Carrier denied reimbursement for CPT codes 99070 and 97150.
- In support of its position in the medical dispute resolution proceeding, Petitioner submitted only information pertinent to its claim for reimbursement for CPT codes 99070 and 97150.
- After the MRD upheld the Carrier’s denials of reimbursement for CPT codes 99070 and 97150 in a decision issued December 7, 2001, Petitioner asked the MRD to reconsider its decision. The MRD subsequently withdrew that decision, performed an audit of all Petitioner’s billings to Carrier for Claimant during the period from March 26 through May 25, 2001, and issued another decision dated March 21, 2002, requiring Petitioner refund Carrier for services billed under CPT code 97110.
- The rationale underlying the MRD decision dated March 21, 2002, was that Petitioner’s progress notes did not identify the types of activities or therapies, or the duration of each activity or therapy; lacked a direct statement as to whether the physical therapist was conducting exclusively one-on-one sessions with the claimant; and the documentation did not support the need for exclusive one-on-one treatment.
- The MRD did not inform Petitioner of its decision to audit all the bills to Carrier.
- Because it did not know of the scope of the MRD audit, Petitioner was not able to submit information supporting its billing under CPT code 97110.
- Petitioner’s therapeutic procedures chart and patient office visit reports for Claimant documented the type of therapy given, the duration of the therapy, the number of repetitions and weights used during the therapy, the purpose or goal of each exercise, and the results of the therapy.
- Petitioner’s evidence showed it had a treatment plan for Claimant that included individual physical therapy and that the therapy was provided on a one-to-one basis.
- Claimant’s physical therapy was intended to help cure or relieve the naturally occurring effects of Claimant’s injury.
- The evidence did not establish the cryopack provided Claimant on March 16, 2001, was medically necessary.
IV. CONCLUSIONS OF LAW
- The Texas Workers’ Compensation Commission (Commission) has jurisdiction related to this matter pursuant to the Texas Workers' Compensation Act (Act), TEX. LABOR CODE ANN. § 413.031.
- 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.
- 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).
- Adequate and timely notice of the hearing was provided in accordance with TEX. GOV’T CODE ANN. §§ 2001.051 and 2001.052.
- Petitioner has the burden of proof in this proceeding. 28 TAC §§ 148.21(h) and (i).
- 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).
- Health care includes all reasonable and necessary medical services, including a medical appliance or supply. TEX. LAB. CODE ANN. §401.011(19)(A). A medical benefit is a payment for health care reasonably required by the nature of the compensable injury. TEX. LAB. CODE ANN. § 401.011(31).
- During the time period relevant to this case, physical therapy was an appropriate medical intervention for Claimant’s back injury under the Commission’s Spine Treatment Guideline, 28 TAC §§ 134.1001(g)(7)(A) and (B).
- The Commission’s Medical Review Division (MRD) is authorized to audit medical services but when an audit takes place, the MRD is to notify, in writing, the person or entity whose documents are to be reviewed and audited, stating when the review and audit will be performed and the commission employee to contact. 28 TAC §134.900(c).
- Petitioner, Waco Ortho Rehab, did not receive the required notice from MRD of the audit that resulted in the MRD decision issued March 21, 2002, in this matter.
- Carrier, TML Intergovernmental Risk Pool, is not entitled to reimbursement for the amount paid Petitioner for CPT Code 97110 because Carrier did not pay in excess of the amount allowed by the appropriate Commission fee guideline for those billings. TEX. LAB. CODE ANN. § 413.016 and 28 TAC § 134.800(g).
- Petitioner is not required to refund any amounts paid by Carrier for physical therapy services to Claimant billed under CPT code 97110.
- Petition is not entitled to reimbursement for the cryopack provided Claimant on March 16, 2001.
IT IS ORDERED that TML Intergovernmental Risk Pool is not entitled to a refund from Waco Ortho Rehab (Petitioner) for any amounts paid as reimbursement for physical therapy services to ___billed under CPT code 97110 between March 26 and May 25, 2001.
It is further ORDERED that Petitioner is not entitled to reimbursement for the cryopack provided Claimant on March 16, 2001.
Signed this ___ day of July 2002.
Administrative Law Judge
- Of the disputed issues that were part of Petitioner’s original request for dispute resolution, only the cryopack billed under CPT code 99070 remains in issue in this case. In addition to the refund, the March 21, 2001, decision ordered Carrier to reimburse Petitioner for the originally disputed services billed under CPT codes 99070 and 97150 (muscle relaxers and group therapy sessions) but denied reimbursement for the cryopack billed under CPT code 99070. Neither Petitioner nor Carrier appealed the reimbursement award, so those codes are not an issue in this case.↑
- The disputed dates of service for CPT code 97110 were: March 26, 28, 30; April 3, 4, 6; and May 4, 7, 9, 14, 18, 21, and 25, 2001.↑
- The rule at 28 TAC §134.900 states:(a) The division of medical review (the division) shall review and audit medical services, to include, but not be limited to: (1) treatments administered;(2) services provided; (3) fees charged; (4) payments made for medical treatment or services provided to injured employees; and (5) compliance with other commission rules regulating health care.
- TEX. LAB. CODE ANN. § 413.016. Payments in Violation of Medical Policies and Fee Guidelines
(b) The division may conduct a review or audit at the office of an insurance carrier, third party administrator, audit company, health care provider, or at any other appropriate location as determined by the division.
(c) The division shall notify, in writing, the person or entity whose documents are to be reviewed and audited, stating when the review and audit will be performed and the commission employee to contact.
(d) The division shall be granted access to documents and to information regarding health care treatment; fees charged; or payments made, modified, or denied. Pursuant to law, failure or refusal to comply with a division request or order for any information is an administrative violation subject to penalty as provided by the Act.
(e) The person or entity being reviewed or audited by the division shall furnish division personnel, for the duration of the review and audit, with: (1) a contact person to answer questions and respond to the needs of division staff; (2) office space; (3) access to a copy machine; and (4) access to a telephone.
(f) The commission shall charge a reasonable administrative fee, set in accordance with Administrative Procedure 5, for the review and audit conducted under this rule.
(g) The intensity of review and audit for compliance with medical policies and fee guidelines shall be increased as necessary to induce compliance by the health care provider who has established practices and patterns in medical charges or treatments inconsistent with medical policies and guidelines established by the commission.
(h) Reports of all probable violations of law and commission rules found during a review and audit shall be forwarded to the division of compliance and practices.↑
(a) The division shall order a refund of charges paid to a health care provider in excess of those allowed by the medical policies or fee guidelines. The division shall also refer the health care provider alleged to have violated this subtitle to the division of compliance and practices.
(b) If the division determines that an insurance carrier has paid medical charges that are inconsistent with the medical policies or fee guidelines adopted by the commission, the division shall refer the insurance carrier alleged to have violated this subtitle to the division of compliance and practices. If the insurance carrier reduced a charge of a health care provider that was within the guidelines, the insurance carrier shall be directed to submit the difference to the provider unless the reduction is in accordance with an agreement between the health care provider and the insurance carrier.↑