DECISION AND ORDER

American Home Assurance Company (Carrier) appealed the decision and order of the Texas Workers’ Compensation Commission’s (Commission) Medical Review Division (MRD) in MDR Docket No. M5-02-1359-01, which granted reimbursement of $475 to First Rio Valley Medical, P.A., (Provider) billed for a group patient education session to a workers’ compensation claimant (Claimant). Carrier had denied reimbursement to Provider claiming the session was not medically necessary healthcare. This decision finds Carrier is not liable to reimburse Provider for the course which was not medically necessary, was not billed at a fair and reasonable rate, and which was billed under the wrong CPT code.

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 convened and the record closed on October 15, 2002, at the State Office of Administrative Hearings, 300 W. 15^th Street, Austin, Texas, with Administrative Law Judge (ALJ) Ann Landeros presiding. Provider was represented by its attorney, William Maxwell. Respondent was represented by its attorney, Steven Tipton. The Commission did not participate in the hearing.

II. DISCUSSION

A. Background Facts

In_________, Claimant injured her knee, an injury compensable under the Texas Workers’ Compensation Act (Act). At the time of the compensable injury, Carrier was the workers’ compensation insurer for Claimant’s employer.

In August 2001, Dr. Robert Howell, D.C., prescribed an E-Ice machine to Claimant to provide cold therapy to her knee. Dr. Howell billed Carrier $475 under CPT code 99078^[1] for, as he described it, a “lengthy educational class” to educate Claimant on how to use the machine. (Exh. 1, p. 43). Carrier denied reimbursement alleging lack of medical necessity. The MRD decision found that the patient education course was medically necessary, relying on Dr. Howell’s explanation that the course was needed to instruct Claimant on proper use of the machine. The MRD decision summarized that explanation as inform regarding the: “Purpose & when to use, how to use, how to adjust water circulation cycle, frequency of use, lifting technique, precautions explained, contraindications, special considerations, adverse effects and localized reaction to cold. Without this risk the claimant could be at risk for reinjury.” (Exh. 1, p. 3).

The MRD decision also contained the following explanation:

The Carrier did not deny the charges as fair and reasonable. The medical documentation indicates that the services were rendered, and medically necessary in the training of the claimant in the use of the E-Ice machine in it’s [sic] use and to prevent and [sic] skin or tissue breakdown. Therefore, reimbursement is recommended in the amount of $475.00.

As written, the MRD decision implies that Carrier’s failure to challenge reimbursement as fair and reasonable somehow precluded a sua sponte analysis of that issue by the MRD. Carrier timely appealed the MRD decision.

B. Evidence

Provider submitted Dr. Howell’s “Medical Necessity and Explanation Letter for an Educational Class on the EBIce Machine” to the MRD to explain why Claimant needed, and was provided, an educational course on operation of the machine. The letter further explained the instructions given Claimant during that session. This letter was the only evidence in the record supporting the medical necessity of the educational course. In the letter, Dr. Howell stated that he personally gave Claimant the course, writing:

I demonstrated to [Claimant] how to start the E-Ice system cold therapy treatment. After I showed her, she positioned the knob at the center of the dial (12 o’clock position). . . .I also demonstrated that bending the knees was crucial to this process. I also told and demonstrated her [sic] how to lift with both shoulders so that the weight could be distributed between the two shoulders and not just one. . . (Exh. 1, pp. 43-45)(Emphasis added.)

Admitted into evidence as Exhibit 3 were Carrier’s interrogatories to Provider along with the answers given by Dr. Howell. The interrogatories and answers were as follows:

Interrogatory No. 1: What was the start time and end time of the period Dr. Howell personally spent with [Claimant] on August 30, 2001 instructing her on the E-Ice machine?”

Response to Interrogatory No.1: Dr. Sam Allen personally spent time with [Claimant], not Dr. Howell. Dr. Allen did so under the instruction of Dr. Howell.

Interrogatory No. 2: What was the total number of patients instructed on August 30, 2001 by Dr. Howell regarding the E-Ice machine?

Response to Interrogatory No. 2: None.

Interrogatory No. 3: What was the start time and end time of the period Dr. Howell personally spent with all patients other than [Claimant] on August 30, 2001 instructing them on the E-Ice machine?

Response to Interrogatory No. 3: Dr. Allen spent 30 minutes with [Claimant] on 8-27-2001 for the exam and he spent another 30 minutes explaining how to use the machine.

Carrier provided reports from two utilization review doctors, both of whom stated the course was not medically necessary. (Exh. 2, pp.4,10).

Provider argued that the MRD had properly limited its review to the issue raised in the denial of benefits, whether the course was medically necessary. Provider relied on Dr. Howell’s letter to establish medical necessity for the course. Finally, Provider challenged the qualifications of Carrier’s two utilization review experts and argued those opinions should be excluded as unreliable.

C. Legal Standards

Carrier has the burden of proof in this proceeding. 28 TAC §§ 148.21(h) and (i); 1 TAC § 155.41. 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).

The treating doctor is the doctor who is primarily responsible for coordinating the employee’s health care for an injury, and has the specific responsibility for maintaining the efficient utilization of healthcare. 28 TAC § 133.3.

The MRD shall review and audit medical services, including treatments administered, services provided, and fees charged. 28 TAC § 134.900.^[2] 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^[3] and 28 TAC § 134.800(g).

CPT code 99078 is for “physician educational services rendered to patients in a group setting (e.g., prenatal, obesity, or diabetic instructions),” which are billed DOP (documentation of procedure – that is, based on the documented information supporting the charge). Medicine Ground Rules, Commission’s 1996 Medical Fee Guideline (repealed effective January 1, 2002).

C. Analysis

There was no credible evidence in the record to establish that course was medically necessary. Dr. Howell discredited his own statement by contradicting himself about who actually spoke to Claimant. The course was billed under the incorrect CPT code because it was not given to a group. Further, the supporting documentation did not show that reimbursement of $475 was fair and reasonable, an issue the MRD not only could have, but should have, addressed, whether or not it was raised by the Carrier, pursuant to the Commission’s rule at 28 TAC § 134.900.

The only evidence supporting the medical necessity of the patient education course was Dr. Howell’s letter, in which he stated he personally instructed Claimant on the use of the E-Ice machine. The MRD cited these specific statements to justify its decision finding the course was medically necessary. In fact, those statements were either completely false or, at best, unreliable, based on Dr. Howell’s responses to Carrier’s interrogatories. In his responses, Dr. Howell contradicted his letter and stated it was Dr. Allen who gave Claimant the instructions. In light of that contradiction, Dr. Howell’s letter cannot be relied upon to support the MRD’s decision.^[4]

The only evidence that Dr. Allen had any contact with Claimant is in Dr. Howell’s interrogatory responses. The record lacks any information about what Dr. Allen may have done with regard to instructing Claimant. Even were Dr. Howell’s letter given credence, it cannot be assumed that Dr. Allen gave Claimant the same information Dr. Howell described in his letter. Because Dr. Howell discredited himself by admitting he did not give Claimant the information he claimed in his letter, there is no evidence to support the medical necessity of the course.

Provider billed using an incorrect CPT code. CPT code 99078 is for group patient education. Both Dr. Howell’s letter and his response to interrogatories established that Claimant did not participate in a group education course.

The MRD had an affirmative duty to review whether the charge was billed at a fair and reasonable rate. In the past, the MRD exercised its right to conduct audits of medical claims sua sponte. See, SOAH docket 453-02-2706.M4 (ALJ Landeros, July 2002). Why it hesitated to do so in this instance is unclear. It obviously had qualms about the charge since it made a point to justify its inaction based on Carrier’s failure to deny the charge on that basis. By failing to examine this issue, the MRD violated its mandate to promote the stated purpose of the Texas Workers’ Compensation Act — to ensure the efficient utilization of healthcare by injured workers.

In light of the fact that this CPT was DOP; that Dr. Howell’s letter established that the wrong CPT code was used; and that the supporting documentation consisted of one self-serving letter from the treating doctor, this case cried out for the MRD to exercise its right to audit the claim. Provider should not be allowed to benefit from the MRD’s inaction. At most, if there was a “course” provided, it consisted of thirty minutes of individual instruction to Claimant. This type of one-on-one consultation between doctor and patient would have been more properly billed as an office visit lasting a half hour under CPT code 99203, which has a maximum allowable reimbursement of $74. Evaluation/Management Ground Rules, 1996 Medical Fee Guideline (repealed effective January 1, 2002). The amount billed by Provider in this case was not fair and reasonable.

Carrier is not liable to reimburse Provider any amount for the patient education course regarding the E-Ice machine billed for Claimant.

III. FINDINGS OF FACT

1. In_______ , Claimant injured her knee, an injury compensable under the Texas Workers’ Compensation Act and for which American Home Assurance Company (Carrier) was the responsible insurer.
2. In August 2001, Claimant’s treating doctor and Provider’s employee/owner, Dr. Robert Howell, D.C., prescribed an E-Ice machine to Claimant to provide cold therapy to her knee.
3. Provider billed Carrier $475 under CPT code 99078 for, as he described it, a “lengthy educational class” to educate Claimant on how to use the machine.
4. Carrier denied reimbursement alleging lack of medical necessity.
5. The Texas Workers’ Compensation Commission’s Medical Review Division’s (MRD) decision found that the patient education course was medically necessary, relying on Dr. Howell’s explanation that the course was needed to instruct Claimant.
6. After the Commission’s Medical Review Division ordered reimbursement for the E-Ice Machine, Carrier timely appealed.
7. Pursuant to notice sent by Commission Staff, Carrier and Provider appeared and were represented at the hearing. Staff chose not to participate in the hearing.
8. Provider submitted Dr. Howell’s “Medical Necessity and Explanation Letter for an Educational Class on the E-Ice Machine” to the MRD to explain why Claimant needed, and was provided, an educational course of operation of the machine. The letter further explained the instructions given Claimant during that session. This letter was the only evidence in the record to supporting the medical necessity of the educational course.
9. In the letter, Dr. Howell stated that he personally gave Claimant the course, writing:
10. I demonstrated to [Claimant] how to start the E-Ice system cold therapy treatment. After I showed her, she positioned the knob at the center of the dial (12 o’clock position). . . .I also demonstrated that bending the knees was crucial to this process. I also told and demonstrated her [sic] how to lift with both shoulders so that the weight could be distributed between the two shoulders and not just one. . . (Emphasis added.)
11. Dr. Howell answered Carrier’s interrogatories to Provider as follows:

Interrogatory No. 1: What was the start time and end time of the period Dr. Howell personally spent with [Claimant] on August 30, 2001 instructing her on the E-Ice machine?”

Response to Interrogatory No.1: Dr. Sam Allen personally spent time with [Claimant], not Dr. Howell. Dr. Allen did so under the instruction of Dr. Howell.

Interrogatory No. 2: What was the total number of patients instructed on August 30, 2001 by Dr. Howell regarding the E-Ice machine?

Response to Interrogatory No. 2: None.

Interrogatory No. 3: What was the start time and end time of the period Dr. Howell personally spent with all patients other than [Claimant] on August 30, 2001 instructing them on the E-Ice machine?

Response to Interrogatory No. 3: Dr. Allen spent 30 minutes with [Claimant] on 8-27-2001 for the exam and he spent another 30 minutes explaining how to use the

1. Dr. Howell discredited his own statement by contradicting himself about who actually spoke to Claimant.
2. CPT code 99078 is for physician educational services rendered to patients in a group setting (e.g., prenatal, obesity, or diabetic instructions).
3. The course was billed under the incorrect CPT code because it was not given to a group.
4. The MRD could have, but did not, review the issue of whether $475 was a fair and reasonable charge.

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. LABOR 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.
4. Adequate and timely notice of the hearing was provided in accordance with TEX. 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); 1 TAC § 155.41.
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). 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).
8. The treating doctor is the doctor who is primarily responsible for coordinating the employee’s health care for an injury, and has the specific responsibility for maintaining the efficient utilization of healthcare. 28 TAC § 133.3.
9. The MRD shall review and audit medical services, including treatments administered, services provided, and fees charged. 28 TAC §134.900.
10. Billing under the wrong CPT code is grounds for denial of a claim.
11. The services billed by Provider under CPT code 99078 for Claimant were not medically necessary.
12. Carrier is not liable to reimburse Provider for the billing under CPT code 99078 for Claimant.

ORDER

IT IS ORDERED that American Home Assurance Company is not liable to reimburse First Rio Valley Medical, P.A., for the service it billed under CPT code 99078 for Claimant.

Signed this 27^th day of November, 2002.

ANN LANDEROS
Administrative Law Judge
STATE OFFICE OF ADMINISTRATIVE HEARINGS

1. In one letter, Dr. Howell stated the course was billed under CPT code E0237. (Exh. 1, p. 43). However, the HCFA 1500 form showed the billing was done using CPT 99078.↑
2. 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. (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.↑
3. TEX. LAB. CODE ANN. § 413.016. Payments in Violation of Medical Policies and Fee Guidelines (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.↑
4. The evidence did not establish whether Dr. Howell intentionally or willfully made misleading statements in the letter he provided the MRD. However, an intentionally misleading statement of this nature has potentially serious consequences. A health care provider who willfully or intentionally submits a false or misleading report commits a prohibited practice and is subject to sanction by the Commission. 28 TAC § 42.25.↑