The Business Council of NYS opposes A. 6686, which would provide a higher reimbursement rate for certain procedures than the APR-DRG inpatient hospital fee schedule adopted by the Workers’ Compensation Board.  This bill is substantially similar to one vetoed by Governor Paterson in 2010, and the Veto Message No. 6795 remains valid today.  Further, changes included within the recently adopted State Budget raise additional concerns with advancing this bill. This legislation does nothing to improve care or outcomes for workers’ compensation claimants; rather it proposes to provide to a very selective group of providers whose procedures utilize implantable hardware with an increased reimbursement rate  -- and only when these procedures are used to treat workers’ compensation claimants.  

Most significantly, and quoting from the Veto Message, the basic purpose the sponsor seeks to accomplish through this bill, “have been addressed administratively.”  The Workers’ Compensation Board, through Subject Number 046-396, issued in January 2010, acting within the scope of its administrative authority, accomplished what this bill seeks to do.  This guidance states, “the requirement of separate reimbursement of implantable hardware and instrumentation costs will apply to spinal procedures in APR-DRG codes 23, 303, 304, 310, and 321.”

Additionally, as part of the Medicaid changes included within the recently adopted state budget, workers’ compensation and no fault rates have been permanently delinked from Medicaid in-patient hospital rates.  The delinking rationale was to ensure that workers’ compensation and no-fault rates do not benefit from negotiated reductions in payments to hospitals as part of the State’s Medicaid program.  The actual impact of this will be an increase in workers’ compensation rates to accommodate this delinking to accommodate increased payments to hospital payments for in-patient treatment to workers’ compensation claimants.

The Department of Health was authorized by state statute to implement a new hospital inpatient payment system in 2009, to provide a more equitable and fair payment method for services being rendered in New York.  This methodology is a severity-based methodology -- All Patient Refined Diagnosis Related Groups (APR-DRGs). The APR-DRG has become the industry standard for assessing resource utilization against large patient populations and allowing an "apples-to-apples" comparison of quality of care and cost effectiveness based on severity of illness, risk of mortality and resource intensity.  The standards are scientifically based, data driven and they are used in many different forms of in-patient health care reimbursement across the country.  Adjustments made reflect the wider availability of input and outcome data. 

The Business Council believes the Workers’ Compensation Board has adequately addressed the concerns raised in this bill as noted in the 2010 Veto Message, and that changes resulting from the adoption of the state budget will undoubtedly put upward pressure on workers’ compensation premiums to accommodate increased payments for in-patient hospital treatment of workers’ compensation claimants. This legislation does not improve care or outcomes for workers’ compensation claimants; rather it proposes to provide to a very selective group of providers whose procedures utilize implantable hardware with an increased reimbursement rate.  

For these reasons, The Business Council opposes this bill.

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