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COMMISSIONER'S BULLETIN # B-0009-07

May 01, 2007


To: Parties to DWC Hospital Outpatient Fee Disputes


Re: Medical Fee Dispute Resolution Update

The Texas Department of Insurance, Division of Workers' Compensation, Medical Fee Dispute Resolution staff will be issuing findings and decisions regarding pending hospital outpatient fee disputes. The Division performed an initial review and grouped together many disputes involving similar issues, information, and documentation. Based upon the initial review, the Division notifies the Parties that they may still submit additional information relevant to the "fair and reasonable" reimbursement standard described in 28 Tex. Admin. Code §134.1 (c) (3) and (d).

Hospitals should substantiate the request for additional reimbursement in a dispute. Hospitals are encouraged to submit information that specifically reflects the rule requirements and statutory criteria specified in section 413.011(d) of the Texas Labor Code. For example, supporting information may be documents showing typical payment amounts received for similar services during the same time period for injured persons of an equivalent standard of living. Those payments could reflect reimbursement from a variety of payors, including managed care, group health, and Medicare. Supporting information may also include documents showing average payments as a percent of total charges from representative Texas workers' compensation carriers during that same time period for a significant number of similar cases. Documentation from only one payor or a limited number of similar cases may not be sufficient to make a determination of the standard for fair and reasonable. If a hospital chooses to supplement its request for additional reimbursement, the Division requests that the hospital provide two (2) copies of the additional information and documentation submitted.

Upon receipt by the Division, a copy of any additional information received from the hospitals will be provided to the insurance carriers (carriers). Carriers may respond to the additional information submitted by the hospitals. Any response from the carrier should support that the initial payment made met the criteria of fair and reasonable reimbursement and should provide rationale for the carrier's methodology. For example, if a carrier asserts that a methodology or amount in the Division's inpatient hospital fee guideline or separate methodology was utilized to establish the existing payment, the carrier should explain what was utilized and justify how that payment meets the "fair and reasonable" requirements.

All relevant information and responses to that information received will be considered by the Division's Medical Fee Dispute Resolution Officers. This process will be time-consuming and the Parties are encouraged to seek informal resolution of these disputes with settlement negotiations or mediation. Upon settlement, the hospital should notify the Division of a withdrawal of a dispute. Further, if both Parties to any particular hospital outpatient fee dispute request in writing that consideration of their dispute be postponed, the Division will allow a reasonable delay period. The Parties jointly should direct any such requests to postpone to the contact information provided below. Parties may also contact the Director of Medical Fee Dispute Resolution if they need assistance in obtaining mediation services.

Please note, if a hospital's billings or a carrier's payments do not reflect compliance with applicable statutes and rules, the Division may initiate an appropriate enforcement action.

If there are any questions regarding the information in this update, please contact Amy Rich at 512-804-4812 or email Medical Fee Dispute Resolution at MDRInquiry@tdi.state.tx.us .

Albert Betts

Commissioner of Workers' Compensation

Texas Department of Insurance



Last updated: 09/07/2014

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