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Thursday, August 18, 2011

State Acts to Restrict Medical Care

The State of NJ has proposed sweeping regulations to limit the payment of medical care under automobile insurance policies, and this action is seen as yet another signal that workers' compensation medical delivery may become even further restricted. In an effort to reduce insurance premiums, the NJ Department of Banking and Insurance, has proposed massive changes in the manner and method that doctors may bill for medical treatment and diagnostic procedures and has restructured the process for appealing a denied claim.

The State claims that medical delivery costs are soaring. It has been reported that for every premium dollar that insurance companies receive, they end up spending $1.23 on medical benefits. The regulations are designed to reduce medical services and produce a profitable insurance product.

Furthermore, the purpose of the regulations are to limit legal costs. The sate reported that in one instance a contested medical  resulted in the payment of $375 in medical benefits, but the legal costs awarded for that recovery were $3,380.

The regulations prohibit the use of innovative radiological diagnostic testing. "X-ray digitization or computer aided radiographic mensuration reported under CPT 76499 or any other code are not reimburseable under PIP."

The comment period for the new rules runs thorough early September 2011. The impact of the regulations is to reduce medical care and diagnostic procedures that will impact resulting workers' compensation benefits. Ironically providing the best medical benefits available would seemingly comply with the intent of the compensation act and ultimately economically benefit the employer by producing a healthy workforce, The process of cost cutting will only ultimately degrade the medical delivery component of workers' compensation even further.

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