Pennsylvania Statutes Title 77 P.S. Workers' Compensation § 531. Surgical and medical services and supplies;  designation by employer;  artificial limb or eye

(1)(i) The employer shall provide payment in accordance with this section for reasonable surgical and medical services, services rendered by physicians or other health care providers, including an additional opinion when invasive surgery may be necessary, medicines and supplies, as and when needed.  Provided an employer establishes a list of at least six designated health care providers, no more than four of whom may be a coordinated care organization and no fewer than three of whom shall be physicians, the employe shall be required to visit one of the physicians or other health care providers so designated and shall continue to visit the same or another designated physician or health care provider for a period of ninety (90) days from the date of the first visit:  Provided, however, That the employer shall not include on the list a physician or other health care provider who is employed, owned or controlled by the employer or the employer's insurer unless employment, ownership or control is disclosed on the list.  Should invasive surgery for an employe be prescribed by a physician or other health care provider so designated by the employer, the employe shall be permitted to receive an additional opinion from any health care provider of the employe's own choice.  If the additional opinion differs from the opinion provided by the physician or health care provider so designated by the employer, the employe shall determine which course of treatment to follow:  Provided, That the second opinion provides a specific and detailed course of treatment.  If the employe chooses to follow the procedures designated in the second opinion, such procedures shall be performed by one of the physicians or other health care providers so designated by the employer for a period of ninety (90) days from the date of the visit to the physician or other health care provider of the employe's own choice.  Should the employe not comply with the foregoing, the employer will be relieved from liability for the payment for the services rendered during such applicable period.  It shall be the duty of the employer to provide a clearly written notification of the employe's rights and duties under this section to the employe.  The employer shall further ensure that the employe has been informed and that he understands these rights and duties.  This duty shall be evidenced only by the employe's written acknowledgment of having been informed and having understood his rights and duties.  Any failure of the employer to provide and evidence such notification shall relieve the employe from any notification duty owed, notwithstanding any provision of this act to the contrary, and the employer shall remain liable for all rendered treatment.  Subsequent treatment may be provided by any health care provider of the employe's own choice.  Any employe who, next following termination of the applicable period, is provided treatment from a nondesignated health care provider shall notify the employer within five (5) days of the first visit to said health care provider.  Failure to so notify the employer will relieve the employer from liability for the payment for the services rendered prior to appropriate notice if such services are determined pursuant to paragraph (6) to have been unreasonable or unnecessary.

(ii) In addition to the above service, the employer shall provide payment for medicines and supplies, hospital treatment, services and supplies and orthopedic appliances, and prostheses in accordance with this section.  Whenever an employe shall have suffered the loss of a limb, part of a limb, or an eye, the employer shall also provide for an artificial limb or eye or other prostheses of a type and kind recommended by the doctor attending such employe in connection with such injury and any replacements for an artificial limb or eye which the employe may require at any time thereafter, together with such continued medical care as may be prescribed by the doctor attending such employe in connection with such injury as well as such training as may be required in the proper use of such prostheses.  The provisions of this section shall apply to injuries whether or not loss of earning power occurs.  If hospital confinement is required, the employe shall be entitled to semiprivate accommodations, but, if no such facilities are available, regardless of the patient's condition, the employer, not the patient, shall be liable for the additional costs for the facilities in a private room.

(iii) Nothing in this section shall prohibit an insurer or an employer from contracting with any individual, partnership, association or corporation to provide case management and coordination of services with regard to injured employes.

(2) Any provider who treats an injured employe shall be required to file periodic reports with the employer on a form prescribed by the department which shall include, where pertinent, history, diagnosis, treatment, prognosis and physical findings.  The report shall be filed within ten (10) days of commencing treatment and at least once a month thereafter as long as treatment continues.  The employer shall not be liable to pay for such treatment until a report has been filed.

(3)(i) For purposes of this clause, a provider shall not require, request or accept payment for the treatment, accommodations, products or services in excess of one hundred thirteen per centum of the prevailing charge at the seventy-fifth percentile;  one hundred thirteen per centum of the applicable fee schedule, the recommended fee or the inflation index charge;  one hundred thirteen per centum of the DRG payment plus pass-through costs and applicable cost or day outliers;  or one hundred thirteen per centum of any other Medicare reimbursement mechanism, as determined by the Medicare carrier or intermediary, whichever pertains to the specialty service involved, determined to be applicable in this Commonwealth under the Medicare program for comparable services rendered.  If the commissioner determines that an allowance for a particular provider group or service under the Medicare program is not reasonable, it may adopt, by regulation, a new allowance.  If the prevailing charge, fee schedule, recommended fee, inflation index charge, DRG payment or any other reimbursement has not been calculated under the Medicare program for a particular treatment, accommodation, product or service, the amount of the payment may not exceed eighty per centum of the charge most often made by providers of similar training, experience and licensure for a specific treatment, accommodation, product or service in the geographic area where the treatment, accommodation, product or service is provided.

(ii) Commencing on January 1, 1995, the maximum allowance for a health care service covered by subparagraph (i) shall be updated as of the first day of January of each year.  The update, which shall be applied to all services performed after January 1 of each year, shall be equal to the percentage change in the Statewide average weekly wage.  Such updates shall be cumulative.

(iii) Notwithstanding any other provision of law, it is unlawful for a provider to refer a person for laboratory, physical therapy, rehabilitation, chiropractic, radiation oncology, psychometric, home infusion therapy or diagnostic imaging, goods or services pursuant to this section if the provider has a financial interest with the person or in the entity that receives the referral.  It is unlawful for a provider to enter into an arrangement or scheme such as a cross-referral arrangement, which the provider knows or should know has a principal purpose of assuring referrals by the provider to a particular entity which, if the provider directly made referrals to such entity, would be in violation of this section.  No claim for payment shall be presented by an entity to any individual, third-party payer or other entity for a service furnished pursuant to a referral prohibited under this section.

(iv) The secretary shall retain the services of an independent consulting firm to perform an annual accessibility study of health care provided under this act.  The study shall include information as to whether there is adequate access to quality health care and products for injured workers and a review of the information that is provided.  If the secretary determines based on this study that as a result of the health care fee schedule there is not sufficient access to quality health care or products for persons suffering injuries covered by this act, the secretary may recommend to the commissioner the adoption of regulations providing for a new allowance.

(v) An allowance shall be reviewed for reasonableness whenever the commissioner determines that the use of the allowance would result in payments more than ten per centum lower than the average level of reimbursement the provider would receive from coordinated care insurers, including those entities subject to the act of December 29, 1972 (P.L. 1701, No. 364),  1 known as the “Health Maintenance Organization Act,” and those entities known as preferred provider organizations which are subject to section 630 of the Insurance Company Law of 1921  2 for like treatments, accommodations, products or services.  In making this determination, the commissioner shall consider the extent to which allowances applicable to other providers under this section deviate from the reimbursement such providers would receive from coordinated care insurers.  Any information received as a result of this subparagraph shall be confidential.

(vi) (A) The reimbursement for drugs and professional pharmaceutical services shall be limited to one hundred ten per centum of the average wholesale price (AWP) of the product, calculated on a per unit basis, as of the date of dispensing.

(B) A physician seeking reimbursement for drugs dispensed by a physician shall include the original manufacturer's National Drug Code (NDC) number, as assigned by the Food and Drug Administration, on the bills and reports required under this section.

(C) In no event may a physician seek reimbursement in excess of one hundred ten per centum of the AWP of the drugs dispensed by a physician as determined by reference to the original manufacturer's NDC number.

(D) A repackaged NDC number may not be used and will not be considered the original manufacturer's NDC number.  If a physician seeking reimbursement for drugs dispensed by a physician does not include the original manufacturer's NDC number on the bills and reports required by this section, reimbursement shall be limited to one hundred ten per centum of the AWP of the least expensive clinically equivalent drug, calculated on a per unit basis.

(E) No outpatient provider, other than a pharmacy licensed in this Commonwealth or another state, may do any of the following:

(I) Seek reimbursement for a drug listed on Schedule II in section 4(2) of the act of April 14, 1972 (P.L. 233, No. 64),   3 known as the “Controlled Substance, Drug, Device and Cosmetic Act,” dispensed in excess of one initial seven-day supply, commencing upon the employe's initial treatment by a health care provider for an injury related to a specific workers' compensation claim.  Should the employe require a medical procedure, including surgery, one additional fifteen-day supply can be dispensed commencing on the date of the medical procedure.

(II) Seek reimbursement for a drug listed on Schedule III in section 4(3) of the “Controlled Substance, Drug, Device and Cosmetic Act,” which contains hydrocodone dispensed in excess of one initial seven-day supply, commencing upon the employe's initial treatment by a health care provider for an injury related to a specific workers' compensation claim.  Should the employe require a medical procedure, including surgery, one additional fifteen-day supply can be dispensed commencing on the date of the medical procedure.

(III) Seek reimbursement for any other drug dispensed in excess of one initial thirty-day supply, commencing upon the employe's initial treatment by a health care provider under the particular workers' compensation claim.

(IV) Seek reimbursement for any drugs dispensed within any period of time in excess of the limitations under subprovision (I), (II) and (III).  If one health care provider has dispensed drugs under subprovision (I), (II) or (III), no other health care provider may submit for reimbursement for drugs dispensed to that employe under the same workers' compensation claim.

(F) Reimbursement for all drugs dispensed in accordance with this subsection shall be made at the rates set forth in this section.

(G) No outpatient provider, other than a pharmacy licensed in this Commonwealth or another state, may seek reimbursement for an over-the-counter drug.

(H) The Workers' Compensation Advisory Council shall annually conduct a study of the impact of this subclause, including calculation of the savings achieved in the dispensing of pharmaceuticals.

(I) For purposes of this subclause, clinical equivalence, in reference to a drug, means the drug has chemical equivalents which, when administered in the same amounts, will provide essentially the same therapeutic effect as measured by the control of a symptom or a disease.

(vii) The applicable Medicare fee schedule shall include fees associated with all permissible procedure codes.  If the Medicare fee schedule also includes a larger grouping of procedure codes and corresponding charges than are specifically reimbursed by Medicare, a provider may use these codes, and corresponding charges shall be paid by insurers or employers.  If a Medicare code exists for application to a specific provider specialty, that code shall be used.

(viii) A provider shall not fragment or unbundle charges imposed for specific care except as consistent with Medicare.  Changes to a provider's codes by an insurer shall be made only as consistent with Medicare and when the insurer has sufficient information to make the changes and following consultation with the provider.

(4) Nothing in this act shall prohibit the self-insured employer, employer or insurer from contracting with a coordinated care organization for reimbursement levels different from those identified above.

(5) The employer or insurer shall make payment and providers shall submit bills and records in accordance with the provisions of this section.  All payments to providers for treatment provided pursuant to this act shall be made within thirty (30) days of receipt of such bills and records unless the employer or insurer disputes the reasonableness or necessity of the treatment provided pursuant to paragraph (6).  The nonpayment to providers within thirty (30) days for treatment for which a bill and records have been submitted shall only apply to that particular treatment or portion thereof in dispute;  payment must be made timely for any treatment or portion thereof not in dispute.  A provider who has submitted the reports and bills required by this section and who disputes the amount or timeliness of the payment from the employer or insurer shall file an application for fee review with the department no more than thirty (30) days following notification of a disputed treatment or ninety (90) days following the original billing date of treatment.  If the insurer disputes the reasonableness and necessity of the treatment pursuant to paragraph (6), the period for filing an application for fee review shall be tolled as long as the insurer has the right to suspend payment to the provider pursuant to the provisions of this paragraph.  Within thirty (30) days of the filing of such an application, the department shall render an administrative decision.

(6) Except in those cases in which a workers' compensation judge asks for an opinion from peer review under section 420,  4 disputes as to reasonableness or necessity of treatment by a health care provider shall be resolved in accordance with the following provisions:

(i) The reasonableness or necessity of all treatment provided by a health care provider under this act may be subject to prospective, concurrent or retrospective utilization review at the request of an employe, employer or insurer.  The department shall authorize utilization review organizations to perform utilization review under this act.  Utilization review of all treatment rendered by a health care provider shall be performed by a provider licensed in the same profession and having the same or similar specialty as that of the provider of the treatment under review.  Organizations not authorized by the department may not engage in such utilization review.

(ii) The utilization review organization shall issue a written report of its findings and conclusions within thirty (30) days of a request.

(iii) The employer or the insurer shall pay the cost of the utilization review.

(iv) If the provider, employer, employe or insurer disagrees with the finding of the utilization review organization, a petition for review by the department must be filed within thirty (30) days after receipt of the report.  The department shall assign the petition to a workers' compensation judge for a hearing or for an informal conference under section 402.1.  5  The utilization review report shall be part of the record before the workers' compensation judge.  The workers' compensation judge shall consider the utilization review report as evidence but shall not be bound by the report.

(7) A provider shall not hold an employe liable for costs related to care or service rendered in connection with a compensable injury under this act.  A provider shall not bill or otherwise attempt to recover from the employe the difference between the provider's charge and the amount paid by the employer or the insurer.

(8) If the employe shall refuse reasonable services of health care providers, surgical, medical and hospital services, treatment, medicines and supplies, he shall forfeit all rights to compensation for any injury or increase in his incapacity shown to have resulted from such refusal.

(9) The payment by an insurer or employer for any medical, surgical or hospital services or supplies after any statute of limitations provided for in this act shall have expired shall not act to reopen or revive the compensation rights for purposes of such limitations.

(10) If acute care is provided in an acute care facility to a patient with an immediately life threatening or urgent injury by a Level I or Level II trauma center accredited by the Pennsylvania Trauma Systems Foundation under the act of July 3, 1985 (P.L. 164, No. 45),  6 known as the “Emergency Medical Services Act,” or to a burn injury patient by a burn facility which meets all the service standards of the American Burn Association, or if basic or advanced life support services, as defined and licensed under the “Emergency Medical Services Act,” are provided, the amount of payment shall be the usual and customary charge.

1 40 P.S. § 1551 et seq.
2 40 P.S. § 764a.
3 35 P.S. § 780-104.
4 77 P.S. §§ 831, 832.
5 77 P.S. § 711.1.
6 35 P.S. § 6921 et seq. (repealed);  see now, 35 Pa.C.S.A. § 8101 et seq.

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