Texas Regulatory Update

by Jaelene Fayhee

TexasFlagThe Texas Department of Insurance-Division of Workers’ Compensation held a Quarterly Insurance Carrier meeting on October 23, 2013. Presentations from the meeting will be posted on TDI-DWC’s System Monitoring and Oversight webpage. To help you sift through all this information, myMatrixx’s Jaelene Fayhee, Compliance and Govt. Affairs Director, has provided a summary of key points presented during the meeting here.

1. Pharmacy Formulary

In November 2013, the TDI-DWC will begin posting on its website the entire Appendix A.  Appendix A lists both “Y” and “N” status drugs.  Appendix A provides a complete listing of “N” status drugs, which require preauthorization.  Matt Zurek, Executive Deputy Commissioner Healthcare Management and Monitoring, noted that this table is provided as a convenience only and is not a substitute for the current edition of ODG Treatment in Workers’ Comp/Appendix A: ODG Workers’ Compensation Drug Formulary.  Mr. Zurek also noted that the Closed Formulary includes all FDA approved drugs. The “N” Drug list can be accessed here.

Amy Lee, Special Deputy Commissioner Policy and Research, reported that TDI-DWC plans to issue the third and final Pharmacy Closed Formulary Data Call of Legacy claims by the end of October or early November.

2. EDI (Electronic Data Exchange)

TDI-DWC staff emphasized that each insurance carrier is required to designate one individual as the EDI Compliance Coordinator per Rule 134.808.  TDI-DWC monitors medical and claims EDI submissions and will direct all questions regarding EDI reporting to the insurance carrier’s EDI Compliance Coordinator. myMatrixx will assist clients with responding to any all inquiries from TDI-DWC regarding medical EDI submissions.

The EDI Medical Data issues that TDI-DWC is monitoring include the volume of medical bills (professional, RX, etc), NPI, Claim Adjustment Reason Codes (CARC) 131 and W3. NPI, DN 507. Claim adjustment reason code 131’s definition is “Claim specific negotiated discount”. Ms. Lee said this code generally should not be used in Texas and that the CARC W3 is required to be reported for reconsiderations.  DN 507 is the data element used to report whether or not a service is in-network.

During the Enforcement update portion of the meeting, Leah Gillum reported “EDI issues have made it to enforcement”.  She stated that that there are 194 pending enforcement cases and insurance carriers are the subject of 63 of the 194 cases. Ms. Gillum said she expects at least 100 more EDI cases to be referred to Enforcement. She noted that almost every workers’ compensation carrier would be contacted and that warning letters would be sent as early as next week.  The predominant EDI issue is reporting of the health care provider’s NPI number. Bills for professional services may include information on referring provider, rendering provider and billing provider.  If the NPI number is present on a bill for any of these providers, the NPI number must be reported. For pharmacy bills, the prescribing doctor’s NPI number and the pharmacy’s NPI or NCPDP number must be reported. NPI stands for National Provider Identification and NCPDP is an acronym for the National Council for Prescription Drug Programs.

Insurance carriers expressed concern with enforcement initiatives and requested that TDI-DWC provide EDI training for carrier’s EDI Compliance Coordinators. myMatrixx is committed to working with our clients to ensure medical EDI data is submitted timely and accurately.

3. PBO

Teresa Carney, Director System Monitoring and Oversight, reported that the 2014 Insurance Carrier Methodology is expected to be finalized in early November.  The income benefit measures are not expected to change.  The medical bill measures are expected to include both original bills and reconsiderations.  The data time frame that will be used to assess carrier performance will be January 1, 2014 through June 30, 2014.

4. Research and Policy Update

Ms. Lee presented statistics on indemnity dispute resolution (# of disputed claims, # of BRCs, # of CCHs, etc).  As mentioned above, the presentations from the meeting will be posted on TDI-DWC’s “System Monitoring and Oversight” webpage.

Ms. Lee also reported on TDI-DWC’s rulemaking activities, which include the following:

1. Proposed changes to Rule 133.10 concerning the new CMS 1500 form (billing form for professional services) – public comments are due November 12, 2013
2. Proposed “Companion URA Rules” have been submitted to the Texas Register. Public comment deadline will be December 2, 2013.
3. TDI-DWC plans to post an informal draft of changes to Rule 124.5 in early November. The draft changes will be related to debit cards.
4. Other proposed rule changes that may be initiated include changes to SOAH rules, attorney fee rules and/or Lifetime income benefit rules.

If you have any questions regarding this report and/or need additional information, please contact Jaelene Fayhee, Compliance and Govt. Affairs Director at myMatrixx at jfayhee@