August 22, 2016
CWCI Study Measures the Impact of the RBRVS Fee Schedule in California Workers Comp
Oakland – A new study shows that as the California workers’ comp system began to transition to a Resource Based Relative Value Scale (RBRVS) fee schedule for physician and non-physician medical services, there was a major shift in where the medical dollars flow, so as intended, primary care providers now get a bigger share of covered fees and specialists get less.
The California Workers’ Compensation Institute (CWCI) study, based on 11.4 million medical services provided to injured workers in the first 10 months of 2013, 2014, and 2015 shows that there were across-the-board reductions in the volume of services in 2014 and 2015, the first two years of the transition to the RBRVS schedule mandated by 2012 workers’ comp reforms. The amount of the reductions varied by the type of care, ranging from 11.4% for radiology services to 49.5% for medicine services (comprised primarily of ancillary services such as cardiovascular, nerve and muscle testing, and psychiatric testing and psychotherapy), with an overall reduction of 17.7% in all medical services. At the same time, changes in total amounts paid under the schedule ranged from a 44.9% reduction in medicine services to a 12.7% increase in physical medicine services, for a net reduction of 14.3% in payments for all services. The number of unique claims associated with eight fee schedule service categories showed similar variability as the RBRVS schedule was implemented, but within a narrower range (from a 26.5% decline in claims with medicine services to a 2.2% increase in claims with evaluation and management services), for a net decline of 3.3% in the number of unique claims for all services.
Calculating the weighted average amounts paid for services in the eight service categories, the study found that despite the reductions in the volume of services, the average amounts paid to providers increased in the four categories that account for the bulk of the medical care rendered to injured workers, with increases of 9.2% for medicine services, 16.5% for surgery services, 25.3% for evaluation and management, and 28.1% for physical medicine. On the flip side, reductions were noted for anesthesiology, pathology, radiology, and special services (where the decline was primarily due to lower report costs which reflect the new schedule’s elimination of separate fees for consultation reports, which in most cases were incorporated into the underlying evaluation service fee). Given the distribution of workers’ compensation medical services among the eight service categories, the reductions in the average amounts paid for the ancillary services were more than offset by the increases in the primary service categories, so overall, the weighted average amount paid for all service codes under the RBRVS schedule increased 4.2% (from $74.10 in 2013 to $77.20 in 2015).
To provide a detailed look at the utilization and reimbursement of workers’ compensation medical services during the first two years of the transition to the RBRVS-based fee schedule, the study also identified the top 10 services in the eight fee schedule categories for service years 2013, 2014 and 2015, based on the total volume of services and total payments, then noted the changes in the payment and service distributions, the rankings of the top 10 services, and the amounts paid per code. The exhibits and analyses for the individual service categories, along with more background information, graphics and findings from the RBRVS outcomes study have been published in a CWCI Report to the Industry, “Impact of the RBRVS Fee Schedule on California Workers’ Comp Physician and Non-Physician Practitioner Service Payments,” which is available to Institute CWCI members and subscribers in the Research section of its website, www.cwci.org, or available for purchase at www.cwci.org/store.html.
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