The Texas Department of Insurance (Department), Division of Workers' Compensation (Division) proposes amendments to §§134.110, 134.502, and 134.600, concerning guidelines for medical services, charges and payments. These amendments are primarily necessary to harmonize and make conforming changes to these sections with the Department's recently adopted amendments to 28 Texas Administrative Code (TAC) Chapter 19, Agent's Licensing, Subchapter U, §§19.2001 - 19.2017, concerning Utilization Reviews for Health Care Provided Under Workers' Compensation Coverage (Subchapter U), adopted and published in the February 15, 2013, issue of the Texas Register. Harmonization of these proposed sections with Subchapter U is beneficial because consistency whenever possible benefits both regulated entities and consumers. Because there are statutes that specifically govern utilization review for workers' compensation coverage, there are differences between Subchapter U and 28 TAC Chapter 19, Agent's Licensing, Subchapter R, §§19.1701 - 19.1719, concerning Utilization Review for Health Care Provided Under a Health Benefit Plan or Health Insurance Policy (Subchapter R) as needed to implement and maintain consistency with the relevant statutes. However, because there are utilization review agents that might be subject to both subchapters and these proposed sections, the Division recognizes the importance of consistency for ease of interpretation and compliance. Uniform standards offer a more consistent and efficient utilization review process for enrollees and injured employees, who are equally entitled to the highest quality of utilization review. Furthermore, the proposed amendments to these sections are also important for reasons set out in the adoption order of 28 TAC Chapter 19, Agent's Licensing, Subchapter R, §§19.1701 - 19.1719, and Subchapter U, §§19.2001 - 19.2017, published in the February 15, 2013, issue of the Texas Register (38 TexReg 892). The Division proposes these amendments in conjunction with its proposed amendments to 28 TAC §133.2, concerning Definitions; §133.240, concerning Medical Payments and Denials; 133.250, concerning Reconsideration for Payment of Medical Bills; and §133.305, concerning MDR-General, published in this issue of the Texas Register.

Labor Code §402.00116, concerning Chief Executive, requires the Division to administer and enforce Labor Code Title 5, other workers' compensation laws of this state, and other laws applicable to the Division. The amendments to these proposed rules related to Subchapter U are necessary for the Division to comply with the requirement of Labor Code §413.00114 to regulate and administer the business of workers' compensation in this state and ensure that Labor Code Title 5 and other laws regarding workers' compensation are executed. Additionally, Labor Code §402.00116 requires the Division to administer and enforce Labor Code Title 5, other workers' compensation laws of this state, and other laws applicable to the Division.

Subchapter U became effective on February 20, 2013. The new sections in Subchapter U were necessary, in part, to: (1) implement House Bill (HB) 4290, 81st Legislature, Regular Session, effective September 1, 2009, which revised the definition of "utilization review" in Insurance Code Chapter 4201 to include retrospective reviews; and (2) make other changes necessary for clarity and effective implementation and enforcement of Insurance Code Chapter 4201.

Because the amendments to Subchapter U, in part, apply to prospective and concurrent utilization review and requests for reconsideration under the Texas Workers' Compensation Act, the Division proposes these amendments to §134.600 to harmonize with newly adopted Subchapter U. Primarily, the Division proposes these amendments to: (1) define and incorporate current procedural requirements concerning "adverse determinations" and "reasonable opportunity" and (2) reference the requirements for specifically complying with 28 TAC §19.2009 concerning Notice of Determinations Made in Utilization Review which requires the insurance carrier to include the preauthorization approval number in an approval; §19.2010 concerning Requirements Prior to Issuing Adverse Determination; §19.2011 concerning Written Procedures for Appeal of Adverse Determinations; and §19.2012 concerning URA's Telephone Access and Procedures for Certain Drug Requests and Post-Stabilization Care; all of which address the requirements of issuing an adverse determination.

The Division proposes amendments to §134.110 that are necessary to update this section to conform to other Division rules and Labor Code §408.004 and §408.0041.

The Division also proposes amendments to §134.502 that are necessary to update the language to correspond to the meaning of "adverse determination" in 28 TAC §19.2003(b)(1) concerning Definitions and update the rule to conform to other Division rules and statutes.

An informal draft of this proposal was published on the Division's website from July 29, 2013 to August 19, 2013 and the Division received and considered informal comments. Non-substantive changes have been made throughout the rule text to conform to current nomenclature, re-letter and renumber, and correct typographical and grammatical errors. Non-substantive changes include adding the word "insurance" to "carrier," "injured" to "employee," and deleting the word "Texas" prior to the term "Labor Code."

Proposed Amended §134.110.

Proposed amended §134.110(a)(2) clarifies that an injured employee may request reimbursement from the insurance carrier if the injured employee has incurred travel expenses when the distance traveled to attend a designated doctor examination, required medical examination, or post designated doctor treating or referral doctor examination is greater than 30 miles one-way. Proposed amended §134.110(a)(2) aligns with the provisions in 28 TAC §126.6 and §126.17, concerning Required Medical Examination and Guidelines for Examination by a Treating Doctor or Referral Doctor After a Designated Doctor Examination to Address Issues Other Than Certification of Maximum Medical Improvement and the Evaluation of Permanent Impairment, respectively, and Labor Code §408.004 and §408.0041. 28 TAC §126.6 requires injured employees to submit to required medical examinations and requires insurance carriers to pay for reasonable travel expenses incurred by the employees in submitting to required medical examinations, as specified in 28 TAC Chapter 134 concerning Benefits--Guidelines for Medical Services, Charges, and Payments. 28 TAC §126.17 requires the insurance carriers to reimburse injured employees for all reasonable travel expenses as specified in 28 TAC Chapter 134, Subchapter B, concerning Miscellaneous Reimbursement. Labor Code §408.004(c) pertains to medical examinations that injured employees may be required to submit to and requires insurance carriers pay for those examinations and the reasonable expenses incident to the employees submitting to those examinations. Labor Code §408.0041(h) requires insurance carriers to pay for designated doctor examinations described in Labor Code §408.0041(a), (f), and (f-2), unless it is otherwise prohibited by law, and the reasonable expenses incident to the employee in submitting to the examination.

The effective date in existing §134.110(g) is proposed for deletion because it is no longer necessary. Section 134.110 will become effective 20 days after the date it is filed in the office of the secretary of state in accordance with Government Code §2001.036.

Proposed Amended §134.502.

The proposed amendment to §134.502(b) updates the rule to clarify that doctors shall prescribe in accordance with 28 TAC §134.530 and §134.540 concerning requirements for use of the closed formulary for claims not subject to certified networks and claims subject to certified networks. 28 TAC §134.530 and §134.540 were adopted, effective January 17, 2011, in the December 17, 2010, issue of the Texas Register (35 TexReg 11344).

Proposed amendments to §134.502(d) change the word "pharmacists" to "pharmacies and pharmacy processing agents" to be consistent with other Division rules and statutes related to pharmacy billing. Labor Code §413.0111, relating to processing agents, requires that rules adopted by the commissioner for the reimbursement of prescription medications and services authorize pharmacies to use agents or assignees to process claims and act on the behalf of the pharmacies under terms and conditions agreed on by the pharmacies. 28 TAC §133.307, concerning MDR of Fee Disputes, allows qualified pharmacy processing agents to be requestors in medical fee disputes over the reimbursement of medical bills. 28 TAC §133.10, concerning Required Billing Forms/Formats, contains required billing forms and formats for pharmacies and pharmacy processing agents. Proposed amendments to §134.502(d) also update a rule citation by deleting the outdated citation to 28 TAC §134.800(d) and cite to 28 TAC Chapters 133 and 134.

The proposed amendment to §134.502(e) changes the language from "reasonableness or medical necessity" to "an adverse determination" to correspond with the definition for "adverse determination" in 28 TAC §19.2003(b)(1) and its definition in proposed new §134.600(a)(1).

The proposed amendment to §134.502(f) deletes the word "working" so that the prescribing doctor is required to provide a statement of medical necessity to the requesting party no later than the 14th calendar day after receipt of the request. This change is necessary because the provision of 14 working days unnecessarily delays the receipt of statements of medical necessity from prescribing doctors by pharmacy billing managers and pharmacy processing agents who are required to comply with timeframes contained in Division rules. Additionally, this change from "working" to "calendar" days will allow system participants to more easily monitor the timeframe to provide a statement of medical necessity under the rule for compliance purposes.

Proposed amendments to §134.502(g) delete the citation to 28 TAC §133.304 and add the citation of 28 TAC §133.240 because 28 TAC §133.304, concerning Medical Payments and Denials was repealed and re-codified as 28 TAC §133.240 concerning Medical Payments and Denials in the April 28, 2006, issue of the Texas Register, effective May 2, 2006 (31 TexReg 3544). Proposed amendments to §134.502(g) change the language from "reasonableness or medical necessity" to "an adverse determination" to correspond with the definition for "adverse determination" in 28 TAC §19.2003(b)(1) and its definition in proposed new §134.600(a)(1).

Proposed Amended §134.600(a).

The proposed amendment to §134.600(a)(1) defines "adverse determination" as "a determination by a utilization review agent made on behalf of a payor that the health care services provided or proposed to be provided to an injured employee are not medically necessary or appropriate. The term does not include a denial of health care services due to the failure to request prospective or concurrent utilization review. An adverse determination does not include a determination that health care services are experimental or investigational." This definition corresponds with the definition of that term in 28 TAC §19.2003(b)(1); however, this definition deviates from the statutory definition of "adverse determination" in Insurance Code §4201.002(1) concerning Definitions. The Division must exclude "experimental or investigational services" from the definition of "adverse determination," because Labor Code §408.021 entitles an injured employee subject to either network coverage or non-network coverage to all medically necessary health care services, including experimental and investigational health care services. In addition, pursuant to Insurance Code §4201.054(c), Labor Code, Title 5 prevails if it conflicts with Insurance Code Chapter 4201. The Division also notes that experimental or investigational health care services for injured employees subject to non-network coverage must be preauthorized pursuant to Labor Code §413.014.

The proposed amendment to §134.600(a)(3) adds the word "utilization" and clarifies that concurrent utilization review is "a form of utilization review for on-going health care listed in subsection (q) of this section for an extension of treatment beyond previously approved health care listed in subsection (p) of this section." This definition corresponds with the definition for "concurrent utilization review" in 28 TAC §19.2003(b)(8). Conforming changes inserting the word "utilization" within the context of concurrent utilization review are also proposed in the proposed title of §134.600 and proposed subsections (a)(3), (a)(5), (a)(10), (c)(1)(C), (e), (f), (i)(2), (l), (o), (q), (r), and (t) of proposed §134.600.

The proposed amendment to §134.600(a)(8) redefines "preauthorization" as "a form of prospective utilization review by a payor or a payor's utilization review agent of health care services proposed to be provided to an injured employee." This definition corresponds with the definition of that term in 28 TAC §19.2003(b)(26).

Proposed new §134.600(a)(9) defines "reasonable opportunity" which corresponds with the definition of that term in 28 TAC §19.2003(b)(28).

Proposed Amended §134.600(e).

The proposed amendment to §134.600(e) requires insurance carriers and utilization review agents to comply with the requirements of 28 TAC §19.2012. This amendment is necessary to clarify the combined applications of proposed §134.600(e), 28 TAC §19.2012, and Division rules in 28 TAC Chapter 134, Subchapter F, concerning Pharmaceutical Benefits. This conforming change addresses insurance carriers and utilization review agents who are required to have and implement procedures when responding to requests for drugs that require preauthorization if the injured employee has received or is currently receiving the requested drugs and the adverse determination could lead to a medical emergency. The language "by the insurance carrier" has been deleted because the Division recognizes that the party directly responding to requests for preauthorization may be the insurance carrier if the insurance carrier is a certified utilization review agent or the insurance carrier's utilization review agent.

Proposed Amended §134.600(g).

The proposed amendment to §134.600(g)(3) deletes the language "medical necessity and/or" and "injury/diagnosis." Proposed amended §134.600(g)(3) requires that if denying the request, the insurance carrier shall indicate whether it is issuing an adverse determination, and/or whether the denial is based on an unrelated injury or diagnosis in accordance with §134.600(m). The language has been updated to correspond with the definition for "adverse determination" in 28 TAC §19.2003(b)(1) and to make a non-substantive grammatical change to the term "injury/diagnosis."

Conforming changes to subsections (g)(3) - (5), (h), (i), (m), (o), (o)(1) - (2), (o)(5), and (t) of this section update the use of the term "adverse determination", and delete and replace the outdated terminology referring to denials and issues of medical necessity.

The proposed amendment to §134.600(g)(4) deletes the language "injury/diagnosis" and "the issue of medical necessity." Proposed amended §134.600(g)(4) allows the requestor or injured employee to file an extent of injury dispute upon receipt of an insurance carrier's response which includes a denial due to an unrelated injury or diagnosis, regardless of whether an adverse determination was also issued. The language has been updated to correspond with the definition for "adverse determination" in 28 TAC §19.2003(b)(1) and to make a non-substantive grammatical change to the language "injury/diagnosis."

The proposed amendment to §134.600(g)(5) deletes the language "injury/diagnosis" and "a denial based on medical necessity." Proposed amended §134.600(g)(5) provides that requests which include a denial due to an unrelated injury or diagnosis may not proceed to medical dispute resolution based on the denial of unrelatedness. However requests which include the dispute of an adverse determination may proceed to medical dispute resolution for the issue of medical necessity in accordance with §134.600(o). The language has been updated to correspond with the definition for "adverse determination" in 28 TAC §19.2003(b)(1) and to make a non-substantive grammatical change to the language "injury/diagnosis."

Proposed Amended §134.600(h).

The proposed amendment to §134.600(h) deletes the words "deny requests" to correspond with the definition for "adverse determination" in 28 TAC §19.2003(b)(1), but does not make a substantive change because the new definition of "adverse determination" requires the denial to be based on medical necessity. The proposed amendment to §134.600(h) requires the insurance carrier to "either approve or based solely on the medical necessity of the health care required to treat the injury, issue an adverse determination on each request received by the insurance carrier..." This clarification is necessary to ensure that the requestor is appropriately informed about the utilization review decision of each health care treatment or service listed in the request.

Proposed Amended §134.600(i).

Proposed amendments to §134.600(i) require the insurance carrier to contact the requestor or injured employee within the required timeframes by telephone, facsimile, or electronic transmission with its decision to approve the preauthorization or concurrent utilization review request; issue an adverse determination on the request; or deny the request under §134.600(g) because it relates to an unrelated injury or diagnosis. This amendment is necessary to update the terminology in §134.600(i) to correspond with the definition for "adverse determination" in 28 TAC §19.2003(b)(1). Proposed amendments to §134.600(i)(1) - (2) delete the word "within" because the language "within the following timeframes" has been added to §134.600(i) to clarify the rule.

Proposed Amended §134.600(j).

The proposed amendment to §134.600(j) provides that the insurance carrier is to send written notification of the approval of the request; adverse determination on the request; or denial of the request under §134.600(g) because of an unrelated injury or diagnosis. This amendment is necessary to update the terminology in §134.600(j) to correspond with the definition for "adverse determination" in 28 TAC §19.2003(b)(1).

Proposed Amended §134.600(l).