STATE OF MONTANA
DEPARTMENT OF LABOR AND INDUSTRY
HEARINGS BUREAU
IN THE MATTER OF |
) | Case No. 327-2002 |
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MONTANA REHABILITATION THERAPY, |
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Petitioner, |
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FINDINGS OF FACT; |
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vs. |
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CONCLUSIONS OF LAW; |
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AND ORDER |
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CONSTITUTION STATE SERVICES, |
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Respondent. |
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I. INTRODUCTION
Montana Rehabilitation Therapy filed a request
for a contested case hearing before the Department on the basis that Constitution
State Services denied payment for medical services provided to Dan Maggard
on April 3, 2001. Michael T. Furlong, Hearing Officer, conducted a hearing
in this matter on November 29, 2001. Steve Botten, co-owner of Billings
Surgical Group, represented the petitioner. Linda Botten and Lorena Pettet
appeared as petitioner witnesses. Constitution State Services was represented
by Anna Creed, Attorney at Law. Diane Nelson appeared as a respondent witness.
Petitioner exhibits 2 through 5 and Respondent exhibits A through L were
admitted into evidence without objection. The Hearing Officer admitted Petitioner
exhibit 1 over Respondent's hearsay objection.
II. ISSUE
Whether Montana Rehabilitation Therapy requested prior authorization with
Constitution State Services for services rendered to Dan Maggard on April
3, 2001, as required under ARM 24.29.1517.
III. FINDINGS OF FACT
1. Dan Maggard suffered a work-related injury on March 30, 2001, for which he sought initial treatment from Dr. Michael Layman. Upon examination, Dr. Layman diagnosed Maggard with an acute lower back sprain, and referred him to Montana Rehabilitation Therapy (MRT) for further rehabilitation treatment.
2. Maggard reported to MRT for initial evaluation by a licensed physical therapist on April 2, 2001.
3. On April 2, 2001, MRT contacted an adjuster with Constitution State Services (CSS) to obtain prior authorization before providing evaluation and treatment services for Maggard. The adjuster verbally gave authorization for the treatment provided to Maggard on that date.
4. Maggard reported for his evaluation appointment on April 2. Following the appointment, MRT scheduled a second therapy session for Maggard on April 3, 2001. Maggard received a physical therapy treatment as scheduled on April 3.
5. On April 4, 2001, MRT sent a facsimile request to CSS for authorization to provide physical therapy for Maggard. It sent a statement signed by Dr. Layman certifying that Maggard needed continued treatment by a physical therapist to include a total of six therapy sessions. It also sent CSS a medical status report signed by Dr. Layman on April 2, 2001, which indicated that he had seen Maggard for back sprain injury and referred him for physical therapy treatment. Dr. Layman determined that Maggard was unable to return to work and was to be re?examined in 3 to 4 days.
6. Upon receiving the facsimile, CSS sent a response via facsimile to MRT on April 4, authorizing six physical therapy sessions for Maggard effective April 6, 2001.
7. Maggard reported for a subsequent physical therapy appointment at MRT on April 6, 2001.
8. As the insurance carrier, CSS accepts liability for Maggard's job-related injury.
9. On April 25, 2001, CSS notified MRT by letter that it had received bills for therapy provided to Maggard on April 2, April 3, and April 6, 2001. It authorized the evaluation and treatment on April 2, and the therapy session on April 6, 2001. However, it denied payment, in the amount of $138.55, for services provided to Maggard on April 3, 2001, indicating that it had no record of prior authorization sought or given for that session.
10. Linda Botten has been the corporation president since 1991 and has worked extensively with insurance companies, including CSS, involving requests for prior authorization. In the typical course of care for patients referred by a physician, it has been customary for them to authorize a certain number of physical therapy visits. In her experience working with CSS, once the initial evaluation has been approved for individuals with acute therapy needs, there has never been refusal to authorize follow up visits in the typical course of care. For that reason, MRT, scheduled the physical therapy session on April 3.
IV. DISCUSSION/RATIONALE
The workers' compensation laws provide for the department to regulate costs
for medical services. § 39-71-704, MCA. Therefore, the department has
adopted rules requiring medical providers to obtain prior authorization
of treatment costs in certain circumstances. The department rules provide:
24.29.1517 PRIOR AUTHORIZATION (1) When prior authorization is required, the provider must request the authorization a reasonable amount of time in advance of the time the procedure is scheduled to be performed. The request must contain enough information to allow the insurer to make an informed decision regarding authorization. The insurer may not unreasonably withhold its authorization. An insurer's denial must contain an explanation of the reasons for its denial. Reasonableness will be judged in light of the circumstances surrounding the medical procedure and the claim.(4) Prior authorization is required when:
(a) the provider to whom the referral is made is a consulting specialist; or
(e) any of the following is proposed:
(ix) any physical rehabilitation program involving work hardening, physical restoration, or similar programs.
(6) Prior authorization is not required for emergency procedures.
Pursuant to the law, a provider is required
to request prior authorization if a patient is to be treated for a non-emergency
condition.
As the provider in this case, MRT requested authorization from the insurance
company for the treatment provided Maggard on April 3, 2001, on the basis
that they had obtained prior authorization to provide services to Maggard.
CSS contends that MRT did not request and was not given prior authorization
for the treatment, and that, therefore, costs for the medical services provided
on April 3, 2001, should be denied.
The record shows that when MRT received a prescription for physical therapy
from the injured worker's physician, it contacted the insurer on April 2,
2001, for the purpose of obtaining 'prior authorization' as required under
the law. The disputed facts in this case center around whether or not the
authorization given by the adjuster should include the treatment provided
on April 3, 2001. The extent of the authorization given on April 2, 2001
was strictly oral between the parties and the insurer did not maintain written
documentation concerning the request.
The insurer contends that the adjuster granted authorization, but only for
Maggard's initial visit on April 2, 2001. In support of its decision to
deny payment, it refers to the testimony of the adjuster who said she granted
authorization only for the initial evaluation conducted on April 2, 2001.
It also refers to the medical status appointment report (Exhibit 2) faxed
on April 4, 2001, where MRT indicated that Maggard's next appointment date
was set for April 6, 2001. Therefore, since MRT did not provide the medical
status report until after the injured worker's April 3, 2001 appointment,
MRT failed in its obligation to request prior authorization for those services.
On the other hand, MRT argues that it followed customary past practice in
its request to obtain prior authorization from CSS. It was MRT's intention
to obtain the regulatory prior authorization so it could begin the continued
physical therapy of Maggard when it contacted the adjuster on April 2, 2001.
The call made to the adjuster was the customary procedure it had always
followed, and its requests for authorization by insurers to proceed with
continued physical therapy have always been granted so an injured worker
can return to work as soon as possible. MRT understood that it had received
authorization to proceed with the necessary prescribed physical therapy.
For that reason, it scheduled an appointment and proceeded with Maggard's
treatment on April 3, 2001, as determined during his initial evaluation.
It was not until after the April 3, 2001 treatment was performed that MRT
received written notice from the insurer denying payment for the treatment
because CSS records did not show that prior authorization had been sought
or given.
Under the circumstances, upon contacting the insurer on April 2, 2001, Montana
Rehabilitation Therapy had reason to believe that it had followed the required
procedures and had been given prior authorization to provide continued prescribed
treatment. Therefore, Montana Rehabilitation Therapy, as the provider in
this case, did request prior authorization in advance of the procedures
performed on the injured worker on April 3, 2001 as required under the provisions
of ARM 24.29.1517.
V. CONCLUSIONS OF LAW
1. The State of Montana and the Commissioner of the Department of Labor
and Industry has jurisdiction over this complaint under §§39-71-704
(6) and 39-71-2401, MCA.
2. Montana Rehabilitation Therapy made a request for prior authorization
as required pursuant to ARM 24.29.1517. Therefore, it is entitled to payment
for the services.
VI. ORDER
Montana Rehabilitation Therapy's request for payment for treatment of Dan
Maggard on April 3, 2001, is granted.
Constitution State Services is ORDERED to pay the billed /amount of $138.55
for treatment received by Dan Maggard on April 3, 2001.
DATED this 27th day of December, 2001.
DEPARTMENT OF LABOR & INDUSTRY
HEARINGS BUREAU
By: /s/ Michael T. Furlong
Michael T. Furlong
Hearing Officer
Notice: This Order is signed by the Hearing Officer of the Department of
Labor and Industry under authority delegated by the Commissioner. Any party
in interest may appeal this Order to the Workers' Compensation Court within
thirty (30) days after the date of mailing of this Order as provided in
ARM 24.29.215(3). The Court's address is:
Workers Compensation Court
P.O. Box 537
Helena, MT 59624-0537
(406) 444-7794