By Jon Coppelman
Lynch Ryan & Associates

Nearly a year ago we blogged the issue of a medical fee schedule in Maine. The legislature mandated the creation of a fee schedule way back in 1991. Twenty years later, there have been a few reports, a few changes in the membership of the committee trying to establish the fee schedule and, to date, no fee schedule.

We now wonder whether neighboring New Hampshire will follow Maine's example, climbing a slippery mountain trail into a deep fog.

New Hampshire, like Maine, has a two tiered system: in the first tier are managed care networks, which negotiate fees with doctors and hospitals. Everyone in the second tierthose outside the networks, the self-insured, smaller carriers, etc.are stuck with paying the "usual and customary fees." Medical costs account for 71% of total costsa truly staggering number when compared to the national average of 58%.

Dr. Gary Woods, an orthopedic surgeon and chair of the New Hampshire Workers' Comp Advisory Council, thinks that the high percentage of medicals is the result of good medical care, combined with a strong return-to-work focus: in other words, indemnity is relatively low because workers are not out of work very long. Well, doc, show me the numbers. I expect that New Hampshire ranked 14th highest among states for comp costsis spending too much on indemnity and way too much on medical services. It's no bargain for anyone.

The Fix is (Not Quite) In

The New Hampshire legislature is contemplating SB 71, which would impose a fee schedule on medical services. The bill proposes that hospitals be reimbursed at a uniform conversion rate of up to 150% of Medicare rates. While somewhat on the high side for such linked payments, it would probably bring down the overall costs of medical services in the state.

SB 71 is going nowhere, at least for the moment. The bill will remain in committee while the lawmakers appoint a study group to review the proposal and make further recommendations.

Ultimately, the details of the fee schedule will be in the hands of the comp advisory council, of which Dr. Woods is the chair. Hmm. This brings to mind the stalemate in Maine, where Dr. Paul Dionne was for a long time chair of the committee responsible for implementing the fee schedule. The group just couldn't come up with a number that would satisfy the doctors. (How would a doctor define a fair fee schedule? "Usual and customary." ) Last June, facing allegations of a conflict of interest, Dr. Dionne finally stepped aside.

Perhaps the good folks in New Hampshire could speed up the fee schedule project by asking Dr. Woods to step aside. No doctor is going to embrace a cut in reimbursement rates. Dr. Woods would have a choice: he could sit on the sidelines and watch the committee hash out the details, or, with his health and well-being in mind, he could put on his hiking boots and climb one of the Presidentials. I recommend the latter, even if the peak is momentarily obscured by the fog.

Thanks to Work Comp Central for the heads up on this issue (subscription required).

Jon Coppelman is a principal with Lynch Ryan & Associates, a Massachusetts-based employer consulting firm. This column was reprinted with is permission from the firm's blog, http://www.workerscompinsder.com