The New York State Department of Financial Services (“DFS’) has finalized the Thirty-Third Amendment to Regulation 83 (the “33rd Amendment”), which was published in the State Register on October 25, 2017 and will affect treatment rendered on or after January 23, 2018. Pursuant to the accompanying press release, the 33rd Amendment is designed to “limit the amount that insurers can reimburse for healthcare services performed outside of New York State under its no-fault insurance law.” By limiting reimbursement amounts for out-of-state no-fault healthcare services, which are treating New York State (“NYS”) residents, the DFS intends to “curb costs and abuses” by out-of-state medical providers charging excessive rates.
The 33rd Amendment separates treatment by out-of-state medical providers into the following two categories:
- Out-of-state medical services, which (a) constitute emergency care, (b) are provided to non-NYS residents, and (c) are provided to patients with a NYS domicile, who are currently living in the state where the treatment is being rendered, for reasons unrelated to the accident.
- Out-of-state medical services provided to a NYS resident, currently living in NYS.
There is one main difference between the two categories—which state’s no-fault fee schedule governs and must be utilized by the insurer when reimbursing the medical provider. Simply put, if the medical services fall into Category 1, the medical provider’s reimbursement will be capped at the No-Fault Schedule rate for the state and region wherein the services are provided. By contrast, if the medical services fall into Category 2, the medical provider’s reimbursement will be capped at the highest rate available under the New York State No-Fault Fee Schedule. While the foregoing may be the general rule, there are nuances requiring attention.
The reimbursement rate for medical services is now capped at the prevailing fee in the geographical location of the provider, unless the provider charges less. While this may not appear to be a change, the 33rd Amendment now limits the prevailing geographical rate to that area’s local No-Fault Fee Schedule Rate. In other words, if the services are performed in Northern New Jersey (“NJ”), the provider’s reimbursement is limited to the NJ No-Fault Fee Schedule rate for NJ-North.
Example 1: If an Ambulatory Surgery Center (“ASC”), which renders services in Hackensack, New Jersey (“NJ”), treats a patient, who lives in NJ but is covered by a NY policy, then that medical provider’s charges would be limited to the NJ No-Fault ASC Fee Schedule Rate for Region North.
Example 2: Two weeks post-accident, a full-time Rutgers University student, who lives on campus, presents for treatment at an MRI facility located in New Brunswick, NJ, as a result of injuries she sustained while driving her car. Despite living on-campus in NJ, the student still maintains her NYS driver’s license and a NY automobile policy because she plans to return home to Queens, New York after graduation. In this instance, the provider’s charges would be capped at the NJ No-Fault ASC Fee Schedule Rate for Region North even though the patient’s domicile is New York.
The reimbursement rate for medical services rendered out-of-state to a patient living in NYS, is capped at the lowest of the following: (a) the NYS No-Fault Fee Schedule amount for the region with the highest reimbursable rate; (b) the fee charged by the medical provider, or (c) the prevailing fee in the geographic location of the out-of-state medical provider, a.k.a. that state’s No-Fault Fee Schedule rate. As the NYS No-Fault Fee Schedule rate is generally lesser than the No-Fault Fee Schedule rate of other states, in almost all instances, an out-of-state medical provider, which is treating a NYS resident will be capped at the NYS No-Fault fee schedule rate for New York City (“NYC”), which is the highest rate in NYS.
Example 1: An Ambulatory Surgery Center (“ASC”), which renders services in Hackensack, NJ, treats a patient, who lives in Warwick, NY and is covered by a NYS insurance policy. In this instance, the NJ medical provider’s charges would be limited to the highest NYS No-Fault Fee Schedule Rate for that service, i.e. the NYC rate.
Example 2: 3 days post-accident, an 89-year-old woman, who lives in Staten Island, NY, but is visiting her children in Short Hills, NJ presents to the emergency room (“ER”) of a local NJ hospital, with the following symptoms: confusion, unbalanced gait, nausea and headache. An MRI performed in the emergency room reveals a slow-bleeding subdural hematoma. The patient is admitted in-patient for emergency medical treatment, including surgical decompression. In this instance, the hospital’s charges would be limited to the highest NYS No-Fault Fee Schedule Rate for the services rendered because the treatment was not initiated within 48 hours following the accident. Thus, the treatment is not deemed to be “emergency care” under the 33rd Amendment, despite the fact that the treatment was necessary to stabilize the patient’s condition.
In order to maximize recovery without running afoul of the new fee schedule mandates of the 33rd Amendment, out-of-state medical providers treating patients covered by NYS No-Fault policies must be cognizant of the following when billing for medical services rendered:
- Whether their own state or NYS has the lowest reimbursable rate for the services rendered;
- The number of hours between when the motor vehicle accident occurred and when the medical provider initiated treatment;
- The patient’s current residence and permanent domicile;
- The reason why the patient is currently residing within the state where the treatment is rendered, if the patient is domiciled in NYS.
With these factual components now governing the applicable fee schedule rate to be utilized by out-of-state medical providers billing a NYS No-Fault insurer, out-of-state medical providers must ensure that said information is obtained from the patient during the intake process. Furthermore, out-of-state hospitals and ambulances billing a NYS No-Fault policy may no longer rely solely on the 10th Revision of the International Statistical Classification of Diseases and Related Health Problems (“ICD-10”) when deciding whether the medical services they render are deemed “emergency care”. Rather, the hospitals and ambulances must look past the nature of the treatment rendered and determine whether they initiated said treatment within 48 hours of the accident.