Proposed Action on Procedural Regulation 14.09.01 – Maryland Register Vol. 38, Issue 1, Monday January 3, 2011
Maryland’s proposed regulations requiring CMS approval of all claims meeting the CMS review thresholds were published in the Maryland Register on January 3, 2011. Evidence of the continued underestimation of the impact of the legislation by the Workers’ Compensation Commission is that the notice states that the proposed action has 1) no economic impact, 2) minimal or no economic impact on small businesses and 3) no impact on individuals with disabilities. These assessments are completely untrue as the economic impact in general will be far reaching within the state. CMS approval of MSAs comes at an inherent cost. CMS requires funding of services in excess of normal medical billing practices, in contradiction to the actual practice of medicine, and despite any number of independent medical evaluations that may otherwise counter a recommended medical service CMS wants funded, inclusive of a claimant’s refusal to undergo such service. There is no appeal to these determinations; therefore, by statutorily requiring them, the State of Maryland is forcing mandatory compliance with an unreasonable, subjective, and voluntary federal program administered by an agency under the Department of Health and Human Services.
The economic impact not being considered here is the inevitable increase in workers’ compensation premiums that will result from implementation of this requirement, harming all Maryland employers. An MSA requiring CMS approval is a minimum of 20% greater on average than simply meeting reasonable MSP compliance under the federal statute. The increased cost of claims may cause even more private insurers to choose not to write in our state and further decrease competitive prices here. If the remaining insurers are unable to settle claims and take down reserves, they may grow increasingly limited in their ability to write new business. So higher premiums, higher deductibles will result, but with no change in number of incidents.
As for not harming the disabled parties, the state is taking away their rights under state law to settle a claim if they so chose. The CMS approval requirement increases the cost of settling claims so much that many carriers find they prefer to leave the claim open rather than fund the unreasonable demands of CMS. By converting future benefits into a current payment, some claimants may have the ability to pay off debt and reenter the workforce with the remaining funds available to supplement new income. And the worst part about the new law is that it does not address the real problem. CMS approval only deals with the amount allocated for future medical needs. The new law does not address the issue that even if the CMS approved amount is funded, claimants have free reign over those funds and can potentially squander them at will putting themselves in the position that the WCC is attempting to avoid.
Opportunity for public comment runs through February 2, 2011. Comments may be sent to Amy S. Lackington, Administrator, Workers’ Compensation Commission, 10 East Baltimore Street, Baltimore, MD 21202, or call 410-864-5300, or email to email@example.com, or fax to 410-864-5301.