Medical Fee Schedule

Establishes a medical fee schedule advisory council to advise the
director of health on adjusting the medical fee schedule.  (SD1)

THE SENATE                              S.B. NO.           S.D. 1
TWENTIETH LEGISLATURE, 2000                                
STATE OF HAWAII                                            

                   A  BILL  FOR  AN  ACT



 1      SECTION 1.  Chapter 386, Hawaii Revised Statutes, is amended
 2 by adding a new section to be appropriately designated and to
 3 read as follows:
 4      "386-     Medical fee schedule advisory council.  (a)
 5 There is established within the department of labor and
 6 industrial relations the medical fee schedule advisory council,
 7 or "council", for the purpose of assisting and advising the
 8 director in adjusting the medical fee schedule as provided in
 9 section 386-21, and other matters concerning the medical fee
10 schedule and medical services.
11      (b)  The council shall be composed of thirteen voting
12 members, and no more than ten nonvoting members, as follows:
13      (1)  Four shall be voting members appointed by the governor
14           pursuant to section 26-34 representing health care
15           providers of authorized medical services, including
16           physicians, chiropractors, or physical therapists;
17      (2)  Four shall be voting members appointed by the governor
18           pursuant to section 26-34 representing the business
19           community, including representation from small

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 1           business;
 2      (3)  Four shall be voting members appointed by the governor
 3           to section 26-34 representing the insurance industry;
 4      (4)  The director of labor and industrial relations or the
 5           director's representative shall be an ex-officio voting
 6           member; and
 7      (5)  Not more than ten nonvoting members appointed by the
 8           governor that represent the general public and each of
 9           the four counties.
10      (c)  The powers and duties of the council shall include:
11      (1)  Reviewing annual modifications to the Medicare Resource
12           Based Relative Value Scale and recommending to the
13           director adjustments that should be made to provide
14           adequate rates and fees that ensure at all times that
15           the standard of services and care intended by this
16           chapter are available to injured employees; and
17      (2)  Advising the director on any other matters relating to
18           the medical fee schedule the council may find
19           appropriate to maintain the standard of services for
20           compensable injuries under this chapter.
21      (d)  Members of the council shall serve without compensation
22 but shall be entitled to reimbursement for necessary expenses,
23 including travel expenses, while attending meetings and while in

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 1 the discharge of duties and responsibilities of the council.  The
 2 terms of each nonex-officio member shall be for four years;
 3 provided that half of the initial appointees from each
 4 represented group shall be for only two years in order to stagger
 5 the terms."
 6      SECTION 2.  Section 386-21, Hawaii Revised Statutes, is
 7 amended by amending subsection (c) to read as follows:
 8      "(c)  The liability of the employer for medical care,
 9 services, and supplies shall be limited to the charges computed
10 as set forth in this section.  The director shall make
11 determinations of the charges and adopt fee schedules based upon
12 those determinations.  Effective January 1, 1997, and for each
13 succeeding calendar year thereafter, the charges shall not exceed
14 one hundred ten per cent of fees prescribed in the Medicare
15 Resource Based Relative Value Scale system applicable to Hawaii
16 as prepared by the United States Department of Health and Human
17 Services, except as provided in this subsection.  The rates or
18 fees provided for in this section shall be adequate to ensure at
19 all times the standard of services and care intended by this
20 chapter to injured employees.
21      If the director determines that an allowance under the
22 medicare program is not reasonable, or if a medical treatment,
23 accommodation, product, or service existing as of [June 29,

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 1 1995,] June 30, 1999, is not covered under the medicare program,
 2 the director [may], on the recommendation of the medical fee
 3 schedule advisory council or at any time, may establish an
 4 additional fee schedule or schedules not exceeding the prevalent
 5 charge for fees for services actually received by providers of
 6 health care services to cover charges for that treatment,
 7 accommodation, product, or service.  If no prevalent charge for a
 8 fee for service has been established for a given service or
 9 procedure, the director shall adopt a reasonable rate that shall
10 be the same for all providers of health care services to be paid
11 for that service or procedure.
12      The director shall, with the advice of the council, update
13 the schedules required by this section [every three years or]
14 annually, or more frequently, as required.  The updates shall be
15 based upon:
16      (1)  Future charges or additions prescribed in the Medicare
17           Resource Based Relative Value Scale system applicable
18           to Hawaii as prepared by the United States Department
19           of Health and Human Services; or
20      (2)  A statistically valid survey by the director of
21           prevalent charges for fees for services actually
22           received by providers of health care services or based
23           upon the information provided to the director by the

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                                     S.B. NO.           S.D. 1

 1           appropriate state agency having access to prevalent
 2           charges for medical fee information.
 3      When a dispute exists between an insurer or self-insured
 4 employer and a medical service provider regarding the amount of a
 5 fee for medical services, the director may resolve the dispute in
 6 a summary manner as the director may prescribe; provided that a
 7 provider shall not charge more than the provider's private
 8 patient charge for the service rendered."
 9      SECTION 3.  Statutory material to be repealed is bracketed.
10 New statutory material is underscored.
11      SECTION 4.  This Act shall take effect on July 1, 2000.