42 A.3d 1151
Pa. Commw. Ct.2012Background
- Legion Insurance denied payment for VAX-D treatments billed by Dr. Ferrara using a temporary non-Medicare code (S9090) not in the Fee Schedule.
- Dr. Ferrara submitted a February 10, 2009 invoice for nine VAX-D treatments totaling $7,374.50 with supporting documentation.
- The insurer issued an Explanation of Review denying payment because S9090 was not in the Fee Schedule.
- The Bureau of Workers' Compensation denied Ferrara's appeal in 2009, prompting de novo review before the Hearing Office.
- The Hearing Office later held that use of an unrecognized code was not fatal and ordered payment of $4,320 plus 10% interest; insurer appealed to Commonwealth Court.
- Pennsylvania regulations permit 80% payment when no Medicare code exists or downcoding to an approved Fee Schedule code; insurer failed to either downcode or pay 80%.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a provider’s use of a temporary non-Medicare code invalidates the invoice. | Ferrara used S9090; no Medicare code exists for VAX-D. | Insurer could deny payment because code not in Fee Schedule. | Use of non-Fee Schedule code not fatal; payment can be 80% or downcoded. |
| Whether the insurer can deny payment when no Medicare code exists for the treatment. | Payment should follow 80% rule or downcoding. | Nonnormal code prevents payment. | Insurer must pay 80% of usual/ customary charge or downcode, not deny outright. |
| Whether the insurer could downcode to an approved Fee Schedule code. | Downcoding allowed; evidence supports VAX-D as coded. | Downcoding was not attempted; failure to downcode improper. | Insurer could have downcoded but did not; court affirmed mandatory payment path. |
| Whether there is authority to deny payment for unrecognized codes under the Act/regulations. | Regulations allow 80% or downcoding when no Medicare code exists. | No authority to pay with unrecognized code. | Regulations authorize 80% or downcoding; denial was improper. |
Key Cases Cited
- Jaeger v. Bureau of Workers' Compensation Fee Review Hearing Office (American Casualty of Reading c/o CNA), 24 A.3d 1097 (Pa.Cmwlth. 2011) (downcoding and payment options when no Medicare code exists)