DAR File No. 44178

Insurance, Administration

Rule R590-267

Personal Injury Protection Relative Value Study

Notice of Proposed Rule

(Amendment)

DAR File No.: 44178
Filed: 11/01/2019 11:27:19 AM

RULE ANALYSIS

Purpose of the rule or reason for the change:

This change updates the conversion factors and publications for use in 2020 and 2021 with respect to personal injury protection services.

Summary of the rule or change:

This change adds conversion factors and publications for physicians, dentists, and chiropractors to use when determining the reasonable value of services provided to patients on or after January 1, 2020, and removes the factors and publications that were to be used from 2016 through 2017.

Statutory or constitutional authorization for this rule:

• Subsection 31A-22-307(2)
• Subsection 31A-2-201(3)

This rule or change incorporates by reference the following material:

• Removes Relative Values for Dentists, published by Optum 360, 2015
• Adds Relative Values for Physicians, published by Optum 360, 2019
• Adds Relative Values for Dentists, published by Optum 360, 2019
• Removes Relative Values for Physicians, published by Optum 360, 2015

Anticipated cost or savings to:

the state budget:

The Department of Insurance (Department) will be required to purchase two hard copies of the Relative Values for Dentists (RVD) 2019 at $260 each and two copies of the Relative Values for Physicians (RVP) 2019 at $330 each. These publications are incorporated by reference. One copy will be maintained by the Department and one copy will be maintained by the Office of Administrative Rules per rulemaking requirements.

local governments:

There will be no cost or savings to local governments. This rule covers the method by which providers determine the reasonable value of services they provide to consumers.

small businesses:

Medical, dental, and chiropractic offices that provide services for individuals insured in auto accidents may purchase individually, or as a group, the RVD 2019 or RVP 2019 publication that is incorporated by reference in this rule. The cost of the RVD 2019 is $260 for a hard copy. The cost of the RVP 2019 is $330 for a hard copy. By using the publication with the conversion factors in this rule, they will be able to determine the reasonable charges for services they provide to those injured in automobile accidents. The Department is in the process of securing with the publisher a 50% discount for purchasers in Utah. While the Department is quite confident that it will continue as it has for the past six years, the discount has not been finalized yet.

persons other than small businesses, businesses, or local governmental entities:

Auto insurers (or those they contract with to service their claims) and health care providers may purchase the RVD 2019 or RVP 2019 publication that is incorporated by reference in this rule. The cost of the RVD 2019 is $260 for a hard copy. The cost of the RVP 2019 is $330 for a hard copy. By using the publication with the conversion factors in this rule, they will be able to determine the reasonable charges of medical and dental services they are required to reimburse providers for treatment under personal injury protection coverage in Utah. The Department is in the process of securing with the publisher a 50% discount for purchasers in Utah. While the Department is quite confident that it will continue as it has for the past six years, the discount has not been finalized yet. Optum, the company that publishes the RVP 2019 and RVD 2019, will benefit from increased sales of these products.

Compliance costs for affected persons:

Affected persons may purchase the RVD 2019 or RVP 2019 publication that is incorporated by reference in this rule. The cost of the RVD 2019 is $260 for a hard copy, while the RVP 2019 is $330 for a hard copy. The Department is sensitive to this compliance cost and it expects to arrange a 50% discount for purchasers with a Utah address, as has been arranged in prior years, to help ameliorate any adverse costs on small businesses. Additionally, as required by rulemaking guidelines, both publications will be available for review by affected persons at the Department and the Office of Administrative Rules at no charge.

Comments by the department head on the fiscal impact the rule may have on businesses:

I. WHETHER A FISCAL IMPACT TO BUSINESS IS EXPECTED AS A RESULT OF THE PROPOSED RULE AND, IF SO, A DESCRIPTION OF WHY: A number of businesses will have a fiscal impact as a result of this rule. Small businesses (including medical, dental, and chiropractic offices) and larger businesses (such as auto and health insurers) may choose to purchase the RVD 2019 or RVP 2019 publication that is incorporated by reference in this rule. The cost of the RVD 2019 is $260 for a hard copy. The cost of the RVP 2019 is $330 for a hard copy. The Department is sensitive to this compliance cost and it expects to arrange a 50% discount for purchasers with a Utah address, as has been arranged in prior years, to help ameliorate any adverse costs on small businesses. Additionally, as required by rulemaking guidelines, both publications will be available for review by affected persons at the Department and the Office of Administrative Rules at no charge. II. AN ESTIMATE OF THE TOTAL NUMBER OF BUSINESS ESTABLISHMENTS IN UTAH EXPECTED TO BE IMPACTED: Approximately 4,183 businesses in Utah may be impacted by this rule. This includes physician, dental, and chiropractic offices, as well as medical and auto insurers. III. AN ESTIMATE OF THE SMALL BUSINESS ESTABLISHMENTS IN UTAH EXPECTED TO BE IMPACTED: Approximately 4,076 small businesses in Utah may be impacted by this rule. This includes physician, dental, and chiropractic offices which generally have fewer than 50 employees. The Department is sensitive to this compliance cost and it expects to arrange a 50% discount for purchasers with a Utah address, as has been arranged in prior years, to help ameliorate any adverse costs on small businesses. IV. A DESCRIPTION OF THE SOURCES OF COST OR SAVINGS AS WELL AS THE EXPECTED NET SAVINGS OR COST TO BUSINESS ESTABLISHMENTS AND SMALL BUSINESS ESTABLISHMENTS AS A RESULT OF THE PROPOSED RULE OVER A ONE-YEAR PERIOD, IDENTIFYING ONE-TIME AND ONGOING COSTS: Affected persons may purchase the RVD 2019 or RVP 2019 publication that is incorporated by reference in the rule. The cost of the RVD 2019 is $260 for a hard copy, while the RVP 2019 is $330 for a hard copy. Small businesses (physicians, dentists, chiropractors) are likely to purchase one publication or the other, depending on their specialization. The net one-time cost for small businesses as a whole may be $1,252,480. Larger businesses (insurers) may purchase both publications as well. The net one-time cost for larger businesses as a whole may be $63,130. The net one-time cost for all affected persons (small businesses and large businesses) may be $1,316,790. However, the Department expects to arrange a 50% discount for purchasers with a Utah address, as has been arranged in prior years. It is also important to note that the Department makes its copies of the RVD and RVP available to any affected parties for free viewing in the Department's offices. V. DEPARTMENT HEAD'S COMMENTS ON THE ANALYSIS: The above analysis represents the Department's best estimate of the fiscal impact that this rule may have on businesses. Because the analysis did not include the expected 50% discount, the actual impact is expected to be much lower. Affected persons are also welcome to review both publications at the Department's offices at no cost.

Todd E. Kiser, Commissioner

The full text of this rule may be inspected, during regular business hours, at the Office of Administrative Rules, or at:

Insurance
Administration
Room 3110 STATE OFFICE BLDG
450 N MAIN ST
SALT LAKE CITY, UT 84114-1201

Direct questions regarding this rule to:

• Steve Gooch at the above address, by phone at 801-538-3803, by FAX at 801-538-3829, or by Internet E-mail at sgooch@utah.gov

Interested persons may present their views on this rule by submitting written comments to the address above no later than 5:00 p.m. on:

12/16/2019

This rule may become effective on:

12/23/2019

Authorized by:

Steve Gooch, Information Specialist

Appendix 1: Regulatory Impact Summary Table*

Fiscal Costs	FY 2020	FY 2021	FY 2022
State Government	$1,180	$1,180	$1,180
Local Government	$0	$0	$0
Small Businesses	$1,252,480	$1,290,050	$1,328,750
Non-Small Businesses	$63,130	$65,020	$66,970
Other Person	$0	$0	$0
Total Fiscal Costs:	$1,316,79 0	$1,356,250	$1,396,90 0
Fiscal Benefits
State Government	$0	$0	$0
Local Government	$0	$0	$0
Small Businesses	$0	$0	$0
Non-Small Businesses	$0	$0	$0
Other Persons	$0	$0	$0
Total Fiscal Benefits:	$1,316,790	$1,356,250	$1,396,900
Net Fiscal Benefits:	$0	$0	$0

 

*This table only includes fiscal impacts that could be measured. If there are inestimable fiscal impacts, they will not be included in this table. Inestimable impacts for State Government, Local Government, Small Businesses and Other Persons are described in the narrative. Inestimable impacts for Non - Small Businesses are described in Appendix 2.

 

Appendix 2: Regulatory Impact to Non - Small Businesses

There are 107 auto insurers and health insurers in Utah that may be affected by this rule, according to Insurance Department licensing records. Each of these businesses may purchase both the Relative Values for Physicians and Relative Values for Dentists publications, which cost $330 and $260,respectively. This may result in a total cost to non-small businesses of $63,130.

 

The head of the Insurance Department, Todd E. Kiser, has reviewed and approved this fiscal analysis.

 

 

R590. Insurance, Administration.

R590-267. Personal Injury Protection Relative Value Study Rule.

R590-267-1. Authority.

This rule is promulgated by the insurance commissioner pursuant to Subsections 31A-2-201(3) and 31A-22-307(2).

 

R590-267-2. Purpose.

(1) The purpose of this rule is to establish a reasonable value of services and accommodations for the diagnosis, care, recovery, or rehabilitation of an injured person under automobile personal injury protection coverage as described in Subsection 31A-22-307(1)(a).

(2) As required by Subsection 31A-22-307(2), the reasonable value is based on the 75th percentile of medical, dental, and chiropractic charges, as they presently exist in the most populous county in this State.

 

R590-267-3. Scope.

This rule applies to services and accommodations provided:

(1) under automobile personal injury protection coverage as described in Subsection 31A-22-307(1)(a); and

(2) on or after January 1, 2014.

 

R590-267-4. Definitions.

(1) As used in this rule "Conversion Factor" means a multiplier used to convert the relative value unit or units of a service or a procedure to a reimbursement rate.

(2) As used in this rule "RVD [2017]2019" means [2017]2019 Edition of the Relative Values for Dentists published by Optum360, 2525 Lake Park Blvd., Salt Lake City, UT 84120; phone: (800) 464-3649; [email: customerassistance@optum.com; ]website: www.optum360coding.com.

(3) As used in this rule "RVD [2015]2017" means [2015]2017 Edition of the Relative Values for Dentists published by Optum360, 2525 Lake Park Blvd., Salt Lake City, UT 84120; phone: (800) 464-3649; [email: customerassistance@optum.com; ]website: www.optum360coding.com.

(4) As used in this rule "RVP [2017]2019" means [2017]2019 Edition of the Relative Values for Physicians published by Optum360, 2525 Lake Park Blvd., Salt Lake City, UT 84120; phone: (800) 464-3649; [email: customerassistance@optum.com; ]website: www.optum360coding.com.

(5) As used in this rule "RVP [2015]2017" means [2015]2017 Edition of the Relative Values for Physicians published by Optum 360, 2525 Lake Park Blvd., Salt Lake City, UT 84120; phone: (800) 464-3649; [email: customerassistance@optum.com; ]website: www.optum 360coding.com.

(6) As used in this rule "Relative Value Unit" means a numerical value assigned to a medical or dental procedure as published in RVP and RVD respectively.

(7) The publications identified in Subsections R590-267-4(2), (3), (4), and (5) are hereby incorporated by reference within this rule.

 

R590-267-5. Conversion Factors.

(1)(a) The following conversion factors shall be used with RVP [2017]2019 to determine the reasonable value of medical services or accommodations provided on or after January 1, [2018]2020:

(i) anesthesia, [99.27]108.00;

(ii) surgery, [225.90]225.88;

(iii) radiology, [37.50]35.60;

(iv) pathology, [25.00]24.29;

(v) medicine, [13.00]12.80;

(vi) evaluation and management, [14.65]14.74.

(b) The conversion factor used with RVD [2017]2019 to determine the reasonable value of dental services or accommodations provided on or after January 1, [2018]2020 shall be [63.00]66.67.

(2)(a) The following conversion factors shall be used with RVP [2015]2017 to determine the reasonable value of medical services or accommodations provided from January 1, [2016]2018 through December 31, [2017]2019:

(i) anesthesia, [97.13]99.27;

(ii) surgery, [200.00]225.90;

(iii) radiology, [35.84]37.50;

(iv) pathology, [24.29]25.00;

(v) medicine, [11.67]13.00;

(vi) evaluation and management, [13.16]14.65.

(b) The conversion factor used with RVD [2015]2017 to determine the reasonable value of dental services or accommodations provided from January 1, [2016]2018 through December 31, [2017]2019 shall be [60.00]63.00.

 

R590-267-6. Fee Schedule.

The reasonable value of any service or accommodation shall be calculated by multiplying the relative value unit assigned to the service or accommodation by the applicable conversion factor prescribed in R590-267-5.

 

R590-267-7. Penalties.

A person found to be in violation of this rule shall be subject to penalties as provided under Section 31A-2-308.

 

R590-267-8. Severability.

If any provision of this rule or its application to any person or situation is held to be invalid, that invalidity shall not affect any other provision or application of this rule which can be given effect without the invalid provision or application, and to this end the provisions of this rule are declared to be severable.

 

KEY: relative value study

Date of Enactment or Last Substantive Amendment: [January 1, 2018]2019

Notice of Continuation: October 24, 2018

Authorizing, and Implemented or Interpreted Law: 31A-2-201(3); 31A-22-307(2)