The Florida Senate
BILL ANALYSIS AND FISCAL IMPACT STATEMENT
(This document is based on the provisions contained in the legislation as of the latest date listed below.)
Prepared By: The Professional Staff of the Committee on Banking and Insurance
BILL: SB 362
INTRODUCER: Senator Bradley
SUBJECT: Medical Treatment Under the Workers’ Compensation Law
DATE: January 8, 2024
ANALYST STAFF DIRECTOR REFERENCE ACTION
1. Johnson Knudson BI Favorable
2. HP
3. FP
I. Summary:
SB 362 increases the maximum medical reimbursements for physicians and surgical procedures
and the maximum fees for expert witnesses under ch. 440, F.S., “Workers Compensation Law”
(law). The law requires employers to provide injured employees all medically necessary
remedial treatment, care, and attendance for such period as the nature of the injury or the process
of recovery may require.
The bill increases the maximum reimbursement allowances (MRA) for physicians and surgical
procedures to 200 percent of Medicare. Currently, the maximum reimbursement allowance for a
physician licensed under ch. 458, F.S., or ch. 459, F.S., is 110 percent of Medicare and the
maximum reimbursement allowance for surgical procedures is 140 percent of Medicare.
In regards to expert medical witnesses, the law currently limits the amount health care providers
can be paid for expert testimony during depositions on a workers’ compensation claim to $200
per hour, unless they only provided an expert medical opinion following a medical record review
or provided direct personal services unrelated to the case in dispute, then they are limited to a
maximum of $200, per day. The bill increases the maximum hourly amount allowed expert
witnesses to $300, per hour. For those expert witnesses subject to the daily rate, the maximum
amount allowed is increased to $300, per day.
Implementation of the bill is estimated to result in a 7.3 percent increase (or $286 million) in
overall workers’ compensation system costs. The estimated impact on state and local
governments is indeterminate.
REVISED: BILL: SB 362 Page 2
II. Present Situation:
Florida Workers’ Compensation System
Florida’s Workers’ Compensation Law
1
requires employers to provide injured employees all
medically necessary remedial treatment, care, and attendance for such period as the nature of the
injury or the process of recovery may require.
2
The Division of Workers’ Compensation within
the Department of Financial Services (DFS), provides regulatory oversight of the workers’
compensation system in Florida, including the health care delivery system.
Reimbursement for Health Care Providers
Health care providers must receive authorization from the insurer before providing treatment,
and submit treatment reports to the insurer.
3
Insurers must reimburse an individual physician,
hospital, ambulatory surgical center, pain program, or work-hardening program at either the
agreed-upon contract price or the maximum reimbursement allowance in the appropriate
schedule.
4
DFS mediates utilization and reimbursement disputes.
5
A three-member panel (panel) consisting of the Chief Financial Officer (CFO) or his or her
designee and two Governor’s appointees sets the MRAs.
6
The DFS incorporates the statewide
schedules of the MRAs by rule in reimbursement manuals. In establishing the MRA manuals, the
panel considers the usual and customary levels of reimbursement for treatment, services, and
care; the cost impact to employers for providing reimbursement that ensures that injured workers
have access to necessary medical care; and the financial impact of the MRAs on healthcare
providers and facilities.
7
Florida law requires the panel to develop MRA manuals that are
reasonable, promote the workers’ compensation system’s health care cost containment and
efficiency, and are sufficient to ensure that medically necessary treatment is available for injured
workers.
8
The panel develops four different reimbursement manuals to determine statewide schedules of
maximum reimbursement allowances. The health care provider manual limits the maximum
reimbursement for licensed physicians to 110 percent of Medicare reimbursement,
9
while
reimbursement for surgical procedures is limited to 140 percent of Medicare.
10
The hospital
manual sets maximum reimbursement for outpatient scheduled surgeries at 60 percent of
charges,
11
while other outpatient services are limited to 75 percent of usual and customary
charges.
12
Reimbursement of inpatient hospital care is limited based on a schedule of per diem
1
Ch. 440, F.S.
2
Section 440.13(2)(a), F.S.
3
Section 440.13, F.S.
4
Section 440.13(12)(a), F.S.
5
Section 440.13, F.S.
6
Id.
7
Section 440.13(12)(i), F.S.
8
Id.
9
Section 440.13(12)(f), F.S.
10
Section 440.13(12)(g), F.S.
11
Section 440.13(12)(d), F.S.
12
Section 440.13(12)(a), F.S. BILL: SB 362 Page 3
rates approved by the panel.
13
The ambulatory surgical centers manual limits reimbursement to
60 percent of usual and customary as such services are generally scheduled outpatient surgeries.
The prescription drug reimbursement manual limits reimbursement to the average wholesale
price plus a $4.18 dispensing fee.
14
Repackaged or relabeled prescription medication dispensed
by a dispensing practitioner has a maximum reimbursement of 112.5 percent of the average
wholesale price plus an $8.00 dispensing fee.
15
Fees may not exceed the schedules adopted under
Ch. 440, F.S., and DFS rule.
16
DFS incorporates the MRAs approved by the Three-Member
Panel in reimbursement manuals
17
through the rulemaking process provided by the
Administrative Procedures Act.
18
Expert Witness Fees for Health Care Providers
Chapter 440.13, F.S., limits the amount a health care provider can be paid for expert testimony
during depositions on a workers’ compensation claim. As an expert medical witness, a workers’
compensation health care provider is limited to a maximum $200 per hour. An expert witness
who only provided an expert medical opinion following a medical record review or provided
direct personal services unrelated to the case in dispute is limited to a maximum witness fee of
$200 per day.
19
III. Effect of Proposed Changes:
Section 1 amends s. 440.13, F.S. Subsection (10) is amended to increase the maximum amount a
health care provider can be paid for expert testimony during a deposition on a workers’
compensation claim from $200 to $300 per hour. A health care provider that only provides an
expert medical opinion following a medical record review or provides direct personal services
unrelated to the case in dispute, is limited to a maximum witness fee of $300 rather than $200
per day.
Subsection (12) is amended to increase the maximum reimbursement for a physician licensed
under ch. 458, F.S., or ch. 459, F.S., from 110 percent to 200 percent of Medicare, using
appropriate codes and modifiers or the medical reimbursement level adopted by the three-
member panel as of January 1, 2003, whichever is greater. The maximum reimbursement for
surgical procedures is increased from 140 percent to 200 percent of the reimbursement allowed
by Medicare, using appropriate codes and modifiers or the medical reimbursement level adopted
by the three-member panel as of January 1, 2003, whichever is greater.
Section 2 provides that act takes effect July 1, 2024.
13
Id.
14
Section 440.13(12)(h), F.S.
15
Id.
16
Section 440.13(13)(b), F.S. DFS also has rulemaking authority under s. 440.591, F.S.
17
Sections 440.13(12) and 440.13(13), F.S., and Ch. 69L-7, F.A.C.
18
Ch. 120, F.S.
19
S. 440.13(10), F.S. BILL: SB 362 Page 4
IV. Constitutional Issues:
A. Municipality/County Mandates Restrictions:
None.
B. Public Records/Open Meetings Issues:
None.
C. Trust Funds Restrictions:
None.
D. State Tax or Fee Increases:
None.
E. Other Constitutional Issues:
None.
V. Fiscal Impact Statement:
A. Tax/Fee Issues:
None.
B. Private Sector Impact:
The bill increases the maximum payments to medical providers who appear as expert
medical witnesses in litigated workers’ compensation claims.
The bill increases payments to physicians and for surgical procedures (including all
scheduled, non‐emergency clinical laboratory and radiology services; and outpatient
physical, occupational, and speech therapy services). Implementation of the bill would
result in an estimated 7.3 percent increase (or $286 million) in overall workers’
compensation system costs, as described below.
The National Council on Compensation Insurance, Inc., Analysis of SB 1344
20
The National Council on Compensation Insurance, Inc., (NCCI) provided the following
analysis of the impact of changing maximum reimbursement allowances (MRAs) in the
20
NCCI, Analysis of Florida Medical Fee Schedule Changes (2023 Session, HB 1299/SB 1344) (Mar. 28, 2023). On file with
Banking and Insurance Committee. For the 2024 Session, SB 362 was filed, which is identical to SB 1344. An updated
analysis by NCCI to incorporate the 2024 changes in the Medicare fee schedules is expected to be available in late January or
early February.
BILL: SB 362 Page 5
2016 edition of the Health Care Provider Reimbursement Manual (HCPRM). The
Division of Workers’ Compensation of DFS asked NCCI, the licensed rating and
statistical organization for the Florida workers’ compensation system, to analyze an
additional four scenarios.
The current state multiplier for surgical is 140 percent and the current state multiplier for
all others is 110 percent. The state-specific multipliers for HB 1299/SB1344 (scenario 3
increases both multipliers to 200 percent), as well as four additional scenarios are
summarized below:
Type of
Service
Proposed Multiplier by Scenario
1 2 3 4 5
Surgical 150
percent
175
percent
200
percent
225
percent
250
percent
All Other 150
percent
175
percent
200
percent
225
percent
250
percent
NCCI estimates that the changes to the MRAs, proposed to be effective July 1, 2023,
would result in the following estimated impacts on overall Florida workers compensation
system costs under each of the proposed scenarios, where Scenario 3 is the estimated
impact of HB 1299/SB 1344:
Scenario Estimated Percentage Impact Estimated Impact on Overall
Costs
21
1 +3.1 +$122 million
2 +5.2 +$204 million
3 +7.3 +$286 million
4 +9.4 +$369 million
5 +11.5 +$451 million
In addition to physician services, the proposed changes would also impact MRAs for the
following hospital outpatient services contained in the Florida Workers’ Compensation
Reimbursement Manual for Hospitals:
All scheduled, non‐emergency clinical laboratory and radiology services; and
Outpatient physical, occupational, and speech therapy services.
The changes to the HCPRM also impact certain hospital outpatient services. In Florida,
payments for hospital outpatient services represent 18.4 percent of medical costs, and
hospital outpatient services subject to the HCPRM MRAs represent 3.3 percent of total
hospital outpatient costs.
21
Overall system costs are based on 2021 net written premium for insurance companies including an estimate of self-insured
premium as provided by the Florida Division of Workers’ Compensation. For each scenario, the estimated dollar impact is
displayed for illustrative purposes only and calculated as the respective percentage impact multiplied by $3,921 million.
These figures do not include the policyholder retained portion of deductible policies, or adjustments for subsequent changes
in premium levels. The use of premium as the basis for the dollar impact assumes that expenses and other premium
adjustments will be affected proportionally to the change in benefit costs. BILL: SB 362 Page 6
Expert Medical Witness Fees
Currently, the reimbursement for an expert medical witness cannot exceed $200/hour.
HB 1299/SB 1344 seek to increase the maximum reimbursement amount to $300/hour,
an increase of 50 percent (= $300 / $200 – 1). Comprehensive data on expert medical
witness payments by employers/insurers is not readily available to NCCI. While the
magnitude of the increase in workers compensation system costs resulting from the
proposed change in the hourly rate for expert medical witness depositions is uncertain,
NCCI anticipates that any such potential increase would be minimal. Minimal is defined
in this context to be an impact on overall system costs of less than plus 0.2 percent.
C. Government Sector Impact:
See analysis above, in Private Sector Impact. Indeterminate.
VI. Technical Deficiencies:
None.
VII. Related Issues:
None.
VIII. Statutes Affected:
This bill substantially amends section 440.13 of the Florida Statutes.
IX. Additional Information:
A. Committee Substitute – Statement of Changes:
(Summarizing differences between the Committee Substitute and the prior version of the bill.)
None.
B. Amendments:
None.
This Senate Bill Analysis does not reflect the intent or official position of the bill’s introducer or the Florida Senate.