PMA Mgmt. Corp. v. Bureau of WC Fee Review Hearing Office (Harburg Medical Sales, Co., Inc.)

IN THE COMMONWEALTH COURT OF PENNSYLVANIA
PMA Management Corporation, :
Petitioner :
:
v. : No. 1757 C.D. 2017
: Submitted: December 12, 2018
Bureau of Workers’ Compensation Fee :
Review Hearing Office (Harburg :
Medical Sales, Co., Inc.), :
Respondent :
BEFORE: HONORABLE MARY HANNAH LEAVITT, President Judge
HONORABLE RENÉE COHN JUBELIRER, Judge
HONORABLE ROBERT SIMPSON, Judge
HONORABLE PATRICIA A. McCULLOUGH, Judge
HONORABLE ANNE E. COVEY, Judge
HONORABLE MICHAEL H. WOJCIK, Judge
HONORABLE ELLEN CEISLER, Judge
OPINION NOT REPORTED
MEMORANDUM OPINION
BY PRESIDENT JUDGE LEAVITT FILED: April 12, 2019
PMA Management Corporation (PMA)1 petitions for review of an
adjudication of the Bureau of Workers’ Compensation (Bureau), Fee Review
Hearing Office (Hearing Office) granting in part, and denying in part, the appeals of
five fee determinations of the Bureau’s Medical Fee Review Section made with
respect to the fee review applications of Harburg Medical Sales Company, Inc.
(Medical Goods Supplier). PMA argues that the Hearing Office erred in addressing
the merits of the fee determinations of the Medical Fee Review Section because
Medical Goods Supplier is not a “provider” under the Pennsylvania Workers’
1
PMA is the third party administrator for the School District of Philadelphia, a self-insured
employer.
Compensation Act (Act).2 Concluding this matter is controlled by our recent
decision in Armour Pharmacy v. Bureau of Workers’ Compensation Fee Review
Hearing Office (Wegman’s Food Markets, Inc.), __ A.3d __, (Pa. Cmwlth., No. 1725
C.D. 2017, filed March 29, 2019) (en banc) (Armour I), we vacate and remand.
Dr. Michael McCoy prescribed Roy Mills (Claimant) disposable heat
wraps, replacement pads for an electrical muscle stimulator device, Vitamin E lotion,
adhesive remover and batteries to treat Claimant’s work-related neck and back
injuries.3 Medical Goods Supplier dispensed these items to Claimant and billed
PMA, which denied payment on some of the items. PMA asserted that the
documentation was insufficient and exceeded the usual and customary price. In
response, Medical Goods Supplier filed five applications with the Medical Fee
Review Section, requesting a review of PMA’s refusal to pay its invoices. After the
Medical Fee Review Section upheld PMA’s decisions, Medical Goods Supplier
requested a hearing.
The Hearing Office assigned the matters to a hearing officer, who held
several hearings in 2015 and 2016. The hearings addressed: (1) whether PMA was
required to reimburse Medical Goods Supplier for disposable heat wraps; (2)
whether PMA was required to reimburse Medical Goods Supplier for replacement
pads, Vitamin E lotion, adhesive remover and batteries, which are used with an
electrical muscle stimulator device; and (3) whether Medical Goods Supplier had
overcharged for these items by “unbundling.”4
2
Act of June 2, 1915, P.L. 736, as amended, 77 P.S. §§1-1041.4, 2501-2710.
3
Section 306(f.1)(1)(i) of the Act requires an employer to pay for “reasonable surgical and medical
services, services rendered by physicians or other health care providers ... medicines and supplies,
as and when needed.” 77 P.S. §531(1)(i) (emphasis added).
4
Section 306(f.1)(3)(viii) states:
2
On January 30, 2017, PMA filed a motion to dismiss the hearing
requests. Section 109 of the Act defines a “[h]ealth care provider” as follows:
[A]ny person, corporation, facility or institution licensed or
otherwise authorized by the Commonwealth to provide health
care services, including, but not limited to, any physician,
coordinated care organization, hospital, health care facility,
dentist, nurse, optometrist, podiatrist, physical therapist,
psychologist, chiropractor or pharmacist and an officer, employe
or agent of such person acting in the course and scope of
employment or agency related to health care services.
77 P.S. §29. PMA asserted that Medical Goods Supplier did not meet the definition
of a health care provider. Medical Goods Supplier responded that it has a “National
Provider Identifier” Number and “[y]ou cannot get a national [p]rovider number …
unless you are a Health Provider.” Answer to Motion to Dismiss at 3, ¶16;
Reproduced Record at 273a (R.R. ___).
On October 26, 2017, the Hearing Office issued an adjudication. It
acknowledged that it lacked jurisdiction to address the issue of whether Medical
Goods Supplier was a “provider.” However, it declined to dismiss the case, stating
as follows:
No legally cognizable argument has been advanced with regard
to why a medical supply enterprise, the applications of which
were accepted by the first level Fee Review Office, and whose
participation in the proceedings before the Bureau, and even in
Commonwealth Court goes back a decade, cannot prosecute
these Requests. (As to prior litigation, see, e.g., Harburg
A provider shall not fragment or unbundle charges imposed for specific care except
as consistent with Medicare. Changes to a provider’s codes by an insurer shall be
made only as consistent with Medicare and when the insurer has sufficient
information to make the changes and following consultation with the provider.
77 PS. §531(3)(viii).
3
Medical Sales Co. v. Bureau of Workers’ Compensation (PMA
Ins. Co.), 784 A.2d 866 (Pa. C[mwlth.] 2001)).
Hearing Office Adjudication at 19, Conclusion of Law ¶2; R.R. 294a. On the merits,
the Hearing Office concluded that some of the medical items had been impermissibly
unbundled but that PMA did not provide valid reasons for denying reimbursement.
Accordingly, the Hearing Office granted in part and denied in part the relief
requested by Medical Goods Supplier.
PMA petitioned for the Court’s review.5 PMA argues that it raised a
meritorious challenge to Medical Goods Supplier’s status as a “provider.” The
Hearing Office improperly reached the merits of the case.
Recently, in Armour I we held that where an employer (or its insurer)
challenges a fee determination of the Bureau’s Medical Fee Review Section for the
stated reason that the medical service was not rendered by a “provider” as defined
by the Act, this threshold question must be decided by the Hearing Office.
Accordingly, consistent with Armour I, we vacate the Hearing Office’s
adjudication and remand the matter for a determination of whether Medical Goods
Supplier is a provider within the meaning of Section 109 of the Act, 77 P.S. §29.
_____________________________________
MARY HANNAH LEAVITT, President Judge
5
Our review in medical fee review cases determines whether constitutional rights were violated,
whether an error of law was committed, or whether the necessary findings of fact were supported
by substantial evidence. Pittsburgh Mercy Health System v. Bureau of Workers’ Compensation,
Fee Review Hearing Office (U.S. Steel Corp.), 980 A.2d 181, 184 n.4 (Pa. Cmwlth. 2009).
Regarding questions of law, our scope of review is plenary and our standard of review is de novo.
Sedgwick Claims Management Services, Inc., v. Bureau of Workers’ Compensation, Fee Review
Hearing Office (Piszel and Bucks County Pain Center), 185 A.3d 429, 433 n.2 (Pa. Cmwlth. 2018).
4
IN THE COMMONWEALTH COURT OF PENNSYLVANIA
PMA Management Corporation, :
Petitioner :
:
v. : No. 1757 C.D. 2017
:
Bureau of Workers’ Compensation Fee :
Review Hearing Office (Harburg :
Medical Sales, Co., Inc.), :
Respondent :
ORDER
AND NOW, this 12th day of April, 2019, the order of the Bureau of
Workers’ Compensation Fee Review Hearing Office, dated October 26, 2017, is
hereby VACATED and this matter is REMANDED in accordance with the attached
opinion.
Jurisdiction relinquished.
_____________________________________
MARY HANNAH LEAVITT, President Judge