1. Statutory authority: Sections 201 and 301 of the Insurance Law authorizes the superintendent to prescribe regulations interpreting the Insurance Law, to effectuate any power granted under the Insurance Law, and to prescribe forms or otherwise make regulations.

Section 2601 prohibits insurers from engaging in unfair claim settlement practices and requires insurers to adopt and implement reasonable standards for the prompt investigation of claims arising under insurance policies.

Section 5221 specifies the duties and obligations of the Motor Vehicle Accident Indemnification Corporation (MVAIC) in the payment of no-fault benefits to qualified persons.

Article 51 of the Insurance Law contains the provisions authorizing the establishment of a no-fault reparations system for persons injured in motor vehicle accidents, and Section 5108 specifically authorizes the superintendent to adopt or promulgate fee schedules for health care benefits payable under the no-fault system.

2. Legislative objectives: Chapter 892 of the Laws of 1977 recognized the necessity of establishing schedules of maximum permissible charges for professional health services payable as no-fault insurance benefits in order to contain the costs of no-fault insurance. To that end, the superintendent is required to adopt those fee schedules that are promulgated by the Chairman of the Workers' Compensation Board (WCB). In addition, the superintendent may, after consulting with the Chairman of the Workers' Compensation Board and the Commissioner of Health, establish fee schedules for those services for which schedules have not been prepared and established by the WCB. The WCB currently has a fee schedule for acupuncture services performed by medical doctors certified to perform acupuncture, and for chiropractors licensed to perform acupuncture. The WCB does not have a fee schedule for acupuncture services performed by licensed acupuncturists. Since acupuncture services performed by a licensed acupuncturist in New York are covered services for purposes of no-fault reimbursement, this rule will establish fees for licensed acupuncturists.

3. Needs and benefits: The Workers' Compensation Board fee schedules were initially adopted in 1977 and have been revised regularly since that time in order to reflect inflationary increases and to incorporate other necessary enhancements. Similar modifications and improvements have also been applied to those fee schedules established by the Insurance Department for various health care services related to automobile accidents that are not covered in any fee schedule established by the WCB. Periodic revision to the fee schedules is a part of the ongoing process of keeping the fee schedules current and reflective of changes in the health care industry, thereby facilitating access to health care for motor vehicle accident victims while controlling costs.

The WCB currently has a fee schedule for acupuncture services performed by medical doctors certified to perform acupuncture and another fee schedule for chiropractors licensed to perform acupuncture. The WCB does not have a fee schedule for acupuncture services performed by licensed acupuncturists.

The current regulation does not establish the appropriate level of reimbursement for acupuncture treatment rendered by an acupuncturist, which leads to many fee disputes going to arbitration or court to be adjudicated. In order to reduce the number of these disputes, to assure a sufficient pool of health providers, and provide a uniform method of reimbursement by no-fault insurers, this proposed rule states that the maximum permissible charge for treatment rendered by a licensed acupuncturist shall not exceed the maximum permissible charge for a physician certified to perform acupuncture in accordance with the Workers' Compensation Medical fee schedule contained in 12 NYCRR 329.3.

Pursuant to 11 NYCRR Part 65, Section 65-3.16(a)(6) of Regulation 68 acupuncturists must be licensed in order to be reimbursed for acupuncture treatment rendered to no-fault patients. There is no Department certification requirement for acupuncturists to handle no-fault patients. Acupuncture treatment rendered by licensed acupuncturists is the primary service they perform and for which they bill. The WCB permits an additional fee for the reimbursement of acupuncture treatment rendered by a chiropractor licensed to perform acupuncture as an adjunct service to the primary services that the chiropractor performs and for which the chiropractor bills. The WCB also establishes a fee for reimbursement of acupuncture treatment rendered by a medical doctor certified to perform acupuncture as an adjunct service to the primary services that the doctor performs and for which the doctor bills, which in many instances is greater than the fee permitted to be charged by a chiropractor. Since the acupuncture treatments are the primary service performed and billed by licensed acupuncturists and the acupuncturist is not permitted to bill for any other services, the superintendent has determined that such treatments merit reimbursement at the same rate that medical doctors receive for comparable services.

The establishment by the superintendent of fees for acupuncture treatment rendered by licensed acupuncturists will reduce disputes regarding the fees to be charged, provide for more timely payment of acupuncturist's charges, and result in a significant reduction in litigation costs that are presently being incurred due to the lack of a fee schedule for licensed acupuncturists. Utilization of a maximum permissible fee for licensed acupuncturists should significantly reduce the number of disputes between insurers and licensed acupuncturists, resulting in more uniform, efficient, and cost-effective processing and payment of no-fault claims.

4. Costs: This revised rule imposes no compliance costs upon state or local governments unless they are self-insured for no-fault coverage, in which case they will incur the same cost required by a regular insurer. Insurers, self-insurers and licensed acupuncturists who provide services under the no-fault system should already have the Workers' Compensation Medical fee schedule. If they do not have the fee schedule, they must acquire it, currently at a cost of $65.

The establishment of fees for acupuncture services performed by licensed acupuncturists should result in savings because the rule will reduce the number of disputes between insurers and licensed acupuncturists, resulting in more uniform, efficient and cost-effective processing and payment of no-fault claims. The establishment of the fees also will reduce the number of disputes that go to arbitration and court.

Because there is currently no fee schedule for acupuncture services performed by a licensed acupuncturist, some insurers have reimbursed the licensed acupuncturists in accordance with the fee schedule for chiropractors licensed to perform acupuncture and other insurers have reimbursed the licensed acupuncturists using the fee schedule for acupuncture services performed by medical doctors certified to perform acupuncture. The licensed acupuncturists who were reimbursed by the insurer using the acupuncture fee schedule for chiropractors will see an increase in the reimbursement amount under this revised rule.

5. Local government mandates: Some local governments are self-insured for no-fault coverage, and those entities will have to comply with the requirements of this part. The Insurance Department conducted outreach to the NYC Comptroller's office to ascertain the fiscal impact of using a fee schedule. The Comptroller's office indicated that the savings attributed to efficient and cost-effective processing and payment of claims and reduction in disputes between insurers and licensed acupuncturists will offset any possible increase in reimbursement rates.

6. Paperwork: There are no additional paperwork requirements generated by the amendment to this part. The establishment of the fees will result in reducing the number of disputes that go to arbitration and court and the corresponding paperwork associated with it.

7. Duplication: The provisions of this Part will not duplicate any existing federal or state rule.

8. Alternatives: The current practice for the reimbursement of acupuncture treatment performed by an acupuncturist is to allow the prevailing rate in the geographic location of the acupuncturist subject to review by the insurer for consistency with charges permissible for similar procedures under schedules already adopted or established by the Superintendent. This fails to establish definitive values for the reimbursement of acupuncture treatment rendered by licensed acupuncturists, resulting in frequent fee disputes that proceed to no-fault arbitration or the courts for resolution, where rulings have been inconsistent and fail to provide guidance with regard to proper billing.

In developing this proposal, the Department consulted with an acupuncturist's trade organization and no-fault arbitrators. The acupuncturist's trade association stated that the doctor's rate and the chiropractor's rate for acupuncture services under workers' compensation have been established as adjuncts to the fees that doctors and chiropractors can charge for office visits. The acupuncturist's trade association suggested using an evaluation and management (E and M) fee for each patient seen, because the fee for acupuncture provided by an acupuncturist is not an adjunct to a fee for an office visit. E and M fees consist of different components such as patient history, physical examination and medical decisions of moderate or high complexities. E and M fees also consist of different levels of treatments with different complexities depending on the nature of the injuries sustained. Therefore, E and M fees are billed by physicians based on the specific level at which they are performed, such as comprehensive or detailed examination versus a brief examination. Acupuncturists perform E and M of a completely different nature than that of a physician, such as pulse monitoring and examination of the tongue prior to inserting the needle. Because the E and M performed by physicians is not consistent with the procedures performed by a licensed acupuncturist, the Department concluded that utilization of an E and M fee is not warranted.

There is also an appellate term decision that established an insurer's payment of services using the workers' compensation fee for chiropractors providing acupuncture services as being in compliance with Section 68.5(b) of Regulation 83.

The WCB permits an additional fee for the reimbursement of acupuncture treatment rendered by a chiropractor licensed to perform acupuncture as an adjunct service to the primary services that the chiropractor performs and for which the chiropractor bills. The WCB also establishes a fee for reimbursement of acupuncture treatment rendered by a medical doctor certified to perform acupuncture as an adjunct service to the primary services that the doctor performs and for which the doctor bills. Since the acupuncture treatments are the primary service performed and billed by licensed acupuncturists and the acupuncturist is not permitted to bill for any other services, the superintendent has determined that such treatments merit reimbursement at the same rate that medical doctors receive for comparable services.

9. Federal standards: There are no minimum standards of the federal government for the same or similar subject areas.

10. Compliance: The rule will be effective 90 days after publication of the notice of adoption in the State Register, so as to provide enough lead time for insurers, self-insurers and licensed acupuncturists to obtain copies of the Workers' Compensation Medical fee schedule and implement the rule.

1. Effect of the rule: This rule is primarily directed to property/casualty insurance companies authorized to do business in New York State and self-insurers, none of which fall within the definition of "small business" contained in section 102(8) of the State Administrative Procedure Act, because there are none that are both independently owned and that employ fewer than 100 persons. The Insurance Department has reviewed filed Reports on Examination and Annual Statements of authorized property/casualty insurers and determined that none of them comes within the definition of "small business".

The regulation is applicable to local governments, some of which are self-insured for no-fault benefits. It is also applicable to licensed acupuncturists, most of which are considered small businesses. There may be a few acupuncturists that are incorporated as professional corporations and which may not be considered small businesses.

However, this rule is not expected to have any adverse economic impact on any parties, including local governments and acupuncturists. The establishment of fees for acupuncture services performed by licensed acupuncturists should result in savings because the rule will reduce the number of disputes between insurers and licensed acupuncturists, resulting in more uniform, efficient and cost-effective processing and payment of no-fault claims. The establishment of the fees will also reduce the number of disputes that go to arbitration and court. The Insurance Department conducted outreach to the NYC Comptroller's office to ascertain the fiscal impact of using a fee schedule. The Comptroller's office indicated that the savings attributed to efficient and cost-effective processing and payment of claims and reduction in disputes between insurers and licensed acupuncturists will offset any possible increase in reimbursement rates.

2. Compliance requirements: Insurers, self-insurers and licensed acupuncturists who provide services under the no-fault system should already have the Workers' Compensation Medical fee schedule.

The establishment of the fees will result in reducing the number of disputes that go to arbitration or court and the corresponding paperwork associated with it.

3. Professional services: No professional services are required to comply with the rule.

4. Compliance costs: This revised rule imposes no compliance costs upon state or local governments unless they are self-insured for no-fault insurance in which case they will incur the same cost required by a regular insurer.

Insurers, self-insurers and licensed acupuncturists who provide services under the no-fault system should already have the Workers' Compensation Medical fee schedule. If they do not have the fee schedule, they must acquire it, currently at a cost of $65.

The establishment of fees for acupuncture services performed by licensed acupuncturists should result in savings because the rule will reduce the number of disputes between insurers and licensed acupuncturists, resulting in more uniform, efficient and cost-effective processing and payment of no-fault claims. The establishment of the fees will also reduce the number of disputes that go to arbitration and court.

5. Economic and technological feasibility: Compliance with the rules should be economically and technologically feasible for licensed acupuncturists and local governments self-insured for no-fault, since the rule is only establishing fees for acupuncture treatment rendered by a licensed acupuncturist.

6. Minimizing adverse impact: This rule applies uniformly to regulated parties and is mandated by statute. This rule does not impose any additional burden on small businesses and local governments.

7. Small business and local government participation: In developing this proposal, the Department consulted with an acupuncturist's trade organization, no-fault arbitrators and the NYC Comptroller's Office. The Department considered the suggestion of permitting an evaluation and management (E and M) fee for each patient seen. Because the E and M performed by physicians is not similar to the procedures performed by a licensed acupuncturist, the Department concluded that utilization of an E and M fee is not warranted. This rule appeared in the Insurance Department's June, 2010 Regulatory Agenda.

1. Types and estimated numbers of rural areas: Insurers and self-insurers subject to this Part do business in every county in this state, including rural areas as defined under Section 102 (13) of the State Administrative Procedure Act. Some of the home offices of these insurers and self-insurers are located within rural areas. Some government entities that are self-insurers for no-fault benefits are located in rural areas. Some licensed acupuncturists are located in rural areas.

2. Reporting, recordkeeping and other compliance requirements; and professional services: There are no additional reporting or recordkeeping requirements created by the amendment to this part. It is not expected that professional services will be required to comply with the provisions of this part.

Insurers, self-insurers and licensed acupuncturists who provide services under the no-fault system should already have the Workers' Compensation Medical fee schedule.

The establishment of the fees will result in reducing the number of disputes that go to arbitration or court and the corresponding paperwork associated with it.

3. Costs: This rule imposes no compliance costs upon state or local governments unless they are self-insured for no-fault insurance. Insurers, self-insurers and licensed acupuncturists who provide services under the no-fault system should already have the Workers' Compensation Medical fee schedule. If they do not have the fee schedule, they must acquire it, currently at a cost of $65.

The establishment of fees for acupuncture services performed by licensed acupuncturists should result in savings, as the rule will reduce the number of disputes between insurers and licensed acupuncturists, resulting in more uniform, efficient and cost-effective processing and payment of no-fault claims. The establishment of the fees will also result in reducing the number of fee schedule disputes that go to arbitration and court to be resolved.

4. Economic and technological feasibility: Compliance with the rules should be economically and technologically feasible for licensed acupuncturists and local governments self-insured for No-fault, since the rule is only establishing fees for acupuncture treatments rendered by a licensed acupuncturist.

5. Minimizing adverse impact: The provisions of this Part apply to insurers, self-insurers and licensed acupuncturists that do business throughout New York State, including rural areas. It does not impose any adverse impact on rural areas.

6. Rural area participation: In developing this proposal, the Department consulted with an acupuncturist's trade organization and no-fault insurance arbitrators. The Department considered the suggestion of permitting an evaluation and management (E and M) fee for each patient seen. Because the E and M performed by physicians is not similar to the procedures performed by a licensed acupuncturist, the Department concluded that utilization of an E and M fee is not warranted. This agency action appeared as a proposal in the Insurance Department's June 2010 Regulatory Agenda.

The proposed amendment should have no adverse impact on jobs or economic opportunities in New York State because it simply establishes, for the purposes of no-fault reimbursement, fees for licensed acupuncturists.