New Mexico could become to medical marijuana Work Comp reimbursement what Colorado has been to recreational legalization – an experiment.

I attended the public hearing in Albuquerque on August 6 where work comp rule changes proposed by the Workers’ Compensation Administration (WCA) were discussed. The reason why I flew from Atlanta to Albuquerque was the changes to chapter 4, part 7 to address the mechanism by which employers will reimburse injured workers for their use of medical marijuana.

I first learned of these proposed rule changes when I was interviewed by WorkCompCentral’s Greg Jones for his July 21 article “To Add or Not to Add Marijuana to Fee Schedule” (subscription required). Greg quoted me as saying “It’s not a huge surprise that New Mexico is going down that path, primarily because of those past decisions. The legal writing is on the wall in regards to requiring employers to reimburse medical marijuana in New Mexico.”

As fortune would have it, I met Darin Childers, the New Mexico WCA Director, at the SAWCA conference in Williamsburg VA the following week and I posed the following question:

When he affirmed that was at least one of the initiating causes for these proposed rules, I knew I needed to be in Albuquerque. While the proposed rules essentially just provide the authority for the WCA to establish this structure, they raise many questions. For me, the biggest questions are in establishing medical appropriateness and creating a fee schedule for reimbursement.

While each of the court decisions had unique circumstances, they all affirmed that the use of medical marijuana by an injured worker could be classified as “reasonable and necessary” care and thus the employer was responsible for reimbursement. The new rules state “Medical cannabis may be a reasonable and necessary medical treatment only when an authorized health care provider certifies that other treatment methods have failed.”

  • But what does “other treatment methods” mean? It doesn’t say “all”, so does that mean the search for “other” does not need to be exhaustive?
  • Does “certify” mean it’s solely at the health care provider’s discretion without any need to provide evidence-based proof that medical marijuana is the best/only solution? Effective July 1, 2013 Official Disability Guidelines (ODG) is to be used to judge “reasonable and necessary” medical treatment, but since ODG does not recommend cannabinoids for pain …

So could the introduction of these rules lead to increased medical use of marijuana in work comp? Possibly, and one reason is how medical marijuana is currently being used in New Mexico (note, not specifically for work comp). Per their own statistics, the Medical Cannabis Program had 16,236 total patients as of July 30, 2015. Of those, the top five conditions cited as the rationale for its use are:

  1. PTSD (7,439 or 46%)
  2. Chronic pain (4,377 or 27%)
  3. Cancer (1,431 or 9%)
  4. Painful peripheral neuropathy (684 or 4%)
  5. HIV / AIDS (369 or 2%)

Cancer, peripheral neuropathy and HIV / AIDS are all very concrete diagnoses but very rarely associated with work comp. PTSD may not be as easily objectively measured but is certainly a definitive diagnosis once confirmed. With the continuing expansion of presumptions for public safety officers, PTSD is an increasingly frequent compensable work comp injury. But given the subjective nature of “chronic pain” and its overwhelming prevalence in work comp, doesn’t that scare you just a little bit? Isn’t that how our opioid epidemic got started, by physicians trying to alleviate chronic pain and determining those drugs were “reasonable and necessary” absent definitive scientific evidence?

Since ODG is only used for approval (not denial) of treatment, the dispute resolution process revolves around Utilization Review, Independent Medical Examinations or Peer Review. Essentially one opinion vs. another. Which means the courts will likely remain very busy, and judges could continue to be a primary method of resolving medical decisions and determining “reasonable and necessary”.

While the new rules outline what cannot be reimbursed — “paraphernalia” (not defined in the rules), expenses for personal production — and that an itemized receipt will be the billing mechanism, they generally reference a “fee schedule” in regards to how and how much. Obviously, the details will be embedded in the fee schedule, which is not included in the proposed rules. But how will that be determined?

While sharing some nachos afterwards with my friend and colleague Lisa Anne Forsythe, we contemplated the implications of establishing a fee schedule. The questions are endless so I will only list the most obvious:

  • Who pays? Is it direct from the employer, or will their insurance carrier or TPA or bill review vendor be handling it?
  • Does reimbursement, by whomever and whatever means, run counter to marijuana’s continued illegal status at the federal level?
  • For reimbursement purposes, will this be classified as medical treatment, a drug, or a pass-through?
  • If medical treatment, a CPT will be required (currently non-existent).
  • If a drug, a NDC will be required (other than Marinol® and Cesamet®, likewise currently non-existent).
  • If a pass-through, similar to mileage reimbursement, then the fee schedule cannot be applied through any automated means (the carrier or TPA or bill review vendor just generate a check). And without automation, everything is an exception and obviously open to errors. Additionally, the normal benchmarking mechanisms for assessing system-wide medical costs will be thwarted as the expenses will not be ear-marked as “medical” expenses.
  • How will appropriate pricing be determined? The goal is to price it at a gram or ounce. With so many blends/variations and levels of potency and forms (“medical cannabis” is defined in the new rules as “flower, bud, cannabis derived products, edibles, oils, tinctures, or any other form regulated by the department of health”), how deep and wide can a fee schedule actually be?

New Mexico has an enormous task ahead and a short time to accomplish the task. The new rules will be effective on October 1, which happens to be the date by which the first draft of the all-important fee schedule will be made available for public comment. Then, effective January 1, 2016, New Mexico will be the first state to codify work comp reimbursement for medical marijuana. If you manage work comp claims in New Mexico — or any other state that has legalized medical marijuana and has not explicitly excluded employer reimbursement — this is a “canary in the coal mine” moment.

Stay tuned because I’m watching with great interest. And I will likely be back in Albuquerque.

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