Medical Providers Prohibited From Reporting to Credit Agencies
NJ Governor Murphy has signed legislation (S.3036) that prohibits a provider to an injured worker of medical, surgical, other treatment, or hospital service according to the workers' compensation law, R.S.34:15-1 et seq., from reporting any portion of their charges which are alleged to be unpaid to any collection or credit reporting agency, bureau, or data collection facility.
A. NJ Medical Fees
The NJ workers’ compensation does not have a medical fee payment schedule. The employer or insurance carrier may negotiate and contract with a provider for medical fees. If a dispute arises, the medical fee is determined by a judge of compensation.
B. NJ No Choice of Physician
NJ injured workers are not permitted a free choice of their medical provider. All medical treatment incurred due to a work-related accident or occupational illness must be authorized and furnished by the employer or insurance company, which selects the medical provider and authorizes payment for medical treatment.
II. What the New Law Mandates
A. Prerequisites to Credit Reporting
As a result of the new law, a provider may only report such charges when:
1. A judge of compensation within the Division of Workers’ Compensation has fully adjudicated the rights and liabilities of all parties, including the rights of the claimant regarding the payment of these charges, or
2. When a notice of a stipulation settlement or an order approving settlement regarding the payment of these charges has been filed with the court.
Upon a finding of non-compliance with the provisions of the bill, a judge of compensation within the Division of Workers’ Compensation, in addition to other provisions under the workers' compensation law, may:
a. Order the non-compliant provider to retract the medical, surgical, other treatment, or hospital service charges reported to the collection or credit reporting agency, bureau, or data collection facility;
b. Impose a fine on the non-compliant provider, not to exceed $5,000, payable to the Second Injury Fund;
c. Order the non-compliant provider to pay a reasonable counsel fee in connection with a claimant for payments who has suffered damage to credit rating due to the reporting of unpaid medical, surgical, other treatment, or hospital service charges to a collection or credit reporting agency, bureau, or data collection facility;
d. Order the non-compliant provider to take such steps as are necessary, within 30 days of the order, to rehabilitate the credit record of a claimant, with a showing made to the court of the efforts made in that regard; and
e. Order a non-compliant provider to pay an award of damages to the claimant not to exceed 25 percent of the medical, surgical, other treatment, or hospital service reported by the non-compliant provider to the collection or credit reporting agency, bureau, or data collection facility, the minimum award being $350.
III. Unintended Consequences
While the initial intent of the legislation is to protect injured workers and their credit ratings, it remains to be seen whether fewer medical providers will offer medical care without employer or insurance company approval. The law has the potential to shift the cost to other revenue sources, including private healthcare systems and government programs funded by taxpayers at-large,
IV. Free Choice of Physician
To encourage greater medical participation, this legislation may ultimately encourage further legislation allowing injured workers the right to choose their physician to provide medical care for work-related accidents and injuries.
See: S3030 P.L.2019, c. 416, eff. 1/21/2020.
Jon L. Gelman of Wayne, NJ, is the author of NJ Workers’ Compensation Law (West-Thomson-Reuters) and co-author of the national treatise, Modern Workers’ Compensation Law (West-Thomson-Reuters). For over five decades, the Law Offices of Jon L Gelman 1.973.696.7900 firstname.lastname@example.org have represented injured workers and their families who have suffered occupational accidents and illnesses.
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