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SB 1402 —Ratification of Department of Financial Services Rules

by Senator Simmons

This summary is provided for information only and does not represent the opinion of any Senator, Senate Officer, or Senate Office.

Prepared by: Banking and Insurance Committee (BI)

Florida’s workers’ compensation law requires that the provider reimbursement manuals setting maximum reimbursement rates for medical services must be updated every 3 years. Since the 2015 Legislature adjourned, the Department of Financial Services (DFS) has adopted amendments to the rule incorporating by reference the Florida Workers’ Compensation Health Care Provider Reimbursement Manual, 2015 Edition (2015 Edition). The 2015 Edition sets out the policies, guidelines, codes, and maximum reimbursement allowances for services and supplies furnished by health care providers under the workers’ compensation statutes. The 2015 Edition adopted as part of Rule 69L-7.020, F.A.C., Florida Workers’ Compensation Health Care Provider Reimbursement Manual, 2015 Edition (rule), on July 16, 2015, and submitted for ratification on November 3, 2015.

The Statement of Estimated Regulatory Costs developed in conjunction with the rule shows that it has a specific, adverse economic effect, or increases regulatory costs, exceeding $1 million over the first 5 years the rule is in effect. Accordingly, the rule must be ratified by the Legislature before it may go into effect. The bill ratifies the rule. The scope of the bill is limited to this rulemaking condition and does not adopt the substance of any rule into the statutes.

The bill will have a significant negative fiscal impact to state expenditures from the State Risk Management Trust Fund (SRMTF) within the DFS. The DFS Division of Risk Management (division) estimates an increase in workers’ compensation expenses for the division by $2.1 million in FY 2016-17, $2.1 million in FY 2017-18, and $2.2 million in FY 2018-19.

The impact to local government and the private sector is indeterminate. However, local governments and private employers responsible for paying workers’ compensation claims or obtaining workers’ compensation insurance will incur increased costs due to the increase in the maximum reimbursements for providers.

If approved by the Governor, these provisions take effect on July 1, 2016.

Vote: Senate 40-0; House 116-0