The Alaska Workers’ Compensation Board’s Medical Services Review Committee (MSRC) is advancing a proposed 2027 medical fee schedule that would establish new reimbursement limits and billing requirements for physician-dispensed, repackaged, topical, over-the-counter (OTC), and compounded drugs.
On August 7, 2026, the committee completed its fourth and final review of proposed revisions to the 2027 Medical Fee Schedule, which were then recommended to the Workers’ Compensation Board for approval on August 28th. The fee schedule amendments to 8 AAC 45.083 will proceed through the remaining rulemaking process, including public comment, final Board adoption, and filing with the Lieutenant Governor.
According to the revisions, physician-dispensed and repackaged drugs would be reimbursed using the original manufacturer NDC and existing AWP-based reimbursement formula. Separate repackaging, relabeling, dispensing, compounding, and handling fees are not reimbursable.
Topical medications and compounds would require documented medical necessity and a new prescription for each fill. Reimbursement would be based on lower-cost equivalent products and limited to new reimbursement caps. Topical compounds must also meet FDA-approved ingredient combination and ingredient-level billing requirements using original manufacturer NDCs.
Topical drugs would face the following reimbursement caps per 30 day supply (or prorated based on supply dispensed):
- $30 for OTC or private-label creams, gels, ointments, and lotions
- $70 cap for OTC or private-label patches
- $240 cap for compounded topical preparations
Non-topical compounds would require documented medical necessity, FDA-approved ingredient combinations, ingredient-level billing, and reimbursement based on the lowest available generic NDC. Pharmacy-compounded prescriptions are eligible for a single compounding fee of $10 for compounds with three or fewer ingredients or $20 for compounds with more than three ingredients.
OTC medications would be reimbursed using the lowest therapeutic equivalent AWP and would not be eligible for a dispensing fee.
Other changes include:
- Adding billing and reimbursement guidance for remote therapeutic monitoring
- Revising hearing aid and audiology reimbursement
- Clarification for DME reimbursement and rental limitations
The Division is targeting a January 1, 2027, effective date for these changes.
For ongoing coverage of the latest legislation and policy updates impacting workers' comp, visit the Healthesystems Advocacy & Compliance page for our weekly Regulatory Recap.
