SB 863 adds new Section 4610.5 to the Labor Code, which orders the administrative director (AD) of the Division of Workers' Compensation (DWC) to designate organizations to resolve disputes over any utilization review decision modifying, delaying or denying a worker's request for treatment.
Section 4610.5 will apply to any injury on or after Jan. 1, 2013; or any utilization review decision that is communicated on or after July 1.
IMR organizations under the new law must give preference to a California licensed physician as the reviewer and maintain the confidentiality of that doctor's identity.
The reviewer must "promptly review all pertinent medical records of the employee, provider reports, and any other information submitted to the organization or requested from any of the parties to the dispute," and then has 30 days to render a decision on whether the disputed health care service was medically necessary to cure or relieve the injured employee of the effects of his or her injury. There are other various time lines for the provision of records, notices, etc. by both the employee and the employer, and of course the reviewer.
The reviewer must rely on one of the five enumerated standards in the order listed in 4610.5, allowing reliance on a lower ranked standard only if every higher ranked standard is "inapplicable to the employee's medical condition."
Those standards, in order, are: administrative guidelines under Labor Code 5307.27 (i.e. medical treatment utilization schedule or MTUS), peer-reviewed scientific and medical evidence, nationally recognized professional standards, expert opinion, the generally accepted standards of medical practice, and treatments that are likely to provide a benefit to a patient for conditions for which other treatments are not clinically efficacious.
New Labor Code section 4610.6 provides that the determination of the independent medical reviewer shall be deemed to be the determination of the administrative director and is binding on all parties; that it is presumptively correct and can only be set aside upon proof by clear and convincing evidence that the decision exceeds the administrative director's powers, was procured by fraud, was the result of impermissible discriminatory bias, was affected by a material conflict of interest on the part of the reviewer or contained a plainly erroneous finding of fact.
The concern of critics of this new system is the anonymity of the reviewer, that there is no physical examination, and the lack of any meaningful appeal process.
Those issues do raise some concern from a legal analytical standpoint, but in my opinion are not where the practical application issues arise.
The problem with the new IMR sections and the process introduced by this law is that the enforcement of the various time lines (both 4610.5 and 4610.6 set forth various time limitations by which actions are to be accomplished by the employer and the reviewer) which are there to expedite the delivery of care lack meaningful enforcement.
The only enforcement mechanism is found in 4610.5(i):
"An employer shall not engage in any conduct that has the effect of delaying the independent review process. Engaging in that conduct or failure of the plan to promptly comply with this section is a violation of this section and, in addition to any other fines, penalties, and other remedies available to the administrative director, the employer shall be subject to an administrative penalty in an amount determined pursuant to regulations to be adopted by the administrative director, not to exceed five thousand dollars ($5,000) for each day that proper notification to the employee is delayed. The administrative penalties shall be paid to the Workers’ Compensation Administration Revolving Fund."
The key words in subsection (i) are "that proper notification to the employee is delayed."
Note that this subsection doesn't say that the review itself is delayed - it is the "proper notification" that is the triggering event for the $5,000/day penalty.
I'm assuming that the drafters of this provision mean than "proper notification" is whether or not the employee is given notice in the form prescribed by the AD of the reviewer's decision. But doesn't the penalty apply if the decision itself is delayed? What if the decision is timely and what if "proper notification" failed due to an issue with the US Mail or whatever other communication protocol is used to notify the employee? What if there is untimely action on the part of the employer that does not delay "proper notification" (i.e. engaging in some other games that are not within the spirit of proper IMR)?
The preamble to SB 863 states that "The bill would prohibit an employer from engaging in any conduct that delays the medical review process, and would authorize the administrative director to levy certain administrative penalties in connection with this prohibition, to be deposited in the Workers’ Compensation Administration Revolving Fund."
But that's NOT what the actual law says.
The reviewer has certain time lines by which to issue the decision. But the employer's obligation seems to have been confused in the legislative drafting process.
4610.5(h)(3) states, "If the employer fails to comply with subdivision (e) at the time of notification of its utilization review decision, the time limitations for the employee to submit a request for independent medical review shall not begin to run until the employer provides the required notice to the employee."
But 4610.5(e) has nothing to do with notice - subsection (e) provides that a utilization review (UR) decision can only be appealed to the IMR and that there is no liability for treatment provided without authorization of the employer unless the UR decision is changed by the IMR.
California is derided as highly litigious. But when legislation comes down the pipeline that sloppily changes all the rules, there is nothing but litigation left.
This is what happens when the legislative process is artificially expedited.
"Most people don't plan to fail; they fail to plan." John L. Beckley
Let the litigation flourish...
The key words in subsection (i) are "that proper notification to the employee is delayed."
Note that this subsection doesn't say that the review itself is delayed - it is the "proper notification" that is the triggering event for the $5,000/day penalty.
I'm assuming that the drafters of this provision mean than "proper notification" is whether or not the employee is given notice in the form prescribed by the AD of the reviewer's decision. But doesn't the penalty apply if the decision itself is delayed? What if the decision is timely and what if "proper notification" failed due to an issue with the US Mail or whatever other communication protocol is used to notify the employee? What if there is untimely action on the part of the employer that does not delay "proper notification" (i.e. engaging in some other games that are not within the spirit of proper IMR)?
The preamble to SB 863 states that "The bill would prohibit an employer from engaging in any conduct that delays the medical review process, and would authorize the administrative director to levy certain administrative penalties in connection with this prohibition, to be deposited in the Workers’ Compensation Administration Revolving Fund."
But that's NOT what the actual law says.
The reviewer has certain time lines by which to issue the decision. But the employer's obligation seems to have been confused in the legislative drafting process.
4610.5(h)(3) states, "If the employer fails to comply with subdivision (e) at the time of notification of its utilization review decision, the time limitations for the employee to submit a request for independent medical review shall not begin to run until the employer provides the required notice to the employee."
But 4610.5(e) has nothing to do with notice - subsection (e) provides that a utilization review (UR) decision can only be appealed to the IMR and that there is no liability for treatment provided without authorization of the employer unless the UR decision is changed by the IMR.
California is derided as highly litigious. But when legislation comes down the pipeline that sloppily changes all the rules, there is nothing but litigation left.
This is what happens when the legislative process is artificially expedited.
"Most people don't plan to fail; they fail to plan." John L. Beckley
Let the litigation flourish...
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