Workers Comp Zone


SB 1160 (Mendoza), enacted in 2016, makes a number of changes to California utilization review.

One of the more unheralded provisions can be found in what has become Labor Code 4610 (o), which becomes operative January 1, 2018.

Here is what L.C. 4610 (o) provides:

“The administrative director shall develop a system for the mandatory electronic reporting of documents related to every utilization review performed by each employer, which shall be administered by the Division of Workers’ Compensation. The administrative director shall adopt regulations specifying the documents to be submitted by the employer and the authorized transmission format and timeframe for their submission. For purposes of this subdivision, “employer” means the employer, the insurer of an insured employer, a claims administrator, or a utilization review organization, or other entity acting on behalf of any of them.”

Until now the California Division of Workers’ Compensation has had no mechanism to track UR . Therefore, the DWC lacks reliable data on how many medical requests have been sent to UR, whether UR is conducted in a timely manner, what kinds of issues are subject to UR, whether UR is more prevalent in cases with chronic injuries versus newer, more simple injuries, and so forth.

So there is sort of a vacuum of definitive data on UR .

In the meanwhile, applicant attorneys offer anecdotal evidence of a high volume of UR, particularly in litigated cases and cases where the worker has multiple body part injuries or chronic conditions. An analysis done several years ago by CAAA’s consultant at the time, Mark Gerlach, concluded that UR denial rates varied by carriers but were often at a high rate.

On the other hand, the California Workers’ Compensation Institute has promulgated studies that essentially claim that most treatments are approved and that UR is relatively rare. Applicant attorneys believe that these studies fail to factor out a large number of no loss time injuries and other relatively minor cases.

In several years we may have a more definitive answer to this after the DWC has time to gather data.

Reporting from the annual DWC educational conference in Los Angeles, reporter Greg Jones  filed a piece on comments by DWC acting AD George Parisotto.

According to Jones, Parisotto indicated that “the division is trying to figure out the kind of data to require so it can get a better understanding of what is happening with utilization review.”

As 2017 progresses, the DWC will obviously be developing the process and substance of what UR information carriers will have to transmit.

All of this will undoubtedly be of interest to legislators and administrative policymakers as a new administration comes in once Governor Brown is termed out.

The burden of producing such information is clearly outweighed by the need to gather impartial information regarding the UR process as it is actually being conducted.

Stay tuned.

Julius Young