Workers Comp Zone


In football it’s often relatively easy to gain big yardage in mid-field plays. But as you get closer to the goal line resistance often stiffens.

So it is with workers’ comp. Consensus on how to change the system is often hard to achieve.

As September looms on the horizon, and California’s legislative season comes to a close, the notion of consensus will be tested.

For months now there has been buzz that if there were any significant California reforms they would probably be incorporated into the “Mendoza bill”, SB 1160 (sponsored by Senator Tony Mendoza who chairs the Senate Labor and Industrial Relations Committee).

While a number of comp bills have advanced through the legislative process (AB 1244, AB 1643, AB 1922, AB 2086 and SB 563, all of which I’ll blog about over the next several weeks), SB 1160 has remained a mystery.

Meanwhile, the DWC convened extensive stakeholder meetings to develop a proposal for legislative language, presumably to be incorporated in SB 1160. I participated in that process, as did a handful of applicant attorneys, along with a number of folks from various stakeholder groups.

Although a “final language” version of the DWC’s proposal has been circulating, it may not be the final final, so I’ll hold off deep analysis for now.

But here is a broad summary of some of the more significant portions in the version that was circulated at the end of last week:

The proposal would exempt certain medical services for UR during the first 30 days after an injury. It would prohibit UR companies giving financial incentives to reviewers based on the number of denials or modifications issued. Claims administrators would have to disclose to employers and the DWC any financial interest they have in UR providers. UR providers would have to be accredited. Timelines are set for handling UR and IMR for formulary disputes. Carriers would have to report UR data to the DWC. UU telephone access for peer to peer discussion would be mandated during California business hours. MTUS updates would be exempt from formal rule making though there would still be a public comment and hearing period. Lien claimants would have to sign verified declarations that they are qualified to file the lien. Lien assignment language is tightened up. Providers who are criminally charged with fraud would have their liens stayed pending disposition of the criminal case. Labor Code 5710 fees for applicant attorneys covering the deposition of the worker would still be awarded by the WCAB but the DWC would determine a range of reasonable fees. Rules would be set to verify the identity and credentials of interpreters. The DWC would be required to adopt rules regarding a notice to be provided to employees that they may seek treatment outside the workers’ comp system.

But today Greg Jones’ article is headlined “Observers Ambivalent on DIR Legislative Proposal”. 

Some stakeholders apparently are questioning the significance of exempting selected treatments from UR in the first 30 days. Typical concerns are (from the employer/insurer view) that this is just the first step in undermining UR or (from the worker view) that this will be of limited impact since there often is little UR of accepted injuries in the first 30 days and thus it will do little to control frictional costs.

The 30 day aspect of the proposal may be underwhelming but is a reasonable tweak to the UR system that may help some workers. A RAND presentation delivered at CHSWC earlier this year had also noted that some other states exempt a range of medical services from UR.

The accreditation provision, the financial incentives ban and the financial interest disclosure provision are all important and worthy of support.

In his piece Jones also mentions concerns about the lien provider affidavits. The proposed amendments to Labor Code 4903.05 requiring a declaration under penalty of perjury are largely aimed at abusive treatment on a lien practices. While this is not generally a problem in Northern California, the problems in Southern California are rampant.

A physician filing a lien would be required to declare under penalty of perjury that he/she is providing treatment under an MPN, or was the AME or QME, or that it was for an “emergency medical condition defined under Health and Safety Code Section 1317.1 or treated per an authorization by the claims examiner, or “has made a diligent search and determined that the employer does not have a medical provider network in place” or “has documentation that medical treatment has been neglected or unreasonably refused to the employee”.

Apparently some critics claim that this will limit access to treatment, particularly for claims that are initially denied but later accepted. That argument seems weak, however, given the latter two exceptions. Where a claim is on delay or denied then the claim would fall within the last exception .

The Northern California system functions OK without large volumes of doctors “treating on a lien”, and there is no reason I can think of to continue the dichotomy in the way cases are handled around the state.

I’m sure that discussions about these provisions (and other reforms) are ongoing as this is written, so stay tuned.

Julius Young