Utilization Review in Admitted and Denied Case for Medical Providers

workcompliens
May 2010

Utilization Review

I.    Utilization Review in Admitted Case

 1.        In admitted cases, Utilization Review must be performed whenever a request for medical treatment is made.

    Supreme Court’s decision in State Comp. Ins. Fund v. Workers’ Comp. Appeals Bd. (Sandhagen) (2008) 44 Cal.4th 230 [73 Cal.
    Comp.Cases 981] (Sandhagen), the Supreme Court clarified that when an employer is faced with deciding whether to approve or
    deny the treatment recommendation of an injured worker’s physician, it must conduct utilization review pursuant to Labor Code
    section 4610.

    2.        Employers failure to perform a Utilization Review after request for medical treatment precludes the Employer from using the
    medical legal process to prove medical necessity, and the requesting medical providers reports are used to show medical necessity of the
    treatment.

    In State Comp. Ins. Fund v. Workers’ Comp. Appeals Bd. (Sandhagen) (2008) 44 Cal.4th 230 [73 Cal.Comp.Cases 981]
    (Sandhagen) the Supreme Court clarified  

    “Taken together, the language of sections 4610 and 4062 demonstrates that (1) the Legislature intended   for employers to
    use the utilization review process in section 4610 to review and resolve any and all requests for treatment, and (2) if
    dissatisfied with an employer’s decision, an employee (and only an employee) may use section 4062’s provisions to
    resolve the dispute over the treatment request.  An employer may not bypass the utilization review process and instead
    invoke section 4062’s provisions to dispute an employee’s treatment request.”

    3.        If the employer performs a timely utilization review and authorizes treatment it is a guarantee that the medical provider gets paid.

    4.        If the Carrier denies the necessity of the medical treatment through the timely utilization review process then the requesting
    provider may initiate the medical legal process.

    Supreme Court’s decision in State Comp. Ins. Fund v. Workers’ Comp. Appeals Bd. (Sandhagen) (2008) 44 Cal.4th 230 [73 Cal.
    Comp.Cases 981] (Sandhagen) held:

    “The Legislature made clear that an employer may not use section 4062 to object to a medical determination concerning
    medical issues “subject to section 4610” while expressly permitting employees to use section 4062 to resolve disputes
    over an employer’s decision not to approve treatment requests (Stats. 2004, ch. 34, § 14) — i.e., the plain language of
    section 4062 establishes that only employees may use section 4062 to resolve disputes over requests for treatment.  This
    limitation is made even clearer when the current section 4062 is compared to previous versions.  Former section 4062
    allowed employers to object to medical determinations concerning “the extent and scope of medical treatment . . . .”
    (Stats. 2003, ch. 639, § 17.)  In Senate Bill No. 899, the Legislature deleted that phrase.  (Stats. 2004, ch. 34, § 14.)”  

    5.        If Employer fails to perform a Utilization Review or performs it untimely and the carrier then initiates medical legal procedures, the
    medical legal reports are inadmissible to show the reasonableness of the medical treatment requested the medical provider.

    Supreme Court’s decision in State Comp. Ins. Fund v. Workers’ Comp. Appeals Bd. (Sandhagen) (2008) 44 Cal.4th 230 [73 Cal.
    Comp.Cases 981] (Sandhagen) held:

    “Accordingly, in light of the clear statutory language and the Legislature's purpose in enacting the utilization review
    process in section 4610, we conclude the Legislature intended to require employers to conduct utilization review when
    considering employees' requests for medical treatment. Employers may not use section 4062 as an alternative method for
    disputing employees' treatment requests.”

II.        Utilization Review in Denied Case


    1.        If Employer fails to deny injury within the 90 days the injury is deemed admitted and the procedures to Utilization Review of
    admitted claim govern.

    Cal Lab Code § 5402

    (a) Knowledge of an injury, obtained from any source, on the part of an employer, his or her managing agent, superintendent,
    foreman, or other person in authority, or knowledge of the assertion of a claim of injury sufficient to afford opportunity to the
    employer to make an investigation into the facts, is equivalent to service under Section 5400.

    (b) If liability is not rejected within 90 days after the date the claim form is filed under Section 5401, the injury shall be presumed
    compensable under this division. The presumption of this subdivision is rebuttable only by evidence discovered subsequent to the
    90-day period.

    2.        Within one working day after an employee files a claim form the employer is responsible for the first $10,000.00 in medical
    treatment regardless of whether they deny the injury thereafter, until the claim is denied or accepted.

    Cal Lab Code § 5402 (c) Within one working day after an employee files a claim form under Section 5401, the employer shall
    authorize the provision of all treatment, consistent with Section 5307.27 or the American College of Occupational and
    Environmental Medicine's Occupational Medicine Practice Guidelines, for the alleged injury and shall continue to provide the
    treatment until the date that liability for the claim is accepted or rejected. Until the date the claim is accepted or rejected, liability
    for medical treatment shall be limited to ten thousand dollars ($10,000).

    3.        Cal Lab Code § 5402 (c) applies to any date of injury – retroactive application

    Heike M. Ruvalcaba, Applicant v. Scott Roberg, DPM, State Compensation Insurance Fund, Defendants W.C.A.B. No. OXN
    0129714--Workers' Compensation Appeals Board (Panel Decision)Opinion Filed March 9, 2007

    “The consequence of SB 899 as presented in the language of Section 47, noting that any amendments or additions under
    SB 899 are to be applied prospectively regardless of the date of injury, would make subsection (c) of 5402 applicable to
    any pending case. This conclusion is consistent with the appellate decisions in Kleemann, supra, Marsh, supra, and Rio
    Linda Union School District v. Workers' Comp. Appeals Bd. (Scheftner) (2005) 131 Cal.App.4th 517 [70 Cal.Comp.
    Cases 999], and thus would justify the WCJ's disposition herein…”

    4.        If the Employer denies treatment based on causation then the Employer must initiate the medical legal process.

    En Banc Decision of Simmons v. California, 70 Cal. Comp. Cases 866 (W.C.A.B. 2005):

    “Where a utilization review physician finds that a treatment is medically necessary but questions whether the need for
    that treatment is causally related to the industrial injury, the defendant must either: (a) authorize the treatment; or (b)
    timely deny authorization based on causation within the deadlines set forth in section 4610(g)(1); timely communicate the
    denial based on causation to both the treating physician and the applicant within the deadlines set forth in section 4610(g)
    (3)(A); and timely initiate the AME/QME process within 20 days of the receipt of the utilization of physician’s report,
    if the employee is represented by an attorney, or 30 days, if the employee is unrepresented, in accordance with section
    4062(a) and…”

    5.        Utilization Review reports are not admissible to medical causation, only the reasonableness of the medical treatment.

    En Banc Decision of Simmons v. California, 70 Cal. Comp. Cases 866 (W.C.A.B. 2005):

    “A utilization review physician’s report is not admissible for the purpose of determining whether the industrial injury
    caused or contributed to the need for a particular treatment, i.e., a utilization review physician may address only the issue
    of whether a particular treatment is medically necessary;..”

    6.        If the employer denies the claim based on a medical legal prior to denying the claim the Employer is not entitled to another medical
    unless the treating physician puts medical causation to another body part in issues, then the Carrier has 20 days to initiate the medical
    legal process. ( See Lexis Article On Rule 30)

    Pursuant to 8 CCR 30 (d)(3), once a claim has been denied in its entirety, only the employee may request a Panel QME.
    Therefore, the Courts must look to the reports of the  self-procured treating physician.

    8 CCR 30 (d)(3) "Whenever an injury or illness claim of an employee has been denied entirely by the claims
    administrator, or if none by the employer, only the employee may request a panel of Qualified Medical Evaluators, as
    provided in Labor Code sections 4060(d) and 4062.1 if unrepresented, or as provided in Labor Code sections 4060(c) and
    4062.2 if represented."

                   En Banc Decision of Simmons v. California, 70 Cal. Comp. Cases 866 (W.C.A.B. 2005):

    “If in prescribing treatment for the disputed body part, the treating physician either explicitly or implicitly determines for
    the first time that the injury to the disputed body part is industrial, then utilization review is not appropriate. Instead,
    the defendant must initiate the AME/QME process within the deadlines established by section 4062(a)."

    7.        If the case is denied and the Employer does not perform a medical legal and a request for treatment with a determination by
    provider for causation then Employer has a second chance to do medical legal.

    En Banc Decision of Simmons v. California, 70 Cal. Comp. Cases 866 (W.C.A.B. 2005):

    “If in prescribing treatment for the disputed body part, the treating physician either explicitly or implicitly determines for
    the first time that the injury to the disputed body part is industrial, then utilization review is not appropriate.  Instead,
    the defendant must initiate the AME/QME process within the deadlines established by section 4062(a).”

    8.        It is the defendant’s duty to object to the treating physician’s causation determination and to initiate the AME/QME procedure
    under section 4062(a).


    En Banc Decision of Simmons v. California, 70 Cal. Comp. Cases 866 (W.C.A.B. 2005):

    “In essence, the defendant is objecting to the treating physician’s explicit or implicit determination that the need for the
    prescribed treatment was caused, in whole or in part, by the industrial injury.  Such an issue of causation is outside the
    scope of utilization review.  Accordingly, it is not the employee’s responsibility either to object to the treatment denial
    based on causation or to initiate the AME/QME procedure established by section 4062(a).  Rather, it is the defendant’s
    duty to object to the treating physician’s causation determination and to initiate the AME/QME procedure under section
    4062(a)”.

III.        Related Information

    1.        En Banc Decision of Simmons v. California, 70 Cal. Comp. Cases 866 (W.C.A.B. 2005):

    “Although the ACOEM guidelines are “presumptively correct on the issue of extent and scope of medical treatment”
    (Lab. Code, §4604.5(c) (emphasis added)), they are not presumptively correct on the issue of whether a need for medical
    treatment is causally related to the industrial injury.”

    2.        Labor Code Section 4610(a) states:

    “For purposes of this section, ‘utilization review’ means utilization review or utilization management functions that
    prospectively, retrospectively, or concurrently review and approve, modify, delay, or deny, based in whole or in part on
    medical necessity to cure and relieve, treatment recommendations by physicians, as defined in Section 3209.3, prior to,
    retrospectively, or concurrent with the provision of medical treatment services pursuant to Section 4600.”

    3.        Supreme Court’s decision in State Comp. Ins. Fund v. Workers’ Comp. Appeals Bd. (Sandhagen) (2008) 44 Cal.4th 230 [73 Cal.
    Comp.Cases 981] (Sandhagen) held:

    “The Legislature made clear that an employer may not use section 4062 to object to a medical determination concerning
    medical issues “subject to section 4610” while expressly permitting employees to use section 4062 to resolve disputes
    over an employer’s decision not to approve treatment requests (Stats. 2004, ch. 34, § 14) — i.e., the plain language of
    section 4062 establishes that only employees may use section 4062 to resolve disputes over requests for treatment.  This
    limitation is made even clearer when the current section 4062 is compared to previous versions.  Former section 4062
    allowed employers to object to medical determinations concerning “the extent and scope of medical treatment . . . .”
    (Stats. 2003, ch. 639, § 17.)  In Senate Bill No. 899, the Legislature deleted that phrase.  (Stats. 2004, ch. 34, § 14.)  “We
    presume the Legislature intends to change the meaning of a law when it alters the statutory language [citation], as for
    example when it deletes express provisions of the prior version . . . .”  (Dix v. Superior Court (1991) 53 Cal.3d 442, 461.)  
    State Fund would have us read “the extent and scope of medical treatment” back into the statute as one of the matters
    employers may object to under section 4062.  We decline to do so."     

    "Accordingly, in light of the clear statutory language and the Legislature’s purpose in enacting the utilization review
    process in section 4610, we conclude the Legislature intended to require employers to conduct utilization review when
    considering employees’ requests for medical treatment.  Employers may not use section 4062 as an alternative method for
    disputing employees’ treatment requests.”


    4.        En Banc Decision on Request for Spinal Surgery: Cervantes v. Workers' Comp. Appeals Bd., (En Banc) (2009)74 Cal. Comp. Cas.
    (MB) 1336  is as follows:

    “The Appeals Board held that the procedures and timelines governing objections to a treating physician’s recommendation for
    spinal surgery are contained in Labor Code sections 4610 and 4062 and in Administrative Director (AD) Rules 9788.1, 9788.11,
    and 9792.6(o) and are as follows:

    (1) when a treating physician recommends spinal surgery, a defendant must undertake utilization review (UR);

    (2) if UR approves the requested spinal surgery, or if the defendant fails to timely complete UR, the defendant must authorize the
    surgery;

    (3) if UR denies the spinal surgery request, the defendant may object under section 4062(b), but any objection must comply with
    AD Rule 9788.1 and use the form required by AD Rule 9788.11;

    (4) the defendant must complete its UR process within 10 days of its receipt of the treating physician’s report, which must
    comply with AD Rule 9792.6(o), and, if UR denies the requested surgery, any section 4062(b) objection must be made within
    that same 10-day period; and

    (5) if the defendant fails to meet the 10-day timelines or comply with AD Rules 9788.1 and 9788.11, the defendant loses its right
    to a second opinion report and it must authorize the spinal surgery.

IV.        Definitions of Utilization Review

    a.        Utilization Review (UR) is the process used by employers or claims administrators to review medical treatment requested for the
    injured worker to determine if the proposed treatment is medically necessary. All employers or their workers’ compensation claims
    administrators are required by law to have a UR program. This program is used to decide whether or not to approve medical treatment
    recommended by a physician.

    b.        UR begins when the request for authorization is first received, whether by the employer, claims administrator or utilization review
    organization (URO).

    c.        Authorization means assurance that appropriate reimbursement for a specific treatment will be paid. 8 CCR § 9792.6(b) sets forth
    how a doctor requests treatment, diagnostic tests or other medical services for an injured worker. A request for authorization may initially
    be made verbally, but it must be confirmed in writing within 72 hours of the doctor’s “First Report of Occupational Injury or Illness”
    (form DLSR 5021), the “Primary Treating Physician Progress Report” (DWC form PR-2), or in a narrative report that contains the same
    information required in the PR-2 form. If a narrative report is used, the document must be clearly marked at the top as a request for
    authorization. (8 CCR § 9792.6(o))

         d.        A non-physician reviewer may:

    • Request appropriate additional information necessary to render a decision (8 CCR § 9792.7(b)(3))

    • Approve a request for authorization (8 CCR § 9792.7(b)(3))

    • Discuss applicable medical guidelines with the requesting physician when requested treatment appears to be
    inconsistent with medical guidelines (8 CCR § 9792.7(b)(3))

    The non-physician reviewer may discuss the treatment plan with the requesting physician. If the requesting
    physician decides to make a change in the treatment plan, the physician should provide documentation for that
    change. (8 CCR § 9792.7(b)(3))

    e.        A "reviewer" is a medical doctor, doctor of osteopathy, psychologist, acupuncturist, optometrist, dentist, podiatrist or chiropractic
    practitioner licensed by any state or the District of Columbia, competent to evaluate the specific clinical issues involved in the medical
    treatment services that are the subject of the request for authorization, where these services are within the scope of the reviewer's practice.
    (8CCR § 9792.6(q))