The Second District Court of Appeal recently provided
some relief and respite from the hornets' nest that is a claims desk. In
Illinois Midwest Ins. Agency, LLC v.
WCAB/Rodriguez, the Second District of the California Court of
Appeal issued a decision that rejected the prior WCAB holding in Patterson v. The Oaks Farm (2014) 79 CCC 910, a
significant panel decision which set forth the burden of the defendant to show a "change
of circumstance requirement" before modifying an existing utilization review.
This was otherwise referred to as the "Patterson
exception." The Rodriquez case is certified for publication
and is now citable.
Sometimes a Court of
Appeal will render an opinion that tells the WCAB they should simply read what
the Labor Code says. Often,
it's not more complicated than that. In Rodriguez, we have such a
decision that returns some
sensibility to the treatment authorization process. Unfortunately, when a new
and significant case comes down, everyone
quotes it, but few understand it.
As many claims' professionals understand, some
authorizations seem to go on in perpetuity. For example, a diligent and contentious claims professional will get an RFA (request for authorization)
for physical therapy and/or some home healthcare following surgery. That is
often quite sensible and rational at the time. However, some of these
authorizations seem to go on in perpetuity because the defendant cannot show a
change in circumstances. In short, such authorizations often become de facto
permanent.
Then the primary treating physician will not report any
improvements or progress, and as such, any attempt to modify or rescind prior
authorization will result in an expedited hearing and a penalty petition. It's odd how an applicant can
receive tens of thousands of dollars--sometimes hundreds of thousands--and it
seems to show no improvement or relief. Yet the treatments and invoices roll
on. Thus applicants can hold this risk exposure
over the defendant until the defendant decides to buy it out.
Applicant attorney's often rely
on Labor Code Section 4601(k), which states that a utilization review (UR) can't
be revisited within a 12-month period if there is a "material
change in the facts." However, under this new finding, a defendant
no longer has the burden
to demonstrate this change. The UR reviewer may now, under evidence-based
medicine, provide rationale for terminating a prior authorization.
Does this mean that Labor Code Section 4601(k) is no
longer good law? Not at all.
Applicants may bring new RFA if circumstances change. They
often do--and should--if such a change is warranted. However, this never means
that something is always going to be authorized in perpetuity. The rationale
that, since it was provided before, it must now be provided without end or even
review has come to an end.
Unfortunately, there are some very nefarious actors who
will establish an ongoing level of care for which there is no end in sight--and, "imagine that," the applicant never seems to get
better until a big settlement is proffered.
In Rodriquez, the Court of Appeal returned
all such decisions back to utilization review and chided the WCAB for their
derivation from the Senate Bill (SB) 863, enacted in 2012. One of the
aspects of SB 863 was to get the applicant's bar out of the advocacy for
medical and lien providers. This was, in part, the basis for establishing the
UR under Labor Code 4610. The Court in Rodriguez opined that there
is statutory basis for an "ongoing treatment" exception to the
UR and independent medical review (IMR) process. Again, the Court directed the
WCAB to read the Labor Code.
In its rationale, the Court of Appeal returns to the
concept of rational and evidence-based medicine. UR and IMR remain the
controlling standard.
This does not mean that all ongoing treatment may be
halted or should be halted. Naturally, some are claiming the sky is falling and
that claims administrators will simply be cutting off treatment. This could not
be further from the truth. It simply states that all ongoing treatment will
still be subject to utilization review. That was the legislative intent all
along. UR and IMR keeps both the applicant and the defendant in check.
In fact, providers must now show a justification for their
ongoing treatment and demonstrate the efficacy and benefit to the applicant. If
there is no improvement or change in the applicant's condition, some treatments
will be discontinued.
Now, the battle lines are going to be drawn on this, and
there are other issues we might see.
For example, we will most likely see more claims of "chronic
and progressive" under Labor Code
§ 5410 & § 5804. The term "chronic and progressive"
in California cases generally refers to insidious and progressive diseases where
the conditions worsen over time.
This generally involves diagnoses
such
as complex regional pain syndrome, AIDS, industrial
cancers, hepatitis and some neurological conditions, such as CTE (chronic traumatic
encephalopathy). To that end, some findings
and awards or stipulated awards
may become risk time bombs for such abuse. With such claimed conditions, most
treatment modalities are rarely contained.
On the upside, this is also
good news for defendants defending against outrageous lien claims. Good UR and
IMR may now trounce some of these outrageous treatment liens. Like a lot
of aspects of law, it takes time for players on all sides to come to the
realization that the rules apply to all concerned.
Ultimately, this is good
news for the whole community. While some will decry the rollback of care, it
simply returns medicine to accepted and established medical standards.
Applicants will be better served by raising the standards in which treatment is
authorized, and defendants will have some relief from scheme that rewards
abuse.
Not all longstanding
medical modalities need to be reversed. However, the "free shot of goals" of
less than pristine players will now struggle to circumvent and game the
system.