Presiding Judge Jorja Frank Holds Hearing on Los Angeles WCAB District Office’s Notice of Intent to Consolidate Durable Medical Equipment Liens

On October 29, 2010 Presiding Judge Frank, again with the assistance of Associate Chief Judge Mark Kahn, presided over a hearing in connection with her notice of intent to consolidate liens filed by providers of durable medical equipment. Judge Frank informed the audience that 3700-4000 liens of all types are being filed each month at the Los Angeles Board, including DME liens that cannot be processed with the current available staff and judges. Judge Frank estimates that currently there are approximately 25,000 unprocessed paper liens at the Los Angeles district office, not including liens filed electronically.

Judge Frank and Judge Kahn sought input from the audience, consisting primarily of DME providers and defendants and their attorneys, to identify the common issues of law and fact that would create the bases for consolidation of such liens. Judge Frank indicated that she had reviewed approximately 600 DME liens and set 201 cases for this hearing because they represented the durable medical equipment most typically seen including: inferential units, TENS units, continuous passive motion devices, paraffin bath units, neurostimulators, airway pressure devices, and several others.

Although Judge Frank again made it clear that she wanted comments from individuals in the audience to be framed in the form of questions that would elucidate common issues of law and fact, much of the commentary from the individuals present on behalf of the DME community consisted of complaints that insurance companies, TPAs and self-insured employers had no incentive to negotiate in good faith and typically failed to return telephone calls seeking to resolve liens.  As other lien claimants commented at the earlier hearings, the DME providers want the Board to issue sanctions against defendants for refusing to negotiate in good faith and for not timely paying uncontested amounts.  The lien claimants avoided addressing the issue of reasonableness and necessity for the durable medical equipment provided.

Common issues of law and fact raised by the defendants included what threshold evidence the DME providers must produce in order to make a prima facie showing of entitlement to payment with regard to licensing, specifications relating to the equipment provided, and proper coding. These are the issues that routinely come up in negotiating with DME providers. Those lien claimants are often unwilling or unable to provide proof of licensing and specifications for their equipment. Often they routinely bill with improper or miscellaneous codes that make it impossible to determine the appropriate value for their goods.

As the judges had done at the two previous consolidation hearings concerning compound pharmaceuticals/topical medications and interpreters, it was noted that the Board prefers that defendants or lien claimants be the parties to file the petitions for consolidation. However it became clear by the end of the hearing that the DME provider community is generally opposed to the Board granting consolidation of their liens and is far more interested in participating in bulk settlement meetings with defendants including meetings that might involve a mediator overseeing those negotiations. They did not appear to be interested in arbitration of their liens.

Judge Kahn did indicate that he is currently developing a statewide list of independent bill reviewers to assist with this effort. He indicated he has 15 on his current list and invited others to make themselves available to assist during both settlements and in consolidation matters.

No decision was made with respect to whether the Board would order consolidation of DME liens. Unlike the two previous consolidation hearings Judge Frank did not conclude the hearing by requesting that defendants that wish to do so file their petitions for consolidation by a particular date. A further hearing on this topic was scheduled to take place on December 13, 2010 at 10:00 am at the WCAB in Los Angeles.

What This Means for You

It is too early to know precisely what the effect will be of the Board's eventual action or inaction on the subject. However, each defendant and lien claimant is free to take whatever action it perceives as in its best interest regardless of the ultimate decision by the Board whether to go forward with a consolidation on its own motion.

Contrary to the consolidation of compound pharmaceutical/topical medication and interpreting liens, GMK believes that this would be an appropriate time for defendants to file a petition for consolidation of DME liens.  The common issues of law and fact noted above are sufficiently narrow and specific enough to be addressed in a consolidation of those liens and to obtain a decision from the WCAB in a reasonable period of time.

© Copyright 2010 Goldman, Magdalin & Krikes, LLP. All rights reserved. Reprinted with permission.