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California: Delay in Authorizing Secondary Treater Can Lead to Penalty

April 18, 2019 (4 min read)

A recent panel decision (Pena v. Aqua Systems (February 23, 2019) 2019 Cal. Wrk. Comp. P.D. LEXIS —) clarifies two previously unresolved issues concerning secondary treaters. First, that a referral for treatment with a secondary treating physician does not need to be initiated by the PTP. It can originate with the injured worker’s designation based on the recommendation of a QME. Second, that the mere selection of a secondary treating physician is not subject to Utilization Review (UR) because selection, alone, is not a request for a specific course of medical treatment. Consequently, the selection of a secondary treating physician does not require a Request for Authorization (RFA).

The relevant facts are as follows. Pena claimed injury AOE/COE to various body parts including the psyche. A dispute arose as to whether defendant unreasonably failed to authorize medications and pay medical mileage expenses. At the trial, defendant stipulated that Pena sustained industrial injury to his head, neck, back and shoulders. A decision issued finding Pena in need of further medical treatment and that defendant unreasonably delayed the payment of medical mileage expenses, for which a 25% penalty was assessed. No finding was made with respect to Pena’s claim of psychiatric injury.

Following the award, Pena was evaluated by a Psychiatric Panel QME, who diagnosed him with major depression, pain disorder, and cognitive disorder, all on an industrial basis. Psychiatric and neurological treatment was recommended. Based on those recommendations, Pena’s attorney sent a letter to defendant’s attorney, designating Dr. Lorant, a psychiatrist, as a secondary treater. Defendant declined to authorize the selection without an RFA from Dr. Lorant. Defendant did send Pena the link to its MPN; however, there were no psychiatrists or psychologists within the two counties proximate to Pena’s residence. Pena then claimed that defendant unreasonably failed to promptly provide psychiatric treatment and requested a trial on injury to the psyche, need for psychiatric treatment, penalties for an unreasonable delay in providing treatment, and attorney fees per Labor Code section 5814.5. A few days before trial defendant authorized treatment with Dr. Lorant.

The WCJ found defendant unreasonably failed to authorize medical treatment and assessed a 25% penalty against the costs of the first visit with Dr. Lorant. He also awarded attorney fees per Labor Code section 5814.5. He failed to make a finding of industrial psychiatric injury, although the Opinion supported such a finding. Defendant sought Reconsideration and or Removal.

The panel agreed with the WCJ that the record supported a finding of injury AOE/COE to the psyche, noting the lack of basis for any genuine doubt on defendant’s part. Therefore, defendant was obligated to authorize psychiatric treatment when it was requested by Pena. In unanimous agreement, the panel rejected defendant’s claim that it had no obligation to respond to Pena’s request to be seen by Dr. Lorant as a secondary treater because there was no RFA or the opportunity to conduct Utilization Review (UR). The panel reasoned that because the selection of a secondary treater is not a request for a specific treatment regimen, no RFA is required. If and when psychiatric treatment recommendations are made, defendant will be obligated to conduct UR. In the meantime, defendant’s failure to timely authorize the selection of secondary physician Dr. Lorant made it liable for penalties.

The unanimous panel also rejected defendant’s contention that only the PTP can make a referral for treatment by a secondary physician. It emphasized the absence of statutory or regulatory authority for such a requirement

Defendant also challenged the award of attorney fees as a penalty pursuant to Labor Code section 5814.5 on the basis that psychiatric treatment was authorized prior to the issuance of the award regarding treatment of the psyche. The majority, with one Commissioner dissenting, agreed with defendant, citing the en banc decision in Ramirez v. Drive Financial Services (2008) 73 Cal. Comp. Cases 1324 (Appeals Bd. en banc.) At the time defendant unreasonably failed to authorize Pena’s selection of Dr. Lorant as the secondary treater, there had been no finding of psychiatric injury and need for treatment. Consistent with Ramirez, the majority rescinded the award of Labor Code section 5814.5 fees. The dissenting Commissioner argued that the majority’s reading of section 5814.5 is too narrow and would have allowed the fee since there was a prior award (albeit, not as to psychiatric injury or treatment) when defendant failed to authorize Pena’s selection of a secondary treater.

The key take always from this case can be summed up as follows: Defendants are expected to promptly respond to and approve (without an accompanying RFA) secondary treatment requests even if the request is not initiated by the PTP. An unreasonable failure to do so is likely to result in a section 5814 penalty assessment. As to section 5814.5 attorney fees to enforce an award, it is expected that Ramirez will remain controlling.

Practitioners should check the subsequent history of any cases before citing to them.

Any information or opinions contained in this commentary are not necessarily endorsed by LexisNexis® or its affiliates.

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