California SB 863: Commentary on Proposed Independent Medical Review Regulations

California SB 863: Commentary on Proposed Independent Medical Review Regulations

On November 27, 2012, the DWC posted on the DIR website proposed “emergency” regulations for implementation of the Independent Medical Review (IMR) Process pursuant to the reform language of SB863:

http://www.dir.ca.gov/dwc/DWCWCABForum/1.asp

DWC welcomes comments from the general public on these proposed regulations through this Friday, December 7, 2012. To join in the discussion of these rules, click on the link above, then click on the “Forum name” Independent Medical Review. Comments by others may be viewed at this site. And suggestions by other members of the community may be posted at this site by clicking on the link entitled, “Please review forum comments here.” Highlights of the proposed regulations are listed below. Commentary and queries are indicated by the bolded text.

I. Outline of the New Regulations Implementing the IMR Process:

(The following is a list of the 12 regulations that were either revised or created as part of this IMR implementation process.)

A. Proposed Utilization Review (UR) Regs:

1. 9792.6 – UR Definitions for Dates of Injury (DOI) before 1.1.2013 and medical treatment (MT) requests before 7.1.2013

2.  9792.6.1 – UR Definitions for DOI after 1.1.2013 and MT requests after 7.1.2013

3.  9792.9 – UR Standards for DOI before 1.1.2013 and MT requests before 7.1.2013

4.  9792.9.1 – UR Standards for DOI after 1.1.2013 and MT requests after 7.1.2013

5.  9792.10 – UR – Dispute Resolution for DOI before 1.1.2013 and MT requests before 7.1.2013

B. Proposed Independent Medical Review (IMR) Regs:

1. 9792.10.1 – IMR = UR Dispute Resolution for DOI after1.1.2013 and MT requests after 7.1.2013

2. 9792.10.2 – DWC Form IMR-1

3. 9792.10.3 – IMR Process

4. 9792.10.4 – IMR - Assignment & Notification

5. 9792.10.5 – Transfer of Records to IRO

6. 9792.10.6 – IMR Standards and Time frames

7. 9792.10.7 – Appeal of IMR determination

II. Proposed Utilization Review (UR) Regs:

1. 9792.6 – UR Definitions Dates of Injury (DOI) before1.1.2013 and MT requests before 7.1.2013

Amended to clarify that this regulation applies only to DOI before1.1.2013 and MT requests before 7.1.2013

2. 9792.6.1 – UR Definitions DOI after1.1.2013 and MT requests after 7.1.2013

Several definitions were added and/or revised. One major difference from the previous regulation is the addition of definitions for “approval” and “denial” as follows:

(a) “Approval” means a decision that the requested treatment or service is medically appropriate to cure or relieve.

(g) “Denial” means a decision by a physician reviewer that the requested treatment or service is not medically necessary.

COMMMENTARY: The definitions above were not included in the original 8 CCR 9792.6  list of UR definitions. It’s curious that the words used to define qualifying MT are different than those included in LC 4600. LC 4600 defines medical treatment as that which is “reasonably required to cure or relieve.” Do these three terms, “medically appropriate,” “medically necessary,” and “reasonably required” all mean the same thing? It will be interesting to see what difference, if any, this change in semantics means to the overall authorization of MT. Most likely we won’t know the answer to that until the courts interpret these sections. However, with the new IMR provisions, these issues will no longer be brought before a judicial tribunal.

9792.6.1(c) is amended to include, “Unless otherwise indicated by context, “claims administrator” also means the employer.”

QUERY: Does this mean that service of a MT request or IMR request on the employer, rather than on the claim administrator, is sufficient to trigger the relevant time period?

3. 9792.9 – UR Standards before 1.1.2013 and MT requests before 7.1.2013

COMMENTARY: Most of these subsections remain the same with some exceptions:

9792.9(b) Inserts a new section explaining that UR may be deferred if liability is disputed.

9792.9(b)(1) Changes the term “working day” which is not defined in the code, to “business day” which is defined in Regulation 9792.9(c)(5) and in the Labor Code. This should provide some clarification, as the two terms have been used interchangeably in the past. It is not clear if they mean the same thing.

9792.9(b)(1)(A) – (E) Explains the claims administrator’s duties and time limits in the event of a deferral if liability is disputed.

9792.9(l) Inserts a new section explaining that if the UR decision is sent on or after 7.1.2013, advising the injured worker (IW) that if he or she disagrees with the UR decision, he or she must appeal using the new IMR process.

COMMENTARY: This seems to suggest that if a MT request was made prior to 7.1.2013, but the UR decision did not issue until after that date, the medical dispute resolution process would be the IMR, rather than filing for an expedited hearing. It will be interesting to see if the courts interpret this mandate to be compliant with the new LC Section 4610.5(a) which states that the IMR process applies to DOI after 1.1.2013 and MT requests on or after 7.1.2013.

9792.9(o) – Clarifies that the UR decision will remain in effect for 12 months.

COMMENTARY: This is to preclude physicians from repeatedly making MT requests that have already been put through the UR process.

4. 9792.9.1 – UR Standards after 1.1.2013 and MT requests after 7.1.2013

COMMENTARY: This is an entirely new regulation which sets forth the new UR standards which is intended to be consistent with the provisions of SB863.

9792.9.1(a) MT Request must be on a specific form referred to as DWC RFA Form found in 8 CCR 9785.5.

COMMENTARY: Presumably, narrative MT requests from physicians will no longer be accepted, or at the very least will no longer trigger the UR time periods.

9792.9.1(a) Since the UR strict time period begins at the time the claims administrator receives the MT request, the date of receipt is critical. Said date has been defined as follows:

9792.9.1(a)(1) If sent by FAX, date is the date the MT request was FAXed.

9792.9.1(a)(2)(A) If sent by mail, date is the date of deposit plus 5 business days.

9792.9.1(a)(2)(B) If sent by certified mail, the date is the date entered on return receipt.

9792.9.1(a)(2)(C) If no documentation of receipt or evidence of mailing, date is 5 calendar days after the latest date the sender wrote on document.

COMMENTARY: This last definition is puzzling. One can only surmise what method of proof might be utilized to establish the last date the sender wrote on the document… carbon dating, perhaps?

If these regulations are implemented as proposed, parties should be mindful of the distinction between business days and calendar days, when creating UR checklists and flow charts.

9792.9.1(b) If claims administrator disputes liability, MT request may be deferred. However, claims administrator must tell IW & applicant attorney (if applicant is represented) within 5 business days from receipt of DWC RFA Form.

9792.9.1(c) UR time period:

(1) The UR time period begins on the 1st day after the claims administrator receives the DWC RFA Form.

(2) If form not complete per 9792.6(u) – claims administrator may return it to the doctor w/in 5 business days from receipt. (Time period does not begin until a completed DWC RFA Form is received.)

(3) UR must be completed within 14 calendar days from initial receipt of a complete DWC RFA Form.

9792.9.1(e) Discusses procedures for UR denials, modifications & delays.

9792.9.1(e)(5) Specifies what needs to be included in a UR denial.

9792.9.1(e)(5)(G) UR denials need to include a completed (except for the applicant’s signature) postage pre-paid Application for IMR (DWC Form IMR-1) and instructions for the IW to file the Form within 30 calendar days of receipt of decision.

9792.9.1(g) Mandates that if UR is delayed due to missing information from the doctor, the claims administrator must document the attempts by the claims administrator or the  reviewer to obtain the necessary medical information.

QUERY: This sounds like a good idea, but what is the remedy if the claims administrator fails to do this? Would the UR decision be deemed invalid? If the UR decision is deemed invalid, then would all further medical dispute proceedings be conducted at an expedited hearing before a WCJ?

9792.9.1(j) –As stated above with regard to 8 CCR 9792.9(o), this clarifies that the UR decision will remain in effect for 12 months.

COMMENTARY: This is most likely to preclude physicians from repeatedly making MT requests that have already been put through the UR process.

5. 9792.10 – UR – Dispute Resolution for DOI before 1.1.2013 and MT requests before 7.1.2013

Amended to clarify that this regulation applies only to DOI before1.1.2013 and MT requests before 7.1.2013.

III. New IMR Regs:

1. 9792.10.1 – UR  Dispute Resolution = IMR for DOI after1.1.2013 and MT requests after 7.1.2013

9792.10.1(a) begins with a list of definitions.

COMMENTARY: It’s not clear why these definitions were not included in the definition section of 8 CCR 9792.6.1.

9792.10.1(a)(4) mandates that MT that is considered reasonable and necessary must be based on one of the following which shall be applied in the order listed, “allowing reliance on a lower ranked standard only if every higher ranked standard is inapplicable”:

(A) MTUS (LC 5307.27)

(B) Peer-reviewed scientific and medical evidence regarding the effectiveness of the disputed service.

(C) Nationally recognized professional standards.

(D) Expert opinion.

(E) Generally accepted standards of medical practice.

(F) Treatments that are likely to provide a benefit to a patient for conditions for which other treatments are not clinically efficacious.

9792.10.1(b)(2) If the injured worker (IW) objects to the UR decision, the IW must object by filing with the Administrative Director an IMR request on the Application for IMR, DWC Form IMR-1.

9792.10.1(b)(2)(A) The IW may designate someone, including presumably their attorney to act on their behalf. However, the designation must be made AFTER the UR decision issues or it will not be valid.

COMMENTARY: It’s not clear why this last line was inserted, perhaps to mandate or enhance the communication process between the IW and his or her attorney.

2. 9792.10.2 – DWC Form IMR-1

“Placeholder for the DWC Form IMR-1.”

3. 9792.10.3 – IMR Process

9792.10.3(a) Sets forth the process by which the AD must issue a determination as to whether MT request is eligible for IMR, once the IW files a request for IMR.

COMMENTARY: It’s curious that there does not appear to be a specific time frame indicated as to when the AD must make a determination as to whether the MT request is eligible for the IMR process.

9792.10.4(e) If IW’s request is deemed not eligible for IMR, the IW may appeal by filing a Petition with the WCAB.

COMMENTARY: It is presumed that this appeals process would follow the same rules for any other appeal from an AD’s decision as set forth in 8 CCR §§10950, 10290. (Basically, the matter is referred to a WCJ for hearing, after which the aggrieved party may file a Petition for Reconsideration with the WCAB.)

4. 9792.10.4 – IMR  - Assignment & Notification

9792.10.4 – Within 1 business day after the request for IMR is deemed eligible, the AD must issue a notification to all parties that an Independent Review Organization (IRO) has been assigned to review the MT request.

9792.10.4(e) The notification shall include a statement that within a specified time period of the date designated on the notification referred to above, the IRO must receive all relevant records listed in 9792.10.5 below.

  • If the notification is sent by mail, the time period is 15 calendar days.
  • If the notification sent by FAX, the time period is 12 calendar days.

If these time periods are not met, a penalty of $5000 per day may be imposed.

COMMENTARY & QUERIES: Compliance with this regulation and 9792.10.5 may prove to be an arduous task for some claims administrator’s offices, and the fine of $5000 per day may be rather excessive. Perhaps enforcement will be limited to situations where there is an established business practice of delay, rather than isolated incidents.

On the other hand, it is not clear when the time period for compliance begins. This regulation seems to indicate that the time period begins on the “date designated on the notification.” But how is “date designated on the notification” defined?

Is it the date the notice is prepared?

Is it the date the notice is mailed or FAXed?

Or is this the date sometime in the future, upon which the AD believes the process should commence for the transfer of records?

If it is the latter, then perhaps the time period is more than sufficient.

5. 9792.10.5 – IMR – Transfer of Medical Records to IRO

9792.10.5(a)(1) Mandates that the claims administrator provide all relevant records within 15 days of receipt of notice of IRO.

COMMENTARY: Hum… “15 days of receipt of notice of IRO” appears to be a different time frame than the one listed in 9792.10.4 above, which states that if the notification is sent by mail, the time period is “15 days of the date designated on the notification.” Again, there’s no definition of “date designated on the notification,” so it’s unclear what that means. In addition, 9792.10.4 includes a lesser time frame if sent by FAX. There is no similar provision in 9792.10.5.

9792.10.5(a)(1)(A) Details the documentation that must be transmitted to the IRO.

9792.10.5(b)(1) The IW may provide documentation, but must serve all documentation on the claims administrator, if he or she has not previously done so.

QUERY: Is it sufficient for the IW to serve the documents on the defense attorney given the change in the definition of claims administrator to include “employer”? (See 9792.6.1(c) which was amended to include, “Unless otherwise indicated by context, “claims administrator” also means the employer.”)

6. 9792.10.6 – IMR – Standards & Timeframes

9792.10.6(c) IRO’s determination must include a “description of the qualifications of the medical reviewers.”

9792.10.6(d) The names of the reviewers for the IRO will remain confidential.

COMMENTARY & QUERY: This is a curious mandate, given that there are few grounds to appeal the IRO determination, of which two are bias and conflict of interest. However, if the identities of the reviewers are confidential, how would anyone ever be able to prove bias or conflict of interest?

9792.10.6(d)(1) The IRO must issue a decision within 30 days of receipt of DWC Form IMR-1 and the supporting documentation.

COMMENTARY & QUERIES: As discussed above, it’s unclear what the exact deadline is for the claims administrators to transfer the “supporting documentation” to the IRO. The IRO’s time period for review does not begin until this information is received. It will be interesting to see how this time period will be enforced.

Will there be an acknowledgement required on behalf of the IRO that they have received “the supporting documentation?”

Will there be an audit process to review compliance with this provision?

And if there is delay, what is the remedy? Will the MT request be sent to another IRO? That would seem to defeat the purpose?

If there is a delay, will the MT request be sent to the WCAB for a judicial resolution?

If there is a delay, would the IRO decision stand, but payment to the IRO be withheld? If so, that would also seem to countermand the intent of this section, given that the employer is paying for the IRO services.

9792.10.6(d)(3) If good cause is shown, the IRO determination time period may be extended by 3 days.

7. 9792.10.7 – IMR- Implementation & Appeal

9792.10.7(c) The parties may appeal a final determination of the Administrative Director by filing a petition with the Workers' Compensation Appeals Board and serving a copy on all interested parties, including the Administrative Director, within 30 days of mailing of the final determination.

COMMENTARY: It’s interesting that although only the IW may request an IMR, either party may appeal an IMR decision.

9797.10.7(d) Grounds for appeal are limited to the following:

(1) The Administrative Director acted without or in excess of the Administrative Director’s powers.

(2) The final determination of the Administrative Director was procured by fraud.

(3) The Independent Medical Reviewer was subject to a material conflict of interest that is in violation of Labor Code section 139.5.

(4) The final determination was the result of bias on the basis of race, national origin, ethnic group identification, religion, age, sex, sexual orientation, color, or disability.

(5) The final determination was the result of a plainly erroneous express or implied finding of fact, provided that the mistake of fact is a matter of ordinary knowledge based on the information submitted for review pursuant to Labor Code section 4610.5 and not a matter that is subject to expert opinion.

QUERY: As discussed above, if the identities of the IRO reviewers are mandated to be confidential, how would anyone be able to determine bias or conflict of interest?

9797.10.7(e) If the decision of the IRO is reversed, the matter does not go to a judicial tribunal. Instead, a different IRO is selected. If a different IRO is not available, then the matter would be assigned by the AD to a different reviewer in the organization.

QUERY: Again, if the identities of the IRO reviewers are to remain confidential, how will anyone know if reviewer different from the original reviewer has been assigned in compliance with this section?

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