Author: WorkCompAcademy

The Division of Workers’ Compensation has posted an order adopting regulations to update the evidence-based treatment guidelines of the Medical Treatment Utilization Schedule (MTUS). The adoption follows a public hearing on the proposed adoption which occurred on July 18. According to the transcript of that hearing, there were no public comments made at that time.

The updates, effective for medical treatment services rendered on or after October 31, 2018, incorporate by reference the American College of Occupational and Environmental Medicine’s (ACOEM’s) most recent treatment guidelines to the General Approaches and Special Topics sections of the MTUS.

“We are publishing this Administrative Order one month before its effective date to give the public, especially treating physicians and utilization review physicians, 30 days to prepare before these evidence-based updates become effective,” said DWC Administrative Director George Parisotto.

The ACOEM guidelines that are incorporated by reference into the MTUS are:

• Traumatic Brain Injury Guideline (November 15, 2017)
• Prevention (May 1, 2011)
• General Approach to Initial Assessment and Documentation (July 25, 2016)
• Cornerstones of Disability Prevention and Management (May 1, 2011)

“DWC has incorporated the most recent guidelines to ensure the MTUS contain the most recent, state-of-the-art current evidence-based recommendations,” said DWC Executive Medical Director Dr. Raymond Meister.

The administrative order consists of the order and two addendum:

• Addendum one shows the regulatory amendments directly related to the evidence-based updates to the MTUS.
• Addendum two contains hyperlinks to the updated ACOEM guidelines adopted and incorporated into the MTUS by reference.

Since the ACOEM guidelines contain proprietary content, a commercial license from ReedGroup, the publisher of the ACOEM guidelines, is required when physicians and entities use the MTUS for commercial purposes.

On June 23, 2014, an inspector from Division of Occupational Safety and Health (DOSH) conducted an inspection of a job site in Oakland at which Raam Construction, Inc. served as general building contractor. Following this inspection, DOSH cited Raam as a “controlling employer” for a safety violation.

Raam thereafter contested this citation before an administrative law judge (ALJ) of the Appeals Board. (§ 6319.)

After the ALJ issued a decision upholding the citation, Raam filed a timely petition for reconsideration with the Appeals Board. On March 4, 2016, the Appeals Board issued a decision denying Raam’s petition for reconsideration. On the same day (March 4), the Appeals Board filed this decision and served a copy on Raam via first class mail.

On April 8, 2016, 35 days after the Appeals Board’s denial was issued, filed and served, Raam filed a petition for writ of mandate with the Alameda County Superior Court. Both the Appeals Board and DOSH, as real party in interest, challenged Raam’s petition for writ of mandate on untimeliness grounds, the former by motion to dismiss and the latter by demurrer. After a contested hearing presided over by Commissioner Thomas Rasch, the demurrer was sustained and the motion to dismiss granted, without leave to amend. The Court of Appeal affirmed the dismissal in the unpublished case of Raam Construction v. Occupational Safety and Health Appeals Board.

Section 6627 states in relevant part: “Any person affected by an order or decision of the appeals board may, within the time limit specified in this section, apply to the superior court of the county in which he resides, for a writ of mandate, for the purpose of inquiring into and determining the lawfulness of the original order or decision or of the order or decision following reconsideration. The application for writ of mandate must be made within 30 days after a petition for reconsideration is denied, or, if a petition is granted or reconsideration is had on the appeals board’s own motion, within 30 days after the filing of the order or decision following reconsideration.” (Italics added.)

“The California Supreme Court has interpreted another Labor Code provision that is in all significant respects identical to section 6627. In Camper v. Workers’ Comp. Appeals Bd. (1992) 3 Cal.4th 679 (Camper), the high court was asked to interpret section 5950, the statute governing the time limits for an aggrieved party to file a petition for review of a Workers’ Compensation Appeals Board decision before the Supreme Court or an appellate court. It concluding section 5950 is clear on its face that the filing of the Appeals Board’s decision is what triggers the running of the limitations period:  “The 45-day time period specified in section 5950 runs from the time ‘a petition for review is denied’ or from the ‘filing of [a]n order, decision, or award following reconsideration.’  (Lab. Code, § 5950, italics added.)  There is no reference in this statute to service.  The operative trigger of the time period set forth in section 5950 is the filing of the order.  

The Division of Workers’ Compensation has adopted amendments to the Official Medical Fee Schedule (OMFS) for Physician and Non-Physician Practitioner Services (California Code of Regulations, title 8, section 9789.12.1 through 9789.19.1) to replace the average statewide geographic adjustment factor with local geographic adjustment factors as of January 1.

The locality-specific geographic adjustment factors, known as the Geographic Practice Cost Index (GPCI), was implemented by Medicare in January 2017 as part of its Metropolitan Statistical Area (MSA) program. Geographic Practice Cost Index is used along with Relative Value Units by Medicare to determine allowable payment amounts for medical procedures.

Fee-for-service Medicare payments to physicians and certain other licensed clinical practitioners (including nurse practitioners, physician assistants, clinical nurse specialists, and occupational and physical therapists) are adjusted for geographic differences in market conditions and business costs. These geographic adjustments are intended to ensure that payment to providers reflects the local costs of providing care, so that the Medicare program does not overpay in certain areas and underpay in others.

Each of the three components of the Medicare Physician Fee Schedule (PFS) – physician work, practice expense (PE), and malpractice (MP) insurance – is adjusted for differences across geographic areas in the input prices related to each component. When they are combined, these three components are known as the geographic adjustment factor (GAF).1

The GPCI payment adjustments are made for 89 different geographic areas in the United States, also known as payment areas (or localities). Some are defined according to metropolitan areas, but there are 34 statewide payment areas that include both metropolitan and nonmetropolitan areas.

By federal statute, any changes to the GPCIs that do not explicitly receive additional funding must be budget neutral. In practice, budget neutrality requires that the total amount of payment be unaffected by new adjustments, so that any adjustment upward for one payment area must be paid for by a downward adjustment for other areas. This requirement creates significant tensions among providers in high-versus low-cost areas.

Another major source of disagreement is whether the geographic adjusters should be used as policy levers to help influence provider supply, particularly in nonmetropolitan areas. Some rural health policy experts and practitioners argue that because earning potential influences physicians’ decisions on where to practice, and because many private payers use Medicare prices as a basis for setting their own rates, the geographic adjustments should be used as policy tools to encourage physicians to practice in nonmetropolitan areas.

The DWC says that adoption of the Medicare MSA-based locality GPCIs will improve payment allowance accuracy by reflecting the resources required to provide a service according to specific regions.

The amendments also make minor clarifying revisions to the regulations.

DWC submitted a request to the California Office of Administrative Law to file the amended regulations with the Secretary of State and have them published in the California Code of Regulations. The regulations can be found on the DWC website.

Insurance Commissioner Dave Jones has approved a Universal Claims Certification (UCC) program from Claims and Litigation Management Alliance (CLM) designed to streamline the licensing process for independent insurance adjusters.

The UCC makes the process of licensing independent insurance adjusters who wish to acquire and manage their independent insurance adjuster licenses in multiple states more efficient. The UCC does not replace an independent insurance adjuster license, but makes the process of securing a license more efficient. Both licensed and unlicensed individuals can acquire a UCC. However, unlicensed individuals must first go through an intensive training by completing a 40-hour online pre-certification education program and successfully pass an examination to earn the UCC.

Insurance Commissioner Dave Jones said “The Universal Claims Certification process is designed to streamline the independent insurance adjuster licensing process and reduce costs. Also, the UCC program sets requirements for licensees that exceed the requirements under current California law, meaning it requires licensees to complete more continuing education, which greatly benefits the independent insurance adjusters and consumers.”

Currently, independent insurance adjuster applicants are not required to complete any prelicensing education. California’s applicants are only required to take and pass the independent insurance adjuster license examination and meet the license requirements to receive an independent insurance adjuster license.

For a licensee to maintain the UCC, the independent insurance adjusters must complete 24 hours of continuing education every two years including five hours of insurance law and ethics. The UCC program’s insurance law and ethics requirement exceeds California’s required three hours of law and ethics that is a part of and not in addition to the 24-hour continuing education requirement.

Once independent insurance adjusters acquire the UCC, they will be able to more quickly obtain a license in the states where the UCC is currently approved, including Alabama, Florida, Georgia, Mississippi, Texas, and now California. This will allow out-of-state adjusters to be more readily available when a natural disaster occurs.

“For years, the CLM membership has complained of the tedious state-by-state adjuster licensing process. We first worked to tackle the process of managing multiple licenses with our Tracker product, then we started to work with various states to actually change the licensing process,” says CLM Founder and former CEO Adam Potter. “It’s exciting to see this work come to life as we launch the UCC.”

CLM is an insurance industry association with more than 45,000 members that focuses on education and resources. CLM offers over 300 live courses, events and conferences annually.

A WCJ found Dean Fitzpatrick “100 percent permanently totally disabled” as a result of injury to his heart and psyche sustained during the course of his employment as a correctional officer. The award was based on the reports of two doctors regarding Fitzpatrick’s injury — Peter Chang-Sing for his heart and Richard Lieberman for his psyche.

Chang-Sing rated Fitzpatrick’s WPI for his heart at 75 percent and his resulting permanent disability at 97 percent. Lieberman rated Fitzpatrick’s GAF score at 45, resulting in 40 percent WPI, and permanent disability of 71 percent for his psyche. It is undisputed that, combining the 97 percent and 71 percent ratings under the Combined Values Chart Fitzpatrick’s permanent disability scheduled rating is 99 percent — permanent partial disability.

Thus Fitzpatrick’s permanent disability scheduled rating is 99 percent — permanent partial disability.

In the July 16, 2015 report, Dr. Lieberman felt that applicant was”on strict psychiatric grounds totally and permanently disabled” . . . Dr. Lieberman elaborated further: “I am dubious that this patient will return to work in any capacity.”

The ALJ concluded: “Based upon [Fitzpatrick’s] credible testimony, the medical reports of Dr. Chang-Sing and Dr. Lieberman, and in accordance with the facts (see Labor Code §4662(b)), it is found that applicant is permanently totally disabled.” The administrative law judge did not mention or discuss the combined rating under the 2005 Schedule. No vocational expert presented evidence in the case.

The Board affirmed the Decision in its opinion and order denying the petition for reconsideration. However, the Court of Appeal reversed in the published case of Department of Corrections v WCAB (Dean Fitzpatrick).

The question presented on appeal is whether the Board correctly interpreted and applied sections 4660 and 4662, subdivision (b).

“We easily harmonize sections 4660 and 4662, subdivision (b). Section 4662, subdivision (b), provides that, in nonconclusively presumed permanent total disability cases (i.e., those cases not enumerated in section 4662, subdivision (a)), permanent total disability may be found ‘in accordance with the fact.’ This section does not, however, address how such a determination shall be made; read plainly, it merely provides that a determination of permanent total disability shall be made on the facts of the case.”

Section 4660 addresses how the determination on the facts shall be made in each case for injuries occurring before January 1, 2013. Indeed, section 4660 expressly applies to the determination of “the percentages of permanent disability.” A “final permanent disability rating” is obtained by going through the steps outlined in the 2005 Schedule.

“Our interpretation of sections 4660 and 4662, subdivision (b), is squarely at odds with the Board panel’s interpretation of those statutes in Jaramillo (on which the administrative law judge and the Board relied in this case).” [Coca-Cola Enterprises, Inc. v. Workers’ Comp. Appeals Bd. (Jaramillo) (2012) 77 Cal.Comp.Cases 445 [writ. den.].

“We thus disapprove of Jaramillo with respect to its analysis on this issue, and annul the Board’s Opinion for the same reason.”