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Tag: 2017 News

Updated MTUS Treatment Guideline Effective December 1

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 updates, effective for medical treatment services rendered on or after December 1, 2017, incorporate by reference the American College of Occupational and Environmental Medicine’s (ACOEM’s) most recent treatment guidelines to the General Approaches, Clinical Topics, 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, thirty days to prepare before these evidence-based updates become effective,” said George Parisotto, DWC Administrative Director.

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

Initial Approaches to Treatment Guideline (ACOEM June 30, 2017)
Opioids Guideline (ACOEM April 20, 2017)
Chronic Pain Guideline (ACOEM May 15, 2017)
Ankle and Foot Disorders Guideline (ACOEM September 2015)
Occupational/Work-Related Asthma Medical Treatment Guideline (ACOEM January 4, 2016)
Low Back Disorders Guideline (ACOEM February 24, 2016)
Cervical and Thoracic Spine Disorders Guideline (ACOEM May 27, 2016)
Elbow Disorders Guideline (ACOEM 2013)
Eye Disorders Guideline (ACOEM April 1, 2017)
Hand, Wrist, and Forearm Disorders Guideline (ACOEM June 30, 2016)
Hip and Groin Guideline (ACOEM May 1, 2011)
Knee Disorders Guideline (ACOEM October 28, 2015)
Occupational Interstitial Lung Disease Guideline (ACOEM January 4, 2016)
Shoulder Disorders Guideline (ACOEM August 1, 2016)

“DWC has incorporated the most recent ACOEM guidelines to ensure the guidelines in 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:

1) Addendum one shows the regulatory amendments directly related to the evidence-based updates to the MTUS.
2) 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.

Cooled Radiofrequency Ablation (CRFA) Helps Knee Pain

A new study published in Regional Anesthesia & Pain Medicine, concluded that a minimally invasive procedure called cooled radiofrequency ablation (CRFA) provides better pain reduction and functional improvement compared to steroid injection for patients with osteoarthritis of the knee.

“This study demonstrates that CRFA is an effective long-term therapeutic option for managing pain, and improving physical function and quality of life, for patients suffering from painful knee osteoarthritis when compared with intra-articular steroid injection,” according to the clinical trial report by Leonardo Kapural, MD, PhD, of the Center for Clinical Research, Winston-Salem, N.C., and colleagues.

According to a report in Science Daily, knee osteoarthritis is a common and painful condition in older adults. Knee replacement surgery is an established option for patients with advanced osteoarthritis, but is not appropriate for all patients because of age or health status. Even patients who have knee replacement may have ongoing pain, despite a mechanically satisfactory prosthesis. Intra-articular (within the joint) steroid injection is commonly performed, but provides only short-term pain relief. In addition, steroids may have adverse effects on cartilage over time

Dr. Kapural and colleagues evaluated CRFA as an alternative to steroid injection in 151 patients with chronic pain from knee osteoarthritis. The patients had had knee pain for an average of about ten years, with many previous treatments. They were randomly assigned to undergo CRFA or steroid injection.

The noninvasive CRFA procedure uses radiofrequency energy to interrupt pain transmission by a specific nerve (genicular nerve) of the knee. Before the procedure, a local anesthetic nerve block is performed to confirm that numbing the genicular nerve reduces the patient’s knee pain. Cooled radiofrequency ablation is performed on an outpatient basis, with local anesthesia and minimal sedation.

Patients undergoing CRFA had significant and lasting reduction in pain scores. From an initial pain score of about 7 on a 10-point scale, pain ratings at one month were about 3 in the CRFA group versus 4 in the steroid group.

With further follow-up, pain scores remained lower in the CRFA group while increasing toward the pre-treatment level in the steroid group. At six months, 74 percent of patients assigned to CRFA had at least a one-half reduction in pain scores, compared to 16 percent of those undergoing steroid injection.

Forty percent of patients in the CRFA group rated their knee function “satisfactory” at six months’ follow-up, compared to just three percent of the steroid group. Ninety-one percent of the CRFA group felt their overall health had improved, compared to 24 percent in the steroid group.

Patients undergoing CRFA had greater reduction in the use of conventional, non-opioid pain medications. There was no significant difference in opioids, which were used by a minority of patients in both groups. There were no serious treatment-related adverse events in either group.

The results suggest that CRFA provides “clinically meaningful” pain reduction and functional improvement in patients with knee OA, with better and longer-lasting improvement than steroid injection. Dr. Kapural and colleagues plan longer follow-up to assess outcomes at one year and beyond. They note that pain may return as the treated nerve regenerates; if so, repeating the CRFA procedure is a “reasonable and sensible” option.

The authors note some limitations of their study, including the fact that the results weren’t assessed in “blinded” fashion. They also suggest more focused studies to see if CRFA can reduce the need for opioid pain medications. Dr. Kapural and coauthors conclude, “Nonetheless, the findings of this study indicate that CRFA for genicular nerve ablation is superior to a single corticosteroid injection in osteoarthritic subjects for management of knee pain.”

Counties and Cities to Consolidate 66 Opioid Lawsuits

An attorney representing a majority of 66 counties and cities nationwide that have lawsuits filed against opioid distributors accused of fueling a national drug epidemic has requested the cases be consolidated into a multidistrict litigation and heard before one judge.

The Herald Dispatch reports that a motion filed Sept. 25 with the U.S. Judicial Panel on Multidistrict Litigation, Attorney James C. Peterson said all 66 cases filed in 11 districts nationwide make similar claims, and consolidation would create better cohesion and efficiency as the cases move forward against the “Big Three” distributors – McKesson Corp., Cardinal Health and AmerisourceBergen Drug Corp. Peterson’s firm represents clients in 46 of those cases.

Various pill manufacturers are also named in various lawsuits, including Purdue, Teva/Cephalon, Janssen, Endo, Actavis and Mallinckrodt.

The original allegations made by Huntington at the beginning of 2017 started a rippling effect of cases being filed across the nation. Currently, lawsuits are pending in federal courts in West Virginia, Illinois, Alabama, California, Kentucky, Ohio, New Hampshire, Tennessee and Washington.

The cities and counties allege drug firms breached their duty to monitor, detect, investigate, refuse and report suspicious orders of prescription opiates coming into the states over the past several years – a duty the lawsuits claim companies have under the Controlled Substances Act of 1970. The 66 lawsuits claim the businesses were negligent in creating a public nuisance and participated in corrupt practices, Peterson said.

“The economic burden of prescription opioid misuse alone is $78.5 billion a year, including the costs of health care, lost productivity, addiction treatment and criminal justice expenditures.” Paul T. Farrell Jr., who represents several counties throughout the country, said the companies had paid millions in fines and had licenses suspended for similar allegations.

Peterson wrote that the federal government has recently fined McKesson a record $150 million for failure to report suspicious orders and Cardinal Health was fined $44 million for similar allegations.

Peterson also pointed to Purdue’s agreement to pay approximately $600 million in fines in 2007 for deceptive marketing regarding the addictive nature of OxyContin.

Peterson argued the best location for the cases to be heard would be Ohio because of its central and easily accessible location, underutilized court system and because it is one of the hardest hit areas represented in all the lawsuits. He also wrote the Big Three each maintains facilities or is headquartered in the state. Illinois would also be satisfactory, he wrote.

“As this national calamity continues to unfold, the federal judiciary should respond with a cohesive and efficient judicial methodology, rather than risking inconsistent decisions on pre-trial issues and duplication of efforts in different federal courts,” he said.

Orange County Lab Owner Sentenced to 8 Years

A former resident of Aliso Viejo who submitted fraudulent bills to insurance companies that sought well over $8 million for tests and services that were never performed was just sentenced to 97 months in federal prison.

Michael Mirando, 40, who currently resides in Portland, Oregon, was sentenced by United States District Judge Percy Anderson, who also ordered Mirando to pay just over $3 million in restitution. At the conclusion of the hearing, Judge Anderson – who called the defendant “totally unrepentant” – remanded Mirando into custody.

Following a one-week trial, Mirando was found guilty in May of 15 counts of health care fraud. The federal jury deliberated for less than 30 minutes before issuing its verdicts.

The evidence presented during the trial showed that Mirando – who was an owner of Holter Labs, LLC, which provided cardiac monitoring services using an ambulatory electrocardiography device known as a Holter recorder – defrauded dozens of private insurance companies by submitting millions of dollars in claims for services that were never performed.

Mirando handled most of Holter Lab’s business activities, including purchasing the Holter recorders, advertising, managing the company’s finances, and submitting the medical claims to the patients’ insurance companies. Holter Labs was based in Laguna Niguel until Mirando moved the company to Portland in 2012.

Holter Labs provided the Holter recorder to physicians, who prescribed the devices to monitor patients’ heart rates for one to two days. Mirando then billed the patients’ insurance companies for the prescribed 24- or 48-hour tests, but he also submitted bills for services never ordered – such as 30-day tests – and for services the device could not perform – such as brain scans and oxygen studies.

From 2005 through 2016, Mirando submitted tens of thousands of claims to health insurance companies, some of which were for services legitimately performed. But Mirando also submitted bills “for services that doctors never ordered, patients never received, and that the Holter devices never performed and, in many cases, were incapable of performing,” according to documents filed by prosecutors.

The bills submitted to 26 health insurance companies sought approximately $10.3 million, which included approximately $8.4 million for tests that his company’s heart rate monitors never performed and were unable to perform. The victim health insurance companies paid about $3 million on these fraudulent claims.

After Mirando admitted that he purchased his house in Portland with proceeds generated by the fraud scheme, Judge Anderson recently signed a preliminary order of forfeiture for that residence.

The case against Mirando was investigated by the Federal Bureau of Investigation. The case was prosecuted by Assistant United States Attorneys Michael G. Freedman and Katherine A. Rykken of the General Crimes Section.

New Law Proposed for Peace Officer Vegas Shooting Victims

In response to Southern California police officers being denied injury benefits for wounds they sustained in the Las Vegas mass-shooting, an Anaheim state assemblyman is proposing legislation to require compensation for officers hurt off duty while responding to out-of-state crimes.

The Orange County Register reports that Assemblyman Tom Daly, D-Anaheim, plans to introduce legislation “to eliminate any ambiguity in the law” after Orange County rejected workers’ compensation claims last week from four of its deputies injured in the Las Vegas shooting.

Daly believes California law already requires cities and counties to pay those benefits. But Orange County counsel Leon Page believes the state’s labor code clearly forbids benefit payments for injuries off-duty officers sustain outside California, while officials in Los Angeles County say state law is vague on the issue.

If Daly’s idea becomes law, it could put taxpayers on the hook for additional bills for long-term medical care and disability payments.

More than 200 California police officers were attending a country music show on Oct. 1 when Stephen Paddock fired into the festival crowd, killing 58 people and wounding more than 500.

During the shooting, many of those officers shifted to police mode even though they were in Las Vegas, helping people to safety, performing CPR and assisting local authorities who were trying to secure the area. Some California officers were shot while responding, and others say they have developed PTSD from the incident.

Since then, jurisdictions that employ those injured officers, including Los Angeles, Riverside, San Bernardino and Orange counties, have faced questions about whether they are required or even allowed to pay for the long-term medical treatment, time off, and other benefits that might come to some officers if they’re issued worker’s compensation.

The state’s labor code is clear that police officers are owed workers’ compensation benefits if they intervene in a crime anywhere in California while off duty and become injured. Daly’s bill, which he could introduce before the end of the year, will ask the legislature to clarify that the existing law also covers out-of-state, off-duty incidents.

Orange County Supervisor Todd Spitzer believes Daly’s legislation could apply retroactively to help the officers injured in Las Vegas if the bill seeks only to clarify the intent of the current law rather than to change it or create a new law.

Los Angeles County is considering whether to grant or deny claims by two sheriff’s deputies shot at the festival, and a county official said he expects the issue to result in litigation. In San Bernardino County, which employs 11 deputies who attended the festival, including Sgt. Brad Powers, who was shot in the leg in Las Vegas, the deputies’ union has initiated talks with the sheriff’s department to advocate that Powers be treated as an on-duty injury.

The Orange County Board of Supervisors is scheduled to consider a resolution toward creating a policy to provide paid time off for off-duty employees who are wounded while trying to save lives in out-of-state “mass casualty” events. Dominguez said the sheriff’s union remains concerned that the plan wouldn’t cover the long-term medical care.

45 States Sue 18 Drug Companies for Price Fixing

A large group of U.S. states accused key players in the generic drug industry of a broad price-fixing conspiracy, moving on to widen an earlier lawsuit to add many more drugmakers and medicines.

According to the Reuters Health report, the lawsuit, brought by the attorneys general of 45 states and the District of Columbia, accused 18 companies and subsidiaries and named 15 medicines. It also targeted two individual executives: Rajiv Malik, president and executive director of Mylan NV, and Satish Mehta, CEO and managing director of India’s Emcure Pharmaceuticals.

The states said the drugmakers and executives divided customers for their drugs among themselves, agreeing that each company would have a certain percentage of the market. The companies sometimes agreed on price increases in advance, the states added.

The states said Malik and Mehta spoke directly to one another to agree on their companies’ shares of the market for a delayed-release version of a common antibiotic, doxycycline hyclate.

“It is our belief that price-fixing is systematic, it is pervasive, and that a culture of collusion exists in the industry,” Connecticut Attorney General George Jepsen, who is leading the case, told a news conference in Hartford.

Mylan said in a statement it had found no evidence of price-fixing by the company or any of its employees, and vowed to defend itself vigorously. Malik, the company’s second-ranking official, has received more than $50 million in compensation over the past three years, last year making more than CEO Heather Bresch. “Mylan has deep faith in the integrity of its president, Rajiv Malik, and stands behind him fully,” the company said.

Two former executives of Emcure’s subsidiary Heritage Pharmaceuticals pleaded guilty in January to federal charges of conspiring to fix prices and divide up the market for doxycycline and the diabetes drug glyburide. The two men, former Heritage president Jason Malek and former chairman and chief executive Jeffrey Glazer, reached a deal with 41 states and territories in which they each agreed to pay $25,000 and cooperate with the state probe.

The original complaint, filed in December, targeted Mylan, Heritage, Aurobindo Pharma USA Inc, Citron Pharma LLC, Mayne Pharma USA Inc and Teva Pharmaceuticals USA Inc.

The states are pressing a new complaint that would add Novartis AG’s unit Sandoz, India-based Sun Pharmaceutical Industries Ltd, Endo International PLC’s unit Par Pharmaceutical, Dr. Reddy’s Laboratories, Apotex Corp, Glenmark Generics Ltd, Lannett Company Inc, Alkem Laboratories Ltd’s unit Ascend Laboratories and Cadila Healthcare Ltd’s unit Zydus Pharmaceuticals Inc.

Teva spokeswoman Denise Bradley said the company denied the allegations. Endo spokeswoman Heather Lubeski said the company would vigorously defend itself against the claims. Other companies did not immediately respond to requests for comment.

The original lawsuit centered on just two medicines, delayed-release doxycycline and glyburide. The price of doxycycline rose from $20 for 500 tablets to $1,849 between October 2013 and May 2014, according to U.S. Senator Amy Klobuchar, a Minnesota Democrat who had been pressing for action on high drug prices.The amended complaint would expand the number of drugs to include glipizide-metformin and glyburide-metformin, which are among the most commonly used diabetes treatments.

Others include: acetazolamide, which is used to treat glaucoma and epilepsy; the antibiotic doxycycline monohydrate; the blood pressure medicine fosinopril; the anti-anxiety medicine meprobamate; and the calcium channel blocking agent nimodipine.

Billionaire Drugmaker Arrested in Fentanyl Kickback Case

The billionaire founder of Insys Therapeutics Inc, John Kapoor, has resigned from the company’s board of directors, Insys said in a statement on Sunday after he was arrested on Thursday on charges he participated in a scheme to bribe doctors to prescribe a fentanyl-based cancer pain drug, marking a step by authorities to fight the opioid epidemic.

The founder and majority owner of Insys Therapeutics Inc., was arrested and charged with leading a nationwide conspiracy to profit by using bribes and fraud to cause the illegal distribution of a Fentanyl spray intended for cancer patients experiencing breakthrough pain.

John N. Kapoor, 74, of Phoenix, Ariz., a former member of the Board of Directors of Insys, was arrested in Arizona and charged with RICO conspiracy, as well as other felonies, including conspiracy to commit mail and wire fraud and conspiracy to violate the Anti-Kickback Law.

The superseding indictment also includes additional allegations against several former Insys executives and managers who were initially indicted in December 2016.

The superseding indictment charges that Kapoor and other company officials conspired to bribe practitioners in various states, many of whom operated pain clinics, in order to get them to prescribe a fentanyl-based pain medication.

The medication, called “Subsys,” is a powerful narcotic intended to treat cancer patients suffering intense breakthrough pain. Prosecutors allege that the practitioners wrote large numbers of prescriptions for the patients, most of whom were not diagnosed with cancer, In exchange for bribes and kickbacks,

The indictment also alleges that Kapoor and the six former executives conspired to mislead and defraud health insurance providers who were reluctant to approve payment for the drug when it was prescribed for non-cancer patients. They achieved this goal by setting up the “reimbursement unit,” which was dedicated to obtaining prior authorization directly from insurers and pharmacy benefit managers.

“As alleged, these executives created a corporate culture at Insys that utilized deception and bribery as an acceptable business practice, deceiving patients, and conspiring with doctors and insurers,” said Harold H. Shaw, Special Agent in Charge of the Federal Bureau of Investigation, Boston Field Division.

The charges of conspiracy to commit RICO and conspiracy to commit mail and wire fraud each provide for a sentence of no greater than 20 years in prison, three years of supervised release and a fine of $250,000, or twice the amount of pecuniary gain or loss.  The charges of conspiracy to violate the Anti-Kickback Law provide for a sentence of no greater than five years in prison, three years of supervised release and a $25,000 fine. Sentences are imposed by a federal district court judge based upon the U.S. Sentencing Guidelines and other statutory factors.

Aetna Considers Merger with CVS Health

The proposed merger between U.S. pharmacy operator CVS Health Corp and No. 3 health insurer Aetna Inc represents a $66 billion bet that insurers can drive down high U.S. drug prices by cutting out the middleman.

The move is the most expensive effort to date that would enable a national health insurer to take back full control of prescription medicines for their customers by negotiating prices with pharmaceutical manufacturers and setting customer out-of-pocket costs for each drug.

Reuters Health reports that CVS, one of the largest U.S. pharmacy benefits managers, has offered to buy No. 3 health insurer Aetna for more than $200 per share. It could take at least several weeks for any deal to materialize.

If the deal happens, it would likely pressure rival insurers, drugmakers, pharmaceutical benefits managers, and retail pharmacies to also consider mergers or switching partners to try to keep up with the potential healthcare cost savings or increase in profit margins.

“It’s an alternate model at this point. It’s not clear that it’s definitely a better one,” BMO Capital Markets analyst Matt Borsch said. “More consolidation could lead to pressure on some of the brand-name drug prices and a better counterweight to the big pharma companies.”

For years, insurers paid drug benefits managers like CVS and Express Scripts Holdings Co to negotiate down drug prices, with both parties taking a share of any discount by the time a medicine was paid for by consumers.

But outrage over the high costs of drugs has grown as consumers have picked up a larger portion of the tab for drug costs and it is threatening profit margins all along the drug supply chain, from manufacturers to distributors, insurers and pharmacies.

UnitedHealth Group Inc and Humana Inc currently have in-house pharmacy benefits businesses, and say that it has helped them keep medical costs down.

Anthem Inc recently decided to go down that same path. It cut ties with Express Scripts during a $3 billion legal fight, and said it would use CVS to build its own pharmacy benefits business in the next few years. That tie-up could now be at risk if CVS reaches a deal to buy Aetna.

CVS also provides management services for Aetna rival Cigna Corp. If CVS buys Aetna, that could revive Cigna’s interest in buying Humana, analyst Christine Arnold of investment bank Cowen & Co said in a research note.

Aetna earlier this year closed the door on a deal with rival insurer Humana Inc after antitrust regulators said that combination and a rival deal between Anthem Inc and Cigna Corp were anti-competitive.

Over the past decade, health insurers have diverged on the value of the pharmacy benefits business.

Anthem sold its pharmacy benefit manager to Express Scripts and outsourced almost all of the business in 2010.

UnitedHealth took the opposite approach when it decided in 2011 to bring its pharmacy benefits management in house, then bought an even bigger standalone benefits manager, Catamaran, in 2015.

Humana operates its own pharmacy benefit manager and Cigna and Aetna have hybrid approaches where they manage some parts in house and outsource others.  

Another potential lure of a deal for Aetna would be to capitalize on the growing number of simple health services offered in a CVS store, from flu shots to blood pressure checks. Reimbursing such patient care outside of a doctor’s office or hospital could cut healthcare costs, Gupta said.

CDI Lowers Advisory Comp Rates by 17.1%

Insurance Commissioner Dave Jones adopted and issued a revised advisory pure premium rate, lowering the benchmark to $1.94 per $100 of payroll for workers’ compensation insurance, effective January 1, 2018.

This is 17.1 percent less than the average pure premium rate of $2.34 California insurers filed as of July 1, 2017.

This decision results in an advisory pure premium rate that is slightly below the $1.96 average rate recommended by the Workers’ Compensation Insurance Rating Bureau (WCIRB) in its filing. Jones issued the advisory pure premium rate three weeks after a public hearing and careful review of the testimony and evidence submitted.

His adoption is only advisory, as the commissioner has no rate authority over workers’ compensation insurers.

“The continued decreases in costs to insurers should be passed along to employers through lower rates,” said Insurance Commissioner Dave Jones. “Workers’ compensation reform legislation should require that system cost savings be passed onto employers in the form of lower rates– the law does not require this currently.”

The WCIRB’s pure premium advisory rate filing demonstrated continued decreases in costs in California’s workers’ compensation insurance market.

The pure premium advisory rate reduction is based on insurers’ cost data through June 30 of this year. Insurers’ net costs in the workers’ compensation system continue to decline as a result of SB 863, SB 1160, and AB 1244 enacted by the Legislature and Governor Brown.

The WCIRB notes continued favorable medical loss development including acceleration in claim settlement.

The WCIRB will evaluate workers’ compensation insurance costs again in the summer and fall of next year when it files its pure premium rate benchmark recommendation with the Department of Insurance. That filing will provide an opportunity to assess whether medical costs continue to be lower and what changes, if any, there are in other costs in the system.

The purpose of the pure premium benchmark rate process is to review costs in the workers’ compensation insurance system and to confirm that rates filed by insurance companies are adequate to cover benefits for injured workers.

Suspended Provider List Grows to 52 Vendors

The Division of Workers’ Compensation (DWC) has suspended three more medical providers from participating in California’s workers’ compensation system, bringing the total number of providers suspended this year to 52.

DWC Administrative Director George Parisotto issued Orders of Suspension against the following providers:

1) Byong Chun “David” Min of Irvine pled guilty on April 20, 2016 to health care fraud and illegal kickbacks. Min, co-owner and operator of Glory Rehab Team, Inc., which also operated as Dream Hospital and Daesung Clinic in Orange County, was involved in an illegal kickback scheme referring Medicare beneficiaries to co-schemers Marlon Songco, Joseff Sales and Danniel Goyena, knowing that they would bill Medicare for services that were never provided.

2) Sujan Thyagaraj of Roswell, New Mexico, a physician whose medical license was summarily suspended in New Mexico in March 2016 after criminal charges were filed against him for sexual assault on a patient. The Medical Board of California revoked his physician and surgeon’s license on September 23, 2016. Thyagaraj was suspended from the Medi-Cal program on August 29, 2017.

3) Rhonda Singleton of Los Angeles, owner of substance abuse treatment facility Singleton Housing Project, pled no contest in Los Angeles County Superior Court on January 25, 2017 to grand theft of the California Health Care Deposit Fund. Singleton was suspended from Medi-Cal on August 15, 2017.

AB 1244 (Gray and Daly), which went into effect January 1, introduced new changes to the workers’ compensation system and requires the division’s Administrative Director to suspend any medical provider, physician or practitioner from participating in the workers’ compensation system under certain circumstances.