California: A Look at the Distinct Roles of Evaluating Physicians

By Hon. Susan V. Hamilton, Former Assistant Secretary and Deputy Commissioner, California Workers’ Compensation Appeals Board

The medically related intricacies of a California workers’ compensation case are varied and often confusing. Acronyms abound. They include agreed medical evaluator (AME) and qualified medical evaluator (QME), medical provider network (MPN), primary treating physician (PTP) as well as secondary PTP, utilization review (UR), and independent medical review (IMR). A host of statutes and regulations govern the specific process for addressing such issues as whether a claimed injury arose out of and occurred in the course of employment, or an injured workers’ entitlement to medical treatment. All too often practitioners find themselves perplexed by the appropriate course of action required to address a particular medical issue. Can the issue be addressed by an AME/QME or the PTP? Or is another process called for? A recent panel decision explains the distinct roles of the AME/QME and the IMR physician within the MPN. The case is Serrano v. Nova Commercial Company, Inc. (April 11, 2024, ADJ10746901).

The Facts

Ruth Serrano (applicant) claimed an injury to her lumbar spine, left hip and left leg while employed as a custodian by defendant. Defendant accepted the claim and applicant received treatment through defendant’s MPN. That treatment included treatment for pain in the left (injured) hip. Subsequently applicant was evaluated by QME, Dr. Roland. During the evaluation, Dr. Roland diagnosed a soft tissue mass at the anterolateral hip and recommended immediate biopsy for diagnostic purposes to rule out cancer versus residual post-traumatic injury cite.

After Dr. Roland’s evaluation, applicant objected to the medical treatment and diagnoses she had received from MPN physician, Dr. Maldoon. She requested a second opinion evaluation from another physician within defendant’s MPN. Applicant was then seen by Dr. Kelly, who performed a “second opinion” evaluation regarding applicant’s left hip under Labor Code § 4616.3(c). Applicant disputed Dr. Kelly’s second opinion evaluation and requested a “third opinion” evaluation also under the provisions of Labor Code § 4616.3(c). Dr. Cramer performed the third opinion evaluation, with which applicant did not agree. Applicant then requested an MPN IMR as provided for in Labor Code § 4616.4(b).

Dr. Smith served as the MPN IMR physician. He conducted an evaluation specifically to address the left hip mass and appropriate treatment in accordance with the Medical Treatment Utilization Schedule (MTUS). Dr. Smith diagnosed a left hip mass, identified it as probable non-industrial lipoma, and recommended excision of the mass by an orthopedic oncologist on a non-industrial basis. The Administrative Director (AD) of DWC adopted Dr. Smith’s IMR.

Although the parties agreed that applicant sustained industrial injury to her lumbar spine, left hip and left leg, they remained in disagreement over the recommended excision of the left hip mass and defendant’s liability for the procedure. A trial was then held on the following issues: (1) whether Dr. Smith’s MPN IMR report could be sent to QME Dr. Roland; (2) whether Dr. Smith (the MPN IMR physician) could address the need for excision of the left hip mass on an industrial basis; and (3) whether the recommendation for excision of the left hip mass as adopted by the AD could be ordered by the WCAB.

Following the trial, the WCJ issued a Findings and Order (F&O) in which she found that while applicant may need the left hip mass excision for further diagnostic purposes, Dr. Smith, the MPN IMR physician, cannot address the issue of causation of applicant’s left hip mass. Instead, Dr. Smith’s report would be sent to QME Dr. Roland for review and consideration since the issue of causation of the left hip mass was a matter within the purview of Dr. Roland.

Applicant sought reconsideration or removal of the WCJ’s decision. She claimed that the WCAB should order enforcement of Dr. Smith’s recommendation for surgical excision of the left hip mass as medically necessary since that recommendation was adopted by the AD. Applicant urged the WCAB to grant removal, contending that she was significantly prejudiced by and would suffer irreparable harm if the WCJ’s decision was allowed to stand because it delayed her right to excision of a potentially cancerous mass on her industrially injured left hip. She also argued that Dr. Smith’s report should not be sent to or reviewed by QME Dr. Roland, and that Dr. Roland should not be allowed to address causation of applicant’s left hip mass.

The Panels Analysis:

Not surprisingly, the panel begins its analysis with a review of Labor Code § 4616.4, which specifically applies to treatment disputes when the injured employee receives medical treatment within an employer’s MPN. Subsection (b) of that statute provides that if there is still a dispute over treatment after the third physician issues an opinion, the injured employee may request an MPN IMR. The MPN IMR must be performed by a licensed physician of appropriate specialty who is selected by the AD or the IMR organization.

The MPN IMR physician must be provided with relevant treatment reports/records and is required to conduct a physical examination of the injured employee. If the MPN IMR physician determines that diagnostic tests are necessary, such testing must be authorized. Then the MPN IMR physician must decide if the disputed treatment is consistent with the MTUS. If the MPN IMR physician determines that the disputed treatment is consistent with the MTUS and necessary based on the specific facts, defendant is liable for the cost of such treatment. The MPN IMR physician’s determination is provided to the AD, who is required to adopt promptly the determination and issue a decision.

In its application of Labor Code § 4616.4(b) to the facts in this case, the panel observes that the MPN IMR physician addressed both the medical appropriateness of the disputed treatment as well as industrial causation of applicant’s left hip mass. In this regard, Dr. Smith exceeded the limited role of the MPN IMR physician as set forth in the statute. The panel cites Simmons v. State of California, Department of Mental Health (Simmons) (2005) 70 Cal. Comp. Cases 866 (Appeals Board en banc decision) as authority. In Simmons, supra, the Appeals Board held that when a defendant undertakes UR to determine the medical necessity of a specific treatment recommendation, the role of the UR physician is to determine whether the treatment is medically necessary. If, in addition, the UR physician questions whether the need for that treatment is causally related to the industrial injury, the UR physician has exceeded their authority. That is, the UR physician’s role is limited to the issue of whether the disputed treatment is medically necessary.

While Simmons addresses the mandatory UR process within Labor Code § 4610, its holding regarding the limited role of the UR physician is equally applicable to the MPN IMR physician who performs an analogous role concerning treatment disputes within the MPN.

The panel concludes that Dr. Smith’s opinion that applicant’s left hip mass is non-industrial and that she should be treated on a non-industrial basis is not evidence and will not be considered since it exceeds his authority. However, the panel finds Dr. Smith’s recommendation that applicant should undergo an excision and biopsy of the hip mass as consistent with the probable diagnosis of lipoma and recognition of the appropriate diagnostic procedure to determine the nature of and proper course of treatment for the left hip mass. Thus, it finds Dr. Smith’s report as evidence that an excision/biopsy of the left hip mass is medically necessary for determination of the actual nature of applicant’s left hip condition.

Next, the panel addresses whether Dr. Smith’s reports should be provided to QME Dr. Roland for his review and consideration. The panel cites DIR Rule 35.5 (Cal. Code Regs., tit. 8, § 35.5). That rule, which is applicable to AME and QME evaluations conducted after January 1, 2013, regardless of the date of injury, prohibits the AME or QME from providing an opinion on any disputed medical treatment issue. The rule specifies the role of the AME or QME vis-à-vis medical treatment issues is limited to whether the injured employee will require future medical treatment to cure or relieve the effects of an industrial injury.

In its application of Dir Rule 35.5 to this case, the panel observes that Dr. Smith was engaged as the MPN IMR physician for the sole purpose of determining whether applicant should undergo an excision of the mass on her left hip, for which defendant denied liability. Thus, the only issue properly addressed by Dr. Smith was the medical necessity of the hip procedure. The panel then reasoned that since DIR Rule 35.5 prohibits QME Dr. Roland from addressing disputed medical treatment issues, there is no reason for him to review Dr. Smith’s report. It reversed the WCJ’s finding, which would have allowed Dr. Smith’s report to be provided to Dr. Roland for review and consideration.

Finally, the panel notes that the AD promptly adopted Dr. Smith’s MPN IMR report endorsing the left hip mass excision as medically necessary and that neither party appealed that determination. Since the AD’s determination is presumed correct and the Appeals Board and WCJ are prohibited from making their own determination of medical necessity where the underlying UR was timely, the panel concludes that substantial evidence supports the finding that excision of applicant’s left hip mass is reasonable and necessary medical treatment. In its decision after reconsideration, the panel amended the F&O to find that while Dr. Smith’s report is substantial evidence that applicant needs and is entitled to left hip surgery as a diagnostic procedure, Dr. Smith cannot address applicant’s need for the left hip surgery on an industrial basis. Also, the panel reversed the order allowing Dr. Smith’s report to be provided to Dr. Roland for his review and consideration.

Significance of Serrano

While the panel’s opinion is simple and straightforward, it carries a meaningful message. Within California’s workers’ compensation laws, medical evaluators have well-defined, circumscribed roles. QMEs and AMEs are allowed to address issues, such as whether a claimed injury or condition arose out of and occurred in the course of employment, the level of impairment, if any, caused by an injury, and whether the injured employee may in the future require medical treatment to cure or relieve the effects of the injury. But when it comes to a dispute over a specific form of medical treatment, the QME and AME have no role at all. That issue, and that issue only, is within the exclusive province of the UR/IMR physician and the MPN IMR physician. The role of the UR/IMR physician and the MPN IMR physician is to determine whether the disputed treatment is necessary from a medical perspective and consistent with applicable guidelines. The matter of any causal relationship between the injury and the disputed treatment is irrelevant to that consideration and off limits.

Reminder: Board panel decisions are not binding precedent.

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