California: Can a Utilization Review Determination Exceed Its Appropriate Scope?

With respect to the increasing litigation over the UR process, is Dubon really the issue in many of these UR disputes?

Utilization Review (UR) has been around for more than ten years now. UR first came into play in 2003 when Governor Gray Davis passed Senate Bill 228. The following year, on April 19, 2004 (SB 899), Governor Arnold Schwarzenegger expanded the role of UR in California workers’ compensation. Most recently, in 2012, Senate Bill 863 added to the reviews by adopting Independent Medical Review (IMR). Despite its relatively long tenure, however, there is currently not a more controversial issue in the California workers’ compensation system than UR.

Indeed, in recent months, the California workers’ compensation system has seen a significant increase in the number of hearings addressing the validity of a UR decision and the injured worker’s entitlement to medical treatment. The typical Workers’ Compensation Judge (WCJ) is being asked to review treatment reports, treatment guidelines and UR determinations and determine an injured worker’s entitlement to medical treatment more frequently than prior to the adoption of SB 863. This is particularly ironic in view of SB 863’s expressed public policy that the adoption of the IMR process was to ensure that medical decisions were to be made by medical physicians and not WCJ’s (Section 1 of Senate Bill 863).

Some may point blame on the February 27, 2014 en banc decision by the WCAB in Dubon v. World Restoration (2014) 79 Cal. Comp. Cases 313 (Appeals Board en banc opinion). Others might point blame at the adoption of IMR and the very limited statutory challenges that are available when taking on an IMR decision. Additionally, prior to IMR, if an injured worker lost a treatment dispute at UR, that injured worker had a better than fair chance of prevailing on the dispute by going to an AME or QME. However, it’s actually probably a combination of both. Dubon basically opened the door for the present UR challenges and, in light of IMR, injured workers have tried to take advantage of that opening.

In Dubon, the WCAB found that the IMR process solely resolves disputes relating to the medical necessity of treatment requests. The decision further stated that a UR determination could be found invalid if the UR determination was untimely or if the UR determination suffers from a “material procedural defect that undermines the integrity of the UR decision”. Finally, if the UR decision is invalid, the WCAB, based on substantial evidence, can then determine the injured worker’s entitlement to medical treatment.

The WCAB has now granted reconsideration of Dubon so as to further study the contentions raised in State Compensation Insurance Fund’s petition for reconsideration (see 79 Cal. Comp. Cases 566).

In the context of this increasing litigation over the UR process, is Dubon really the issue in many of these UR disputes?

In court filings, Dubon is certainly frequently identified as the issue; however, in many of these disputes, whether or not the UR doctor issued a timely report or saw adequate medical records is not really the issue.  More often, the problem with the UR determination is the reasoning behind the UR determination. For example, in many cases, a UR physician may conclude that the injured worker fails to meet the diagnostic criteria for Complex Regional Pain Syndrome or may conclude that the extent of spinal stenosis is insufficient to justify a fusion. In one very recent case, the reviewer did not agree with the treating physician’s diagnosis of facet mediated disease in the spine despite the fact that that is exactly what the MRI showed.  

Is it appropriate for the UR physician to question the diagnosis or other medical findings already made in the case? This raises the question of what is the purpose of UR?

Labor Code Section 4610(a) provides that “utilization review” functions to review based on “medical necessity” to cure and relieve treatment recommendations made by physicians. Labor Code Section 4610(c) states that the UR process, specifically the policies and procedures that define the UR process, shall “ensure that decisions based on the medical necessity to cure and relieve of proposed medical treatment services are consistent with the schedule for medical treatment utilization adopted pursuant to Section 5307.27” (emphasis added). Labor Code Section 5307.27 effectively provides that prior to December 1, 2004, the administrative director (AD), in consultation with the Commission on Health and Safety and Workers’ Compensation, shall adopt a medical treatment utilization schedule (MTUS).

Moreover, Labor Code section 4600(b) provides “. . . notwithstanding any other law, medical treatment that is reasonably required to cure or relieve the injured worker from the effects of his or her injury means treatment that is based upon the guidelines adopted by the administrative director pursuant to Section 5307.27.”

Furthermore, Labor Code section 4604.5(a) mandates that the recommended guidelines set forth in the MTUS adopted by the AD pursuant to Section 5307.27, “shall be presumptively correct on the extent and scope of medical treatment.” The statute further provides the presumption is rebuttable and may be controverted by a preponderance of the scientific medical evidence establishing that a variance from the guidelines reasonably is required to cure or relieve the injured worker from the effects of the industrial injury.

Consistent with Labor Code section 4604.5(a), California Code of Regulations, title 8, Section 9792.25 also states that only the MTUS is presumptively correct on the issue of extent and scope of medical treatment and diagnostic services addressed in the MTUS for the duration of the medical condition.

Accordingly, UR is supposed to look at the treatment recommendation made by the treating physician and match that up to the applicable treatment guideline, assuming a treatment guideline applies. If the MTUS does not address the treatment, then Labor Code Section 4610.5 provides a hierarchy of authority for the reviewer to consider. After the MTUS, the reviewer is then to look at peer reviewed scientific and medical evidence, nationally recognized professional standards, expert opinion, generally accepted standards, and lastly, treatments that are likely going to be of benefit to a patient for conditions for which other treatments are not clinically efficacious.

In more simple terms, the function of UR is to identify the treatment recommended in the treating doctor’s request and then match the recommended treatment to the applicable treatment schedule. If the MTUS does not address the treatment, then the reviewer can look at other information in hopes that it addresses the disputed treatment.

The point is to ensure that the treatment being provided to the applicant is based on accepted treatment guidelines or some other objective standard. In theory, this will ensure that the injured worker is receiving the type of treatment that he or she should for the injury involved.

The point of this article, however, is to suggest that in many of the current disputes, the dispute does not center on whether a treatment guideline applies. The dispute does not center on what has been described as a “Dubon issue”. Rather, the dispute centers around the treating physician’s diagnosis, overall treatment plan, or perhaps some physical finding made by the treating physician.

If a UR reviewer goes beyond the stated function of UR and challenges the diagnosis or other physical finding made by the treating physician, this may be an issue of whether the UR reviewer has exceeded the appropriate scope of UR. In other words, this may be more of an issue that falls under the analysis set forth in Simmons v. State of California (2005) 70 Cal. Comp. Cases 866 (Appeals Board en banc opinion).

 In Simmons, SCIF was arguing that UR applied even if there was a question that the disputed treatment was industrially caused. The WCAB concluded that a UR report is not admissible on the question of whether an industrial injury caused or contributed the need for treatment, only on the question of medical necessity. The Board further concluded that where the UR reviewer identifies a question of causation, the defendant must timely initiate the AME/QME process.

In conclusion, when evaluating a UR determination, practitioners may want to consider the specifically stated purpose of UR and determine whether the UR determination is consistent with that stated purpose. If it is not, then perhaps the dispute is one which should be resolved through the process provided for under Labor Code Section 4062(a) and not by raising Dubon and litigating the issue before the WCAB.

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