California Panel QME Process: Is It Time to Admit We Are Dealing With a Monster?

A serious question needs to be asked about whether requiring the use of one Qualified Medical Evaluator (QME) in a workers’ compensation case, as opposed to the use of “battling QME’s”, has reduced litigation or has actually served to increase litigation. No question, at least conceptually, the idea of having one doctor evaluate an injured worker instead of two doctors with diametrically opposed opinions seemed like a good idea. Much like Dr. Frankenstein probably had a good idea at the outset, people are increasingly viewing the Panel QME process and the gamesmanship and hyper-technical arguments it fosters as, well, a monster. 

Indeed, it appears to have become the exception rather than the rule to have a case where one of the parties is not trying to have the existing Panel QME removed due to one argument or another. One of the most common “QME issues” has to do with an alleged ex parte communication. The concern raised in these cases is that one of the parties improperly communicated with the QME or that one of the parties may not have submitted information correctly to the QME.

Labor Code Section 4062.3, subdivisions (e), (f) and (g) state:

“(e) All communications with an agreed medical evaluator or a qualified medical evaluator selected from a panel before a medical evaluation shall be in writing and shall be served on the opposing party 20 days in advance of the evaluation. Any subsequent communication with the medical evaluator shall be in writing and shall be served on the opposing party when sent to the medical evaluator.

“(1) Ex parte communication with an agreed medical evaluator or a qualified medical evaluator selected from a panel is prohibited. If a party communicates with the agreed medical evaluator or the qualified medical evaluator in violation of subdivision (e), the aggrieved party may elect to terminate the medical evaluation and seek a new evaluation from another qualified medical evaluator to be selected according to Section 4062.1 or 4062.2, as applicable, or proceed with the initial evaluation.”

“(g) The party making the communication prohibited by this section shall be subject to being charged with contempt before the appeals board and shall be liable for the costs incurred by the aggrieved party as a result of the prohibited communication, including the cost of the medical evaluation, additional discovery costs, and attorney fees for related discovery. (Emphasis added.)

Many, many QME’s are being removed from cases due to alleged ex parte communications. Commonly, the issue ends with the Panel QME being removed from the case and the parties proceeding with a new panel of physicians from the Medical Unit. However, Labor Code Section 4062.3(g) clearly provides additional remedies for violations of these sections. Though there are not a lot of cases addressing the application of Labor Code Section 4062.3(g), a recent panel decision of the Workers’ Compensation Appeals Board (WCAB) did just that.

In Ramirez v. Parking Concepts, United States Fire Insurance Company, ADJ2888182, a panel of commissioners addressed a workers’ compensation administrative law judge’s (WCJ) award of attorney’s fees to applicant’s attorney as a sanction pursuant to Labor Code section 4062.3(g), as a result of defendant’s improper ex parte communications with three different panel Qualified Medical Evaluators (PQME). The WCJ awarded applicant’s counsel the sum of $27,335.00 as an attorney fee as a consequence of defendant’s multiple alleged violations.

The facts of the underlying case are interesting. Defendant initially requested a PQME, and a panel list was sent to the parties. The first PQME was Dr. Anselen. Defendant sent an advocacy letter directly to the PQME in violation of section 4062.3(b) and (e). Applicant later sent a copy of his objection letter to the PQME. Following a hearing, a new panel of QME’s was ordered by the WCJ.

A second PQME was selected and the parties attempted to agree on a letter to be sent. Defendant requested a hearing when the parties could not agree, but also sent its own advocacy letter in violation of the rule against ex parte communications. As a result of this ex parte letter, the WCJ then ordered a third PQME.

Following the examination by the third PQME, applicant objected to the fact that the first PQME report was sent to the third PQME in violation of Administrative Director Rule 35(e). Applicant’s objection was made after the examination but before the report was issued. It was at that point that applicant filed a request for attorney fees under Labor Code Section 4062.3(g). Following a trial, the WCJ awarded attorney fees payable to the applicant’s attorney totaling $27,335.00.

In reviewing the WCJ’s award of attorney’s fees, the commissioners noted:

“Here the WCJ found defendant committed repeated violations of Rule 35 and sections 4062.2 and 4062.3 and ordered the chosen PQME to be replaced by a new PQME. We see no error in the WCJ’s conclusion that defendant’s conduct was sufficient to trigger the attorney fee provision of section 4062.3(g). Whether defendants’ repeated violations were intentional or merely the result of carelessness, its conduct caused delays and necessitated the selection of three PQME’s entitling applicant’s attorney to an appropriate fee for his discovery related efforts.”

The commissioners’ decision seems to imply that some level of misconduct is warranted to “trigger the attorney fee provision” of Labor Code Section 4062.3(g). The statute, however, does not seem to require any particular level of misconduct. All it seems to require is a prohibited communication and at that point the offending party “shall be subject to being charged with contempt before the appeals board and shall be liable for the costs incurred by the aggrieved party as a result of the prohibited communication, including the cost of the medical evaluation, additional discovery costs, and attorney fees for related discovery”.

Not only are these QME disputes usurping an increasing amount of the WCAB’s limited resources, given the statute’s plain language, there are serious financial incentives built in so as to encourage the parties to pursue these issues. The Ramirez case dealt with ex parte violations by a defense attorney. What about the case where the applicant’s attorney violates the statute? Is that a cost that the attorney or his client will bear? Can either the attorney or client afford a sanction potentially exceeding the $27,335 found in Ramirez?

We are now more than eight years after Senate Bill 899. It appears few in the workers’ compensation community would argue that the “new” Panel QME rules have served their desired purposes. Whether it is the repeated and usually hyper-technical arguments the parties feel they are obligated to make so as to have the Panel QME thrown off of a case, or the potentially misguided financial incentives provided for by Labor Code Section 4062.3(g), it might be time to admit that we are dealing with a monster.