IN THE WARM CALIFORNIA SUN
California dropped most of its COVID-19 restrictions, effective 6/15/2021, including the tier system that set restrictions by county. While unvaccinated Californians are still asked to wear masks and the Occupational Safety and Health Standards Board is still determining what proper workplace policies look like, for the vast majority of Californians (over 70% have had at least one vaccine dose per the CDC) the mask is no longer necessary for most activities. The policy shift means that we can avoid those unseemly mask tan lines if we’re outdoors as the summer heats up. We at Mullen & Filippi hope you all get a well-deserved summer frolic of some sort this year.
FIGURING OUT THE NEW MEDICAL LEGAL FEE SCHEDULE
In less sunny news, parties in the workers’ comp community are still figuring out what to make of the medical-legal fee schedule changes. The changes have put a great deal of pressure on attorneys, adjusters, and doctors already dealing with a high volume of cases to meet and confer and pare down the documents sent to the doctor. This boutique approach isn’t necessarily aligned with common practices in the industry. While it is our philosophy that every cover letter and production of documents in each claim should be lovingly crafted to provide a fair and full summary of the facts and issues, while keeping costs reasonably contained, the approach takes time, and appears to be taking some getting used to for all parties.
Built into the new laws is an inherent tension between containing costs and ensuring that reports produced after an evaluation are based on a complete record and so constitute substantial evidence. Both injured workers and employers have a vested interest in doctors getting the record straight; on the other hand, one could easily imagine (sadly, I don’t have to imagine) a case where an AME or QME is replaced late in the litigation process and the cost of an accurate report could possibly be so astronomical as to dwarf the value of indemnity or even future medical care in the case. If a QME is required to review an existing record consisting of 15,000 pages, for instance, under the new rules, after the flat fee of $2,015 for the evaluation and first 200 pages reviewed, at $3/page, the bill for the review will increase by $44,400. It would require a special case indeed to justify that sort of expenditure.
While some might think that the law could encourage generosity born of a cost benefit analysis in settlement negotiations, the likelier outcome seems to be more litigation about what is or is not sent to the medical-legal evaluator. It is clear that in most cases doctors won’t need to read the tax returns of injured workers from 15 years ago, nor medical records discussing a body part completely uninvolved in a given claim. However, it is less clear that a medical-legal evaluator shouldn’t review RFAs and UR for physical therapy in a case where they are being asked to determine permanent and stationary status.
While chatter amongst practitioners suggests that parties would love more guidance from the WCAB as to standard practices given this new fee schedule, for the time being it seems like these matters will be handled on a case by case basis at Expedited Hearings, possibly with the same frequency as QME specialty disputes and other litigated discovery issues. Article XIV sets forth a constitutional mandate that the compensation system accomplish substantial justice expeditiously, inexpensively, and without encumbrance of any character. The new rules mean parties may have to pick between inexpensive and expeditious.
Senate Bill 788, which on its face prohibits discrimination on the basis of race, religion, national origin, age, gender, marital status, sex, sexual identity, sexual orientation, or genetic characteristics, could possibly reconfigure the concept of apportionment. The tension with the original legislative intent behind Labor Code 4663 remains alive, having been referred to the Assembly Insurance Committee on 6/2/2021 for further review.
Senate Bill 335, which would amend Labor Code 5402 to reduce the investigation period for a claim from 90 days to 45 days, also remains alive, having been referred as well to the Assembly Insurance Committee on 6/10/2021.
You can follow the progress of these and other bills here: https://legiscan.com/CA
6TH CIRCUIT: FITZPATRICK UPHELD AND TREATING PHYSICIAN SEXUAL MISCONDUCT COMPENSABLE
In one of the more thorough decisions a Court of Appeal has issued in the realm of workers’ compensation, touching on the case law and history of many of the major issues in the field, the 6th District Court of Appeal indicated that the Fitzpatrick court was correct in finding that disability must generally be found in accordance with Labor Code 4660, and clarified the path to higher disability under Labor Code 4662(b), “in accordance with the fact.” The Court indicated that a permanent disability rating may still be rebutted medically or vocationally using the methods that are set forth in established lines of cases such as Almaraz and Ogilvie.
Prior to Fitzpatrick, however, many permanent and total awards were based on a statement by a physician that the applicant was permanently and totally disabled, without any analysis provided by vocational experts or any attempt at rebutting any of the elements of the strict rating per Almaraz (though such statements of total disability were frequently characterized as “Almaraz” findings). A conclusory statement as to permanent and total disability will not be upheld as disability “in accordance with the fact,” under Labor Code 4662 according to this decision and the earlier 3rd District Fitzpatrick decision.
The Court of Appeal also, in what was thankfully a matter of first impression, found that sexual misconduct by a treating physician can result in a compensable injury (in this case PTSD). In this case, a physician who was in the employer’s MPN engaged in a sexual relationship with a patient he had been treating for over five years and to whom he had been providing medication. The Court found enough of a nexus between treatment and injury such that the resulting PTSD was compensable. First the Court rejected any argument that this was a consensual relationship that took the conduct out of the employment relationship, reasoning that the activity, even if reported as consensual by both parties, was covered by the definition of sexual exploitation set forth in the Business and Professions Code 729. This section allows for criminal prosecution of a physician who engages in sexual activity with a patient and bars consent as a defense. The Court noted that the definition of proximate cause differs significantly between tort law and workers’ compensation law, and noted that under Labor Code 3600, an injured worker must only establish that employment was one of the contributing causes without which the injury would not have occurred.
Focusing on the removal of fault from consideration in workers’ compensation, the Court found that there was enough connection to the treatment arising out of the industrial injury to make any injury caused by the sexual misconduct compensable. It is very likely and hoped that this portion of the case will be of limited applicability to future cases. Also, it is unclear how far a court would take the reasoning and at what point the actions of a third party would be so unrelated to employment, that the chain of causation would be broken even under the low bar set forth by Labor Code 3600.
I was fortunate enough to listen in on oral arguments, and the case was extremely ably argued. The case touched on a variety of topics and merits a much fuller case analysis, which we will be posting in our Case Briefs section in the very near future. The 74-page decision in the two cases of Applied Materials v. WCAB and XL Specialty v. WCAB was recently certified for publication and is now citable authority.
This month, Lauren Coleman, an Associate Attorney in our Oakland office provides an excellent breakdown of the recent WCAB decision of Ceja v. Taylor Farms Pacific, 2021 Cal.Wrk.Comp. P.D. LEXIS 79, in which the WCAB reminds us that even where there are issues with the timeliness or service of a Utilization Review, the applicant continues to have the burden of proof in establishing that medical care is reasonably required to cure or relieve the injured worker from the effects of the injury pursuant to Labor Code 4600. Ms. Coleman summarizes the facts of the particular case, the relevant statutes, and then provides helpful practice pointers to help you determine when it might be right to put your foot down as to a particular RFA, even if there are issues with Utilization Review.
This Bulletin was written by Jim Cotter, Senior Partner in our Oakland office.