Expectations for DWC's UR Audit Ramp Up Mixed

Published on 02/16/2016 by WorkCompCentral, Authored by Greg Jones

The most vocal critics of utilization review reacted to the Division of Workers' Compensation's announcement that it will ramp up audits this year with a range of opinions, from "it's about time" to "so what."

The division last week said its Audit and Enforcement Unit will be noticing more target audits in 2016 to address utilization review complaints. 

Claims administrators and utilization review organizations are subject to random audits at least once every five years. But the division can also initiate what it calls a special target investigation or target audit based on credible complaints.

DWC spokeswoman Erika Monterroza said Friday the division has not seen an increase in complaints about utilization review in recent years. Rather, she said the agency understands that the current UR audit process, which analyzes a random selection of authorization requests from a three-month period, "may not sufficiently capture the totality of UR violations that accurately reflect a claims administrator's or URO's performance."

The division's Feb. 10 announcement of its plans to conduct more target audits included a reminder that all claims administrators must have a utilization review program that is governed by written policies and procedures. And all UR programs must have a medical director, the division said. Decisions to modify or deny a treatment request can only be made by a reviewing physician, and the services must be within that reviewing physician's scope of practice.

Also, UR decisions must be rendered within five business days from the receipt of a request for authorization, unless additional information is needed to make a decision, in which case a determination is due 14 calendar days after receipt of the authorization request.

Penalties for violations range from $100 for a late decision to $25,000 if a someone other than a physician denies or modifies a request.

Monterroza said the issues highlighted in the statement are critical components of UR and "compliance in these areas is likely indicative of overall performance."

She said the division is committed to ensuring injured workers receive medically necessary care in a timely manner and that UR violations, whether intentional or the result of confusion, are identified and corrected.

Bert Arnold, president of the California Applicants' Attorneys Association, said it's about time the DWC delve deeper into problems that he and his organization say are persistent with utilization review.

CAAA has called UR in California's workers' compensation system "broken." The group says UR is not used so much to ensure treatment requests are appropriate, but as a way for carriers to delay or deny legitimate medical care. CAAA has a page on its website featuring more than a dozen first-hand accounts from injured workers who say carriers used UR to summarily terminate treatment.

Arnold was not available for an interview on Friday. But he said in a statement that he is looking forward to seeing the results of the audits.

"It has been a long time coming that the DWC is finally stepping up its audits of all the abuses in the UR process that have harmed too many injured workers in the state," he said.

Fellow applicants' attorney Alan Gurvey, managing partner of Rowen, Gurvey & Win, is not so optimistic.

"Anyone who understands the gravity of the problems with UR knows that these audits are simply window dressing done to look like something is being done to police the system, but, in actuality, it does little to simplify the process and make it more efficient," he said. "What is actually behind the windows is a seriously dysfunctional system that window dressings can't possible have any appreciable impact on."

Gurvey said he doesn't expect the audits will involve an investigation into what medical records and reports were actually reviewed, the time taken to review a request, which specialists are reviewing which requests and what medical treatment standards were applied. Such in-depth audits would likely be too costly, he said.

Audits may give the appearance of strong oversight, but they will likely not do much to address the situations giving rise to the Dubon, Bodam, Patterson and King cases, Gurvey said.

In Bodam, a significant panel decision issued in 2014, the WCAB said a UR decision is invalid if it is not timely communicated to the worker and the treating physician. Without a valid UR decision, the WCAB determined it had the authority to determine whether an injured worker should get the back surgery recommended by his doctor.

In Patterson, a significant panel decision issued in 2015, the WCAB prohibited a carrier from using UR and independent medical review to approve home health services that it discontinued without cause. 

In 2014, the WCAB issued two separate en banc decisions in Dubon. The first decision, know known as "Dubon I" held UR decisions suffering from a material procedural defect were not eligible for independent medical review and a workers' compensation judge could decide whether a requested treatment was appropriate.

The second decision, Dubon II, walked back the earlier ruling and held a UR decision is ineligible for IMR only if it is untimely.

Most recently, the 4th District Court of Appeals in King v. CompPartners said there is a doctor-patient relationship between UR physicians and injured workers that imposes upon the reviewing doctor a duty of care. 

The court did not address the extent of the reviewing doctor's obligations. But it allowed an injured worker who suffered multiple seizures after his regimen of psychotropic medications was abruptly terminated based on a UR decision finding the medications were not necessary to amend a complaint to properly state the nature of the allegation.

A tort claim that the UR provider was liable for wrongfully declaring the drug was not necessary is barred by exclusive remedy, the court said. But if the claim is that the doctor owed a duty of care to inform the worker about the risks of abruptly terminating the drug, the court said that would not fall under exclusive remedy.

"Only cases like the King case, that may put the individual UR doctor and the UR company on the hot seat for human beings who lose their lives or are seriously compromised by a UR denial, will serve as a lightning rod for fixing the system," Gurvey said.