Attorneys Predict Upswing in Litigation on UR Denials, Post-Dubon

Published on 03/04/2014 by WorkCompCentral, authored by Sherry Okamoto

Attorneys up and down the state are voicing strong reactions to the en banc Workers' Compensation Appeals Board decision last week in Dubon v. World Restoration, with some on the defense side decrying the decision as making it virtually impossible for the utilization-review process to work, and those on the applicant side hailing the ruling as the only way their clients can get a fair shake in a medical-review system that they feel is stacked against them.

Defense attorney Richard M. Jacobsmeyer of Shaw, Jacobsmeyer, Crain & Claffey sent out an e-blast the same day the decision came out, predicting that it would "wreak havoc with the medical treatment system in workers' compensation system, encourage and create substantial additional litigation and foment uncertainty in every challenged UR decision at the WCAB."

If Jacobsmeyer is right, applicant attorney Alan Gurvey of Rowen, Gurvey & Win counters, "then so be it." Gurvey insists that litigation and uncertainty are part of the growing pains of the comp system, and it's the price participants have to pay to provide injured workers with just outcomes for their cases. 

In the Dubon case, the WCAB ruled that it has the authority to determine the validity of a UR decision and that it can overturn decisions that are untimely or suffer from "material procedural defects."

Without such WCAB oversight, Gurvey said, workers would have no hope of getting the treatment that they need. 

"The system is absolutely inequitable," he contended. Gurvey said it feels like every UR decision he gets is a denial of authorization for a treatment, and many are "ridiculous." 

For example, he said he has a client who had a ruptured brain aneurysm. Gurvey said the worker's wife had been providing the worker with 24-hour-a-day care, seven days a week, for years, but once the injury was found to be compensable, the worker's employer and comp carrier requested UR review. 

Gurvey said the UR doctor called the worker's treating doctor at 5 p.m. on a Friday. When the treating doctor called the UR doctor back five minutes later, no one answered and no one returned his call. The treating doctor called two more times, without success, before a UR decision came back denying the worker home care assistance and transportation services. 

According to Gurvey, the UR doctor made the decision to deny the home care and transportation services without having ever spoken to the worker's treating doctor or looking at all of the medical evidence from the treating doctor and the panel qualified medical evaluators in the case.

"So all the experts say, 'yes, he needs this,' but the UR doctor who didn't see all the records and didn't see the patient and didn't talk to the treating doctor, says 'no,'" Gurvey said.

Gurvey said he thought "the WCAB did what was right" in issuing the Dubon decision. "The Dubon case shows they were interested in justice, not simply trying to pander and suck up to insurance companies and defendants," he opined. "They're trying to at least inject some judicial intelligence into the system."

Jose Dubon had suffered injuries to his back in 2003 and 2004 while working for World Restoration. Last July, he requested authorization from his employer's insurance carrier – the State Compensation Insurance Fund – for surgery. State Fund's agent, Bunch CareSolutions, denied the request last July based on a UR report by Dr. Donald A. deGrange, a board-certified orthopedic surgeon. 

After Dubon unsuccessfully invoked Bunch CareSolutions' internal UR appeal process, he filed an application for independent medical review.

Pursuant to the new administrative dispute-resolution process that was created by Senate Bill 863, an applicant or applicant attorney has 30 days after receiving an adverse UR decision to apply for IMR.

According to data released by the California Division of Workers' Compensation in January, roughly 75% of all treatment requests are being approved without UR, and 76.6% of claims that go through UR are being approved. This means that only 23.4% of UR decisions, and 5.9% of all medical treatment requests, are eligible for IMR. The DWC has said that IMR upholds the UR decision about 79% of the time. 

The California Applicants' Attorneys Association disputes the DWC's figures, saying that at least one sample shows that less than 65% of requests for authorization are approved.

Under the process set up by SB 863, Maximus Federal Services Inc. – the company under contract with the state to provide IMR services – will not look at any case in which there has not yet been a UR denial. Maximus has been struggling to keep up with the number of IMR requests coming in. Between July and November 2013, a total of 58,130 IMR requests were filed, and Maximus only was able to issue decisions in 4.32% of those cases. 

Pursuant to the WCAB's decision last week in Dubon, however, a case will not go to IMR if the UR was procedurally deficient.

Jacobsmeyer, in his email, railed against this ruling as evidencing "a complete lack of understanding of both the actual workings of utilization review and a failure to consider the practical impact of the decision."

He said the Dubon decision "will effectively make virtually every UR decision subject to judicial review at the WCAB," and he contended that the board had created a new obligation for claims administrators that is not authorized by statute and is wholly "impractical" in light of the tight deadlines in the UR process. 

The WCAB found the UR decision in the Dubon case to be invalid because the UR doctor either did not receive or did not review all of the relevant medical records related to Dubon's condition.

Jacobsmeyer contended that nothing in the Labor Code requires a claims administrator to provide a UR physician the applicant's entire medical file for review. He said that it would be unreasonable to expect a claims administrator to be able to do so when a UR vendor has only five days to return a decision. 

He further suggested that the Dubon decision allows applicants to play "a new game of 'gotcha,'" by having their doctors provide as little information as possible to claims administrators, so that they can challenge the UR decision as invalid if the claims administrator doesn't manage to get the full medical file to the UR reviewer before the UR reviewer issues a decision.

Two other defense attorneys contacted by WorkCompCentral didn't share Jacobsmeyer's pessimism about the impact of the decision.

Gregory Grinberg, a defense attorney in San Mateo, said he doesn't think the Dubon case marks any significant change in the comp system. He said his experience prior to the decision coming out was that applicants' attorneys were regularly challenging UR decisions as being invalid because of untimeliness and the UR doctor's failure to consider all the evidence.

Grinberg said the WCAB just reaffirmed the theory used by many applicants' attorneys already – that invalid UR decisions can't go to IMR.

In fact, he said, the Dubon decision "might cut down on a bit of litigation" because "a savvy defense attorney can review a UR report and advise his client as to whether this would pass regulatory muster."

Tim Kinsey of Grancell, Stander, Reubens, Thomas & Kinsey said his experience in Orange County has been similar to Grinberg's.

He said applicants' attorneys in Orange County have already been making the argument that procedural defects in a UR decision give the WCAB jurisdiction to review, so he didn't foresee an increase in litigation prompted by applicant attorneys challenging UR decisions. 

Kinsey added that he didn't think there was much to fight about, since UR is "pretty black and white" when it comes to timeliness issues. "You either got it done on time or you didn't," he observed.  

Applicants' attorney Arjuna Farnsworth of Boxer & Gerson in Oakland said that having to show a "patent defect" by UR to invalidate the decision is nothing new, so only a small percentage of UR denials have been, and will continue to be, litigated. 

By contrast, San Diego applicant attorney John Don said he thought Jacobsmeyer's prediction may prove to be true.

Don suggested that the WCAB might get hit with "hundreds if not thousands of expedited hearings requesting that the WCAB determine whether a UR flaw rises to the level where the integrity of the UR decision is compromised" because workers want to avoid going into IMR.