Independent Medical Review (IMR) Case Law Update

| | Evidence Based Medicine, Utilization Review

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Toms Case Law Update Article for Aug 2016
At UR Nation, we closely track the issue of Independent Medical Review (IMR) for two reasons. First, we believe IMR, created by SB 863, provides an important improvement over the old system of having to litigate treatment requests before the WCAB. Under the old system, with litigation that included depositions, it seemed often took several months, or even a year, for an injured worker to find out if she could get a requested treatment. Now it takes 30-60 days. Second, as part of our business operations, we must make sure our UR process seamlessly interfaces with the IMR process. So anything that threatens IMR is of keen interest to us from a business process standpoint.

As some background, back in 2015 the California IMR process was challenged in Stevens v. WCAB. Frances Stevens fractured her foot in 1997 while working for a magazine publisher. Between 1999 and 2002 she underwent three surgeries on her foot. Further complications ensued, including complex regional pain syndrome and severe depression. Following a trial in May 2013, a workers’ compensation judge ruled that Stevens was permanently totally disabled.

In July of 2013, Stevens’ physician, Dr. Jamasbi, sought approval for Ativan, Flexeril, diolofenac cream and hydrocodone. In addition, Dr. Jamasbi sought home health for eight hours a day, five days a week. The request for authorization (RFA) was given to State Compensation Insurance Fund’s utilization review agent Bunch CareSolutions. Bunch CareSolutions retained Dr. Andrew Seltzer to perform the review. After review, Dr. Seltzer denied the request in its entirety. After an internal appeal, the matter proceeded to IMR.

The IMR reviewing physician also denied the request. In other words, the IMR physician affirmed Dr. Seltzer’s report that none of the prescribed medications were medically necessary and home healthcare, as prescribed, was not appropriate.

Stevens appealed the IMR decision to the WCAB. The WCAB stated that they had no jurisdiction. Stevens filed a writ petition with the California Court of Appeal for the 1st Appellate District. The thrust of her argument was that the IMR process was unconstitutional. She contended it violated the separation of powers doctrine (in which one branch of government has encroached on another). The Court of Appeal ruled that the legislature had the power to create the IMR process, the process is fundamentally fair in that workers have sufficient opportunities to present evidenced and be heard, and and that it does not violate the separation of powers doctrine.

In a very important development, the Supreme Court of California denied review of the Stevens case. And in February of 2016 the U.S. Supreme Court also denied review. This meant that the Court of Appeal’s ruling in Stevens became the law of California.

Recently, in a similar case to Stevens called Ramirez v. WCAB, the Court of Appeal for the 3rd Appellate District also ruled the IMR process is constitutional. Most attorneys, myself included, believed that the Ramirez case would be decided consistently with Stevens. To fail to do so would have likely triggered an appeal to the Supreme Court of California who would have overturned the Ramirez case.

But there is one more very interesting aspect about Ramirez v. WCAB.  It’s something defense attorney Jake Jacobsmeyer picked up on shortly after the ruling came down. Mr. Jacobsmeyer, a well respected and influential player in the comp arena, noted the harsh language the court used when it spoke in a denigrating manner about the WCAB making decisions assessing medical necessity.

Jacobsmeyer’s Lexis/Nexis article is here:

https://www.lexisnexis.com/legalnewsroom/workers-compensation/b/recent-cases-news-trends-developments/archive/2017/03/30/california-3rd-district-upholds-validity-of-imr-process.aspx

As you may know, Dubon II gave the WCAB the authority to determine medical necessity for treatment if utilization review is untimely. The reasoning is that if a utilization review is untimely (for example rendered in eight business days when the deadline is five business days) there is no dispute to resolve. In that instance, the Board takes the case out of the IMR process and an administrative law judge decides if the injured worker gets the requested treatment (just like in the system before IMR). But the Court said, in Ramirez, that “Any question that has the effect of assessing medical necessity is a medical question to be conducted by a qualified medical professional by way of IMR.”

As Mr. Jacobsmeyer adeptly pointed out, the language above suggests that medical determination, in any way whatsoever, is beyond the WCAB’s authority. So my take is this. If Dubon II is going to be challenged, look for the challengers to quote Ramirez v. WCAB, and argue that under no circumstances should the WCAB make a determination about medical necessity because the WCAB is not qualified to do so having no required medical training.

Now, granted, the Court in Ramirez v. WCAB did not state that the WCAB in Dubon II was wrong; and they could have done so. But it is clear from looking at the language in the case that the Court does not believe the WCAB should be making determinations of medical necessity.

We will continue to follow this issue and look for any challengers to Dubon II. Specifically, we will keep an eye out for those who want to see the WCAB stop making medical determinations, cite Ramirez v. WCAB.

Tom Swiatek

Tom Swiatek

As Assistant Vice President of Regulatory Services, General Counsel, and Editor in Chief of UR Nation, Tom Swiatek draws on his experience as an insurance attorney on both the general liability side, as well as on workers’ compensation matters. As a California Workers’ Compensation Section Member, Tom is leading the discussion with respect to the regulatory challenges and opportunities facing the workers’ compensation system.