May IBR Process Be Used For Lien Disputes Filed Prior to Jan. 1?
Friday, October 19, 2012 | 0
With the Department of Industrial Relations’ (DIR) and Division of Workers’ Compensation (DWC) scheduled to enact new proposed regulations by November, the issue of whether medical providers with fee schedule disputes for dates of service prior to Jan. 1, 2013, can avail themselves of the “Independent Bill Reviewer” (IBR) under SB 863 Labor Code § 4603.6(a) and avoid the cost of either a lien activation fee/lien filing fee and or time limits to file a lien under Labor Code § 4903.5 (a) has been raised by providers.
When the procedure and forms required to implement SB 863 are finalized, there does not appear to be anything in the statute that precludes the medical provider from getting an IBR in a fee schedule dispute, regardless of the date of service and to use that determination as proof of money owed at hearings. SB 863 does allow it under Labor Code § 4903.6 as follows:
Labor Code § 4903.6 (a) Except as necessary to meet the requirements of Section 4903.5, a lien claim or application for adjudication shall not be filed or served under subdivision (b) of Section 4903 until both of the following have occurred: (1) Sixty days have elapsed after the date of acceptance or rejection of liability for the claim, or expiration of the time provided for investigation of liability, pursuant to subdivision (b) of Section 5402, whichever date is earlier. (2) Either of the following: (A) The time provided for payment of medical treatment bills pursuant to Section 4603.2 has expired and, if the employer objected to the amount of the bill, the reasonable fee has been determined pursuant to Section 4603.6, and, if authorization for the medical treatment has been disputed pursuant to Section 4610, the medical necessity of the medical treatment has been determined pursuant to Sections 4610.5 and 4610.6.”
However as stated above in Labor Code § 4903: “(a) Except as necessary to meet the requirements of Section 4903.5 …”
Labor code 4903.5 (a) A lien claim for expenses as provided in subdivision (b) of Section 4903 shall not be filed after three years from the date the services were provided, nor more than 18 months after the date the services were provided, if the services were provided on or after July 1, 2013.
Therefore the medical provider would still have to ensure that a lien was filed within the statutory time limits of Labor Code 4903.5 (a). In addition Labor Code § 4903.06(a) and Labor Code § 4903.06 (c) makes clear all liens will be subject to a lien filing fee, and liens filed prior to 2013 would be subject to a lien activation fee.
Labor Code § 4903.06 (a) “Any lien filed pursuant to subdivision (b) of Section 4903 prior to January 1, 2013, and any cost that was filed as a lien prior to January 1, 2013, shall be subject to a lien activation fee unless the lien claimant provides proof of having paid a filing fee as previously required by former Section 4903.05 as added by Chapter 639 of the Statutes of 2003.”
Labor Code § 4903.06 (c) “All liens filed on or after January 1, 2013, for expenses under subdivision (b) of Section 4903 or for claims of costs shall be subject to a filing fee as provided by this subdivision. (1) The lien claimant shall pay a filing fee of one hundred fifty dollars ($150) to the Division of Workers’ Compensation prior to filing a lien and shall include proof that the filing fee has been paid…”
The only exception under SB 863 that would allow a medical provider to avoid lien filing fees and/or activation fees and time for filing a lien under SB 863, absence any regulation in November 2012, which would be by consent of the parties under Labor Code 4903.4 with the necessary regulations by the DIR and DWC in November 2012.
Labor Code 4903.4 (a) If a dispute arises concerning a lien for expenses incurred by or on behalf of the injured employee as provided by Article 2 (commencing with Section 4600) of Chapter 2 of Part 2, the appeals board may resolve the dispute in a separate proceeding, which may include binding arbitration upon agreement of the employer, lien claimant, and the employee, if the employee remains a party to the dispute, according to the rules of practice and procedure.
(b) If the dispute is heard at a separate proceeding it shall be calendared for hearing or hearings as determined by the appeals board based upon the resources available to the appeals board and other considerations as the appeals board deems appropriate and shall not be subject to Section 5501.
Therefore SB 863 does not allow for a medical provider to take fee disputes out of the lien filing time lines and lien filing fee/lien activation fee as written for dates of service prior to January 2013. But if the medical provider does avail themselves of the IBR which is a cost to them, as yet to be determined, they could use that as evidence in court and if the lien claimant prevails, they would get that cost back. In addition, the medical provider must without exception comply with the SB 863 requirements to get reimbursed for their lien filing fee and/or activation fee.
Labor Code § 4603.6 (c) The provider shall pay to the administrative director a fee determined by the administrative director to cover no more than the reasonable estimated cost of independent bill review and administration of the independent bill review program. The administrative director may prescribe different fees depending on the number of items in the bill or other criteria determined by regulation adopted by the administrative director. If any additional payment is found owing from the employer to the medical provider, the employer shall reimburse the provider for the fee, in addition to the amount found owing.
Labor Code 4903.07 (a) A lien claimant shall be entitled to an order or award for reimbursement of a lien filing fee or lien activation fee, together with interest at the rate allowed on civil judgments, only if all of the following conditions are satisfied:
(1) Not less than 30 days before filing the lien for which the filing fee was paid or filing the declaration of readiness for which the lien activation fee was paid, the lien claimant has made written demand for settlement of the lien claim for a clearly stated sum which shall be inclusive of all claims of debt, interest, penalty, or other claims potentially recoverable on the lien.
(2) The defendant fails to accept the settlement demand in writing within 20 days of receipt of the demand for settlement, or within any additional time as may be provided by the written demand.
(3) After submission of the lien dispute to the appeals board or an arbitrator, a final award is made in favor of the lien claimant of a specified sum that is equal to or greater than the amount of the settlement demand. The amount of the interest and filing fee or lien activation fee shall not be considered in determining whether the award is equal to or greater than the demand.
(b) This section shall not preclude an order or award of reimbursement of the filing fee or activation fee, pursuant to the express terms of an agreed disposition of a lien dispute.
Unless the DIR and DWC come up with a creative regulation addressing fee disputes for dates of services prior to 2013, a medical provider in those cases would still be subject to a lien filing fee/activation and fee and have to file the lien within the statutory time limits of Labor Code 4903.5 (a). Which would appear to defeat the very issue that SB 863 was created to stop, that there are too many liens on file and said liens are clogging the court system.
Reid L. Steinfeld and Richard Boggan are attorneys with Grant & Webber, a receivables firm with offices in California, Washington, Nevada, Arizona and Texas.
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