Preparing for Treating Doctor Network Fights - Part 2

Saturday, July 31, 2004 | 0

TREATING DOCTOR NETWORKS: HOW THE DEFENSE MUST PREPARE FOR THE FIGHT

Part 2

By Michael Sullivan, Esq.

Ed. Note: This is the second in a series of three articles.

3. Applicant attorneys will try to use predesignation to avoid the network.

Predesignating a physician has long been a way to avoid medical control. Labor Code section 4600 has allowed it for years. If a worker predesignates a physician, medical control remains with the worker, even under SB 899 (although there is now a sunset provision of April 30, 2007.)

So, if you are an applicant's attorney, why not simply have every worker in California predesignate a doctor and avoid the network altogether? SB 899 seems to anticipate this. It lays out several new conditions for the predesignation of physicians. The doctor has to be (1) the regular "physician and surgeon" of the employee; (2) the physician has to be the employee's primary care physician - this includes a requirement that he or she has previously directed the medical treatment of the applicant and retains his or her medical records; and (3) the physician must agree to be predesignated. Clearly we must use these new rules to prevent abuse of the predesignation process.

It is also important to note that under new Labor Code section 4600(d)(5) only seven percent (7%) of all employees in the state are allowed to predesignate at one time. Perhaps the Rules will clarify for us how that is supposed to work. For now, though, it is difficult to understand how that will be assessed and enforced, much less used by the defense. Say for example a union shop decides to try and meet the requirements for a predesignated physician for all of its employees before the end of the year. It has everyone sign up, transfer their medical records, and go in for some treatment. Will the defense be able to use this aspect of SB 899 to defend itself? One interpretation of this statute may be that the seven percent threshold apply to individual companies. It is difficult to make specific recommendations on this point before the Rules are published in November. Certainly such an effort will have to be seen for what it is, and the defense will argue that the doctor-patient relationship is an illusion and a fraud.

What if the applicant predesignates a physician, and then later decides that he does not want to use that physician, or for whatever reason that treatment cannot proceed? The CEB books refer to the only case available on this issue, Withers v. The May Department Store (2002) 30 CWCR 15. In Withers there was already a predesignation done, and treatment commenced with the applicant's doctor. That doctor was unable to help. It was held that treatment did not revert to the employer's control, but that the applicant was allowed to find another doctor and retain control. Perhaps the new intention of SB 899 will allow us to argue for a different point of view.

4. Applicant attorneys will argue that failure to notify the applicant of the right to predesignate gives the applicant the right to medical control.

In addition to the strategy of predesignation, applicant's attorneys will argue that the failure to notice an employee of the right to predesignate a physician in and of itself entitles the applicant to avoid imposition of employer control.

It is clear that the employer must notify the applicant of the right to predesignate a physician. It is required that the right to this be posted (Labor Code section 3550; Rule 9782). It is required also under the 2002 legislation (AB 749) that the employee be specifically notified of his or her right to select a predesigated physician. This is to be performed either at the time of hiring or at the end of the first pay period. (Labor Code section 3551(b).) But does a failure to notify the employee of this right result in a loss of medical control under the new law?

An instructive case is Albert Perez v. WCAB (1999) 64 CCC 323. This case was published before AB 749, which gave us specific instruction to notify the employee of predesignation rights. Perez did discuss the issue in the context of Rule 9782, though, and that Rule does and did require that the applicant be informed of his right to predesignation by way of a posted notice. The applicant testified that he saw but did not read the posters. The Court of Appeals concluded that the employer had complied with the law, and agreed with the WCJ that even if the Rule had been violated, there was no authority in the law that would shift medical control. From this case the defense should be able to make a strong argument that noncompliance with notice requirements does not mean a loss of medical control. Naturally, applicant's attorneys will disagree with this and argue that the context under SB 899 is much different.

My seventh recommendation is that each employer ensure that all employees are notified in compliance with both the posting requirements, and the direct notification requirements, regardless of when they were hired. My eighth recommendation is that each employer makes sure to notify their employees in writing of the three new standards of predesignated physicians. Even if the employee has been advised before, he or she should be advised again under the new standards. I would require the employee to acknowledge that the physician selected does meet the requirements of having provided care in the past and of being that person's general physician; I would require that the physician submit in writing his or her consent to the role. If these requirements are not met I would not recommend accepting the predesignation.

When the Rules come out in November more details may be in place on how to do this. However these recommendations should be implemented before the end of the year.

Article by attorney Michael Sullivan. Mr. Sullivan can be reached by e-mail at mike@mikeslaw.com, or by phone at (310) 337-4480.

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The next article in this series will review dispute resolution and within network change attempts.

The views and opinions expressed by the author are not necessarily those of workcompcentral.com, its editors or management.