Enforcing IMR Records Requirements

Friday, December 12, 2014 | 3

It appears that the California Division of Workers' Compensation is prepared to get tougher about enforcing independent medical-review regulations.

In a Nov. 25 newsline, the DWC announced that as of December it will begin to mete out penalties where claims administrators fail to send records to Maximus as required by Reg 9792.10.5.

Here is what the DWC announced:

“Under Labor Code section 4610.5(i), DWC is authorized to assess penalties against claim administrators whose conduct has the effect of delaying the IMR process. Under current regulations, Maximus Federal Services, Inc., the organization designated by DWC to conduct IMR reviews, sends the claims administrator a Notice of Assignment and Request for Information (NOARFI) in an IMR case. The notice advises of the relevant medical records to be submitted, which must be provided to Maximus within 15 days of the date on the NOARFI. The regulatory requirements for submitting records can be found at California Code of Regulations, title 8, section 9792.10.5.

Under California Code of Regulations, title 8, section 9792.12(c)(6), failure to submit the records within those 15 days will subject a claims administrator to an administrative penalty of $500 for each day the records are untimely, up to a maximum of $5,000. DWC will send an Order to Show Cause to claims administrators who may be liable for a penalty, with the facts upon which the penalty is based, the penalty amount and the administrative process for contesting a penalty.

The procedure to assess administrative penalties will commence in cases where there is a failure to timely submit medical records dated on and after Dec. 1, 2014. For IMR cases currently pending at Maximus as of Dec. 1, 2014, the penalty procedure will commence if the relevant medical records are not received on or before Dec. 15, 2014.

Apparently there are many cases where claims administrators fail to send medical records to Maximus. In an Oct. 22, 2014, presentation by Maximus on IMR, it was noted that “of the 42K open IMRs, 19K are missing medical records past the deadline for submission."

IMR was billed as a tool for achieving quality medical care for injured workers. The concept was to take treatment decisions away from workers and to place ultimate decision-making in the hands of vendor-contracted physicians.

This becomes absurd, of course, if the deciding Maximus doctors are not provided the relevant medical records. In many instances, the context is critical. What tests have been done, what treatments have or have not been tried, what physical findings do or don’t exist. The request for authorization form was not designed to replicate all that information. Moreover, treating physicians are not paid for putting detailed historical and contextual information on the RFA.

Often treatments are denied because the Maximus reviewer finds that a particular element required by MTUS is missing. Never mind that that element may be richly documented in the records if the Maximus reviewer was provided them and actually took the time to read the records.

Based on Labor Code 4610.6 (l), Reg 9792.10.5 (a)(1)(A) sets forth a requirement that the claims administrator shall provide “a copy of all reports of the physician relevant to the employee’s current medical condition produced within six months prior to the date of the request for authorization, including those that are specifically identified in the request for authorization or in the utilization review determination.”

Reg 9792.12(c)(6) provides for penalties for breach of Reg 9792.10.5.

If claims administrators play fast and loose with the requirements to provide medicals to IMR, the credibility of the whole process is in jeopardy. After all, many workers are unrepresented so they will not have the medical records to provide to Maximus.

And even where a worker is represented by an attorney, the attorney may not have the records. Claims administrators often fail to serve the attorney with medicals on a timely basis as required by Reg 10608(b)(1). Applicant attorneys frequently don’t have the relevant reports to send to IMR within the 15-day time frame from notice of assignment to Maximus.

So cheers are in order for the DWC’s notice that it intends to crack down.

Some employer advocates are unhappy, of course.

However, Reg 9792.15 gives employers due-process rights to contest penalties under Reg 9792.12. Ultimately, the DWC can assign a hearing officer who can make findings. And an employer can appeal those findings to the “Appeals Board in San Francisco” (see Reg. 9792.15 (y)) “in the same manner specified for petitions for reconsideration.”

The due-process section for administrative penalties against employers is substantially more generous than the appeals rights afforded workers from an IMR uphold.

And it should be remembered that employers and insurers won a victory for themselves while drafting the regs in that the DWC reduced the period of medical records that must be given to Maximus from 12 months to six.

The six-month records requirement is not that burdensome.

Fellow blogger David DePaolo notes that 45% of all IMR requests failed to send records that Maximus reviewers determined were necessary.

As a result, here’s what DePaolo suggests as a solution to the difficulties of the UR/IMR process:

“Here’s a simple way to avoid claims adjusters or judges from making medical decisions: determine the cost of the treatment appeal (UR or IMR) versus the cost of just approving the treatment. If the cost of appeal is more, then just approve the treatment."

Easy!

I know, there are complications like duration of temporary disability, probability of a good outcome, etc. etc. Those can all be factored into the decision point.

Here’s a proposed formula:

Cost of treatment anticipated TD anticipated PD = $X vs. Cost of all records TD pending appeal (say 30 days, but given usual delays, 60 may be better) anticipated PD without treatment anticipated TD post-denial of treatment (if any) TD (again if any) pending judicial review (90 days if expedited) TD (you know the caveat) pending WCAB review X percent of probability that judicial review will determine the UR/IMR timeline wasn’t followed = $X."

DePaolo’s formula highlights the complicated calculus that goes into medical treatment cost-containment. Kudos to him for designing the formula.

But as he says in his DePaolo’s Work Comp World blog, “Build your own model…”

And let’s be honest about it. Despite the high-minded talk about quality medical care, UR and IMR are essentially cost-containment mechanisms. They were sold to policymakers and various stakeholders on that basis.

In any event, overuse of UR and poorly performed IMR are likely to be problems with us for some time.

In the meantime, enforcement of the IMR regs becomes critical for injured workers.

Julius Young is an applicants' attorney for the Boxer & Gerson law firm in Oakland. This column was reprinted with his permission from his Workers' Comp Zone blog.