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Young: Top 10 Developments in WC for First Half of 2020, Part 2

By Julius Young

Tuesday, July 21, 2020 | 250 | 0 | min read

On Monday, we had a look at the first five of my top 10 California workers' comp developments from the first half of 2020. We conclude with the second five today.

Julius Young

Julius Young

5. Some notable new regulations were promulgated.

Emergency qualified medical evaluator regs setting forth rules for telehealth evaluations went into effect May 14. The regs can be found here.

Updates to the Workers' Compensation Appeals Board Rules of Practice and Procedure went into effect as of Jan. 1.

6. A revision of the QME fee schedule remained a thorny issue but may be headed to a resolution that will not please some QMEs.

QME fee schedule revision has been a contentious issue for the Division of Workers' Compensation for several years. Forums and stakeholder meetings on the issue were held during 2018 and 2019, and a  2019 report from the California State Auditor was critical of DWC administration of the QME system.

In early January 2020, a Joint Legislative Audit Committee conducted an oversight hearing on the 2019 findings of the auditor. And in January the DWC convened two additional stakeholder meetings to discuss possible formulas for a revised QME fee schedule. But a bill designed to address the issue, AB 1832, did not progress.

However, on June 25 the DWC announced draft regulations and set up a forum for comment. In the announcement the DWC stated the following:

  • The draft regulations include:
    • A 25% increase in the multiplier for setting fees for evaluations.
    • Standardization of the fee that can be charged for a missed appointment.
    • Flat fees for comprehensive, follow-up and supplemental medical-legal evaluations.
    • Rates for review of medical records based upon the amount of pages reviewed.
    • Elimination of complexity factors from the Medical-Legal Fee Schedule.
    • An increase in the hourly fee for medical-legal testimony.

Also:

The implementation of a predominantly fixed fee for all procedure billing codes is anticipated to reduce frictional costs. Moving to a flat-fee-based schedule and removing complexity factors is contemplated to reduce the incidence of disputes over billing.

By the end of June 2020, there were extensive forum comments, many critical of the proposal. Here is my post The QME Fee Schedule Needs Work.

7. The insurance commissioner took some action to reduce premiums and exclude COVID claims from experience rating, but the effect of COVID on future workers’ comp costs and rates remained uncertain at midyear.

Insurance Commissioner Ricardo Lara ordered that certain COVID claims be excluded from experience rate calculations.

On June 17, Lara ordered new regulations to mandate that insurance companies recompute workers’ comp premium charges for policyholders to reflect pandemic-related reduced risk of loss as announced April 13, and as announced in a May 15 order.

The Workers' Compensation Insurance Rating Bureau did not make a midyear rate filing and announced that it would not file its 2021 pure premium rate filing until August. With chaos in the California economy, sky-high unemployment and many now working from home, the effect of COVID on workers’ comp rates and costs is unclear.

8. Aside from bills pertaining to COVID presumptions and proposed tweaks to AB 5, 2020 shaped up as a modest legislative year.

Bills to expand presumptions for post-traumatic stress disorder and skin cancer for certain law enforcement personnel failed to advance by midyear. SB 893, a bill to grant certain industrial presumptions to hospital employees who provide direct patient care, failed a key legislative committee vote.

The California Applicants' Attorneys Association's vision of bills “to reduce delays in care” and “eliminate bias in apportionment” did not materialize.

9. While 2020 has not shaped up to be a gangbuster year for workers' comp in the courts, there were some decisions that should be noted.

10. As always, there was a raft of studies looking at aspects of how the California system is performing.

As this post was being finished, the WCIRB published its 2020 State of the System report, perhaps the best source for an overview of trends in the California workers’ comp system.

Studies and reports often affect policy decisions, so stakeholders ignore them at their peril. Here are a few notable reports from the first half of 2020:

As California struggles to cope with the health and financial impact of COVID, it promises to be a challenging year for the workers’ comp system.

Julius Young is a claimants' attorney for the Boxer & Gerson law firm in Oakland. This column was reprinted with his permission from his blog, www.workerscompzone.com.

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