EK HEALTH

by Steve Kline, Esq.
EK Health Services' Legal Counsel

One of the major tenets of the 2004 reforms was the creation of Medical Provider Networks (MPN).  The expectation was that with employer created MPNs, uncontrolled & costly medical treatment would be lessened and many of the medical treatment mills would be curtailed.

Over the past years, MPNs, for a multitude of reasons, have not delivered what was promised, as medical care is still a predominant cost driver in workers' compensation. Part of this is due to how some applicant attorneys have disregarded the statutory and regulatory requirements by pulling their clients out of the MPN.  Often this has gone unchallenged at the Workers' Compensation Appeals Board (WCAB).

On April 20, 2011, the WCAB issued its second en banc decision in 2011, Valdez v Warehouse Demo Services (75 Cal Comp Cases _____ ).  The question presented was, if an injured worker treats outside of a validly established and properly noticed MPN, are those medical reports admissible?

The WCAB Commissioner held, “that where unauthorized treatment is obtained outside a validly established and properly noticed MPN, reports from the non MPN doctors are inadmissible, and therefore may not be relied upon, and the defendant is not liable for the cost of the non MPN reports.”

The facts of the case are all too familiar.

The injured worker had an accepted claim.  She treated for less than 30 days, when she became dissatisfied with the treatment being provided by the MPN doctor.  Without the knowledge of the employers or the claims department, and upon the advice of her attorney, she transferred her care to a doctor who was selected by her attorney who was outside of the MPN.  The non-MPN doctor reported that she was temporarily disabled which was contested by the defense.

The matter came up for trial on the issue of temporary disability (TD).  The applicant put the non-MPN physician’s reports into evidence.   The defense countered that they were inadmissible as the physician was outside the MPN.  The Workers' Compensation Judge (WCJ) put that issue aside and only focused on the TD.

The WCJ found that the applicant was temporarily disabled from November 2, 2009 through February 10, 2009.  This was based upon the report from the non MPN doctor which the judge allowed to be admitted into evidence.

Reconsideration was granted and the WCAB Commissioners in a split vote took a different view.  

First they assumed that the MPN was validly established and properly noticed. The majority (5 Commissioners) wrote that the injured worker who was dissatisfied with her treatment had several options, none of which she exercised. These options included the second, third and fourth opinion process that was part of the statutory requirements of an MPN plan.
In addition the injured worker failed to exercise her rights under Labor Code § 4616.3(a) which states that she had an absolute right after the first visit by the employer selected MPN physician to select any other provider from within the MPN.

Consequently, they decided, that the medical report came from a doctor who could not be her primary treating physician and was inadmissible for any purpose. The Commissioner went even further and indicated that the employer was not responsible for the payment of this bill as it was outside the MPN.

The Commissioners rescinded the findings and award and remanded the case back to a new trial judge for a decision as to whether the MPN had been validly established and whether it had provided the proper notices. If MPN met those standards, then the temporary disability issue should be resolved through the Labor Code §4062 process.

For those who have properly established MPNs, this decision supports their actions.

Attorney, Richard M. Jacobsmeyer, in an article in the LexisNexis community blog, called this is an important case for the promotion of MPNs.  He stated, “needless to say a critical part of this decision is the ability of the employer to prove a properly implemented MPN.  Such proof requires the employer provide affirmative evidence regarding sending of MPN notices and posting of notices under Labor Code § 3550.”

For MPNs who want to keep the injured worker within the MPN, with this decision, the shift will be to make sure that the employers and the MPN developers have documented evidence of the MPN’s establishment, and that proper notices have been delivered to the employees.

Finally, there has been a solid opinion that validates the Medical Provider Network system.  Most certainly this case will be appealed to the Court of Appeal.  However, until a decision from that Court is announced, this decision is the law of the workers' compensation system and binding on all trial judges throughout the state.

Thank you for attention.