Employers and workers' comp carriers who wish to challenge a medical treatment request have only one avenue to do so and that is through the utilization review process, says the California Supreme Court (State Compensation Insurance Fund v. Workers' Compensation Appeals Board and Brice Sandhagen). The decision denied State Fund a second bite at the apple to deny an injured worker's medical treatment request.

The court made it clear that under state law only an injured worker—not an employer or insurer—is able to initiate the medical dispute resolution process outlined in Labor Code section 4062. Earlier the Workers' Compensation Appeals Board and the Third District Court of Appeal had said State Fund could initiate such a challenge after it failed to meet the statutory deadlines outlined in section 4610 which governs the utilization review process.

"In light of the clear statutory language and the Legislature's purpose in enacting the utilization review process in section 4610, we conclude the Legislature intended to require employers to conduct utilization review when considering employees' requests for medical treatment. Employers may not use section 4062 as an alternative method for disputing employees' treatment requests," Justice Carlos Moreno wrote in the court's unanimous opinion.

Timeliness Rules

In the case, Brice Sandhagen sustained neck, back, elbow and wrist injuries in an industrial accident. His treating physician submitted a request for an MRI to determine if disk herniations or disc degeneration was causing Sandhagen's pain. State law requires a written response within five-days, but gives an employer up to 14 days under certain circumstances to "review and approve, modify, delay or deny" a request. State Fund's utilization review physician took 28 days to issue his denial.

Noting the late response, the workers' compensation judge threw out the treatment denial. On appeal, the WCAB held that the deadlines in section 4610 are mandatory and that State Fund's failure to meet them precluded it from challenging the treatment request through UR. However, it reasoned that State Fund could still dispute the treating physician's treatment recommendation through the 4062 process.

The Supreme Court disagreed pointing out that the "Legislature made clear that an employer may not use section 4062 to object to a medical determination concerning medical issues 'subject to section 4610'". By passing SB 899 and rewriting section 4062, the Legislature eliminated the statement that employers could use the section to object to the "extent and scope of medical treatment..." under 4062.

"State Fund would have us read 'the extent and scope of medical treatment' back into the statute as one of the matters employers may object to under section 4062. We decline to do so," the court wrote.

Speedier UR Process

The decision will be a "big help" in reducing treatment delays for the majority of injured workers', says Marguerite Sweeney, the attorney who successfully argued the case before the Supreme Court, adding that the decision should also prove helpful to carriers and employers.

"Carriers now have the clarification they've needed from the Supreme Court so they can take a look at their utilization review procedures and hopefully be able to adjust those accordingly," she said noting that not every request has to go out for medical utilization review. "Utilization review also includes screening and approving treatment requests by the claims adjustors."

"Utilization review also includes screening and approving treatment requests by the claims adjustors." – Marguerite Sweeney, attorney for Sandhagen

To this end the court made clear in the opinion that "if the treatment request is straightforward and uncontroversial, the employer can quickly approve the request—utilization review is completed without any need for additional medical review of the request." Only more complicated requests that might result in a modification, delay or denial have to be review by a physician, the court noted.

And in a concurring opinion, Justice Joyce Kennard elaborated on her views on the interplay between the two labor code sections. "Section 4610's utilization review does not supplant section 4062's dispute-resolution process; rather, it adds a new threshold step to that process," Kennard wrote. "It can only be said to supplant that process in the practical sense—that is, it might prevent some disputes from ever arising, thereby making resort to that process unnecessary."

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