Not Quite The Dog Days

By: Mark Webb

July can often be thought of as a quiet time for those who observe the workers’ compensation system in California. The Legislature rushed through Committee deadlines before going on summer recess and most of the work product now resides in Appropriations Committees. While there is always the chance for drama in the last few weeks of session in mid-August, the effective dispatching of two seriously disruptive bills; Assembly Bill 1465 (Reyes) and Senate Bill 335 (Cortese) make a last-minute surprise less likely to happen.


There are a few items of note, however, warranting discussion. In chronological order, July 1st was the effective date of two important changes intended to provide more transparency in the access to and delivery of medical care. These changes came about when Senate Bill 537 (Hill) was chaptered in 2019. The first requires every medical provider network (MPN) to post on its internet website a roster of all participating providers, which includes all physicians and ancillary service providers in the MPN, and must update that roster at least quarterly.


The second requires an entity providing physician or ancillary network services to provide a payor with a written disclosure of the reimbursement amount paid to the provider with a rate sheet if a contracted reimbursement rate is more than twenty percent below the official medical fee schedule. The disclosure form was promulgated by the Division of Workers’ Compensation and made available on July 1.


Whether these two changes lessen the complaints regarding timely access to care and the practice of discounting fees paid to medical providers remains to be seen. It is more likely the debate will continue next year, but perhaps with variations on these long-running themes.


Then there is July 5th. For most people, this was the official Independence Day holiday. It also is the one-year anniversary of the end of Governor Newsom’s Executive Order N-62-20, establishing a rebuttable presumption for determining when a COVID-19 infection arose out of and in the course of employment. The next day, July 6, is the one-year anniversary of the beginning of the workers’ compensation COVID presumptions in Senate Bill 1159 (Hill). These presumptions will end January 1, 2023, if the Legislature does not extend it next year.


How the COVID-19 presumptions affect the workers’ compensation claims environment remains to be seen. Certainly, SB 1159 compels employers to acquire considerable data on workers and send that information to their claims administrator. The testing and outbreak requirements for private-sector workers are complicated as well.


As of July 2021, the many and varied issues raised by the complex presumption laws have not been the subject of Workers’ Compensation Appeals Board interpretation. The impact of COVID on claims administration, an assessment that involves more than the presumptions in SB 1159, will be part of a larger investigation undertaken by RAND at the behest of the Commission on Health and Safety and Workers’ Compensation. The first iteration of that report is required to be delivered by the end of the year.


Summer recess for the California Legislature commenced July 16th. Legislators will return one month later. But while things may be quiet in Sacramento for the remainder of July, rest assured that on any given day in this system, something of consequence can always happen.


Note: The opinions expressed herein may or may not be those of Workers’ Comp Executive. Mark Webb is a former Arizona insurance regulator, insurance company chief compliance officer, and is an expert in corporate governance, risk and compliance. He is the owner of Prop 23 Advisors.