CVI The Fall of Saigon – This Time in Oakland

By: Publius

That strange sound you heard overhead a few weeks ago was choppers – a squadron of which descended recently, and with great stealth, over Oakland as part of a daring assault on the Division of Workers’ Compensation. An elite special ops team entered DWC offices and quickly neutralized the beleaguered staff – or maybe they just showed up on a furlough Friday – and soon hacked their way into the division’s computers. What happened next is the subject of an ongoing investigation; for much of the workers’ comp community remains flummoxed that out of the blue came regulations exempting air ambulances (including helicopters) from the official medical fee schedule.

No one seriously thinks the division had a hand in this. For one, it happened all too quickly. Second, had the division proposed these regulations, notices would have been required, such as requiring MPN notices to be posted inside the helicopters. Yet the proposed regulations are out there, a testament to recently acquired knowledge that some think the federal Airline Deregulation Act (ADA), enacted in 1978, prevents the division from deciding how air ambulances are to be paid.

More to the point, it prevents the Legislature from deciding how air ambulances are to be paid. And therein lies the problem. At the core of that industry’s argument is not that the division included such services in the fee schedule, it is that the Legislature failed to exclude them. No matter how cleverly couched the notion that this is simply a ratemaking proceeding, the fact is that the division has made the legal judgment, apparently after being briefed only by those most interested in increasing their profits from the workers’ comp system, that the Legislature did not intend these services to be included in the fee schedule when amending its authorizing provisions in Senate Bill 228 (Alarcon).


Sir, Will You Have Peanuts with That IV?

It is not as though a court has taken up this issue. Quite the contrary is the case. Proponents are appealing a judgment of dismissal in federal court after they sued most insurers and self-insured employers, claiming that payments only at the California fee schedule violated federal preemption. In fact, the air ambulance folks basically say that the fee for their services – whether needed or not – is whatever the market will bear. This is because ADA is supposed to do for air ambulances what it did for commercial passenger aviation.

In its rush to accommodate this airborne industry, DWC would be well served to review S. 1199 by Washington Senator Maria Cantwell (D). It’s called the Air Medical Service Safety Improvement Act of 2009. The debate over safety and use of air ambulances is heating up across the country. Even if ADA regulates rates charged by carriers, the division still has the authority to make sure these carriers conduct their business safely. It also doesn’t mean air ambulances are exempt from other workers’ comp requirements, such as their use being medically necessary and being subject to utilization review. The self-interested request by this industry – and the apparent self-interested regulatory response – present a unique opportunity to understand the way this industry works, its relationship with hospitals that have a financial interest in their use, the quality of medicine these services provide and whether their use is always in the best interest of the injured worker. Whether this is an opportunity lost remains to be seen, but given how this has been queued up, I’d say the last chopper is leaving the embassy pretty quickly.

PUBLISHERS' NOTE: Publius is written by a consortium of writers, sometimes internal, most frequently external. Workers' Comp Executive believes that it has the responsibility to air most viewpoints and welcomes the comments of its community on any subject. Publius does not necessarily represent the views of this publication.