Utilization Review

Calif. Case Could Redefine Peer Review

A lawsuit being argued in California could drastically change UR workers' comp statutes and drive costs through the roof.
By: | January 27, 2017 • 4 min read

A case in the California Supreme Court could disrupt the state’s workers’ compensation medical treatment approval process and expose utilization review doctors to medical malpractice liability, said California attorneys on both sides of the issue.

“The entire workers’ compensation community should take notice,” said Mike Lemrick, senior director, operations utilization review and IME at Coventry, because “although the high court is unlikely to uphold the appellate court’s decision, the consequences would turn the workers’ comp process upside down.”

The civil case in question is Kirk King v. CompPartners Inc. et al., in which a husband and wife sued a utilization review (UR) company, CompPartners Inc., and two of its employee physicians, primarily for medical malpractice.

Bernie Baltaxe, partner, Smith & Baltaxe, LLP

King suffered a back injury in 2008, and his treating physician prescribed the sedative Klonopin for depression and anxiety related to chronic pain. Two years later, a CompPartners utilization review physician, an anesthesiologist, determined the Klonopin was medically unnecessary.

When the CompPartners physician decertified the Klonopin, King was obliged to stop taking it or pay for it out of pocket. King’s suit alleged that his sudden withdrawal resulted in four seizures, which in turn resulted in additional physical injuries.

The trial court sided with CompPartners, and the Court of Appeals partially reversed the lower court’s decision. The decision to decertify was within the exclusive jurisdiction of workers’ compensation, said Bernie Baltaxe, partner, Smith & Baltaxe, LLP, a San Francisco law firm specializing in workers’ compensation cases, but the failure to warn was not.

Baltaxe, who filed a brief on the case on behalf of the California Applicants’ Attorneys Association, said the case is noteworthy because it raises questions about:

  • Duty of care for UR doctors
  • The exclusive remedy of workers’ compensation
  • The UR process and preemption

Who Bears Duty of Care?

Among the reasons this is a significant case, Lemrick said, is that it establishes a doctor-patient relationship with the UR peer reviewer.

Advertisement




Contrary to the appellate court’s findings, he said, UR doctors’ role is not a doctor-patient relationship and so is not subject to duty of care obligations. Instead, their role is limited to “certifying, modifying, or denying treatment per medical treatment guidelines as established by the state.”

“The UR doctor never treats the injured worker or sees the entire medical file,” he said, only those the treating physician provides for episodic review of a specific treatment.

“The UR doctor isn’t allowed to make a diagnosis, a treatment plan or provide alternate treatments.”

“If upheld, it would drastically change the UR workers’ comp statutes and allow civil tort duties. It would change workers’ comp as we know it.” — Mike Lemrick, senior director, operations utilization review and IME, Coventry

Baltaxe disagrees. “When a physician is engaged in medicine and renders a professional opinion that affects treatment,” he said, “there’s a doctor-patient relationship.”

For purposes of malpractice, the court indicated that an essential element of a cause of action for malpractice is the existence of a doctor-patient relationship in order to give rise to a duty of care.

In this case, Lemrick said, “I believe the treating physician bore responsibility for the medical treatment and withdrawing King from Klonopin.”

That decision was made by the UR doctor, Baltaxe said. “There’s no methodology for the treating physician to ask for time to wean.” An appeal can take months, and an abrupt cessation of Klonopin can results in seizure in the first few days.

The UR doctors did, in fact, have a duty to warn, Baltaxe said. “When physicians make a medical recommendation, they’re required to warn of potential side effects. They also have obligation to not take action that will cause harm.”

Failure to warn does not fall within the exclusive remedy or workers’ compensation, he said, and injured workers should be permitted to seek legal recourse outside workers’ compensation statutes.

Workers’ Comp As We Know It

This could be a source of chaos and confusion in California, Lemrick said. If the appellate court’s decision is upheld, he said, “it will be more costly for companies do business in California because UR costs will go through the roof.”

Mike Lemrick, senior director, operations utilization review and IME, Coventry

If the duty of care for physicians who never sees a patient is upheld, all physician reviewers will require extra liability and malpractice insurance. “It will drive workers’ comp costs higher for California and delay care for injured workers,” Lemrick said.

Will the high court’s decision spill over to other states?

Absolutely, said Baltaxe. “Until this case came along, I hadn’t heard of any workers’ comp doctor immunized against negligence.”

Hopefully, he said, the state Supreme Court will rule that the decision to abruptly stop Klonopin does not fall within the exclusive remedy and that the doctor failed in his duty to warn. “All states should take notice.”

Lemrick is equally confident in the reverse outcome.

“If upheld,” he said. “It would drastically change the UR workers’ comp statutes and allow civil tort duties. It would change workers’ comp as we know it.”

Susannah Levine writes about health care, education and technology. She can be reached at [email protected]

More from Risk & Insurance

More from Risk & Insurance

Absence Management

Establishing Balance With Volunteers

It’s good business to allow job-leave for volunteer emergency responders, whether or not state laws apply.
By: | January 10, 2018 • 7 min read

If 2017 had a moniker, it might be “the year of the natural disasters,” thanks to a phenomenal array of catastrophic or severe events— hurricanes, tornadoes, wildfires, ice storms and floods.

Advertisement




Combined with smaller-scale fires and other emergencies, these incidents tax the resources of local and state emergency services, often prompting the need to call volunteer emergency responders into action.

But as lean as most organizations are already running, volunteer activities can sometimes cause friction between employees and employers. Handling conflicts the wrong way can potentially lead to legal headaches, harm employee morale and batter a company’s reputation.

State by State Variations

Most employers are aware of the various federal and state leave laws protecting their employees, including family and medical leave, pregnancy leave and military leave. But leave laws that protect the livelihoods of volunteer emergency responders are more likely to fly under the radar of some HR managers and risk managers.

Such laws don’t exist in every state, but more than 20 states do have some type of law in place to protect volunteers including emergency responders, firefighters, disaster workers, medical responders, ambulance drivers or peace officers.

Marti Cardi, vice president of Product Compliance for Matrix Absence Management

The laws vary broadly. Nearly all specify that such leave be unpaid, and that employees disclose their volunteer status to employers and provide documentation for each leave. But there is a spectrum of variations in terms of what may trigger an eligible leave. Some, for instance, apply for any emergency that prompts a call from the volunteer’s affiliated responder group. Others may require a government declaration of emergency for the law to be triggered.

While many of the laws do not explicitly require employers to let employees leave work when called to an emergency during a shift, most specify that an employee may be late or even miss work entirely without facing termination or any other adverse employment action.

Some states mandate a maximum number of unpaid leave days that a volunteer can claim. But others may place more significant burdens on employers. In California, for instance, employers with 50 or more employees are required to grant up to 14 days of unpaid leave for training activities in addition to any leave taken to respond to emergency events. For multistate employers, keeping on top of what obligations may apply in each circumstance can be a challenge.

Significant Risks

Large or mid-sized employers may rely on absence management providers to keep them in compliance. For smaller employers though, it may be as simple as looking up a state’s law via Google to find out what’s required. However, checking in with the state department of labor or the company’s attorney may be the best way to get the correct facts.

“I would caution that just because you don’t find something [on the internet], it doesn’t mean it’s not there,” said absence management and employment law attorney Marti Cardi, vice president of Product Compliance for Matrix Absence Management.

For example, Cardi said, an obscure Texas law provides job-protected leave for volunteer ham radio operators called into service during an emergency.

Cardi said employers should task HR to investigate the laws in each state the company operates in, and to ensure that supervisors are educated about the existence of these laws.

“If a supervisor is told by one of his or her employees, ‘Sorry I’m not coming in today … I’ve been called to volunteer firefighter duty for the [nearby region] fire,’” she said, you want to be sure that the supervisor knows not to take action against the employee, and to contact HR for guidance.

“Training supervisors to be aware of this kind of absence is really important.”

Advertisement




An employer that does terminate a protected volunteer for responding to an emergency may be ordered to pay back wages and reinstate the employee. In some cases, the employee may also be able to sue for wrongful termination.

And of course, “you don’t want to be the company in the headlines that is getting sued because you fired the volunteer firefighter,” she added.

If an employer bars a volunteer from responding, the worst-case scenario may be a third-party claim. Failure to comply with the law could give rise to a claim along the lines of “‘If you had complied with your statutory obligation to give Jane Doe time to respond, my loved one would not have died,’” explained Philadelphia-based Jonathan Segal, partner at law firm Duane Morris and managing principal of the Duane Morris Institute.

“That’s the claim I think is the largest in terms of legal risk.”

Even if no one dies or is seriously injured, he added, “there could still be significant reputational risk if an individual were to go to the media and say, ‘Look, I got called by the fire department and I wasn’t allowed to go.’”

The Right Thing to Do

What employers should be thinking about, Segal said, is that whether or not you have a legal obligation to provide job-protected leave for volunteer responders, “there’s still the question of what are the consequences if you don’t?”

Employee morale should be factored in, he said. The last thing any company wants is for employees to perceive it as insensitive to their interests or the interests of the community at large.

“Sometimes employers need to go beyond the law, and this is one of those times,” — Jonathan Segal, partner, Duane Morris; managing principal, Duane Morris Institute

“How is this going to resonate with my employees, with my workforce, how are people going to see this? These are all relevant factors to consider,” he said.

There’s an argument to be made for employers to look at the bigger picture when it comes to any volunteer responders on their payroll, said Segal.

“Sometimes employers need to go beyond the law, and this is one of those times,” he said. “Think about the case where’s there’s not a specific state law [for emergency responders] and you say to a volunteer, ‘No, you can’t leave to deal with this fire’ and then people die. You as an employer have potentially played a role, indirectly, because you didn’t allow the first responder or responders to go,” he said.

The bottom line is that “it’s the right thing to do, even if it’s not required by law,” agreed Cardi.

“I feel that companies should have a policy that they’re not going to discipline or discharge someone for absences due to this kind of civic service, subject to verification of course.”

Clear Policy

While most employers do strive to be good corporate citizens, it goes without question that employers need to guard their own interests. It’s not especially likely that volunteer responders will try to take advantage of the unpaid leave allowed them, but of course, it could happen.

That’s why it’s important to have policies that are aligned with state laws. Those policies could include:

  • Notifying the company of any volunteer affiliations either upon hire or as soon they are activated as volunteers.
  • Requiring that employees notify a supervisor as soon as possible if called to an emergency (state requirements vary).
  • Requiring documentation after the event from the head of the entity supervising the volunteer’s activities.

If at some point it becomes excessive – someone has responded to emergencies five times in nine weeks, then it’s time to examine the specifics of the law and have a discussion with the employee about what’s reasonable, said Segal. It may also be time to ask specifics about whether the person is volunteering each time, or are they being called.

Advertisement




In some cases, the discussion may need to be about finding a middle ground, especially if an employee has taken on an excessively demanding volunteer role.

“We encourage volunteers to pick the style that best fits their schedule,” said Greta Gustafson, a representative of the American Red Cross. “Disaster volunteers can elect to respond to disasters locally, nationally, or even virtually, and each assignment varies in length — from responding overnight to a home fire in your community to deploying across the country for several weeks following a hurricane.

“The Red Cross encourages all volunteers to talk with their employers to determine their availability and to communicate this with their local Red Cross chapter.”

Segal suggests approaching it as an interactive dialogue — borrowing from the ADA. “Employers may need to open a discussion along the lines of ‘I need you here this week because this week we have a deliverable on Friday and you’re critical to that client deliverable,’” he said, but also identify when the employee’s absence would be less critical.

No doubt there will be tough calls. An employer may have its hands full just trying to meet basic customer needs and need all hands on deck.

“That may be a situation where you say, ‘First let me check the law,’” said Segal. If there’s a leave law that applies, “then I’m going to need to comply with it. If there’s not, then you may need to balance competing interests and say, ‘We need you here.’” &

Michelle Kerr is associate editor of Risk & Insurance. She can be reached at [email protected]