GOVERNOR BROWN SIGNS INTERPRETER BILL (AB 1376)

AB 1376 got the support from Governor Brown it deserved when he signed it into law on the last day available to him -- we did not feel the bill needed to have been the cliffhanger that it turned out to be but, in the words of the bard, "all's well that ends well." Kudos go to many supporters who worked on the bill and to the sponsors of this legislation, particularly Jesse Ceniceros, Board Chair, Voters Injured at Work (VIAW). VIAW was the chief sponsor of this legislation that will enable injured workers to have access to interpreters during medical visits. The bill was one of equity, allowing the deadline for certification of interpreters to be extended to 1 March 2014. Why a bill that passed the last legislative step without opposition in the legislature and clearly had bipartisan support had to wait until the last day of the session for the Governor to sign it intrigues political pundits -- was it just political theater or was there serious backroom efforts to get a veto? It intrigues us. We'll be getting back to SB 863 soon, too -- that's the bill that enables Independent Medical Review to be done by doctors who aren't licensed in California, just like Utilization Review doctors. That's the bill that promised injured workers more than it delivered and embarrassed the California Labor Federation. That's the bill that Senator Beall sought to revise this year via SB 626 which got pulled midway through the session. We'll be poised to pounce if SB 626 comes back in January for the 2014 legislative session. Our editorial from this past summer remains available (see references below).

References

SB 626 (Beall) Tackles SB 863 (Deleon), www.politicsofhealthcare.com, 4/15/13

SB 626 (Beall) Restores Equity and Balance, ibid,  2/24/13

SB 626 Alert, ibid, 2/23/13

SENATE BILL 626 (BEALL) RESTORES EQUITY AND BALANCE TO WORKERS' COMP, THREATENS SB 863's STRANGLE HOLD ON WORKERS COMP

"HOW TO PRACTICE MEDICINE WITHOUT A LICENSE" WAS THE TITLE OF MY OP-ED IN THE SAN FRANCISCO CHRONICLE, 8/29/08.  The inequities described in that piece have been operative ever since -- but now Senator Beall's legislation, SB 626, will try to restore balance and equity. Comments from the Legislative Counsel's Digest, 2/22/13 include the following (italics):

"Existing law requires an employer to establish a medical treatment utilization review process and ... prohibits any person other than a licensed physician from modifying, delaying, or denying requests for authorization of medical treatment for reasons of medical necessity ... Existing law also provides for an independent medical review process to resolve disputes over a utilization review decision for injuries occurring on or after January 1, 2013,  and for any decision that is communicated ... after July 1, 2013 ...  This bill would revise these provisions to require that medical treatment reviews be conducted by physicians or medcal professionals ... who hold the same California license as the requesting physician (underlining added) ... Existing law prohibits a workers' compensation administrative law judge, the appeals board, or any higher court from making a determination of medical necessity contrary to the determinationn of the independent medical review organization ... This bill would delete that provision (underlining added)."

The current inequity is that under current law pursuant to SB 863 an Independent Medical Review (IMR) process is empowered to resolve disputes over utilization review for injuries occurring on or after 1 January 2013 and for decisions communicated to the requesting physician on or after July 1, 2013, regardless of the date of injury. In this way injured workers are deprived of diagnostic studies or treatment recommended by their Primary Treating Physicians (PTPs). The dispute then gets settled by the IMR process. Unfortunately, under current law,  neither the UR doctors nor their IMR counterparts need be licensed by the Medical Board of California. No matter how harmful or egregiously wrong their decisions are they are not subject to the same discipline as the PTPs all of whom are licensed in the states in which they practice.

The American Federation of State, County and Municipal Employees (AFSCME), AFL-CIO,  passed a resolution at its International Convention in Chicago in 2006. The resolution stated that "physicians working for utilization review companies reviewing the claims of injured workers be licensed in the states in which their decisions are used and where their decisions may influence the provision or denial of medical care to injured workers."

SB 626 would mandate that medical treatment reviews and independent medical reviews be done by physicians or medical professionals "who hold  the same California license as the requesting physician."

Incredibly, under current law, a cadre of secret doctors has been empowered. The names of the IMR doctors are "protected" by law, that means, concealed from view. Our previous blogs on SB 863 discuss this ablation of due process in more detail.

SB 626 would delete the requirement that that IMR doctors' names be kept secret.

California AFSCME's stand in favor of SB 863 was inadvertently a stand against its own organization's International Resolution. The political pressures to do so at the time were intense (Governor Brown wanted it -- see previous blogs re why).  We look forward to California's AFSCME coming on board SB 626.

Not only that. SB 863 actually prohibits due process and fair play because it prohibits workers' comp administrative law judges, the WCAB,  or even higher courts from making determinations of medical necessity that would set aside an IMR ruling against an injured worker. SB 626 would delete this provision.

More to follow. Stay tuned. But first, get on board -- readers may contribute their own comments on-line directly to this blog.

Here is a comment from CRIS FORSYTH, CHIEF OF STAFF, SENATOR JIM BEALL, DISTRICT 15: "Relative to your question regarding comments ... advocating for the bill.  I cannot fathom more eloquent prose than that which you have already professed."

Well, Cris, we'll do our best: SB 626 is courageous legislation that would restore honor to a process that has become the domain of insurance companies and their allies. It's also an American political anomaly that some parts of big labor identify more with business interests than with workers and would let injured workers be deprived of the medical and surgical treatment they need and heartfully believed they earned

SB 863 ALERT: WATCH FOR ASSAULT ON NON-CALIFORNIA LICENSED UTILIZATION REVIEW AND SO-CALLED INDEPENDENT MEDICAL REVIEWERS : Stay tuned to this blog. We expect to report incrementally from Sacramento as we learn what's happening in our Capitol.

Previous blogs discuss SB 863 which Governor Brown signed into law on the last possible day of the 2012 legislative session. Massive efforts by injured workers' interests to  alter this bill are expected. 

INDUSTRY JOURNAL PREDICTS $300 MILLION INCREASE IN WORKERS' COMP COSTS

$300 million -- that's what the Insurance Journal says will be the increased costs if SB 863 passes into law. That was the IJ headline on 8/27/12.

But in an article that was originally published in Labor's Edge and that got reprinted on 8/28/12 in California Progress Report,  Author Angie Wei, Legislative Director of the California Labor Federation, concluded that "there is no other path to getting $740 million back in benefits to injured workers. The Legislature must pass SB 863." But Angie isn't the only person who has fought for increased benefits to injured workers. Stan, who replied to her CPR piece, disagreed vehemently. I also disagree. Here's why:

1) The proposed legislation cuts costs by $1.4 billion, but only about 50% of that goes into Permanent Disability (PD). Who gets the rest?

2) The proposed legislation actually cuts several benefits that injured workers currently receive. For instance, we all know that Utilization Review (UR) as it's currently conducted is unfair to injured workers; however, UR decisions can be challenged under the current system. Under SB 863 the current UR system will be replaced by an Independent Medical Review (IMR) system which will be even more protected from challenges by injured workers who feel they were wrongly treated. This change will save $90 million in costs, costs that previously benefitted injured workers.

3) Outpatient surgery centers will have their reimbursement rate reduced to 80% of the hospital rate even when their services are superior. That'll save another $110 million. How does that benefit injured workers? The point is that the change to an IMR system when combined with the reduced reimbursement to outpatient surgery centers will cut costs by $200 million taken right out of the hearts and souls -- and bones -- of injured workers.

4) SB 863 will replace the antiquated but already low paying Official Medical Fee Schedule with an even lower paying Medicare RBRVS schedule which will apply mostly to specialists. Reducing access to specialty care does not help injured workers regain their ability to compete in the open market place.

5) SB 863 will eliminate sleep impairments (dyssomnia) caused by injuries that have caused chronic pain. The claim is that this change will save $40 million in benefits that won't be paid to injured workers.

6) SB 863 will eliminate sexual dysfunction even when caused by spinal injuries, a change that reportedly might save another $10 million. The savings for this category is lower because many injured workers are too embarrassed to assert this claim. These changes alone amount to $250 million in savings that'll be ripped from the guts of injured workers.  There are also other reductions.

7) LatinoComp stated the following in its own statement on SB 863: "All Injury Claims by State Employees Will Be Removed From The Workers Compensation System." This change amounts to a slap in the face with a simultaneous kick in the butt to injured workers.  The California Labor Federation and affiliated unions such as the American Federation of State, County and Municipal Employees (AFSCME) should be in staunch opposition to this plank.

So what's behind this  bill that Angie Wei reports "is not perfect?" We agree only that "the Schwarzenegger 'reform' has failed both employers and workers." Her piece says that one of the faults of SB 899 is that "medical treatment is delayed." That's true. But SB 863 makes sure that medical treatment will be delayed even more and more often denied than currently. Angie Wei's real beef appears to be "opposition from vendors (italics added) who profit from the status quo."  Vendors? Does that remark include the lawyers who represent injured workers and the doctors who care for them? If it does, we need to renegotiate. Come to think of it, comprehensive negotiations  including small employers and other stakeholders have been absent from the negotiating table from the beginning.  The answer is a special session after this legislative year. The special session should include all stakeholders, not just a selected few.

MINISCULE AMENDMENTS TO UNBALANCED WORKERS REFORM DRAFT IRRITATE BIG BUSINESS AND ITS BIGGEST LABOR ALLY 

An amended version to reform California's workers comp system has managed to irritate the Big Business proponents of the bill and the California Labor Federation at the same time. Here's how:  the proposed amendments leave matters regarding utilization review, independent medical review, medical provider networks, and lowered fee schedules for specialists nearly unscathed. The proposed new amendments make small adjustments for age and would now allow workers to factor age into permanent disability awards. Treatment options would be slightly increased because psychological claims would be considered and independent medical review decisions might in a few instances be able to be overturned. These miniscule changes are enough to send Big Business into a dither and to expose the involvement of the California Labor Federation in the now scorned, but not necessarily rejected, original super-unfair draft.

In fact, WorkCompCentral reported on 8/24/12 that the California Coalition on Workers Comp and the State Compensation Insurance Fund still support the original super-unfair version of the bill. Mirabile dictu (miracle to say), the Department of Industrial Relations was also reported to have endorsed the original super-unfair draft. Doctors' groups are divided between a position and no-position, e.g., the California Society of Industrial Medicine and Surgery (CSIMS) issued a powerful protest ("Oppose the Last Minute Backroom Deal on Workers' Compensation").

Efforts to get clear position statements one way or the other from other stakeholders such as the California Medical Association (CMA), the Union of American Physicians and Dentists (UAPD), and the American Federation of State, County and Municipal Employees (AFSCME) have so far not been productive. WorkCompCentral stated in its 8/24/12 statement that "Labor unions have not publicly expressed a position on the bill, but Angie Wie, legislative director for the California Labor Federation, was a key negotiator." 

Meanwhile, LatinoComp, unafraid and stalwart, has issued its own statement in opposition to the current omnibus workers comp draft: LatinoComp points out that the current draft indicates how "all injury claims by state employees will be removed from the workers compensation system." Our question is why would labor unions that represent state workers allow this travesty to occur unopposed?

Mark Priven, a public member of the Workers' Compensation Insurance Rating Bureau's Governing Committee, called these early assertions "sparse data or anecdotal information." The current draft is co-authored by Kevin de Leon which augurs ill for injured workers who need specialized care (compare SB 923 from 2011) and for the specialists trained to provide it. The other co-author is Jose Solorio. The current bill is numbered SB 863 and does not correct a myriad of inequities from the original draft. This bill has earned the right to be withdrawn and submitted for a special session after the  regular legislative session ends.

It appears that the Insurance Journal agrees. The IJ headline for 8/27/12 is "Workers' Comp Reform Bill Increases Costs $300M."

WORKERS COMP AMBUSH IN PROGRESS

WORKERS COMP AMBUSH sprung, well, almost!

Secretly, furtively, behind the proverbial closed doors that skilled political operatives deny exist, a carefully crafted bill has been sewn together by masters, namely, Angie Wei, legislative director of the California Labor Federation (CLF) and Sean McNally, vice president for corporate and government affairs at Grimmway Farms. The proposed legislation will boost profits for management groups while reducing access to specialty care for injured workers. CLF will justify the slashed medical benefit to injured workers by pointing out that the legislation will increase permanent disability benefits to injured workers by $700 million. CLF may not want to admit that the proposed legislation will also cut about $1.4 billion in costs in part by reducing access to specialty care. CLF may not disclose that many injured workers who need advanced or specialized medical care cease to become dues-paying union members. So what they think won't matter.

Voters Injured at Work (VIAW) takes particular offense at having the Official Medical Fee Schedule (OMFS) supplanted by the Medicare RBRVS. SB 923 (Deleon) failed last year but is still on the current agenda as a two-year bill. Its provisions are included in the current concoction that CLF and Grimmway have grimly crafted.  This column has already exposed who stands to benefit from SB 923 (see our glossary). This provision as either an independent bill or as part of a so-called reform package is designed to reduce payments to specialists, particulary focussing on procedures. Its design supposedly  increases payments to primary care physicans (PTPs) -- but neither SB 923 nor the so-called reform package tell you which management groups supporting these bills derive their income by charging management fees to PTP groups such as US Health Works. Hence, one of the beneficiaries is the management entities that deploy salaried physicians.

VIAW puts it this way: "Injured workers need both primary care physicians and specialists, but VIAW cannot support any proposal that funds an increase for one class of physicians at the expense of another."

The California Society of Industrial Medicine and Surgery (CSIMS) pointed out that "Unfortunately, the unions didn't ask any injured workers to help with the legislation and the large employers didn't ask small employers."

The Senate Republican Caucus stated that "the fact that insurers and non-unionized, non-self-insured/smaller employers are not at the negotiating table should be cause for some concern."

Not all stakeholders have fully displayed their own hands so far. We await up to date comment from the California Medical Association (CMA), the California Applicants Attorneys Association (CAAA), the Union of American Physicians and Dentists (UAPD), and the American Federation of State, County and Municipal Employees (AFSCME, AFL-CIO). We await action from physicians' specialty organizations such as the California Neurology Society (CNS filed a  letter against SB 923), and the professional groups that claim to represent other specialties such as the orthopedists, the physical medicine and rehab doctors, and specialists in pain management.

CMA's position on SB 923 is "oppose unless amended" while the UAPD's position is "watch." Watch what, we wonder?  Will CMA expand its "unless amended" statement and lobby legislative offices?

Next in line for concern and comment is Utilization Review. This column has already  discussed AB 1687 (Fong), supported by the UAPD and CSIMS (see our glossary again).  The reform package adds a new level of bureaucracy. The Labor Code would be altered such that treatment or medication disputes, including surgical options, would go to an Independent Medical Review (IMR). Like the current Utilization Review (UR) process, the IMR assignee would not interview or examine the patient, thereby preserving the worst part of the current UR process. The only grounds for appeal would be fraud, bias, or conflict of interest. We await commentary and action from CAAA on this method of protecting wrongul UR.

The outlook is for the complete ambush to be sprung at the end of the current legislative session. Will a hasty vote by many legislators who haven't been adequately briefed come down to a last minute trade-a-vote exchange?

References for further study

"Medical Development Trends in California Workers' Compensation, Accident Years, 2002-2010, California Workers Compensation Institute

"Medical Benefit Delivery in California Workers' Compensation, changes in Network Utilization and Reimbursement, 2004-2010, CWCI

"California Workers Compensation, 2012," prepared by Mark Gerlach, California Applicants' Attorneys Association, January, 2012

"Workers' Compensation Reform: Undoing the Damage of Schwarzenegger's Rules," March, 2012, California Labor Federation

"How to take away even more Care from Injured workers," Robert L. Weinmann, MD,  California Progress Report, 5 July 2011

"How to practice medicine without a license," Robert L. Weinmann, MD, San Francisco Chronicle, 8/29/08

"Utilization Review as a gift to insurance companies," Totalcapitol.com, Bob Weinmann, 3/11/12

"UR a battleground in Comp Reform, Greg Jones, Western Bureau Chief, workcompcentral.com, 5/25/12

"Reforms would cut $1.4B to fund $700M benefits increase,"  Greg Jones, Western Bureau Chief, 8/10/2012

"Deal on California workers' comp likely," Mark Lifsher, Los Angeles Times, 8/09/12

"Reform appears to be on its way to California's workers' compensation system once more," California Society of Industrial Medicine and Surgery, 8/09/12

AB 1687 (FONG) DESERVES PASSAGE INTO LAW

SB 923 (DELEON) DESERVES DEFEAT   

UTILIZATION REVIEW particularly by companies owned, controlled, or supported by insurance companies has been recognized for escalations of cost associated with wrongful denials of treatment. Here's how it works:
1) Josephine Sheetrock gets injured on the job and receives authorized initial treatment from a Primary Treating Physician (PTP) who in turn belongs to a Medical Provider Network (MPN) with which her employer and insurance company have a contract to provide care for injured workers (IWs);
2) Josephine Sheetrock's treatment does not resolve the clinical problem so the PTP seeks authorization for specialty consultation;
3) The PTP's request for authorization for specialty consultation and/or diagnostic tests is denied;
4) An authorization denial letter couched in the language of formal Utilization Review is sent to the PTP (it tells the doc to peddle his papers elsewhere);
5) The formal language is derived from the American Medical Association's Guides to the Evaluation of Permanent Impairment, from the American College of Occupational and  Environmental Medicine (ACOEM), and from the current Medical Treatment Utilization Schedule (MTUS), all usually correctly quoted while being wrongly applied;
6) The PTP can file an appeal. It the PTP files appeals too often or too successfully, the PTP risks being dropped from the MPN;
7) The consequence is that formal appeals are often perfunctory, not made at all, and are often unsuccessful (Josephine Sheetrock goes without treatment and is obliged to "go legal," i.e., to retain an attorney who specializes in workers compensation).

*** HMOs, other managed care organizations, and Knox-Keene Plans use similar mechanisms to delay or deny care. Money that should be allocated to patient care is retained by insurance companies, cooperative Utilization Review companies, and for enhanced executive compensation. 

*** AB 1687 (Fong) which applies to workers comp should be passed into law. It will help level the playing field by requiring full disclosure for denied care and by increasing access by injured workers  to lawyers who specialize in workers compensation;

*** SB 923 (Deleon) which also applies to workers comp should be defeated because it will deprive PTPs and their patients from access to specialty care. 

References

See our postings for 1 June 2012, 21 May 2012, and previous postings re workers compensation in http://www.politicsofhealthcare.com

Totalcapitol.com

California Progress Report

San Francisco Chronicle, 8/29/08 ("How to practice medicine without a license")

These articles include reviews of previous attempts to require California state licensure for UR doctors and are available on line, e.g., concerning AB 2968 (Lieber),  AB 933 (Fong), and AB 584 (Fong).

YES, re AB 1687 (Fong): it gives injured workers a fair chance!

According to the California Professional Firefighters (CPF) website this bill to make limited reforms in workers' compensation utilization review (UR) procedures will require that "communications about a delay, modification or denial of workers comp treatment would be required to include prominently displayed alternatives for the injured worker's next steps. In addition, if a related medical treatment dispute arises, and enforcement of a future medical award is required for continuing an injured worker's medical treatment, this bill allows the Workers Compensation Appeals Board to award reasonably-incurred attorney's fees in instances where an injured worker prevails in validating the medical award." We feel this bill is a step in the right direction so we recommend a yes vote.

Previously, we've crticized the bill because we felt it didn't go far enough since it doesn't require that doctors who do UR in California be licensed in California. As matters stand now, doctors with only Texas licenses may do UR in California whereas doctors with only California licenses cannot do UR in Texas. The California policy caters to insurance companies that use non-California doctors to issue UR denials -- that saves money for the insurance companies since they don't pay for treatment that has been denied by UR.

The overall loss to California in terms of fees and taxes is about $10,000,000 per year, a total of $30,000,000 when we take into account that Schwarzenegger vetoed this legislation twice and Brown, once. Protection of the insurance industry seems to be an area where Schwarzenegger and Brown agree.

Now comes Paul Fong with AB 1687 which would not require licensure in California but which would call for reasonable explanations of denial of care and that these denials of care be in clear and concise language.

Existing law requires that workers injured in the course of employment get indicated medical treatment and that they get compensated. Unreasonable denials of care are supposed to be subject to penalties and attorney fees. The trouble is that this requirement is commonly pushed aside while the two-year disability limit runs out. The current review process is not equitable because the degree to which UR doctors especially unlicensed ones are independent is questionable. In our view, the current system has already run roughshod over the workers' comp reforms embodied in SB 899, which many now feel was a shoddily written and hastily approved backroom agreement.

It's time to try again: it's time to give AB 1687 (Fong) a chance. If that doesn't work, we'll see about running a new licensure bill unless Fong and CPF decide to include such an amendment in AB 1687.

References

"How to practice medicine without a license," Robert L. Weinmann, San Francisco Chronicle, 8/29/08

"Utilization Review as a gift to insurance companies," TotalCapitol.com, posted by Bob Weinmann, 3/11/12

"Committee Passes Bill Authorizing Attorney Fees in UR Disputes," by Greg Jones, Western Bureau Chief, workcompcentral, 4/19/12

"Bills Target UR Denial," by Greg Jones, Western Bureau Chief, 3/20/12, workcompcentral, 3/20/12

"UR Data in Bill Analysis Highlights Need for Good Data," by Greg Jones, Western Bureau Chief, workcompcentral, 5/21/2012

"ACCOLADE FROM THE ASSOCIATION OF CALIFORNIA INSURANCE COMPANIES" IS AWARDED TO GOVERNOR BROWN

Goveror Brown and former Gov. Schwarzenegger have in common that both earned the gratitude and thanks of the insurance cartels. When the insurance companies learned that Gov. Brown vetoed anything and everything that might have lightened the burden for injured workers, their immediate response was to praise the Governor. Why not? He saved their bacon, didn't he?

Both Schwarzenegger and Brown ignored the opinion of the Medical Board of California, namely, that utilization review was an aspect of medical practice and that utilization review doctors whose decisions are used in California should be licensed in California. Texas doctors, unlicensed in California, may do utilization review in California whereas California doctors, if they're not licensed in Texas, may not do utilization review for injured workers in Texas.

It turns out that Governors may ignore the decisions of their states' professional boards. Not so for the accountants, dentists, nurses, physicians and tecnologists who are obliged to submit to the decisions of their professional boards.

Jason Schmelzer, Chief Lobbyist for the California Workers' Comp Coalition, glowingly said "there's room for the Governor to gloat. He did a fine job ... we think he did just fine."

Jesse Ceniceros, president of Voters Injured at Work, asked "what was the sense in replacing a Republican with a Democrat if he's just going to do what the Repubicans tell him to do? It's as though we didn't get rid of Schwarzenegger."

Right on, Jesse, we didn't. Both governors kow-towed to the insurance companies. Both governors earned and deserve the accolades heaped upon them by the insurance moguls. The injured worker community never saw it coming and didn't know what hit 'em until it was over. Denials of authorization for care will keep coming from doctors without California licenses as long as the use of carpetbagger doctors continues.

Interestingly, Gov. Brown used the Knox-Keene legislation as his model even though Knox-Keene has nothing to do with workers' comp. Brown said that requiring utilization review doctors to be licensed in California wasn't consistent with Knox-Keene. The California Society of Industrial Medicine and Surgery wrote Brown in September of 2011 that "merely because some Knox-Keene companies may be engaging in illegal activity without being prosecuted is not sufficient basis to condone it in workers' comp." To the best of our knowledge, Knox-Keene wasn't invented to make the lives of injured workers miserable. That cudgel was taken up by Schwarzenegger and is now surprisingly being wielded by Brown.

It may've been a politically advantageous move for Schwarzenegger from whom fair and equitable treatment of injured workers wasn't expected. We'd expected better from Brown.