AB 221: Workers' compensation: liability for payment.
- Session Year: 2017-2018
- House: Assembly
- Latest Version Date: 2017-01-25
Existing law establishes a workers compensation system, administered by the Administrative Director of the Division of Workers Compensation, that generally requires employers to secure the payment of workers compensation for injuries incurred by their employees that arise out of, or in the course of, employment. Existing law requires an employer to provide all medical services reasonably required to cure or relieve the injured worker from the effects of the injury.
This bill would provide that for claims of occupational disease or cumulative injury filed on or after January 1, 2018, the employee and the employer would have no liability for payment for medical treatment unless one or more of certain conditions are satisfied, including, among others, that the treatment was authorized by the employer.
Existing law authorizes the Workers Compensation Appeals Board to determine, and allow as a lien against any sum to be paid as compensation, certain expenses.
This bill would provide that for claims of occupational disease or cumulative injury filed on or after January 1, 2018, the employer shall not be liable for the payment of any lien for medical treatment unless one of the conditions described above is satisfied, or the parties agree to a settlement by compromise and release and the amount of the compromise and release, exclusive of the cost of medical treatment, is $25,000 or more.
(a)Medical, surgical, chiropractic, acupuncture, and hospital treatment, including nursing, medicines, medical and surgical supplies, crutches, and apparatuses, including orthotic and prosthetic devices and services, that is reasonably required to cure or relieve the injured worker from the effects of his or her injury shall be provided by the employer. In the case of his or her neglect or refusal reasonably to do so, the employer is liable for the reasonable expense incurred by or on behalf of the employee in providing treatment.
(b)As used in this division and notwithstanding any other law, medical treatment that is reasonably required to cure or relieve the injured worker from the effects of his or her injury means treatment that is based upon the guidelines adopted by the administrative director pursuant to Section 5307.27.
(c)Unless the employer or the employers insurer has established or contracted with a medical provider network as provided for in Section 4616, after 30 days from the date the injury is reported, the employee may be treated by a physician of his or her own choice or at a facility of his or her own choice within a reasonable geographic area. A chiropractor shall not be a treating physician after the employee has received the maximum number of chiropractic visits allowed by subdivision (c) of Section 4604.5.
(d)(1)If an employee has notified his or her employer in writing prior to the date of injury that he or she has a personal physician, the employee shall have the right to be treated by that physician from the date of injury if the employee has health care coverage for nonoccupational injuries or illnesses on the date of injury in a plan, policy, or fund as described in subdivisions (b), (c), and (d) of Section 4616.7.
(2)For purposes of paragraph (1), a personal physician shall meet all of the following conditions:
(A)Be the employees regular physician and surgeon, licensed pursuant to Chapter 5 (commencing with Section 2000) of Division 2 of the Business and Professions Code.
(B)Be the employees primary care physician and has previously directed the medical treatment of the employee, and who retains the employees medical records, including his or her medical history. Personal physician includes a medical group, if the medical group is a single corporation or partnership composed of licensed doctors of medicine or osteopathy, which operates an integrated multispecialty medical group providing comprehensive medical services predominantly for nonoccupational illnesses and injuries.
(C)The physician agrees to be predesignated.
(3)If the employee has health care coverage for nonoccupational injuries or illnesses on the date of injury in a health care service plan licensed pursuant to Chapter 2.2 (commencing with Section 1340) of Division 2 of the Health and Safety Code, and the employer is notified pursuant to paragraph (1), all medical treatment, utilization review of medical treatment, access to medical treatment, and other medical treatment issues shall be governed by Chapter 2.2 (commencing with Section 1340) of Division 2 of the Health and Safety Code. Disputes regarding the provision of medical treatment shall be resolved pursuant to Article 5.55 (commencing with Section 1374.30) of Chapter 2.2 of Division 2 of the Health and Safety Code.
(4)If the employee has health care coverage for nonoccupational injuries or illnesses on the date of injury in a group health insurance policy as described in Section 4616.7, all medical treatment, utilization review of medical treatment, access to medical treatment, and other medical treatment issues shall be governed by the applicable provisions of the Insurance Code.
(5)The insurer may require prior authorization of any nonemergency treatment or diagnostic service and may conduct reasonably necessary utilization review pursuant to Section 4610.
(6)An employee shall be entitled to all medically appropriate referrals by the personal physician to other physicians or medical providers within the nonoccupational health care plan. An employee shall be entitled to treatment by physicians or other medical providers outside of the nonoccupational health care plan pursuant to standards established in Article 5 (commencing with Section 1367) of Chapter 2.2 of Division 2 of the Health and Safety Code.
(e)(1)When at the request of the employer, the employers insurer, the administrative director, the appeals board, or a workers compensation administrative law judge, the employee submits to examination by a physician, he or she shall be entitled to receive, in addition to all other benefits herein provided, all reasonable expenses of transportation, meals, and lodging incident to reporting for the examination, together with one day of temporary disability indemnity for each day of wages lost in submitting to the examination.
(2)Regardless of the date of injury, reasonable expenses of transportation includes mileage fees from the employees home to the place of the examination and back at the rate of twenty-one cents ($0.21) a mile or the mileage rate adopted by the Director of Human Resources pursuant to Section 19820 of the Government Code, whichever is higher, plus any bridge tolls. The mileage and tolls shall be paid to the employee at the time he or she is given notification of the time and place of the examination.
(f)When at the request of the employer, the employers insurer, the administrative director, the appeals board, or a workers compensation administrative law judge, an employee submits to examination by a physician and the employee does not proficiently speak or understand the English language, he or she shall be entitled to the services of a qualified interpreter in accordance with conditions and a fee schedule prescribed by the administrative director. These services shall be provided by the employer. For purposes of this section, qualified interpreter means a language interpreter certified, or deemed certified, pursuant to Article 8 (commencing with Section 11435.05) of Chapter 4.5 of Part 1 of Division 3 of Title 2 of, or Section 68566 of, the Government Code.
(g)If the injured employee cannot effectively communicate with his or her treating physician because he or she cannot proficiently speak or understand the English language, the injured employee is entitled to the services of a qualified interpreter during medical treatment appointments. To be a qualified interpreter for purposes of medical treatment appointments, an interpreter is not required to meet the requirements of subdivision (f), but shall meet any requirements established by rule by the administrative director that are substantially similar to the requirements set forth in Section 1367.04 of the Health and Safety Code. The administrative director shall adopt a fee schedule for qualified interpreter fees in accordance with this section. Upon request of the injured employee, the employer or insurance carrier shall pay for interpreter services. An employer shall not be required to pay for the services of an interpreter who is not certified or is provisionally certified by the person conducting the medical treatment or examination unless either the employer consents in advance to the selection of the individual who provides the interpreting service or the injured worker requires interpreting service in a language other than the languages designated pursuant to Section 11435.40 of the Government Code.
(h)Home health care services shall be provided as medical treatment only if reasonably required to cure or relieve the injured employee from the effects of his or her injury and prescribed by a physician and surgeon licensed pursuant to Chapter 5 (commencing with Section 2000) of Division 2 of the Business and Professions Code, and subject to Section 5307.1 or 5703.8. 5307.8. The employer shall not be liable for home health care services that are provided more than 14 days prior to the date of the employers receipt of the physicians prescription.
(i)For claims of occupational disease or cumulative injury filed on or after January 1, 2018, the employee shall have no liability for payment for medical treatment and the employer shall have no liability for payment for medical treatment unless one or more of the following has occurred:
(1)The treatment was authorized by the employer.
(2)The injury to the body part or body parts for which the treatment was provided has been accepted by the employer.
(3)The appeals board, after an evidentiary hearing or stipulation of the parties, finds the injury to the body part or body parts for which the treatment was provided was compensable.
(4)The employee has undergone an evaluation by a qualified medical examiner, pursuant to Section 4600, or an agreed medical examiner and the evaluating physician has determined that the claimed occupational disease or cumulative injury was caused, in whole or in part, by the employment.
SEC. 2.Section 4903.1 of the Labor Code is amended to read:4903.1.(a)The appeals board or arbitrator, before issuing an award or approval of any compromise of claim, shall determine, on the basis of liens filed with it pursuant to Section 4903.05, whether any benefits have been paid or services provided by a health care provider, a health care service plan, a group disability policy, including a loss-of-income policy or a self-insured employee welfare benefit plan, and its award or approval shall provide for reimbursement for benefits paid or services provided under these plans as follows:
(1)If the appeals board issues an award finding that an injury or illness arises out of and in the course of employment, but denies the applicant reimbursement for self-procured medical costs solely because of lack of notice to the applicants employer of his or her need for hospital, surgical, or medical care, the appeals board shall nevertheless award a lien against the employees recovery, to the extent of benefits paid or services provided, for the effects of the industrial injury or illness, by a health care provider, a health care service plan, a group disability policy or a self-insured employee welfare benefit plan, subject to the provisions described in subdivision (b).
(2)If the appeals board issues an award finding that an injury or illness arises out of and in the course of employment, and makes an award for reimbursement for self-procured medical costs, the appeals board shall allow a lien, to the extent of benefits paid or services provided, for the effects of the industrial injury or illness, by a health care provider, a health care service plan, a group disability policy or a self-insured employee welfare benefit plan, subject to the provisions of subdivision (b). For purposes of this paragraph, benefits paid or services provided by a self-insured employee welfare benefit plan shall be determined notwithstanding the official medical fee schedule adopted pursuant to Section 5307.1.
(3)(A)If the appeals board issues an award finding that an injury or illness arises out of and in the course of employment and makes an award for temporary disability indemnity, the appeals board shall allow a lien as living expense under Section 4903, for benefits paid by a group disability policy providing loss-of-time benefits and for loss-of-time benefits paid by a self-insured employee welfare benefit plan. The lien shall be allowed to the extent that benefits have been paid for the same day or days for which temporary disability indemnity is awarded and shall not exceed the award for temporary disability indemnity. A lien shall not be allowed hereunder unless the group disability policy or self-insured employee welfare benefit plan provides for reduction, exclusion, or coordination of loss-of-time benefits on account of workers compensation benefits.
(B)For purposes of this paragraph, self-insured employee welfare benefit plan means any plan, fund, or program that is established or maintained by an employer or by an employee organization, or by both, to the extent that the plan, fund, or program was established or is maintained for the purpose of providing for its participants or their beneficiaries, other than through the purchase of insurance, either of the following:
(i)Medical, surgical, or hospital care or benefits.
(ii)Monetary or other benefits in the event of sickness, accident, disability, death, or unemployment.
(4)If the parties propose that the case be disposed of by way of a compromise and release agreement, in the event the lien claimant, other than a health care provider, does not agree to the amount allocated to it, then the appeals board shall determine the potential recovery and reduce the amount of the lien in the ratio of the applicants recovery to the potential recovery in full satisfaction of its lien claim.
(b)Notwithstanding subdivision (a), payment or reimbursement shall not be allowed, whether payable by the employer or payable as a lien against the employees recovery, for any expense incurred as provided by Article 2 (commencing with Section 4600) of Chapter 2 of Part 2, nor shall the employee have any liability for the expense, if at the time the expense was incurred the provider either knew or in the exercise of reasonable diligence should have known that the condition being treated was caused by the employees present or prior employment, unless at the time the expense was incurred at least one of the following conditions was met: satisfied:
(1)The expense was incurred for services authorized by the employer.
(2)The expense was incurred for services furnished while the employer failed or refused to furnish treatment as required by subdivision (c) of Section 5402.
(3)The expense was necessarily incurred for an emergency medical condition, as defined by subdivision (b) of Section 1317.1 of the Health and Safety Code.
(c)For claims of occupational disease or cumulative injury filed on or after January 1, 2018, the employer shall not be liable for the payment of any lien for medical treatment unless one of the provisions of subdivision (i) of Section 4600 is satisfied or the parties agree to a settlement by compromise and release which complies with subdivision (d) of Section 5005.
(c)(d)The changes made to this section by Senate Bill 457 of the 201112 Regular Session do not modify in any way the rights or obligations of the following:
(1)Any health care provider to file and prosecute a lien pursuant to subdivision (b) of Section 4903.
(2)A payer to conduct utilization review pursuant to Section 4610.
(3)Any party in complying with the requirements under Section 4903.
SEC. 3.Section 5005 of the Labor Code is amended to read:5005.(a)In any case involving a claim of occupational disease or cumulative injury, as set forth in Section 5500.5, the employee and any employer, or any insurance carrier for any employer, may enter into a compromise and release agreement settling either all or any part of the employees claim, including a part of his claim against any employer. Such A compromise and release agreement, upon approval by the appeals board or a referee, shall be a total release as to such the employer or insurance carrier for the portion or portions of the claim released, but shall not constitute a bar to a recovery from any one or all of the remaining employers or insurance carriers for the periods of exposure not so released.
In(b)In any case where a compromise and release agreement of a portion of a claim has been made and approved, the employee may elect to proceed as provided in Section 5500.5 against any one or more of the remaining employers, or against an employer for that portion of his exposure not so released; released, and in any such proceeding after election following compromise and release, that portion of liability attributable to the portion or portions of the exposure so released shall be assessed and deducted from the liability of the remaining defendant or defendants, but any such defendants. The defendant shall not receive no credit for any moneys paid by way of compromise and release in excess of the liability actually assessed against the released employments and the employee shall not receive any further benefits from the released employments for any liability assessed to them above what was paid by way of compromise and release.
In(c)In approving a compromise and release agreement under this section, the appeals board or referee shall determine the adequacy of the compromise and release agreement as it shall then reflect the potential liability of the released exposure after apportionment, but need not make a final actual determination of the potential liability of the employer or employers for that portion of the exposure being released.
(d)For claims of occupational disease or cumulative injury filed on or after January 1, 2018, the employer shall not be liable for the payment of any lien for medical treatment unless one of the provisions of subdivision (i) of Section 4600 is met or the amount of the compromise and release, exclusive of the cost of past and future medical treatment, is twenty-five thousand dollars ($25,000) or more.
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Date
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Status
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| Feb 1, 2018 | From committee: Without further action pursuant to Joint Rule 62(a). |
| May 3, 2017 | In committee: Set, first hearing. Failed passage. |
| Feb 6, 2017 | Referred to Com. on INS. |
| Jan 26, 2017 | From printer. May be heard in committee February 25. |
| Jan 25, 2017 | Read first time. To print. |
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Date
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Description
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Location
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Votes
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| May 3, 2017 | Do pass and be re-referred to the Committee on [Appropriations] | Assembly Standing Committee on Insurance |
Failed |
This list shows positions taken on this bill by organizations on the date displayed, which is linked to the original source.
Positions by individuals are not included.
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Organization
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Position
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Date
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|---|---|---|
| California Applicants Attorneys Association | ** Support | May 2, 2017 |
| California Applicants' Attorneys Association | ** Support | May 2, 2017 |
| California Labor Federation | ** Against | May 2, 2017 |
| California Medical Association | ** Against | May 2, 2017 |
| California Professional Firefighters | ** Against | May 2, 2017 |
| California Society Of Industrial Medicine And Surgery | ** Against | May 2, 2017 |
| CALPASC | ** Support | May 2, 2017 |
| Construction Employers' Association | ** Support | May 2, 2017 |
| The Teamsters | ** Support | May 2, 2017 |
Date of Hearing: May 3, 2017
ASSEMBLY COMMITTEE ON INSURANCE
Tom Daly, Chair
ABPCA Bill Id:AB 221 (
Author:Gray) – As Introduced Ver:January 25, 2017
SUBJECT: Workers’ compensation: cumulative trauma
SUMMARY: Establishes criteria that must be satisfied in order for an injured worker to file a cumulative trauma (CT) claim. Specifically, this bill:
- Provides that, for claims involving occupational disease or CT filed on or after January 1, 2018, neither the employee nor the employer shall have any liability for payment for medical treatment unless one or more of the following criteria is met:
- The treatment was authorized by the employer;
- The injury to the body or body parts for which the treatment was provided has been accepted by the employer;
- The Workers Compensation Appeals Board (WCAB), after an evidentiary hearing or stipulation, finds that the injury being treated was a compensable work injury; or
- The employee has undergone an evaluation by a qualified medical examiner (QME), or an agreed medical examiner (AME), and that physician has determined that the occupational disease or CT was caused, in whole or in part, by the employment.
- Specifies that an employer is not liable for the payment of any liens for medical treatment unless the standards specified above are met, or a compromise and release is agreed to.
- Provides that, in addition to the standards specified above, an employer is not liable for the payment for medical treatment unless the value of the compromise and release, exclusive of the cost of past or future medical treatment, is at least $25,000.
EXISTING LAW:
- Provides for a comprehensive system of workers’ compensation benefits for employees who suffer conditions or injuries that arise out of or in the course of employment.
- Establishes a statute of limitations for filing a claim with an employer for work-related injuries, generally one year after the injury occurred.
- Provides that, in the case of occupational illnesses or CT, the employee’s claim is to be filed with the last employer for whom the employee worked and was exposed to the conditions that contributed to the illness or injury.
- Provides that the statute of limitations for an occupational illness or CT, subject to specific exceptions for professional athletes, is one year from the date the employee learns that the disabling effects of the CT may have been work related.
FISCAL EFFECT: Undetermined.
COMMENTS:
- Purpose. According to the author, there is a fraudulent business model involving CT claims that poses a threat to legitimate CT claims. This business model, according to the author and bill proponents, involves certain lawyers and physicians who operate call centers that use misleading messages with the purpose of finding candidates to file cumulative trauma back injury claims. The goal of these claim filings is to run up medical service liens, and then have the attorneys settle the non-medical portion of the claims for low dollar amounts, typically less than $25,000. According to the author and proponents, legitimate CT claims satisfy the bill’s requirements, and the claims filed by these operators rarely meet the criteria, and therefore the bill will prevent this fraudulent business model from continuing to abuse the system.
- Cumulative Trauma. It is well established that CT claims are legitimate claims in the workers’ compensation system. However, due to the complexity involved in CT claims, as compared to acute injuries that occur as a result of a specific causation (e.g., a slip and fall injury, a vehicle accident, or a burn caused by a fire or other industrial accident), there are some unique rules that apply.
Historically, because a CT injury (carpal tunnel syndrome, chronic lower back conditions) may have resulted due to employment by a number of different employers, the liability for that CT was spread among all of those employers. However, that approach proved more than cumbersome, and very expensive, for all parties. As a result, the law was changed to require the last employer where the injured worker was exposed to the factors that cause the CT be responsible. There are exceptions to this rule, such as where the last employer is, for some reason, unable to provide benefits. But in most cases, the “last employer” rule applies.
A second complication involves the statute of limitations. In cases of CT, it is difficult to pinpoint a specific date where the injury occurred, because by definition it has been occurring and developing over a period of time. One could argue that the date of diagnosis might serve as a sufficient “date certain” from which to measure a one year statute of limitations. However, even though an injury might be diagnosed at a specific time, but the statute of limitations rule in effect does not recognize this date as triggering the one year period within which to file a claim. The fact that a claimant knows of an injury is not sufficient. The additional fact necessary to start the statute of limitations running is the point in time where the injured worker learns that the injury or its disabling effect was caused by work. - The bill’s four criteria. The goal of the bill is to create a line between legitimate CT claims, and the abusive or fraudulent claims that proponents see coming from unscrupulous physicians and lawyers. To accomplish this goal, the bill identifies four criteria, at least one of which they believe any legitimate CT claim will satisfy. Proponents have offered to add to the list any other criteria that make sense if opponents can identify legitimate CT claims that the bill would exclude.
- CT claim trends. A key purpose for proponents of the bill is to address concerns based on recent trends with respect to CT claims. Based on research by the California Workers’ Compensation Institute (CWCI) and others, a few trends appear to be clear. The frequency of CT claims is on the rise, and in the case of the Los Angeles area, on the rise at potentially alarming rates. In addition to the increasing frequency, the severity of CT claims appears to be increasing, with CT claims costs more than 50% higher than specific injury claim costs. Additionally, the upward trend in claims appears to be more prevalent in manufacturing jobs.
- Complexity of CT claims. CT claims are already among the most complex injuries that the workers’ compensation system deals with. According to opponents, as many as two-thirds of CT claims are initially denied either in whole or in part. This is often done, according to opponents, for tactical reasons by claims administrators. It can also be due to the uncertainties associated with causation, particularly in cases where the last employer did not employ the claimant for a long period of time, or in cases where the claim is a post-termination claim. In light of these challenges, opponents are concerned that the bill’s new requirements will make a difficult situation worse.
- Access to medical services. Providers of medical services and firefighters are concerned that the bill’s $25,000 threshold will discourage providers from accepting what will be legitimate CT claims. According to physician groups, it is difficult at the outset of a claim to judge what its “value” will be, even if there is a clear industrial basis to the injury being treated. They point to the bill’s absolute bar of claims that do not rise to the level of $25,000 in indemnity payments. Medical providers will be leery to agree to treat CT conditions due to the bill’s prohibition against either the employee or employer being held responsible to pay medical bills unless the threshold is met.
- Compromise and release. Opponents believe that the bill would provide additional incentive for workers with CT injuries to enter into compromise and release agreements. These agreements typically involve a waiver of the right to future medical care in exchange for a lump sum payout. The concern is that, with the complexities of CT injuries, this may not be the appropriate course of action, but injured workers may feel pressured into an agreement because it appears more attractive.
- Litigation risk. CT injuries are often complex medical problems, and at times it is difficult to know whether a particular injury is CT or a sudden event-related condition. In light of the new rules that would govern CT claims, there is a litigation risk where either side of a claim may find it tactically beneficial to have the injury classified in one way or the other. Opponents are concerned that this would complicate matters for injured workers, and result in even larger numbers needing to retain an attorney.
- Necessity for bill. Opponents argue that the bill is premature, based on the uncertainties and complexities it creates for the system, and the recent enactment of SB 1160 (Mendoza) – Statutes 2016, Chapter 868 -- and AB 1244 (Gray) – Statutes 2016, Chapter 852 -- last year. These two bills enacted a substantial new anti-fraud regime that targets some of the very fraudsters targeted by this bill. The opponents suggest that fraud, not CT, is the culprit that needs attention, and it is too soon to conclude that last year’s bills have failed to adequately do the job.
REGISTERED SUPPORT / OPPOSITION:
Support
California Applicants’ Attorneys Association
CALPASC
Construction Employers' Association (CEA)
The Teamsters
Opposition
California Labor Federation
California Medical Association
California Professional Firefighters (CPF)
California Society of Industrial Medicine and Surgery
Analysis Prepared by: Mark Rakich / INS. /
Bill Author
Bill Co-Author(s):