Lessons 7, 8, 9: Liens 18 months

and what to do with files past

time to file liens

www.workcompliens.com

October 20, 2014

October 2014 www.workcompliens.com 1

WCAB

Issues Orders

IMR

Issues Orders IBR

Issues Orders

WCAB

Issues Orders Subject to lien

time

requirements and

fees

Not Subject to

lien

requirements

Causation

Contested

Liability

Medical Legal

Appealing an

IMR Decision

Appealing an

IBR Decision

Petition to

Enforce an IBR

decision or IMR

Treatment for

future medical

Untimely UR or

no UR after RFA

by choice

Untimely or no

response to 2nd

bill review

request by

choice

IMR-Medical

Necessity

Issues Orders no lien or

time to file lien

IMR, UR,

Authorization

Process

Start Time

End Time

RFA

Court Order

Resolving denied

case or contested

liability issues

After 12 month or

factual

documented

change

Probably when

retrospective

review conduct as

unlikely change in

factual medical

Enforced by the

DIR

No set time by

events

Only Subject to

WCAB if no UR

response or

untimely –choice

Defective UR not

subject to

WCAB only

IMR

IBR

Issues Orders Start Time

End Time

No subject to

WCAB unless

no response to

2nd bill review

request or

untimely

90 days after

initial review

unless contested

liability issue

2nd bill review

request

90 days after

court order

resolve contested

liability

2nd bill review

request

IBR Request

30 days after

receipt of 2nd

review

Failing to meet

90 2nd review

Failing to meet

30 IBR request

Not appealing

IBR

determination to

WCAB within

30 days No lien or time

to file lien

Present Law SB 863

4903.5. (a) A lien claim for expenses as

provided in subdivision (b) of Section 4903 shall

not be filed after three years from the date the

services were provided, nor more than 18 months

after the date the services were provided, if the

services were provided on or after July 1, 2013.

Rand Study on Lien 2011

As a symptom, the billions of dollars in dispute reflect both obligations that should have been paid but which may eventually have to be compromised in order to obtain any payment, and claims that should not be paid but which may eventually have to be compromised in order to obtain closure. The volume of liens forces the courts to encourage settlement, almost to the point of coercion. The necessity of settlement rewards both unjustified claims and unjustified refusals.

From DWC (interpreting existing laws)

On February 17, 2013, the DWC stated that it was in bad faith

for a payor to refuse to compromise and settle if there existed no reasonable grounds not to compromise

and resolve, adding that forcing a party to file a lien and pay a fee was in bad faith when no reasonable

grounds existed for the denial. The DWC went on further to state that the remedies available to a

provider would be an audit complaint form and sanctions, which leave us with the question, can the DWC award

sanctions.

“If a claims administrator has reasonable grounds to contend that nothing is owed, then good faith

negotiation does not necessarily require an offer of compromise. In the absence of a good faith

contention that nothing is owed, however, a refusal to negotiate prior to payment of the filing fee would

not be in good faith.”

Therefore, the question remains is the fact that the time to file liens expired a reasonable ground to deny

good faith compromise? Well if you read the DWC statement it states they cannot force the party to file a

lien.

IMR

(Independent

Medical

Reviewer)

There are Now Three (3) Forums Where One Can Get

Orders for Payment

IBR (Independent

Bill Reviewer)

WCAB (Workers

Compensation

Appeals Board)

File liens Statutory time limits / door closes

Petitions for Medical legal and Costs

Future Medical Treatment

Enforcing existing orders

When reasonable reimbursement only issues

Court order resolving contested liability

Or consent of the parties

Initial Request for Treatment

After 12 months or change in factual

documents conditional

Court order resolving contested liability or

consent of the parties

IMR

(Independent

Medical

Reviewer)

Triggers for Process to Start

IBR (Independent

Bill Reviewer)

WCAB (Workers

Compensation

Appeals Board)

3 years from last date of

service or 18 months if

date of services after July

01, 2013

Initial request

After 12 months

Prior to 12 months if change in

factual documents facts

Court order resolving

contested liability issue

Agreement by the parties

90 days second review 30 days

IBR –

After contested liability issue

resolved 90 days

Agreement by the parties

Issues Always Prevalent in Denied or Contested Liability

Issues

Causation

Medical Necessity

Reasonable Reimbursement

Issues Always Prevalent in Denied or Contested Liability

Issues

Causation

Medical Necessity

Reasonable Reimbursement

Resolved by

Court Order

Triggers

Triggers

No lien or time limit required

Panel Decision on Liens Continued

On March 15, 2013, the WCJ issued the F&O, finding in pertinent part that section

4903.5(a) barred the lien for the dates of service from March 19, 1999 to April 14, 2007

and ordering that the lien was disallowed as to that period.

On March 29, 2013, lien claimant filed its petition for reconsideration. It contends that

its lien was timely filed on April 14, 2010 because the last date that services were

provided was February 17, 18 2011.

Preliminarily, we note that lien claimant continued to provide treatment and to receive

payment over a twelve year period and there is no evidence in the record that lien

claimant ever discontinued treatment of applicant. As a result, it appears that the date of

April 14, 2007 is an arbitrary cutoff based on the defendant's construction of the time

limits in amended section 4903.5(a).

Panel Decision on Liens Continued

Labor Code § 4903.5, subdivision (a) "A lien claim for expenses as provided in subdivision (b) of Section 4903 shall not be filed after three years from the date the services were provided, nor more than 18 months after the date if the services were provided on are after July 1, 2013.

From The Case of CHARLES KINDELBERGER, vs. CITY OF LOS ANGELES, permissibly self- AND DECISION Case Nos. May 24, 2013;ADJ586942 (VNO 0384663) ADJ687483 (VNO 0384664) OPINION AND ORDER GRANTING PETITION FOR RECONSIDERATION

Lien claimant contends in pertinent part that the WCJ erred because it timely filed its lien before the last date that services were provided so that its lien was not barred.

Panel Decision on Liens Continued

As of January 1, 2013, section 4903.5, subdivision (a) states that:

"A lien claim for expenses as provided in subdivision (b) of Section

4903 shall not be filed after three years from the date the services were

provided, nor more than 18 months after the date if the services were

provided on are after July 1, 2013. (Bold, italics added.)"

In the case of ongoing treatment, "the date the services were provided"

is understood to be the last date that treatment was provided. Defendant

contends that the changes in the time limits to file a lien under amended

section 4903.5(a) also altered the construction of that phrase, so that it

now means that the operative date is the individual date of service. But

no changes were made to that phrase when the statute was amended.

From a WCJ

Cal Lab Code § 5803

Cal Lab Code § 5803 which states: “The appeals board has continuing jurisdiction over all its orders, decisions, and awards made and entered under the provisions of this division, and the decisions and orders of the rehabilitation unit established under Section 139.5. At any time, upon notice and after an opportunity to be heard is given to the parties in interest, the appeals board may rescind, alter, or amend any order, decision, or award, good cause appearing therefore

Future Medical

Barbara Ann Hingtgen, Applicant v. County of San Bernardino,

PSI, Defendant (2012) W.C.A.B. No. ADJ446534 (SBR 0216831)—

writ denied case

“In summary, the Appeals Board's allowance of AMG's medical

treatment expenses is a matter of enforcing the Stipulated Award for

future medical treatment, which defendant agreed to provide beginning

in 1997. Under the circumstances of this case, we conclude that the

Board's power to enforce the Stipulated Award is not subject to the

constraints of Labor Code section 4903.5(a). Therefore, we will affirm

our decision of April 11, 2011

Barbara Ann Hingtgen, Applicant v. County of San Bernardino, PSI,

Defendant (2012) W.C.A.B. No. ADJ446534 (SBR 0216831)—writ denied

case

In this case, there is an "agreement" within the meaning of section 4909, namely the

Stipulated Award of January 22, 1997. Therein defendant agreed to furnish applicant

with future medical treatment. Over the years that followed, AMG provided some of

that treatment. The treatment provided by AMG is compensation that defendant agreed

to pay subject to reasonableness and necessity, as opposed to a debt incurred by AMG

and secured by compensation, i.e., a lien for which defendant might be found liable by

the WCAB. By virtue of the Stipulated Award, the treatment provided by AMG was not

just secured by compensation, it was compensation in and of itself. Seen this way, the

Board's April 11, 2011 decision rejecting the lien Statute of Limitation and allowing

AMG's "lien" to the extent reasonable and necessary, is a decision which enforces the

Stipulated Award of January 22, 1997. The Board has the power to make supplemental

orders or awards necessary to enforce its previous decisions, including a previous

award of medical treatment, and these enforcing orders are not rescissions, alterations,

or amendments of a prior award subject to the five-year time restriction of Labor Code

section 5804.

From Report of The California Commission on Health and

Safety

and Workers’ Compensation

Stale claims are not necessarily barred by section 4903.5

because a lien is implied any time the claims administrator has

written notice of facts sufficient to constitute a lien. Section

4904, which otherwise deals only with Employment

Development Department liens, begins with the sentence, “If

notice is given in writing to the insurer, or to the employer if

uninsured, setting forth the nature and extent of any claim that

is allowable as a lien, the claim is a lien against any amount

thereafter payable as compensation, subject to the

determination of the amount and approval of the lien by the

appeals board.”

Liens

(Later Amended ) Rule 10770(b)(5) provides that if

written notice of a lien claim is given to a defendant,

this will not constitute the “filing” of a lien with the

WCAB.

Sept 2013 effective Oct 2013:

§10770 (c) (10) Where a lien has been served on a party,

that party shall have no obligation to file that lien with

the Workers' Compensation Appeals Board.

Prior 2013

Prior to 2013:

Under Cal Lab Code § 4903.5 (b) upon six

months learning of industrial claim – 6 month

grace period into 2013

Prior to 2013 This changed in 2013 they stated

12 months and took out providers

Prior to 2013:

Cal Lab Code § 4903.5 (b) which states: “Notwithstanding subdivision (a), any health care provider, health care service plan, group disability insurer, employee benefit plan, or other entity providing medical benefits on a nonindustrial basis, may file a lien claim for expenses as provided in subdivision (b) of Section 4903 within six months after the person or entity first has knowledge that an industrial injury is being claimed.”

From Panel Decision

Sanctions: “ litigating a lien to

the point of setting it for trial

without submitting any evidence

in support thereof…”

2014 Liens / WCAB

Panel Decision:

As pointed out on page two of the WCJ's Report,

it appears that lien claimant labors under the

mistaken impression that the WCJ and the

WCAB are here to help make the lien claimant's

case.”

Panel Decision

Panel:

There is a difference between trying to get a

better settlement and having a legal dispute that

requires the WCAB assistance. Fewer files in

2014 should reach this point as the party who is

wrong will suffer sanctions and costs even the

defense

Panel Decision on Liens Continued Moreover, the interpretation urged by defendant would create a separate statute of

limitations for each date of treatment rather than for the entire lien. As a result, it is

foreseeable that even while continuing to treat an applicant, a careful lien claimant

would file a lien for each date of treatment rather than simply filing a lien at the

conclusion of the treatment, thereby flooding defendants and the Workers'

Compensation Appeals Board with multiple extraneous liens.

Accordingly, we grant reconsideration, rescind the F&A and return the case to the WCJ

for further proceedings as appropriate and a new decision consistent with this opinion,

from which any aggrieved party may timely seek reconsideration.

For the foregoing reasons,

IT IS ORDERED that the Petition for Reconsideration by lien claimant Advanced

Orthopedics of the Findings of Fact and Orders issued on March 15, 2013 by the

workers' compensation

administrative law judge is GRANTED.

KINDELBERGER, Charles

Rand Study on Lien 2011

As a symptom, the billions of dollars in dispute reflect both obligations that should have been paid but which may eventually have to be compromised in order to obtain any payment, and claims that should not be paid but which may eventually have to be compromised in order to obtain closure. The volume of liens forces the courts to encourage settlement, almost to the point of coercion. The necessity of settlement rewards both unjustified claims and unjustified refusals.

Present Law SB 863

4903.5. (a) A lien claim for expenses as

provided in subdivision (b) of Section 4903 shall

not be filed after three years from the date the

services were provided, nor more than 18 months

after the date the services were provided, if the

services were provided on or after July 1, 2013.

Summary

1. Services Provided for Future Medical

treatment.

2. Medical legal services prior to 2013

3. Medical legal services after 2013

4. Services were the case settled prior to 2013

and the defense was obligated to file a lien

5. Knowledge of industrial injury or lack of

changed in 2013

Pleading

“We deny lien claimant's petition for reconsideration for the additional reason

that the petition is unintelligible and violates the requirements of WCAB Rule

10842(a) and (b). (Cal. Code Regs., tit. 8, 17 10842.) The rule requires clear

and specific reference to evidence which supports the petitioner's contentions.

Lien claimant fails to refer to any evidence in alleging on page five of its

petition that "applicant was referred by the secondary treating physician on the

advice of the treating physician pursuant to and in compliance with applicable

ACOEM / AMA Guidelines to assess symptomology due to pain and to

determine if any counterbalancing factors such as maladjustment [sic]." Lien

claimant repeats this allegation on page six, again unsupported by specific

reference to any evidence. As pointed out on page two of the WCJ's Report, it

appears that lien claimant labors under the mistaken impression that the WCJ

and the WCAB are here to help make the lien claimant's case.”

Prior to 2013 This changed in 2013 they stated

12 months and took out providers

Prior to 2013:

Cal Lab Code § 4903.5 (b) which states: “Notwithstanding subdivision (a), any health care provider, health care service plan, group disability insurer, employee benefit plan, or other entity providing medical benefits on a nonindustrial basis, may file a lien claim for expenses as provided in subdivision (b) of Section 4903 within six months after the person or entity first has knowledge that an industrial injury is being claimed.”

Prior to 2013

This means that if a medical provider has provided medical treatment and he or she is unaware that it is an industrial injury (i.e., auto accident, private pay paid, or no payments, employer no work comp insurance) which is a factual finding as to knowledge then the medical provider has six months from learning it is an industrial injury and the time requirement of Cal Lab Code § 4903.5 (a) would not apply if the time limit of Cal Lab Code § 4903.5 (a) had already expired

Prior 2013

Prior to 2013:

Under Cal Lab Code § 4903.5 (b) upon six

months learning of industrial claim – 6 month

grace period into 2013

Cal Lab Code § 5803

Cal Lab Code § 5803 which states: “The appeals board has continuing jurisdiction over all its orders, decisions, and awards made and entered under the provisions of this division, and the decisions and orders of the rehabilitation unit established under Section 139.5. At any time, upon notice and after an opportunity to be heard is given to the parties in interest, the appeals board may rescind, alter, or amend any order, decision, or award, good cause appearing therefore

Future Medical

Barbara Ann Hingtgen, Applicant v. County of San Bernardino,

PSI, Defendant (2012) W.C.A.B. No. ADJ446534 (SBR 0216831)—

writ denied case

“In summary, the Appeals Board's allowance of AMG's medical

treatment expenses is a matter of enforcing the Stipulated Award for

future medical treatment, which defendant agreed to provide beginning

in 1997. Under the circumstances of this case, we conclude that the

Board's power to enforce the Stipulated Award is not subject to the

constraints of Labor Code section 4903.5(a). Therefore, we will affirm

our decision of April 11, 2011

Barbara Ann Hingtgen, Applicant v. County of San Bernardino, PSI,

Defendant (2012) W.C.A.B. No. ADJ446534 (SBR 0216831)—writ denied

case

In this case, there is an "agreement" within the meaning of section 4909, namely the

Stipulated Award of January 22, 1997. Therein defendant agreed to furnish applicant

with future medical treatment. Over the years that followed, AMG provided some of

that treatment. The treatment provided by AMG is compensation that defendant agreed

to pay subject to reasonableness and necessity, as opposed to a debt incurred by AMG

and secured by compensation, i.e., a lien for which defendant might be found liable by

the WCAB. By virtue of the Stipulated Award, the treatment provided by AMG was not

just secured by compensation, it was compensation in and of itself. Seen this way, the

Board's April 11, 2011 decision rejecting the lien Statute of Limitation and allowing

AMG's "lien" to the extent reasonable and necessary, is a decision which enforces the

Stipulated Award of January 22, 1997. The Board has the power to make supplemental

orders or awards necessary to enforce its previous decisions, including a previous

award of medical treatment, and these enforcing orders are not rescissions, alterations,

or amendments of a prior award subject to the five-year time restriction of Labor Code

section 5804.

4903.1. (a)

(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.

Lesson 7: Liens 18 months and

what to do with files past time to

file liens

www.workcompliens.com

October 20, 2014

October 2014 www.workcompliens.com 50