The DWC has published proposed Independent Medical Review regulations
(a link to them is noted at the bottom of this post).

The proposed regs are on a DWC forum page, with the forum for comments slated to close December 7. Because there is not time for regular rulemaking for these rules required by SB 863, the DWC will have to submit them to the Office of Administrative Law as emergency regulations:
http://www.oal.ca.gov/emergency_regulation_process.htm

Some of the concerns about the IMR rules are really simply reflective of concerns about SB 863 itself. Questions about the constitutionality of the IMR process were raised even by counsel for proponents. In any event, the regulations as drafted do not stray very far from the backbone of SB 863.

Here are some quick takes on selected components of the proposed regs:

REQUEST FOR AUTHORIZATION FORM
This is long overdue. It is often difficult to sort out what is being requested from what are merely future possible treatments mentioned by the treater. Having a form that requires a request and a written authorization will cut down on misunderstandings.

IMR ELIGIBLITY
The DWC will screen IMP requests to make sure the request is eligible for IMR determination. For example, if there is a dispute about industrial causation of a particular body part problem, treatment issues pertaining to that body part would not be sent to IMR. This step is probably necessary, but the DWC has tended to get bogged down by screening. During the Schwarzenegger administration, backlogs got out of hand at the DWC Medical Unit that handles QME panel requests. It remains to be seen whether the DWC will staff the IMR screening task sufficiently to avoid big backlogs.

THE EXPENSE OF IMR
IMR, which is paid by the employer, will actually be rather costly, with a price between $560 and $850 depending on the type of review and whether more than one reviewer is involved. This, and the time and expense of getting the records together to send to IMR, will probably cut down on the “just say no” type of denials where the disputed item isn’t all that expensive.
Injured workers and treating doctors who want to appeal the smaller stuff will probably get their way quite often. Whether this will save money in the long run isn’t clear, but it will probably cut down on the delays and frustrations for some workers. On the other hand, the expensive stuff will probably get more detailed scrutiny.

PROBLEMS WITH DRAFTING
Some of the provisions in the proposed regs seem inconsistent. For example, if a worker has a lawyer, the utilization review rules (for example, 9792.9.1) provide that certain notices are to be given in writing to the injured worker’s attorney. And 9792.10.5(b)(2) provides that the attorney
may provide certain documents to the independent medical review organization.
Yet, on its face 9792.10.5(a)(1)(F)(2) does not require the claims examiner to send the applicant attorney either a copy of or a list of the documents it is sending to the independent medical review organization.
Does this mean that the claims examiner need only send those documents to the employee? Why would the attorney not be entitled to at least a list of the documents sent?
This inconsistency is merely one example of items that are apparent drafting errors.

LIMITED APPEALS
Tracking the SB 863 statute, the IMR regs provide very limited basis for appealing IMR denials. Whether this meets constitutional muster is unclear.

IMR DELAYS
There appears to be no mechanism to deal with delays by the IMR organization if it does not issue timely decisions (30 days in most cases under 9792.10.6). If a decision is not rendered in a timely manner, is the item approved as a matter of law? Denied as a matter of law? Can the WCAB order the IMR organization to act if it does not act in a timely manner?

Questions, questions.

Stakeholders should look at these proposed regs and file comments before December 7:
http://www.dir.ca.gov/dwc/DWCWCABForum/IMR.htm

Stay tuned.

Julius Young
www.workerscompzone.com
www.boxerlaw.com

As of today, several weeks after the election, about a million votes were still to be counted:
here: http://www.sacbee.com/2012/11/26/501002 … rylink=cpy

It’s not likely that we’ll see much happening legislatively on workers’ comp within the next year or two now that SB 863 is law. But any “clean up” bills
will be entertained by the new legislative Supermajority.

Stay tuned.

Julius Young
www.workerscompzone.com
www.boxerlaw.com

As of today, several weeks after the election, about a million votes were still to be counted:
here: http://www.sacbee.com/2012/11/26/501002 … rylink=cpy

It’s not likely that we’ll see much happening legislatively on workers’ comp within the next year or two now that SB 863 is law. But any “clean up” bills
will be entertained by the new legislative Supermajority.

Stay tuned.

Julius Young
www.workerscompzone.com
www.boxerlaw.com

Too much pressure can make a pressure vessel explode.

So it is with workers’ comp rates. Rather than holding comp premiums steady without an increase, is it better to see those costs rise slowly?

Perhaps.

This is part of the conundrum facing California Insurance Commissioner Dave Jones, who held a rate hearing in Sacramento last Friday. Part of Jones’ job is to determine a “pure premium” workers’ comp benchmark rate, though such a determination is totally non-binding on insurers. Thus, insurers are free to set rates lower or higher than whatever Jones finally recommends.

But just as politicians sometimes use the “bully pulpit” to influence events, the Insurance Commissioner’s determination sets the tone and is often widely cited as a snapshot of the health of California’s workers’ comp system.

Whatever Jones does will likely be covered by the business press and cited as the symbol of workers’ comp costs in California.

Politically, the Brown Administration and the major employer and labor groups who put SB 863 together have a significant interest in SB 863 being seen as successful.

The issue facing Jones is whether to accept the proposed recommendation of the WCIRB Governing Committee, which voted 6-5 for a proposal that would not increase the $2.38 per $100 of payroll pure premium rate.

That vote put the WCIRB Governing Committee at odds with the WCIRB Actuarial Committee, which had recommended an advisory pure premium rate of $2.61 per $100 of payroll.

Ultimately, the math on savings to be achieved under SB 863 is voodoo math. Neither insurers, employers, labor or the DIR/Brown Administration itself can accurately predict the level of savings and the ratio of increased costs to savings.

Jones could choose to follow the WCIRB Governing committee by recommending no increase in the pure premium rate. After all, insurers will price their workers’ comp product as they wish. Moreover, Jones would be expressing confidence in the cost-saving aspects of the reforms, even if SB 863 does not eventually yield the results sought by Brown. And Jones would not want to replicate the years after SB 899 when insurers feasted on large profits while system costs dropped sharply.

On the other hand, Jones may be concerned that the Governing Committee position is too optimistic. Jones is aware that keeping the pure premium rate at $2.38 is under the current average filed rate of $2.57 and well below the rate charged by SCIF, whose President Tom Rowe proposed the no increase motion at the WCIRB Governing Committee. Jones may decide that it is better to let the “pure premium” rise a bit gradually so as to avoid a future whopping pure premium rate increase that would create more political chaos and bad vibes for the California economy.

I wasn’t able to attend the meeting due to other commitments. But from quotes I’ve seen, Jones is clearly concerned about the health of the industry.
Quoted in a Workcompcentral.com piece by Greg Jones, Workcompcentral Western Bureau Chief, Jones notes that”
“If we don’t get it right, that could have very significant consequences for the solvency and viability of workers’ compensation insurance carriers, and in turn, the availability of product in the market and in turn the pricing of product in the market which has potentially significant consequences for employers and their ability to hire employees”.

I suspect that Jones will take the latter approach and follow the WCIRB Actuarial Committee recommendation, or something close to it.

A decision from Jones will be out before Christmas.

Stay tuned.

Julius Young
www.workerscompzone.com
www.boxerlaw.com

Too much pressure can make a pressure vessel explode. So it is with workers’ comp rates. Rather than holding comp premiums steady without an increase, is it better to see those costs rise slowly? Perhaps. This is part of the conundrum facing California Insurance Commissioner Dave Jones, who held a rate hearing in Sacramento last

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