AVOIDING UNFAIR CLAIMS POST-LITIGATION MEDICAL FEE DISPUTES IN KENTUCKY WORKERS COMPENSATION

Transcription

1 AVOIDING UNFAIR CLAIMS POST-LITIGATION MEDICAL FEE DISPUTES IN KENTUCKY WORKERS COMPENSATION PRESENTED BY: POHL & AUBREY, P.S.C. 271 WEST SHORT STREET, SUITE 100 LEXINGTON, KENTUCKY (859) NORTH HURSTBOURNE PARKWAY, SUITE 110 LOUISVILLE, KENTUCKY (502)

2 AVOIDING UNFAIR CLAIMS POST-LITIGATION MEDICAL FEE DISPUTES KENTUCKY WORKERS COMPENSATION I. BASIC PARAMETERS OF THE UNFAIR CLAIMS SETTLEMENT PRACTICES ACT 2 II.THE ACT and III.THE TIMELINE 2 BREAK 10 minutes IV.THE FACTORS V.OUR PHILOSOPHY 1 VI.WHEN NOT WARRANTED VII.WHEN WARRANTED 1 VIII. FILE MATERIAL NEEDED IX.SETTLEMENT OF MEDICALS

3 POST-LITIGATION MEDICAL FEE DISPUTES: WHEN WARRANTED AND WHEN NOT INTRODUCTION This Outline and the presentation which is concomitant addresses an issue which frequently arises post award and post settlement; determining our liability for continuing medical benefits. We address herein the obligations which we have under the Kentucky Workers Compensation Act, including our duties to proceed within the confines of the Unfair Claims Provision of the Act. I.BASIC PARAMETERS OF THE UNFAIR CLAIMS SETTLEMENT PRACTICES ACT Following notice of an injury, the employer/carrier must advise of the acceptance or denial of the claim. The employer must provide, in writing, within a reasonable period of time (generally accepted to be 30 days or less), the specific reasons for the denial to the employee. The employer must inform the employee if additional information is needed for the claim to be accepted, and must meet the time restraints for accepting and paying claims pursuant to the Act. There are certain standards set forth for fair and equitable settlement of workers' compensation claims. In that regard the employer shall: Attempt in good faith to pay a claim when liability is clear Not misrepresent pertinent facts or law Not compel the employee to answer to formal proceedings when liability is clear. Not offer settlement substantially less than the reasonable value of the claim. Not threaten to file or utilize a policy of filing appeals to compel a settlement for less than an award. Not require an employee to obtain information that is readily accessible to the employer. 803 KAR 25:240 is the Rule which sets forth the criteria for implementation of the provisions of KRS This regulation contains pertinent definitions as well. For example, an agent is a person or entity performing claims adjusting, case management, Utilization Review, or other services on behalf of a carrier. In other words, it is more than just the adjuster. The Regulations further provide that a carrier s claim files, and the files held by an agent, are subject to examination by the Commissioner or his designee. The Regulations provide that the carrier must give adequate notice regarding policy

4 provisions and coverage. Failure to provide the employer with the notice that is required to be posted by the employer (giving the name of the carrier, the means to access medical care, etc.) constitutes a violation of the UCP. After notice of an injury, the carrier/administrator is required to diligently investigate the claim. If the injury has resulted in the need for medical care or lost time, the carrier/administrator must as soon as practicable either accept or deny the claim. The Kentucky Department of Workers' Claims maintains a list of the most common unfair claims settlement practices violations. While the list can change, the following are items most frequently seen: Challenging medicals for the singular purpose of forcing a settlement, especially a waiver of future medical treatment. Denying medicals post-award without an Order from an ALJ. Inappropriate attempt to direct medical care. Filing repetitive Medical Fee Disputes with virtually identical information. Failing to timely or properly challenge medical expenses. Failing to respond to inquiries from the claimant, claimant s counsel, or the Department of Workers' Claims. Misrepresentation of facts to deny a claim. Failing to timely respond (a response must be made to the DWC within 15 days). Failing to timely pay benefits, attorney s fees, settlement, or other indemnity benefits. Failing to properly file forms setting forth occurrence of injury, initiation of payments and termination of payments. II.THE ACT Per Kentucky s Workers Compensation Act, an employee is entitled to lifetime medical benefits if they sustain a compensable work related injury, and the claim is preserved by either an ALJ ruling or a Settlement Agreement. Interestingly, while income benefits terminate when an employee qualifies for normal old age Social Security, medical benefits continue until the employee s death. III.THE TIMELINE In a post award or settlement claim where medical benefits are preserved, in the eyes of the law, there is a judicial determination that a compensable injury occurred and, liability for medicals attaches as a matter of law. Consequently, the burden of proof and risk of non-persuasion shifts to the employer concerning any potential future medical fee dispute. As such, there is an obligation to either pay or contest medical treatment expenses arising from either provided or proposed treatment within 30 days.

5 Waiting 31 days or more to take any action on the matter forfeits any potential medical fee dispute, and there is responsibility for payment of either the provided or proposed treatment. There is a 30 day window of time in which to act in order to timely proceed in investigating a potential medical fee dispute and, thereafter, timely filing a motion to reopen the claim to resolve a medical fee dispute. IV.THE FACTORS When addressing a post-litigation claim and considering the merits of a medical fee dispute, carefully consider the following factors before proceeding with such a medical fee dispute: Have you acted timely within the requisite 30 day period in developing medical proof and also in filing a Motion to Reopen the claim to resolve a medical fee dispute? Do you have time to proceed in obtaining a peer review, records review, or IME before proceeding in filing a medical fee dispute? Should you first proceed in developing medical proof concerning causation or reasonableness issues before considering the filing a medical fee dispute? Should you proceed with Utilization Review? Is conservative treatment or surgical treatment being recommended? Doe the cost of the treatment warrant the attendant litigation costs to challenge such treatment? Will the treating doctor voluntarily agree to modify ongoing medical care so as to avoid the need for filing a medical fee dispute? Has the treating doctor responded to your request for an opinion on the relatedness of the condition being treated or to your request for an updated medical treatment plan? Is medical treatment being provided that is prolonging the employee s recovery or is detrimental to the employee s health? Are there any unique factors requiring a medical fee dispute (such as the employees failure to respond to your request for an updated Form 106/Medical Release or for an updated Form 113/Notice of Designated Treating Physician, the employee s failure to follow medical advice, etc.)? Should you proceed in filing a medical fee dispute to foster settlement of this claim? Should you proceed in filing a medical fee dispute to reduce the monetary value of a Medicare Set Aside account? V.OUR PHILOSOPHY Our firm has assisted employers on numerous occasions with successful postlitigation medical fee disputes by either eliminating the responsibility for all future medical care or by significantly reducing ongoing treatment. However, we take a very

6 conservative approach when recommending a medical fee dispute, and make sure that we first have strong medical proof to support our position. If you have the luxury of time to proceed in scheduling an IME, you should always do so to address issues regarding the relatedness of an underlying condition and/or the reasonableness of either the provided or proposed medical care. Further, please be sure to schedule an IME with a credible physician so as to bolster your medical fee dispute before the assigned ALJ. VI.WHEN NOT WARRANTED In post-litigation claims in which only small amounts are being paid for ongoing medical treatment (such as limited office visits and medications), carefully consider whether the litigation costs to proceed in filing a medical fee dispute are justified. Further, if the provided or proposed treatment involves diagnostic testing (such as an MRI, EMG/NCV, etc.), it is generally advantageous to allow for same. A dispute regarding treatment is a better dispute than one related to diagnostics, and the diagnostic studies may, in the end, support a relatedness defense. VII.WHEN WARRANTED When medical expenses are regular, recurrent, and excessive (such as excessive office visits, medications, urine drug screens, injections), or if an expensive procedure has been performed/recommended (such as surgical intervention), the claim is ripe for consideration to the filing a medical fee dispute. If the luxury of time in which to schedule an IME is not present; for example, a request for surgery is made (we have 30 days to file a medical fee dispute to challenge the provided/ proposed surgery), consider obtaining a peer review report from a reviewing physician when there are relatedness concerns. If the concerns are strictly with respect to the reasonableness of the provided/proposed surgery, however, Utilization Review is required. If the reviewing UR physician recommends approving the proposed surgery, there is no dispute; the charge is payable. If the reviewing UR physician recommends denying the provided/proposed surgery as constituting unreasonable medical care, it is required in post litigation/settlement claims that a Motion to Reopen be filed to challenge the reasonableness of the proposed surgery. Failure to do so results in forfeiture of the right to contest. An IME with a credible evaluating physician is recommended, but there will be time to do so since the medical fee dispute will be placed on a proofing schedule. VIII. FILE MATERIAL NEEDED If basis exists to file a Motion to Reopen and Medical Fee Dispute (either on causation or reasonableness/necessity grounds), the following material will be needed: A copy of the previous ALJ decision or Settlement Agreement

7 A copy of the medical records concerning the subject of the medical fee dispute (treatment note, operative report, request for future proposed treatment, etc.) A copy of the medical records that support your medical fee dispute (IME report, Peer Review report, Utilization Review report, etc.) Please note that a medical fee dispute cannot be initiated without receipt of the above-mentioned documents. With assignment to an ALJ for adjudication, additional file material will be necessary to prosecute the Fee Dispute. Same includes: A copy of all prior treatment notes A copy of the medical expense payment log over the past two years The name, address, and phone number of the claimant Updated Form 106/Medical Release IX.SETTLEMENT OF MEDICALS PRE-LITIGATION OFFER: Money Agree to a limited duration of future medical treatment Agree to a designated treating physician Agree to limited means of future treatment POST- LITIGATION OFFER: Money Agree to a designated treating physician Agree to a specific treatment plan and prescription regimen MSA CONCERNS Discover the plaintiff s Medicare status If applicable, discover the potential need and cost of a MSA If applicable, discover any potential Medicare lien