State: Calif.
WCAB Rules non-MPN Physician Reports Not Admissible: [2011-04-26]
Shaw, Jacobsmeyer, Crain & Claffey
In a split vote en banc decision, the WCAB has issued a comprehensive decision addressing one of the issues that have been floating around since the implementation of medical provider networks in 2004. In Valdez v Demo Warehouse, the WCAB held such reports are not admissible either on issues of medical treatment or on those involving compensation.
In this case the employee treated with the employer’s MPN physician for the first 30 days after injury and thereafter was directed by her attorney to a physician outside the MPN. The employee made no effort to utilize any of the internal MPN challenges to her initial treating physician’s recommendations or treatment and simply started treating outside the MPN. Approximately a year later the matter went to trial on the issue of temporary total disability beyond the first 30 days. The employer took the position the reports of the non-MPN physicians were not admissible and therefore no substantial evidence existed on the issue of TTD. The WCJ deferred the issue of whether an MPN was properly in place determining the trial was on the issue of TD only. Based on the non-MPN reports, TD was awarded along with reimbursement to EDD for its payments during the same time.
Defendant appealed arguing asserting the reports of non-MPN physicians were not admissible and therefore no evidence existed to support the workers' compensation judge's opinion. The WCAB granted Reconsideration and issued the en banc 5-1-1 decision with Commissioner Brass agreeing with the majority but dissenting on a portion of the decision and Commissioner Caplane dissenting in the holding regarding admissibility. In its holding the WCAB has ruled such non-MPN physicians do not qualify as “treating physicians” pursuant to Labor Code § 4600 nor as medical legal evaluators under Labor Code § 4061/4062. Pursuant to Labor Code § 4616.6 such reports are not admissible on medical treatment issues. Since the reports are neither treating physician reports nor validly obtained medical legal reports, they are not admissible.
“…Therefore, the non-MPN physician is not authorized to be a PTP, and accordingly, is not authorized to report or render an opinion on “medical issues necessary to determine the employee’s eligibility for compensation” under section 4061.5 and AD Rule 9785(d). (Cal. Code Regs. tit. 8, § 9785(d).) Moreover, for disputes involving temporary and/or permanent disability, neither an employee nor an employer are allowed to unilaterally seek a medical opinion to resolve the dispute, but must proceed under sections 4061 and 4062.[1] Accordingly, the non-MPN reports are not admissible to determine an applicant’s eligibility for compensation, e.g., temporary disability indemnity.”
In its decision the WCAB reviewed the statutory processes for challenging MPN physician by the employee. The Board noted employees have extensive rights with an MPN to challenge the opinion of a treating physician, none of which were utilized by the applicant in this case:
“…This was despite the fact that within the MPN she would have had several opportunities to challenge any treatment, diagnosis, or lack thereof with which she disagreed and treat with someone other than Dr. Nagamoto.
More specifically, after the initial medical evaluation arranged by the employer within the MPN pursuant to section 4616.3(a), “[t]he employer shall notify the employee of his or her right to be treated by a physician of his or her choice,” including “the method by which the list of participating providers may be accessed by the employee.” (Lab. Code § 4616.3(b); Cal. Code Regs., tit. 8, § 9767.6(d).) In addition, AD Rule 9767.6(e) (Cal. Code Regs., tit. 8, § 9767.6(e)) provides that “[a]t any point in time after the initial evaluation with a MPN physician, the covered employee may select a physician of his or her choice from within the MPN.”
Furthermore, pursuant to section 4616.3(c), where an injured worker “disputes either the diagnosis or treatment prescribed by the treating physician,” he or she “may seek the opinion of another physician in the [MPN],” and of “a third physician in the [MPN],” if the diagnosis or treatment of the second physician is disputed.”
The Board further noted even after these remedies had been exhausted, the employee could request an independent medical review of the treatment recommendations as a 4th level of dispute resolution.
The WCAB further considered whether the employee’s right to obtain an evaluation under Labor Code § 4605 with his or her own consulting physician rendered the reports admissible and rejected that idea. Relying on the previously stated reasoning regarding admissibility of reports under Labor Code § 4616.6 and 4061/4062 the majority ruled use of Labor Code § 4605 does not generate reports which meet the criterion of admissibility. The WCAB also included in its decision that such reports were not only inadmissible but not the financial obligation of the defendant. The case was remanded for the WCJ to make the determination on whether the employer had properly implemented the MPN.
Commissioner Brass dissented only to the extent the WCAB should not have a blanket rule such reports were never admissible, allowing a case by case consideration of when the reports might be relevant. Commissioner Caplane would have allowed non-MPN reports be admissible on compensation issues. She rationalized Labor Code § 4616.6 only excluded the reports on medical treatment issues and not allowing the reports into evidence effectively punished the employee and rendered the employee’s use of his own physician moot.
COMMENTS AND STRATEGIES:
This issue is one which has been commented on by several WCAB panel decisions with mixed results. Initial decisions commented such reports would be “unquestionably admissible”. Later decisions have seemed to back off that language (including a case commented on by the undersigned a few weeks ago – see my 3/30/11 “Power Press Exception & LC 4064 Nugget” for a discussion of the Scudder panel decision). In this decision, the WCAB has issued a definitive opinion which is now binding on all trial judge and WCAB panels. The WCAB appears to have recognized the inherent unfairness of allowing an employee to effectively buy his/her own report outside the medical legal process that is meant to apply to both sides.
An additional issue that will come up in cases where the employee has obtained treatment outside the MPN pursuant to Labor Code § 4605 is the potential lien claim of the physician for such treatment. I have been taking the position such treatment, which is clearly the responsibility of the employee, is still a lien on the employee’s benefits if the physician has filed a lien claims. I put the employee/applicant attorney on notice that my client will withhold sufficient sums from PD to cover the lien claim. Failure to do so, in the face of a lien may expose the employer to the treatment expenses. Where such a lien has been filed, it is imperative the claim not be resolved with the employer agreeing to hold the employee harmless on the lien claims. Such an agreement ultimately makes the employer responsible for the bill as it puts the employer in the employee’s position relative to the treatment bills. I have required the employee and his counsel to address the bills directly either by agreeing to pay from the settlement or else arrive at an agreement with the doctor for a disposition. However where there is no such agreement, distribution of the proceeds of settlement, in the face of a lien, can result in the employer being responsible for the treatment costs.
Needless to say, a critical part of this decision is the ability of the employer to prove a properly implemented MPN. Such proof requires the employer provide affirmative evidence regarding sending of MPN notices and posting of notices under Labor Code § 3550. Unfortunately providing such proof frequently requires the employer provide direct evidence of how the MPN was implemented, how notices were distributed and evidence of the proper postings (it is interesting that when employees testify they almost always claim the employer has never posted the Labor Code § 3550 notices and yet I have almost never walked into an employee break room without seeing them prominently posed on the wall).
Claims administrators should make an effort to get ahead of the curve on this issue and maintain an MPN Evidence file. That file should contain copies of all of the MPN notices, the procedures used to communicate the initial notices and a picture of the employer’s posting notices. It should also contain declarations under penalty of perjury by the person responsible for the MPN implementation describing the process followed to communicate the notices (whether by mail or provided in the employees’ paycheck as an example). A declaration under penalty of perjury regarding the employer posting notices can also be made by the employer’s safety officer or other party responsible for posting such notices. (Administrative Director Regulation §10114.2 allows such declarations to be admitted into evidence where properly served before trial.) In any case where the employee has challenged the employer/carrier’s MPN, this file, along with the actual notices sent to the employee at the time of injury, should suffice to document a properly implemented MPN and may avoid the need to provide live testimony especially if the issue arises at an expedited hearing. I have recently also taken the position the validity of an MPN is not an issue for an Expedited Hearing as it is not one of the enumerated issues for expedited hearing and decision. This can avoid the applicant testifying that notices were not received and postings not made without the employer having an opportunity to present its side of the case. However with a properly developed MPN Evidence file, even an Expedited hearing might result in a finding the MPN was properly noticed.
The deposition of an employee is also an opportunity to document the MPN implementation. It would be a good idea to confront the employee with a picture of the employer’s notices, which he might well remember once shown, as well as any copies of notices. One technique that can be used to confirm receipt of such notices is to include any releases the employee is asked to complete with the MPN notices. If the employee has returned the medical releases and history forms, it is difficult for him/her to claim they did not receive the other material in the same package.
The Valdez decision is here:
http://www.workcompcentral.com/pdf/2011/misc/valdez042011.pdf
Richard M. Jacobsmeyer is a founding partner of the Shaw, Jacobsmeyer, Crain & Claffey defense law firm, practicing in the Oakland.