Amended in Senate April 18, 2013

Senate Bill No. 626

Introduced by Senator Beall

February 22, 2013

An act to amend Sections begin insert 75, end insert 4600, begin insert 4604.5, end insert 4610, 4610.6, 4616, and 4660.1 of the Labor Code, relating to workers’ compensation.

LEGISLATIVE COUNSEL’S DIGEST

SB 626, as amended, Beall. Workers’ compensation.

begin insert

Existing law establishes a worker’s compensation system, administered by the Administrative Director of the Division of Workers’ Compensation, to compensate an employee for injuries sustained in the course of his or her employment. Existing law creates the Commission on Health and Safety and Workers’ Compensation consisting of 8 voting members, that includes 4 voting members representing organized labor and 4 voting members representing employers.

end insert begin insert

This bill would increase the number of commission voting members to 10 by adding one voting member representing injured workers and one additional voting member representing employers, appointed by the Governor.

end insert

Existing begin delete law establishes a worker’s compensation system, administered by the Administrative Director of the Division of Workers’ Compensation, to compensate an employee for injuries sustained in the course of his or her employment. Existing end delete law generally provides for the reimbursement of medical providers for services rendered in connection with the treatment of a worker’s injury. Existing law authorizes, with some exceptions, the employee to be treated by a physician of his or her own choice or at a facility of his or her own choice after 30 days from the date the injury is reported. Existing law prohibits a chiropractor from being the treating physician after the employee has received the maximum number of chiropractic visits.

This bill would delete that begin delete provision and would instead provide that a physician, as defined, may remain the patient’s primary treating physician even if additional treatment has been denied as long as the physician complies with specified reporting requirements end delete begin insert prohibition end insert .

begin insert

Existing law requires that the recommended guidelines set forth in the medical treatment utilization schedule adopted by the administrative director be presumptively correct on the issue of extent and scope of medical treatment. Notwithstanding the medical treatment utilization schedule, for injuries occurring on and after January 1, 2004, an employee is entitled to no more than 24 chiropractic, 24 occupational therapy, and 24 physical therapy visits per industrial injury.

end insert begin insert

This bill would delete the limitation on chiropractic, occupational therapy, and physical therapy visits per industrial injury.

end insert

Existing law requires an employer to establish a medical treatment utilization review process and, in this regard, prohibits any person other than a licensed physician from modifying, delaying, or denying requests for authorization of medical treatment for reasons of medical necessity to cure and relieve. Existing law also provides for an independent medical review process to resolve disputes over a utilization review decision for injuries occurring on or after January 1, 2013, and for any decision that is communicated to the requesting physician on or after July 1, 2013, regardless of the date of injury.

This bill would revise these provisions to require that medical treatment utilization reviews and independent medical reviews be conducted by physicians or medical professionals, as applicable, who hold the same California license as the requesting physician. The bill would delete the requirement that begin insert an end insert independent medical review organization keep the names of the reviewers confidential in all communications with entities or individuals outside the independent medical review organization.

Existing law prohibits a workers’ compensation administrative law judge, the appeals board, or any higher court from making a determination of medical necessity contrary to the determination of the independent medical review organization.

This bill would delete that provision.

Existing law provides certain methods for determining workers’ compensation benefits payable to a worker or his or her dependents for purposes of permanent partial disability and permanent total disability for injuries occurring on or after January 1, 2013. Existing law requires that the nature of the physical injury or disfigurement, the occupation of the injured employee, and his or her age at the time of injury be taken into account in determining the percentages of permanent partial disability or permanent total disability. Existing law, with some exceptions, prohibits increases in impairment ratings for sleep dysfunction, sexual dysfunction, or psychiatric disorder, or any combination thereof, as specified.

This bill would delete the prohibition on increases in impairment ratings for psychiatric disorder and would make related changes.

Vote: majority. Appropriation: no. Fiscal committee:  begin delete no end delete begin insert yes end insert . State-mandated local program: no.

The people of the State of California do enact as follows:

begin insert

begin insert SECTION 1. end insert   

end insert

begin insert Section 75 of the end insert begin insert Labor Code end insert begin insert is amended to read: end insert

75.  

(a) There is in the department the Commission on Health
and Safety and Workers’ Compensation. The commission shall be
composed of begin delete eight end delete begin insert 10 end insert voting members. Four voting members shall
represent organized labor, begin insert one voting member shall represent
injured workers, end insert and begin delete four end delete begin insert five end insert voting members shall represent
employers. Not more than one employer member shall represent
public agencies. begin delete Two end delete begin insert Three end insert of the employer begin delete and end delete begin insert members, end insert two of
the labor members begin insert , and the member representing injured workers end insert
shall be appointed by the Governor. The Senate Committee on
Rules and the Speaker of the Assembly shall each appoint one
employer and one labor representative. The public employer
representative shall be appointed by the Governor. No action of
the commission shall be valid unless agreed to by a majority of
the membership and by not less than two members representing
organized labor and two members representing employers.

(b) The commission shall select one of the members representing
organized labor to chair the commission during the 1994 calendar
year, and thereafter the commission shall alternatively select an
employer and organized labor representative to chair the
commission for one-year terms.

(c) The initial terms of the members of the commission shall
be four years, and they shall hold office until the appointment of
a successor. However, the initial terms of one employer and one
labor member appointed by the Governor shall expire on December
31, 1995; the initial terms of the members appointed by the Senate
Committee on Rules shall expire December 31, 1996; the initial
terms of the members appointed by the Speaker of the Assembly
shall expire on December 31, 1997; and the initial term of one
employer and one labor member appointed by the Governor shall
expire on December 31, 1998. Any vacancy shall be filled by
appointment to the unexpired term.

(d) The commission shall meet every other month and upon the
call of the chair. Meetings shall be open to the public. Members
of the commission shall receive one hundred dollars ($100) for
each day of their actual attendance at meetings of the commission
and other official business of the commission and shall also receive
their actual and necessary traveling expenses incurred in the
performance of their duty as a member. Payment of per diem and
traveling expenses shall be made from the Workers’ Compensation
Administration Revolving Fund, when appropriated by the
Legislature.

begin delete SECTION 1. end delete
begin insert SEC. 2. end insert   

Section 4600 of the Labor Code is amended to read:

4600.  

(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
provision of 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 employer’s 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. begin delete A physician, as defined in Section
3209.3, may remain the employee’s primary treating physician
even if additional medical treatment, as specified in the medical
treatment utilization schedule adopted under Section 5307.27, has
been denied, as long as the physician complies with the reporting
requirements set forth by the administrative director. end delete

(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 employee’s 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 employee’s primary care physician and has
previously directed the medical treatment of the employee, and
who retains the employee’s 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 employer’s
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 employee’s 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 employer’s 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.
The employer shall not be liable for home health care services that
are provided more than 14 days prior to the date of the employer’s
receipt of the physician’s prescription.

begin insert

begin insert SEC. 3. end insert   

end insert

begin insert Section 4604.5 of the end insert begin insert Labor Code end insert begin insert is amended to read: end insert

4604.5.  

(a) The recommended guidelines set forth in the
medical treatment utilization schedule adopted by the
administrative director pursuant to Section 5307.27 shall be
presumptively correct on the issue of extent and scope of medical
treatment. The presumption is rebuttable and may be controverted
by a preponderance of the scientific medical evidence establishing
that a variance from the guidelines reasonably is required to cure
or relieve the injured worker from the effects of his or her injury.
The presumption created is one affecting the burden of proof.

(b) The recommended guidelines set forth in the schedule
adopted pursuant to subdivision (a) shall reflect practices that are
evidence and scientifically based, nationally recognized, and peer
reviewed. The guidelines shall be designed to assist providers by
offering an analytical framework for the evaluation and treatment
of injured workers, and shall constitute care in accordance with
Section 4600 for all injured workers diagnosed with industrial
conditions.

begin delete

(c) (1) Notwithstanding the medical treatment utilization
schedule, for injuries occurring on and after January 1, 2004, an
employee shall be entitled to no more than 24 chiropractic, 24
occupational therapy, and 24 physical therapy visits per industrial
injury.

(2) (A) Paragraph (1) shall not apply when an employer
authorizes, in writing, additional visits to a health care practitioner
for physical medicine services. Payment or authorization for
treatment beyond the limits set forth in paragraph (1) shall not be
deemed a waiver of the limits set forth by paragraph (1) with
respect to future requests for authorization.

(B) The Legislature finds and declares that the amendments
made to subparagraph (A) by the act adding this subparagraph are
declaratory of existing law.

(3) Paragraph (1) shall not apply to visits for postsurgical
physical medicine and postsurgical rehabilitation services provided
in compliance with a postsurgical treatment utilization schedule
established by the administrative director pursuant to Section
5307.27.

(d)

end delete

begin insert (c) end insert  For all injuries not covered by the official utilization schedule
adopted pursuant to Section 5307.27, authorized treatment shall
be in accordance with other evidence-based medical treatment
guidelines that are recognized generally by the national medical
community and scientifically based.

begin delete SEC. 2. end delete
begin insert SEC. 4. end insert   

Section 4610 of the Labor Code is amended to read:

4610.  

(a) For purposes of this section, “utilization review”
means utilization review or utilization management functions that
prospectively, retrospectively, or concurrently review and approve,
modify, delay, or deny, based in whole or in part on medical
necessity to cure and relieve, treatment recommendations by
physicians, as defined in Section 3209.3, prior to, retrospectively,
or concurrent with the provision of medical treatment services
pursuant to Section 4600.

(b) Every employer shall establish a utilization review process
in compliance with this section, either directly or through its insurer
or an entity with which an employer or insurer contracts for these
services.

(c) Each utilization review process shall be governed by written
policies and procedures. These policies and procedures shall ensure
that decisions based on the medical necessity to cure and relieve
of proposed medical treatment services are consistent with the
schedule for medical treatment utilization adopted pursuant to
Section 5307.27. These policies and procedures, and a description
of the utilization process, shall be filed with the administrative
director and shall be disclosed by the employer to employees,
physicians, and the public upon request.

(d) If an employer, insurer, or other entity subject to this section
requests medical information from a physician in order to
determine whether to approve, modify, delay, or deny requests for
authorization, the employer shall request only the information
reasonably necessary to make the determination. The employer,
insurer, or other entity shall employ or designate a medical director
who holds an unrestricted license to practice medicine in this state
issued pursuant to Section 2050 or Section 2450 of the Business
and Professions Code. The medical director shall ensure that the
process by which the employer or other entity reviews and
approves, modifies, delays, or denies requests by physicians prior
to, retrospectively, or concurrent with the provision of medical
treatment services, complies with the requirements of this section.
Nothing in this section shall be construed as restricting the existing
authority of the Medical Board of California.

(e) No person other than a physician who holds the same
California license as that held by the requesting physician who is
competent to evaluate the specific clinical issues involved in the
medical treatment services, and where these services are within
the scope of the physician’s practice, requested by the physician
may modify, delay, or deny requests for authorization of medical
treatment for reasons of medical necessity to cure and relieve.

(f) The criteria or guidelines used in the utilization review
process to determine whether to approve, modify, delay, or deny
medical treatment services shall be all of the following:

(1) Developed with involvement from actively practicing
physicians.

(2) Consistent with the schedule for medical treatment utilization
adopted pursuant to Section 5307.27.

(3) Evaluated at least annually, and updated if necessary.

(4) Disclosed to the physician and the employee, if used as the
basis of a decision to modify, delay, or deny services in a specified
case under review.

(5) Available to the public upon request. An employer shall
only be required to disclose the criteria or guidelines for the
specific procedures or conditions requested. An employer may
charge members of the public reasonable copying and postage
expenses related to disclosing criteria or guidelines pursuant to
this paragraph. Criteria or guidelines may also be made available
through electronic means. No charge shall be required for an
employee whose physician’s request for medical treatment services
is under review.

(g) In determining whether to approve, modify, delay, or deny
requests by physicians prior to, retrospectively, or concurrent with
the provisions of medical treatment services to employees all of
the following requirements shall be met:

(1) Prospective or concurrent decisions shall be made in a timely
fashion that is appropriate for the nature of the employee’s
condition, not to exceed five working days from the receipt of the
information reasonably necessary to make the determination, but
in no event more than 14 days from the date of the medical
treatment recommendation by the physician. In cases where the
review is retrospective, a decision resulting in denial of all or part
of the medical treatment service shall be communicated to the
individual who received services, or to the individual’s designee,
within 30 days of receipt of information that is reasonably
necessary to make this determination. If payment for a medical
treatment service is made within the time prescribed by Section
4603.2, a retrospective decision to approve the service need not
otherwise be communicated.

(2) When the employee’s condition is such that the employee
faces an imminent and serious threat to his or her health, including,
but not limited to, the potential loss of life, limb, or other major
bodily function, or the normal timeframe for the decisionmaking
process, as described in paragraph (1), would be detrimental to the
employee’s life or health or could jeopardize the employee’s ability
to regain maximum function, decisions to approve, modify, delay,
or deny requests by physicians prior to, or concurrent with, the
provision of medical treatment services to employees shall be made
in a timely fashion that is appropriate for the nature of the
employee’s condition, but not to exceed 72 hours after the receipt
of the information reasonably necessary to make the determination.

(3) (A) Decisions to approve, modify, delay, or deny requests
by physicians for authorization prior to, or concurrent with, the
provision of medical treatment services to employees shall be
communicated to the requesting physician within 24 hours of the
decision. Decisions resulting in modification, delay, or denial of
all or part of the requested health care service shall be
communicated to physicians initially by telephone or facsimile,
and to the physician and employee in writing within 24 hours for
concurrent review, or within two business days of the decision for
prospective review, as prescribed by the administrative director.
If the request is not approved in full, disputes shall be resolved in
accordance with Section 4610.5, if applicable, or otherwise in
accordance with Section 4062.

(B) In the case of concurrent review, medical care shall not be
discontinued until the employee’s physician has been notified of
the decision and a care plan has been agreed upon by the physician
that is appropriate for the medical needs of the employee. Medical
care provided during a concurrent review shall be care that is
medically necessary to cure and relieve, and an insurer or
self-insured employer shall only be liable for those services
determined medically necessary to cure and relieve. If the insurer
or self-insured employer disputes whether or not one or more
services offered concurrently with a utilization review were
medically necessary to cure and relieve, the dispute shall be
resolved pursuant to Section 4610.5, if applicable, or otherwise
pursuant to Section 4062. Any compromise between the parties
that an insurer or self-insured employer believes may result in
payment for services that were not medically necessary to cure
and relieve shall be reported by the insurer or the self-insured
employer to the licensing board of the provider or providers who
received the payments, in a manner set forth by the respective
board and in such a way as to minimize reporting costs both to the
board and to the insurer or self-insured employer, for evaluation
as to possible violations of the statutes governing appropriate
professional practices. No fees shall be levied upon insurers or
self-insured employers making reports required by this section.

(4) Communications regarding decisions to approve requests
by physicians shall specify the specific medical treatment service
approved. Responses regarding decisions to modify, delay, or deny
medical treatment services requested by physicians shall include
a clear and concise explanation of the reasons for the employer’s
decision, a description of the criteria or guidelines used, and the
clinical reasons for the decisions regarding medical necessity. If
a utilization review decision to deny or delay a medical service is
due to incomplete or insufficient information, the decision shall
specify the reason for the decision and specify the information that
is needed.

(5) If the employer, insurer, or other entity cannot make a
decision within the timeframes specified in paragraph (1) or (2)
because the employer or other entity is not in receipt of all of the
information reasonably necessary and requested, because the
employer requires consultation by an expert reviewer, or because
the employer has asked that an additional examination or test be
performed upon the employee that is reasonable and consistent
with good medical practice, the employer shall immediately notify
the physician and the employee, in writing, that the employer
cannot make a decision within the required timeframe, and specify
the information requested but not received, the expert reviewer to
be consulted, or the additional examinations or tests required. The
employer shall also notify the physician and employee of the
anticipated date on which a decision may be rendered. Upon receipt
of all information reasonably necessary and requested by the
employer, the employer shall approve, modify, or deny the request
for authorization within the timeframes specified in paragraph (1)
or (2).

(6) A utilization review decision to modify, delay, or deny a
treatment recommendation shall remain effective for 12 months
from the date of the decision without further action by the employer
with regard to any further recommendation by the same physician
for the same treatment unless the further recommendation is
supported by a documented change in the facts material to the
basis of the utilization review decision.

(7) Utilization review of a treatment recommendation shall not
be required while the employer is disputing liability for injury or
treatment of the condition for which treatment is recommended
pursuant to Section 4062.

(8) If utilization review is deferred pursuant to paragraph (7),
and it is finally determined that the employer is liable for treatment
of the condition for which treatment is recommended, the time for
the employer to conduct retrospective utilization review in
accordance with paragraph (1) shall begin on the date the
determination of the employer’s liability becomes final, and the
time for the employer to conduct prospective utilization review
shall commence from the date of the employer’s receipt of a
treatment recommendation after the determination of the
employer’s liability.

(h) Every employer, insurer, or other entity subject to this section
shall maintain telephone access for physicians to request
authorization for health care services.

(i) If the administrative director determines that the employer,
insurer, or other entity subject to this section has failed to meet
any of the timeframes in this section, or has failed to meet any
other requirement of this section, the administrative director may
assess, by order, administrative penalties for each failure. A
proceeding for the issuance of an order assessing administrative
penalties shall be subject to appropriate notice to, and an
opportunity for a hearing with regard to, the person affected. The
administrative penalties shall not be deemed to be an exclusive
remedy for the administrative director. These penalties shall be
deposited in the Workers’ Compensation Administration Revolving
Fund.

begin delete SEC. 3. end delete
begin insert SEC. 5. end insert   

Section 4610.6 of the Labor Code is amended to read:

4610.6.  

(a) Upon receipt of a case pursuant to Section 4610.5,
an independent medical review organization shall conduct the
review in accordance with this article and any regulations or orders
of the administrative director. The organization’s review shall be
limited to an examination of the medical necessity of the disputed
medical treatment.

(b) Upon receipt of information and documents related to a case,
the medical reviewer or reviewers selected to conduct the review
by the independent medical review organization shall promptly
review all pertinent medical records of the employee, provider
reports, and any other information submitted to the organization
or requested from any of the parties to the dispute by the reviewers.
If the reviewers request information from any of the parties, a copy
of the request and the response shall be provided to all of the
parties. The reviewer or reviewers shall also review relevant
information related to the criteria set forth in subdivision (c).

(c) Following its review, the reviewer or reviewers shall
determine whether the disputed health care service was medically
necessary based on the specific medical needs of the employee
and the standards of medical necessity as defined in subdivision
(c) of Section 4610.5.

(d) The organization shall complete its review and make its
determination in writing, and in layperson’s terms to the maximum
extent practicable, within 30 days of the receipt of the request for
review and supporting documentation, or within less time as
prescribed by the administrative director. If the disputed medical
treatment has not been provided and the employee’s provider or
the administrative director certifies in writing that an imminent
and serious threat to the health of the employee may exist,
including, but not limited to, serious pain, the potential loss of life,
limb, or major bodily function, or the immediate and serious
deterioration of the health of the employee, the analyses and
determinations of the reviewers shall be expedited and rendered
within three days of the receipt of the information. Subject to the
approval of the administrative director, the deadlines for analyses
and determinations involving both regular and expedited reviews
may be extended for up to three days in extraordinary
circumstances or for good cause.

(e) The medical professionals’ analyses and determinations shall
state whether the disputed health care service is medically
necessary. Each analysis shall cite the employee’s medical
condition, the relevant documents in the record, and the relevant
findings associated with the provisions of subdivision (c) to support
the determination. If more than one medical professional reviews
the case, the recommendation of the majority shall prevail. If the
medical professionals reviewing the case are evenly split as to
whether the disputed health care service should be provided, the
decision shall be in favor of providing the service.

(f) The independent medical review organization shall provide
the administrative director, the employer, the employee, and the
employee’s provider with the analyses and determinations of the
medical professionals reviewing the case, and a description of the
qualifications of the medical professionals. Independent medical
reviews shall be conducted by medical professionals who hold the
same California license as the requesting physician. If more than
one medical professional reviewed the case and the result was
differing determinations, the independent medical review
organization shall provide each of the separate reviewer’s analyses
and determinations.

(g) The determination of the independent medical review
organization shall be deemed to be the determination of the
administrative director and shall be binding on all parties.

(h) A determination of the administrative director pursuant to
this section may be reviewed only by a verified appeal from the
medical review determination of the administrative director, filed
with the appeals board for hearing pursuant to Chapter 3
(commencing with Section 5500) of Part 4 and served on all
interested parties within 30 days of the date of mailing of the
determination to the aggrieved employee or the aggrieved
employer. The determination of the administrative director shall
be presumed to be correct and shall be set aside only upon proof
by clear and convincing evidence of one or more of the following
grounds for appeal:

(1) The administrative director acted without or in excess of the
administrative director’s powers.

(2) The determination of the administrative director was
procured by fraud.

(3) The independent medical reviewer was subject to a material
conflict of interest that is in violation of Section 139.5.

(4) The determination was the result of bias on the basis of race,
national origin, ethnic group identification, religion, age, sex,
sexual orientation, color, or disability.

(5) The determination was the result of a plainly erroneous
express or implied finding of fact, provided that the mistake of
fact is a matter of ordinary knowledge based on the information
submitted for review pursuant to Section 4610.5 and not a matter
that is subject to expert opinion.

(i) If the determination of the administrative director is reversed,
the dispute shall be remanded to the administrative director to
submit the dispute to independent medical review by a different
independent review organization. In the event that a different
independent medical review organization is not available after
remand, the administrative director shall submit the dispute to the
original medical review organization for review by a different
reviewer in the organization.

(j) Upon receiving the determination of the administrative
director that a disputed health care service is medically necessary,
the employer shall promptly implement the decision as provided
by this section unless the employer has also disputed liability for
any reason besides medical necessity. In the case of reimbursement
for services already rendered, the employer shall reimburse the
provider or employee, whichever applies, within 20 days, subject
to resolution of any remaining issue of the amount of payment
pursuant to Sections 4603.2 to 4603.6, inclusive. In the case of
services not yet rendered, the employer shall authorize the services
within five working days of receipt of the written determination
from the independent medical review organization, or sooner if
appropriate for the nature of the employee’s medical condition,
and shall inform the employee and provider of the authorization.

(k) Failure to pay for services already provided or to authorize
services not yet rendered within the time prescribed by subdivision
(l) is a violation of this section and, in addition to any other fines,
penalties, and other remedies available to the administrative
director, the employer shall be subject to an administrative penalty
in an amount determined pursuant to regulations to be adopted by
the administrative director, not to exceed five thousand dollars
($5,000) for each day the decision is not implemented. The
administrative penalties shall be paid to the Workers’
Compensation Administration Revolving Fund.

(l) The costs of independent medical review and the
administration of the independent medical review system shall be
borne by employers through a fee system established by the
administrative director. After considering any relevant information
on program costs, the administrative director shall establish a
reasonable, per-case reimbursement schedule to pay the costs of
independent medical review organization reviews and the cost of
administering the independent medical review system, which may
vary depending on the type of medical condition under review and
on other relevant factors.

(m) The administrative director may publish the results of
independent medical review determinations after removing
individually identifiable information.

(n) If any provision of this section, or the application thereof to
any person or circumstances, is held invalid, the remainder of the
section, and the application of its provisions to other persons or
circumstances, shall not be affected thereby.

begin delete SEC. 4. end delete
begin insert SEC. 6. end insert   

Section 4616 of the Labor Code is amended to read:

4616.  

(a) (1) On or after January 1, 2005, an insurer, employer,
or entity that provides physician network services may establish
or modify a medical provider network for the provision of medical
treatment to injured employees. The network shall include
physicians primarily engaged in the treatment of occupational
injuries. The administrative director shall encourage the integration
of occupational and nonoccupational providers. The number of
physicians in the medical provider network shall be sufficient to
enable treatment for injuries or conditions to be provided in a
timely manner. The provider network shall include an adequate
number and type of physicians, as described in Section 3209.3, or
other providers, as described in Section 3209.5, to treat common
injuries experienced by injured employees based on the type of
occupation or industry in which the employee is engaged, and the
geographic area where the employees are employed.

(2) Medical treatment for injuries shall be readily available at
reasonable times to all employees. To the extent feasible, all
medical treatment for injuries shall be readily accessible to all
employees. With respect to availability and accessibility of
treatment, the administrative director shall consider the needs of
rural areas, specifically those in which health facilities are located
at least 30 miles apart and areas in which there is a health care
shortage.

(3) Commencing January 1, 2014, a treating physician shall be
included in the network only if, at the time of entering into or
renewing an agreement by which the physician would be in the
network, the physician, or an authorized employee of the physician
or the physician’s office, provides a separate written
acknowledgment in which the physician affirmatively elects to be
a member of the network. Copies of the written acknowledgment
shall be provided to the administrative director upon the
administrative director’s request. This paragraph shall not apply
to a physician who is a shareholder, partner, or employee of a
medical group that elects to be part of the network.

(4) Commencing January 1, 2014, every medical provider
network shall post on its Internet Web site a roster of all treating
physicians in the medical provider network and shall update the
roster at least quarterly. Every network shall provide to the
administrative director the Internet Web site address of the network
and of its roster of treating physicians. The administrative director
shall post, on the division’s Internet Web site, the Internet Web
site address of every approved medical provider network.

(5) Commencing January 1, 2014, every medical provider
network shall provide one or more persons within the United States
to serve as medical access assistants to help an injured employee
find an available physician of the employee’s choice, and
subsequent physicians if necessary, under Section 4616.3. Medical
access assistants shall have a toll-free telephone number that
injured employees may use and shall be available at least from 7
a.m. to 8 p.m. Pacific Standard Time, Monday through Saturday,
inclusive, to respond to injured employees, contact physicians’
offices during regular business hours, and schedule appointments.
The administrative director shall promulgate regulations on or
before July 1, 2013, governing the provision of medical access
assistants.

(b) (1) An insurer, employer, or entity that provides physician
network services shall submit a plan for the medical provider
network to the administrative director for approval. The
administrative director shall approve the plan for a period of four
years if he or she determines that the plan meets the requirements
of this section. If the administrative director does not act on the
plan within 60 days of submitting the plan, it shall be deemed
approved. Commencing January 1, 2014, existing approved plans
shall be deemed approved for a period of four years from the most
recent application or modification approval date. Plans for
reapproval for medical provider networks shall be submitted at
least six months before the expiration of the four-year approval
period. Upon a showing that the medical provider network was
approved or deemed approved by the administrative director, there
shall be a conclusive presumption on the part of the appeals board
that the medical provider network was validly formed.

(2) Every medical provider network shall establish and follow
procedures to continuously review the quality of care, performance
of medical personnel, utilization of services and facilities, and
costs.

(3) Every medical provider network shall submit geocoding of
its network for reapproval to establish that the number and
geographic location of physicians in the network meets the required
access standards.

(4) The administrative director shall at any time have the
discretion to investigate complaints and to conduct random reviews
of approved medical provider networks.

(5) Approval of a plan may be denied, revoked, or suspended
if the medical provider network fails to meet the requirements of
this article. Any person contending that a medical provider network
is not validly constituted may petition the administrative director
to suspend or revoke the approval of the medical provider network.
The administrative director may adopt regulations establishing a
schedule of administrative penalties not to exceed five thousand
dollars ($5,000) per violation, or probation, or both, in lieu of
revocation or suspension for less severe violations of the
requirements of this article. Penalties, probation, suspension, or
revocation shall be ordered by the administrative director only
after notice and opportunity to be heard. Unless suspended or
revoked by the administrative director, the administrative director’s
approval of a medical provider network shall be binding on all
persons and all courts. A determination of the administrative
director may be reviewed only by an appeal of the determination
of the administrative director filed as an original proceeding before
the reconsideration unit of the workers’ compensation appeals
board on the same grounds and within the same time limits after
issuance of the determination as would be applicable to a petition
for reconsideration of a decision of a workers’ compensation
administrative law judge.

(c) Physician compensation may not be structured in order to
achieve the goal of reducing, delaying, or denying medical
treatment or restricting access to medical treatment.

(d) If the employer or insurer meets the requirements of this
section, the administrative director may not withhold approval or
disapprove an employer’s or insurer’s medical provider network
based solely on the selection of providers. In developing a medical
provider network, an employer or insurer shall have the exclusive
right to determine the members of their network.

(e) All treatment provided shall be provided in accordance with
the medical treatment utilization schedule established pursuant to
Section 5307.27.

(f) No person other than a physician who holds the same
California license as the requesting physician who is competent
to evaluate the specific clinical issues involved in the medical
treatment services, when these services are within the scope of the
physician’s practice, may modify, delay, or deny requests for
authorization of medical treatment.

(g) Commencing January 1, 2013, every contracting agent that
sells, leases, assigns, transfers, or conveys its medical provider
networks and their contracted reimbursement rates to an insurer,
employer, entity that provides physician network services, or
another contracting agent shall, upon entering or renewing a
provider contract, disclose to the provider whether the medical
provider network may be sold, leased, transferred, or conveyed to
other insurers, employers, entities that provide physician network
services, or another contracting agent, and specify whether those
insurers, employers, entities that provide physician network
services, or contracting agents include workers’ compensation
insurers.

(h) On or before November 1, 2004, the administrative director,
in consultation with the Department of Managed Health Care, shall
adopt regulations implementing this article. The administrative
director shall develop regulations that establish procedures for
purposes of making medical provider network modifications.

begin delete SEC. 5. end delete
begin insert SEC. 7. end insert   

Section 4660.1 of the Labor Code is amended to read:

4660.1.  

This section shall apply to injuries occurring on or
after January 1, 2013.

(a) In determining the percentages of permanent partial or
permanent total disability, account shall be taken of the nature of
the physical injury or disfigurement, the occupation of the injured
employee, and his or her age at the time of injury.

(b) For purposes of this section, the “nature of the physical
injury or disfigurement” shall incorporate the descriptions and
measurements of physical impairments and the corresponding
percentages of impairments published in the American Medical
Association (AMA) Guides to the Evaluation of Permanent
Impairment (5th edition) with the employee’s whole person
impairment, as provided in the guides, multiplied by an adjustment
factor of 1.4.

(c) There shall be no increases in impairment ratings for sleep
dysfunction or sexual dysfunction, or both, arising out of a
compensable physical injury. Nothing in this section shall limit
the ability of an injured employee to obtain treatment for sleep
dysfunction or sexual dysfunction, if any, that are a consequence
of an industrial injury.

(d) The administrative director may formulate a schedule of age
and occupational modifiers and may amend the schedule for the
determination of the age and occupational modifiers in accordance
with this section. The Schedule for Rating Permanent Disabilities
pursuant to the American Medical Association (AMA) Guides to
the Evaluation of Permanent Impairment (5th edition) and the
schedule of age and occupational modifiers shall be available for
public inspection and, without formal introduction in evidence,
shall be prima facie evidence of the percentage of permanent
disability to be attributed to each injury covered by the schedule.
Until the schedule of age and occupational modifiers is amended,
for injuries occurring on or after January 1, 2013, permanent
disabilities shall be rated using the age and occupational modifiers
in the permanent disability rating schedule adopted as of January
1, 2005.

(e) The schedule of age and occupational modifiers shall
promote consistency, uniformity, and objectivity.

(f) The schedule of age and occupational modifiers and any
amendment thereto or revision thereof shall apply prospectively
and shall apply to and govern only those permanent disabilities
that result from compensable injuries received or occurring on and
after the effective date of the adoption of the schedule, amendment,
or revision, as the case may be.

(g) Nothing in this section shall preclude a finding of permanent
total disability in accordance with Section 4662.

(h) In enacting the act adding this section, it is not the intent of
the Legislature to overrule the holding in Milpitas Unified School
District v. Workers’ Comp. Appeals Bd. (Guzman) (2010) 187
Cal.App.4th 808.

(i) The Commission on Health and Safety and Workers’
Compensation shall conduct a study to compare average loss of
earnings for employees who sustained work-related injuries with
permanent disability ratings under the schedule, and shall report
the results of the study to the appropriate policy and fiscal
committees of the Legislature no later than January 1, 2016.