BILL ANALYSIS Ó
AB 2407
Page 1
Date of Hearing: May 4, 2016
ASSEMBLY COMMITTEE ON INSURANCE
Tom Daly, Chair
AB 2407
(Chávez) - As Amended ed April 27, 2016
SUBJECT: Workers' compensation
SUMMARY: Restates existing workers' compensation law that
requires treatment decisions to be based on the Medical
Treatment Utilization Schedule (MTUS). Specifically, this bill:
1)States that if an employee's injury affects his or her back,
the physician or other medical provider shall assess the
employee's level of risk for chronic back pain utilizing MTUS
regulations, and determine treatment based on these
regulations.
EXISTING LAW:
1)Provides for a comprehensive system of employer-paid benefits
for employees who suffer injuries or conditions that arise out
of or occur in the course of employment, including the
provision of medical benefits designed to cure and relieve the
effects of the injury or condition.
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2)Requires the Administrative Director (AD) of the Division of
Workers' Compensation (DWC) to establish an MTUS, which
governs the determination of the appropriate treatment to be
provided to injured workers.
3)Limits, under most circumstances, the total number of
chiropractic treatments for a particular injury at 24 visits.
4)Provides that, if the 24-visit cap has been reached, a
chiropractor may no longer serve in the role of primary
treating physician for an injured worker.
FISCAL EFFECT: Undetermined but potentially significant
increased litigation costs. This would impact DWC and Workers'
Compensation Appeals Board (WCAB) operations, as well as direct
state costs for the state's workers' compensation program.
COMMENTS:
1)Purpose . According to the author, ever since the 2004
workers' compensation reforms, which included a cap of 24
visits for chiropractic treatment, injured workers' have been
negatively impacted. Coupled with the more recent limitation
on chiropractors serving as primary treating physicians, there
has been an alarming increase in opioid use and surgery for
injured workers, with negative results.
2)MTUS . It is already the law that the MTUS is the set of
treatment guidelines that govern determinations of the
appropriate treatment for injured workers, and there is
general agreement that surgical intervention is a last resort.
The MTUS is structured, particularly with respect to back and
neck injuries, to default to conservative treatment in an
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effort to avoid the more serious consequences of surgery, and
the risk of permanent complications due to surgery. According
to the sponsors of the bill, this default to conservative
treatment is frequently ignored, and surgical options are
provided far too soon and far too often. They have pointed to
various academic and anecdotal indicators that surgery may not
provide the best long-term results for many back injuries.
The bill, they argue, merely reinforces the need to carefully
evaluate conservative treatment options before considering
surgical interventions.
This view of the system rushing toward surgery is not held by
all stakeholders. Representatives of injured workers have
complained of a system that is far too slow to authorize
needed care, and too much reliance on less expensive
conservative care. In any event, if an injured worker
believes that the particular care being recommended is not
appropriate, or is in violation of the MTUS, there are
administrative remedies to challenge that care. In a similar
vein, if an employer believes that expensive or risky surgery
is being recommended that violates the MTUS or is not in the
injured worker's best interests, the utilization review
process is designed as a means to test the appropriateness of
the recommended Schneider care. It is not clear how this
proposal improves any of these processes.
The bill's premise appears to be that the MTUS is not being
followed, and workers' compensation health care providers, and
the utilization review systems, need to be reminded to do so.
However, it has not been established with any rigorous study
that the MTUS is being ignored, nor, if it is, what remedial
measures would be most effective.
3)Rules of statutory construction . There is a great risk of
uncertainty, and resulting litigation, by enacting legislation
that appears to be a restatement of existing law. As noted by
some of the bill's opponents, the bill could "cause a
statutory conflict that would have to subsequently be worked
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out in the courts. That does not simplify the delivery of
medical treatment; it creates further delay for the employer
and the injured worker."
One of the primary rules courts use in attempting to determine
the meaning of statutory changes is that the Legislature does
not engage in idle acts. If there are statutory changes, they
must mean something, and courts will search to determine what
that meaning might be. Thus, even a seemingly innocuous
restatement of existing law can generate litigation, and
potentially unintended results.
Other rules of statutory construction may also generate
litigation and unintended results. For example, one rule of
statutory construction is that a later enacted statute
controls over a previous enactment if there is conflict
between the two or if they both govern the same issue. With
respect to AB 2407, the MTUS does not contain the 24 visit cap
on chiropractic care. Does this bill impliedly trump the
earlier enacted cap? Another rule of statutory construction
provides that a specific statute controls over a general
statute when both could be applicable. Would the specific cap
would trump the general MTUS statute. Would the specific
chronic back pain rule proposed by the bill trump the
generally applicable cap? It is this very uncertainty that
leads opponents to raise the fear of unnecessary litigation as
a reason that AB 2407 does not propose an appropriate
amendment to current law.
4)Opioid use . Proponents correctly assert that opioids should
not be the first line of treatment for chronic back pain.
Indeed, while opioids are an accepted treatment for
short-term, acute back pain, it is not considered an
appropriate treatment in most cases of chronic back pain. It
is well documented that opioid use and abuse are serious
health issues, not only in workers' compensation, but
throughout the healthcare systems in this country. For this
reason, the DWC has devoted substantial efforts over a long
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period of time to develop new pain guidelines designed to
better control over use of opioids. But even as these
guidelines were being developed, opioid use appears to be
moving in the right direction. According to recent
information from one of the largest pharmacy benefit managers,
opioid prescriptions in workers' compensation have been
declining. This is not to argue that what some describe as an
epidemic of opioid abuse has been overcome, but it is not
clear how the bill's current proposal moves the issue forward.
On the other hand, the Legislature has recently enacted a
major tool to help control opioid abuse. AB 1124 (Perea) from
last year requires the AD to develop a prescription drug
formulary. That process is well underway at the DWC, and
there are strong reasons to believe this approach can have a
tremendously positive impact on inappropriate opioid use in
workers' compensation.
REGISTERED SUPPORT / OPPOSITION:
Support
California Chiropractic Association (CCA), Sponsor
California Acupuncture Association (CAA)
Board of Chiropractic Examiners (BCE)
Opposition
AB 2407
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Acclimation Insurance Management Services
ACIC Insurance
Allied Managed Care
ALPHA Fund
American Insurance Association
California Association of Joint Powers Authorities (CAJPA)
California Chamber of Commerce
California Coalition on Workers' Compensation (CCWC)
California Manufacturers & Technology Association
California Medical Association
California Orthopaedic Association
California Retailers Association
California Special Districts Association
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California State Association of Counties (CSAC)
CSAC Excess Insurance Authority
Greater Conjeo Valley Chamber of Commerce
League of California Cities
National Association of Mutual Insurance Companies
Southwest California Legislative Council
Zenith Insurance Company
Analysis Prepared by:Mark Rakich / INS. / (916) 319-2086