BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                    SB 1175


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          Date of Hearing:  June 22, 2016


                           ASSEMBLY COMMITTEE ON INSURANCE


                                   Tom Daly, Chair


          SB  
          1175 (Mendoza) - As Amended June 14, 2016


          SENATE VOTE:  36-0


          SUBJECT:  Workers' compensation: requests for payment


          SUMMARY:  Requires providers of medical services in the workers'  
          compensation system to submit bills within 12 months of  
          providing the services.  Specifically, this bill:  


          1)Requires that, for treatment provided on or after January 1,  
            2017, a medical provider must submit the request for payment  
            within 12 months of the date of service or 12 months of the  
            date of discharge for inpatient facility services.


          2)Requires that, for medical-legal services or expenses, the  
            request for payment must be submitted within 12 months of the  
            date of service.


          3)Requires the administrative director (AD) of the Division of  
            Workers' Compensation (DWC) to adopt rules and regulations to  
            implement the 12 month limitation period for both medical  
            charges and medical-legal charges, including circumstances  








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            that constitute good cause for an exception to the 12 month  
            period, including procedures for billing in cases when  
            treatment of injuries thought to be non-industrial turn out,  
            after 12 months, to be industrial injuries.


          4)Provides that, absent good cause, a request for payment after  
            the 12-month limitation period is barred.


          EXISTING LAW:   


          1)Establishes a comprehensive system to provide benefits,  
            including medical treatment, to employees who are injured or  
            suffer conditions that arise out of or in the course of  
            employment.


          2)Provides that 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.  


          3)Requires a medical provider who provides any of the medical  
            services described above for an injured worker to submit its  
            request for payment with an itemization of services provided  
            and the charge for each service, a copy of all reports showing  
            the services performed, the prescription or referral from the  
            primary treating physician if the services were performed by a  
            person other than the primary treating physician, and any  
            evidence of authorization for the services that may have been  
            received.










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          FISCAL EFFECT:  The Senate Appropriations Committee referred  
          this bill to the Senate Floor pursuant to Senate Rule 28.8.


          


          COMMENTS:  


          1)Purpose. According to the author, multiple stakeholders report  
            persistent fraudulent or unnecessarily belligerent billing  
            activity by some medical providers. One example is the  
            submission of medical bills more than a year after services  
            were provided. In some cases, the bills were old enough that  
            the underlying documentation may have been destroyed or would  
            be difficult for the employer to find. This can raise the  
            possibility of a medical employer being paid twice for  
            providing the same service. Additionally, processing old  
            medical bills can create frictional costs for payors, limiting  
            resources to injured workers and lawful medical providers.  

          In other medical systems, there are time limitations for when a  
            medical bill can be submitted for payment. In Medi-Cal, for  
            example, the limitation is 6 months. In Texas's workers'  
            compensation system, the medical bill submission time limit is  
            90 days.

          The bill would create a medical bill submission time limit of 12  
            months from date of service or 12 months of date of discharge  
            for inpatient facility services, which is the same as the  
            medical bill time limitations for Medicare.  The bill applies  
            a similar time limitation for medical-legal services, and  
            provides that the AD create good-cause exceptions to the 12  
            month limitation.

          REGISTERED SUPPORT / OPPOSITION:










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          Support


          ALPHA Fund


          Small Business California




          Opposition


          None received.




          Analysis Prepared by:Mark Rakich / INS. / (916)  
          319-2086