BILL ANALYSIS �
AB 1687
Page 1
Date of Hearing: April 18, 2012
ASSEMBLY COMMITTEE ON INSURANCE
Jose Solorio, Chair
AB 1687 (Fong) - As Amended: March 12, 2012
SUBJECT : Workers compensation: medical treatment disputes
SUMMARY : Requires an employer or insurer to provide an
explanation of options for objecting to decisions to delay, deny
or modify medical treatment recommended by a treating physician,
and provides for compensation for attorneys in connection with
enforcing future medical treatment orders. Specifically, this
bill :
1)Requires, in connection with a utilization review (UR)
decision to delay, deny or modify medical treatment
recommended by a treating physician, that an employer or
insurer include a clear and concise explanation of the
available options for objecting to the delay, denial or
modification.
2)Requires the explanation to be in no less than 12-point bold
type on the first page of the communication to the injured
employee.
3)Authorizes the payment of reasonable attorneys fees where a
dispute arises concerning medical treatment where there has
been an award of future medical treatment and the applicant
has employed an attorney to enforce his or her rights.
EXISTING LAW :
1)Provides for a comprehensive system of workers' compensation
benefits for workers who are injured on the job, including
medical benefits.
2)Establishes a formal process, known as UR, to resolve disputes
concerning the appropriateness of medical treatment being
recommended for an injured worker.
3)Provides generally that attorneys representing injured workers
are paid as a percentage of the permanent disability award,
but does not expressly provide for compensation in
medical-only or in future medical cases.
AB 1687
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FISCAL EFFECT : Undetermined.
COMMENTS :
1)Purpose . According to the author, this bill is designed to
provide injured workers more information about how to navigate
the workers' compensation system in the event treatment
recommended by their treating physician is delayed, denied, or
modified, and to establish an appropriate incentive for
attorneys to take on "future medical" cases when the injured
worker requires the assistance of counsel.
2)Future medical awards . It is common in a workers'
compensation case to enter into settlement agreements that
resolve disability and retraining and other issues, but leave
future medical benefits open. This occurs when the parties
are unable or unwilling to make reasonable guesses about
future medical needs. That uncertainty, however, is not and
should not be a barrier to settlement of all other issues.
This is particularly true when there is a recognition that
future medical needs may last for years or for a lifetime.
It is unfortunately true that disputes can arise long after all
other matters have been resolved, often years after an
attorney has handled the case. In these circumstances, it is
frequently difficult or impossible for an injured worker to
find an attorney to assist in enforcing the award. If the
employer or insurer behavior is egregious enough, there is the
potential that attorney fees can be taken from penalties
imposed, but in the usual case, there is no provision for
attorney fees. The bill is designed to address this issue.
3)Opposition . Employers and insurers are opposed to the bill,
arguing that the additional notification requirements are
unduly complicating and costly additions to a UR system that
is performing a valuable function of preventing inappropriate
treatment that is not evidence-based, and which forces
treating physicians to practice evidence-based medicine
because the failure to provide proper documentation for
treatment requests will result in delays due simply to
inadequate medical information. They point out that there are
already enforcement provisions for unreasonable delays,
denials or modifications, but that good faith use of the UR
system should not be made more costly and burdensome. They
AB 1687
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argue that this bill creates more frictional costs of the very
sort we are trying to eliminate.
With respect to the attorney fees provision, they argue that it
will add costs to the system, and that the Division of
Workers' Compensation already has an Information and
Assistance Unit located in 24 places throughout California to
help injured workers in these sorts of cases.
REGISTERED SUPPORT / OPPOSITION :
Support
California Labor Federation
California Professional Firefighters
Organization of SMUD Employees
San Bernardino Public Employees Association
San Luis Obispo County Employees Association
Santa Rose City Employees Association
The Glendale City Employees Association,
Opposition
American Insurance Association
California Chamber of Commerce
California Coalition on Workers' Compensation
California State Association of Counties
Analysis Prepared by : Mark Rakich / INS. / (916) 319-2086