Bill Text: CA SB1175 | 2015-2016 | Regular Session | Chaptered
Bill Title: Workers' compensation: requests for payment.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Passed) 2016-08-26 - Chaptered by Secretary of State. Chapter 214, Statutes of 2016. [SB1175 Detail]
Download: California-2015-SB1175-Chaptered.html
BILL NUMBER: SB 1175 CHAPTERED
BILL TEXT
CHAPTER 214
FILED WITH SECRETARY OF STATE AUGUST 26, 2016
APPROVED BY GOVERNOR AUGUST 26, 2016
PASSED THE SENATE AUGUST 11, 2016
PASSED THE ASSEMBLY AUGUST 4, 2016
AMENDED IN ASSEMBLY JUNE 14, 2016
AMENDED IN SENATE APRIL 19, 2016
INTRODUCED BY Senator Mendoza
FEBRUARY 18, 2016
An act to amend Sections 4603.2, 4603.4, and 4625 of the Labor
Code, relating to workers' compensation.
LEGISLATIVE COUNSEL'S DIGEST
SB 1175, Mendoza. Workers' compensation: requests for payment.
Existing law establishes a workers' 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
requires the employer to provide medical, surgical, chiropractic,
acupuncture, and hospital treatment, as specified, that is reasonably
required to cure or relieve the injured worker from the effects of
his or her injury. Existing law requires a provider of those services
to submit, among other documents, its request for payment with an
itemization of services provided and the charge for each service.
Existing law also requires the employer to reimburse the employee for
his or her medical-legal expenses, as specified.
This bill would require, effective for services on or after
January 1, 2017, that requests for payment with an itemization of
services provided and the charge for each service be submitted to the
employer within 12 months of the date of service or within 12 months
of the date of discharge for inpatient facility services. The bill
would also require, effective for services provided on or after
January 1, 2017, that all bills for medical-legal evaluation or
medical-legal expense be submitted to the employer within 12 months
of the date of service in the manner prescribed by the administrative
director. The bill would provide that requests for payment and bills
for medical-legal charges are barred unless timely submitted. The
bill would require the administrative director to adopt rules to
implement the 12-month limitation period, as specified.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 4603.2 of the Labor Code is amended to read:
4603.2. (a) (1) Upon selecting a physician pursuant to Section
4600, the employee or physician shall notify the employer of the name
and address, including the name of the medical group, if applicable,
of the physician. The physician shall submit a report to the
employer within five working days from the date of the initial
examination, as required by Section 6409, and shall submit periodic
reports at intervals that may be prescribed by rules and regulations
adopted by the administrative director.
(2) If the employer objects to the employee's selection of the
physician on the grounds that the physician is not within the medical
provider network used by the employer, and there is a final
determination that the employee was entitled to select the physician
pursuant to Section 4600, the employee shall be entitled to continue
treatment with that physician at the employer's expense in accordance
with this division, notwithstanding Section 4616.2. The employer
shall be required to pay from the date of the initial examination if
the physician's report was submitted within five working days of the
initial examination. If the physician's report was submitted more
than five working days after the initial examination, the employer
and the employee shall not be required to pay for any services prior
to the date the physician's report was submitted.
(3) If the employer objects to the employee's selection of the
physician on the grounds that the physician is not within the medical
provider network used by the employer, and there is a final
determination that the employee was not entitled to select a
physician outside of the medical provider network, the employer shall
have no liability for treatment provided by or at the direction of
that physician or for any consequences of the treatment obtained
outside the network.
(b) (1) (A) A provider of services provided pursuant to Section
4600, including, but not limited to, physicians, hospitals,
pharmacies, interpreters, copy services, transportation services, and
home health care services, shall 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. This section does not prohibit an employer,
insurer, or third-party claims administrator from establishing,
through written agreement, an alternative manual or electronic
request for payment with providers for services provided pursuant to
Section 4600.
(B) Effective for services provided on or after January 1, 2017,
the request for payment with an itemization of services provided and
the charge for each service shall be submitted to the employer within
12 months of the date of service or within 12 months of the date of
discharge for inpatient facility services. The administrative
director shall adopt rules to implement the 12-month limitation
period. The rules shall define circumstances that constitute good
cause for an exception to the 12-month period, including provisions
to address the circumstances of a nonoccupational injury or illness
later found to be a compensable injury or illness. The request for
payment is barred unless timely submitted.
(C) Notwithstanding the requirements of this paragraph, a copy of
the prescription shall not be required with a request for payment for
pharmacy services, unless the provider of services has entered into
a written agreement, as provided in this paragraph, that requires a
copy of a prescription for a pharmacy service.
(D) This section does not preclude an employer, insurer, pharmacy
benefits manager, or third-party claims administrator from requesting
a copy of the prescription during a review of any records of
prescription drugs that were dispensed by a pharmacy.
(2) Except as provided in subdivision (d) of Section 4603.4, or
under contracts authorized under Section 5307.11, payment for medical
treatment provided or prescribed by the treating physician selected
by the employee or designated by the employer shall be made at
reasonable maximum amounts in the official medical fee schedule,
pursuant to Section 5307.1, in effect on the date of service.
Payments shall be made by the employer with an explanation of review
pursuant to Section 4603.3 within 45 days after receipt of each
separate, itemization of medical services provided, together with any
required reports and any written authorization for services that may
have been received by the physician. If the itemization or a portion
thereof is contested, denied, or considered incomplete, the
physician shall be notified, in the explanation of review, that the
itemization is contested, denied, or considered incomplete, within 30
days after receipt of the itemization by the employer. An
explanation of review that states an itemization is incomplete shall
also state all additional information required to make a decision. A
properly documented list of services provided and not paid at the
rates then in effect under Section 5307.1 within the 45-day period
shall be paid at the rates then in effect and increased by 15
percent, together with interest at the same rate as judgments in
civil actions retroactive to the date of receipt of the itemization,
unless the employer does both of the following:
(A) Pays the provider at the rates in effect within the 45-day
period.
(B) Advises, in an explanation of review pursuant to Section
4603.3, the physician, or another provider of the items being
contested, the reasons for contesting these items, and the remedies
available to the physician or the other provider if he or she
disagrees. In the case of an itemization that includes services
provided by a hospital, outpatient surgery center, or independent
diagnostic facility, advice that a request has been made for an audit
of the itemization shall satisfy the requirements of this paragraph.
An employer's liability to a physician or another provider under
this section for delayed payments shall not affect its liability to
an employee under Section 5814 or any other provision of this
division.
(3) Notwithstanding paragraph (1), if the employer is a
governmental entity, payment for medical treatment provided or
prescribed by the treating physician selected by the employee or
designated by the employer shall be made within 60 days after receipt
of each separate itemization, together with any required reports and
any written authorization for services that may have been received
by the physician.
(4) Duplicate submissions of medical services itemizations, for
which an explanation of review was previously provided, shall require
no further or additional notification or objection by the employer
to the medical provider and shall not subject the employer to any
additional penalties or interest pursuant to this section for failing
to respond to the duplicate submission. This paragraph shall apply
only to duplicate submissions and does not apply to any other
penalties or interest that may be applicable to the original
submission.
(c) Interest or an increase in compensation paid by an insurer
pursuant to this section shall be treated in the same manner as an
increase in compensation under subdivision (d) of Section 4650 for
the purposes of any classification of risks and premium rates, and
any system of merit rating approved or issued pursuant to Article 2
(commencing with Section 11730) of Chapter 3 of Part 3 of Division 2
of the Insurance Code.
(d) (1) Whenever an employer or insurer employs an individual or
contracts with an entity to conduct a review of an itemization
submitted by a physician or medical provider, the employer or insurer
shall make available to that individual or entity all documentation
submitted together with that itemization by the physician or medical
provider. When an individual or entity conducting an itemization
review determines that additional information or documentation is
necessary to review the itemization, the individual or entity shall
contact the claims administrator or insurer to obtain the necessary
information or documentation that was submitted by the physician or
medical provider pursuant to subdivision (b).
(2) An individual or entity reviewing an itemization of service
submitted by a physician or medical provider shall not alter the
procedure codes listed or recommend reduction of the amount of the
payment unless the documentation submitted by the physician or
medical provider with the itemization of service has been reviewed by
that individual or entity. If the reviewer does not recommend
payment for services as itemized by the physician or medical
provider, the explanation of review shall provide the physician or
medical provider with a specific explanation as to why the reviewer
altered the procedure code or changed other parts of the itemization
and the specific deficiency in the itemization or documentation that
caused the reviewer to conclude that the altered procedure code or
amount recommended for payment more accurately represents the service
performed.
(e) (1) If the provider disputes the amount paid, the provider may
request a second review within 90 days of service of the explanation
of review or an order of the appeals board resolving the threshold
issue as stated in the explanation of review pursuant to paragraph
(5) of subdivision (a) of Section 4603.3. The request for a second
review shall be submitted to the employer on a form prescribed by the
administrative director and shall include all of the following:
(A) The date of the explanation of review and the claim number or
other unique identifying number provided on the explanation of
review.
(B) The item and amount in dispute.
(C) The additional payment requested and the reason therefor.
(D) The additional information provided in response to a request
in the first explanation of review or any other additional
information provided in support of the additional payment requested.
(2) If the only dispute is the amount of payment and the provider
does not request a second review within 90 days, the bill shall be
deemed satisfied and neither the employer nor the employee shall be
liable for any further payment.
(3) Within 14 days of a request for second review, the employer
shall respond with a final written determination on each of the items
or amounts in dispute. Payment of any balance not in dispute shall
be made within 21 days of receipt of the request for second review.
This time limit may be extended by mutual written agreement.
(4) If the provider contests the amount paid, after receipt of the
second review, the provider shall request an independent bill review
as provided for in Section 4603.6.
(f) Except as provided in paragraph (4) of subdivision (e), the
appeals board shall have jurisdiction over disputes arising out of
this subdivision pursuant to Section 5304.
SEC. 2. Section 4603.4 of the Labor Code is amended to read:
4603.4. (a) The administrative director shall adopt rules and
regulations to do all of the following:
(1) Ensure that all health care providers and facilities submit
medical bills for payment on standardized forms.
(2) Require acceptance by employers of electronic claims for
payment of medical services.
(3) Ensure confidentiality of medical information submitted on
electronic claims for payment of medical services.
(4) Require the timely submission of paper or electronic bills in
conformity with subparagraph (B) of paragraph (1) of subdivision (b)
of Section 4603.2.
(b) To the extent feasible, standards adopted pursuant to
subdivision (a) shall be consistent with existing standards under the
federal Health Insurance Portability and Accountability Act of 1996.
(c) Require all employers to accept electronic claims for payment
of medical services.
(d) Payment for medical treatment provided or prescribed by the
treating physician selected by the employee or designated by the
employer shall be made with an explanation of review by the employer
within 15 working days after electronic receipt of an itemized
electronic billing for services at or below the maximum fees provided
in the official medical fee schedule adopted pursuant to Section
5307.1. If the billing is contested, denied, or incomplete, payment
shall be made with an explanation of review of any uncontested
amounts within 15 working days after electronic receipt of the
billing, and payment of the balance shall be made in accordance with
Section 4603.2.
SEC. 3. Section 4625 of the Labor Code is amended to read:
4625. (a) Effective for services provided on or after January 1,
2017, all bills for medical-legal evaluation or medical-legal expense
shall be submitted to the employer within 12 months of the date of
service in the manner prescribed by the administrative director. The
administrative director shall adopt rules to define circumstances
that constitute good cause for an exception to the 12-month period.
Bills for medical-legal charges are barred unless timely submitted.
(b) Notwithstanding subdivision (d) of Section 4628, all charges
for medical-legal expenses for which the employer is liable that are
not in excess of those set forth in the official medical-legal fee
schedule adopted pursuant to Section 5307.6 shall be paid promptly
pursuant to Section 4622.
(c) If the employer contests the reasonableness of the charges it
has paid, the employer may file a petition with the appeals board to
obtain reimbursement of the charges from the physician that are
considered to be unreasonable.
