Allied Signal Aerospace v. Workers' Comp. Appeals Bd. ( 2019 )

Filed 5/15/19; Certified for Publication 6/5/19 (order attached)
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION TWO
ALLIED SIGNAL AEROSPACE, B293080
CONSTITUTION STATE SERVICE
COMPANY, (Los Angeles County
Petitioners, Super. Ct. No. ADJ2798585)
v.
WORKERS’ COMPENSATION
APPEALS BOARD and MAXINE
WIGGS,
Respondents.
PROCEEDINGS to review a decision of the Workers’
Compensation Appeals Board. Annulled and remanded.
Kegel Tobin & Truce, and Anthony J. Macauley for
Petitioners.
Law Offices Berkowitz & Cohen, and Sheldon S. Cohen for
Respondent Maxine Wiggs.
Allison J. Fairchild for Respondent Workers’ Compensation
Appeals Board.
******
Petitioners, Allied Signal Aerospace (Allied or employer)
and Constitution State Service Company (collectively
petitioners), sought issuance of a writ of review from this court
following a decision by the Workers’ Compensation Appeals
Board (appeals board) concerning Maxine Wiggs (Wiggs or
employee) and her request for heavy housework assistance. The
writ of review was issued on December 3, 2018. The interested
parties have submitted their briefs and the matter was placed on
the court’s May 2019 calendar.1
An employer’s decision to deny or modify a physician’s
request for specific medical services for an injured employee is
subject to review under the “utilization review” process. Broadly
put, utilization review is handled by medical experts. Save for
two limited exceptions, neither a workers’ compensation judge
(WCJ) nor the appeals board has jurisdiction over the utilization
____________________________________________________________
1 On April 30, 2019, a request for dismissal of the petition for
writ of review was filed by petitioners. We hereby deny the
request for dismissal on the grounds that it is procedurally
flawed (the writ issued on Dec. 3, 2018) and no explanation was
provided in support of the request. Furthermore, once the court
issues an alternative writ or order to show cause, the court may
decide the case and issue a written decision even if the parties
negotiate a settlement before oral argument. (Glenfed Dev. Corp.
v. Superior Court (Nat. Union Fire Ins. Co.) (1997) 53
Cal. App. 4th 1113, 1116, fn. 1 [“a negotiated resolution of the
issue on the eve of oral argument does not mean we will refrain
from filing our opinion”].)
2
review process. In this case, a majority of the appeals board
concluded one of the two exceptions applied in that the parties
had stipulated that the issue of a home assessment for
housekeeping services would be decided by a specific registered
nurse. However, the evidence does not support this conclusion.
The agreement between the parties was that the nurse would
provide a home assessment for housekeeping services in one visit
in 2012. There was no agreement or stipulation that the nurse
would continue to be the arbiter of this issue in the future after
her one visit in 2012.
We granted the employer’s petition for review because the
appeals board acted in excess of its jurisdiction in addressing, on
the merits, the issue of home assessment for housekeeping
services.2 We therefore annul the decision of the appeals board
and remand the case with directions for further proceedings
consistent with this opinion.
STATUTORY FRAMEWORK
An employer is responsible for providing an injured
employee with any medical treatment or related care that is
reasonably required to cure or relieve the effects of the injury.
(§ 4600, subd. (a).) Home health care is medical treatment if it is
reasonably required to cure or relieve the injured employee from
the effects of the injury and prescribed by a physician. (§ 4600,
subd. (h).)
____________________________________________________________
2 “The review [of a petition for a writ of review] by the court
shall not be extended further than to determine, based upon the
entire record which shall be certified by the appeals board,
whether: [¶] (a) The appeals board acted without or in excess of
its powers.” (Lab. Code, § 5952, subd. (a).)
Further statutory references are to the Labor Code.
3
Utilization review (UR) is the statutorily defined process by
which an employer reviews and approves, modifies, delays or
denies a physician’s request for authorization (RFA). (§ 4610,
subds. (a), (b).) “Under the UR process, a request for treatment
cannot be denied by a claims adjustor and must be approved
unless a clinician determines that the treatment is medically
unnecessary.” (Stevens v. Workers’ Comp. Appeals Bd. (2015) 241
Cal. App. 4th 1074, 1081.) This ensures that a physician, rather
than a claims adjuster with no medical training, makes the
decision to deny, delay, or modify treatment. (State Comp. Ins.
Fund v. Workers’ Comp. Appeals Bd. (2008) 44 Cal. 4th 230, 241
(Sandhagen).)
Disputes over an employer’s UR decision are governed by
section 4610.5 et seq. which detail the independent medical
review (IMR) process.3 The specific provision which applies in
this case is subdivision (a)(2) of section 4610.5 which provides for
the IMR process when, as here, the UR decision was
communicated to the requesting physician after July 1, 2013.
The IMR process is the exclusive remedy for resolving UR
disputes. Section 4610.5 subdivision (b) states that “[a] dispute
described in subdivision (a) shall be resolved only in accordance
with this section.” Section 4610.5 subdivision (e) provides that
“[a] utilization review decision may be reviewed or appealed only
by independent medical review pursuant to this section.” The
two exceptions currently recognized by the appeals board to
circumvent the UR-IMR process are where the UR decision is
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3 “If a utilization review decision denies or modifies a
treatment recommendation based on medical necessity, the
employee may request an independent medical review as
provided by this section.” (§ 4610.5, subd. (d).)
4
untimely4 or when the parties have agreed to waive their right to
pursue the statutory review process.5 Under these two
circumstances, the appeals board retains jurisdiction to
determine whether the requested medical treatment is
reasonable and necessary based on the substantial medical
evidence.
The exception at issue in this case is whether the 2012
stipulation was an agreement to waive UR and use the agreed
registered nurse for all future disputes in addition to the 2012
dispute.
FACTUAL BACKGROUND
The employee, Wiggs, sustained admitted industrial
specific injury on April 21, 1997, and cumulative injury from May
3, 1997 through May 30, 1998, while working for Allied. As a
result of her industrial injuries, Wiggs had six surgeries from
1998 through 2012. By the time of her surgery in 2012, Wiggs
was on multiple opiod and narcotic medications for pain
____________________________________________________________
4 The appeals board in the en banc decision of Dubon v.
World Restoration, Inc. (2014) 79 Cal.Comp.Cases 1298 (Dubon
II) held that the appeals board’s jurisdiction over disputes arising
from a UR decision was limited to those involving an untimely
decision. (Id. at p. 1299.) Dubon II found that an untimely UR
decision is invalid and not subject to IMR. (Id. at p. 1307.) If a
UR decision is untimely, the determination of medical necessity
may be made by the appeals board based on substantial medical
evidence. (Id. at p. 1300.)
5 The appeals board apparently inferred the exception from
Sandhagen, supra, 44 Cal.4th at page 240, which stated that
medical review is not required if the employer approves the
treatment request. (See Bertrand v. County of Orange (2014)
2014 Cal. Wrk. Comp. P.D. LEXIS 342, 6.)
5
management. Wiggs had three more surgeries from 2014
through 2017.
A dispute arose over home health care services. On
October 22, 2012, the parties stipulated as follows:
1. Irene Mefford, RN-BC, CCM, CNLCP (Mefford) was the
agreed registered nurse to perform a home assessment for
housekeeping services;
2. Mefford was to prepare a report, which should be sent to
Wiggs’ doctors for review and comment;
3. Jurisdiction was reserved over Wiggs’s retroactive claim for
housekeeping services.
Mefford’s report, issued on February 11, 2013, recommended
Wiggs be provided with housekeeping services two times a month
(approximately four hours per visit) for the purposes of
housecleaning duties for the duration of one year. Mefford also
stated that the “opinions expressed in this report may need
revision should additional information become available.”
Allied authorized home care for one year and also paid for
retroactive home care in the amount of $5,507.
On March 7, 2014, Wiggs’s primary treating physician
submitted an RFA for home care. Allied’s UR authorized home
care on March 14, 2014. The authorization was for four hours
twice a month for deep cleaning assistance.
As a result of Wiggs’s additional surgeries, on June 18,
2015, Wigg’s physician requested authorization for four hours of
house cleaning every week. Allied’s UR denied authorization for
increased house cleaning home care. Wiggs did not seek an IMR
of the UR denial.
The record includes multiple RFAs included within
progress reports of Wiggs’s doctors for four hours of house
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cleaning per week. The most recent RFA for four hours of home
health care per week was submitted on April 6, 2016. Wiggs
thereafter filed for an expedited hearing on the issue.
PROCEDURAL BACKGROUND
The parties’ positions
In her trial brief, Wiggs argued that Allied’s failure to
submit the April 6, 2016 RFA for home health care to the UR
process had the effect of entitling her to home care. Allied argued
that the April 6, 2016 RFA was identical to an earlier denied
RFA, which could not be asserted without any change in
circumstance in Wiggs’s condition. Neither Wiggs nor Allied at
this point raised an ongoing stipulation to utilize Mefford for any
disputes arising out of home health care.
The first time Wiggs raised the 2012 stipulation was in a
June 1, 2017 letter to the WCJ requesting an order that the
parties return to Nurse Mefford and she review all relevant and
material medical evidence to determine Wiggs’s need for
continued home health care. Allied responded on June 8, 2017,
that Mefford was retained for a one-time evaluation, which
resulted in one year of home health care provided by Allied.
The WCJ’s decision to develop the record
The WCJ ordered Allied to serve Mefford with Wiggs’s
medical reports from March 10, 2012 through October 19, 2016.
The WCJ ordered Mefford to prepare a supplemental report after
review of the medical records, a home assessment, and interview
with Wiggs. The report was to address whether as a result of her
industrial injuries, Wiggs was in need of heavy home health care.
(Ibid.)
Allied petitioned for reconsideration and removal. As to
reconsideration, Allied asserted the WCJ did not have
7
jurisdiction over the issue of home care. Allied claimed the
WCJ’s order to develop the record circumvented the UR and IMR
process. In addition, Allied claimed that the October 22, 2012
stipulation did not obligate Allied to pay for Mefford’s services on
the home care issue.
The WCJ recommended reconsideration and removal be
denied.
The appeals board’s opinions
A majority of the appeals board affirmed the WCJ’s
decision to develop the record and incorporated and adopted the
WCJ’s opinion and report.
The majority construed the October 22, 2012 stipulation to
use Mefford for a determination of home care needs to be “a
procedure for evaluating applicant’s need for homecare . . . .”
The dissent found the medical treatment issue should be
addressed through the UR and IMR processes. The dissent
agreed with Allied that the stipulation of October 22, 2012, was
for a one-time evaluation by Mefford following her spinal surgery
in 2012 and not an ongoing agreement. This was evidenced by
the RFA submitted to UR after expiration of the one year
recommended by Mefford.
DISCUSSION
I. Writs of review and finality
It is settled that writs of review issue only to review final
decisions, orders or award of the appeals board. (§§ 5900, 5901,
5950; Capital Builders Hardware, Inc. v. Workers’ Comp. Appeals
Bd. (Gaona) (2016) 5 Cal.App.5th 658, 662; 2 Hanna, Cal. Law of
Employee Injuries and Workers’ Compensation (rev. 2d ed.)
§ 34.10[2], p. 34-9.) The usual definition of finality is whether
8
there are any issues left for judicial determination. (Lyon v. Goss
(1942) 19 Cal. 2d 659, 670.)
There is authority that permits review of so-called
“threshold” issues, such as whether the injury arose in the course
and scope of employment or whether the claim is barred by the
statute of limitations, even if there is no final decision of the
appeals board in the accepted sense of a final decision or award.
(Safeway Stores, Inc. v. Workers’ Comp. Appeals Bd. (1980) 104
Cal. App. 3d 528, 533.) The underlying rationale for allowing the
review of a threshold issue in the absence of a final decision is
that workers’ compensation proceedings should proceed
expeditiously and inexpensively. (Ibid.) Thus, if the resolution of
an issue will terminate the proceedings, it will save both time
and money if the issue is resolved, which conforms with the
purposes of the workers’ compensation system. (Id. at pp. 533-
534.)
The appeals board recognizes both the general rule
requiring finality and the threshold issue exception to that rule.
However, the appeals board contends that in this case the WCJ’s
order to develop the record, entered on August 17, 2017, did not
address a threshold issue. Specifically, the appeals board points
to the fact that the “Joint Findings & Orders” issued on that date,
referred to as the “F&O,” a shorthand we also adopt, was simply
an order to develop the record regarding a medical treatment
dispute. The appeals board contends that a “decision to enforce a
stipulation to resolve a discrete treatment dispute, while
obviously ‘significant and important’ to petitioner, is not an issue
of jurisdiction.” (Fn. omitted.)
We disagree with the appeals board’s interpretation of the
F&O.
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The F&O directed Allied to serve Mefford with Wiggs’s
medical reports from March 10, 2012 through October 19, 2016.
The F&O went on to direct Mefford to prepare a supplemental
report after review of the medical records, a home assessment,
and interview with Wiggs. The report was to address whether as
a result of her industrial injuries, Wiggs was in need of heavy
home health care. In short, the F&O assumed that the issue of
home health care would be resolved not in the UR process but
rather before the WCJ and, if necessary, the appeals board.
It is disingenuous to characterize such an order as a mere
interlocutory order that addressed a dispute over treatment.
Contrary to the appeals board claim, the F&O cut right to the
heart of a jurisdictional issue. Who has jurisdiction over the
issue of home health care for Wiggs? Is it the UR process or the
WCJ and the appeals board?
We conclude that the issue of home health care for Wiggs is
an issue to be resolved in and by the UR process, not the WCJ or
the appeals board. For the reasons we set forth fully below, the
WCJ and appeals board do not have jurisdiction to address and
resolve the issue of home health care for Wiggs.
Since this necessarily terminates the collateral proceedings
pending before the appeals board, the issue whether the appeals
board has jurisdiction over home health care for Wiggs qualifies
as a threshold issue. Accordingly, we address the appeal on the
merits.
II. Standard of review
Review by this court of an appeals board decision is limited
to a decision that is in excess of the appeals board’s jurisdiction,
that is procured by fraud or is unreasonable, or is not supported
by substantial evidence. (§ 5952.) An unreasonable decision
10
under section 5952 is one that is not supported by substantial
evidence or the use of unreasonable or arbitrary procedures. (2
Hanna, supra, § 34.18[1], p. 34-32.) When determining whether
the appeals board’s conclusion was supported by substantial
evidence, the evidence should be considered in light of the entire
record. (§ 5952, subd. (d); Le Vesque v. Workers’ Comp. Appeals
Bd. (1970) 1 Cal. 3d 627, 637.)
III. Substantial evidence does not support an ongoing
stipulation
The finding that is critical to the majority’s conclusion is
that “the parties stipulated to a procedure for evaluating
applicant’s need for homecare by having Nurse Mefford report on
the issue and there is no evidence of a change in applicant’s
condition or circumstances that eliminates that need.” This
finding provides the basis for the majority’s conclusion that this
case is like others in which the parties effectively entered into a
settlement agreement which provided for the submission of any
disputes to an arbitrator. In these cases, the settlement
agreement providing for submission of the disputes to an
arbitrator displaced the UR process.
The pertinent part of the stipulation regarding nurse
Mefford states: “Irene Mefford is the agreed R.N. to perform a
home assessment for housekeeping services.” In addition to the
fact that the stipulation calls for no more than a single home care
assessment, the stipulation simply does not reflect any
agreement by the parties to submit any future disputes to
Mefford for resolution. The stipulation was for an assessment by
Mefford to be performed on one occasion and nothing more than
that was agreed to or contemplated. That Mefford unilaterally
added to her report that her conclusion was subject to revision
11
does not translate into an agreement by the parties that she was
to resolve future disputes about home care.
It is significant that the parties’ conduct after 2012
confirms that the stipulation regarding Mefford was not seen as a
continuing agreement providing for Mefford’s services. There is
nothing in the stipulation that provides that Mefford was to
arbitrate disputes about home care. Wiggs’s treating physician
submitted an RFA for home care on March 8, 2014, and Allied’s
UR authorized the requested care. In 2015, Allied’s UR resulted
in the denial of an intensification of home care but the IMR
review process was not invoked.
Resort to the UR process in 2014 and 2015 makes it clear
that the parties did not understand the 2012 stipulation to be
anything more than an agreement to use Mefford to perform a
single assessment in 2012 of home care needs.
The dissent’s view that the majority misconstrued the
purpose and effect of the stipulation appears to be correct.
The appeals board’s reliance on Patterson v. The Oaks
Farm (2014) 79 Cal.Comp.Cases 910, 917-919 (Patterson) is
misplaced. The Patterson case held that when an employer
acknowledged the reasonableness and necessity of medical
services, the employer cannot unilaterally terminate those
services, even if there is no renewed prescription. (Ibid.)
Contrary to the appeals board’s finding that the employer in this
case unilaterally ceased to provide previously agreed reasonable
medical services, in 2014 Allied, through the UR process,
authorized the requested home care and only denied the request
for an intensification of home care in 2015. The latter decision
was not challenged through the IMR process.
12
The case of Bertrand v. County of Orange, supra, 2014 Cal.
Wrk. Comp. P.D. LEXIS 342 is distinguishable. Bertrand
involved an express stipulation to use an agreed medical
evaluator for future disputes. Here, the stipulation was to use
Nurse Mefford for a home assessment resulting in one year of
home health care, which was provided by Allied. The 2012
stipulation was clearly executed and completed. Nothing in the
2012 stipulation indicates an ongoing agreement to use Nurse
Mefford.
We find therefore that the appeals board’s conclusion was
not supported by substantial evidence. We hold that the 2012
stipulation was intended, as plainly stated, to be a one-time home
assessment and report by Mefford. The Legislature has expressly
stated that it is its intent to have “medical professionals
ultimately determine the necessity of requested treatment” and
that it “furthers the social policy of this state in reference to
using evidence-based medicine to provide injured workers with
the highest quality of medical care and that the provision of the
act establishing independent medical review are necessary to
implement that policy.” (Sen. Bill No. 863 (2011-2012 Reg. Sess.)
§ 1(e).) Since there was no stipulation to displace the provision of
home health care from the UR-IMR process, the appeals board
had no jurisdiction to review the medical necessity and
reasonableness of home health care.
13
DISPOSITION
The decision of the Workers’ Compensation Appeals Board
entered on August 21, 2018, is annulled and the matter is
remanded to the Workers’ Compensation Appeals Board.
______________________, J.
CHAVEZ
We concur:
_________________________, Acting P.J.
ASHMANN-GERST
_________________________, J.
HOFFSTADT
14
Filed 6/5/19
CERTIFIED FOR PUBLICATION
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION TWO
ALLIED SIGNAL AEROSPACE et B293080
al.,
(Los Angeles County
Petitioners, Super. Ct. Nos. ADJ2723676,
ADJ2798585)
v.
ORDER FOR PUBLICATION
WORKERS’ COMPENSATION
APPEALS BOARD and MAXINE
WIGGS,
Respondents.
THE COURT:*
The opinion in the above entitled matter filed on May 15,
2019, was not certified for publication.
For good cause it now appears that the opinion should be
published in the Official Reports and it is so ordered.
_____
*ASHMANN-GERST, Acting P. J., CHAVEZ, J., HOFFSTADT, J.
1