Fourth Quarter 2018
By: Sue Barranco & Benjamin Birtch
Question: Under what circumstances do you recommend a Utilization Review (UR) or an Independent Medical Examination (IME) in an otherwise compensable claim?
Short Answer: In Wisconsin, a Utilization Review is a permissible but perhaps not an ideal tool to employ to challenge reasonableness and necessity of treatment in Wisconsin. Because in Wisconsin the process to challenge the necessity of treatment in a compensable claim begins upon receipt of a completed bill, and a medically supported denial must be provided within 60 days, a UR may be a useful cost containment tool given the quick turnaround required—but challenges to admissibility of the report may occur if the claim becomes litigated. An Independent Medical Examination is recommended when a disreputable provider is involved; when there are questions of extent of overtreatment; when there are suspicions about whether a patient is malingering; and to challenge a clearly excessive permanent partial disability rating.
Wisconsin is different than other jurisdictions in which Hennessy & Roach P.C. practices in that Chapter 102 does not require or even encourage use of Utilization Review to challenge the reasonableness/necessity of treatment. The UR concept is not defined under Wisconsin worker’s compensation law. Utilization Reviews are referenced in the Wisconsin Administrative Code, but such URs do not relate to workers compensation, and instead involve Department of Health Services Hospital Management rules requiring a written “plan to ensure that quality patient care is provided in the most appropriate, cost-effective manner.” Wis. Adm. Code § DHS 124.11. Despite detailed procedures on challenging reasonableness of care in Wisconsin, the worker’s compensation statute and regulations are essentially silent on URs.
Further, there are no reported decisions explicitly approving of or rejecting worker’s compensation URs—but the concept is referenced in a potentially useful manner in a Commission-level decision from 1990. See Chamblee v. American Motors Corp., 87-051520, (LIRC, Nov. 6, 1990). The Chamblee case involved a claimed bad faith denial of liability for medical expenses in which the Respondent parties lacked a medical opinion to deny liability for medical expenses following an IME that had been adverse to their interests. Still, medical expenses associated with an otherwise compensable surgery were not paid, and the rationale for non-payment was not communicated until August 1989, despite the surgery’s occurrence in January 1989. In August 1989, the Respondent parties communicated that they had obtained professional assistance from one of the nation’s leading medical utilization review specialists, who opined after an extensive audit that the claimant’s treating physicians consistently exceeded criteria for reasonable medical treatment in worker’s compensation cases, including in association with treatment provided to Mr. Chamblee. The Commission found that, prior to August 1989 when that basis for nonpayment was communicated in a UR-like report, there has been no reasonable basis upon which to deny liability. While URs were only referenced offhandedly, and in a decision before URs became used more prevalently toward worker’s compensation cost containment strategies, this Commission-level decision suggests medical opinions of this nature can seemingly be deployed to potentially insulate insurers from bad faith penalties.
Despite the relative novelty of the UR concept under Wisconsin worker’s compensation law, it may be useful to undertake URs because treatment necessity disputes require a formal, medically supported rationale for any denial within a tight timeframe. In Wisconsin, the process to challenge the reasonableness/necessity of treatment is initiated on receipt of the bill, not prior to treatment occurring. Preauthorization of treatment is not required in Wisconsin. Thus, medically excessive care may occur without advance warning. Even so, the process to challenge the necessity of such treatment is short. Upon receipt of a completed medical bill, an insurer or self-insured employer is required to provide written notice of the reasonableness of treatment dispute to the health care provider within 60 days. Wis. Stat. 102.16(2) & DWD 80.73(3)(a). This notice must include the reason treatment was unnecessary and credentials of the organization or person supporting that conclusion. A provider later challenging this conclusion will, in its WKC-9380 form—a State-required filing initiating a “Necessity of Treatment Dispute Resolution Request”—have to certify an insurer provided a denial letter within 60 days of the completed bill that included information on why the treatment was unnecessary, and what medical expert so opined. If your case is compensable, you likely will not have an IME on hand to cite to deny liability for expenses within 60 days of receipt of the bill. The UR can allow you to explore and if possible explain why treatment is not necessary, providing the credentials of the provider supporting the dispute quickly and even retrospectively.
One issue with URs in Wisconsin may involve admissibility, and potentially the credibility of the conclusions once admitted into evidence. By statute, if a medical expert who is licensed in a different state provides an opinion as to the necessity of treatment, his or her report constitutes prima facie evidence on the contents therein only if the practitioner consents to being subjected to cross-examination. Wis. Stat. §102.13(1)(d)4. Otherwise, such evidence can be barred. Parties to litigated matters routinely work around this issue and typically in Wisconsin, where depositions are not permitted under normal circumstances, experts and treating physicians do not need to be present at a Hearing because the parties’ affix to opinions a completed WKC-16B form titled “Practitioner’s Report On Accident In Lieu Of Testimony.” This form allows the provider to confirm he or she is willing to be subject to cross-examination. Even then, a party can properly subpoena the provider to testify and the report can be barred if the provider refuses—but typically a report accompanied by a WKC-16-B form will be admitted into evidence without objection. This practice may create a kind of administrative complication with a UR report that lacks an accompanying WKC-16-B form if your claim is later in litigation. The UR provider could be licensed out of State. See Wis. Stat. § 102.13(1)(d)1 (“The testimony of any [medical expert] . . . licensed to practice where he or she resides or practices in any state . . . may be received in evidence”); see also, Wis. Stat. § 102.17(1)(d) (“Certified reports of [medical experts] wherever licensed and practicing” are admissible and competent if the expert consents to being subject to cross-examination). However, there may be questions as to the credibility of the conclusions of a non-Wisconsin expert, and the parties to litigation may play games with subpoenas to prevent reports of non-local doctors from coming into evidence.
For these reasons, a better approach may be a well-timed medical records review. In Wisconsin, without a definitive deadline, a medical records review can serve essentially the same function as could a UR. An independent physician provides his or her opinion on whether treatment was reasonable and necessary. Independent medical evaluation reports must be disclosed to the opposing side or claimant “immediately upon receipt,” while medical records reviews do not require disclosure unless the MRR is being cited to explain a denial of liability.
Independent Medical Exams
Next, there are a variety of reasons why an IME should be obtained on an otherwise compensable claim—the majority of which are not specific to issues in Wisconsin claims. The most obvious reasons are to challenge a clearly excessive permanent partial disability rating or to obtain an opinion that the claimant has reached end of healing. An IME can be useful to establish defenses against treatment rendered by a disreputable provider or a provider who is known to over-treat patients. When the claimant seems to be prolonging treatment, for whatever reason, an IME should be obtained. While the IME report will not always be favorable, as it may opine the claimant needs further treatment, these reports can help establish a reasonable treatment plan. An IME is also recommended when the claimant requests extension on restrictions even while being encouraged to return to work. Your expert can establish an accurate, objective depiction of where the claimant is in the healing process. Another instance where an IME is recommended on a compensable claim is when the claimant is skipping appointments.
Practice Tip: If a claimant is treating with a practitioner with a reputation to excessively treat, initiate the UR process, or in claims where, in other states, you may consider a UR, simply obtain a medical records review given potential evidentiary concerns if your claim lands in litigation.