HB PERFORMANCE BASED OVERSIGHT

F O L I O C L I E N T N E W S L E T T E R B Y F L A H I V E , O G D E N & L A T S O N �

HB PERFORMANCE BASED OVERSIGHT At the Workers’ Compensation Working Group

meeting at TDI on April 29, 2006, TDI introduced an outline of a Performance Based Oversight (PBO) system. TDI was directed to develop this program by HB 7.

TDI hopes to complete initial assessments of the performance of carriers according to different measures, and will publicly recognize “high performers” on its TDI website. If they meet their expected timeframe, carriers will be evaluated based upon the carrier’s performance for dates of claims handling prior to September 30, 2006, and those evaluations will certainly be based upon the carrier’s current processes and decisions.

TDI will identify three different tiers of performance as mandated by statute. Carriers will be grouped as “poor performers, generally average performers, and consistently high performers.” Assessments of performance will be conducted at least once every two years through an analysis of data. The key regulatory goals to be measured are:

1. Timeliness of income benefits;

2. Timeliness of medical bill processing;

3. Minimizing disputes;

4. Return to Work outcomes; and

5. Workplace safety.

They may structure the performance measures according to these regulatory goals, or upon other metrics to be decided by TDI after participation by stakeholders in various work groups addressing these issues.

TDI will almost certainly use the EDI data reported for benefit payments, ECS-837 data (at the time that they are finally able to achieve a functional platform for carriers to report this data), revision data, and data calls. It was recommended that TDI use the data currently available and not request additional data from carriers. Obviously, producing the data could be a heavy burden.

TDI has not decided upon the boundaries between the three tiers. They almost certainly will identify a percentage of high performers (for instance top 25%) and poor performers (for instance bottom 25% performers) and the balance will be deemed to be “generally average.” Although they have not yet agreed on the principle, carriers should be compared relative to other carrier’s performance. The specific metric and whether the tiers will be based upon comparative ratings or ratings determined by independent system performance goals will be decided later. TDI will continue to emphasize accurate data. This has been a troublesome part of TDI audits in the past and it would appear that they will continue to emphasize data quality in the future.

In connection with another issue, TDI did point out that the Commissioner of Insurance has very broad authority to structure various remedies or non-monetary penalties as a disincentive for below standard performance to include carrier required self audits of a specific issue, data calls, increased audit oversight, etc.

In This Issue…

Network Case Managers .......................p. 4

TDI Adopts Network Endorsement........ p.19

Continued on p. 11

©2006 – Flahive, Ogden & Latson M AY 2 0 0 6 n V O L U M E � � , N O . 5

A P R I V I L E G E D AT T O R N E Y - C L I E N T C O M M U N I C AT I O N B Y F L A H I V E , O G D E N & L AT S O N

F O L I O C L I E N T N E W S L E T T E R B Y F L A H I V E , O G D E N & L A T S O N2

Flahive, Ogden & Latson, a 26 lawyer firm, defends contested workers’ compensation cases statewide every day. The firm has represented insurance companies and employers before the Texas Workers’

Compensation agency for more than 50 years. For general questions concerning the

newsletter call: (512) 435-2234.

Flahive, Ogden & LatsonP.O. Box 13367

Austin Texas 78711

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FO&L OFFICE HOURSDon’t wait until the last hour of the day for deadline filing. Any faxes with information due must be received by 3:30 p.m. for any deadline handling for same day delivery to the Commission, and faxed according to the fax directory listed on the last page of FOLIO. Furthermore, if you have a last

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is necessary to meet a deadline. We will be watching and waiting for the fax. Otherwise,

last minute faxes could delay receipt. Our last daily run to the Commission will be

at 4:00 p.m., in order to get across town to meet their 5:00 closing time.

INFORMAL NETwORkS (“RENTED” PPOS)

The question is whether a workers’ compensation carrier may discount provider fees for service because of a discount obtained through a contracted relationship with a non-certified PPO network. This issue has been controversial since the passage of HB7. It has been a subject of concern for all levels of government, especially TDI. TDI released Bulletin B-0005-06 which was discussed in the last two issues of Folio. Carriers using third parties as authorized agents to contract with networks should (1) have a contract between the carrier and the third party authorizing the third party to contract with healthcare providers; and (2) should have a contract or contract amendment between the third party as an authorized agent for the carrier and the provider naming the carrier and clearly stating the fee arrangement as between the healthcare provider and the third party as authorized agent on the carrier’s behalf. If carriers and informal networks comply with these requirements, an informal (also described at various times as a shadow, rented or silent) network is permitted.

Because this bulletin has generated a lot of questions, TDI placed the issue on the April 19, 2006 Agenda for the Workers’ Compensation Working Group. However, because of prior items on the agenda, this was only identified as an issue to be later discussed beginning at the May 1, 2006 meeting of the WCWG. In the short time remaining for the group meeting, there were a number of very pointed comments about this issue. Clearly, physicians and the one network member of the working group are stridently opposed to informal networks.

On May 1, 2006, TDI will invite a panel of informal network providers as well as others, to describe the process in which they are engaged. Provider and network-based stakeholders requested that a physician organization contracting with networks also be invited to present the physicians perspective.

This is a very large issue in Texas, and we thought it was resolved by the prior Commissioner Bulletin. There is some concern that this additional level of review indicates a gathering storm of providers who will attempt to reverse the present TDI position and bar the use of informal networks.


APPEAL OF COURSE AND SCOPE: 40 DAyS

State Office of Risk Management (SORM) v. Herrera, --- S.W.3d ----, 2006 WL 931721 (Tex.App.—Amarillo, 2006) is an important appellate case which held that issue of whether the worker was acting within scope of employment at time he was killed raised question of compensability, rather than question of coverage, and that therefore SORM had 40-days to file its appeal in District Court.

The dispute arose from the death of Jose Herrera, an officer with the Friona, Texas Police Department. At the time, he was responding to a call for assistance from the Parmer County Sheriff’s office. Herrera heard the call while completing paper work at the Friona police station after his shift ended, and in responding, his vehicle collided with that of the fleeing suspect outside the Friona city limits. SORM acknowledged that Herrera’s legal beneficiaries were entitled to receive worker’s compensation death benefits, but disputed its responsibility for their payment because they alleged that the officer was not acting within the course and scope of his employment with the State when he and the suspect collided, but rather within the scope of his employment with the City of Friona. The hearing officer found that Herrera was acting in the service of the State, a determination affirmed by the Appeals Panel. SORM then petitioned the trial court for relief, after 30-days had passed. This was too late, according to Herrera’s family members, the City of Friona, and TML-IRP. They believed that the agency was required to petition within 30-days and therefore they filed a plea to the jurisdiction of the trial court. The trial court sided with Herrera, the City and the Risk Pool and dismissed the case, and SORM then appealed to the Amarillo Court of Appeals.

The Court of Appeals noted that the issue before them was whether SORM had merely 30 days to seek redress from the trial court. They opined that the answer to that depended upon whether the allegations encompassed matters of compensability or coverage because if it were a coverage issue then the 30-day period applied per §§ 410.301 and 410.255 of the Texas Labor Code (the Act), but if it were a compensability issue, then SORM had 40 days to file per § 410.252 of the Act. Since §§ 410.301 and 410.255 of the Act deal with those disputes “regarding compensability or eligibility for or the amount of income or death benefits….” the court held that

a party has 40 days to perfect judicial review of controversies implicating compensability and eligibility for or the amount of income or benefits, and that in all other cases, a litigant had only 30 days.

The Appeals Court the noted that the Act failed to define the term “compensability, but had at least defined “compensable injury” as one that “that arises out of and in the course and scope of employment for which compensation is payable….” The court concluded from this that the meaning of “compensable” and “compensability” required at least that the injury to occur within the course and scope of the claimant’s employment. Based on this reasoning, the Appeals Court held that the issue before it had to be one of compensability, given that the crux of the dispute of the case at bar required identification of the employer being served at the time of death. Therefore, the time period set forth in § 401.252(a) applied here and SORM had 40 days within which to petition for judicial review. Having acted within that period, the trial court had jurisdiction over the controversy and had erred in dismissing it.

LIEN LETTER OBLIGATES CARRIER PAyMENT

In Hays & Martin v. Urbinas-Brache, No. 05-05-00238-CV, 04/04/2006, Israel Garcia was severely burned while removing glue from the floor in the course of his employment at Sears and Roebuck. A carrier provided Garcia’s workers’ compensation benefits. Garcia was operated on twice by Emmanuel Urbinas-Brache, a plastic surgeon.

Before the surgery, Urbinas-Brache’s staff contacted the carrir requesting a letter of protection for Garcia’s medical bills at settlement. The carrier promised protection and requested an itemized bill of services. The carrier preauthorized the second surgery, but failed to pay because Urbinas-Brache did not submit an operative report with the claim. Subsequently, “Garcia settled his lawsuit with Sears and received a $1,150,000 settlement. As part of the settlement agreement, Garcia agreed to pay any remaining unpaid medical bills.” When Urbinas-Brache resubmitted his claim, TWCIF cited the settlement agreement in refusing to pay the costs of surgery.

Urbinas-Brache sued TWCIF, “claiming it was obligated to pay him pursuant to the letter of

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protection he had requested from appellant.” At the trial court level, the jury awarded Urbinas-Brache $50,000 and attorney’s fees. The trial court reduced the judgment to $17,446.50 in damages plus attorney’s fees. TWCIF appealed, arguing that the trial court lacked jurisdiction, the letter of protection was not an enforceable contract because there is no evidence of offer and acceptance or mutual assent, and that the attorney’s fees award was not supported by the evidence.

The Court of Appeals affirmed. The court held that the trial court did indeed have jurisdiction over the claim. Because the issue presented is not an issue covered by the Workers’ Compensation Act, the Division of Workers’ Compensation (formerly the Texas Workers’ Compensation Commission) did not have jurisdiction over the dispute:

“The Act does not provide for dispute resolution when, as here, payment is denied not on the basis of medical necessity or the reasonableness of the fee, but rather because the injured worker entered into a settlement agreement specifically providing he is responsible for any unpaid medical bills. ... Because the Act does not provide clear and express authority to

CERTIFICATION OF NETwORk

CASE MANAGERS

Networks must utilize a Medical Case Management Program with certified case managers. The statute identifies the National Commission for Certifying Agencies (NCCA), the American Board of Nursing Specialties, or another national accrediting agency as permitted certifying organizations.

TDI has released a list of certifications and sponsoring organizations. The organizations recognized by NCCA and TDI are listed as Case Manager Certification, Commission on Rehabilitation Counselor Certification, Certification of Disability Management Specialists Commission and American Nurses Credentialing Center.

Agencies that have not yet achieved NCCA accreditation are: National Board for Certification and Continuity of Care, Center for Case Management, Association of Rehabilitation Nurses, and American Board for Occupational Health Nursing.

At the time that certification by an organization becomes mandatory, if the NCCA has not accredited the currently non-accredited associations, certifications by those agencies will not meet the TDI network requirements for “Certified Case Management.” Accordingly, carriers contracting with the networks to provide in house case management, and networks as well, should ensure that the prospective case managers to be providing services after January 1, 2007 will be certified by one of the NCCA and TDI approved organizations.

MEDICARE CONVERSION RETRO CALCULATION

Because Medicare changed its conversion factor, and because that factor is utilized by DWC in the Medical Fee Guideline, most payments in January 2006 are incorrect if the amendment to the Medical Fee Guideline applies retroactively in workers’ compensation.

DWC has no authority to retrospectively establish a different rate. The Medicare Fee Guideline in effect on the date of the service was the old guideline. Although it was retroactively changed, a change was not effective on the date that the service was rendered.

DWC has recognized that there is no clear obligation on the part of carriers to reimburse providers at the increased rate and in Bulletin B-0006-06, DWC “requested” carriers to pay the healthcare provider the differences between the previous MAR and the new calculated MAR from services provided on or after January 1, 2006 up to March 6, 2006 when DWC issued the Commissioner’s Bulletin. The Bulletin conspicuously does not order these payments.

The Insurance Council of Texas has released a legal opinion from its general counsel questioning the DWC’s authority to retroactively legislate rates. Because the difference in the two rates are negligible, and in many cases will amount to only pennies, the real challenge and cost potential has to do with the cost of reprocessing all the bills, issuing new EOBs, and issuing payment.

It is highly unlikely that DWC will fine for the nonpayment of these additional amounts unless they first issue a bulletin specifically mandating these payments. There is a great deal of pressure from medical providers for DWC to issue a release stating that these additional payments are mandatory.

Lien letter obligates carrier payment – continued from p. 3

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resolve the dispute at issue in this case, appellant has failed to show the trial court did not have, as a court of general jurisdiction, subject matter jurisdiction over this case.”

Furthermore, the trial court did not lack jurisdiction because this was a breach of contract action, and not an action to recover unpaid medical bills from a workers’ compensation claimant, as TWCIF proposed:

“However, [Urbinas-Brache]’s claim in this case was for breach of contract pursuant to the letter of protection. Appellee is not seeking to recover unpaid medical bills from Garcia. Rather, appellee contended appellant was liable for [Urbinas-Brache]’s failure to be paid because after promising to protect [Urbinas-Brache]’s medical bills in the event of a settlement, he failed to do so. As such, it is not a claim for medical benefits under the Act. Nor does his claim somehow circumvent the Act’s administrative process. [Urbinas-Brache]’s claim was for damages from a third party not subject to monitoring under chapter 413 pursuant to a contract not governed by the Act.”

The court then determined that the letter of protection was an enforceable contract. As the letter was solicited and returned, there is no doubt that there was an offer and acceptance. Additionally, the court held that there was a meeting of the minds to satisfy the formation of a contract, thereby rejecting TWCIF’s argument that Urbinas-Brache had no intent to protect the medical bills if a settlement occurred:

“That appellee sought medical payment from the insurer prior to any settlement agreement does not in anyway establish appellee did not intend that, should a settlement be reached, he would not expect appellant to protect the medical bills as promised in the letter of protection. In fact, the evidence shows that as soon as appellee became aware of the settlement agreement, he contacted appellant regarding payment. Thus, we conclude that appellant’s argument that there is no evidence of mutual assent lacks merit.”

Finally, the court affirmed the award of attorney’s fees despite the fact that no evidence of time records or specific number of hours the attorneys or paralegals worked on the case was presented:

“After considering the difficulty and length of time spent on the case, [Urbinas-Brache]’s attorney considered $30,000 a reasonable and necessary fee. Thus, although the record does not specify the total number of hours spent on the case by each person who had devoted time to it, the jury had evidence upon which to determine the reasonableness and necessity of the attorney’s fees.”

NETwORk QUALITy IMPROVEMENT PROGRAMS

HB 7 requires a network to develop and maintain an ongoing Quality Improvement Program. Although the network governing body is ultimately responsible for the program, TDI has clarified that the management of the program may be delegated to an outside entity.

A Quality Improvement Program must include a committee composed in part of network providers, must meet at least annually, and must review an annual written report on the Quality Improvement Program.

The program must be continuous and comprehensive addressing the quality of clinical care and the quality of services. The network must dedicate adequate resources including personnel and informational systems to implement the program.

As a part of the program, the network must develop a work plan designed to reflect the types of services and the population served by the network in terms of age groups, injury categories, and special risk status, such as the type of the industry. It must incorporate objective and measurable goals, planned activities to accomplish the goals, timeframes for implementation, individuals responsible, and evaluation methodology.

Networks must adopt and periodically update treatment guidelines, return to work guidelines, individual treatment protocols, and the list of services requiring preauthorization. Importantly, a network may delegate its quality improvement program to a vendor; however, the network and the carrier retain ultimate responsibility for insuring that the Network Quality Improvement Program is sufficient to meet the statutory and rule requirements.

Any change in the configuration of a network affecting the delivery of care must be reported by the network to TDI so that they may evaluate the continued adequacy of care. Accordingly, if a number of providers leave the network, and if that impacts the potential quality of care in any region, TDI may require remedial measures for the network to continue to be approved. Some of the measures may include recruiting new providers, determining the reasons providers left the network, alternative access plans, reduced service area, coverage, etc. TDI will not provide a threshold number at which this duty is triggered. It will simply have to be evaluated by the network. The large point is that any substantial change in the network must be reported to TDI.


GQ COrner

Q: Does the approval of preauthorization or concurrent review guarantee payment?

A: In a word, “No.” Approval of a preauthorization or concurrent review request establishes only the medical necessity of

the services approved. Although you are absolutely prohibited from reviewing the bill again for medical necessity issues, the billing for the services could still be denied or reduced upon retrospective review on the following grounds: the charges are reduced per the relevant fee guideline; the injury in non-compensable, the carrier is not liable for the injury and/or the body part or condition the basis for the services is not related to the compensable injury; the treatment actually provided does not correspond to the requested and approved health care.

Q: Is there a Division rule that requires us to send medical records to a claimant’s attorney prior to the scheduled Benefit Review

Conference?

A: Rule 141.4(b) indicates that parties must exchange all pertinent information prior to the Benefit Review Conference. This rule was

not enforced in the past, but lately, the Division has started issuing administrative violations for parties failing to adhere to the rule. Medical records clearly constitute “pertinent information.”

Q: Is there a time frame that a peer review is good to use for disputing a medical bill by Division rule?

A: The Division rules do not provide a specific time frame for relying on peer reviews in the context of disputing medical bills. The

peer review is as good as the underlying assumptions remain good. If the facts suggest a rather quiet claim medically, you may be able to get further mileage out of the peer. If the claimant is quite active medically and the claimant’s medical status appears to have changed with time, it is appropriate to get an updated peer review more frequently.

Q: Claimant states that a co-worker threw a paint can at him, injuring his leg. The person he states threw the can is claiming he did

not. There were also witness names given but the witnesses state they saw nothing. We are getting written statements from all witnesses. The claimant advised us that he is under too much stress to give us the statement at this time. When we tried to call him again, we were advised he was at the hospital as his leg was really bothering him. This claim has red flags all over it. Is there any way we can deny due to the claimant refusing to give us a recorded statement?

A: If the preponderance of the credible evidence from your investigation fails to support the existence of an incident or an injury, then

you may deny. It is the claimant who has the burden to prove a compensable injury; it is not the carrier’s burden to disprove it. Once you have taken the statement of the alleged assailant, you are the only one who is then in the position to make a credibility judgment. Further, depending upon the facts of the case, you may have a defense under 406.032 for an intentional injury caused by another for non-work related reasons; however, if the assailant denies the incident occurring, it may be difficult to establish the underlying motivation.

Q: The claimant is in sales. She travels and works out of her home. She has reported that she had just left a business lunch and, prior to

going to her next business appointment, she needed to go home because she was having a crate delivered with a chandelier in it. The employee has recently moved and was still having furniture delivered. On the way home, she is in a motor vehicle accident and injured. I advised the claimant that I was of the position that she had deviated and was on a personal mission, and at the time of the incident, was no longer furthering the interest of the employer. Do we have a legitimate cause to deny the claim?

A: Yes. This is a case you should dispute, unless the delivery was for work. The travel was personal in nature as she was traveling from

her place of employment to her home; she would not have traveled to that location in the absence of a personal mission. This should fall within the normal coming and going rule for travel.


Q: The claimant is employed as a customer service representative and takes calls. The claimant indicated he was participating in a

company-sponsored sumo wrestling activity during regular business hours when he injured himself. He was wrestling with a co-worker at the time and injured his right knee. He was taken to the hospital via ambulance. He was referred to his family doctor and/or an orthopedic. There was a possible tear. He is off work. He has no health insurance. I questioned the claimant in a statement as to why he was sumo wrestling on the job. He indicated they just did it, but it was voluntary. According to the employer, they were having an attendance promotion, which was voluntary. They gave the claimant a waiver form, but gave him the wrong form. They gave him to the waiver form for arm wrestling instead of sumo wrestling. He was not furthering the business of his employer; therefore, I would like to file a dispute and need the appropriate wording.

A: Pre injury waivers are essentially useless for disclaiming liability; they are only useful as some evidence of the voluntary

nature of the activity. However, you should still dispute as the claimant was injured during voluntary participation in an off-duty social, recreational, or athletic activity, which is excluded from coverage under Labor Code Section 403.032(1)(d). Further, claimant’s sumo wrestling activities did not further the interest of his employer and accordingly any resulting injuries were outside the course and scope of his employment.

Q: Can we forward the designated doctor report to insured? If not, please forward references.

A: We recommend against a release of any medical report to the employer. Although the statute and rules clearly contemplate

that the employer in the workers’ compensation setting be apprised as to the medical status of the employee (and some rules mandate the provision of the report to the employer), no statute or rule specifically provides the mechanism for the employer to receive the reports from the carrier. You could certainly defend the action retrospectively, but why would you want to expend the time and resources to do so unless the employer is prepared to indemnity you. The claimant could assert a number of statutory

privacy and liability concerns. HIPAA, The Texas Medical Privacy Act (Texas Insurance Code, chapter 28B) and Insurance Code Section 36.159(c) all create potential liability for wrongful disclosures of medical documents. Of course, HIPAA does not apply in the workers’ compensation context sharing of information with an employer is permissible in the course of a claim review (Art. 28B.04(7,10,12,19, and 25) TEX. INS. CODE). There is also the potential of common law liability under an invasion of privacy theory.

In the absence of a HIPAA compliant release from the employee allowing the release of records, there are ways to handle this diplomatically with the insured that makes a special request for medical documents. Stress the potential liability concerns if there is an improper disclosure of medical records. If the medical documents are filed with the DWC, you can provide the employer with a DWC-152 request form; they can request those specific medical documents or the entire claim file from DWC. You are protected from liability by the DWC insulation.

Q: We are paying the claimant temporary income benefits based on the wage information on the TWCC-1. A wage

statement was received but only covered a 9-week period rather than a 13-week period prior to the injury. This is probably because the claimant was not a 13-week employee and the employer will not submit a wage statement on a similar employee. It may be difficult to locate one. Would it be your recommendation we use the wage statement as is and calculate the wages by dividing by 9?

A: It is the claimant’s burden to establish the AWW. You are specifically authorized to rely upon information you have been provided,

even when the information is not complete. As long as the wage statement reasonably reflects an average weekly wage that the claimant would have made over 13 weeks, then use the wage statement and divide by 9. This is a fair and just calculation; the claimant would have to show why this does not reasonably reflect expected wages by presenting alternative evidence, which you would then be required to consider. That the claimant expected to get more or received fewer hours, for example, than he was promised is not relevant.

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Q: What action should be taken when a designated doctor gives a rating on a claim that is disputed? On this occasion, the designated

doctor exam occurred within the 60 days of claim, while claimant is receiving temporary income benefits, and just days before adjuster filed her entire denial of the claimant, and terminated income benefits.

A: The adjuster should dispute the rating only if you disagree with the calculation. Do not dispute simply because the injury is in

dispute and you otherwise agree with the rating. See AP decision 043105-s, which states that where the claimant does not have a compensable injury, an

2006 QUESTION RESOLUTION LOGS

Prepared by DWC Customer ServicesThese answers have been reviewed by a representative of Legal Services and members of the Question Resolution Committee. As policy directives change, responses to the questions may change.

# Date Received

Question / Problem

Date Answered Resolution

06-06 2-22-06 Section 408.027 of the Act provides that a health care provider (HCP) shall “submit” a claim for payment to the insurance carrier not later than the 95th day after the date on which the health care services are provided to the injured employee.

Please define “submit.”

Is the submission date under this section the date the HCP SENDS the medical bill or the date the carrier RECEIVES the bill?

2-22-06 The term “submit” is used in the same manner as the term “sent.” Rule 102.4(h) provides the following instructions to determine when documents are sent:(h) Unless the great weight of evidence

indicates otherwise, written communications shall be deemed to have been sent on:

(1) the date received, if sent by fax, personal delivery or electronic transmission or,

(2) the date postmarked if sent by mail via United States Postal Service regular mail, or, if the postmark date is unavailable, the later of the signature date on the written communication or the date it was received minus five days. If the date received minus five days is a Sunday or legal holiday, the date deemed sent shall be the next previous day which is not a Sunday or legal holiday.

impairment rating based upon the non-compensable injury (although “valid”) may not become final pursuant to the 90-day rule even when the rating is not timely disputed. However, if the parties fail to timely dispute the first valid certification of maximum medical improvement and impairment rating and the compensability issue is resolved in favor of the claimant, the 90-day rule provision will apply unless one of the exceptions is shown. Thus, if you agree with the rating, you would want it to become final as you would only have to pay on it if the injury is compensable; on the other hand, if the rating is not accurate, then you want to ensure that your dispute is on file by filing a request for a BRC.


# Date Received

Question / Problem


06-05 2-15-06 1. Can the AWW for computing TIBs for a school district employee be adjusted to zero during Christmas break and other such breaks (such as spring break) under Rule 128.7(d) if the employee would not have earned wages during the break for dates of injury on or after 12-1-01? 2. Can the AWW for computing IIBs, LIBs, SIBs or TIBs for a school district employee be adjusted to zero during this type of break?

2-23-06 This answer applies to date of injury on or after 12-1-01

1. Yes, Rule 128.7(d) (3) allows the average weekly wage for TIBs be adjusted to zero for a period a school district employee would not have earned wages and no minimum benefit payment may be required. 2. No, the AWW cannot be reduced to zero for IIBs, LIBS, SIBs, or TIBs for a school district employee according to Rule 128.7(e).

06-04 2-14-06 What, if any, interest is due after an insurance carrier receives form DWC-3, Employer’s Wage Statement, that indicates a higher TIB rate is owed; therefore, the carrier must adjust the TIB rate?

Rule 128.1(e) requires the carrier to begin payment of benefits based on the new AWW no later than the first payment due at least seven days following the date the carrier receives the new AWW information.

Rule 126.12(a) defines accrued but unpaid income benefits as:

(1) benefits that accrued during a period of dispute over liability or entitlement to benefits; or (2) benefits that have not been paid by the date the carrier was required to pay them.

Rule 126.12(b) provides that carriers shall include simple interest in all payments for accrued but unpaid income benefits.

2-22-06 Interest is due on the amount of the difference owed from the date benefits were paid at the wrong rate to the date the correct rate is paid.

Interested should be calculated separately for each week from the date a payment was made at the wrong rate to the date payment is made at the correct rate.

The interest rate table to calculate the correct interest rate is on our website:

www.tdi.state.tx.us.

Click on Division of Workers’ Comp home

Click on Public Information

Click on Discount Rates/Interest Rates

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# Date Received

Question / Problem


06-03 01-12-06 Rule 180.21(j)(11) provides that a designated doctor can be deleted or suspended from the DDL or be sanctioned if the designated doctor self-refers for treatment or becomes the employee’s treating doctor for the medical condition evaluated by the designated doctor; or...

The designated doctor referred the injured worker to a surgeon for an opinion regarding the need for surgery and for diagnostic testing. The injured worker now wants to change treating doctors to the referral doctor for treatment for the condition evaluated by the referral doctor.

Does the Act or rules prohibit an injured worker from changing their treating doctor to the referral doctor chosen by the designated doctor?

02-21-06 No. There is nothing in the Act or rules that prohibits a referral doctor (selected by the designated doctor) from becoming the injured worker’s treating doctor for an examination related to certification of MMI/IR.

However, if the Division approves the injured worker’s request to change treating doctors to the referral doctor, and the injured worker is sent back to a designated doctor, the designated doctor would have to select an alternate referral doctor, if necessary.

NOTE: This answer is related to non-network circumstances only.

06-02 01-12-06 Section 415.002(a) of the Act states, “An insurance carrier or its representative commits an administrative violation if that person: (21) makes a statement denying ALL future medical care for a compensable injury; or...”

Please define “ALL” medical care.

Does this section allow a carrier to deny medical care for a particular body part or condition without being in violation of this section of the Act?

Example: An injured worker injures his back and arm. The carrier denies additional medical care for the arm only.

Is the denial of additional medical care for the arm only, not the back, considered a denial of ALL medical treatment under this section?

02-21-06 Section 408.021 of the Act provides that an injured employee is entitled to all health care reasonably required by the nature of the injury as and when needed.

Once the carrier has accepted compensability of an injury, the carrier may not prospectively deny ALL future medical care for that injury.

The denial of ALL future medical care for any individual compensable body part or condition or the denial of ALL future medical care for all of the compensable body parts or conditions would not be in compliance with Section 415.002(a) of the Act.

F O L I O C L I E N T N E W S L E T T E R B Y F L A H I V E , O G D E N & L A T S O N ��

# Date Received

Question / Problem


06-01 11-17-05 Preauthorization/Change of Treating Doctor

Synopsis:

The carrier denies preauthorization for surgery. An IRO (through Medical Dispute Resolution) finds the surgery is necessary and this decision is not appealed. The injured worker then changes his or her treating doctor.

Question: Does the fact that the injured worker changed treating doctors invalidate the preauthorization approval?

1-12-06 No. Rule 134.600(b) (1) (B) provides that the carrier is liable for all reasonable and necessary medical costs relating to health care for the compensable injury that was preauthorized prior to providing the health care.

Last updated: 04/05/2006

INTERIM SOLUTION wHEN REQUESTING RME OR DDR

Because two networks have been certified, and because the Act requires different processes for appointment of RME doctors and Designated Doctor for claimants employed by employers adopting a network, DWC has proposed an interim solution for carriers to use when requesting an RME or a DDR.

Until DWC develops new forms after the adoption of the new RME and Designated Doctor Rules, carriers are directed to use the current Form-22 and Form-32, but to indicate in the top left-hand corner whether the request applies to an employee that is subject to a certified network or an employee not subject to a certified network. Carriers should indicate this by writing “NON” for employees not subject to a network, and write “NET” for employees subject to certified network treatment. To comply with this DWC request, persons completing Form-22 and Form-32 should start indicating either “NON” or “NET” on all forms 22 and 32. If it would help the claims representative to remember the meaning of these terms, it is certainly acceptable to fully describe

the respective applicable term in the top left hand corner as “Non Network” and “Network.”

In summary, DWC has requested that carriers immediately begin designating the DWC-22s and DWC-32s as described. It is unlikely that DWC will adopt new rules for these exams until sometime after May or June. The new forms should follow soon after. Until then, FO&L recommends that you begin using this process per the request of DWC.

The HB 7 imposes the same tiered performance measures for healthcare providers as well as carriers. This program is not part of a “network score card” which is independently required of networks but not carriers.

Performance Based Oversight will be discussed in future meetings. DWC will be developing rules to implement the program over the summer. Again, claim files handled on the day that the carrier read this analysis will be subject to the audit metrics to be developed over the ensuing months. This is the first public announcement of the basic framework presently contemplated by TDI/DWC, which is intended to be fully operative by September 2006.

HB performance based oversight – continued from p. 1


PAIN MANAGEMENT DOCTOR INDICTED

FOR FRAUD

Dr. Ishan Shanti, a Houston pain management doctor, and his facility, Shanti Pain & Wellness Clinic, has been indicted by a Travis County grand jury.

Dr. Shanti is charged with felony workers’ compensation fraud relating to medical billing of services between January and March 2003. The alleged fraud is over-billing by charging for pain management services in excess of the hours actually attended by the patients.

This indictment illustrates the value of looking behind the billing to the medical documentation and other evidence sources to determine whether the services that were billed were actually rendered by the medical provider.

An interview of the injured worker may well show that the actual activities done in therapy and multi-disciplinary programs do not equal the billed time or that the activities do not actually constitute appropriate treatment. Given the high cost of many of these programs a closer look is often warranted. A short telephone contact with the injured worker during or shortly after the treatment program can review the amount of time spent engaged in each activity of the program and the nature of the treatment.

If discrepancies are revealed, a more detailed recorded interview should be done and the medical billing can be disputed on the basis that the preauthorized services were not rendered.

ADMINISTRATIVE ENFORCEMENT

Compliance & Regulation receives hundreds of violation referrals a week. Violation referrals that do not contain an allegation of fraud are processed by the Division’s Audits & Enforcement section within Compliance & Regulation. Administrative Violations may include allegations of late payment of benefits or late filing of required reports. Administrative Violations are only pursued through administrative remedies (Warning Letters, Penalties). Further information about fraud.

Highlights of Recent Administrative Enforcement Actions Following are examples of penalties issued during the current fiscal year and are based on seriousness of the violation, history of previous violations, demonstrated good faith of the violator, economic benefit from the prohibited act, penalty necessary to deter future violations, and other matters that justice may require. The differences in the penalty amounts for seemingly similar violations are due to the factors listed above. For instance, if a system participant has history of committing a similar violation, the penalty amount may be higher than for a second offense.

Failure to produce documents:

The carrier failed to produce documents pursuant to a Division order -106 days late -Fined $10,000

The medical provider failed to produce documents pursuant to a Division order -176 days late -Fined $500

Failure to timely file a required form:

The carrier failed to timely file a Notice of Disputed Issues(s) and Refusal to Pay Benefits -223 days late -Fined $5,000

Failure to timely process a medical bill:

The carrier failed to timely process a medical bill -209 days late -Fined $2,350

The carrier failed to timely process a medical bill -690 days late -Fined $4,857

Failure to timely pay according to an order:

The carrier failed to timely comply with a Hearing Order -297 days late -Fined $1,921

The carrier failed to timely comply with a Hearing Order -229 days late -Fined $1,840


The carrier failed to timely comply with a Contested Case Hearing Order -214 days late -Fined $10,000

The carrier failed to timely comply with an order to pay attorney fees -131 days late -Fined $5,000


The carrier failed to timely comply with an order to pay attorney fees -1,260 days late -Fined $5,000

The health care provider failed to timely comply with a medical dispute order to refund the carrier -117 days late -Fined $1,840

The carrier failed to timely comply with a medical dispute order -329 days late -Fined $4,570


The carrier failed to timely comply with an Interlocutory Order -16 days late -Fined $10,000

The carrier failed to timely comply with a medical dispute order -159 days late -Fined $2,638

Failure to pay benefits:

The carrier failed to timely pay temporary income benefits -23 days late -Fined $1,434

The carrier failed to timely pay temporary income benefits -57 days late -Fined $4,813

The carrier failed to timely pay impairment income benefits -500 days late -Fined $2,500



Improperly pursuing a private claim against an injured worker:

The health care provider inappropriately billed an injured worker for treatment of the workers’ compensation injury -Fined $143

The health care provider inappropriately billed an injured worker for treatment of the workers’ compensation injury -Fined $1,868

The health care provider inappropriately billed an injured worker for treatment of the workers’ compensation injury -Fined $588

Failure to respond to a Letter of Clarification request

The provider failed to timely respond to the request -57 days late -Fined $500

The provider failed to timely respond to the request -50 days late -Fined $387

continued on p. 18

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CASE DECISIONS TEXAS COURT OF APPEALS

Fidelity and Guaranty Ins. Co. v. Drewery Construction Co., No. 05-0295 (Tex., February 24, 2006).

When a default judgment is attacked by a motion for a new trial or bill of review in the trial court because the defendant lost the suit papers after receiving them, the default judgment should be set aside only if the defendant proves the three Craddock elements.

FACTS: In this suit on a surety bond, Drewery Construction Company, Inc., a subcontractor, obtained a default judgment against Fidelity and Guaranty Insurance Company, surety for the general contractor, JenCra, Inc. Fidelity filed a motion for new trial explaining that the service papers had been lost. The trial court denied the motion, and the court of appeals affirmed.

HOLDING: Reversed and remanded. When a default judgment is attacked by a motion for a new trial or bill of review in the trial court, the parties may introduce affidavits, depositions, testimony, and exhibits to answer a critical question: “Why did the defendant not appear?” If the answer to the question is “Because I didn’t get the suit papers,” the default generally must be set aside. Failure to give notice violates the most rudimentary demands of due process of law. Exceptions to this rule exists when nonreceipt is uncorroborated or was bill-of-review claimant’s own fault. But if the answer to the critical question is “I got the suit papers but then…,” the default judgment should be set aside only if the defendant proves the three Craddock elements: it requires a new trial if the defendant shows (1) default was neither intentional nor conscious indifference, (2) meritorious defense, and (3) new trial would cause neither delay nor undue prejudice. Drewery argues, and the court of appeals held, that Fidelity failed to establish only the first—whether the default was the result of accident or mistake. Neither the Corporation Service Company nor Fidelity could verify whether Drewery’s suit papers were actually forwarded by CSC to Fidelity as CSC should have done in the ordinary course of business. The Fidelity’s four affidavits attached to its motion for new trial were not general nor conclusory; they detail the procedures for handling service papers in general and what is known about Drewery’s papers in particular. An affidavit from the person who lost them describing how it occurred is not required.

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The treating doctor’s failure to order an MRI does not, in and of itself, establish prior inadequate or improper medical treatment for purposes of Labor Code, Section 408.123.

FACTS: The claimant sustained a low back injury. Thereafter she received conservative treatment that included x-rays and physical therapy at the direction of Dr. S. Ultimately Dr. S certified that the claimant reached MMI October 28, 2004 with a zero percent impairment rating. The parties stipulated that this impairment rating was not disputed by the claimant within 90 days of her receipt.

The claimant was able to return to work. She sought additional care with Dr. S in April of 2005. Dr. S’s reports noted “recently progressive symptoms.” Dr. S requested an MRI that was performed on April 10, 2005. The MRI reflected disc desiccation and a 3-mm broad-based bulge at L1-S1 and L4-5.

The claimant contended that the Section 408.123 exceptions applied in that the care she received prior to the MMI certification was improper or inadequate and that there was a clearly mistaken diagnosis or previously undiagnosed medical condition.

The Hearing Officer concluded that the impairment rating did not become final due to prior improper or inadequate treatment. The carrier appealed.

HOLDING: Reversed and remanded. “There is no medical evidence, much less compelling medical evidence

required by Section 408.123 (f) that failing to order an MRI for a back sprain which caused claimant to fall to the floor and unable to get up constituted improper or inadequate treatment.” However, the Appeals Panel notes that the claimant also contended that she had a previously undiagnosed medical condition. Because of the lack of comment on this contention by the Hearing Officer the Appeals Panel remands to the Hearing Officer for further consideration and discussion of the evidence.

NO. 060132


An impairment rating that is based upon a disputed condition can not become final in the absence of a resolution of the extent of injury dispute.

FACTS: The designated doctor certified the claimant reached MMI and provided a 10% impairment rating based upon placement in category DRE III. Placement in category III requires the presence of radiculopathy. The designated doctor found that the claimant had radiculopathy, but specifically stated in the narrative report that the radiculopathy was caused by degenerative changes and not the claimant’s injury. Several months later, the designated doctor responded to a request for a clarification on this point by changing the impairment rating to zero percent.

The issue at the Contested Case Hearing involved the finality of the initial impairment rating of 10%. The carrier contended that the rating resulted from a “significant error” by the designated doctor in the application of the Guides. The carrier acknowledged that the 10% impairment rating had not been disputed within 90-days of its receipt.

The Hearing Officer determined that the impairment rating became final. The carrier appealed.

HOLDING: Reversed and remanded. The Appeals Panel references prior decisions for the proposition that “extent of injury” is a threshold issue to an impairment rating dispute. The Panel notes that the carrier had filed a PLN disputing the degenerative changes in the lumbar spine. “Before an IR can be determined, whether or not the compensable injury extends to include radiculopathy must be decided.” The Appeals Panel remands to the Hearing Officer for a determination as to whether or not the compensable injury includes radiculopathy. Based upon the Hearing Officer’s determination on that issue, the Appeals Panel directs the Hearing Officer to reconsider the holding on the issue of the finality of the impairment rating. If the Hearing Officer concludes that radiculopathy was part of the compensable injury, the Appeals Panel instructs that the initial impairment rating will have become final.

NO. 060170-S


In order to establish a compensable mental trauma injury, a claimant must provide medical evidence establishing within a degree of reasonable medical probability that the mental trauma injury results directly from a specific incident.

FACTS: The claimant worked as a juvenile correction officer. The job description made clear that the job was, at times, stressful. Issues developed between the claimant and her employer concerning the claimant’s belief and reports of inappropriate contact between staff and students. Over a period of more than a year these issues developed and resulted in meetings between the claimant, an attorney she hired to assist her in her employment related issues and her supervisors. At one of these meetings the claimant was apparently told by her supervisor that her withholding of information concerning potential sexual abuse of a student could represent a misdemeanor. The claimant contended that this particular incident led to her claimed mental trauma injury. The Hearing Officer found for the claimant. The carrier appealed.

HOLDING: Reversed and rendered. The Appeals Panel provides a complete discussion of prior case law and its prior holdings concerning repetitive mental trauma injuries. The Panel notes that, “The cause, progression, and aggravation of mental disease is a subject of such a technical nature that expert medical evidence is required.” They further reference prior decisions for the proposition that, “There must be evidence of a reasonable medical probability that the mental trauma was caused by a specific event.” The Appeals Panel notes that the claimant’s medical reports reference only “severe stress related to recent developments at work” and that “the actions of her employer have led to severe mental anguish.” There was no indication in the medical reports that the claimant’s condition was caused by the specific incident to which the claimant refers. The decision of the Hearing Officer is reversed and a decision is rendered that the claimant did not sustain a compensable injury.

NO. 060176

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Administrative Fraud enforcement Action:

-18 Notice of Violations Issued -$9,150 in penalties issued -$34,812.74 in restitution ordered -20 Warnings issued (e.g. no monetary loss, no restitution ordered)

*State fiscal year runs September 1st through August 31st.

DISCOUNT RATE AND INTEREST RATE

DETERMINED

AUSTIN, TX— The Texas Department of Insurance, Division of Workers’ Compensation has determined, pursuant to the authority and direction given under the Texas Workers’ Compensation Act (Texas Labor Code, Section 401.023), that any interest or discount provided for in the Act shall be at the rate of 8.26 percent. This rate is computed by using the treasury constant maturity rate for one-year treasury bills issued by the United States Government, as published by the Federal Reserve Board on March 17, 2006 (4.76 percent) plus 3.5 percent as required by Section 401.023. The rate shall be effective April 1, 2006 through June 30, 2006.

For more information, please call Joseph Meyer at 512-463-6143 regarding rate calculation or Robert Brown at 512-804-4079 regarding application of the rate.

Issued in Austin, Texas, on March 31, 2006.Albert Betts, CommissionerDivision of Workers’ Compensation

Administrative enforcement – continued from p. 13


TDI ADOPTS NETwORk ENDORSEMENT

TDI amended the Texas Basic Manual of Rules to include the new endorsement (WC 42 04 08) to be added to each policy in which the insured chooses to participate in the employer network.

The amount of any premium reduction or credit for participation in the network must be referenced on the information page of the policy and is to be determined by applying the network credit factor to the estimated modified/schedule rating premium. The reduction “can be” prorated based on when during the policy period the policyholder elects to participate in a certified network.

This endorsement must be forwarded to each insured at the time the policyholder “elects” a certified network. This rule was formally published in the 3/31/06 Texas Register and becomes effective on April 15, 2006.

We recommend that you immediately forward this Advisory to your underwriting related departments.

DIVISION TO HOLD PUBLIC HEARING ON BENEFIT REVIEw CONFERENCE AND INTERLOCUTORy

ORDER RULES ON MAy 10

AUSTIN, TX — The Texas Department of Insurance (TDI), Division of Workers’ Compensation will hold a public hearing on Wednesday, May 10, 2006 in the Tippy Foster Room of the Division’s Central Office located at 7551 Metro Center Drive, Suite 100 (near the intersection of Highway 71 and Riverside Drive) in Austin.

The public hearing will begin at 2 p.m. and the Division will take testimony on the following rules:

Chapter 141 Dispute Resolution Benefit Review Conference

Rule 141.5 Description of the Benefit Review Conference

Rule 141.6 Interlocutory Orders (Current Title)

Requesting Interlocutory Orders (Proposed Title)

Rule 141.7 Commission Actions After a Benefit Review Conference (Current Title)

Division Actions After a Benefit Review Conference (Proposed Title)

These proposed rules were published in the Texas Register on February 17, 2006, and may be viewed on the TDIwebsite at http://www.tdi.state.tx.us/wc/rules/planning/requestio.html .

Although the comment period for these rules closed on March 20, 2006, additional comments will be accepted at the hearing. TDI offers reasonable accommodations for persons attending meetings, hearings, or educational events, as required by the Americans with Disabilities Act. If you require special accommodations, contact Idalia Cantú’ at 512-804-4403 a minimum of two days prior to the hearing date.

For further information regarding this notice, contact Kevin Haywood of the Division’s Legal Services at 512-804-4424.

JUDGE: LaCk of hearing in meDiCaL DiSPuteS may

be unConStitutionaL

A Travis County district judge issued a temporary injunction in a dispute over hospital fees relating to an invalidated 1992 hospital fee guideline. The decision represents a conclusion that could have significant implications for current fee guidelines.

The lawsuit was filed by HCA Healthcare Corporation, Tenet Healthcare Corporation, Memorial Hermann Healthcare System and other interested parties in response to the issuance of 1,406 medical dispute resolution decisions by the Division of Workers’ Compensation. MRD denied reimbursement, and for disputes of MRD decisions after 9/1/2005, the hospital’s only remedy was to file an appeal on all cases.

The current process for dispute resolution in medical fee issues is a formal response before DWC, and then an appeal to the District Court a review of the agency “record.” There is no hearing at DWC, so there is no record. The statutes governing the Courts and the DWC are inconsistent.

DWC was enjoined from issuing further medical dispute resolution decisions relating to payment of the


hospital claims presented by those hospital systems without first providing “a meaningful opportunity to be heard, including the right to notice and an appearance with the opportunity to present the disputing parties positions on the reimbursement dispute.”

The order also set trial on the merits of the case in 353rd District Court for 9 a.m. on Aug. 7, 2006. Judge Margaret Cooper is expected to preside.

NEw RULES REGARDING PRE-AUTHORIzATION AND

MEDICAL BILLING AND REIMBURSEMENT

On April 11, 2006, the Texas Department of Insurance, Division of Workers’ Compensation adopted new rules regarding pre-authorization and medical billing and reimbursement. These new rules will be published in the Texas Register on April 28, 2006 and will become effective on May 2, 2006.

Pre-authorization procedures are governed by Rule 134.600. In addition to some newly defined terms, the new Rule 134.600 specifies that when there is a conflict between Division-adopted treatment guidelines and the Rule, the Rule controls.

The process for requesting pre-authorization is relatively unchanged. However, a health care provider can now request pre-authorization for an injury or diagnosis that has not been accepted by the carrier. To do so, the provider must include a treatment plan for sixty (60) days. When such a request is received, the carrier should review the request for both medical necessity AND relatedness issues. This is a significant difference from the earlier version of the rule, when only medical necessity was considered during the pre-authorization process. If the request is denied, the carrier must indicate whether the denial is due to medical necessity or relatedness concerns. If the denial is based upon medical necessity, the requestor or employee may request medical dispute resolution. If the denial is based on relatedness, the carrier must alert the requestor or employee of the right to file an extent of injury dispute (by

requesting a benefit review conference). A denial based on relatedness is not subject to medical dispute resolution.

Many of the services that previously required pre-authorization and concurrent review continue to do so. In addition, the new rule clarifies that non-exempt work hardening and work conditioning program are subject to both pre-authorization and concurrent review, as are required treatment plans. Treatment for injuries and diagnoses not accepted by the carrier as well as treatment services that exceed or are not addressed by adopted treatment guidelines and not contained in a treatment plan pre-authorized by a carrier are also subject to pre-authorization. Pre-authorization is required for drugs not included in the Division’s formulary. The substance of the rules regarding voluntary certification are essentially the same as they were under the old Rule 134.600.

On the medical billing and processing front, the Division repealed Rules 133.1, 133.2, 133.100, and 133.104-133.106 regarding required reports, Rules 133.300-133.304 regarding the dispute and auditing of bills by insurance carriers, Rules 133.401-133.403 regarding the production of documents, and Rules 134.1, 134.5, 134.6, 134.800, 134.801, and 134.803 concerning medical policies and provider billing procedures. In place are new rules for medical billing, bill processing, medical reimbursement, and medical bill reporting. The new rules are designed to minimize micro-management of the system, utilize existing Medicare reimbursement structures, and incorporate concepts from TDI managed care rules for consistency and standardization.

The new rules apply to medical billing and processing for healthcare services provided in and out of workers’ compensation networks, with three exceptions applying to services offered to workers subject to networks. The new chapter regarding general medical provisions applies to all heath care offered on or after May 2, 2006. For health care rendered prior to May 2, 2006, the rules in place on the date of service control.

Health care providers shall submit medical bills using the standard forms created by the Centers for Medicare and Medicaid Services, on the forms prescribed for dentists and pharmacists,

F O L I O C L I E N T N E W S L E T T E R B Y F L A H I V E , O G D E N & L A T S O N 2�

or in the specified electronic format. Medical bills should not be submitted later than the 95th day after the date of service. If the carrier indicates that the medical bill is incomplete, the health care provider has 15 days to either submit the additional requested documentation or provide notice that the provider does not have the requested information.

A health care provider may elect to submit its bill to the injured employee’s employer if the employer has indicated a willingness to pay the bill(s). However, a provider who does so waives, for the duration of the election period, the right to prompt payment, interest for late payment, and medical dispute resolution. The carrier must be provided an information copy when the employer is billed. An employer cannot be billed for charges the carrier has reduced, denied, or disputed.

Carriers should continue to process bills as they have in the past. However, carriers now have 30 days instead of 7 days to return incomplete bills (carriers should still attempt to complete the bills when possible).

“Medical documentation” has now been defined and the Division has outlined the specific medical documentation that must be submitted to support specific services (i.e. a copy of the operative report to support surgical services).

A carrier has either 240 days from the date of service, or 30 days from the completion of an audit, whichever is later, to request a refund from a provider. Providers continue to have 45 days to comply with the request. A provider must include interest if the refund is not offered within 60 days of the request for the refund.

Injured employees and employers may both seek reimbursement for out-of-pocket expenditures. Carriers must pay or deny the request for reimbursement with 45 days of the receipt of the request. An injured worker or an employer may seek reimbursement for any overpayment made to a provider.

Network rules govern reimbursement for network care. Non-network care remains subject to Division guidelines, negotiated contracts, or a fair and reasonable amount.

Treating doctors can be reimbursed for attendance at required medical evaluations ($100 per hour). Travel time includes round trip travel via the most direct route from the doctor’s office to the place of the examination. This applies to all required medical evaluation scheduled on or after May 2, 2006.

The rules regarding reimbursement for an injured worker’s travel expenses have changed. Now, reimbursement is only due if an injured worker must reasonably travel more than 30 miles, and not 20 miles as previously required. This applies to all dates of travel on or after May 2, 2006.

A carrier does not need to reimburse a provider the initial copy of medical documentation, but if subsequent copies are requested, the provider should be reimbursed. An employee or his/her representative is entitled to a complimentary copy as well. However, if the employer or representative requests a narrative report, the requestor must reimburse the provider for the report. Reimbursement amounts for copies, films, and narrative reports are included in the new rule.

OHIO CHIROPRACTOR CLAIMS HE CAN GO

BACk IN TIME (AND yOU THOUGHT

wE HAD PROBLEMS IN TEXAS)

A chiropractor who claims he can treat anyone by reaching back in time to when an injury occurred has attracted the attention of state regulators in Ohio.

The Ohio State Chiropractic Board, in a notice of hearing, has accused James Burda of Athens of being “unable to practice chiropractic according to acceptable and prevailing standards of care due to mental illness, specifically, Delusional Disorder, Grandiose Type.” Burda denied that he is mentally ill. He said he possesses a skill he discovered by accident while driving six years ago.

“My foot hurt and, knowing anatomy, I went ahead and I told it to realign and my pain went away,” Burda said Thursday. Burda calls his treatment “Bahlaqeem.” Said the chiropractor: “All treatments are satisfaction-guaranteed.”


HOSPITAL FEE TEST CASES SET FOR SOAH TRIAL IN

JUNE

The Hospital Fee litigation has been pending before DWC, SOAH, and/or the State District Courts for over 7 years. At one time, the hospitals presented over 20,000 cases involving the invalidation of the 1992 Hospital Fee Guideline by the Austin Court of Appeals in 1996.

The Court of Appeals declared that approximately 16,000 of those cases were time barred because of the hospitals’ failure to file these claims within one year of the date of service. More recently about half of these cases were adjudicated by DWC and there is an argument that the appeal was not timely filed to Travis County District Court and that res judicata may prevent litigation of those claims adjudicated.

From the population of cases pending at SOAH, the Administrative Law Judge selected three cases as representative test cases. Discovery has been now closed on those three cases. The carriers have deposed the experts designated by the hospitals, and the hospitals have deposed Dr. Ron Luke and Dr. Nick Tsourmas, the carrier’s primary witnesses.

The test cases are set for trial before ALJ, Henry Card, on June 12th. The resolution of all cases will depend in large part upon the decision entered in the joint test cases (or after an appeal by one party or the other). Rather than individually trying all cases, it is hoped that a thorough trial of several cases will set a precedent and that all parties will abide by the precedent. It is a good approach to this very complex piece of litigation.

FOLIO will report on the results of the June trial in the July edition of FOLIO.

F O L I O C L I E N T N E W S L E T T E R B Y F L A H I V E , O G D E N & L A T S O N 2�

FLAHIVE, OGDEN & LATSON DIRECTORy

Attorneys Direct Dial (512)

Direct Fax*(512)

E-Mail **Initials@FOL. Paralegal Paralegal

(512)

Bobby Stokes 435-2150 867-1705 RDS Anita Drake 435-2249

Carlos Acosta 435-2177 867-1712 CA1 Sally Stephens 435-2242

Chris Johnson 435-2182 867-1728 CPJ Cynthia Sherman 435-2274

Chuck Finch 435-2158 867-1713 CCF Marci Roberts 435-2223

Dana Gannon 435-2151 867-1710 DMG Margo Davis 435-2263

Greg Solcher 435-2175 867-1718 GDS Sally Stephens 435-2242

Jack Latson 435-2156 867-1701 JWL Patsy Shelton 435-2234

James Sheffield 435-2169 867-1703 JRS Sharissa Karol 435-2224

Jeremy Lord 435-2184 867-1711 JXL Anita Drake 435-2249

Katie Flahive 435-2168 867-1702 KMF Gina Mitschke 435-2229

Kevin Macewan 435-2166 867-1706 KEM Cynthia Sherman 435-2274

Lynette Phillips 435-2165 867-1708 LLP Sharon Youso 435-2233

nancy Ippolito 435-2181 867-1721 NHI Sharon Youso 435-2233

Pamela Peavy 435-2163 867-1736 PEP Marilyn Mueller 435-2222

Paul Stone 435-2157 867-1716 PBS Bronna Sanders 435-2269

Paul Warren 435-2159 867-1719 PDW Karen VanLoo 435-2240

rebecca Strandwitz 435-2160 867-1720 RMS Andrea Tuttle 435-2228

rhett robinson 435-2154 867-1709 SRR Bronna Sanders 435-2269

rob Dollars 435-2164 867-1707 RAD Karen Vanloo 435-2240

ron Johnson 435-2178 867-1722 RMJ Marci Roberts 435-2223

roy Leatherberry 435-2179 867-1714 RJL Andrea Tuttle 435-2228

Scott Bouton 435-2153 867-1737 SDB Sharon Durr 435-2230

Steve Tipton 435-2162 867-1704 SMT1 Mary Casebier 435-2275

Susan Veltman 435-2152 867-1717 SRV Sharon Durr 435-2230

Tom Wilkins 435-2183 867-1727 TRW Gina Mitschke 435-2229

Tricia Blackshear 435-2180 867-1723 PHB Marilyn Mueller 435-2222

*Attorney’s direct dial fax no. is directed to his/her paralegal.**Alternative e-mail address: first initial+last [email protected] (example: [email protected])

F O L I O C L I E N T N E W S L E T T E R B Y F L A H I V E , O G D E N & L A T S O N2�

kEy TASk DIRECTORy

To help expedite your faxed information to the correct area within FO&L and get it to the responsible person at the earliest time, use the following fax directory. Please remember the 3:30 p.m. receipt deadline for material required to be date stamped at the Commission. Material received after 4:00 p.m. does not permit time to deliver it across town prior to the DWC close.

Task Contact Person Direct Dial (512)

Fax No.(512)

[email protected]

Administrative Violations – C&P Dianne Townsend 435-2289 867-1724 DLT

BrC Settings (request For evidence) Cindi Friedel 435-2244 477-4987 CAF

Disputed Claims (PLns)

request for BrC (TWCC-45)Tillie Aguirre 435-2235

477-4996TAA

General Questions Receptionist 477-4405 867-1700 GQS

Insurance Coverage (TWCC-20)

records requests/PhotostatsPhyllis Devine 435-2267 867-1748 PAD

Medical Dispute resolution Katie Foster 435-2266 867-1733 KTF

Client Consultant Trina DeCecco 435-2239 867-1700 TAD

PrMe Service Brian Fitzgerald 435-2227 477-4987 [email protected]

Designated Doctor Filings Brandi Senters 435-2299 479-5319 BES

TWC Manual Sales Joel Ogden 435-2256 472-9160 JMO

Flahive, Ogden & LatsonAttorneys at LawP. O. Box 13367

Austin, TX 78711

HB PERFORMANCE BASED OVERSIGHT

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