Non-IBR Medical Legal Disputes Increasing Litigation, and The Remedial Steps You Need to Take

by Patrick C. Gorman (December 6, 2017)

The Perfect Lien Defense

You receive an odd looking Petition, titled “Petition for Determination of Non-IBR Medical Legal Dispute” from the friendly neighborhood workers’ compensation chiropractor, on a case you settled in 2014. The Petition is requesting $6,000 for a “consultative report”, and a series of diagnostic studies, plus $600 in penalties, $2,651.25 interest “thereon”, and $1,000.00 in attorney’s fees for 2.5 hours spent drafting the Petition. Also accompanying the petition is a Declaration of Readiness to Proceed.

Like any diligent attorney or claims professional, you check the public search function on the DWC website, and find you are set for a MSC on the Petition and DOR, in 21 days. You look at the Party Participant List, on the same page of the Public Search Tool, and perform a lien search. The Chiropractor has not filed a lien, nor has his attorney filed a lien filing fee. You think to yourself “gottcha!, this chiro did not timely file a lien! He also hasn’t paid a filing fee, or served the appropriate lien declaration! The WCAB has no jurisdiction to hear this case!”

For some reason you aren’t satisfied with that conclusion. You wonder: “Did I timely object to this chiropractor’s invoice? Why did he file this petition, and why did the WCAB set the matter for hearing, if he was not a case participant?”

You pull up the case from your archived files and recall that the case settled for $15,000 with a Thomas Finding, and denial of injury AOE/COE. You see that the applicant was represented by counsel. There is a DWC-1 claim form dated December 14, 2012, a delay notice went out December 27, 2012 and an app was filed on January 4, 2013.

An employer level investigation revealed applicant was fired for theft on December 1, 2012 and never reported an injury to her supervisor. On March 9, 2013 you issued a timely denial, asserting post termination defense.

There is only one medical report in your file, titled: “Initial AOE/COE Evaluation and Consultation” dated February 21, 2013, with a HICFA attached invoicing $6,000 for a “med-legal evaluation” and diagnostic studies. You’re relieved! You issued an objection letter to the chiro on March 9, 2013 stating that the invoicing from the friendly neighborhood workers’ compensation chiropractor does not constitute treatment and is not subject to Cal. Lab. Code § 5402. You now feel very satisfied that you are going to have a great day at the WCAB in 21 days, and put the file on your appearance shelf or casually refer out to counsel with an email stating “have fun with this one! Ha!”

The Brutal Reality

Fast forward 21 days: you are now feeling very different. The WCJ has told you that 1. Friendly neighborhood workers’ compensation chiropractor has standing to set this issue for trial, 2. You have no standing to litigate the reasonableness and necessity of the $6,0000 invoice, 3. Unless you responded to the 2/21/13 invoice and report in the form of an EOR you owe penalties, and 4. You better work out some attorney fee agreement with counsel for the friendly neighborhood workers’ compensation chiropractor.

SB 863 Amended Rights of Med-Legal Service Providers

This scenario is playing our across the state as we speak. From lien based chiros, to interpreters, diagnostic service providers, QME’s, and copy services, the cat is out of the bag. Pursuant to Cal. Lab. Code § 4622, you have 60 days from the date of receiving an invoice from a med-legal service provider to respond, and your response must be in the form of an EOR even if there is not an IBR dispute.

Given the broad spectrum of bill review vendor arrangements, odds are for the past nearly five (5) years, many medical legal provider invoices have not been properly addressed. What is most concerning, under the statutory scheme developed under SB 863 for addressing med-legal service invoices, there is no statutory timeframe for a provider to assert their right to recovery.

What Remedial Steps Should You Take?

What do you do? There must be a way to defend against these petitions! How do you protect yourself going forward?

In order to address these issues, the easiest thing to do is to ensure that every invoice, from the day you read this article, until the law changes, is responded to in the form of an EOR (see LC 4603.3). I can help your organization put together a template to work from, but EOR’s are elemental and must adhere to the requirements under the Labor Code.

What about all of those invoices you have been objecting to, but not in the form of an EOR, for the past 5 years? For an invoice to qualify as a med-legal expense it must fall under the definitions outlined in Cal. Lab. Code § 4620. The service must have been for the purposes of proving or disproving a contested claim (see LC 4620 for the definition of a contested claim) and it must be capable of proving or disproving a disputed medical fact essential to an adjudication of the employee’s claim for benefits. Your arguments are going to focus on procedural defects to the services or reports, admissibility, substantiality, the purpose of the services, and capacity.

Let B&B Help!

This is an emerging area of litigation, ripe for gamesmanship, and far too complex to cover entirely in this article. These two practice pointers should dramatically help you prevent litigation on future dates of service, and find footing in defending many claims for med-legal services from 1/1/2013 up to the date you begin responding in the form of an EOR.

Bradford & Barthel has put together a detailed 1 hour training program on this issue, which also qualifies for continuing education credits. Please contact me before you find yourself at the WCAB in the same position as the unfortunate attorney in this article, and avoid cutting a check to not-so-friendly neighborhood workers’ compensation chiropractor and his attorney.

Patrick C. Gorman, Esq. is a Partner at Bradford and Barthel, and Managing Attorney of the Redding Office. Mr. Gorman can be reached at (530) 242-6909 or

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