Independent Medical Review (IMR)

One of the hallmark provisions of the most recent statutory amendments to the Labor Code, Independent Medical Review (IMR) has generated much litigation and even more speculation as to its ramifications and ultimate constitutionality.  Notwithstanding these factors, IMR has been heavily relied upon by employers and insurance carriers to control and mitigate medical treatment costs and resolve  unreasonable requests in a streamlined fashion.

Nevertheless, recent efforts from the Applicant’s Bar have focused on undermining the validity of IMR by challenging the timeliness of IMR decisions by referencing the language in Labor Code §4610.6(d) which states that the “Organization shall complete its review and make its determination in writing…within 30 days of the request for review and supporting documents.”

In a recent significant panel decision of Vega v. Maxium Healthcare (2016), the WCAB refused to cater to this “form over function” approach and instead determined that the language in Labor Code §4610.6(d) was directory rather than mandatory.  In doing so, the WCAB cited the legislature’s failure to enact provisions that invalidated IMR determinations if not issued within those timeframes. In Vega, Applicant sustained an admitted right knee injury. Ultimately, Applicant’s PTP recommended a total knee replacement, which was submitted to Utilization Review (UR) and subsequently denied. The UR decision was then appealed for Independent Medical Review, which ultimately failed to issue a decision within 30 days.

While acknowledging that the language of Labor Code §4610.6(d) appeared mandatory, the WCAB also observed that the IMR statutes “state neither a consequence nor a remedy.”  Moreover, the WCAB focused on the unequivocal legislative intent specifying that “in no event shall a workers’ compensation administrative law judge, the Appeals Board, or any higher court make a determination of medicalnecessity contrary to the determination of the Independent Medical Review organization.”  Based on this language, the court drew a distinction between UR and IMR with the later viewed as a governmental action, as opposed to the employer action of UR . The court concluded a determination by IMR “shall be deemed to be the determination of the administrative director and shall be binding on all parties.”

This distinction was key in the WCAB’s determination because “it has long been recognized that statutory provisions that guide governmental action in the conduct of business, and which do not limit its power or render its exercise ineffectual if the requirements are not met, IMR intended to provide order, system and dispatch in proceedings and as such are not usually regarded as mandatory unless in companied by negative words importing that the acts required shall be done in any other manner or time then that designated.”  In conclusion, the court determined that construing the timeframes as “directory” was in furtherance of the overall statutory design as it promoted the legislature’s goal of assuring that the objective medical treatment standards identified in Labor Code §4610.5(c)(2) were uniformly applied by medical professionals in all instances.  As such invalidating an IMR determination for failure to comply with Labor Code §4610.6(d) would be in direct conflict to the expressly intended purpose of the IMR statute.

While speculation surrounding the constitutionality of the IMR provisions of SB 863 will no doubt persist, the decision in Vega provides much welcomed clarity to workers’ compensation professionals regarding validity, timeliness and the injured worker’s remedy for appeal.  Undoubtedly, this will provide employers and carriers with greater certainty and minimize litigation costs moving forward.  Nevertheless, it is important to remain focused on the timelines, not only for filing an IMR appeal but also the carrier or employer’s response to provide documents to Maximus, not to mention the performance of the Utilization Review in the first place.

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