Workers’ Comp Case Attacks Basic Premise of System, Opens Door to Broader Liability

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The California Chamber of Commerce recently filed a friend-of-the-court brief in a California Supreme Court case that will determine whether doctors who review workers’ compensation cases can be sued for certain medical decisions.

The January 5 amicus brief in King v. CompPartners, Inc. (S232197) argues that the appellate court erred by ruling that utilization review doctors—who look at records to decide whether a worker’s treatment was appropriate, but do not examine the patient personally—have established a physician-patient relationship and therefore owe a duty of care to the injured workers.

“If allowed to stand, the decision will create extensive future litigation and can be expected to increase costs that will put upward pressure on malpractice premium rates for all physicians, and have a chilling effect on utilization review physicians,” the CalChamber amicus brief states.

The case also will determine whether medical malpractice claims against utilization review doctors are barred, because all workers’ compensation claims are under the purview of the state Division of Workers’ Compensation. Joining the CalChamber on the brief were national and statewide insurer groups.

“By establishing potentially unlimited liability for utilization review physicians,” the brief states, “the decision will increase overall costs of the system, which will put significant upward pressure on workers’ compensation premium rates for employers,” potentially lead to higher premiums for employers and could drive future and existing business away from California.

Background

According to court filings, the plaintiff in the case, Kirk King, sustained a back injury while on the job in February 2008. In July 2011, King suffered anxiety and depression due to chronic back pain resulting from the injury. He was prescribed an antianxiety drug.

Two years later, the workers’ compensation insurance company hired CompPartners Inc. to review the medical treatment for injured employees such as King. A CompPartners doctor, Naresh Sharma, decided King’s prescription was not medically necessary and the prescription was discontinued.

King sued, asserting he was injured due to seizures he suffered because of the sudden cessation of the drug. His lawsuit contended that Sharma and a second doctor employed by CompPartners had a duty to warn King of the dangers of abruptly ceasing the medication.

The trial court rejected the lawsuit on the grounds that the claim should have been handled through the workers’ compensation system. The Fourth Appellate District Court of Appeal partly reversed the ruling, finding that the trial court should have allowed King to amend his complaint because it was plausible that Sharma had a duty to warn King about the risk of seizures.

CalChamber Brief

In its amicus brief, the CalChamber argues that the appellate court decision “wrongly thrusts the utilization review physician, who merely read plaintiff’s treatment records and applied the appropriate treatment guidelines, in the role of a treating physician—with all of the concomitant duties and obligations that are properly the responsibility of the physician actually providing treatment to the patient.”

Utilization review communications are between physicians, and the reviewing physician “is acting solely as a gatekeeper for the prescribing physician,” the brief points out. The law makes peer-to-peer communication available if the prescribing physician wants to discuss the ramifications of a decision to deny or modify a treatment request, the brief states.

The brief concludes by urging the state high court to reverse the appellate court decision: “Letting this decision stand would result in wildly expanding potential liability in a system specifically designed to limit liability in exchange for certainty of benefits.”

The CalChamber amicus brief was prepared by Randall G. Poppy of Finnegan Marks Theofel Desmond APC.

Staff Contact: Heather Wallace

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Anthony Samson has been the CalChamber policy advocate for environmental regulation, housing and land use issues since November 2013. He previously was an attorney at Harrison, Temblador, Hungerford, and Johnson LLP, a statewide law firm that specializes in mining, land use, and natural resources law. He earned a B.A. from the University of California at Santa Barbara, and a J.D. from Michigan State University College of Law, where he served as the articles editor of the Michigan State Law Review.