Restitution of Medical-Legal Evaluations Rejected

An appellate decision has indicated that carriers or self-insured, may not obtain restitution for medical -legal expenses previously paid in cases involving American Psvchometric Apex Medical.

The Court went into a lengthy discussion in regards to medical-legal expenses under all appropriate provisions of the Labor Code. The Court also discussed the 1993 Amendments and what may be declatory of existing law or applied retroactively.

The Court referred to the Otis v. City of Los Angeles case and intimidated that the case is still good law. This means the carrier or self-insured has to make an appropriate objection within 60 days. The decision also gave credence to the previous Board decision of Del Rio v. Quality Hardware. Thus, the “contested claim” rule is given effect. The opinion also intimates that the employer/carrier does not have to protest a medical-legal expense when the medical provider does not comply with the “contested claim” rule.

The opinion discussed Labor Code section 4625 and concluded this section only dealt with excessive medical-legal fees rather than fees generated before the existence of a “contested claim”.  This section only dealt with fees in excess of the official medical fee schedule and not restitution of a fee in its entirety. It was specifically stated this section does not permit restitution where a medical-legal fee has been paid without protest in case involving uncontested claims.

In all three cases that were presented and decided in this opinion, the medicals were derived shortly after the claim form. Therefore, there was no “contested claim” at the time. In all three of the cases, the carrier negotiated the liens and paid partial amounts.  Thereafter, all three sought restitution for those amounts previously paid. The Court indicated the employer/carriers were quick to accuse the medical providers of fraud even though they paid without protest. They also indicated that violation of a statute is.  not intentional misrepresentation which is the principal element of charged and proven fraud.

The Court looked to transactional Stability for the basis of its decision.  Approving restitution in this case would have unfortunate consequences for the workers compensation system and all business in general. The Court indicated that no one can run a business on receipts only conditionally received.  Medical providers are no exception.  Thus, the Court is giving you fair warning. If you decide to pay or negotiate and pay a medical legal expense or treatment do not expect to get your money back at some later date.  Investigate before you pay and make the necessary, appropriate, timely objection.

This does make sense from a business standpoint. The carrier would not expect the employer to ask for a refund of premium for the same transactional stability reasons.

Case: APEX Medical V. W.C.A.B.

Harvey Brown
3501 Jamboree Rd. Suite 602
Newport Beach, CA 92660

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