DECISION AND ORDER

I. Introduction

Twin City Fire Insurance Co. c/o The Hartford (Carrier) has appealed a decision of the Texas Workers’ Compensation Commission (TWCC) Medical Review Division (MRD) directing it to pay $9,216, plus all accrued interest, to Jim Sher, D.C.(the provider), for six weeks of work hardening services that he provided to ____ (Claimant), from September 18, 2001, to October 27, 2001. The only disputed issues are whether the services were preauthorized or medically necessary.

As set out below, the Administrative Law Judge (ALJ) finds that the disputed six weeks of work hardening services were not preauthorized nor medically necessary to treat the compensable injury. Accordingly, he denies the Provider’s request for reimbursement.

The Provider argues that the Carrier improperly reviewed the medical necessity of the Provider’s bill for the disputed six weeks of work hardening after the Provider had already obtained preauthorization from the Carrier. The Carrier denies that it improperly retrospectively reviewed medical necessity after preauthorizing those six weeks of work hardening.

It is unquestioned that the Provider never sought and the Carrier never specifically preauthorized the disputed six weeks of work hardening. Instead, after the first six weeks, the Provider sought and the Carrier’s representative preauthorized an additional two weeks of work hardening-weeks seven and eight, which are not in dispute. While it believes its representative erroneously approved weeks seven and eight when they were not medically necessary, the Carrier agrees that it is bound by that approval, paid for weeks seven and eight, and is not seeking reimbursement.

The Commission’s rule at the time did not require preauthorization for the first six weeks of work hardening. It did require preauthorization of any work hardening after six weeks. 28 Tex. Admin. Code §§ 134.600 (h)(11); 22 Tex. Reg. 1317 (1997) [later amended to otherwise provide; 26 Tex. Reg. 9874 (2001); eff. Jan. 1, 2002].

The Provider correctly points out that 28 TAC § 133.301(a) prohibits carriers from retrospectively reviewing the medical necessity of a medical bill for treatment or service for which a provider has obtained preauthorization. That would apply to the seventh and eighth weeks, but not the first six weeks for which no preauthorization was sought or required. Instead, that very same rule specifically requires carriers to retrospectively review bills not previously preauthorized, such as the first six weeks. The ALJ concludes that the first six weeks were not preauthorized, thus no retrospective review of medical necessity has occurred for those six weeks.

While the Provider never argued it, the ALJ also considered a related issue: does the Carrier’s preauthorization of weeks seven and eight-and implicit finding they were medically necessary-legally prevent the Carrier from now arguing that weeks one through six were not necessary as well? The Judge concludes that the Carrier is not so estopped. Basically, preauthorization is a promise to pay. It is true that a promise that the promisor should reasonably expect to induce action or forbearance of a definite and substantial character on the part of the promisee, and which does induce such action or forbearance, is binding if injustice can be avoided only by the enforcement of the promise. English v. Fischer, 660 S.W.2d 521, 524 (Tex. 1983); Aubrey v. Workman, 384 S.W.2d 389, 393 (Tex.Civ.App.‑‑Fort Worth 1964, writ ref’d n.r.e.). But in this case, the Carrier preauthorized weeks seven and eight only after the Provider had already furnished the first six weeks of work hardening. Obviously then, the Provider was not induced to provide the earlier work hardening by the subsequent preauthorization of additional work hardening.

That leaves the medical necessity dispute. The Carrier clearly showed, through the testimony of Dr. Zvi Kalisky, a renowned expert in rehabilitation medicine, and documentary evidence that the Claimant, at most, needed occupational therapy on her compensable injured hand. No evidence even suggested that she needed intensive, multi-discipline work hardening, including cardiovascular conditioning and psychological counseling. Moreover, the work hardening did not improve the function of her compensable injured right hand.

For these reasons, the ALJ is denying the Provider’s request for reimbursement.

II. FINDINGS OF FACT

1. The Claimant sustained a work-related injury to her right hand on_______, while her employer was________ and the Carrier was its workers’ compensation insurance carrier.
2. Her work duties were to clean and assemble electronic parts with her hands.
3. The Provider prescribed six weeks of work hardening services for the Claimant and provided those services to her between September 18, 2001, and October 27, 2001.
4. Work hardening programs are interdisciplinary in nature with a capability of addressing the functional, physical, behavioral, and vocational needs of an injured worker. 28 Tex. Admin. Code §134.201; Medical Fee Guidelines Medicine Ground Rule II. E.
5. The Provider never preauthorized the disputed first six weeks of work hardening services.
6. When the disputed work hardening services were provided, the Claimant, at most, needed focused occupational therapy to her right hand.
7. The work hardening services provided to the Claimant did not include any occupational therapy to the claimant’s right hand.
8. Functional capacity evaluations at the end of six weeks of work hardening and at the end of eight weeks showed no improvement to the Claimant’s injured right hand.
9. There is no evidence that work hardening was necessary to treat the compensable injury to the Claimant’s right hand.
10. The Provider timely sought reimbursement of $12,288 for the disputed first six weeks of work hardening services.
11. The Carrier denied the requested payment, maintaining that those services were not medically necessary to treat the compensable injury.
12. The Provider filed a request for medical dispute resolution with the TWCC on July 2, 2001.
13. On November 7, 2001, the MRD found that the disputed six weeks of work hardening was medically necessary and ordered the Carrier to remit $9,216 to the Provider for those services.
14. On November 12, 2001, the Carrier appealed the MRD’s decision to the State Office of Administrative Hearings (SOAH).
15. Notice of a February 25, 2002, hearing in this case was mailed to the Carrier and the Provider on December 20, 2001.
16. On February 25, 2002, William G. Newchurch, an Administrative Law Judge (ALJ) with SOAH held a hearing on the Carrier’s appeal at the Stephen F. Austin Building, Suite 1100, 1700 North Congress Avenue, Austin, Texas. The Provider and a representative of the Carrier attended that hearing. The TWCC staff had previously indicated that they would not participate in the hearing.

III. CONCLUSIONS OF LAW

1. The State Office of Administrative Hearings has jurisdiction over matters related to the hearing in this proceeding, including the authority to issue a decision and order, pursuant to Tex. Labor Code Ann. §§ 402.073(b) and 413.031(d) and Tex. Gov’t Code Ann. ch. 2003. (Vernon 2001).
2. Adequate and timely notice of the hearing was provided in accordance with TexGov’t. Code Ann. §§ 2001.051 and 2001.052 (Vernon 2001).
3. As the party appealing the MRD’s decision, the Carrier has the burden of proof in this matter pursuant to 28 Tex. Admin. Code §148.21(h).
4. Under Tex. Labor Code § 408.021 (a), an employee who sustains a compensable injury is entitled to all health care reasonably required by the nature of the injury as and when needed.
5. Based on the above Findings of Fact and Conclusions of Law, the work hardening services that the Provider furnished to the Claimant from September 18, 2001, to October 27, 2001, were not medically necessary to treat the Claimant’s compensable injured right hand.
6. Based on the above Findings of Fact and Conclusions of Law, the Provider’s request for reimbursement of $12,288 for the work hardening services provided to the Claimant from September 18, 2001, to October 27, 2001, should be denied.

IV. ORDER

IT IS ORDERED THAT the Provider’s request for reimbursement of $12,288 for the work hardening services provided to the Claimant from September 18, 2001, to October 27, 2001, is denied.

Signed March 19, 2002.

STATE OFFICE OF ADMINISTRATIVE HEARINGS

WILLIAM G. NEWCHURCH
Administrative Law Judge