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At a Glance:
Title:
453-02-2426-m5
Date:
December 6, 2002
Status:
Retrospective Medical Necessity

453-02-2426-m5

December 6, 2002

DECISION AND ORDER

I. SUMMARY

These cases involve claims for reimbursement filed by health care providers, Floyd Hardimon, D.O.,[1] and East Harris County Orthopedic Associates, P.A.,[2] on behalf of Eric Scheffey, M. D., an employee of EHCOA who assisted in the spinal surgery performed on Claimant____ on October 24, 2000. Both providers sought reimbursement through the Texas Workers’ Compensation Commission (Commission) Medical Review Division (MRD) after National American Insurance Company ( Carrier) denied reimbursement. In separate decisions, the MRD found that the providers had substantiated portions of their claims and ordered partial reimbursement in each dispute.[3] Both providers appealed the MRD decisions, seeking full reimbursement. In addition, the Carrier appealed the MRD decisions, arguing that no reimbursement whatsoever should be ordered. Thus, all three parties in these cases have the burden of showing that the MRD decisions were incorrect. Hardimon and EHCOA are designated Petitioners and Cross Respondents and the Carrier is designated as Respondent and Cross Petitioner. Because the factual and legal issues were identical, the cases were consolidated for decision.

For the reasons stated in this decision, the Administrative Law Judge (ALJ) concludes that no reimbursement should be made to either Dr. Hardimon or EHCOA.

II. PROCEDURAL HISTORY

The hearing involving Dr. Hardimon’s claim, Docket No.453-02-2426.M5, was originally convened by ALJ Casarez on August 5, 2002. ALJ Elkins convened the companion case, East Harris County Orthopedic Associates P.A. v. American Insurance Company, Docket. No. 453-02-2427.M5, on August 12, 2002, which involved the assistant surgeon’s claim for the surgical services provided Claimant____. Deborah Cooks, an employee of Dr. Hardimon and EHCOA, appeared on their behalf at each hearing. Attorney Mahon B. Garry appeared on behalf the Carrier. After the separate hearings, the cases were consolidated because they involved the same facts and legal issues, and the Commission’s certified record in both cases was substantially the same. On August 22, 2002, ALJ Casarez issued an order consolidating the cases for purposes of decision.

On September 16, 2002, the record of the hearing was reopened in the consolidated cases to elicit additional evidence, including the policies or procedures of the Commission related to addendum decisions[4] from second opinion doctors and the attendant duties and responsibilities of providers and carriers in such cases. The representatives of the parties from the earlier hearings appeared at the September 16, 2002 hearing. In addition, Yvonne Williams, attorney with the Commission, appeared as a witness from the Commission. She testified about the Commission’s policies related to second opinions and stated that she would submit the pertinent Dispute Resolution Information System (DRIS) Notes relating to the above-referenced cases on September 18, 2002. While Ms. Williams filed nothing on that date, on September 20, 2002, she filed a document entitled Certification of Specified Instrument(s) that incorporated the DRIS Notes. A copy of the certified notes had been sent to the parties on the same date. The ALJ advised the parties of the ALJ’s intent to admit the DRIS Notes into evidence, despite the late filing. The parties were given until September 27, 2002, which to object to the admission of the notes. No objection was filed and the notes were admitted as Commission’s Ex. 1.

On September 27, 2002, Ms. Williams filed a letter clarifying the testimony she had given at the hearing on September 16, 2002. The ALJ issued an order on October 2, 2002, advising the parties of the ALJ’s intent to admit Ms. Williams’ letter into evidence as Commission’s Ex. 2, unless the parties filed an objection by October 10, 2002. On October 3, 2002, Mr. Garry filed a response, on behalf of the Carrier, to the Commission’s Ex. 2. The response did not object to the letter’s admission, but simply sought to clarify the Carrier’s position regarding its right to challenge authorization for surgery because the second opinion process set out in the Commission’s rule had not been followed. The letter was admitted as Commission’s Ex. 2, and the record of the hearing closed on October 10, 2002.

No issues of jurisdiction or notice were raised by the parties in either of the cases. Therefore, those matters are set out in the findings and conclusions without further discussion here.

III. BACKGROUND AND EVIDENCE

____suffered a compensable injury to his back on ________Eric Scheffey, M.D., became Claimant’s treating doctor in 1999, and at some point referred Claimant to Floyd Hardimon, D.O., for evaluation. On July 26, 1999, Dr. Hardimon completed a TWCC-63, recommending spinal surgery (lumbar laminectomy and fusion L4-S1) to relieve Claimant’s back pain, which had begun radiating down both legs. (Harriman C.R. p. 33). Dr. Schaeffer was to assist in the surgery. The Carrier disagreed with the recommendation and requested a second opinion pursuant to Commission rule 133.206. Dr. Hardimon’s TWCC-63 was forwarded to Dr. Graham, for the Carrier, and Dr. Heggeness, for the Claimant. After reviewing the documentation, Dr. Graham and Dr. Heggeness disagreed with the proposed surgery, indicating that more conservative treatment had not yet been undertaken and the exact cause of the pain had not been identified. The second opinion doctors informed the parties and the Commission of their decisions on August 31, and September 14, 1999, respectively. (Hardimon C.R. pp. 31-33). The Commission advised Dr. Hardimon on September 21, 1999, that the proposed surgery was denied.

On April 21, 2000, Dr. Hardimon sent a letter to the second opinion doctors urging them to reconsider their original decisions regarding Claimant’s need for spinal surgery. The letter had “Addendum Request” written on the first page. Presumably, the doctors did not respond to the April letter because Dr. Hardimon sent another letter (Addendum Request) dated July 31, 2000, again asking that their second opinion decision be reconsidered because Claimant had not responded to conservative treatment and had undergone lumbar diskogram with post discogram CT, and the results showed “evidence of positive discography with annular tears and reproduction of his pain at 4-5 and 5-1.” Dr. Hardimon summed up his request by asking that Claimant be placed in line for the addendum process for spine surgery for decompression with fusion at L-4-L5 and L5-S1. (Hardimon C.R. pp. 39-40).

On September 7, and 8, 2000, Dr. Graham and Dr. Heggeness submitted responses to Dr. Hardimon, which appeared to agree with the proposed surgery.[5] The Commission interpreted the brief notes as concurrences with the proposed surgery and on October 18, 2000, sent Dr. Hardimon a letter indicating the surgery had been approved. (Hardimon C.R. p. 43). When the Carrier received a copy of the Commission’s letter, its representative, Chad Williams, quickly filed a Request for Benefit Review Conference (BRC) with the Commission to challenge the Commission’s determination that the second opinion doctors had, in fact, concurred in the surgery. (Hardimon C.R. p. 44). Along with that request, the Carrier also sent a letter to the Commission, Dr. Hardimon, and Dr. Scheffey indicating it was requesting a contested case hearing (CCH) because it was disputing the approval of the surgery.[6]

At the hearing on August 5, 2002, the Carrier offered Requests for Admissions (RFA) that it had sent to Dr. Hardimon on June 27, 2002, and asked that the admissions be deemed true because Dr. Hardimon had not responded to the requests as required by SOAH rule 155.31 or by T.R.C.P. 198. Ms.

Cooks opposed the Carrier’s request stating that she had sent a letter responding to the Carrier’s RFA. The ALJ reserved ruling on the Carrier’s offer until she reviewed the letter that had been sent on behalf of Dr. Hardimon. After the hearing, Ms. Cooks submitted a copy of the July 8, 2002, letter that she had sent to the Carrier’s attorney in response to the RFA. After reviewing the letter, which in effect states that Drs. Hardimon and Scheffey were available for deposition and would answer any questions the Carrier wished to present, the ALJ agrees with the Carrier that Dr. Hardimon failed to properly respond to the requests for admissions. The ALJ notes that Ms. Cooks is experienced in participating in CCH and is quite familiar with the applicable procedural rules. Thus, the ALJ finds that Ms. Cooks knew or should have known that the letter of July 8, 2002, did not satisfy the requirements of the applicable rules. Therefore, the ALJ rules that the propounded admissions are conclusively established as to Dr. Hardimon in this proceeding. The RFAs offered by the Carrier are hereby admitted into evidence.

John D. King, Jr., an insurance adjuster who handled medical dispute resolution and CCH cases for the Carrier, testified that he was quite familiar with the second opinion process set out in Commission rule 133.206; he had handled between six and ten such cases. He stated that surgeons generally refrain from performing a surgery right after they received a letter authorizing the surgery when they know a carrier is challenging the surgery. They hold off because they want to ensure that whatever questions were raised by the carrier will be resolved and there will be no problem getting reimbursed after the surgery is performed. He testified it was unusual to have the surgery performed so soon after the Commission’s letter such as occurred in this case, especially since the doctors knew the Carrier was disputing the authorization. Mr. King read the content of the letter that was sent to Drs. Hardimon and Scheffey relating to the Carrier’s challenge of the Commission’s surgery authorization.

Dr. Hardimon did not refute that he had received the letter. Instead, Ms. Cook steadfastly maintained that the Carrier could not appeal the Commission’s authorization because thetwosecond opinion doctors had concurred as to the need for surgery. She argued that when both doctors concurred in the second opinion process, the Carrier was responsible for the charges, and could not challenge the authorization that had been given.

Yvonne Williams, staff attorney with the Commission, also testified that generally, a surgeon who knows the carrier is opposed to a surgery will hold off on performing the surgery despite their receiving authorization for the surgery from the Commission. She agreed that performing the surgery six days after issuance of the letter by the Commission was unusual. Additionally, she testified that the Carrier had ten days within which to challenge the Commission’s decision that authorized the surgery in this case and that it appeared the Carrier had begun the process of challenging that decision. She stated she would submit DRIS notes later to the ALJ and the parties to show what had been filed in the case and when.

After filing the DRIS notes referred to in her testimony, Ms. Williams sent a letter on September 27, 2002, to the parties and the ALJ, indicating that her testimony concerning the Carrier’s right to challenge the Commission’s decision had to be changed. She explained that in this case, since both second opinion doctors had reconsidered Dr. Hardimon’s proposed surgery and had concurred with it, the Carrier did not have a right to contest the decision. She clarified that if one of the second opinion doctors had not concurred, then the Carrier would have had a right to challenge, but since both had concurred, under the rule in effect at the time, the Carrier did not have a right to question the surgery authorization. (See Commission’s Ex. 2).

The Carrier filed a letter that did not question Ms. Williams’ latest position. However, the Carrier stated its position that the Providers and the second opinion doctors in this case had not followed the requirements of rule §133.206(l), and therefore, no concurrence to the surgery had been obtained. Because the requirements of the rule had not been complied with in this case, the Carrier had a right to challenge the resulting surgery authorization. But the doctors, through their unusually quick action in performing the ill-fated surgery, even though they knew the Carrier had filed a challenge to the surgery authorization, had thwarted their challenge.

Six days after receiving authorization from the Commission and four days after receiving the Carrier’s letter disputing the authorization, Dr. Hardimon and Dr. Scheffey performed the surgery on October 24, 2000. Four days after the surgery, Claimant died due to complications following the surgery.[7]

IV. LEGAL ISSUES, APPLICABLE LAW,AND ANALYSIS

Applicable Law

Prior to June 17, 2001, Section 408.026 of the Texas Workers Compensation Act[8] required that, except in certain situations, a second opinion had to be obtained prior to the performance of spinal surgery. The section further required the Commission to adopt rules implementing the second opinion process. The Commission adopted the rule at 28 Tex. Admin. Code §133.206, which sets out the responsibilities of the various parties (requesting doctors, second opinion doctors, the Carrier, and the Commission) relating to how and when second opinions and results thereof were to be obtained, given and communicated to the parties. Subsection l of 133.206, in effect in 2000, specifically dealt with how the issue of spinal surgery was to be resubmitted by the requesting doctor after a non concurrence second opinion. The subsection provided that

(l) If the injured employee has a change of condition at any time after a nonconcurrence, the treating doctor or surgeon may submit a TWCC-63 to the division and to both the second opinion doctors with documentation indicting the change of condition as defined in subsection (a)(16) of this section. The second opinion doctors will review the documentation for the purpose of evaluating the presence of criteria listed in subsection (a)(16) prior to submission of an addendum report. If in the doctor’s opinion, the documentation does not meet the criteria of subsection (a)(16), the second opinion doctor shall submit a report to the division and the treating doctor or surgeon indicating there is no change in condition. If documentation meets the criteria in subsection (a)(16), the second opinion doctor shall issue an addendum to the original decision and send a copy to the division, the treating doctor, the surgeon, and the carrier with the word “ADDENDUM” clearly indicated on the narrative report. Addendum decisions, reports, records, and payments, and appeal to a CCH [contested case hearing] are governed by all of the provisions of this section. If the addendum second opinions result in carrier liability, any pending appeal shall be dismissed. (Emphasis added).

Change of condition was defined as “a documented worsening of condition, new or updated diagnostic test results and/or the passage of time providing further evidence of the condition, or follow up of treatment recommendations outlined by a second opinion doctor.”

Issues in the case

  1. Did Dr. Hardimon and Dr. Scheffey comply with Commission rule 133.206(l) in obtaining a concurrence for the proposed spinal surgery?
  2. If Dr. Hardimon and Dr. Scheffey did not comply with Commission rule 133.206, did the Carrier have a right to challenge the Commission’s issuance of authorization for the spinal surgery?
  3. (If Dr. Hardimon and Dr. Scheffey performed the surgery with knowledge that the Carrier was challenging the authorization, may the Carrier deny the charges for the surgery based on the doctors’ non compliance with Commission rule 133.206 (l)(1) in obtaining the purported concurrences?

Analysis and Discussion

The ALJ reviewed the Commission’s certified records in each case, as well as the evidence and arguments that were presented by the parties in each case.

Having reviewed the record, the ALJ determined that Dr. Hardimon and Dr. Scheffey did not comply with 133.206(l) in resubmitting their request for reconsideration of the non concurrence to the second opinion doctors. Although the rule states that the requesting doctor may submit another TWCC-63 to the second opinion doctors together with documentation that shows a change in condition, Dr. Hardimon did not file another TWCC-63 when he resubmitted his request for consideration to Drs. Graham and Heggeness. On July 31, 2000, he simply sent the doctors a letter asking that they reconsider their earlier non concurrences. The letter did not include all of the information that was required in the TWCC-63.[9] Specifically, it did not describe the diagnosis with required OCD codes or the procedures that were being proposed, with required CPT codes and descriptions. Indeed, it appears the reason for requiring a new TWCC-63 was that the requesting doctor would be required to specifically describe the patient’s changed diagnosis, if any, and the specific procedures being proposed (which could have changed from those proposed in the original request for second opinion), so that the second opinion doctors could know the patient’s current condition and the specific procedures being proposed to address any current pathologies. In addition to apprizing the second opinion doctors of the specific procedures being proposed for the patient’s current condition, the submission of a new TWCC-63 also serves to clearly identify the specific procedures the Carrier would be required to pay for, if the second opinion doctors concurred in the resubmitted request.

The letter Dr. Hardimon sent to the second opinion doctors did not include the specific diagnosis he had made of Claimant’s latest condition, nor did he specify the specific procedures he proposed to perform. The fact that Dr. Hardimon failed to indicate the specific procedures he proposed to perform in the July 31, 2000, letter was highlighted by the MRD when it found that he had performed procedures that had not been listed in the August 16, 1999, TWCC-63, the only TWCC-63 that had been filed in this case. Thus, Dr. Hardimon did not comply with the requirements of rule 133.206(l) in resubmitting his July 31, 2000, request for reconsideration because he failed to supply all the information required in the TWCC-63.

In addition, when the second opinion doctors reconsidered Dr. Hardimon’s request, they also failed to comply with the requirements of rule 133.206(l). For example, they failed to state in their addendum decisions what the change in condition was that Claimant had experienced. They also failed to identify the specific surgical procedures that they approved that would relieve or cure Claimant’s current condition. In the best light possible, if the second opinion doctors, in fact, concurred to the proposed surgery, they did so only in a general manner. Thus, when the surgery was authorized, neither the Commission nor the Carrier knew the exact pathology that would be addressed by what particular procedures. Rule 133.206 (l) required much more than that, and when the Commission issued authorization for the surgery, it did not enforce the provisions or requirements of the rule.

With regard to the second issue, because Dr. Hardimon did not comply with rule 133.206(l), the Carrier was entitled to challenge the manner in which the purported concurrence was obtained. Some evidence was presented indicating that because both second opinion doctors concurred with the request for reconsideration, the Carrier did not have a right to challenge the Commission’s issuance of authorization for the surgery. However, that argument fails when the language in the rule itself and the requirement of due process are considered. Specifically, the concluding sentence in subsection (l) states

. . . Addendum decisions, reports, records, and payments, and appeal to a CCH are governed by all of the provisions of this section. (Emphasis added).

In addition, subsection (b)(4)(b) of the rule states that

If the carrier liability resulted from a situation described in subparagraph (1)(D)[concurrence by both second opinion doctors] or by (l)(E) [no timely appeal after two second opinions, only one of which is a concurrence], or (l)(F) [final and nonappealable commission order to pay] of this subsection or from concurrence by only one second opinion doctor, the treating doctor or surgeon shall submit a copy of the original TWCC-63 to the division and all second opinion doctors with documentation indicating the continued medical necessity for the type of spinal surgery. The second opinion doctor(s) shall review the documentation, examine the injured employee if indicated , and submit an addendum report in accordance with paragraph (1)(2) and (l)(3) of this section. Addendum decisions, reports, records, and payments, and appeal to a CCH are governed by all the provision of this section. (Emphasis added).

Both sections of the rule set out above, state that addendum decisions are governed by all the provisions of the rule, suggesting that the second opinion doctors had to comply with the specific requirements set out in subsection (l), i.e., that the doctors had to consider whether the documentation supplied by the proposing surgeon met the criteria of (a)(16) to establish Claimant’s changed condition and so indicate in the clearly marked “Addendum” decision. Further, both sections refer to contested case hearings, which certainly suggests, and in fact, subsection (b)(4)(B) clearly states, that contested case hearings are available even when both doctors concur with the proposing doctor. Therefore, while the rule is not completely clear on whether a carrier has a right to challenge approval of surgery when both second opinion doctors have agreed with the proposed surgery, and the Commission interpreted the rule as not allowing a challenge in that instance, the language in the rule lends support to the contention that such a challenge by a Carrier was contemplated in a situation as that presented in this case. If no challenge were permitted, a Carrier would not be allowed to challenge the Commission’s failure to comply with its own rule, and Texas Courts held early on that an agency is required to follow its own rules.[10]

In addition, fundamental requirements of due process require that a party be given the opportunity to challenge an agency’s action that affects its important liberty or property rights. Without a doubt, if the Commission denied the Carrier the opportunity to challenge a decision authorizing surgery, which had resulted from a process that the Carrier disputed (and had clear evidence in support of its allegations) would constitute denial of due process. In fact, the Texas Supreme Court has considered circumstances requiring due process of law and stated as follows:[11]

Due process at a minimum requires notice and an opportunity to be heard at a meaningful time and in a meaningful manner. Mathews v. Eldridge, 424 U.S. 319, 96 S.Ct. 893, 902 (1976), (other citations omitted). What process is due is measured by a flexible standard that depends on the practical requirements of the circumstances. (Mathews, at 334, and other citations, omitted). This flexible standard includes three factors: (1) the private interest that will be affected by the official action; (2) the risk of an erroneous deprivation of such interest through the procedures used, and the probable value, if any, of additional or substitute procedural safeguards; and (3) the government’s interest, including the function involved and the fiscal and administrative burdens that the additional or substitute procedural requirement would entail. Mathews, at 335.

The evidence presented in this case coupled with language in the rule that appears to allow carriers to challenge a decision authorizing surgery, even when both second opinion doctors appear to have concurred,

lead the ALJ to conclude that the Carrier had a right to challenge the Commission’s October 18, 2000, decision to authorize spinal surgery for Claimant. That right was precluded by Dr. Hardimon’s and Scheffey’s rush to perform the surgery. The ALJ concludes that the Carrier should be allowed at this hearing to argue that the purported concurrences were improperly obtained because the requirements of rule 133.206(l) were not met and deny reimbursement on that basis.[12]

The ALJ concludes that the Carrier met its burden of proof and should not be required to reimburse Dr. Hardimon or Dr. Scheffey.

V. FINDINGS OF FACT

Findings as to Docket Nos. 453-02-2426.M5 and 453-02-2427.M5

  1. Claimant _____suffered a compensable injury to his back on __________At the time of the injury, Claimant was employed by______ , which had its workers’ compensation insurance coverage through National American Insurance Company (Carrier).
  2. Eric Scheffey, M.D., became Claimant’s treating physician in 1999.
  3. Sometime in 1999, Dr. Scheffey referred Claimant to Floyd Hardimon, D.O., for evaluation.
  4. On July 26, 1999, Dr. Hardimon completed a TWCC-63, recommending that Claimant undergo spinal surgery to relieve his back and leg pain.
  5. Dr. Hardimon proposed to perform a lumbar laminectomy and fusion at L4-S1, with Dr. Scheffey assisting.
  6. The Carrier disagreed with the recommendation and requested a second opinion.
  7. Dr. Hardimon’s surgery recommendation was forwarded to Dr. James Graham, the doctor selected by the Carrier, and to Dr. Michael Heggeness, selected by the Claimant.
  8. On August 31, and September 14, 1999, Dr. Graham and Dr. Heggeness responded that they did not agree with the recommended surgery because other more conservative procedures had not yet been undertaken and the exact source of the pain had not been identified.
  9. On September 21, 1999, the Commission informed Dr. Hardimon that authorization for the proposed surgery was denied.
  10. Commission rule 133.206(l) provides that in order to request reconsideration of a previous second opinion, the proposing doctor should complete a new TWCC-63 and indicate the change in Claimant’s condition that warranted the second opinion doctors reconsidering their original decisions.
  11. A change in condition was defined in the rule as “a documented worsening of condition, new or updated diagnostic test results and/or the passage of time providing further evidence of the condition, or follow up of treatment recommendations outlined by a second opinion doctor.”
  12. Entries Nos. 33 and 34 on the TWCC-63 relate to the specific diagnosis (with OCD codes and description) that had been made of Claimant’s condition and the specific procedures (including CPT codes) that were proposed by the surgeon to address the diagnosis.
  13. On April 21, 2000, Dr. Hardimon, sent a letter labeled “Addendum Request” to Drs. Graham and Heggeness, asking that they reconsider their earlier opinion concerning Claimant’s need for spinal surgery.
  14. Neither Dr. Graham nor Dr. Heggeness responded to the April 21, 2000, letter.
  15. On July 26, 2000, Dr. Hardimon sent another letter, with no designation that it was an Addendum Request, to Drs. Graham and Heggeness, asking that they reconsider their earlier opinion relating to Claimant’s spinal surgery.
  16. Dr. Hardimon did not submit a new TWCC-63 together with his request for an addendum decision from the second opinion doctors.
  17. Dr. Hardimon did not specify in his July 26, 2000, letter what exact diagnosis he sought to address by the proposed surgery, nor the exact surgical procedures, with CPT codes, that were being proposed.
  18. On September 7, 2000, Dr. Graham re-evaluated Claimant to determine if he should have the surgery proposed by Dr. Hardimon. Dr. Graham indicated he concurred with the surgery.
  19. Dr. Graham did not specify what Claimant’s changed condition was, what exact diagnosis would be treated by the spine surgery, or what specific procedures were being proposed by the treating surgeon.
  20. Dr. Graham strongly advised Claimant to consult with his primary care physician for a complete medical evaluation to ensure that he did not have any non-spinal problems contributing to his current symptoms, and to discuss with his treating physician the proposed surgical procedure, the potential risks of surgery, the potential benefits of surgery, and the alternatives of treatment.
  21. On September 8, 2000, Dr. Heggeness re-evaluated Claimant to determine if he should have the surgery proposed by Dr. Hardimon. Without setting out details, he concluded that Claimant had met the changed condition criteria.
  22. Dr. Heggeness indicated the procedure being considered was an instrumented fusion from L4 to the sacrum with concurrent decompression, but indicated that specific procedure could be substituted by another procedure, depending on surgeon/patient preference.
  23. On October 18, 2000, after receiving the reports from Drs. Graham and Heggeness, the Commission sent Dr. Hardimon, Dr. Scheffey, and the Carrier a letter that authorized the proposed surgery.
  24. On October 20, 2000, after receiving the Commission’s letter, the Carrier filed with the Commission a request for benefit review conference (BFC) as the first step in challenging the Commission’s determination that spinal surgery for Claimant should be authorized.
  25. The Carrier sent Dr. Hardimon a copy of the BFC request, together with a letter setting out its contention that the surgery authorization was not proper because the second opinion process had not been followed as required in Commission rule 133.206.
  26. Dr. Hardimon received the BFC request form and letter described in Finding No. 26, and knew that the Carrier was challenging the Commission’s determination that surgery should be authorized.
  27. On October 24, 2000, Dr. Hardimon and Dr. Scheffey performed spinal surgery on Claimant.
  28. On October 28, 2000, Claimant died as a result of complications following the surgery.
  29. On November 22, 2000, Dr. Hardimon submitted his claim to the Carrier for reimbursement for the surgery performed on Claimant.
  30. Dr. Hardimon submitted his claim again to the Carrier for reimbursement for the surgery in December 2000, February 2001 and in March 2001.
  31. The Carrier denied the original claim and the subsequent requests for reconsideration, indicating that Dr. Hardimon was not entitled to reimbursement because the surgery had not been properly authorized according to the second opinion process.
  32. On July 24, 2001, Dr. Hardimon requested medical dispute resolution before the Commission’s medical review division (MRD).
  33. The MRD sent a copy of the request to the Carrier and asked for the Carrier’s position on the requested claim. The Carrier’s response was not timely filed and the MRD considered only the provider’s documentation, which included the Carrier’s explanations of benefits (EOBs).
  34. The Carrier consistently denied reimbursement to Dr. Hardimon, indicating he was not entitled to payment because he had not filed a TWCC-63 and had not obtained proper concurrences to support authorization for the surgery.
  35. On February 15, 2001, the MRD considered Dr. Hardimon’s claim and ordered partial reimbursement of$ 6,464 out of the $20,233 that was claimed.
  36. On February 25, 2001, Dr. Hardimon appealed the MRD’s decision, seeking reimbursement of the entire claim.
  37. On March 4, 2001, the Carrier appealed the MRD’s decision, seeking to set aside the order requiring reimbursement of any portion of the claim.
  38. On April 5, 2002, the Commission sent notice of hearing to the parties. The notice contained a statement of the time and place of the hearing, a statement of the legal authority and jurisdiction under which the hearing was to be held, a reference to the particular section of the statues and rules involved, and a short, plain statement of the matters asserted.
  39. A hearing was convened in Docket No. 453-02-2426.M5 by Administrative Law Judge (ALJ) Ruth Casarez on August 5, 2002. Deborah Cooks, employed by Dr. Hardimon, appeared by telephone and represented Dr. Hardimon. Attorney Mahon B. Garry represented the Carrier. The Commission did not appear at that hearing.
  40. On August 22, 2002, companion case Docket No.453-2427.M5 was consolidated with Docket No. 453-2426.M5 for purposes of decision. Because it became clear that additional evidence was required, ALJ Casarez reopened the record of the consolidated cases and requested a Commission representative appear at the scheduled hearing to supply needed information related to Commission policies and procedures on the second opinion process.
  41. The evidentiary record was reopened, and a hearing in the consolidated cases was held on September 16, 2002. Ms. Cooks appeared by telephone on behalf of Dr. Hardimon and East Harris County Orthopedic Associates, P.A., and Mr. Garry appeared on behalf of the Carrier. The parties were given until September 27, 2002 to file their closing arguments.
  42. On September 27, 2002, the Commission’s witness filed a letter (Com. Ex. 2), changing the testimony she had given at the hearing. By order dated October 2, 2002, the parties were given until October 10, 2002, by which to file objections or responses to the admission of Commission’s Exhibit 2. The record of the hearing in the consolidated cases closed on October 10, 2002.

Findings specific to Docket No. 453-02-2427.M5

  1. On November 22, 2000, East Harris County Orthopedic Associates, P.A. (EHCOA) submitted Dr. Scheffey’s claim for surgical services provided to Claimant on October 24, 2000, to the Carrier for reimbursement.
  2. EHCOA submitted Dr. Scheffey’s claim for reimbursement for the surgery to the Carrier again in December 2000, February 2001 and in March 2001.
  3. The Carrier denied the original claim and the subsequent requests for reconsideration, indicating that Dr. Scheffey was not entitled to reimbursement because the surgery had not been properly authorized according to the second opinion process.
  4. On July 24, 2001, on behalf of Dr. Scheffey, EHCOA requested medical dispute resolution before the Commission’s medical review division (MRD).
  5. The MRD sent a copy of the request to the Carrier and asked for the Carrier’s position on the requested claim. The Carrier’s response was not timely filed and the MRD considered only the provider’s documentation, which included the Carrier’s explanations of benefits (EOBs).
  6. The Carrier consistently denied reimbursement to Dr. Hardimon, indicating he was not entitled to payment because he had not filed a TWCC-63 and had not obtained proper concurrences to support authorization for the surgery.
  7. On February 15, 2001, the MRD considered Dr. Scheffey’s claim and ordered partial reimbursement of$ 2,028.50 out of the $ 5,350 that was claimed.
  8. On February 25, 2001, on behalf of Dr. Scheffey, EHCOA appealed the MRD’s decision, seeking reimbursement of the entire claim.
  9. On March 4, 2001, the Carrier appealed the MRD’s decision, seeking to set aside the order requiring reimbursement of any portion of the claim.
  10. On April 5, 2002, the Commission sent notice of hearing to the parties. The notice contained a statement of the time and place of the hearing, a statement of the legal authority and jurisdiction under which the hearing was to be held, a reference to the particular section of the statues and rules involved, and a short, plain statement of the matters asserted.
  11. A hearing was convened Docket No. 453-02-2427.M5 by ALJ Gary Elkins on August 12, 2002. Deborah Cooks, employed by East Harris County Orthopedic Associates, P.A., appeared by telephone and represented East Harris County Orthopedic Associates, P.A. Attorney Mahon B. Garry represented the Carrier. The Commission did not appear at that hearing.
  12. On August 22, 2002, companion case Docket No.453-2426.M5 was consolidated with Docket No. 453-2427.M5 for purposes of decision. Because it became clear that additional evidence was required, ALJ Casarez reopened the record of the consolidated cases and requested a Commission representative appear at the scheduled hearing to supply needed information related to Commission policies and procedures on the second opinion process.
  13. The evidentiary record was reopened, and a hearing in the consolidated cases was held on September 16, 2002. Ms. Cooks appeared by telephone on behalf of Dr. Hardimon and East Harris County Orthopedic Associates, P.A., and Mr. Garry appeared on behalf of the Carrier. The parties were given until September 27, 2002 to file their closing arguments.
  14. On September 27, 2002, the Commission’s witness filed a letter (Com. Ex. 2), changing the testimony she had given at the hearing. By order dated October 2, 2002, the parties were given until October 10, 2002, by which to file objections or responses to the admission of Commission’s Exhibit 2. The record of the hearing in the consolidated cases closed on October 10, 2002.

VI. CONCLUSIONS OF LAW

  1. The Texas Workers’ Compensation Commission (Commission) has jurisdiction to decide the issues presented pursuant to the Texas Workers’ Compensation Act (the Act), Tex. Lab.Code Ann. §413.031.
  2. The State Office of Administrative Hearings (SOAH) has jurisdiction over matters related to the hearings in these proceedings, including the authority to issue a decision and order, pursuant to 413.031(d) of the Act; Tex. Gov't Code Ann. ch. 2003, and 28 Tex. Admin. Code (TAC) chs. 148 and 149.
  3. Pursuant to§413.031 of the Act and 28 TAC §148.3, Dr. Hardimon and East Harris County Orthopedic Associates, P. A., Petitioners and Cross Respondents in SOAH Docket Nos. 453-02-2426.M5 and 453-02-2427.M5 timely appealed the MRD’s decisions that denied full reimbursement for their respective claims.
  4. Pursuant to§413.031 of the Act and 28 TAC §148.3, National American Insurance Company, Respondent and Cross Petitioner timely appealed the MRD’s decisions that granted partial reimbursement for Dr. Hardimon’s claim.
  5. The notice of hearing sent by the Commission to the parties in the referenced dockets complied with the requirements of Tex. Gov’t Code §§2001.051 and .052 and of 28 TAC §148.4(b).
  6. Pursuant to §413.031 of the Act and 28 TAC §148.21(h) and (i), Dr. Hardimon, East Harris County Orthopedic Associates, P.A., and the Carrier had the burden of showing by a preponderance of the evidence that the MRD’s decision was incorrect and should be changed to reflect their respective theories of the case.
  7. Because Dr. Hardimon and East Harris County Orthopedic Associates, P.A., did not prove that the surgical procedures performed on Claimant and billed to the Carrier were specified in Dr. Hardimon’s request for an addendum decision and were concurred in by the second opinion doctors as required in Commission rule 133.206(l), Dr. Hardimon and East Harris County Orthopedic Associates, P.A. did not meet their burden to establish that they should be paid for the medical services they provided to Claimant.
  8. The Carrier proved that Dr. Hardimon did not comply with the requirements of Commission rule §133.206(l) in obtaining the addendum decision from the second opinion doctors in September 2000.
  9. The Carrier proved the second opinion doctors’ updated opinions (dated September 7, and 8, 2000) did not meet the requirements of addendum decisions as set out in rule §133.206(l).
  10. Therefore, the updated opinions were not concurrences that supported authorization for the recommended surgery.
  11. Because the Carrier proved that Dr. Hardimon did not obtain concurrences from the second opinion doctors in accordance with the requirements of Commission rule 133.206(l), the Carrier is not required to reimburse for the surgery performed by Dr. Hardimon and Dr. Scheffey on Claimant on October 24, 2000.

ORDER

It is hereby ordered that Respondent and Cross Petitioner National American Insurance Company shall not be required to reimburse Floyd Hardimon, D.O. or East Harris County Orthopedic Associates, P.A., for the surgical procedures performed on Claimant on October 24, 2000.

Signed this 6th day of December 2002.

RUTH CASAREZ
Administrative Law Judge
STATE OFFICE OF ADMINISTRATIVE HEARINGS

  1. SOAH Docket No. 453-02-2426.M5 [hereinafter, Dr. Hardimon’s claim].
  2. SOAH Docket No. 453-02-2427.M5 [hereinafter, the EHCOA or Dr. Scheffey’s claim].
  3. See MRD’s Medical Dispute Resolution Findings and Decision in MRD Tracking Nos. M5-01-2470-01 (Hardimon), dated February 15, 2002, and M5-01-2417-01 (EHCOA), dated February 15, 2002. As to Tracking Nos. M5-01-2470-01(SOAHDocket No. 453-02-2426.M5) - the MRD ruled (pp. 3-4) that the Carrier should reimburse Hardimon $ 6,464 of the $20,233 billed. The MRD stated that the documentation supported $ 3,540 reimbursement for laminectomy and fusion, CPT Code 63047 - L2, although miscoded (should have been 63042-lumbar laminectomy); $1,650 for work on a herniated disc, CPT Code 22630 - L3, although that level was not included in the TWCC-63; and $1,274 for fusion of L4 (2) under CPT Code 22650 - L4 (2). The MRD did not allow the claim for additional levels using CPT Code 22630-51 L4 (2), but rather allowed it under CPT Code 22650 - L4 (2). It also disallowed reimbursement for fusion of L3 under CPT Code 22625 because it was not included in the TWCC-63 and further the procedure was reimbursed above, and for CPT Codes 22842, 20902, and 20975 because the procedures were not listed on the TWCC-63 and the operative report did not support that emergent care was required. As to M5-01-2417-01 (SOAHDocket No. 453-02-2427.M5) - The MRD ruled (pp. 3-4) that the Carrier should reimburse EHCOA $ 2,028.50 of the $5,350 billed. The MRD stated that the documentation supported $ 3,540 x 25% for $885 reimbursement for laminectomy and fusion, CPT Code 63047-80 L2, although miscoded (should have been 63042-80); $825 for work on a herniated disc, CPT Code 22630-80 L3, although that level was not included in the TWCC-63, it was supported in the operative report; $318 ($159 x 2) for fusion of L4 (2), additional levels under CPT Code 22650-80 L4 (2). The MRD did not allow the claim for additional levels using CPT Code 22630B51 L4 (2), but rather allowed it under CPT Code 22650- 80 L4 (2). It also disallowed reimbursement for fusion of L3 under CPT Code 22625-80 because it was not included in the TWCC-63 and further the procedure was reimbursed above, and for CPT Codes 22842-80, 20902-80, and 20975-80 because the procedures were not listed on the TWCC-63 and the operative report did not support that emergent care was required that would not have been known prior to the operation.
  4. An addendum decision is an opinion from a second opinion doctor who has reconsidered his original opinion in the second opinion process. In effect, an “addendum decision” is a reconsidered, second opinion by a second opinion doctor. According to Commission rule 133.206(l), a doctor who originally disagreed with a proposed surgery may change his opinion, if he finds certain factors as set out in the rule, i.e. a change of condition, warrant a change.
  5. The doctors’responses were very brief notes that indicated they concurred with the proposed surgery. However, the doctors did not specify what change of condition had been shown by Dr. Hardimon, nor the specific procedures they were approving. Dr. Graham wrote that Claimant’s pain sources had been identified as L3-L4, L4-L5 and L5-S1, and then proceeded to advise Claimant during the examination with words of caution, and perhaps reservation, as reflected in his written notation: “that he will probably will (sic) not get complete pain relief from the operation. He was strongly advised to consult with his primary care physician for a complete medical evaluation to make sure that he does not have any non-spinal problems contributing to his current symptoms. He was also strongly advised to consult with his treating physician to discuss the proposed surgical procedure, the potential risks of surgery, the potential benefits of surgery, and the alternatives of treatment.” Dr. Graham’s unsigned note did not indicate it was an addendum report. (Hardimon C.R. p. 41). Dr. Heggeness’ signed note was titled “TWCC-Addendum For Second Surgical Opinion.” As to changed condition, Dr. Heggeness wrote that Claimant had continued with conservative care and had had an EMG, interpreted as showing a L5 nerve root irritation bilaterally and that discography had shown positive concordant pain responses at L3-L4, L4-L5, and L5-S1. It further stated that the procedure being considered was “an instrumented fusion from L4 to the sacrum with concurrent decompression.” Apparently, Claimant expressed reservations about having instrumentation’ performed, and Dr. Heggeness explained that the procedure could be done with or without instrumentation, depending on surgeon/patient preference and that this could be an issue to discuss with his surgeon. (Hardimon C.R. p. 42)
  6. A copy of the Carrier’s letter was not introduced into evidence, but Mr. King read the letter into the record at the hearing on September 16, 2002.
  7. See Autopsy of E.B. (Hardimon C.R. pp. 47-50) which indicates that blood clots were found in the major pulmonary trunk and in the left pulmonary artery; the left atrium of the heart also was filled with organized blood clots. It appears that E.B. also had advanced coronary arteriorsclerosis, hardening or narrowing of the arteries, which restricted blood flow. E.B.’s heart showed evidence of past arterial blockage.
  8. Section 408.026 was amended in 2001, as were Commission rules 133.206 and 134.600 (effective date of rule amendment was January 1, 2002). Current rule 134.600(h)(3) requires a provider to seek preauthorization for non-emergency spinal surgery as provided by Section 408.026 of the Act. However, because the surgery involved here occurred in 2000, the statutory and rule provisions in effect at that time apply in this case. A complete copy of rule 133.206, in effect at the time, is attached as Addendum A.
  9. In addition to general Claimant, Carrier and Doctor information required to be filled out on the TWCC-63, were sections requiring specific information, such as Item 33, diagnosis and ICD and description, and Item 34, a listing of the specific recommended procedures, including CPT Codes and descriptions. (See Hardimon C.R. p.10).
  10. SeeGulf Land Co. v. Atlantic Richfield Co., 131 S.W.2d 73 (Tex. 1939).
  11. See University of Texas Med. School v. Than, 901 S.W.2d 926, 930 (Tex. 1995).
  12. Id. at 934, for proposition that a party denied due process should be accorded due process with a hearing that allows the party to present his position.
End of Document
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