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DECISION AND ORDER

Injured worker________[1] (Claimant) has appealed a decision of the Medical Review Division (MRD) of the Texas Workers= Compensation Commission (the Commission) denying reimbursement of $323.00 she paid for immunotherapy and intradermal skin tests provided to her from June 15, 2001, through September 7, 2001, by her treating physician. The MRD's denial of payment was based on its review of a decision made by an independent review organization (IRO) physician who found the disputed treatment was not medically necessary to treat Claimant's compensable injury. As set out below, the Administrative Law Judge (ALJ) finds Claimant did not substantiate the medical necessity of the disputed treatment and is not entitled to reimbursement.

I. NOTICE, JURISDICTION AND VENUE

There were no contested issues regarding notice, jurisdiction or venue. Therefore, those matters are addressed in the Findings of Fact and Conclusions of Law without further discussion here.

II. STATEMENT OF THE CASE

ALJ Sharon Cloninger convened the hearing in this matter on July 24, 2003, at the State Office of Administrative Hearings (SOAH) in the William P. Clements Building, 300 West 15th Street, Fourth Floor, Austin, Texas. Claimant represented herself with assistance from Barton Levy, an ombudsman provided by the Commission at Claimant's request. Facility Insurance Company (Carrier) was represented by Steve Tipton, attorney. The hearing adjourned and the record closed that same day.

The issue before the ALJ is whether the immunotherapy and intradermal skin tests in question were medically necessary to treat Claimant's compensable injury.

III. EVIDENCE PRESENTED

Claimant testified on her own behalf and called William Rea, M.D.,[2] her treating physician, to testify by telephone. Edward Peters, M.D., testified on behalf of Carrier. Petitioner offered two exhibits, which were admitted. Carrier offered 18 exhibits, which were admitted.

A. Background

On________, Claimant was a third-grade teacher in the ____ Independent School District when she sustained a compensable injury from handling methanol[3] and inhaling methanol fumes contained in duplicating fluid. Within 24 hours of the exposure, Claimant developed circular headaches, nausea, a vomiting sensation, chest tightness and a sensation of wheezing in her throat. She returned to work briefly, but has not worked since February 28, 1992. Her symptoms recur when she is around paint fumes and other odors. (Carrier's Ex. 10).

In 1993, after being treated by a series of doctors, Claimant was referred to Dr. Rea at the Environmental Health Center in Dallas. He diagnosed her to have multiple chemical sensitivities. From June 15, 2001, through September 7, 2001, he provided her with eight immunotherapy treatments and two intradermal skin tests. She states the immunotherapy and testing are prescribed by Dr. Rea to control the headaches and seizure disorder caused by the brain injury she sustained from the methanol exposure. She states skin testing is required to determine the correct dosage for immunotherapy. (Pet. Ex. 1).[4]

B. Medical Necessity of Treatment

Claimant

Claimant said she has been treated for her compensable injury by approximately seven doctors, who all found her symptoms to be the result of her exposure to methanol. She said Stevan Cordas, D.O., a doctor designated by the Commission, found her to have a 25 percent impairment based on his independent neuropsychological testing and her reported seizure activity. She said she continues to suffer from debilitating headaches, which can be triggered by exposure to molds, chemicals and grasses, and which are relieved by immunotherapy. She said that when she does not have immunotherapy treatment, she is in bed for days with headaches.

Dr. Rea

Dr. Rea said diagnostic studies conducted on Claimant through the years indicate her to have neurotoxicity, which he continues to treat by having her avoid exposure to toxic substances such as car exhaust, copying machines, and pesticides; by using heat therapy to cause her to sweat out toxic substances in her system; and by using nutrition. He said he also uses neutralization injections, which he said are similar to allergy shots, to neutralize the effects of toxic substances on her system.

Dr. Peters

Dr. Peters is Board Certified in Internal Medicine, Pulmonary/Critical Care Medicine, and Allergy/Immunology. He testified that Claimant's current condition and symptoms are not related to the methanol exposure itself, because the effects of inhaling methanol fumes and handling methanol do not last for years. He said his opinion is based partly on the fact that a week before the hearing, he searched the National Institutes of Health website which cross-references thousands of articles, and could find nothing regarding the long-term effects of methanol exposure. He said there is nothing in the literature to support that methanol exposure causes an immuno response.

He allowed that Claimant's symptoms are real, but said they could not be the result of the methanol exposure. He said the use of neutralization injections is not supported by any peer review studies, and is outside the standard of care. He said the diagnosis of multiple chemical sensitivity is not a recognized diagnosis. He said Claimant needs to be seen and cared for by a doctor who will do something within the standard of care to treat her condition. He said that while allergists and immunologists use injections all the time, Dr. Rea's doses and the frequency of those doses administered to Claimant are not consistent with accepted medical care. Dr. Peters agrees with position statements included in Carrier's exhibits 1-18 that the treatments Dr. Rea is using for Claimant are not effective.

Dr. Peters agrees with Thomas Kurt, M.D.[5], who examined Claimant on July 27, 1992, and found that because methanol is not capable of producing a continued toxic health effect, Claimant suffers from odor-triggered panic attack symptoms, initially associated with her methanol exposure. (Carrier's Ex. 10).

Documentary evidence

Dr. Cordas examined Claimant at the Commission's request and reported on June 17, 1994, that his findings agree with those of neuropsychologists that Claimant suffers from residual neurologic dysfunction that persists and apparently did not predate her compensable injury. He said the dysfunction is independent of the multiple chemical sensitivity, which is not compensable. (Petitioner's Ex. 1).

According to a December 1992 report that appeared in JAMA (Journal of the American Medical Association), there are no accurate, reproducible, well-controlled studies that support the contention that Multiple Chemical Sensitivity Syndrome is a significant disease or that the diagnostic tests and the treatments used have any therapeutic value. (Carrier's Ex. 3).

The American Academy of Allergy and Immunology has concluded there is no clear evidence for a cause-and-effect relationship between symptoms and environmental exposure, and thus no evidence to support the use of a multiple chemical sensitivity as a diagnostic entity. (Carrier's Ex. 8).

Dr. Peters' peer review report dated September 27, 2000, states that in patients who have chronic methanol intoxication, abnormalities on CT scan and MRI have been reported. He notes that Claimant's MRI was normal on November 8, 1993, and her CT scan was normal on October 24, 1995, leading him to conclude there is no substantive evidence that links the occupational exposure to methanol to Claimant's chronic medical complaints.

In a January 11, 2001 letter responding to a peer review, Dr. Rea explains that Claimant was frequently complaining of severe headaches as a result of her chronic sinusitis. It is for this reason that we started her on skin testing to determine her specific sensitivities and to undergo antigen neutralization shots to build up immune tolerance and consequently reduce symptoms. The patient was extremely sensitive to a number of foods and inhalants which were the reasons we had to have her undergo extensive skin testing for full coverage. The patient was asymptomatic as long as she was on neutralization shots. (Petitioner's Ex. 1).

C. Closing arguments

Claimant's argument

Claimant argued that her compensable injury is neurotoxicity, a diagnosis with which the Commission's designated doctor concurred. Claimant is seeking reimbursement for the immunotherapy and intradermal tests because the disputed treatments give her relief from headaches.

Carrier's argument

There is no scientific evidence supporting Dr. Rea's position that the immunotherapy and intradermal skin tests are medically necessary to treat Claimant's condition. There is nothing in the literature to support that immunotherapy cures headaches. Claimant's EEG is normal and her MRI is normal. There is no explanation regarding how her toxic profiles are related to her methanol exposure.

IV. LEGAL STANDARDS

Section 408.021 of Texas Labor Code Ann. provides as follows:

(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. The employee is specifically entitled to health care that:

  1. cures or relieves the effects naturally resulting from the compensable injury;
  2. promotes recovery; or
  3. enhances the ability of the employee to return to or retain employment.

. . .

V. DISCUSSION AND ORDER

Claimant did not prove the disputed treatments are medically necessary to treat her compensable injury, which according to the Commission's designated doctor is residual neurologic dysfunction. Dr. Rea states in his January 11, 2000 letter that he is using the immunotherapy and skin tests to treat Claimant's headaches resulting from her chronic sinusitis. There is no evidence that Claimant's exposure to methanol caused her to have chronic sinusitis resulting in headaches. Since the disputed treatment is for headaches unrelated to Claimant's compensable injury, there is no medical necessity for the treatment pursuant to Tex. Labor Code Ann. ' 408.021. Even if the immunotherapy and intradermal skin tests relieve Claimant's headaches, as she testified, the treatment is not reimbursable because it is not medically necessary to treat her compensable injury.

VI. FINDINGS OF FACT

  1. On________,_____ (Claimant) sustained a work-related injury when she inhaled fumes from and handled duplicating fluid containing methanol.
  2. On the date of the injury, Claimant's employer was the _____ Independent School District and its workers' compensation carrier was Facility Insurance Company (Carrier).
  3. Within 24 hours of the contact with the duplicating fluid, Claimant suffered circular headaches, nausea, a vomiting sensation, chest tightness and a wheezing sensation in her throat.
  4. Claimant suffers from residual neurologic dysfunction as a result of her compensable injury.
  5. William Rea, M.D., provided immunotherapy and intradermal skin tests from June 15, 2001 to September 7, 2001, to treat Claimant's headaches associated with her chronic sinusitis.
  6. Claimant paid Dr. Rea $323.00 for the treatment listed in Finding of Fact No. 5.
  7. Claimant sought reimbursement from Carrier for the provided medical services.
  8. Carrier denied reimbursement on the grounds that the disputed treatment was not medically necessary.
  9. An independent review organization (IRO) reviewed the medical dispute and found the treatment was not medically necessary.
  10. On March 13, 2003, after reviewing the IRO decision, the Medical Review Division (MRD) of the Texas Workers= Compensation Commission (the Commission) issued a decision denying reimbursement for the immunotherapy and intradermal skin tests provided June 15, 2001, through September 7, 2001, because the treatment was not found to be medically necessary.
  11. Petitioner filed a timely request for hearing on March 25, 2003.
  12. Notice of the hearing was sent to all parties on April 29, 2003.
  13. The notice contained a statement of the time, place, and nature of the hearing; a statement of the legal authority and jurisdiction under which the hearing was to be held; a reference to the particular sections of the statutes and rules involved; and a short, plain statement of the matters asserted.
  14. Administrative Law Judge (ALJ) Sharon Cloninger convened a hearing in this matter on July 24, 2003, at the State Office of Administrative Hearings (SOAH) in the William P. Clements Building, 300 West 15th, Austin, Texas. Claimant represented herself, with assistance from Barton Levy, an ombudsman provided by the Commission at Claimant's request. Fidelity Insurance Company (Carrier) was represented by Steve Tipton. Following the presentation of evidence, the hearing adjourned and the record closed that same day.
  15. Claimant's chronic sinusitis is not a result of her exposure to methanol.
  16. Immunotherapy and intradermal skin tests are not medically necessary to treat Claimant's compensable injury.

VII.CONCLUSIONS OF LAW

  1. The Texas Workers' Compensation Commission (Commission) has jurisdiction over this matter pursuant to the Texas Workers' Compensation Act (the Act), TEX. LAB. CODE ANN. '413.031.
  2. 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 the Act '413.031(d), TEX. GOV'T CODE ANN. Ch. 2003.
  3. Adequate and timely notice of the hearing was provided to the parties in accordance with Gov't Code 2001.051 and 2001.052.
  4. Petitioner has the burden of proving by a preponderance of the evidence that it should prevail in this matter. 28 Tex. Admin. Code (TAC) ' 148.21(h).
  5. Under the Commission's rules, the IRO's decision has presumptive weight in all appeals from reviews of retrospective medical necessity disputes. 28 TAC ' 133.308(v).
  6. 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. Tex. Lab. Code Ann. ' 408.021(a).
  7. Petitioner has not met her burden of proving the immunotherapy and intradermal skin tests were medically necessary within the meaning of Tex. Lab. CODE ANN. ' 408.021.
  8. Based upon Findings of Fact Nos. 1-6 and 15-16, andConclusion of Law No. 7,Petitioner is not entitled to $323.00 in reimbursement from Carrier for the disputed treatments.

ORDER

Based on the above Findings of Fact and Conclusions of Law, it is ordered that_____ is not entitled to reimbursement from Facility Insurance Company for the disputed treatment.

Signed this 22nd day of March, 2020.

SHARON CLONINGER

Administrative Law Judge
State Office of Administrative Hearings

  1. To protect Claimant's identity, her initials will be used in this Decision and Order.
  2. As a preliminary matter, the parties addressed Carrier's Motion to Strike Dr. Rea's testimony as to the nature and cause of Claimant's alleged injuries, on the grounds that Dr. Rea has no reasonable scientific basis for his opinion. The ALJ ruled that Dr. Rea could not testify as an expert, but could testify as to his diagnosis and treatment of Claimant.
  3. Methanol is a light volatile pungent flammable poisonous liquid alcohol used especially as a solvent, antifreeze, or denaturant for ethyl alcohol and in the synthesis of other chemicals. Called also methyl alcohol, wood alcohol. Merriam-Webster's Medical Dictionary (1995), p. 415.
  4. The pages in Petitioner's Exhibit 1 are not numbered
  5. Dr. Kurt is a Diplomate of the American Board of Medical Toxicology.

DECISION AND ORDER

I. DISCUSSION

Ernie V. Fields, D.C. (Petitioner) requested a hearing to contest the Findings and Decision of the Texas Workers’Compensation Commission (Commission) denying Petitioner reimbursement from South Plains School Worker’s Compensation Program (Respondent) for work conditioning. Petitioner also disputed the decision of the independent review organization (IRO), Envoy Medical Systems, L.P., that the physical performance tests[1] performed April 20, 2004, and June 24, 2004, were not medically necessary

The Administrative Law Judge (ALJ) concludes that Petitioner should be reimbursed for neither the work conditioning program nor the physical performance tests.

I. JURISDICTION, NOTICE, AND PROCEDURAL HISTORY.

The hearing convened on January 4, 2006, before ALJ Stephen J. Pacey. Steven Tipton represented Respondent. Dr. Fields appeared pro se. There were no contested issues of notice or jurisdiction. The hearing adjourned the same day, but the parties were allowed additional time to file documents, and the record closed on January 12, 2006.

II. Discussion

__ (claimant) was injured on___, when she slipped on a heavily waxed floor. On June 30, 2004, Respondent preauthorized a work-conditioning program to be conducted four sessions a week for five weeks. The preauthorization was for treatment of the left hip and shoulder.[2] At a benefit contested case hearing held on November 8, 2004, the hearing officer concluded that there was no causal relationship between the injury of ___and injuries to the left hip or shoulder.[3] The hearing officer stated the compensable injury of___, does not include injury to the left hip and left shoulder.

Respondent denied reimbursement, and Petitioner filed a medical dispute. The Medical Dispute Division (MRD) submitted the question of medical necessity of the physical performance tests to the IRO who concluded that the physical performance tests were not medically necessary. The MRD did not refer the work conditioning to the IRO. In a decision dated February 22, 2005, the MRD decided the work-conditioning dispute. It determined that the work conditioning was preauthorized but denied reimbursement on the basis that reimbursement could not be determined because the Petitioner did not provide HCFAs[4] for review. Petitioner then requested a hearing and attached the HCFAs.

III. ANALYSIS

Petitioner failed to prove that he should be reimbursed for the work conditioning or the physical performance testing. Petitioner relied upon his preauthorization, but the preauthorization was for an injury that was not caused by the accident. There had been a final adjudication that the injury to the left hip and shoulder was not compensable. The rule, 28 Tex. Admin. Code (TAC) § 134.600(c) states in pertinent part:

(c) The carrier is not liable under subparagraphs (b)(1)(B) or (C) of this section if there has been a final adjudication that the injury is not compensable or that the health care was provided for a condition unrelated to the compensable injury.

The fact that the Respondent’s preauthorization did not consider compensability is appropriate by rule. 28 TAC § 134.600(f) prohibits the Carrier from considering anything but medically necessity when making a determination on preauthorization. The rule states inpertinentpart:

(f) The carrier shall:

(1) approve or deny requests for preauthorization or concurrent review based solely upon the reasonable and necessary medical health care required to treat the injury, regardless of:

(A) unresolved issues of compensability, extent of or relatedness to the compensable injury;

The MRD made the right decision in denying reimbursement for the work-conditioning program but for the wrong reason. The MRD ignored the Commission’s own order in a contested case hearing where the hearing examiner specifically held that the hip and shoulder were not compensable. The preauthorization was for the hip and shoulder. Under the rules, Petitioner cannot be reimbursed for a injury that is not compensable. It is axiomatic that testing for an injury that is not compensable is not medically necessary. Consequently, Petitioner failed to prove that he should be paid for the tests that the IRO held were not medically necessary.

III. FINDINGS OF FACT

  1. On February 11, 2005, an independent review organization (IRO), Envoy Medical Systems, LLC, determined that the physical performance tests administered by South Plains School Workers’ Comp Program (Petitioner) to __(Claimant) were not medically necessary.
  2. On June 30, 2004, South Plains School Workers’ Comp Program (Respondent) preauthorized a work conditioning program for treatment of the left hip and shoulder to be conducted four sessions a week for five weeks.
  3. On February 22, 2005, the Medical Review Division (MRD) found that reimbursement could not be determined because Petitioner did not provide HCFAs for review.
  4. On March 11, 2005, Petitioner contested the Commission and IRO decisions.
  5. At a Commission benefit contested case hearing held on November 8, 2004, the hearing officer concluded that there was no causal relationship between the injury of March 16, 2004 and injuries to the left hip or shoulder and that the compensable injury did not include injury to the left hip and shoulder.
  6. Respondent denied reimbursement to treatments for work conditioning and the physical performance testing on the basis that the injuries were not compensable.
  7. The physical performance testing was not reimbursable because they were performed to determine the extent of an injury that was not compensable.
  8. Neither the work conditioning nor the physical performance testing were reimbursable on the basis of a final adjudication that the injury was not compensable.
  9. The Commission issued a notice of hearing on April 4, 2005, that included the date, time, and location of the hearing, the applicable states under which the hearing would be conducted, and a short, plain statement of matters asserted.
  10. A hearing was convened by Administrative Law Judge Stephen J. Pacey on January 4, 2006, in the hearing rooms of the State Office of Administrative Hearings. The hearing adjourned that same day, and after the Respondent submitted additional documents, the record closed on January 12, 2006.

IV. CONCLUSIONS OF LAW

  1. The Texas Workers’ Compensation Commission has jurisdiction to decide the issue presented pursuant to the Texas Workers’ Compensation Act, Tex. Lab. Code Ann. § 413.031.
  2. 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. Lab. Code Ann. § 413.031(k) and Tex. Gov’T. Code Ann. ch. 2003.
  3. Petitioner timely requested a hearing in this matter pursuant to 28 Tex. Admin. Code (TAC) §§ 102.7 and 148.3.
  4. Notice of the hearing was proper and complied with the requirements of Tex. Gov’T. Code Ann. ch. 2001.
  5. Petitioner’s treatments and testing were not medically necessary on the basis that the injury was not compensable.
  6. Petitioner had the burden of proof in this matter, which was the preponderance of evidence standard. 28 TAC §§ 148.21(h) and (i); 1 TAC §155.41(b).
  7. Based upon the Findings of Fact and Conclusions of Law, Respondent proved by a preponderance of the evidence that Respondent’ denial of reimbursement to Petitioner for work conditioning and physical performance testing was proper because the treatments were performed on an injury that was not compensable.

ORDER

THEREFOREIT IS ORDERED that South Plains School Workers’ Comp Program is not required to reimburse Ernie V. Fields, D.C., for either the work conditioning or physical performance testing.

Signed March 9, 2006.

STEPHEN J. PACEY

ADMINISTRATIVE LAW JUDGE
STATE OFFICE OF ADMINISTRATIVE HEARINGS

  1. CPT Code 97750.
  2. Petitioner’s Exhibit 1.
  3. Respondent’s Exhibit 1 at page 30.
  4. Health Care Financing Administration. This are the forms Providers utilize for billing.

DECISION AND ORDER

This case is a dispute over whether National Union Fire Insurance Company of Pittsburgh Pa. (Carrier) should pay a claim filed by Back & Joint Clinic (Clinic) for services performed on an injured worker (Claimant) from June 19, 1999, through February 2, 2000. The Texas Workers’ Compensation Commission (Commission) Medical Review Division (MRD) ordered the Carrier to pay $7,896.00. This decision concludes that the Carrier should pay for the majority of the disputed services because it pre-authorized the services and is precluded from denying the Clinic’s claim on the ground of medical necessity. Overall, the Carrier should pay $7,280.50.

I. PROCEDURAL HISTORY

Hearings were held in this case on June 18, 2002, August 28, 2002, and March 17, 2003, before James W. Norman, Administrative Law Judge (ALJ), at the State Office of Administrative Hearings (SOAH), 4th Floor, William P. Clements Building, 300 West 15th Street, Austin, Texas. The Carrier was represented by Attorney Steven M. Tipton. Attorney Scott Hilliard represented the Clinic.

After the June 18, 2002, hearing convened, the parties and the ALJ agreed it would be more efficient to try first the threshold issue of whether the Carrier pre-authorized treatment to the Carrier’s lumbar spine. A Commission hearing officer had ruled on January 26, 1999, that the Claimant’s compensable injury was limited to his lumbar spine. The Carrier contended its review agent’s pre-authorization was to the cervical spine only. Both parties said this decision would largely control the case. The Clinic asked to recess the hearing for time to research and prepare testimony specifically on this issue. The Carrier did not object, and the motion was granted.

The hearing reconvened on August 28, 2002. After the presentation of evidence, the Carrier conceded that the evidence did not support its position that its pre-authorization approvals were limited to the cervical spine and agreed that a lack of pre-authorization is not an issue in this case. However, the Carrier still asserted that SOAH has no jurisdiction to order medical benefit payments in cases where it has yet to be determined that the medical treatment was for the compensable injury. The Carrier contended compensability issues are exclusively within the Commission’s jurisdiction to determine.[1] The parties submitted extensive briefing on this issue. In an order dated December 6, 2002, the ALJ ruled that SOAH does have jurisdiction to consider the matters appealed given the facts that: the Carrier invoked SOAH’s jurisdiction by appealing the MRD decision; the matters appealed (such as whether the services are medically necessary) are within the general jurisdiction of SOAH/MRD to decide; and there is no evidence that the Commission Hearing Division has pending compensability issues applicable to the services in dispute in this case.

The hearing reconvened on March 17, 2003, and concluded on that date.

There were no additional challenges to notice or jurisdiction, and those matters are set forth in the findings of fact and conclusions of law.

II.DISCUSSION

The parties said at the March 17, 2003, hearing that the remaining issues were: whether the Carrier could contest the medical necessity of certain treatments and services it had previously pre-authorized; if it could, whether those services were medically necessary; and whether certain other services, consisting of office visits on October 26, 1999, and January 7, 2000, a functional capacity evaluation (FCE) on January 3, 2000, range of motion (ROM) testing on August 17, 1999, and muscle testing and ROM testing on October 26, 1999, were medically necessary.

A. Background

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. The employee is specifically entitled to health care that: (1) cures or relieves the effects naturally resulting from the injury; (2) promotes recovery; or (3) enhances the ability to return to or retain employment. Tex. Labor Code Ann. § 408.021. "Health care" includes "all reasonable and necessary medical . . . services." Tex. Labor Code § 401.011(19).

On_________, the Claimant, a _____ man, suffered low back pain while helping a co-worker push a dolly. He had a previous low-back injury in_____. He first presented to the Clinic on June 19, 1998.

B. Whether the Carrier May Contest the Medical Necessity of Pre-authorized Treatments

The Carrier pre-authorized several physical medicine sessions.[2] As previously indicated, the Carrier conceded that its pre-authorized approval included the lumbar spine.

Parties

The Carrier argued that it could contest the medical necessity of the treatments despite the its pre-authorization because the Clinic either misrepresented or fraudulently stated the facts in its pre-authorization request. It cited language from TWCC rule-adoption preambles saying a pre-authorization can be challenged if it was obtained by fraud or misrepresentation.

The Carrier argued it was not precluded from asserting that the pre-authorization was obtained by misrepresentation/fraud by failing to expressly assert that matter in its TWCC 62/EOBs denying payment for the service.[3] It pointed out there was no specific denial code for that assertion. It contended the denial code “U” (unnecessary treatment without peer review)[4] that it used was adequate because the treatments were in fact unnecessary and its pre-authorizations of medical necessity were invalidly obtained. It asserted that at the time it denied the Clinic’s claim, insurers were simply required to use denial codes they thought were appropriate with no requirement for any additional explanation. It maintained if a party is going to be put in jeopardy of waiving a defense by failing to assert it, the duty to assert it should be unambiguously clear.

The Carrier stressed its position that the only real chance it has had to review the medical necessity of the treatments was through a retrospective review, given the fact that the pre-authorizations were obtained by fraud/misrepresentation. The Carrier also arguedit is only necessary to raise the misrepresentation/fraud issue at the time the provider raises the defense of pre-authorization to the Carrier’s assertion that the services were medically unnecessary. It reasoned that because the provider’s assertion that the services were pre-authorized is essentially an affirmative defense, it is only necessary to counter it when it is asserted.

The Clinic contended as follows:

Analysis

This decision concludes the Carrier is precluded from now asserting that the pre-authorizations were procured through fraud/misrepresentation because it did not assert that matter when it denied the claim or in its response to the Clinic’s request for medical dispute resolution. The following matters are significant to this conclusion:

The ALJ agrees with the majority view in previous SOAH dockets which hold that an insurer may not assert a reason for denying a claim that was not stated prior to the filing of a request for medical dispute resolution.[9] These decisions were based largely on § 408.027(d) of the Labor Code, which states that if an insurer disputes the amount of payment or the health care provider’s entitlement to payment, it must send to the Commission, the provider, and the injured employee a report that “sufficiently explains the reasons for the reduction or denial of payment. . . .” The Carrier did not raise the fraud/misrepresentation issue until the SOAH hearing.

C. Medical Necessity of Additional Services

The remaining disputed services are office visits on October 26, 1999, and January 7, 2000, an FCE on January 3, 2000, ROM testing on August 17, 1999, and muscle testing and ROM testing on October 26, 1999. The issue is whether the services were medically necessary.[10]

Carrier

The Carrier argued that two peer reviews-one dated April 18, 2000, from Dorothy Leong, M.D., a specialist in physical medicine and rehabilitation,[11] and the other dated May 10, 1999, from Patti Cates, D.C.[12]-showed the services were not medically necessary. It asserted that both doctors said the Claimant’s back problems had resolved. It contended that the Claimant’s _____, injury was merely a back strain superimposed on an existing injury that by any measure had independently resolved before the services were provided.

Dr. Leong’s letter said “. . . there is no objective indication to support the necessity of continued treatment as it relates to the injury date of 06/11/98. The MRI study of the lumbar spine was reviewed and there is no indication from the MRI to support the allegations of continued low back pain with radiation to bilaterally lower extremities as [unintelligible] as of 2/10/00.”

After reviewing relevant records, Dr. Cates said

In my opinion, the injury on _____ by the claimant was documented on June 19, 1998, by Dr. Opersteny as an acute exacerbation of low back pain at work, due to pushing and prolonged standing. . . On September 16, 1998, an examination from the Back and Joint Clinic reportedly revealed the claimant to have good range of motions documented. While overlooking the examinations performed by Back and Joint Clinic on August 21, September 16, November 9, 1998, and February 16, 1999,[13] I have noted that on September 16, 1998, no pain was noted in lumbar range of motion. Sitting and supine straight leg raising was noted at 90 degrees bilateral. Seated Kemps’ test and medical hip rotation noted painful bilaterally on all examination visits. Heel walk and toe walk was noted on Sept. 16, 1998, as within normal limits. Lumbar postural evaluation and weight bearing were noted as within normal limits. In comparison of all examination visits, on November 9, 1998, and on February 16, 1999; these examinations found more positive findings in the lumbar spine and in the wrist area than ever noted before in any prior examinations performed by Back and Joint Clinic. Per the DeLorme muscle testing performed on September 21, 1998 and October 16, 1998, the claimant had overall increased muscle strength noted on October 16, 1998.

Necessity of treatment of active and passive modalities past the October 16, 1998, DeLorme’s muscle test, I feel has not been beneficial to the claimant. MRI of the lumbar spine revealed some mild generalized disc desiccation changes with some ligament and facet hypertrophic changes. With the comprehensive testing and examination on September 16, 1998, showing results that are revealing SLR at 90 degrees, no pain in the lumbar range of motion, I feel the claimant has reached a static end point to his chiropractic care on or about October 16, 1998, and that a home exercise program could be implemented. (Emphasis in original.)

Clinic

The Clinic contended the burden of proof was on the Carrier because MRD ruled against it. It pointed out that the Carrier’s peer reviews opine that treatments are unnecessary rather than addressing office visits and diagnostic procedures.

The Clinic addressed each disputed service as follows:

a. January 7, 2000, Office Visit

The Clinic cited pages 296 and 297 of the certified record relating to the office visit, where

the Claimant reported pain in numerous areas, including his lumbar spine. The Claimant was approved to return to work with restrictions. The Clinic contended the office visit was justified because the doctor met with the Claimant to say he could return to work under restricted conditions.

b. October 26, 1999, Office Visit, Muscle Testing, and ROM Testing

The Clinic indicated CPT code 99215 for this office visit is probably the highest level of office visit. It occurred at the same time as muscle and ROM testing and included a discussion of the tests.

At pages 274 and 275 of the certified record, the testing is described in detail; the Claimant’s level of pain, including lumbar pain, and progress are also described. The Claimant reported decreased pain levels since his last visit. The Claimant’s test results are discussed beginning at page 151 and the rationale for the testing is stated as periodic monitoring of the rehabilitation process to prevent over utilization, assessment of patient progress and compliance, and setting future workout limits. The Clinic also said the test values determine the extent of the disability, quantify performance deficiencies, help detect and prove malingering, evaluate rehabilitation goals and progress, and help determine the type of rehabilitation program to be followed. The Clinic reported that the Claimant did not meet minimum acceptable performance levels, although there had been improvement since his last visit. A treatment plan is stated beginning at page 159.[14]

c. January 3, 2000, FCE

The Clinic argued the FCE was necessary because it gave a thorough breakdown of the Claimant’s physical abilities and lead to his being released to return to work. The FCE report also recounted the Claimant’s medical history since his________, injury. The examining doctor said he could return to work with restrictions.[15]

d. August 17, 1999, ROM Testing

The Clinic’s records show the results of lumbar ROM testing on August 17, 1999.[16]

Analysis

The preponderant evidence shows the services were not medically necessary. The first basis of this conclusion is the opinions of the peer review doctors. Dr. Cates based her opinion largely on a September 16, 1998, examination showing good ROM with no pain in the lumbar region. She compared these results with later tests showing more positive findings in the lumbar and wrist areas than in previous tests. She pointed out that an MRI of the lumbar spine revealed some mild generalized disc desiccation changes with some ligament and facet hypertrophic changes. This evidence appears to show the Claimant’s back problems from his________, injury had resolved within approximately three months of the injury.

Although Dr. Leong’s April 18, 2000, opinion focused primarily on the necessity of ongoing rather than previous treatments, she also said the MRI of the lumbar spine did not support continued low back pain complaints.

In addition, the evidence cited by the Clinic does not specifically and expressly state the services/treatments were necessary for treating the_______, injury. The records talk about the Claimant’s pain levels, his test results, the rationale for the testing, the FCE results, and his being approved to return to work. However, to some degree at least, the ALJ is called on to serve as his own expert in concluding that the services were necessary to treat the ____, injury. Although there might be sufficient grounds to do find the services were necessary if there were little or no evidence to the contrary, the peer review opinions against medical necessity carried more weight.

The ALJ was not persuaded by the Clinic’s argument that the peer review doctors addressed only treatments and not office visits and diagnostic procedures. Obviously, if treatments were not necessary at the time of those services, the services themselves would likely be unnecessary as well.

III.FINDINGS OF FACT

  1. On________, the Claimant suffered a compensable injury to his lumbar spine.
  2. The Claimant presented to Back and Joint Clinic (Clinic) on June 18, 1999, after which he received extensive treatment through February 2, 2000.
  3. The treatments and services at issue in this case are certain physical medicine services to the Claimant’s lumbar spine pre-authorized by National Union Fire Insurance Company of Pittsburgh Pa. (the Carrier) as medically necessary and other services, consisting of office visits on October 26, 1999, and January 7, 2000, a functional capacity evaluation (FCE) on January 3, 2000, range of motion (ROM) testing on August 19, 1999, and muscle and ROM testing on October 26, 1999.

Pre-authorized Services

  1. The Carrier claimed the physical medicine services it had pre-authorized were not medically necessary and denied the claim.
  2. The Clinic requested medical dispute resolution before the Texas Workers’ Compensation Commission medical review division (MRD).
  3. In its request for medical dispute resolution, the Clinic pointed out that the services were pre-authorized.
  4. In its response to the Clinic’s request for medical dispute resolution, the Carrier maintained its position that the physical medicine services were medically unnecessary.
  5. At the hearing, the Carrier contended for the first time that the physical medicine service pre-authorizations were obtained by fraud or misrepresentation.

October 26, 1999, and January 7, 2000, Office Visits; January 3, 2000, FCE; August 19, 1999, ROM; and October 26, 1999, Rom and Muscle Testing

  1. The Carrier’s position that the October 26, 1999, and January 7, 2000, Office Visits; January 3, 2000, FCE; August 19, 1999, ROM; and October 26, 1999, Rom and Muscle Testing were medically unnecessary was supported by peer review opinions from medical experts.
  2. A September 16, 1998, examination, approximately three months after the Claimant’s injury, showed he had good ROM with no pain in the lumbar region.
  3. Later tests showed more positive findings in the lumbar and wrist areas than in previous tests.
  4. An MRI of the lumbar spine revealed some mild generalized disc desiccation changes with some ligament and facet hypertrophic changes.
  5. Evidence cited by the Clinic to support the medical necessity of the treatments did not expressly and specifically state the services were necessary to treat the______, injury.

Costs

  1. The MRD ordered the Carrier to pay $7,896.00 to the Clinic.
  2. The amount stated in Finding of Fact No. 14 included $615.50 for the services described in Finding of Fact No. 9.

Notice

  1. All parties received not less than 10 days’ notice of the time, place, and nature of the hearing; the legal authority and jurisdiction under which the hearing was to be held; the particular sections of the statutes and rules involved; and a short, plain statement of the matters asserted.
  2. All parties had an opportunity to respond and present evidence and argument on each issue involved in the case.

IV. CONCLUSIONS OF LAW

  1. The State Office of Administrative Hearings has jurisdiction over matters related to the hearing, including the authority to issue a decision and order. Tex. Labor Code Ann. §413.031(k).
  2. All parties received proper and timely notice of the hearing. Tex. Gov’t Code Ann. §§ 2001.051 and 2001.052.
  3. The Carrier is precluded from asserting that the physical medicine services were obtained by fraud or misrepresentation. Tex. Labor Code Ann. § 408.027(d).
  4. The Carrier may not raise a lack of medical necessity as a reason for denying payment for the pre-authorized physical medicine services. Tex. Labor Code Ann. § 413.014; 28 Tex. Admin. Code § 134.600(a) (effective at the time the services were pre-authorized).
  5. The services described in Finding of Fact No. 9 were not medically necessary. Tex. Labor Code Ann. § 408.021.
  6. The Carrier should pay the Clinic $7,280.50 plus interest.

ORDER

IT IS, THEREFORE, ORDERED that National Union Fire Insurance Company of Pittsburgh Pa. pay Back and Joint Clinic $7,280.50 plus interest.

Signed this 7th day of March, 2020.

JAMES W. NORMAN
Administrative Law Judge
STATE OFFICE OF ADMINISTRATIVE HEARINGS

  1. Compensability issues are determined by the Commission Hearing Division. Tex. Labor Code Ann. ch. 410.
  2. Ex. 1 at 39-52.
  3. Although TWCC Rule 28 TAC§ 133.301(a) now says a Carrier may not retrospectively review the medical necessity of a treatment for which the provider obtained pre-authorization, it was silent on that issue at the time this matter was submitted for medical dispute resolution in June 2000. However, both parties agreed there was a general understanding that a Carrier could not revisit the issue of medical necessity once a treatment was pre-authorized. The ALJ believes this is a correct understanding. Commission Rule 134.600(a), effective at the time the services were pre-authorized, provided that a Carrier is liable for the reasonable and necessary medical costs of health care services it pre-authorized.
  4. Contrary to this description, the Carrier did obtain peer reviews.
  5. Ex. 1 at 412-420.
  6. 28 TAC §133.304(g) (in effect at the time the Clinic filed the dispute with the Commission).
  7. Ex. 1 at 18.
  8. Ex. 1 at 410.
  9. See SOAH Docket No. 453-01-1958.M5 (ALJ Corbitt); SOAH Docket No. 453-01-0309.M5 (ALJ Doherty); SOAH Docket No. 453-00-1570.M5 (ALJ Smith); SOAH Docket No. 453-99-3399 (ALJ Pacey); SOAH Docket No. 453-99-2021.M5 (ALJ Rusch); SOAH Docket No. 453-97-0973.M4 (ALJ Card); and SOAH Docket No. 453-96-0817.M4 (ALJ Corbitt).
  10. The parties cited specific pages of the 486-page certified record as supporting their contentions. The ALJ reviewed the pages cited in determining medical necessity.
  11. Ex. 1 at 412-416.
  12. Ex. 1 at 417-420.
  13. Although a period is inserted here in Dr. Cates’ narrative, the text indicates she intended a comma.
  14. Ex. 1 at 151-161.
  15. Ex. 1 at 165-172.
  16. Ex. 1 at 337. The Clinic cited the certified record at page 165 as evidence of this testing, but that page and the following pages related to the January 3, 2000, FCE. The Clinic did not specifically contend that the August 17, 1999, ROM testing was necessary apart from general arguments applicable to all services.

DECISION AND ORDER

Petitioner Injury 1 Treatment Center (ITC) seeks reimbursement of $12,352.00 for work hardening services it provided the Claimant, ____. The Administrative Law Judge (ALJ) finds the Carrier, ____, Self Insurance Fund (___SIF), should reimburse ITC the full amount, and so orders.

I. HISTORY, NOTICE, AND JURISDICTION

The Claimant sustained a compensable work-related injury on ____. ITC provided her a work hardening program from December 29, 2003, through February 20, 2004. ___SIF denied reimbursement for those services, whereupon ITC filed a request for medical dispute resolution.

On February 25, 2010, the Medical Review Division (MRD) of the Texas Department of Insurance’s (TDI’s) Division of Workers’ Compensation issued its Findings and Decision.[1] The MRD denied reimbursement on the basis that the work hardening program was not preauthorized and the Division’s archived records did not indicate that ITC was exempt from the preauthorization requirement.

ITC filed a timely request for a hearing before the State Office of Administrative Hearings (SOAH). Adequate and timely notice of the hearing originally was sent to both parties on March 15, 2010. The hearing was continued and ultimately reset for June 28, 2010. It was convened on that date before ALJ Henry D. Card. Both parties appeared and participated in the hearing. The record closed that same day.

SOAH has jurisdiction over this proceeding, including the authority to issue a decision and order, pursuant to Tex. Lab. Code Ann. §413.031(k) and Tex. Gov’t Code Ann. ch. 2003. Under 28 Tex. Admin. Code § 148.14(a), the Petitioner has the burden of proof in this proceeding.

II. DISCUSSION

The parties addressed three issues. First, they agreed that the MRD’s rationale for its decision was mistaken. ITC presented evidence, with which ___SIF concurred, that ITC was CARF-accredited at the time the services were performed and, therefore, preauthorization was not required. The MRD had reviewed a brief period, which began January 1, 2004, during which the Commission exemption from preauthorization was not in place and, therefore, facilities were not listed in the Division’s records. A TDI Advisory stated, however, that services that began before December 31, 2003, would not require preauthorization. The services in dispute in this case began December 29, 2003. ITC was not required to receive preauthorization for the work hardening program in question.

Second, ___SIF contended that the work hardening program was outside the scope of the Claimant’s compensable injury. As determined by a Hearings Officer on ____, and confirmed by the Appeals Panel on ____, the Claimant’s compensable injury consisted of a left shoulder and cervical sprain/strain. The compensable injury did not include an injury “to the low back, thoracic area, cervical disc herniation, and the right shoulder.”[2] The work hardening program was not confined to the left shoulder and cervical areas, but addressed other areas outside the area of the compensable injury.

ITC responded that ____SIF did not allege in its Explanations of Benefits (EOBs) that the work hardening program was outside the scope of the compensable injury. On those EOBs, ___SIF rejected the work hardening services as “U-Unnecessary treatment.” It did not list “R-Extent of Injury,” which is a separate code, as a reason for denying reimbursement. ITC argues that ____SIF is limited to the codes it used on its EOBs.

ITC is correct. In Docket No. 453-96-1446.M4, Liberty Mutual Fire Insurance Company v. Texas Workers' Compensation Commission and ____ (Nov. 12, 1996), the ALJ cited what is now Tex. Lab. Code Ann. §408.027(e) of the Act, which states:

(e) If an insurance carrier disputes the amount of payment or the health care provider's entitlement to payment, the insurance carrier shall send to the division, the health care provider, and the injured employee a report that sufficiently explains the reasons for the reduction or denial of payment for health care services provided to the employee. The insurance carrier is entitled to a hearing as provided by Section 413.031(d).[3]

The ALJ concluded that, in the hearing at SOAH, the carrier was limited to the reasons for denial it cited in its EOBs. That reasoning has been followed in other SOAH decisions.[4]

____SIF argued that the concept of unnecessary medical treatment encompasses treatment beyond the scope of the injury. The ALJ disagrees. The Division recognized “Extent of Injury” as a

separate denial code. If that was the reason for denying reimbursement, ___SIF was obligated to say so.

Finally, the parties disagreed about whether the work hardening program was medically necessary. The documentation submitted by ITC shows the Claimant met the criteria for a multi-disciplinary work hardening program.[5] There was no evidence to the contrary. The ALJ finds the program was medically necessary and concludes ___SIF should reimburse ITC the full amount of $12,352.00, plus interest to the extent required by law.

III. FINDINGS OF FACT

  1. The Claimant, ___., sustained a compensable work-related injury on _____.
  2. Injury 1 Treatment Center (ITC) provided the Claimant a work hardening program from December 29, 2003, through February 20, 2004.
  3. ITC requested reimbursement of $12,352.00 for the work hardening program from ____, Self Insurance Fund (___SIF), the Claimant’s workers’ compensation carrier.
  4. ____SIF denied reimbursement for those services, whereupon ITC filed a request for medical dispute resolution.
  5. On February 25, 2010, the Medical Review Division (MRD) of the Texas Department of Insurance’s (TDI’s) Division of Workers’ Compensation issued its Findings and Decision. The MRD denied reimbursement on the basis that the work hardening program was not preauthorized and the Division’s archived records did not indicate that ITC was exempt from the preauthorization requirement.
  6. ITC filed a timely request for a hearing before the State Office of Administrative Hearings (SOAH).
  7. The notice contained a statement of the time, place, and nature of the hearing; a statement of the legal authority and jurisdiction under which the hearing was to be held; a reference to the particular sections of the statutes and rules involved; and a short, plain statement of the matters asserted.
  8. The hearing was continued and ultimately reset for June 28, 2010. It was convened on that date before ALJ Henry D. Card. Both parties appeared and participated in the hearing. The record closed that same day.
  9. ITC was CARF-accredited at the time the services were performed.
  10. On its Explanations of Benefits (EOBs) denying reimbursement, ____SIF rejected the work hardening services as “U-Unnecessary treatment.”
  11. ____SIF did not list “R-Extent of Injury,” which is a separate code, as a reason for denying reimbursement.
  12. The Claimant met the criteria for a multi-disciplinary work hardening program.
  13. The work hardening program was medically necessary.

IV. CONCLUSIONS OF LAW

  1. SOAH has jurisdiction over this proceeding, including the authority to issue a decision and order, pursuant to Tex. Lab. Code Ann. §413.031(k) and Tex. Gov’t Code Ann. ch. 2003.
  2. Adequate and timely notice of the hearing was provided in accordance with Tex. Gov’t Code Ann. §§ 2001.051 and 2001.052.
  3. Under 28 Tex. Admin. Code § 148.14(a), the Petitioner has the burden of proof in this proceeding.
  4. ITC was not required to receive preauthorization for the work hardening program.
  5. Pursuant to Tex. Lab. Code Ann. §408.027(e), ___SIF was required to identify “Extent of Injury” as a reason for denying reimbursement in order to raise that issue in subsequent proceedings. Docket No. 453-96-1446.M4, Liberty Mutual Fire Insurance Company v. Texas Workers' Compensation Commission and ___ (Nov. 12, 1996); Docket No. 453-97-0973.M4, ___ v. Texas Workers’ Compensation Commission and Texas Workers’ Compensation Insurance Fund (May 14, 1998).
  6. ___SIF should reimburse ITC the full amount of $12,352.00, plus interest to the extent required by law.

ORDER

It is, therefore, ordered that ____, Self Insurance Fund, shall reimburse Injury 1 Treatment Center $12,352.00, plus interest to the extent required by law, for the services in dispute in this matter.

Signed August 13, 2010.

HENRY D. CARD
Administrative Law Judge
STATE OFFICE OF ADMINISTRATIVE HEARINGS

  1. It is not clear why such a long time elapsed between the original filing and the Findings and Decision.
  2. Petitioner’s Ex. 1, page 18.
  3. At the time of that decision, that section was 408.027(d), which referred to the “commission” rather than the “division.”
  4. See, e.g. Docket No. 453-97-0973.M4, __ v. Texas Workers’ Compensation Commission and Texas Workers’ Compensation Insurance Fund (May 14, 1998).
  5. Petitioner’s Ex. 1, pages 37-46.

DECISION AND ORDER

__(__) seeks relief from an order of the Medical Review Division (MRD) of the Texas Department of Insurance, Division of Workers’ Compensation (TDI-DWC), requiring it to reimburse Horizon Health (Horizon) $14,398.29 for treatment provided to an injured city employee (Claimant) during 2004. The Administrative Law Judge (ALJ) concludes __ proved the treatment in dispute was not medically reasonable or necessary and orders denial of Horizon’s claim.

I. JURISDICTION, NOTICE, AND PROCEDURAL HISTORY

The State Office of Administrative Hearings (SOAH) has jurisdiction over this proceeding, including the authority to issue a decision and order, pursuant to Tex. Lab. Code Ann. § 413.031(k) and Tex. Gov’t Code Ann. ch. 2003.

Claimant underwent physical therapy withHorizon from May 26 to August 27, 2004, the disputed dates of service. ____, as the self-insured workers’ compensation insurance carrier, denied reimbursement for the treatment. Horizon filed a request for medical dispute resolution with the MRD. The MRD referred Horizon’s request to an Independent Review Organization (IRO). The IRO found the disputed physical therapy was reasonable and medically necessary and ordered $14,338.29 in reimbursement. The MRD itself reviewed CPT Code 99080-73 for four dates of service between May 26 and August 27, 2004, and ordered reimbursement of $15 per visit for a total of $60. The total ordered reimbursement was $14,398.29. The MRD issued its decision, granting Horizon’s request, on August 30, 2005.[2]

____ appealed the MRD decision to Travis County District Court, which remanded the case to TDI-DWC on November 10, 2008.[3] TDI-DWC sent its docket request to SOAH on March 9, 2009. The hearing was originally set for April 20, 2009,[4] but was continued several times, ultimately to April 16, 2010.[5]

On June 8, 2009, Horizon filed an untimely Motion for Summary Judgment that was denied on June 22, 2009. Horizon filed its First Amended Motion for Summary Judgment on August 1, 2009, and the ALJ denied the amended motion on August 28, 2009. Horizon re-urged its Motion for Summary Disposition at the hearing on the merits to preserve it for the record.

The hearing on the merits convened April 16, 2010, before ALJ Sharon Cloninger at SOAH, William P. Clements State Office Building, 300 West 15th Street, Fourth Floor, Austin, Texas. ____ was represented by Timothy R. White, attorney. Annie Basu, attorney, represented Horizon. The hearing adjourned and the record closed that same day.

II. APPLICABLE LAW

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. The employee is specifically entitled to health care that: (1) cures or relieves the effects naturally resulting from the compensable injury; (2) promotes recovery; or (3) enhances the ability of the employee to return to or retain employment. Tex. Lab. Code Ann. § 408.021(a).

Under 28 Tex. Admin. Code (TAC) § 148.14(a), Houston, as the petitioner, has the burden of proof in this proceeding.

III. EVIDENCE AND DISCUSSION

A. Background

Claimant, ___, sustained a compensable injury to her right arm and hand on ____, when she tried to loosen a fire hydrant.[6] Two days later, Claimant saw Carrie Schwartz, D.C., at Horizon. From February 27 to May 20, 2004, Claimant was in physical therapy with Dr. Schwartz three times weekly.[7]

Subsequently, Dr. Schwartz provided Claimant with physical therapy during 42 office visits from May 26, 2004, through August 27, 2004, the disputed dates of service. According to the Table of Disputed Services,[8] ___ did not reimburse Horizon for office visits, therapeutic exercises, neuromuscular re-education, and manual therapy techniques, CPT codes 97110, 97112, 99212, and 99213. The reason ____ gave for nonpayment on the Explanations of Benefits (EOBs) was code V, unnecessary treatment (with peer review).[9]

B. Independent Medical Evaluation (IME)

The peer review relied upon by ___ in its denial of Horizon’s claim was the IME performed by Dr. George, an orthopedic surgeon, on May 20, 2004.[9] During Dr. George’s evaluation, Claimant complained of moderate pain from the shoulder down her entire arm and said the pain worsened with activity. Dr. George had no diagnostic studies for his review. His own testing of Claimant showed equal range of motion on the right and left sides of the body for the shoulders, elbow joints, elbow joint rotation, and wrists; normal muscle strength in the shoulders, elbows, forearms, wrists, and hands; and grip strength of 5 in the right hand and 80 in the left hand. At the hearing, Dr. George testified that he gave little weight to the grip strength test, because the test is subjective; that is, a patient can pretend to squeeze the instrument. His diagnosis of Claimant’s condition was “cervical/arm type syndrome.”

Dr. George concluded that further chiropractic treatment of Claimant’s right arm and wrist would be of no benefit to her. Instead, because he believed nerve impingement could be the source of Claimant’s pain, he agreed that she should undergo the scheduled EMG/nerve conduction studies of the cervical spine and right upper extremity. He further concluded that she could return to work on light duty.

C. Claimant’s Medical Treatment

In addition to Dr. George’s IME, ___ relies on the following evidence reviewed by the IRO in support of its position that Claimant’s treatment on the disputed dates of service was not reasonable or medically necessary:

Only one doctor recommended physical therapy for Claimant during the disputed dates of service. Orthopedic surgeon Andrew K. Lee saw Claimant on July 12, 2004, “due to [her] persistent symptoms despite conservative management.”[18] He diagnosed Claimant with right shoulder impingement syndrome and cervical strain. He recommended physical therapy for the neck and shoulder and use of anti-inflammatory medications. The ALJ notes that Claimant reported her injury to be to her shoulder, elbow, and forearm, not to her neck. Dr. Lee did not tie Claimant’s cervical strain to her compensable injury. Dr. Lee did not state why he recommended physical therapy when ongoing conservative treatment had not alleviated Claimant’s symptoms.

In addition to Dr. George’s IME and the documents reviewed by the IRO, ___ relied on a Peer Review prepared by William E. Blair, Jr., M.D., on June 13, 2009.[19] Dr. Blair is an orthopedic surgeon who is certified in the evaluation of disability and impairment rating by the American Academy of Evaluating Disability Physicians.[20] Dr. Blair strongly disagreed with the IRO decision. He noted that Dr. George’s clinical examination of Claimant on May 28, 2004, was essentially unremarkable. He said the majority of diagnoses in Claimant’s case were based on subjective issues, not on objective data. He observed that Horizon’s treatment of Claimant on the disputed dates of service did not result in a “materialistic improvement” of her condition.[21] Dr. Blair concluded that, at most, Claimant sustained a sprain/strain overuse syndrome, which would have resolved with or without medical care.[22]

Dr. Blair further opined that any treatment of Claimant’s compensable injury should have lasted no more than 6-to-12 weeks, [23] not from February 27 to August 27, 2004. As a basis for his opinion, Dr. Blair stated that the disability time frame for supportive treatment for wrist sprain or strain would be between 21 and 42 days.[24] Similarly, he said the disability time frame for supportive treatment for a sprain or strain to the elbow to be between 14 and 42 days.[25] Dr. Blair’s opinion was based in part on Claimant’s unremarkable MRI scan,[26] the lack of evidence of any structural deficiency, and Claimant’s normal sensation, strength, reflexes and range of motion.[27] He said his visit-by-visit review of Horizon’s records for the disputed dates of service show no medical basis to support the necessity, frequency, or duration of Claimant’s treatment.[28]

IV. CONCLUSION

___ proved by a preponderance of the evidence that Horizon’s treatment of Claimant on the disputed dates of service was not reasonable or medically necessary under Tex. Lab. Code Ann. § 408.021(a). Horizon’s treatment records for the disputed dates of service contain no evidence that the chiropractic treatment cured or relieved the effects naturally resulting from Claimant’s compensable injury, promoted her recovery, or enhanced her ability to return to work. Before the first disputed date of service (May 27, 2004) Claimant had already undergone 12 weeks of conservative treatment with no documented subjective or objective improvement in her condition. The ALJ is persuaded by Dr. Blair that Claimant’s condition could have resolved on its own or with, at most, 12 weeks of conservative treatment. By the first disputed date of service, Claimant had already undergone 12 weeks of conservative treatment and was scheduled for an EMG/nerve conduction study. No further physical therapy was warranted and Horizon’s treatment on the disputed dates of service was neither reasonable nor medically necessary.

V. FINDINGS OF FACT

  1. Claimant, ____, sustained a compensable injury to her right arm and hand on _____, when she tried to loosen a fire hydrant.
  2. Claimant’s right shoulder, elbow, and forearm were sprained or strained when she was injured.
  3. Two days following her injury, Claimant saw Carrie Schwartz, D.C., at Horizon Health (Horizon) and underwent physical therapy three times weekly from February 27 to May 20, 2004.
  4. Subsequently, Dr. Schwartz provided Claimant with physical therapy during 42 office visits from May 26, 2004, through August 27, 2004 (the disputed dates of service).
  5. Horizon sought reimbursement for Claimant’s care from the __ (__), Claimant’s employer and a self-insured workers’ compensation carrier.
  6. __ denied payment for the disputed dates of service based on an Independent Medical Evaluation (IME) by Charles George, M.D., who examined Claimant on May 20, 2004.
  7. Horizon filed a request for medical dispute resolution with the Medical Review Division (MRD) of the Texas Department of Insurance, Division of Workers’ Compensation (TDI-DWC).
  8. The MRD referred the medical necessity issues to an Independent Review Organization (IRO).
  9. The IRO found the disputed physical therapy to be medically necessary in the amount of $14,338.29.
  10. The MRD itself reviewed CPT Code 99080-73 for four dates of service between May 26 and August 27, 2004, and on August 30, 2005, ordered reimbursement of $15 per visit or $60 total in addition to the $14,338.29 recommended by the IRO, for a total of $14,398.29.
  11. __contested the MRD decision in Travis County District Court.
  12. The District Court remanded the proceeding to the MRD on November 10, 2008.
  13. On March 9, 2009, TDI-DWC requested that SOAH docket the case.
  14. In a March 26, 2009 Agreed Motion for Continuance, the parties referenced a hearing date of April 20, 2009. Notice of the April 20, 2009 hearing date is not in evidence. Neither party contested proper notice. Both parties fully participated in this proceeding from March 26, 2009, through April 16, 2010, when the hearing on the merits was held pursuant to the Order of Continuance issued on September 29, 2009.
  15. The hearing was held on April 16, 2010, before ALJ Sharon Cloninger at SOAH, William P. Clements State Office Building, 300 West 15th Street, Fourth Floor, Austin, Texas. __ was represented by Timothy R. White, attorney. Annie Basu, attorney, represented Horizon. The hearing concluded and the record was closed that same day.
  16. As of the May 20, 2004 IME, Claimant had equal range of motion in the right and left shoulders, elbow joints, elbow joint rotation, and wrists; normal muscle strength in the shoulders, elbows, forearms, wrists, and hands; and grip strength of 5 in the right hand and 80 in the left hand.
  17. The grip strength test is a subjective test that should be given little weight.
  18. MRIs of Claimant’s right wrist and elbow taken on April 8, 2004, were unremarkable.
  19. On June 3, 2004, Claimant underwent an electrodiagnostic evaluation of the right elbow and forearm with results in the normal range.
  20. On June 24, 2004, Ben Tinongson, M.D., a pain management specialist, recommended that Claimant undergo a right stellate ganglion nerve block which was performed in October 2004, after the disputed dates of service.
  21. On July 14, 2004, Claimant was not at maximum medical improvement and a work hardening or pain program to be followed by a functional capacity evaluation was recommended for her.
  22. During the disputed dates of service, Claimant received the identical treatment on each of the 42 visits with no objective evidence of improvement in her condition.
  23. Conservative treatment of Claimant’s compensable injury should have lasted no longer than 12 weeks.
  24. Claimant had already undergone 12 weeks of conservative treatment by May 27, 2004, the first disputed date of service.

VI. CONCLUSIONS OF LAW

  1. SOAH has jurisdiction over this proceeding, including the authority to issue a decision and order, pursuant to Tex. Lab. Code Ann. § 413.031(k) and Tex. Gov’t Code Ann. ch. 2003.
  2. The parties did not object to adequate and timely notice of the hearing and waived objection by their full participation in the proceeding.
  3. __ carried its burden of proof. 28 Tex. Admin. Code § 148.14(a).
  4. Based on the above Findings of Fact, Horizon’s treatment of Claimant on the disputed dates of service was not reasonable or medically necessary under the requirements of Tex. Lab. Code Ann. § 408.021(a).
  5. __ should not reimburse Horizon for the disputed medical services.

ORDER

__ shall not reimburse Horizon Health $14,398.29 for the services in dispute in this matter.

Signed June 15, 2010.

SHARON CLONINGER
Administrative Law Judge
STATE OFFICE OF ADMINISTRATIVE HEARINGS

  1. Horizon Ex. 2 and ____ Ex. A.
  2. According to a March 6, 2009 letter to TDI-DWC from ___ attorney Timothy R. White, the remand was necessary in light of a decision by Travis County District Court Judge Stephen Yelenosky in HCA Healthcare Corp., et al. v. TDI, et al., Cause No. D-1-GN-06-000176, which declared the old MDR appeal statute, Tex. Lab. Code Ann. § 413.031(k), unconstitutional. Mr. White’s letter states Judge Yelenosky decided a hearing must be held on the record before a case can be appealed to District Court for substantial evidence review. Mr. White’s letter is attached to TDI-DWC’s request that SOAH docket the case and is not in evidence.
  3. SOAH’s file contains no hearing notice and none was introduced into evidence. The ALJ gleans the original hearing date from the Agreed Motion for Continuance filed on March 26, 2009. Notice was not objected to by either party and both of them fully participated in the proceeding.
  4. The Order of Continuance setting the evidentiary hearing for April 16, 2010, was issued on September 29, 2009.
  5. Horizon Ex. 3 at 7.
  6. The medical records for these dates of service are not in evidence. The only references to the February-May 20, 2004 treatment are contained in the Independent Medical Evaluation (IME) report prepared by Charles George, M.D., on May 28, 2004 (See Houston Ex. B) and the Designated Doctor examination by William W. Janes, M.D. (See Horizon Ex. 3 at 32-35). The ALJ notes that Dr. George’s IME report was not provided to the IRO. Dr. Janes’ Designated Doctor report, which was reviewed by the IRO, contains only a one-sentence reference to the prior physical therapy.
  7. Horizon Ex. 3 at 58-70.
  8. ___ Ex. D at 1-21 and Horizon Ex. 3 at 71-90.
  9. __ Ex. B.
  10. Horizon Ex. 3 at 11.
  11. Horizon Ex. 3 at 12.
  12. Horizon Ex. 3 at 17-18.
  13. Horizon Ex. 3 at 13-14 and __ Ex. F at 3-4.
  14. Horizon Ex. 3 at 23-24. Dr. Tiongson performed a right stellate ganglion nerve block on Claimant on October 20, 2004. Horizon Ex. 3 at 21-22.
  15. Horizon Ex. 3 at 32-35.
  16. Horizon Ex. 3 at 39-52. See conclusion by peer reviewer William E. Blair, Jr., M.D., __ Ex. C at the bottom of page 15.
  17. Horizon Ex. 3 at 19.
  18. __ Ex. C.
  19. __Ex. C at 17.
  20. __Ex. C at 17.
  21. Houston Ex. C at 16.
  22. Houston Ex. C at 10.
  23. Houston Ex. C at 5.
  24. Houston Ex. C at 5.
  25. Houston Ex. C at 10.
  26. Houston Ex. C at 14.
  27. Houston Ex. C at 15.

DECISION AND ORDER

Petitioner Ark-La-Tex Health Center, Inc. (ALTHC) seeks reimbursement of $6,626.00 for spinal manipulation therapy and electrical stimulation it provided the Claimant, ___, during 2006. The Administrative Law Judge concludes ALTHC proved the medical necessity of the spinal manipulation therapy, but not that of the electrical stimulation. He orders reimbursement of $4,806.00, which is the amount of the disputed charges for spinal manipulation therapy.

I. HISTORY, NOTICE, AND JURISDICTION

The Claimant sustained a compensable injury work-related incident on ____. Originally, the injury was diagnosed as an inguinal hernia only, but it was later diagnosed by James Raker, D.C., of ALTHC as a lumbar strain/sprain as well.[1] Dr. Raker began treating the Claimant for the lumbar strain/sprain in September of 2003 and has continued to do so. From January 20, 2006, through December 13, 2006, which are the disputed dates of service in this proceeding, ALTHC provided the Claimant 89 units of spinal manipulation therapy (CPT Code 98941) and 91 units of electrical stimulation (Code G0283). The workers’ compensation carrier, Texas Mutual Insurance Company (TMIC), declined to pay for those services, whereupon ALTHC filed a timely Request for Medical Dispute Resolution.

The Independent Review Organization (IRO) issued its revised decision, denying ALTHC’s request, on February 12, 2008.[2] Although ALTHC’s request for hearing was dated February 16, 2008, TMIC presented evidence that the request was received by the Texas Department of Insurance’s Division of Workers’ Compensation (DWC) on April 7, 2008, more than the twenty days allowed by 28 Tex. Admin. Code (TAC) § 148.3(a). TMIC moved to dismiss this case for that reason and due to other deficiencies in ALTHC’s filing. At the hearing on the motion, ALTHC produced a copy of its request, showing a successful timely transmission to DWC on February 15, 2008. The ALJ denied the motion to dismiss on January 30, 2009.

Adequate and timely notice of the hearing originally was sent to both parties May 5, 2008. The last order of continuance was sent to both parties June 12, 2009, setting the hearing for August 6, 2009. The hearing was held on that date, with both ALTHC and TMIC participating. Both parties offered various documents into evidence. ALTHC presented testimony from Dr. Raker and the Claimant; TMIC presented testimony by David Alvarado, D.C. The record was closed that day, August 6, 2009.

SOAH has jurisdiction over this proceeding, including the authority to issue a decision and order, pursuant to Tex. Lab. Code Ann. §413.031(k) and Tex. Gov’t Code Ann. ch. 2003. Under 28 Tex. Admin. Code (TAC) § 148.14(a), the Petitioner, ALTHC, has the burden of proof in this proceeding.

II. DISCUSSION

The Claimant, who was ___ old and working as a ____ at the time of his injury, testified he originally was treated only for the hernia. In September 2003, he went to see Dr. Raker, who began treating him for his continuing back and hip pain. He stated Dr. Raker’s treatments temporarily alleviated his pain and enabled him to move around. He was still working until the summer of 2006, when he retired.

Dr. Raker testified the Claimant’s lumbar strain/sprain had become a chronic condition by the time he began treating him, presumably because of the lack of earlier diagnosis and treatment. Claimant was not a viable surgical candidate, both because of his age and because his condition did not warrant surgery. He testified the Claimant had declined pain medication because of his employment as an armed security guard. Dr. Raker believed such medications also were not appropriate treatment because of the Claimant’s age. The Claimant declined ESI injections for his condition.

In Dr. Raker’s opinion, his use of spinal manipulation therapy and electrical stimulation was appropriate and necessary to relieve the Claimant’s pain, which is one of the criteria for necessary treatment under the Labor Code. ALTHC also presented into evidence several medical articles, which Dr. Raker interpreted as supporting the use of spinal manipulation therapy for chronic lower back pain.

Dr. Alvarado agreed that the Claimant might be suffering from a chronic condition. He did not agree with ALTHC’s course of treatment, however. He considered Dr. Raker’s use of spinal manipulation therapy and electrical stimulation to be excessive. In his opinion, those passive modalities might be appropriate for occasional flare-ups of a condition, but not as a constant course of treatment. He testified that excessive use of those treatments encouraged dependency on the doctor rather than rehabilitation of the patient’s condition. He found ALTHC’s use of those modalities to be inconsistent with the Official Disability Guidelines (ODG) and with good medical practice.

Dr. Alvarado noted that the records he had received contained no formal evaluation or reevaluation of the Claimant’s condition, did not prescribe a regimen of active home exercise, and did not contain a formal treatment plan. He also took issue with Dr. Raker’s interpretation of the articles provided by ALTHC. In Dr. Alvarado’s opinion, those articles supported the concept of time-limited passive care, followed by active independent rehabilitative measures.

In response to two of those criticisms, Dr. Raker stated he evaluated the Claimant’s condition every time he saw him, and pointed to a mention of home exercises in his notes.

The ALJ finds that the articles supplied by ALTHC, combined with Dr. Raker’s testimony, support the medical necessity of the spinal manipulation therapy. As ALTHC pointed out,Tex. Lab. Code Ann. § 408.021 states;

ENTITLEMENT TO MEDICAL BENEFITS. (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. The employee is specifically entitled to health care that: (1) cures or relieves the effects naturally resulting from the compensable injury; (2) promotes recovery; or (3) enhances the ability of the employee to return to or retain employment.

Dr. Raker and the Claimant testified that his treatment relieved the effects of the compensable injury, if only temporarily. Dr. Raker also explained why other forms of treatment, such as medication, were medically inappropriate for the Claimant. Dr. Raker also established that the Claimant was engaging in home exercises, although those were not well documented. Although Dr. Alvarado described the Claimant as being doctor-dependent, the only support for that assertion was the number of treatments themselves. The number of treatments does not necessarily disqualify those services from reimbursement, however.

The articles supplied by ALTHC establish only the efficacy of spinal manipulation therapy for chronic lumbar pain. They do not show electrical stimulation to be medically necessary for that condition. The testimony does not show whether one type of treatment, or both, relieved the Claimant’s symptoms. Therefore, although ALTHC did prove the medical necessity of the spinal manipulation therapy, it did not prove the necessity of the electrical stimulation. The ALJ concludes ALTHC should be reimbursed only $4,806.00, which is the amount of the disputed charges for spinal manipulation therapy, and not the remaining amount for the electrical stimulation treatments.

III. FINDINGS OF FACT

  1. The Claimant, ____., sustained a compensable injury work-related incident on ____.
  2. Originally, ___.’s injury was diagnosed as an inguinal hernia only, but it was later diagnosed by James Raker, D.C., of ALTHC as a lumbar strain/sprain as well.
  3. Dr. Raker began treating the Claimant for the lumbar strain/sprain in September of 2003 and has continued to do so.
  4. From January 20, 2006, through December 13, 2006, which are the disputed dates of service in this proceeding, ALTHC provided the Claimant 89 units of spinal manipulation therapy (CPT Code 98941) and 91 units of electrical stimulation (Code G0283).
  5. The workers’ compensation carrier, Texas Mutual Insurance Company (TMIC), declined to pay for the spinal manipulation therapy and electrical stimulation provided during 2006, whereupon ALTHC filed a timely Request for Medical Dispute Resolution.
  6. The Independent Review Organization (IRO) issued its revised decision, denying ALTHC’s request, on February 12, 2008.
  7. The request for hearing was transmitted to the Texas Department of Insurance’s Division of Workers’ Compensation (DWC) on February 15, 2008.
  8. Adequate and timely notice of the hearing originally was sent to both parties May 5, 2008. The last order of continuance was sent to both parties June 12, 2009, setting the hearing for August 6, 2009.
  9. The hearing was held on August 6, 2009, with both ALTHC and TMIC participating. Both parties offered various documents into evidence. The record was closed August 6, 2009.
  10. The Claimant was ___ old and working as a ___ at the time of his injury.
  11. The Claimant was still working until the summer of 2006, when he retired.
  12. By the time Dr. Raker began treating him, the Claimant’s lumbar strain/sprain had become a chronic condition.
  13. The Claimant was not a viable surgical candidate, both because of his age and because his condition did not warrant surgery.
  14. The Claimant declined pain medication because of his employment as an ____; those medications also were not appropriate treatment because of the Claimant’s age.
  15. The Claimant declined ESI injections for his condition.
  16. ALTHC’s treatments relieved the Claimant’s back and leg pain, albeit temporarily.
  17. The evidence supports the use of spinal manipulation therapy for chronic lower back pain.
  18. The evidence does not support the use of electrical stimulation for chronic lower back pain.
  19. ALTHC seeks reimbursement of $6,626.00 for the spinal manipulation therapy and electrical stimulation it provided the Claimant, ____., during 2006.
  20. The disputed charges for spinal manipulation therapy during 2006 total $4,806.00.

IV. CONCLUSIONS OF LAW

  1. SOAH has jurisdiction over this proceeding, including the authority to issue a decision and order, pursuant to Tex. Lab. Code Ann. §413.031(k) and Tex. Gov’t Code Ann. ch. 2003.
  2. Adequate and timely notice of the hearing was provided in accordance with Tex. Gov’t Code Ann. §§ 2001.051 and 2001.052.
  3. Under 28 Tex. Admin. Code § 148.14(a), the Petitioner, ALTHC, has the burden of proof in this proceeding.
  4. ALTHC should be reimbursed for the disputed spinal manipulation therapy provided the Claimant.
  5. ALTHC should not be reimbursed for the disputed electrical stimulation therapy provided the Claimant.
  6. TMIC should reimburse ALTHC $4,806.00, plus interest to the extent required by law.

ORDER

It is, therefore, ordered that Texas Mutual Insurance Company shall reimburse Ark-La-Tex Health Center, Inc., $4,806.00, plus interest to the extent required by law, for the services in dispute in this matter.

Signed September 17, 2009.

HENRY D. CARD
Administrative Law Judge
STATE OFFICE OF ADMINISTRATIVE HEARINGS

  1. Petitioner Ex. A-2.
  2. The original decision did not recognize the compensability of the lumbar strain/sprain.

DECISION AND ORDER

Safety National Casualty Corporation (Carrier) appealed from an adverse Medical Dispute Resolution decision issued by the Texas Department of Insurance, Division of Workers’ Compensation (Division) ordering it to reimburse Dallas Multidisciplinary Clinic/Dallas Integrated Healthcare (Provider) for physical therapy services rendered between January 9, 2006, and March 15, 2006, for Claimant ____. A total of $ 4,298.61 was in dispute regarding the physical therapy that Provider administered.

The ALJ concluded that Carrier failed to establish that the Division’s medical fee dispute resolution decision was in error. Provider administered physical therapy services that treated Claimant’s compensable injury so Carrier should reimburse Provider the billed amount.

I. Jurisdiction, Notice, and Procedural History

The hearing convened October 22, 2008, before ALJ Cassandra J. Church in Austin, Texas, and the record closed that day. Carrier was represented by S. Rhett Robinson, attorney, and Provider was represented by Matthew Lewis, attorney. The parties offered competent evidence establishing jurisdiction and also that the Division provided appropriate notice of the hearing to the parties.

II. SUMMARY OF DISPUTE AND APPLICABLE LAW

A. History of the Case

Claimant suffered a back injury on _____, when he was bumped or hit by a forklift.[1] On August 22, 2005, Claimant underwent a spinal fusion of the L4-L5 levels. Claimant had not undertaken any physical therapy after the surgery.[2] On December 29, 2005, and February 2, 2006, Carrier preauthorized 24 sessions of physical therapy. In both pre-authorization letters, Carrier stated that it was disputing the extent of injury to exclude any degenerative changes and also any psychological issues.[3]

Provider provided services to Claimant on several dates between January 9, 2006, and March 15, 2006, billing a total of $ 4,298.61.[4] Those services included assisting Claimant perform stretching and range of motion exercises for the lumbar spine as well as administering ultrasound and traction, making chiropractic adjustments, and electrically stimulating the lumbar spine.[5] Except for the chiropractic adjustments, Provider’s treatment notes did not identify a particular zone of the lumbar spine to which any of the procedures was directed. On January 9, 2006, Provider’s staff adjusted the L5 vertebra; on January 17 and 19, the C5, C6, T4, and L5 vertebrae.[6] Claimant was ruled capable of returning to work in March 2006, with restrictions.

In April 2005, R. A. Buczek, D.O., D.C., conducted a retrospective peer review of Claimant’s case and concluded that Claimant’s compensable injury was limited to a lumbar strain, that any psychological symptoms pre-dated the compensable injury, and recommended against further diagnostic testing, chiropractic treatments, or physical medicine treatment. However, Dr. Buczek also recommended a course of facet injections to address the source of Claimant’s ongoing back pain, and up to 24 sessions of physical therapy to be followed by either a course of work hardening or a combination of work conditioning and a return-to-work program.

In January 2005, before Dr. Buczek’s review, Carrier had initiated its challenge to the extent of Claimant’s injury, with that proceeding running parallel to the ongoing treatment program. In an administrative decision issued on July 17, 2006, the Division concurred with Carrier that the compensable injury was limited to a lumbar strain.[7] Excluded from the compensable injury were a disc bulge, disc dehydration, and other degenerative conditions that doctors had observed in Claimant’s lumbar spine and also the psychological issues.

Carrier denied payment for all dates of service in early 2006 on the bases that compensation was not warranted based on the peer review and also that Provider had failed to provide enough information to enable it to adjudicate the claim.[8] Provider sought medical dispute resolution (MDR) review, and on June 20, 2008, Donna Aubry, a Dispute Resolution Officer (DRO) with the Division, ruled in favor of Provider for all dates of service in January 2006.[9] Carrier timely requested a contested-case hearing at the State Office of Administrative Hearings (SOAH).

B. Summary of Dispute

Carrier asserted that, notwithstanding its preauthorization for treatment, it was entitled to conduct a retrospective review regarding the scope of services provided and proper billing procedures. It did not dispute that it was barred from disputing the medical necessity for the treatment, but contended that it had not done so. Carrier asserted that Provider treated only the disputed degenerative conditions, based on diagnosis codes listed on Provider’s records. Carrier also asserted that Provider had assumed the risk of possible non-payment for services that entailed treatment for any disputed body area or condition, because preauthorization does not constitute a guarantee of payment.

Carrier also asserted that its notification to Provider of its extent-of-injury challenge via the preauthorization letters was sufficient notification to Provider that it would, most likely, deny payment on the grounds extent of injury.[10] Carrier acknowledged that the Explanation of Benefits (EOB) did not specifically state that an extent-of-injury challenge was pending, but contended that failure to do so did not waive its claim to pursue that issue through MDR. Carrier noted that the preauthorization letters had not only stated that such a claim was in progress, but also listed which elements of Claimant’s diagnosis it was challenging. In short, Carrier asserted that the DRO was in error and that Provider’s claim should be denied in its entirety.

Provider contended that the treatment it provided in January 2006 was general back therapy that addressed Claimant’s lumbar strain and post-surgery rehabilitation, thus fit within the terms of the preauthorization. Provider also claimed that Carrier misread the purpose of the CPT codes listed on its medical records, asserting that those codes described symptoms observed by Provider’s staff and did not constitute diagnosis codes for treatment purposes.[11] Provider further contended that Carrier wrongfully challenged medical necessity by referencing an adverse peer review as its reason for denial, terming the phrase peer review a shorthand way of asserting lack of medical necessity.[12] Provider also contended that Carrier waived its right to bring the extent-of-injury claim forward to MDR because it failed to list that reason on the EOB as required by the applicable administrative rules. In sum, Provider contended that the DRO’s decision was correct and that Carrier should be required to reimburse Provider for all charges at issue.

C. Applicable Law

An injured worker who sustains a compensable injury is entitled to all health care reasonably required by the nature of the injury as and when needed.[13] A carrier is not required to pay for medical treatment that does not address the compensable injury, even if both the compensable and non-compensable conditions are treated at the same time. A carrier may retrospectively review a bill and pay for or deny payment for medical benefits in accordance with the Act,[14] rules, and applicable Division fee and treatment guidelines. In general, a carrier may review the medical necessity and reasonableness of the health care that has been provided.[15] Specifically, a carrier may evaluate whether the provider has charged the appropriate fee if there are fee guidelines, ascertain a fair and reasonable reimbursement if no fee guidelines are in place, and also assess the medical necessity for the treatment, the extent of injury, and the relationship of the health care provided to the compensable injury.[16] However, if a carrier preauthorizes treatment, it is barred from thereafter disputing the medical necessity of that treatment.[17]

In denying payment, a carrier must inform the affected parties in a report that sufficiently explains the reasons for the reduction or denial of payment for health care services provided to the employee.[18] Rules adopted pursuant to the Act state that in its written ruling of payment of a claim, the EOB, a carrier must set forth the reasons for denying payment. One of those reasons may include an assertion the treatment is unrelated to the compensable injury.[19] The scope of an MDR is limited to these reasons presented to the requestor, i.e., a provider or injured employee, prior to the date the request for MDR was filed with the Division and the other party.[20]

III. DISCUSSION

Carrier’s assertion that Provider treated body areas other than the area of the lumbar spine that was injured or treated non-compensable conditions is not backed up by the medical records in this case. Although the treatment notes lack some specificity in the description of the exercises undertaken and the progress made, they nevertheless describe only treatments administered to the lumbar spine. Unlike an area-specific treatment such a facet or epidural injection or a surgical procedure on a specific spine level, physical therapy will necessarily involve body areas adjacent to the injured area. The only treatments that were applied to a body area other than the lumbar spine are the adjustments discussed above. These do not appear to have been a regular occurrence or pervasive practice, so the ALJ concluded they were incidental to the primary course of therapy to the lower back.

Although Carrier asserted that the treatment targeted other conditions, it did not demonstrate how therapy for degenerative conditions would differ from that for a lumbar strain and post-surgery rehabilitation, nor that Provider administered therapy inappropriate for the compensable injury. The credible medical evidence in the record showed treatment consistent with the terms of the preauthorization.

Although Carrier’s initial reliance on the diagnostic codes was reasonable, those codes are not a substitute for the description of the treatment itself provided in the SOAP notes. Provider failed to provide any explanation of why it chose to identify symptoms in areas of forms clearly labeled “diagnosis codes;” nevertheless, their descriptions are not the heart of the medical evidence in this case so are not dispositive. Carrier did not assert that Provider did not administer physical therapy as contemplated by the preauthorization.[21]

The issue of whether Carrier waived its right to bring forward its extent-of-injury challenge in the MDR proceeding, hence to SOAH, appeared to have been addressed by the DRO. The parties apparently supplied her with enough information about that claim to enable her to consider it in the decision-making process. The DRO did not discuss the waiver claim, suggesting that Provider did not raise the waiver claim at the MDR proceeding. Further, Provider cannot assert that it was surprised by Carrier’s argument regarding the extent of the compensable injury, as Carrier had provided Provider with a clear and detailed statement of its position in both preauthorization letters. Provider’s assertion that the use of a peer review usually signals a medical necessity argument has merit, as a peer review is frequently the basis of a medical necessity challenge. However, in this case, the peer review supports both the need for the treatment provided as well as recommending reducing the scope of the compensable injury. Thus, based on the facts in this case, the ambiguous peer review report is not sufficient to support a conclusion that Carrier waived its right to take the extent-of-injury claim to MDR.

On the basis of the above, the ALJ concludes that Carrier failed to carry its burden of proof to show that the Division’s MDR decision was in error. The preponderance of credible medical evidence demonstrated that Provider administered a course of physical therapy for Claimant’s lumbar strain and to aid in recovery from surgery. The effect of these conclusions is that the ALJ will order that Carrier reimburse Provider for the disputed services.

IV. FINDINGS OF FACT

  1. On ___, ____ (Claimant) injured his low back when he was bumped or hit by a forklift.
  2. Safety National Casualty Corporation (Carrier) was the responsible workers’ compensation insurance carrier.
  3. On August 22, 2005, Claimant underwent surgery to fuse the L4-L5 levels of his spine.
  4. Claimant did not undertake any physical therapy immediately after his surgery.
  5. In January 2005, Carrier initiated a challenge to findings on the extent of Claimant’s injury, seeking to exclude degenerative spine conditions and psychological issues from the scope of the compensable injury.
  6. In April 2005, R. A. Buczek, D.O., D.C., conducted a retrospective peer review of Claimant’s case and concluded that Claimant’s compensable injury was limited to a lumbar strain, that any psychological symptoms pre-dated the compensable injury, and that that no further diagnostic testing, chiropractic treatments, or physical medicine treatment were reasonable or necessary to treat the lumbar strain.
  7. Dr. Buczek recommended a course of facet injections to address the source of Claimant’s ongoing back pain, and up to 24 sessions of physical therapy to be followed by either a course of work hardening or a combination of work conditioning and a return-to-work program.
  8. On December 29, 2005, and February 2, 2006, Carrier preauthorized Dallas Multidisciplinary/Dallas Integrated Healthcare (Provider) to conduct up to 24 sessions of physical therapy between December 28, 2005, and March 6, 2006.
  9. In the preauthorization letters issued on December 29, 2006, and February 2, 2006, Carrier stated that a challenge to the extent of Claimant’s compensable injury was under way and identified the specific conditions or diagnoses it challenged, i.e., degenerative spinal conditions and psychological symptoms.
  10. In the two preauthorization letters, Carrier stated that, as no physical therapy had been undertaken following Claimant’s spinal fusion on August 22, 2005, physical therapy would be appropriate to maximize Claimant’s recovery from the surgical procedure.
  11. On July 17, 2006, the Texas Department of Insurance, Division of Workers’ Compensation (Division) issued a decision limiting the extent of Claimant’s injury to a lumbar strain.
  12. On several dates between January 9, 2006, and March 15, 2006, Provider conducted a physical therapy treatment program for Claimant that included assisted stretching and range of motion exercises for the lumbar spine, ultrasound and traction, chiropractic adjustment, and electrical stimulation of the lumbar spine.
  13. In connection with the other modalities, Provider’s staff adjusted Claimant’s L5 vertebra on January 9, 2006, and the C5-C6, T4, and L5 vertebrae on January 17 and 19, 2006. These are the only adjustments that identified the zones of the spine to which treatment was administered.
  14. Carrier did not object to treatments administered between March 6, 2006, the last date for which treatment was preauthorized, and March 15, 2006, the last date on which treatment was administered.
  15. The course of physical therapy administered by Provider treated Claimant’s lumbar strain and aided post-surgery rehabilitation.
  16. By March 2006, Claimant had the capacity to return to work with some restrictions.
  17. The course of physical therapy did not target body areas or parts other than the lumbar spine, inclusive of the L4-L5 spine level injured on ______, although other levels of Claimant’s spine may have been treated incident to the primary treatment.
  18. Provider sought reimbursement for a total of $4,298.61 for physical therapy provided between January 9, and March 15, 2006.
  19. Provider’s bills listed CPT codes, described on those bills as diagnosis or nature of illness or injury codes, which identified several degenerative spinal conditions. The bills did not list the diagnosis code for lumbar sprains and strains, i.e., CPT Code 847.2.
  20. After conducting a retrospective review of Provider’s bills, Carrier denied payment for all physical therapy services performed by Provider between January 9, 2006, and March 15, 2006.
  21. In the Explanations of Benefits (EOBs) it prepared, Carrier denied reimbursement for the physical therapy on the grounds that it was not eligible for payment based on a peer review and also that Provider had failed to provide enough information to enable it to adjudicate the claim.
  22. Provider timely requested medical dispute resolution.
  23. On June 20, 2008, the Division’s medical dispute resolution officer concluded that Carrier incorrectly denied reimbursement for physical therapy that had been provided under the terms of the preauthorization and that the grounds of lack of information was inapplicable to the circumstances.
  24. On July 18, 2008, Carrier requested a contested case hearing and the case was referred to the State Office of Administrative Hearings (SOAH).
  25. On August 5, 2008, the Division issued a notice of administrative hearing for a contested case at SOAH.
  26. The Notice of Hearing contained a statement of the time, place, and nature of the hearing; a statement of the legal authority and jurisdiction under which the hearing was to be held; a reference to the particular sections of the statutes and rules involved; and a short, plain statement of the matters asserted.
  27. ALJ Cassandra J. Church convened the hearing on October 22, 2008, in Austin, Texas, and the record closed that day.

V. 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. Lab. Code Ann. § 413.031.
  2. Adequate and timely notice of the hearing issued by the Division conformed to the requirements of Tex. Gov’t CodeAnn. §§ 2001.051 and 2001.052.
  3. Carrier was entitled to conduct a retrospective review of Provider’s medical bill, excluding the medical necessity for the preauthorized treatment, pursuant to Tex. Lab. Code Ann. §§ 133.2(8) and 133.240(b).
  4. Carrier had the burden of proving by the preponderance of the evidence that the medical dispute resolution decision on reimbursement was in error and that it properly denied reimbursement, pursuant to 28 Tex. Admin Code § 148.14(a).
  5. Based on the above Findings of Fact, Carrier failed to meet its burden of proof to show that Provider administered a course of physical therapy that was unrelated to the compensable injury, pursuant to 28 Tex. Admin. Code § 133.230(b)(3).
  6. Based on the above Findings of Fact and Conclusions of Law, Carrier failed to meet its burden of proof to show that it was entitled to deny Provider reimbursement for the disputed service.
  7. ORDER

IT IS THEREFORE, ORDERED that Safety National Casualty Corporation is required to reimburse Dallas Multidisciplinary/Dallas Integrated Healthcare for physical therapy services performed between January 9, 2006, and March 15, 2006, for Claimant ____.

Signed December 18, 2008.

CASSANDRA J. CHURCH
Administrative Law Judge
STATE OFFICE OF ADMINISTRATIVE HEARINGS

  1. Provider Ex. 2, p. 21.
  2. Provider Ex. 2, p. 17.
  3. Provider Ex. 1, pp. 17 – 20.
  4. Similar services were provided in other months in 2006, but they are not at issue here. Provider Exs. 2 and 4.
  5. Provider Ex. 2, pp. 8 – 58.
  6. Provider Ex. 2, pp. 13, 40, and 55.
  7. Carrier Ex. 2, p. 3.
  8. Provider Ex. 2, p. 35.
  9. Provider Ex. 1.
  10. Carrier Ex. 2.
  11. Provider Ex. 2, pp. 36, 47, 51.
  12. Carrier used denial code “270” for its objection to the treatment based on a peer review. Provider asserted that the proper ways to challenge the relatedness of treatment would have been using denial codes “E,” “W,” or the inclusion of an explanatory sentence.
  13. Tex. Lab. Code Ann. § 408.021.
  14. Tex. Lab. Code AnnTitle 5, Workers’ Compensation (the Act).
  15. Tex. Lab. Code Ann. § 133.2 (8).
  16. 28 Tex. Admin Code § 133.230(b).
  17. 28 Tex. Admin Code § 133.240(b).
  18. Tex. Lab. Code Ann § 408.027(e).
  19. 28 Tex. Admin. Code 133.240(e).
  20. 28 Tex. Admin Code § 133.307.d)(2)(B).
  21. Carrier apparently did not object to physical therapy administered between March 6, 2006, the last date of treatment authorized, and March 15, 2006, apparently the last date of actual treatment. The ALJ has assumed this was resolved between the parties before the medical dispute resolution.

DECISION AND ORDER

From June 26, 2007, through August 29, 2007, Petitioner, Texas Health, L.L.C., a CARF-accredited facility,[1] provided work hardening services to a workers’ compensation claimant. Respondent, Dallas National Insurance Company, determined that the treatment was not medically necessary. The amount in dispute is $6,228.80 for 11 visits in a four-week period and related functional capacity evaluations (FCEs).

Petitioner sought dispute resolution at the Texas Department of Insurance, Division of Workers’ Compensation (DWC), and an Independent Review Organization (IRO) determined that the disputed services were not medically necessary. Petitioner appealed the IRO’s decision and requested a hearing at the State Office of Administrative Hearings (SOAH). In this appeal, the Administrative Law Judge (ALJ) finds that Petitioner proved part of the program was medically necessary and orders partial reimbursement.

I.JURISDICTION, PROCEDURAL HISTORY, AND NOTICE

Notice and jurisdiction were not disputed and are discussed only in the Findings of Fact and Conclusion of Law. The hearing was conducted on October 6, 2008, before ALJ Sarah G. Ramos with attorney Matthew Lewis representing the Petitioner and attorney Jason A. Schmidt representing the Respondent. The hearing was adjourned and the record closed that same day.

II. DISCUSSION

A. Legal Standards

Petitioner’s burden of proof is by a preponderance of the evidence.[2] In addition, Petitioner is subject to the Official Disability Guidelines (ODG) adopted by the Commissioner and applicable to health care provided after May 1, 2007.[3] The ODG criteria for admission to a work hardening program are:

  1. Physical recovery sufficient to allow for progressive reactivation and participation for a minimum of four hours a day for three to five days a week.
  2. A defined return to work goal agreed to by the employer and employee:
    1. A documented specific job to return to, or
    2. Documented on-the-job training.
  3. The worker must be able to benefit from the program. Approval of these programs should require a screening process that includes file review, interview, and testing to determine likelihood of success in the program.
  4. The worker must be no more than two years past the date of injury. Workers that have not returned to work by two years post injury may not benefit.
  5. Work hardening programs should be completed in four weeks consecutively or less.

B. Background

The claimant sustained a work-related shoulder injury on ___, while rolling 200-300 pound drums. He subsequently experienced a constant shoulder ache, which worsened when he lifted, pulled, and drove. He also had parensthesias in the left fourth and fifth fingers. The symptoms worsened with cervical flexion.

Corticosteroid injections provided only transient relief. One surgeon who examined the claimant thought the problem was due to a brachial plexus upper and lower trunk injury with a partial rotator cuff tear, and another thought the problem was due to cervical spondylosis at C6- and C7-T1. The claimant had an initial FCE on May 24, 2007, which found the claimant could meet medium physical demands.[4] The claimant’s treating physician, John D. Botefuhr, D.C., referred the claimant to Petitioner for evaluation and treatment.

C. IRO Decision

In a decision dated June 18, 2008, the IRO determined that the work hardening program was not medically necessary based on several factors, including five FCEs billed during the 11 weeks of treatment and the fact that the claimant’s symptoms were aggravated by the program. Although the IRO noted that the claimant showed increases in functional capabilities, he still had work limitations and his pain levels improved only slightly. Further, the IRO determined that Petitioner was required to, but did not, clearly document the claimant’s job requirements for re-entry into his work as a ______.

D. Evidence

At the hearing, Petitioner waived its appeal except for three FCEs and 11 visits during four weeks. Phil Bohart, LPC, one of Petitioner’s principals and its clinical director, testified that, on June 26, 2007, he telephoned the employer to discuss the claimant’s work demands and the possibility of his returning to work. He was told the claimant possibly could return to his employment if he could meet specified job demands that included occasional lifting of 75 to 100 pounds and frequent lifting of 35 to 50 pounds. These are heavy lifting demands. The employer also told Mr. Bohart that light duty work or an alternate job was not available.[5]

The program was for four hours a day, three-to-five days a week. The claimant had FCEs on May 24, June 26, July 6, August 14, and August 29, 2007. Writing in support of Petitioner’s request, Bradley J. Eames, D.O., noted that the claimant had a job to return to with an agreed-upon vocational goal, was within two years of the date of injury when he was admitted, had FCE’s that showed he was not able to safely perform his job duties, had demonstrated psychosocial barriers that required a multidisciplinary approach to his care, and had a realistic chance to meet his job requirements within four weeks.[6] In addition, the claimant had not reached maximum medical improvement, and no doctor who saw the claimant said he was a surgical candidate.

E. Respondent’s Arguments

Respondent noted that the IRO (a board-certified pain management physician), a peer reviewer, and two doctors with Injury Management Organization, Inc., all agreed the program was not medically necessary. Further, the claimant had no intervening treatment between the May 24 and June 26, 2007 FCEs, so there was no reason the second FCE was required.

F. Petitioner’s Arguments

Petitioner argued that the issue is not whether the claimant actually benefited from the program. Rather, the issue is whether, at the commencement of the program, it appeared that the claimant would benefit from the program. Petitioner further noted that the four doctors who found work hardening was not medically necessary did not personally evaluate the claimant. One of the IMO doctors, Robert Honigsfeld, D.C., was under the mistaken impression that the employer had not been contacted with a written or verbal job description. Dr. Honigsfeld mistakenly thought the work may have required a medium demand level or that the employer might have been willing to accommodate the claimant’s return to work with restrictions.

The claimant’s progress was measured by his tolerance. Therefore, Petitioner asserted, the three FCEs were needed to determine the claimant’s capability at the beginning of the program, after seven days to measure how he was tolerating the program, and at the end of the program.

G. Decision

The ALJ finds that Petitioner met its burden of proof as to the first four weeks of treatment. The claimant was not physically able to meet his work requirements prior to entering the program and had the possibility of returning to work if he could meet heavy physical demands. The program fell within two years of his injury date, and the record includes psychological assessments that showed he could have benefited from the multidisciplinary approach to his care.

However, the ALJ does not agree with Petitioner that three FCEs were needed. Prior to beginning Petitioner’s program, the claimant had an FCE on May 24, 2007. The claimant received no treatment between that initial FCE and the one Petitioner performed on June 26, 2007; thus, another FCE should not have been needed on that date. The last two FCEs (August 14 and 29, 2007) were provided past the allowable four weeks of treatment. Therefore, the ALJ finds that Respondent should reimburse Petitioner only for the July 6, 2007 FCE.

III. FINDINGS OF FACT

  1. The claimant sustained a work-related _____ on ____, while rolling 200-300 pound drums.
  2. The claimant subsequently experienced a constant shoulder ache, which worsened when he lifted, pulled, and drove, and he had parensthesias in the left fourth and fifth fingers. His symptoms worsened with cervical flexion.
  3. Corticosteroid injections provided only transient relief.
  4. Prior to beginning Petitioner’s program, the claimant had an initial FCE on May 24, 2007, which found the claimant could meet medium physical demands.
  5. Petitioner conducted FCEs on the claimant on June 26, July 6, August 14, and August 29, 2007.
  6. Between May 24, 2007, and June 26, 2007, the claimant had no intervening treatment.
  7. The FCEs on August 14 and 29, 2007, were conducted more than four weeks after the claimant began Petitioner’s work hardening program.
  8. The claimant’s treating physician referred the claimant to Petitioner for evaluation and treatment.
  9. When the claimant began Petitioner’s work hardening program, he had not reached maximum medical improvement, and no doctor who saw the claimant said he was a surgical candidate.
  10. Before the claimant began the work hardening program, his employer confirmed that he possibly could return to his employment if he could meet specified job demands that included occasional lifting of 75 to 100 pounds and frequent lifting of 35 to 50 pounds, which are heavy lifting demands.
  11. The employer had no light duty work or an alternate job available for the claimant.
  12. The interdisciplinary nature of the work hardening program was necessary to address the claimant’s physical and psychological issues and achieve the goal of returning the claimant to work.
  13. The claimant was within two years of the date of injury when he began the program.
  14. The claimant had a realistic chance to meet his job requirements within four weeks.
  15. The first four weeks of the work hardening program were medically necessary for the claimant.
  16. The work hardening program did not meet the ODG after the first four weeks; therefore, treatment after that time was not medically necessary.
  17. Respondent determined that the program was not medically necessary based upon peer review and denied reimbursement.
  18. Petitioner submitted the matter to DWC and it was reviewed by an IRO, which ruled in Respondent’s favor.
  19. Petitioner appealed the IRO decision and requested a hearing before SOAH.
  20. Notice of the SOAH hearing was sent to the parties on August 5, 2008.
  21. The notice included the time, place, and nature of the hearing; the legal authority and jurisdiction under which the hearing was to be held; a reference to the particular sections of the statutes and rules involved; and a short, plain statement of the matters asserted.
  22. The SOAH hearing was conducted on October 6, 2008, before ALJ Ramos, with representatives of both parties participating. The hearing was adjourned and the record closed that same day.

IV. CONCLUSIONS OF LAW

  1. SOAH has jurisdiction over this proceeding, including the authority to issue a decision and order, pursuant to Tex. Lab. Code Ann. § 413.031(k) and Tex. Gov’t Code Ann. ch. 2003.
  2. Adequate and timely notice of the hearing was provided in accordance with Tex. Gov’t Code Ann. §§ 2001.051 and 2001.052.
  3. Petitioner has the burden of proof in this proceeding by a preponderance of the evidence.
  4. Petitioner is subject to the ODG adopted by the Commissioner of Insurance and applicable to health care provided after May 1, 2007. 28 TAC § 137.100.
  5. Pursuant to Tex. Lab. Code Ann. § 413.031, Respondent should be required to reimburse Petitioner for the first four weeks of the work hardening program and the FCE conducted on July 6, 2007.

ORDER

It is, therefore, ordered that Respondent shall reimburse Petitioner for the work hardening program provided to the claimant from June 26, 2007 through July 24, 2007, and the FCE provided on July 6, 2007.

Signed December 5, 2008.

SARAH G. RAMOS
Administrative Law Judge
STATE OFFICE OF ADMINISTRATIVE HEARINGS

  1. “CARF” stands for “Commission on Accreditation of Rehabilitation Facilities.” CARF-accredited work hardening programs are exempt from preauthorization requirements. 28 Tex. Admin. Code (TAC) § 134.600(a)(4).
  2. Although 28 TAC § 148.14(b) states that the IRO’s decision is to be given presumptive weight, prior SOAH decisions have found otherwise. See, e.g.,J.H. v. Texas Workers’ Compensation Commission and Insurance Company of the State of Pennsylvania, Docket No. 453-03-0186.M2 (December 16, 2002), and American Zurich Insurance Company v. Texas Department of Insurance, Division of Workers’ Compensation & Jack Barnett, D.C., Docket No. 453-04-5005.P1.
  3. 28 TAC § 137.100.
  4. P. Ex. 1 at 310.
  5. P.Ex. 1 at 213.
  6. P. Ex. 1 at 401.

DECISION AND ORDER

I. INTRODUCTION

Gabriel Gutierrez (Petitioner and Provider) appealed the decision of the Medical Dispute Resolution Division of the Texas Department of Insurance, Division of Workers’ Compensation (the Division) regarding services provided by Petitioner to a workers’ compensation claimant, ___ (Claimant) from March 14, 2006, through April 28, 2006. The Medical Review Division (MRD) accepted the Independent Review Organization’s (IRO) decision that week three through six of treatments were medically unnecessary. The Provider appealed the IRO’s decision. The Administrative Law Judge (ALJ) finds that the Provider met its burden of proof and weeks three through six were medically necessary.

II. PROCEDURAL HISTORY

Notice and jurisdiction were not contested and are discussed only in the Findings of Fact and Conclusions of Law. The hearing for this case convened on October 13, 2008, at the State Office of Administrative Hearings, 300 W. 15th St., 4th Floor, Austin, Texas, before ALJ Travis Vickery. Attorney Phillip Orth represented the Petitioner. Attorney Robert Josey represented Liberty Mutual Fire Insurance Company (Respondent). Written closing arguments were submitted and the record closed on November 7, 2008, after both parties had an opportunity to file briefs and reply briefs.

III. ARGUMENT AND ANALYSIS

The Claimant suffered a workplace injury on ____. He then underwent various treatments over a two-and-a-half year period. The Claimant was referred to the Provider, who performed a functional capacity evaluation (FCE) on February 21, 2006. A psychosocial assessment was performed on February 26, 2006. The Provider treated the Claimant with work hardening from March 14, 2006, through April 28, 2006. A second FCE was conducted on May 1, 2006, after the completion of work hardening.

Respondent denied reimbursement for the services as medically unnecessary. Provider submitted the denial to the Division for review. The Division issued a decision finding that week one and two were medically necessary, but weeks three through six were not. Provider is the sole appellant, and as a result, only weeks three through six are in dispute (March 30, 2006, through April 28, 2006) (Disputed Services). The Provider appealed and the Disputed Services total $10,525.[2]

Respondent did not appeal the IRO’s determination that the first two weeks of work hardening were medically necessary. That finding shall remain undisturbed by the ALJ. As a result, the issue here is not whether work hardening was initially medically necessary, but whether it should have been limited to two weeks of treatment, or the full six weeks that Claimant received.

At the time that the Claimant presented to the Provider, he had been out of work for approximately two-and-a-half years as a result of a tree limb falling on his lower right leg and fracturing his ankle and talus. Over the course of those two-and-a-half years, Claimant underwent a number of procedures and courses of therapy, including two surgeries, the latest occurring in September 2005, and complications including a post-surgical infection. Thereafter, he was referred to the Provider by Juan Galvan, D.C., who recommended six weeks of therapy.

The Claimant presented to the Human Resource Performance & Rehabilitation Institute (HRPRI), where the Provider is employed. Although the Claimant’s employment involved a heavy physical demand level, the first FCE revealed that the Claimant was sedentary and unfit for even light duty work. The psychosocial evaluation determined that he was an appropriate candidate for work hardening, that there were non-physical barriers to the Claimant’s ability to return to work, that he was mildly depressed and that he considered himself completely disabled.[3] Taking all of this into consideration, it seems ambitious to expect the Claimant to achieve the goals of work hardening in two weeks of therapy. The extensive nature of work hardening assumes treatment of some duration to achieve a level of success.

Although the Respondent raises a number of valid issues with the Petitioner’s evidence of Claimant’s progress, the Petitioner established that the final four weeks of work hardening were medically necessary. Respondent accurately notes that all of the progress logs are formulaic and nearly identical.[4] The Work Hardening Performance, Impression, Barrier(s) to RTH and Short Term Functional Goal(s) Chart from March 29, 2006 is also very similar in language to the same chart for April 28, 2006.[5] Nevertheless, a comparison of the progress logs and charts documents Claimant's progress. And although the Work Hardening Program & Progress Table may lack depth, it reflects improvement in every category over the last four weeks.[6] Respondent also notes discrepancies in Claimant’s reported progress between the Work Hardening Program & Progress Table and the May 1, 2006 FCE. Nevertheless, the final FCE reflects that the Claimant “increased in all parameters from a Sedentary to a Light Functional Capacity.”[7] In particular, the effect of pain on the Claimant's functional ability was reduced, his ability to negotiate pain improved, his lifting ability increased by 15 pounds, and he increased sustained postural tolerances from 15 minutes to 60 and 75 minutes. Although the Claimant did not improve to a heavy physical demand level, he was at least employable at the light duty level - one of the program’s goals.[8]

As reflected in the Findings of Fact and Conclusions of Law, this decision finds that the Provider met its burden of proof as to the medical necessity of the Disputed Services. The MRD’s decision that the last four weeks of work hardening were medically unnecessary is overruled.

IV. FINDINGS OF FACT

Procedural History and Notice

  1. Gabriel Gutierrez (Petitioner and Provider) appealed the decision of the Medical Dispute Resolution Division of the Texas Department of Insurance, Division of Workers’ Compensation (Division) regarding services provided by Petitioner to a workers’ compensation claimant, ___ (Claimant) from March 14, 2006, through April 28, 2006, and two Functional Capacity Evaluations (FCE).
  2. Based on the Independent Review Organization’s (IRO) decision, the Medical Review Division (MRD) determined that two weeks of work hardening and one FCE were medically necessary.
  3. Based on the IRO’s decision, MRD denied the Provider reimbursement for four weeks of work hardening and one FCE as medically unnecessary.
  4. The Provider timely requested a contested case hearing.
  5. Notice of the hearing was sent to the parties on September 12, 2008.
  6. The notice contained a statement of the time, place, and nature of the hearing; a statement of the legal authority and jurisdiction under which the hearing was to be held; a reference to the particular sections of the statutes and rules involved; and a short, plain statement of the matters asserted.
  7. Upon the request of Liberty Mutual Fire Insurance Company (Respondent), continuances were granted, and by order issued September 22, 2008, the parties were provided notice of the new hearing date.
  8. The hearing for this case convened on October 13, 2008, at the State Office of Administrative Hearings, 300 W. 15th St., 4th Floor, Austin, Texas. Attorney Phillip Orth represented the Provider and attorney Robert Josey represented the Respondent.
  9. The parties filed post-hearing briefing and the record closed on November 7, 2008.

Background and Analysis

  1. On _____, the Claimant suffered an injury at his job, when a tree limb fell on his lower right leg and fractured his ankle and talus.
  2. On the date of the compensable injury, the Claimant’s employer had workers’ compensation insurance with the Respondent.
  3. Claimant received treatment for his injuries, including two surgeries. Thereafter, he was referred to the Provider by Juan Galvan, D.C., who recommended six weeks of therapy.
  4. The Claimant first presented to the Provider on February 21, 2006. That day, the Provider conducted an FCE on the Claimant, which identified him as a candidate for six weeks of work hardening.
  5. On February 26, 2006, Monie G. Smith, MA, L.M.F.T., conducted a Work Hardening Assessment Psychosocial History and determined that the Claimant was an appropriate candidate for work hardening.
  6. The Provider administered work hardening to the Claimant from March 14, 2006, through April 28, 2006. The work hardening services were rendered under CPT codes 97546, 97545, and the FCEs were rendered under CPT code 97750.
  7. Based on the IRO decision as adopted by the MRD, the Respondent paid for ten units of work hardening and one FCE.
  8. The disputed services consist of 20 units of work hardening, rendered from March 30, 2006, through April 28, 2006, and one FCE (Disputed Services).
  9. One of the goals of work hardening was to move the Claimant from the status of sedentary and unemployable to the capacity to seek employment in a light to medium duty position.
  10. After the completion of work hardening, the May 1, 2006 FCE reflects that the Claimant “increased in all parameters from a Sedentary to a Light Functional Capacity.”[9] Compared to the result of the February 21, 2006 FCE, the effect of pain on the Claimant’s functional ability was reduced; the Claimant’s ability to negotiate pain had improved; the Claimant's lifting ability increased by 15 pounds; and the Claimant increased sustained postural tolerances from 15 minutes to between 60 and 75 minutes. The Claimant was employable at the light duty level.
  11. The Disputed Services were medically necessary.

V. CONCLUSIONS OF LAW

  1. The Texas Workers’ Compensation Commission has jurisdiction over this matter pursuant to Tex. Lab. Code Ann. § 413.031.
  2. The State Office of Administrative Hearings has jurisdiction over this proceeding, including the authority to issue a decision and order, pursuant to Tex. Lab. Code Ann. § 413.031 and Tex. Gov’t Code Ann. ch. 2003.
  3. Adequate and timely notice of the hearing was provided in accordance with Tex. Gov’t Code Ann. § 2001.052.
  4. The Provider had the burden of proof in this matter, pursuant to 28 Tex. Admin. Code § 148.21(h).
  5. The Provider met its burden to establish the medical necessity of the Disputed Services.
  6. Pursuant to Tex. Lab. Code Ann. § 408.021, the Provider’s work hardening treatment, rendered to the Claimant from March 30, 2006, through April 28, 2006, and one FCE, were medically necessary.

ORDER

IT IS, THEREFORE, ORDERED that the Respondent is required to reimburse the Provider for work hardening rendered to the Claimant from March 30, 2006, through April 28, 2006, and one Functional Capacity Evaluation. In all other respects, MRD’s decision is upheld.

Signed December 1, 2008.

TRAVIS VICKERY
Administrative Law Judge
STATE OFFICE OF ADMINISTRATIVE HEARINGS

  1. Petitioner's Ex.1 at 23-26.
  2. Id. at 382-386.
  3. Id. at 85-144.
  4. Id. at 447-451 (March 29, 2006), 399-403 (April 28, 2006).
  5. Id. at 404.
  6. Id. at 172.
  7. Id. at 171-184 and 1-4.
  8. Id. at 172.

DECISION AND ORDER

On April 11, 2008, before the scheduled hearing in this case, Respondent Liberty Mutual Insurance Company (LMIC) filed its Motion to Dismiss for Lack of Jurisdiction. The Administrative Law Judge (ALJ) concludes that motion should be granted, this case should be dismissed with prejudice from the docket of the State Office of Administrative Hearings (SOAH) and the hearing on the merits should be canceled.

I. PROCEDURAL HISTORY

This case was referred to SOAH on January 15, 2008, and initially set for a hearing to be held on February 27, 2008. The hearing was continued to April 16, 2008. On April 11, 2008, LMIC filed its motion to dismiss. Because of a family emergency affecting North Texas Rehabilitation Center’s (NTRC’s) representative, the hearing was again continued, to a date to be determined. The hearing date ultimately was set at October 9, 2008.

In the second order of continuance, the ALJ established a deadline of May 22, 2008, for NTRC to respond to the motion to dismiss. He later extended that deadline to September 5, 2008. No response was filed. In Order No. 5, which set the most recent hearing date, the ALJ admitted into evidence Exhibits A and B, which were attached to LMIC’s motion.

I.DISCUSSION

LMIC Exhibit A is the Independent Review Organization (IRO) decision at issue in this case. That decision was issued and sent to the parties on November 7, 2007. NTRC received the decision on that date, as shown by the fax stamp on the copy of the decision it filed with SOAH and by 28 Tex. Admin. Code (TAC) § 102.5(d). That rule states:

For purposes of determining the date of receipt for those written communications sent by the Commission which require the recipient to perform an action by a specific date after receipt, unless the great weight of evidence indicates otherwise, the Commission shall deem the received date to be the earliest of: five days after the date mailed via United States Postal Service regular mail; the first working day after the date the written communication was placed in a carrier's Austin representative box; or the date faxed or electronically transmitted

LMIC Exhibit B is NTRC’s appeal and request for a SOAH hearing regarding that decision. That request was filed December 12, 2007.

Under 28 Tex. Admin. Code (TAC) § 148.3(a)(2), the deadline for NTRC to file its appeal of the IRO decision was twenty days after receipt of that decision, which was November 27, 2007. The request for hearing was filed after that date. Therefore, as argued by LMIC, this case should be dismissed pursuant to 1 TAC §155.56(b) (2).

I.FINDINGS OF FACT

  1. The Independent Review Organization (IRO) decision at issue in this case was issued and sent to the parties November 7, 2007.
  2. North Texas Rehabilitation Center (NTRC) received the IRO decision on November 7, 2007.
  3. NTRC’s appeal and request for a SOAH hearing regarding that decision was filed December 12, 2007.

I.CONCLUSIONS OF LAW

  1. Under 28 Tex. Admin. Code (TAC) § 148.3(a) (2), the deadline for NTRC to file its appeal of the IRO decision was November 27, 2007.
  2. NTRC’s appeal was not timely filed.
  3. This case should be dismissed pursuant to 1 TAC §155.56(b) (2).

ORDER

North Texas Rehabilitation Center’s request for hearing is dismissed with prejudice pursuant to 1 Tex. Admin. Code §155.56(b) (2). The hearing on the merits, previously set for October 9, 2008, is canceled.

Signed October 2, 2008.

HENRY D. CARD
Administrative Law Judge
STATE OFFICE OF ADMINISTRATIVE HEARINGS

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