Opinion
W.C. No. 4-561-605.
March 30, 2005.
FINAL ORDER
The claimant seeks review of an order of Administrative Law Judge Klein (ALJ). The claimant contends the ALJ erred in finding that the need for medical treatment was caused by the claimant's post-injury activities. The claimant also contends the ALJ erred in finding the respondents are not liable for penalties based on violation of the rule of procedure concerning prior authorization for medical treatment, and for dictating medical treatment in violation of § 8-43-503(3), C.R.S. 2004. We affirm the denial of medical benefits and remand for entry of a new order concerning penalties.
The claimant sustained a compensable back injury on November 5, 2002, and on December 18, 2002, underwent surgery to repair a ruptured disc at L3-4. By January 9, 2003, the surgeon reported the claimant had no complaints and was increasing his activities.
In September 2003 the claimant was examined by Dr. Williams, an authorized treating physician (ATP). The claimant reported morning stiffness and pain when rolling over in bed, and he was given a prescription for physical therapy. In December 2003 the claimant reported that his low back pain no longer resolved by the end of the day and he could not ski or "do sports." The ATP reported the claimant had ongoing pain, was not stabilized and needed a new MRI of the low back.
On January 6, 2004, after the MRI, the ATP reexamined the claimant and referred him to Dr. Gronseth "for a second opinion in consultation about what else might be considered at this point." On January 12, 2004, the insurance adjuster wrote to the ATP and expressed concern, in light of information that the adjuster received from the employer, that the claimant's post-surgical recreational activities might be the cause of his symptoms. On January 13, 2004, the employer authored a letter to the adjuster stating that to his knowledge the claimant skied, biked and climbed several fourteen thousand foot mountains "during the past year." On January 22, 2004, the adjuster forwarded the employer's letter to the ATP, and requested that the ATP reexamine the claimant and address the cause of his symptoms before ordering a referral to another physician.
The ATP did not respond to the adjuster's inquiries until May 18, 2004, and only after an April 30, 2004, inquiry from the respondents' counsel. On May 18 the ATP expressed the view the claimant's symptoms are related to the industrial injury.
Meanwhile, on January 29, 2004, a second reading of the January MRI indicated the presence of mild facet arthropathy at L3-4 and "more significantly at L5-S1." On January 30, 2004, the ATP again examined the claimant and referred him to Dr. Siegel "for consideration of whether or not facet joint arthritis could contribute and whether or not a thermal procedure on his disc might be of benefit." The referral to Dr. Siegel was forwarded to the adjuster on March 4, 2004, but the ALJ found the adjuster did not "independently advise" the claimant that Siegel was not authorized until June 11, 2004.
The respondents obtained a medical records review by Dr. Brodie. In a report dated June 24, 2004, Dr. Brodie opined as a matter of medical probability that the worsening of the claimant's back symptoms resulted from "axial loading forces" caused by the claimant's post-surgical "recreational and sports activities."
Crediting the medical opinion of Dr. Brodie over that of the ATP, and based on the appearance of "new symptoms" in September 2004 and "new pathology" at L4-5 L5-S1, the ALJ found the claimant's need for treatment was caused by the claimant's "extraordinary" recreational activities after surgery, not the November 2002 industrial injury. Consequently, the ALJ denied the claimant's request for the prescribed medical examination by Dr. Siegel.
The ALJ also denied the claim for penalties under § 8-43-304(1), C.R.S. 2004, based on an alleged violation of Rules of Procedure XVI (I) (J), 7 Code Colo. Reg. 1101-3 at 78-79, governing prior authorization for medical treatment. The ALJ ruled that the referrals to Dr. Gronseth and Dr. Siegel did not require prior authorization, and therefore the rules of procedure don't apply to the ATP's requests for authorization. The ALJ also ruled that because the insurer's' actions amount to a denial of medical benefits § 8-43-401(2)(a), C.R.S. 2004, provides a specific penalty for the alleged conduct and general penalties under § 8-43-304(1) are not available.
The ALJ also denied the claim for penalties based on the argument that the insurer's refusal to agree to the referral amounted to an attempt to "dictate" to the ATP the "type or duration of treatment" in violation of § 8-43-503(3). The ALJ concluded that "questioning the medical relatedness" of proposed treatment does not equate to an attempt to "dictate" treatment. The ALJ also found the insurer's position concerning causation was reasonable and it succeeded in proving the need for the referrals was not caused by the injury.
I.
On review, the claimant disputes the ALJ's findings and conclusion that the claimant's worsened back symptoms and consequent need for referrals to Dr. Gronseth and Dr. Siegel were caused by his post-surgery recreational activities rather than the industrial injury. We perceive no error.
As a general matter, even after the filing of a general admission for medical benefits, the respondents retain the right to dispute the cause of the need for continuing treatment. Snyder v. Industrial Claim Appeals Office, 942 P.2d 1337 (Colo. pp. 1997). The determination of whether the need for treatment was caused by the industrial injury or a subsequent intervening cause is one of fact for determination by the ALJ. Owens v. Industrial Claim Appeals Office, 49 P.3d 1187 (Colo.App. 2002).
Because the issue is one of fact, we must uphold the ALJ's resolution if supported by substantial evidence in the record. Section 8-43-301(8), C.R.S. 2004. Wal-Mart Stores, Inc. v. Industrial Claims Office, 989 P.2d 251 (Colo.App. 1999). This standard of review requires us to defer to the ALJ's resolution of conflicts in the evidence, credibility determinations, and plausible inferences drawn from the record. This standard applies with equal force to lay and expert testimony. Cordova v. Industrial Claim Appeals, 55 P.3d 186 (Colo.App. 2002). Further, the ALJ need not address every piece of evidence if the bases of the order are clear from the findings, and evidence not addressed was presumably rejected as not persuasive. Magnetic Engineering, Inc. v. Industrial Claim Appeals Office, 5 P.3d 385 (Colo.App. 2000).
The claimant takes issue with numerous findings of fact concerning causation. The claimant disputes finding 4, which states the claimant was not seen for back pain between January 2003 and September 2003. The claimant points out that he was seen by the ATP on February 21. In light of the "mild" symptoms reported on February 21, and the significant gap in treatment between February and September 2003, any error in this regard was harmless. The ALJ implicitly rejected the claimant's testimony that he discussed his symptoms with various providers after January 2003.
The claimant disputes finding 6 in which the ALJ found the medical records do not support the claimant's contention that his activities after surgery had the "blessing" of his physicians. The claimant cites "booklets" which were allegedly given to him by the treating physicians. (Exhibit 21). However, the ALJ was apparently unpersuaded that the "booklets" were given to the claimant by the treating physicians, or that the physicians were aware of the extent and nature of the claimant's activities. In the absence of express medical documentation that the claimant's activities were approved, and because Exhibit 21 could be viewed as something the claimant obtained from a web site rather than his physicians, we cannot say the ALJ erred by implicitly discrediting the claimant's testimony concerning the "booklets."
The ALJ's finding that the claimant's activities were "extraordinary" constitutes a plausible inference from the record. In particular, the employer's January 13 letter to the adjuster supports this inference. The clear import of the letter is that some of these activities, including skiing, began shortly after surgery, and some occurred in the summer before the claimant's symptoms began to worsen.
The claimant's argument notwithstanding, the respondents' admission that the claimant sustained a compensable injury did not require them to concede that all subsequent treatment is causally related to the injury. Snyder v. Industrial Claim Appeals Office, supra.
The claimant's remaining arguments are factual in nature and without merit. The report of Dr. Brodie provides substantial evidence to support the ALJ's finding that the recreational activities were the cause of the need for treatment. While the report contains a few errors in describing dates, the effect of those errors on the doctor's credibility was a matter for the ALJ. Further, the ALJ's analysis of the medical records, including the development of the facet arthropathy, provides support for the order. The fact that other interpretations of the evidence and other credibility findings were possible affords no basis for relief on appeal. Wilson v. Industrial Claim Appeals Office, 81 P.3d 1117 (Colo.App. 2003) (when considering factual finding evidence must be viewed in light most favorable to the prevailing party).
II.
The claimant next contends the ALJ erred in denying his claim for penalties based on violation of the rules of procedure governing prior authorization. The claimant argues that, contrary to the ALJ's ruling, the insurer was required to respond in writing to the request to prior authorization even though the claimant was not obligated to request prior authorization. We conclude the matter must be remanded for entry of a new order on this issue.
Under § 8-43-304(1), violation of a rule of procedure may result in penalties because such violation may demonstrate a party has failed to take an action lawfully enjoined by the Director of the Division of Workers' Compensation (Director) within the time allotted. Human Resource Co. v. Industrial Claim Appeals Office, 984 P.2d 1194 (Colo.App. 1999). However, no penalty may be imposed unless the insurer's conduct was objectively unreasonable in the sense that it was not predicated on a rational argument based in law or fact. Jiminez v. Industrial Claim Appeals Office, ___ P.3d ___ (Colo.App. No. 02CA2283, September 11, 2003); Diversified Veterans Corporate Center v. Hewuse, 942 P.2d 1312 (Colo.App. 1997).
Here, the ALJ concluded there was no violation of a rule because the ATP was not required to obtain prior authorization for the referrals to Dr. Gronseth and Dr. Siegel. However, we have previously held that under Rule of Procedure XVI (I)(2), 7 Code Colo. Reg. 1101-3 at 77, an insurer must respond to " all providers requesting prior authorization within seven days (7) business days," regardless of whether the particular type of treatment prescribed requires the provider to obtain prior authorization under Rule of Procedure XVI (I)(1). (Emphasis added). The rationale for our holding is fully set forth in Timko v. Cub Foods, W.C. No. 3-969-031 (December 26, 2003), and the rationale of that decision is adopted herein as if fully set forth. (Copy of Timko decision in file). We add that since the Timko decision was issued the Director has revised Rule XVI effective January 1, 2005. However, the Director did not alter Rule XVI (I)(2). Thus, we infer that the Director has endorsed our interpretation of the rule as exemplified by Timko. Cf. Spanish Peaks Mental Health Center v. Huffaker, 928 P.2d 741 (Colo.App. 1996) (if court interprets a statute and the legislature revisits the statute without changing the language interpreted by the court, it is presumed the legislature approved the court's interpretation).
The respondents assert that Timko was wrongly decided because requiring the insurer to respond to a request for prior authorization in situations where prior authorization is not mandated would encourage providers and claimants to file requests in every case in hopes of triggering penalties. We doubt the logic of this reasoning because it seems improbable that physicians and claimants will, in every case, wish to delay medical treatment by requesting prior authorization on the mere hope of triggering a penalty. Neither do we agree with the assertion that the ruling will "frustrate the system and vitiate the efficient expediting of valid requests." If a request for prior authorization is deemed valid, the insurer may simply grant the request in writing within the allotted time. If, however, the insurer intends to contest a request for prior authorization for treatment, as was the case here, then responding promptly in accordance with the Rule XVI (J) will promote prompt dispute resolution. See Rule of Procedure XVI (J)(3). If the insurer does not respond to an optional request for prior authorization the issue may languish.
We also disagree with the respondents' assertion that the ALJ found that the evidence does not establish that prior authorization was denied. The ALJ noted the adjuster sent two letters to the ATP stating that a referral would not be approved unless the ATP met with the claimant and addressed the causation issue. In any event, the issue is whether the insurer complied with the applicable rules and, if so, when. The ALJ's order does not adequately address those questions.
We also reject the respondents' assertion that the Rule XVI (I)(2) is inapplicable as a matter of law because the provider did not submit a "completed request" for prior authorization as required by Rules XVI (I)(2) and (I)(5). Rule (I)(5) requires the provider to "explain the medical necessity of the services requested and provide relevant supporting medical documentation." As the respondents note, in Cross v. Microglide Inc., W.C. No. 4-355-764 (September 2, 2003), aff'd. Cross v. Industrial Claim Appeals Office, (Colo.App. No. 03CA1807, October 7, 2004), we held that two prescriptions for "essential services" were not sufficient "completed requests" to trigger the response requirements of Rule (I)(2). However, our order and the opinion of the court indicate that the question of whether there was a "completed request" is ordinarily one of fact dependent on the particular circumstances of the case. Here, the ATP's reports of January 6 and January 30, 2004, are substantially more detailed than the scripts in Cross, and could support a finding that there was a "completed request" for prior authorization. On remand, the ALJ shall determine whether, as a matter of fact, the ATP submitted a "completed request" for prior authorization so as to trigger the response requirements.
The ALJ also concluded that penalties may not be imposed for violation of the prior authorization rules because a § 8-43-401(2)(a) provides a specific penalty for willful delays in the payment of "medical benefits." However, in Pena v. Industrial Claim Appeals Office, ___ P.3d ___ (Colo.App. No. 03CA0387, November 18, 2004), the court held that § 8-43-401(2)(a) does not apply unless the claimant has submitted a "bill" for medical treatment which the insurer then refuses to pay. We are bound by published court decisions unless modified or reversed. C.A.R. 35(f). Thus, § 8-43-401(2)(a) does not provide a specific penalty for failure to grant prior authorization, and general penalties under § 8-43-304(1) are available for the alleged violation. In light of Pena, we need not consider whether a transgression of the prior authorization rules may be penalized under § 8-43-304(1) as the violation of an "order" without regard to the limitations of § 8-43-401(2)(a). See Holliday v. Bestop, Inc., 23 P.3d 700 (Colo. 2001); Spracklin v. Industrial Claim Appeals Office, 66 P.3d 176 (Colo.App. 2002) (rules are "orders" for purposes of general penalty statute); Giddings v. Industrial Claim Appeals Office, 39 P.3d 1211 (Colo.App. 2001) ("gravamen test" overruled and penalties not limited to § 8-43-401(2)(a) if insurer violates an "order" to pay medical benefits).
Finally, the fact that the ALJ found that the need for medical treatment is not related to the industrial injury, and that the insurer acted reasonably in defending on this basis, does not vitiate the need to determine whether it violated the rule and acted unreasonably in doing so. The rules governing prior authorization are procedural, and the fact the respondents ultimately prevailed on the merits would not excuse their failure to comply with the Director's regulations for contesting requests for prior authorization.
III.
Finally, the claimant contends the ALJ erred in finding the insurer's conduct did not violate § 8-43-503(3) because it "dictated" the type or duration of treatment. We are not persuaded.
First, the ALJ determined the insurer did not dictate treatment, and hence violate the Act for purposes of § 8-43-304(1), by contesting the cause of the claimant's need for treatment. We agree with the ALJ that a good faith contest on the issue of an intervening cause of the need for treatment does not constitute a violation of § 8-43-503(3) because, even after a general admission is filed, respondents remain free to contest the cause of the need for ongoing treatment. Hanna v. Print Expediters, Inc., 77 P.3d 863, 866 (Colo.App. 2003) (concerning respondents' right to contest compensability of and need for treatment after general award of ongoing medical benefits); Snyder v. Industrial Claim Appeals Office, supra; Halford v. Winter Park Resorts, W.C. No. 4-577-620 (September 13, 2004). Admittedly, there is dictum in Pena v. Industrial Claim Appeals Office, supra, suggesting that a violation of § 8-43-503(3) might occur if an insurer, which has filed a general admission of liability for medical benefits, unilaterally refuses to pay for medical treatment concerning which there is no requirement for prior authorization, and which has not been challenged before a Medical Utilization Review (MUR) panel. Slip. Op. at 11-12, 14. However, the Pena decision does not discuss the long line of cases, including Snyder and Hanna, which hold that the respondents are under no obligation to pay for treatment if they have a reasonable basis for contesting causation, without regard to the filing a general admission of a request for MUR. In particular, we note that MUR is not the exclusive method for evaluating the reasonableness and necesssity for medical treatment, it is merely an alternative to formal litigation. See § 8-43-501(2)(e), C.R.S. 2004.
Moreover, the ALJ found the respondents acted reasonably in contesting the causation issue, and ultimately prevailed. The record supports this determination because the respondents prevailed on the merits. Therefore, no penalty may be imposed because the respondents had a rational argument based in law and fact that they are not liable for the benefits. Jiminez v. Industrial Claim Appeals Office, supra. IT IS THEREFORE ORDERED that the ALJ's order dated September 2, 2004, is set aside insofar as it denied penalties for violation of the rules of procedure governing prior authorization. On this issue, the matter is remanded for entry of a new order consistent with the views expressed herein. A new hearing is not authorized, and we should not be understood as expressing any opinions concerning the underlying factual issues.
IT IS FURTHER ORDERED that the ALJ's order is otherwise affirmed.
INDUSTRIAL CLAIM APPEALS PANEL
____________________ David Cain
____________________ Kathy E. Dean
Ryan K. Radway, Steamboat Springs, CO, Letson Enterprises, Inc., Steamboat Springs, CO, Fire Insurance Exchange, c/o Jackie Slade, Farmers Insurance Group, Denver, CO, William C. Hibbard, Esq., Steamboat Springs, CO, (For Claimant).
Michael A. Perales, Esq. and T. Paul Krueger, II, Esq., Denver, CO, (For Respondents).