California Second District Court of Appeal Finds 30-Day Provision for IMR Decisions Directory, Not Mandatory

On June 22, 2016, California’s Second District Court of Appeal issued its decision in California Highway Patrol v. WCAB (Margaris) (B269038). The decision holds that the language in Labor Code Section 4610.6(d), which sets forth the 30-day time period within which an Independent Medical Review (IMR) is to be completed, is merely directory, and the failure of the IMR organization (Maximus) to issue its determination within the specified 30-day time period neither invalidates the decision nor confers jurisdiction on the Workers Compensation Appeals Board to make its own determination regarding  medical necessity or appropriateness of the treatment plan at issue.

State Fund attorneys had filed their petition for writ of review of the underlying WCAB panel decision in the case, which had held that this IMR time limit was mandatory and that Maximus’ failure to complete its review and to issue a determination within 30 days voided the IMR determination. Moreover, the three-member panel not only voided the belated IMR determination, it also held—contrary to the IMR determination—that the medical treatment plan at issue was supported by substantial medical evidence and consistent with the medical treatment utilization schedule (MTUS).

The Court of Appeal rejected the applicant’s argument (and the WCAB panel’s holding) that the Labor Code Section 4610.6(d) provision, which states, “the organization shall complete its review and make its determination in writing…within 30 days of receipt of the request for review and supporting documentation,” was strictly mandatory and that the failure to issue a decision within that timeframe rendered the decision invalid.

Instead, the Court of Appeal agreed with defendant State Fund’s contention that the lack of statutory provision for a consequence for noncompliance with time provision was an indication that the Legislature intended the specified 30-day period to be directory and not mandatory.

The Court explained that construing the 30-day provision to be directory was consistent with the legislative history and objectives of SB 863. It concluded that “the Legislature intended to remove the authority to make decisions about medical necessity of proposed treatment for injured workers from the appeals board and place it in the hands of independent, unbiased medical professionals.”  It found that invalidating late IMR decisions and conferring jurisdiction on the WCAB to make medical necessity determinations was contrary to the intent of the Legislature and was not consistent with the statutory provisions governing the IMR process. The Court noted the provision in Labor Code Section 4610.6(i), which states in pertinent part, “In no event shall a workers’ compensation administrative law judge, the appeals board, or any higher court make a determination of medical necessity contrary to the determination of the independent medical review organization,” and observed that this was a “frank expression of  the Legislature’s desire to remove the issue of medical necessity of proposed treatment from the jurisdiction of the appeals board in all cases subject to IMR.”

The Second District Court of Appeal had accepted the case for review because it was deemed to be “an important issue of first impression…and because it relates to an issue upon which the appeals board has rendered conflicting decisions.”

The Court has certified its opinion for publication.

The Third District Court of Appeal has not yet rendered its decision in Southard v. Hallmark Greeting Cards (C079912), another appeal based on the issue of whether the 30-day IMR timeframe provision in Labor Code Section 4610.6(d) is mandatory or merely directory.

In February 2016, the California Supreme Court denied review of the First District Court of Appeal’s decision in Stevens v. WCAB (WCAB No. ADJ 1526353; Case No. A143043), which rejected the applicant’s constitutional challenge to IMR and which held that IMR “is fundamentally fair and affords workers sufficient opportunities to present evidence and be heard.”

Boehm will keep you posted.