On October 28, 2019, the Workers’ Compensation Appeals Board (“WCAB”) addressed the competency of California Labor Code Section 4903.8.(d) declarations and provided guidance on important requirements regarding same. Six years ago, the legislature enacted Labor Code section 4903.8 in an effort cut down on the tremendous backlog of liens that were filed.
The code required a declaration at the time of filing liens on or after January 1, 2013, including the filing of supporting documentation with one or more declarations under penalty of perjury by a natural person or persons competent to testify to the facts stated, declaring both of the following:
- The services or products describe in the bill for services or products were actually provided to the injured employee; and
- The billing statement attached to the lien truly and accurately describes the services or products that were provided to the injured employee.
The competency of the declarant attesting to the filed declaration was challenged in Fuerte vs. SLSA Enterprise (2018) 2018 Cal. Wrk. Comp. P.D. Lexis 328, 10-11, and Ramos v. Tri-State Employment Services/Diamond Staffing (2018) 2018 Cal. Wrk. Comp. P.D. Lexis 342,10-11. However, in the resulting decisions, the Appeals panel did not provide any guidance because the matter was returned back to the trial level to allow the defendants to provide evidence regarding the competency, or lack thereof, of the declarants.
The WCAB has now provided definitive guidance in a recent panel decision. In the matter of Luisa Isabel Rodriguez v. Kelly Services (October 28, 2019) 219 Cal. Wrk. Comp. P.D. LEXIS ___, the competency of the 4903.8(d) declaration signed by Patrick Christoff, an attorney for lien claimants Comprehensive Outpatient Surgery Center and Technical Surgery Support was challenged by defendant. Mr. Christoff testified that he was competent to sign the declaration based on his employment with lien claimant since 2003, his job duties of collecting on liens, his knowledge and understanding of billing procedures and codes, reviewing and negotiating bills, and reviewing surgical and medical reports, which included over 10,000 operative reports and bills. In addition, Mr. Christoff testified that he reviewed operative reports to ensure that the description of the service in the operative report matched the services billed in the invoice. Mr. Christoff testified that he relied on the information in the operative reports to determine the accuracy and specificity of the actual billing to ensure that they were the same and matched each other. Mr. Christoff testified that he did not have any formal training or classroom instruction on CPT coding, did not attend any seminars in bill review, and did not recall being in the operating room for any of the procedures that were billed. Mr. Christoff based his declaration on the doctor’s chart notes, and the doctors declared under penalty of perjury that the services were provided on that date.
Defendant argued that Mr. Christoff did not have personal knowledge that the billing statement accurately described the products/services provided to the injured employee and that those products/services were actually performed because he had no recollection of being in the operating room during any of the operative procedures, he had no recollection of discussing this case with the doctor who performed the services, and his recollection for the declaration came from review of the billing, chart notes, and reports. Based on his trial testimony, Defendant asserted Mr. Christoff had absolutely no personal knowledge about whether the services were actually performed and properly billed, and that all of his knowledge came from other sources and thus constituted hearsay. Defendant further stated that California Labor Code Section 4903.8(d) required the declarant to be a natural person competent to testify to the matters asserted in the declaration.
The WCAB gave clarity to the phrase “competent to testify” in 4903.8(d), as defined in California Evidence Code Section 702, which provides:
(a) Subject to section 801, the testimony of a witness concerning a particular matter is inadmissible unless he has personal knowledge of the matter. Against the objection of a party, such personal knowledge must be shown before the witness may testify concerning the matter.
(b) A witness personal knowledge of a matter may be shown by any otherwise admissible evidence, including his own testimony.
Therefore, the declarant must have personal knowledge that the billing statement accurately describes the services/products provided to the injured employee and that those services/products were actually provided. While the court agreed that Mr. Christoff was not present for any of the medical procedures, this did not necessarily preclude or prevent him from competently testifying about the services that were actually performed or properly billed. Interestingly, the court stated further, while the surgical and medical reports are hearsay, they can base their decision on hearsay evidence. Labor Code Section 5708 allows the Appeals Board or workers’ compensation judges to determine, through oral testimony and records, which is best calculated to ascertain the substantial rights of the parties and carry out justly the spirit and provisions of this division. Hearsay evidence must be evidence of a substantial character from which the WCAB may deduce a reasonable inference.
The court determined Mr. Christoff was competent to testify to the facts stated in section 4903.8(d) declarations.
Based on the facts and evidence presented in this case, this decision gives clarity to what constitutes a competent person or natural person to sign the 4903.8(d) declaration. The declarant can rely on their qualifications, training, and experiences of collecting and negotiating liens, reading and reviewing reports, having familiarity with billing procedures and CPT codes, and understanding of medical procedures performed. Additionally, the Board acknowledges that hearsay evidence such as operative or medical reports can be relied upon as admissible evidence when it is attested to by a medical provider as true and accurate under penalty of perjury.