Governor Schwarzenegger’s veto of AB 2969 (Lieber) protects insurance company profits at the expense of injured workers. This legislation, proposed by Assemblywoman Sally Lieber, would have put a stop to an insidious practice by the insurance industry that undermines injured workers, sabotages treatment prescribed by properly licensed doctors, and protects wrongful business practices by insurance interests. Here’s how the protected scheme works:
Joe Sixpack or Soccer Mom Sarah incur an on-the-job injury. The injured worker goes to a clinic that accepts industrial injuries. The injury turns out to be complicated. Specialists are consulted. Treatment recommendations are made. Documents are filed according to law to make sure that treatment is covered by the insurance company. At this point insurance companies may retain Utilization Review (UR) companies to review the treatment that has been provided as well as the treatment that is being recommended or prescribed. These reviews are conducted in accordance with law, namely, the AMA Guides, 5th edition, and the ACOEM Guidelines, 2nd edition, both of which enjoy the force of law thanks to statutes pushed into law by the Schwarzenegger administration to reduce costs of industrial injuries to insurance companies and to employers.
The AMA and ACOEM cookbooks allow UR doctors who have not interviewed or examined injured workers to review treatment proposals and to delay, deny, or modify treatment. UR doctors are allowed to overrule properly licensed doctors who have spent hours with their patients. UR doctors who make decisions about workers injured in California do not need to be licensed in California. Any license will do. UR doctors do not have to interview or examine injured workers. UR doctors review paperwork to do their jobs. When these disturbing inequities were noticed in Texas, legislation was passed to put a stop to it — UR doctors in Texas must now have Texas medical licenses. They’re responsible to the Texas Medical Board.
In California UR doctors need not be responsible to any medical board at all. In one quizzical situation, an injured worker in California, under treatment by a California-licensed doctor, had his treatment stopped dead in its tracks based upon the UR decision of a doctor with only a Connecticut license. To add insult to injury, the Connecticut doctor reported his denial of care to a UR company based in Texas. The upshot was that the UR doctor licensed only in Connecticut and the UR company based in Texas effectively conspired to stop treatment prescribed by a California-licensed doctor and that was already underway in California.
Insurance companies and their compliant utilization review companies may use doctors whose bent is to deny as much care as possible. Because UR doctors are allowed to practice medicine in California without California licenses, UR doctors don’t need to worry about what the Medical Board of California might do when they cause harm to patients by wrongful denials, delays, or modifications of care.
Ordinarily, when a doctor amends, denies, delays, or modifies treatment it is assumed that the doctor is practicing medicine. California law requires a California medical license to practice medicine in California. Because of a drafting error, the phrase, “California-licensed,” is missing from the relevant section in the California Labor Code. The Medical Board of California recognizes the oversight and sent a letter to Gov. Schwarzenegger that UR doctors are practicing medicine and should obtain licensure to practice medicine in California if they are going to decide about care for injured workers in California. Unfortunately, the Governor’s judgment was swayed more by the American Insurance Association (AIA) than by his own medical board.
Here’s what AIA said: “AB 2969 (Lieber) would ban medical treatment utilization review by physicians licensed in states outside California.” Wrong. Furthermore, Governor Schwarzenegger did not get hoodwinked by this incorrect statement. Nevertheless, he vetoed the bill. Why do we think he did so? The Governor cast his veto against legislation which would only have required that UR doctors also have California licenses no matter in what other states they were also licensed.
The American Federation of State, County and Municipal Employees (AFSCME, AFL-CIO) adopted a resolution that doctors should hold state licenses in any state where they do UR. The Schwarzenegger veto message said that requiring state licenses “would be inconsistent with how utilization review is conducted in other areas of medicine and not in line with best practices nationwide.” Governor Schwarzenegger conveniently didn’t mention Texas where state licenses have been required for UR since 2007.
It should have been of much more concern to Governor Schwarzenegger that the Western Occupational & Environmental Medical Association (WOEMA), a component society of ACOEM, urged support for licensing UR doctors in California “to help ensure that utilization review is performed by knowledgeable and accountable physicians.”
Don’t forget this caveat: in California doctors who treat patients must take a specialized 12-hour course in pain management, a leading cause of disability. They are also responsible for 26 pages of single-spaced California-specific regulations governing utilization review. Doctors without California licenses are not held responsible for either.
That would have helped Governor Schwarzenegger to overcome his antipathy to the interests of injured workers since this bill was supported by the California Labor Federation, AFSCME, and the California Medical Association (CMA) and was sponsored by the Union of American Physicians and Dentists (UAPD), the California Society of Industrial Medicine and Surgery (CSIMS), and the California Physical Medicine and Rehabilitation Society (PM & R).
Some advocates for the Governor’s veto asserted that California doesn’t have enough doctors to do peer review and needs out-of-state doctors. This assertion is rubbish. We know that one major UR company based in California uses only doctors with California licenses and actually has a waiting list since more doctors have applied for these positions than are needed. In the words of the CMA, “there is no shortage of qualified California-licensed physicians to perform hands-on utilization review for cases involving California’s injured workers.” There just may be a shortage of California-licensed doctors willing to do the bidding of insurance companies. That would explain why insurance companies may search for doctors without California licenses.
The main reason that Gov. Schwarzenegger vetoed California-licensure for UR doctors has more to do with the AIA which asked for the veto and which reminded the Governor that AIA represents about 350 insurance companies that write $123 billion annually in premiums. That’s the point that influenced Governor Schwarzenegger’s unfortunate veto. Governor Schwarzenegger’s judgment is that the interests of the insurance industry deserve priority over the interests of injured workers and their pesky doctors.
The answer to this tilt towards the insurance industry over the needs of injured workers is to return in 2009 with new legislation. The name of the game is to put patients before profits.
Dr. Robert Weinmann, past President of the Union of American Physicians and Dentists (UAPD) has a private neurology and pain management practice in San Jose. He is currently president of the UAPD Independent Practice Association. He has provided dynamic and effective testimony before the United States Congress and the California Legislature on matters of healthcare, patients’ and physicians’ rights, Medicare, and antitrust reform. Weinmann has received awards from the United States Congress and the California Assembly, and at the invitation of former President Bill Clinton was featured as a speaker at the White House on managed care. He points out that his public policy agitation in healthcare is bipartisan.
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