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The Reality and Challenges of Liens, and Why They are Here to Stay!
Presenters: Tyrone Spears
Workers’ Compensation Administrator City of Los Angeles
Demetria Willis
Sr. Workers’ Compensation Analyst City of Los Angeles
Michael E. Lents
Compliance and Technical Director Lien On Me, Inc.
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The 2014 Fizzle!
SB 863 was to be the great redeemer for employers against the overzealous lien filers in California.
Oh how we thought liens would just shrivel up and go away by 1/1/2014 and life would be merry again.
It hasn’t happened…nor will it completely! Why?
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SB 863 Attacks Liens
SB 863 created several obstacles for providers hoping to drastically reduce the number of liens in California.
The hurdles: • Activation fees • Filing fees • Statutes of limitation (fixed) • IMR • IBR
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Were the Hurdles that High?
Where are they now? • Activation fees: Bye-bye • Filing fees: Are being paid (for now) • Statutes of limitation: Solid • IMR: Utilization review disputes only • IBR: Fee schedule disputes only for dates of
service on or after 1/1/2013 (say it ain’t so!)
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Liens in Today’s World
Some issues not subject to IBR: • Injury AOE/COE or body part in dispute • Exceeding statutory 24 visit caps • 6-month rule on psych • Post-termination • Good-faith personnel action defense • Statutes of limitation (SOL) • Pre- SB 863 lien filings
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Medical v. All WC Benefits
Based on the August 2013 report from the National Academy of Social Insurance, out of $10.477 billion in workers’ compensation benefits for 2011, California employers and insurers paid $5.906 billion (56.4%) for medical payments.
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The Top 5 in 2011 (Billions)
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CA NY IL PA FL
Total WC Benefits
Medical Payments
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The Raincloud of Reserves
Raindrops keep fallin’ on my head… • Reserves are held to pay for claims • As liens accumulate, so do the reserves • Thunderously attacking liens eliminates them • As reserves dissipate, grass becomes greener!
(Which makes for happy underwriters.)
$ $ $ $ $
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How to Attack Liens
“The clever combatant imposes his will on the enemy, but does not allow the enemy’s will to be imposed on him.”
— Sun Tzu, The Art of War
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City of LA Program
The City of Los Angeles took an aggressive stance to curb abuses and help decrease liens in the work comp industry.
• Being proactive instead of reactive. • Unrelentingly objecting to bills. • Utilizing UR.
The key to it all: Timeliness.
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City of LA Program
The City’s program begins in the mailroom! All bills with no prior authorization (NPA) are
reviewed to determine the need for UR.
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City of LA Program
All compound medications go through UR for medical necessity determinations.
But not just compound medications, it could also be DME, diagnostics, PT, chiropractic, etc.
Retrospective UR is not mandatory but recommended if significant treatment was rendered.
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City of LA Program
Scrutinizing cases like one with 25 medications daily.
Going back to the AME to address medical necessity, even after the case has resolved, gives control back to the employer.
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City of LA Program
Went after restitution when a provider generated duplicate billings after changing its name and tax ID number.
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City of LA Program
By not caving in, and sticking to the UR denials, the City is prevailing at lien trials and has obtained numerous take nothings.
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City of LA Successes
City of Los Angeles success stories.
Case #1: • Michael’s Pharmacy prescribed medication. • The charges went through UR and were non-certified. • No medical reports by the PTP refuting the denials. • The AME commented that the medication was for a
non-industrial preexisting condition.
WCJ: Take Nothing
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City of LA Successes
Case #2: • Applicant sustained admitted injury to knees, sleep
disorder and sexual dysfunction. • Meridian Medical submitted a lien for a CPAP device. • The City put the request through UR, which was
conditionally non-certified requesting additional information. No additional information was provided.
• The applicant was seen by a sleep disorder medicine specialist whose opinion was the applicant could not tolerate a CPAP unit.
WCJ: Take Nothing
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City of LA Successes
Case #3: • Access MediQuip billed for implantable hardware for a
spinal surgery. • City of Los Angeles denied payment and presented
testimony that the hardware was not to be separately reimbursed.
• Lien claimant offered no rebuttal testimony.
WCJ: Take Nothing
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City of LA Successes
Case #4: • Admitted injury with 85% PD to multiple body parts. • Three AMEs were utilized. All commented on
treatment protocols. • UR denials.
• 25 lien claimants • $172,588.05 in liens • $7,924.30 in lien resolutions • $164,663.80 savings
Saving Percentage: 95.4%
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City of LA Stats for 2013
Savings
Full & Final
Savings 84.9%Full & Final 15.1%Total: 100.0%
Resolved Outstanding Balance
For CITY OF LOS ANGELESFrom: 1/1/2013 To: 12/31/2013
Actual O/S Balance
Full & Final Amount
Savings Amount
Savings Percentage ROI
$6,419,953.11 $971,992.94 $5,447,960.17 84.9% 13:1
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City of LA Stats & Reports
City of Los Angeles ROI for 2013 project: 13:1 Not a bad way to end the year!
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And now what are you going to do about it?
As employers, we can change the future of liens!
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Q & A?
