Appeals Board Stresses Panel Requirement

By Jane Salem, staff attorney, Nashville

Employers/carriers: as a general rule, when an employee reports a work injury, you must offer a panel of three physicians within three business days. This requirement isn’t new; yet it still isn’t followed universally. An Appeals Board opinion released last week shows that when a panel isn’t given, the consequences can be unfavorable for the employer.

In Williams v. People Ready, Inc., Cornelius Williams, a construction laborer, reported knee and neck pain after a large metal pipe struck his left leg and pinned him momentarily. People Ready directed him to a walk-in clinic, Concentra.

After several weeks of evaluation and treatment, a Concentra physician made a “stat” referral to an orthopedic specialist, and staff scheduled Williams an appointment with Dr. John Lochemes to occur two business days later.

At the appointment, Dr. Lochemes found osteoarthritic changes, a “displaced tear of the medial meniscus,” a “complete ACL tear,” and an “intra articular loose body within the lateral compartments superior to posterior horn of the lateral meniscus.” He recommended surgery.

Approximately one month later, the carrier offered a panel of orthopedic specialists and told Williams the visit to Dr. Lochemes was unauthorized. A claims adjuster’s sworn declaration explained that she didn’t learn about Concentra’s “stat ortho referral” until “sometime in the month of September.” By that time, she’d already received a call from Dr. Lochemes’s office requesting authorization for surgery, which she declined.

The panel the carrier offered didn’t include Dr. Lochemes. The adjuster asserted she never received a copy of the referral slip evidencing a direct referral from Concentra to Dr. Lochemes until Williams’s attorney gave her a copy in October.

Williams refused to select a new physician and requested an expedited hearing.

The trial court ordered People Ready to authorize treatment with Dr. Lochemes, and People Ready appealed.

The opinion

The Board affirmed after considering the interplay among several statutes, regulations, and case law.

As for statutes, section 50-6-204(a)(3)(A)(ii) covers referrals to specialists, but it applies in circumstances where “the treating physician, selected in accordance with this subdivision (a)(3)(A) … [makes] referrals to a specialist physician[.]” Next, when a panel-selected physician makes a referral, that physician is statutorily required to “immediately notify the employer.” Then, “the employer shall be deemed to have accepted the referral, unless the employer, within three (3) business days, provides the employee a panel.”

In this case, the outcome turned on yet another statute. Subsection 204(a)(3)(E) states, “In all cases where the treating physician has referred the employee to a specialist physician, … the specialist physician … to which the employee has been referred, or selected by the employee from a panel provided by the employer, shall become the treating physician until treatment by the specialist physician …concludes and the employee has been referred back to the treating physician selected by the employee from the initial panel[.]”

Considering that, the Board reasoned that whether the referral is made directly by an authorized treating physician, or selected from a panel of physicians, the physician to whom the employee was referred is designated a “treating physician.”

Finally, subsection 204(a)(3)(H) states, “Any treatment recommended by a physician or chiropractor pursuant to this subdivision (a)(3) or by referral, if applicable, shall be presumed to be medically necessary for treatment of the injured employee.”

The Board also cited applicable regulations:

  • After receipt of notice of a workplace injury and the employee expressing a need for medical care, an employer shall, as soon as practicable but no later than three business days after receipt of such a request, provide the employee a panel of physicians.
  • An employer directing an employee to an on-site or other “employer-sponsored medical provider” doesn’t “alleviate the requirement for providing an appropriate panel within the three (3) business days.”

Case law further supported the trial court ruling. Specifically, an employer who doesn’t timely provide a panel of physicians risks being required to pay for treatment an injured worker receives on his own. And, the workers’ compensation statutes contemplate “direct referrals to specialists and provide[] employers the option of accepting the referrals or, instead, providing a panel of specialists.”

Applying all these principles, the Board listed a string of failures. People Ready didn’t provide an appropriate, timely panel but rather directed Williams to Concentra. On making the “stat” referral to an orthopedic specialist, Concentra failed to “immediately notify the employer” of the referral. That led, in turn, to People Ready failing to respond within three business days of the referral.

“Even if we were to conclude that the provisions of the ‘direct referral’ statute apply in this case, Employer is ‘deemed to have accepted the referral’ to Dr. Lochemes in accordance with the express language of that subsection,” the Board wrote. “Regardless, we agree with the trial court that the provisions of subsection 204(a)(3)(A)(ii) were not triggered because Concentra, the provider to whom Employee was directed, was not ‘selected in accordance with this subdivision (a)(3)(A).’”

Rather, Dr. Lochemes became the treating physician when the authorized treating provider, Concentra, made the referral, and People Ready failed to take appropriate action within three business days. In addition, Dr. Lochemes’s treatment recommendations, under the statute, are “presumed to be medically necessary.” Therefore, the Board agreed with the trial court’s designation of Dr. Lochemes as the authorized treating physician.

The Board’s decision is interlocutory, so it can’t be further appealed.

A west Tennessee walk. Looks inviting. Photo by Judge Deana Seymour, Memphis.

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