In a legal victory for doctors who treat injured workers, a California appeals court has ruled that a Beverly Hills medical group was unfairly denied due process when its medical bills were branded fraudulent and disallowed by a workers' compensation judge.
Observers said the ruling, if it withstands a likely appeal, will strengthen the hand of doctors in some of their legal skirmishes with workers' comp insurance companies. Many doctors have contended recently that the insurers are improperly trying to discourage claims from injured workers by increasingly refusing to pay justified medical expenses.
The decision by the California Court of Appeal last week stemmed from a controversial and sweeping ruling in April, 1993, by a Long Beach workers' compensation judge. The judge tossed out the benefit claims filed by a group of 10 employees laid off by El Segundo-based International Rectifier Corp. and accused the workers, their lawyers and doctors of conspiring to commit insurance fraud by submitting bogus claims.
As part of that ruling, the judge disallowed the $158,000 in bills submitted by the medical practice that evaluated and treated the workers, Beverly Hills Medical Multispecialty Group. The practice appealed the decision, arguing that the judge unfairly prevented it from doing such things as cross-examining witnesses or otherwise fully participating in the case.
The practice's victory on that point will help doctors who evaluate patients in good faith to collect on their legitimate expenses from insurers, even if the workers' injury claims themselves are rejected in court, said Carlyle R. Brakensiek, executive vice president of the California Society of Industrial Medicine and Surgery.
But Edward C. Woodward, president of the insurance industry-funded California Workers' Compensation Institute, said the ruling could increase litigation costs and add to the backlog of cases already bedeviling the workers' comp court system.