When an employee files a workers’ compensation claim, the employer or insurer is immediately liable for the cost of all medically necessary treatment provided before the claim is accepted or denied. In other words, even if the employer or insurer ultimately denies a claim, treatment provided up to $10,000 is authorized before the claims administrator issues that denial.
This important rule guarantees that liability for medically necessary treatment is never in question while an employer or insurer considers a claim — whether the claim is accepted or not.
Per California Code of Regulations (CCR) Section 9812, within 14 days from receipt of a new claim, the employer or insurer’s claims administrator must decide to:
Until the claims administrator makes the decision to accept or deny liability, the employer or insurer are on the hook for treatment that conforms to the Medical Treatment Utilization Schedule (MTUS), within the $10,000 limit set by Labor Code Section 5402(c):
Note the term “alleged.” The payment for all treatment applies regardless of ultimate liability for the injury in question. In fact, §5402(d) clarifies that §5402(c) “shall not give rise to a presumption of liability,” making it clear that no matter the liability decision, the employer/ insurer must pay for all necessary treatment until the decision is reached.
Providers must still submit a compliant Request for Authorization, subject to utilization review, for all medically necessary treatment that precedes the liability decision.
Bottom line: Regardless of ultimate liability for the injury, reimbursement is due for medical treatment provided until the claims administrator reaches their liability decision. For employers and insurers, it’s simply the cost of doing business.
*If after 90 days no decision is issued, liability for the injury is presumed. If the claims administrator presents new evidence that was unavailable during the 90-day delay that supports denial of the claim to the Workers’ Compensation Appeals Board, the Board may reverse said presumption.
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