California workers’ comp has lost yet another sizable medical practice, in another unmistakable sign of the ongoing breakdown of the system.

Palomar Health Medical Group’s Urgent Care location announced its departure from workers’ comp this month, joining the increasingly crowded graveyard of practices that no longer treat California’s injured workers. Palomar has yet to comment on the reasons for its decision publicly.

In California, doctors have two choices:

1. Treat privately insured or Medicare patients and get paid, or
2. Roll the dice on injured workers, which requires substantial administrative costs, and be prepared to take a loss.  

Increasingly, providers tell daisyBill that they can no longer afford the administrative costs or risks inherent to treating injured workers.

Sadly, these injured workers are the ultimate victims of California’s workers’ comp bedlam. Details on Palomar Urgent Care’s retreat and the factors driving providers from this ailing system follow below.

Palomar Urgent Care Calls It Quits on Workers’ Comp

Palomar Health Medical Group notified providers of the decision in the email below, advising that the company’s Urgent Care “will no longer provide care for work-related injuries” and instructing providers to direct injured workers to its Corporate Health Services location or after-hours to the Emergency Room.

Wake Up, CA: More Practices Will Refuse Injured Workers

Why are practices closing their doors to injured workers? In brief, the answer is self-preservation. It is not financially feasible to treat injured workers due to the following factors:

1. Medical Provider Networks (MPNs): This ungoverned, unnavigable system leaves providers unpaid for authorized services, often based on inapplicable or non-existent MPNs.

2. Inequitable Fee Schedules: Despite the extraordinary administrative expenses required to treat injured workers, fee schedule rates are often inadequate. For example, the Official Medical Fee Schedule (OMFS) pays physicians less than interpreters for evaluations.

3. Preferred Provider Organizations (PPOs): PPOs reduce fee schedule reimbursements to below Medicare rates, exclude providers who refuse to sign PPO contracts from MPNs, and share contractual discounts with laundry lists of claims administrators, bill review companies, and more.

4. Utilization Review (UR): To obtain authorization, providers expend considerable administrative resources to navigate the often Sisyphean UR process, by which claims administrators can deny treatment for demonstrably nonsensical reasons.

5. Failed Billing and Payment Regulations: The lack of regulatory penalties allows claims administrators to improperly adjust or deny physicians’ bills with impunity. Even when physicians accept the administrative costs to dispute incorrect payments and denials, claims administrators can simply ignore these efforts.

The California Division of Workers’ Compensation (DWC) enables claims administrators to churn chaos throughout California. In a practically diabolical manner, the DWC fails to enforce the few laws and regulations designed to protect physicians and injured workers from abuse, non-compliance, and incompetence by claims administrators. The DWC:

• Instructs newly injured workers to use their private health insurance or find a physician to treat them for free
• Allows claims administrators to delay treatment by refusing to authorize treatment for up to 90 days while the claims administrator “investigates” a new claim (despite the legal requirement to immediately authorize up to $10,000 in treatment regardless of liability)
• Fails to address costly non-compliance with billing and payment requirements, even in the face of overwhelming hard evidence of consistent violations
• Establishes billing regulations rigged to reward claims administrators for incorrectly reimbursing providers’ bills
• Refuses to conduct Independent Bill Review (IBR) for straightforward billing disputes
• Forces providers to pay $180 for IBR, subsequently fails to conduct IBR for eligible disputes timely, and fails to enforce repayment of the $180 to providers who succeed at IBR
• Ignores legal mandates to implement systems to provide UR oversight
• Fails to manage MPN information so that doctors can reliably determine eligibility to treat injured workers

Palomar Health Medical Group Urgent Care has made its choice in its best financial interests. How many more practices will follow? At what point will California and the DWC address this crisis? When injured workers are forced to seek care from veterinarians?

All of the problems above have clear and feasible solutions. Whether California legislators and regulators choose to embrace and execute those solutions remains to be seen.

daisyBill makes workers’ comp billing easier, faster, and less costly. Request a complimentary demonstration below.

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