In this second look at the County of Orange’s refusal to pay for telehealth treatment, we pose a critical question:

What kinds of chaos will be unleashed if Orange County is allowed to implement its own absurd proprietary treatment guidelines, such as a “no telehealth” policy?

Refusing payment for authorized services rendered via telehealth is a blatant contravention of California’s Physician Fee Schedule. Telehealth is a practical reality of 21st-century medicine payable according to California workers’ compensation law and regulations.

Despite Orange County’s Third-Party Administrator, Sedgwick, denying payment for authorized treatment, the provider persevered; Sedgwick ultimately capitulated and paid for the services — but how many other providers will Sedgwick and Orange County attempt to stiff for telehealth care?

More importantly, Orange County's invention of novel treatment restrictions contradicts Physician Fee Schedule regulations, demonstrating that California offers no substantive regulatory protection for injured workers or the providers who treat them.

Providers Must Adhere to Orange County Preferences

In an email to the provider who furnished the (authorized) treatment via telehealth, Sedgwick made the dubious claim that Orange County is “allowed” to restrict injured workers from accessing telehealthcare:

In other words (according to Sedgwick), Orange County may disregard state telehealth regulations as a matter of “preference.” 

In a sense, Sedgwick is correct in claiming that Orange County is “allowed” to implement this policy; thanks to the utter lack of regulatory enforcement in California workers’ comp, payers have little to fear by way of repercussions. However, the Physician Fee Schedule regulations are clear, as explained below.

CA Physician Fee Schedule 2024: Telehealth Is Payable

Orange County is not above state law or regulations and is bound to pay for authorized services rendered.

As we explained in detail in our 2024 Physician Fee Schedule webinar, the schedule establishes that telehealth remains an acceptable — and fully reimbursable — method of delivering specific services, including the treatment billed in this case.

California Code of Regulations Section 9789.19 establishes the telehealth reimbursement regulations for Dates of Service on or after February 15, 2024 (the services in question were rendered in March 2024).

The Physician Fee Schedule regulation is precise:

1. Services listed in the Centers for Medicare and Medicaid Services (CMS) ZIP file, “CY 2024 PFS Final Rule List of Medicare Telehealth Services_V13Nov2023” as deliverable via telehealth are…deliverable via telehealth. 
2. For billing purposes, if the patient was at home during the telehealth appointment, the “place of service” (so to speak) is a non-facility. Otherwise, the “place of service” is considered a facility.
3. Providers use modifier 95 on the applicable billing code to indicate that the services were delivered via telehealth.

From there, the standard rules of billing and payment apply. Nowhere in the regulations are employers permitted to deny payment based on some random, inexplicable “preference” for pretending Zoom doesn’t exist.

A Dire Diagnosis

In the end, Sedgwick paid up — but this is only one incident.

While this particular provider won this particular skirmish, the impunity with which Orange County and Sedgwick impose arbitrary preferences is a dire indication for all California providers and injured workers. Without consistent rules that apply equally to all parties, workers’ comp can only devolve further towards anarchy.

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