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News, data, & insights about workers' comp billing

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The Provider’s Burden: Appealing Improper Reimbursements

October 6, 2017 by Catherine Montgomery

Worker’s comp billing is hard enough.

Four years ago, California passed strict requirements that providers must follow to appeal incorrect reimbursements from insurers. These requirements are burdensome to the point of being prohibitive — and insurers know it. Since most providers lack the resources to appeal incorrect payments, insurers and their claims administrators can underpay without fear of consequence.

The appeals process is tough for providers.

With the burden of proof on their shoulders, providers remain vulnerable to the systemic abuse enabled by the Second Review process.

Second Review Appeals

Senate Bill 863 created burdensome requirements for providers.

Since the passage of Senate Bill 863, when a provider disputes an incorrect reimbursement, they must timely and compliantly appeal the incorrect payment by submitting a request for Second Review. The timeliness, format, and delivery method of the request are all subject to state-mandated requirements that took effect starting January 1, 2013. If a provider fails to appeal an incorrect payment compliantly, California law voids the provider’s bill.

Labor Code § 4603.2(e) mandates that if a request for Second Review is non-compliant in any way, the bill “shall be deemed satisfied and neither the employer nor the employee shall be liable for any further payment.”

Yet, the claims administrator is under no pressure to correctly pay bills, because there are zero consequences for incorrect payments. Our clients often report that claims administrators systematically make payment “errors,” including incorrect downcoding, erroneously claiming lack of authorization, using inapplicable PPO discounts, and mistakenly applying Correct Coding Initiative (CCI) edits. While these are avoidable payment errors, submitting a compliant appeal is the provider’s burden.

If the Second Review request is not timely or is non-compliant in any way, the claims administrator is free to ignore the request. The following Second Review requirements are not negotiable:

  • Timeliness: Submit Second Review appeal within 90 calendar days from receipt of the Explanation of Review (EOR).
  • Format: Use either a modified original bill or DWC Form SBR-1. (We strongly recommend using the DWC Form SBR-1 ).
  • Delivery: Use the same delivery method (i.e., paper or electronic) as the original bill.
  • Reason: Articulate the rationale for disputing the incorrect payment.
  • Documentation: Provide all relevant supporting documentation.

Second Review Solutions

DaisyBill designed technology to eliminate the burden of appealing incorrect payments. Using our software, specifically designed to combat incorrect payments, DaisyBill clients have collectively recovered over $22 million from submitting over 300,000 Second Review appeals. Our Second Review technology:

  1. Automatically detects erroneous payments
  2. Alerts the provider
  3. Instantly submits a compliant Second Review appeal

How many millions of dollars have claims administrators reaped from providers that do not use technology that combats systematic incorrect payments? Unless providers adopt such technology, they pay the price for working in a system that’s inherently rigged against them.  

When providers have to go this far out of their way to obtain correct reimbursement, something isn’t right. When the time and resources required to fight for what is owed rival the revenue being denied in the first place, the cost/benefit analysis of treating work comp patients looks ever more dubious.

Providers— and the injured workers they treat— deserve better.


To level the playing field, DaisyBill offers everything providers and billers need to submit fast, fully compliant requests for both second bill review and independent bill review.

Our Essential Tools includes compliant SBR templates that providers and billers can auto-populate and submit within 30 seconds. It also includes access to our searchable database of IBR decisions to make your case for proper reimbursement airtight. Schedule a free demonstration today!

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