Sedgwick (and the DWC) Ignore Providers' Appeals

Sedgwick (and the DWC) Ignore Providers' Appeals

Sedgwick is running roughshod over California providers, in violation of state workers’ comp law.

By failing to take substantive action, the Division of Workers’ Compensation (DWC) is effectively allowing Sedgwick to inflict this payment torture on those who treat California’s injured workers.

As reported previously, by failing to apply an April 1 fee schedule update, Sedgwick has repeatedly underpaid daisyBill clients (and surely many other providers). This week, we shared data from hundreds of Second Review appeals submitted to Sedgwick disputing these incorrect reimbursements.

For just two providers, daisyCollect sent Sedgwick 239 appeals. Sedgwick either ignored or improperly denied 136 (57%) of the appeals.

Below, we present broader daisyData which prove irrefutably that Sedgwick routinely violates the mandated Second Review process, making it unnecessarily difficult for providers to obtain correct payment.

Worse, the DWC is well aware of Sedgwick’s patterns of behavior, but fails to act. Much of the data below have been submitted to the DWC in formal Audit Complaints reporting Sedgwick’s clear, unambiguous violations. The DWC has imposed no consequences to effectively deter Sedgwick’s business practices, despite having the full legal authority to do so.

The predictable result has been Sedgwick’s continued, egregious non-compliance.

California workers’ comp has strict laws, regulations, and rules dictating how providers must submit bills and appeals; if the provider is non-compliant, the claims administrator keeps the balance owed by default.

California workers’ comp also has laws, regulations, and rules regarding how claims administrators must respond to bills and appeals. But when claims administrators like Sedgwick are non-compliant, it’s business as usual—and (providers’) money in the bank.

Sedgwick Ignores CA Law, DWC Does Nothing

For daisyBill clients who sent Sedgwick Second Review appeals between January 1, 2019 and April 30, 2022, daisyData show that Sedgwick failed to respond compliantly 35% of the time, as follows:

  • Sedgwick denied 4,930, or 11%, of Second Review appeals as “duplicate” bills
  • Sedgwick failed to respond compliantly to 11,331, or 25%, of Second Reviews appeals

For the 4,930 Second Review appeals Sedgwick improperly denied as supposed “duplicates” of the original bills, daisyBill sent the DWC a formal Audit Complaint, complete with data proving the violations, in June 2022. Since our filing of the initial Audit Complaints in 2022, the rate at which Sedgwick denies Second Review appeals as “duplicate” bills has doubled.

For daisyBill clients who sent Sedgwick Second Review appeals between May 1, 2022 to April 30, 2024, Sedgwick’s overall non-compliance increased to 40%, as follows:

  • Sedgwick denied 17,225, or 22%, of Second Review appeals as “duplicate” bills
  • Sedgwick failed to respond compliantly to 14,762, or 19%, of Second Reviews appeals

The table below breaks down the statistics (and yes, daisyBill will be filing more Audit Complaints with the DWC). The data demonstrate that over time, Sedgwick has become ever bolder in its disregard for California workers’ compensation laws and regulations.

Second Review Appeal Submission Date

1/1/2019 - 4/30/2022

% of Appeal Total

5/1/2022 - 4/30/2024

% of Appeal Total

Second Review Appeals Sent to Sedgwick



Appeals Denied as “Duplicate” Bill





No Response to Appeal





Total Appeals Denied / No Response





daisyBill also submits Audit Complaints to the DWC to report appeals to which Sedgwick fails to respond. To date, daisyBill has filed Audit Complaints reporting incidents of Sedgwick non-compliance for over 190,000 bills and appeals in total.

The Sedgwick Payment Gauntlet

For each of the 239 appeals daisyCollect sent to Sedgwick, our agents adhered to DWC requirements and submitted a signed SBR-1 form like the one below specifying Sedgwick’s failure to honor the applicable fee schedule updates and pay at the correct rate for the date of service.

With the SBR-1, daisyCollect also submits a CMS-1500 billing form indicating a Second Review appeal as follows:

  1. Code ‘BGW3’ is entered in box 10d indicating a Second Review appeal
  2. Code 7 for “Replacement of prior claim (bill)” is entered in box 22, along with the original reference number reported in the Explanation of Review (EOR)
  3. “RECONSIDERATION!” Is entered in Box 19 for “Additional Claim Information”—literally in all caps with an exclamation point.

daisyCollect also submits Sedgwick’s original EOR featuring the incorrect payment, and all medical documents sent with the original bill. Per DWC instructions, the appeals are sent electronically, since the original bills were sent electronically.

While each bill may represent only a few dollars in underpayment, the savings undoubtedly add up for Sedgwick. And over time, the losses add up for providers.

For providers using daisyBill technology and automation, sending a Second Review appeal takes about 30 seconds. But for providers who do not use daisyBill, these appeals are a huge administrative burden.

Sedgwick’s Non-Compliant Second Review Denials

As demonstrated above, a compliant Second Review appeal leaves no reasonable doubt that the submission is an appeal, and not a duplicate bill.

Per California Code of Regulations Section 9792.5.5, Sedgwick is obligated to respond with a final EOR and any additional payment owed within 14 days of receipt of the appeal. Unfortunately, Sedgwick is just as good at ignoring the mandatory Second Review process as they are at ignoring fee schedule updates.

In a well-established, infuriating practice, Sedgwick routinely denies Second Review appeals by claiming the appeals are “duplicates” of the original bills, as shown in the final EOR below.

As demonstrated by the DWC’s inaction—despite Audit Complaints that document nearly 200,000 acts of non-compliance with California law and regulations—Sedgwick can inflict administrative torture on providers with impunity, and without consequence.

No one should wonder why it’s becoming increasingly difficult to find providers who are willing to treat injured workers.

We deal with Sedgwick so you don’t have to. daisyCollect professionals use advanced software (and years of experience) to protect your practice. Learn more below:


1 Reader Comments
Sanjay Chauhan

I am glad for the work Daisybills is putting in to get proper and timely reimbursement for providers. It is equally frustrating that legal body(DWC) does nothing to deter noncompliance of Sedgwick. It looks like other than prayers, providers can't really do anything!!!

Published 09:53AM June 13, 2024
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