We write a lot here and elsewhere about California’s failure to adequately enforce workers’ comp payment laws and regulations. This failure has created an environment that’s unbelievably permissive for claims administrators, unbelievably chaotic for providers, and often unnavigable for injured workers.

If there’s an “Exhibit A” that best represents this lax enforcement, an emblem of everything wrong with a decrepit system, it is undeniably Sedgwick Claims Management Services.

Sedgwick is a Third-Party Administrator representing insurers and self-insured employers across the state (and the nation). No entity in our database more consistently violates California laws and regulations — making it more difficult for providers to treat injured workers.

As one provider recently commented, in reference to a previous article on Sedgwick:  Thanks for posting. I will never see another Sedgwick patient again. They simply authorize and then don’t pay. I have struggled and struggled to get paid by them. I have one adjuster who helps me with one patient. But other than that I’m done with them!

Below, we update and share 2023 data confirming that Sedgwick continues to disregard California’s requirement that claims administrators return electronic Explanations of Review (e-EORs) in response to electronic bills — a crucial requirement no claims administrator should be permitted to ignore.

Sedgwick Non-Compliance: No Signs of Slowing Down

Below are data from hundreds of thousands of electronic bills daisyBill providers submitted to Sedgwick, for which the TPA failed to return an electronic Explanation of Review.

As we can see, no efforts by providers, daisyBill, or the state (assuming the state has made any efforts), have had any effect on the TPA.

For 2023 so far, Sedgwick’s overall rate of non-compliance with the e-EOR mandate is 23%, representing 42,674 e-bills for which no e-EOR was sent, in this year alone.

Sedgwick Is Making Workers’ Comp Worse

The administrative costs of treating injured workers are massive (hence California’s decision to set workers’ comp reimbursement rates at roughly 140% of Medicare rates). To reduce the time, effort, and expense of handling the paperwork, California allows providers to bill electronically — and requires claims administrators to accept e-bills and return e-EORs.

Failing to send e-EORs is not only an act of non-compliance by Sedgwick; it forces painstaking, unnecessary labor on practices whose staff must manually post payment to the bills.

Sedgwick’s non-compliance deprives providers. Every single e-bill in our system for which Sedgwick did not remit an e-EOR is an e-bill Segwick either didn’t pay, or one for which the practice was unduly forced to expend extra resources.

As our system's most significant non-compliant claims administrator, Sedgwick is single-handedly making workers’ comp less efficient, sustainable, and ineffective.

As chronicled in this space, listed below are the times daisyBill has recorded, reported, and tried to address Sedgwick’s behavior:

• An Open Letter to Sedgwick Claims Management Services, Inc.
• Sedgwick Must Be Fined: An Open Letter to the CA DWC
• CA e-EOR (835) Compliance Report 2023
• CA e-EOR Compliance: 2022 Report Card
• 25,970 Audit Complaints for missing e-EORs filed on June 22, 2022
• 31,906 Audit Complaints for missing e-EORs filed on December 14, 2022
• 21,442 Audit Complaints for missing e-EORs filed on April 20, 2023

And yet, the 2023 data above confirms, Sedgwick clearly lacks any sense of urgency — or fear of state regulators — that would motivate the TPA to get compliant.

If you are a self-insured employer that utilizes Sedgwick (or an employer whose insurer utilizes Segwick) as TPA, understand that Sedgwick is abusing the doctors who treat your employees. Sedgwick is making it harder for doctors to accept injured workers as patients, leaving your workers with fewer places to seek care.

We’ll keep reporting on the behavior of this miscreant TPA — though we have little hope it will change.

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