Changes to Rule 16 Effective January 1, 2018
Everyone’s favorite Rule is getting a makeover effective January 1, 2018. There are several minor changes to the Rule that will impact prior authorization requests and ensure that a second opinion is timely obtained by the payer. The major change that will take effect is to Rule 16-11(E) and the elimination of the option for the payer to request a hearing within the time-frames set forth in Rule 16-11(A) or 16-11(B). The Division hopes to streamline the payer’s ability to contest prior authorization requests and ensure that a second opinion is obtained in a timely manner. Rule 16 was previously revised and hoped to reduce overall litigation; however, the changes to the Rule contained some ambiguities and loopholes further ensuring that clarification was needed in 2018.
The current form of Rule 16-11(E) indicates:
Failure of the payer to timely comply in full with the requirements of section 16-11(A) or (B), shall be deemed authorization for payment of the requested treatment unless:
(1) A hearing is requested within the time prescribed for responding as set forth in section 16-11(A) or (B) and the requesting provider is notified accordingly. A request for hearing shall not relieve the payer from conducting a medical review of the requested treatment, as set forth in section 16-11(B); or
(2) The payer has scheduled an independent medical examination (IME) within the time prescribed for responding as set forth in section 16-11(B).
This portion of the Rule took effect January 1, 2017 and is effective through December 31, 2017. The Rule allows the payer to request a hearing within 7 business days of the receipt of the request for prior authorization. However, it does not specify “when” the payer should conduct a medical records review. It only indicates that the obligation is there for the payer to conduct one. The Rule in subsection (2) also allows for an IME to be scheduled within 7 business days but does not delineate when the IME should take place. For the claimant, significant delay is possible in waiting for the second opinion from the IME physician. Theoretically, a payer could “schedule” an IME within 7 business days but have the IME take place at a much later date due to the availability of the IME physician.
The major changes that will be effective on New Year’s Day specifically indicate what a payer can due to contest a request for prior authorization, (if a medical records review is not possible), while taking into consideration the timeliness of obtaining the opinion for the claimant.
The new version of Rule 16-11(E) indicates:
Failure of the payer to timely comply in full with section 16-11(A), (B), or (C) shall be deemed authorization for payment of the requested treatment unless the payer has scheduled an independent medical examination (IME) and notified the requesting provider of the IME within the time frame prescribed for responding set forth in section 16-11(B).
(1) The IME must occur within 30 days, or upon first available appointment, of the prior authorization request, not to exceed 60 days absent an order extending the deadline.
(2) The IME physician must serve all parties concurrently with his or her report within 20 days of the IME.
(3) The insurer shall respond to the prior authorization request within five business days of the receipt of the IME report.
(4) If the injured worker does not attend or reschedules the IME, the payer may deny the prior authorization request pending completion of the IME.
(5) The IME shall comply with Rules 8-8 to 8-13 as applicable.
One aspect of the Rule that must be remembered by the carrier is the “first available appointment” portion of scheduling the IME. As is usually the case, an IME physician will have a busy schedule and may not have an appointment within 30 days. While an IME can still be scheduled up to the 60-day deadline with a physician of the carrier’s choice, this portion of the Rule must be complied with strictly so as to prevent delay in obtaining the second opinion for the claimant.
Another portion of the Rule that may create certain “arguments” is the duty on the IME physician and the carrier to have the report concurrently served on the parties within 20 days of the IME. Although the Rule is silent as to what happens if the report is not concurrently served, or is late, the Rule still contains the original provision that a failure to comply is deemed authorization of the particular procedure. The Rule appears to create an obligation on the payer to ensure that the IME physician is timely with his/her report.
Lastly, an ALJ always has the ultimate jurisdiction to determine whether a procedure is reasonable, necessary, and/or related to a claim since it will always involve a finding of fact. However, there is also established case law indicating that a failure to timely comply with Rule 16 and/or a failure to timely authorize a recommended procedure from an authorized treating physician could be a continuing penalty situation in which an ALJ could find that the carrier acted unreasonably and that penalties should be awarded from the date of the request through the date of authorization.
It is always best to understand the particular changes to the law well in advance of when they take effect. For any questions regarding the upcoming changes to Rule 16 and their application to a particular set of facts, please contact any of the attorneys at Lee + Kinder, LLC.