California High Court: Workers’ Comp Law Provides Exclusive Remedy in Utilization Review Case

By | August 23, 2018

The California Supreme Court issued an opinion today that utilization review physicians cannot be sued for malpractice, upholding established law that the workers’ comp system provides injured employees an exclusive remedy against an employer for compensable work-related injuries.

The court considered the application of workers’ comp exclusivity to claims arising from the utilization review process. Utilization reviewers act on behalf of employers and determine whether the treatment plan recommended for an employee’s injury is medically necessary after consulting a schedule of uniform treatment guidelines.

If the reviewer concludes that a recommended treatment is not medically necessary, the treatment request may be denied.

In 2008, Kirk King sustained a back injury while at work, and reportedly suffered chronic pain as a result of the injury, which in turn caused him anxiety and depression. In 2011, a mental health professional prescribed psychotropic drugs, including Klonopin, to treat King.

Dr. Naresh Sharma, an anesthesiologist employed by defendant CompPartners Inc., a licensed workers’ comp utilization review management company, conducted a utilization review in 2013 of King’s Klonopin prescription and determined the drug was medically unnecessary and decertified the prescription.

Sharma’s decertification did not provide for a weaning regimen, nor did Sharma warn King of the risks of abruptly ceasing Klonopin. King immediately stopped taking the medication and suffered a series of four seizures as a result.

In 2014, King and his wife filed a complaint in superior court against CompPartners and Sharma among others.

The Kings asserted claims including negligence, professional negligence, and intentional and negligent infliction of emotional distress.

The defendants demurred, arguing that the Kings’ claims were preempted by the Workers’ Compensation Act, and they argued that the negligence claims failed because Sharma owed no duty of care to King.

The trial court agreed with both arguments and sustained the demurrer without leave to amend. The Court of Appeal affirmed the order sustaining the demurrer but reversed the denial of leave to amend. The Court of Appeal also held that Sharma owed King a duty of care.

The California Supreme Court in today’ opinion affirmed the Court of Appeal’s judgment insofar as it affirmed the trial court’s sustaining of the demurrer, but it reversed its judgment insofar as it permitted the Kings to amend their complaint to bolster their claim that defendants are liable in tort for failure to warn.

The case has been remanded to the Court of Appeal for further proceedings consistent with this opinion.

“We conclude that the workers’ compensation law provides the exclusive remedy for the employee’s injuries and thus preempts the employee’s tort claims,” the opinion states.

The American Insurance Association, which filed an amicus brief in the case, issued the following statement:

“Governor Brown, a bipartisan legislature, and labor/employer representatives smartly created a treatment dispute resolution process which has led to a safer and more efficient workers’ compensation system in California. We applaud the state’s Supreme Court for upholding those reforms today. We remain committed to ensuring that injured workers receive the highest quality and most appropriate medical care to foster prompt recovery and a timely return to work.”

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