J. Burgess v. WCAB (Patterson-UTI Drilling Co. LLC)

IN THE COMMONWEALTH COURT OF PENNSYLVANIA
James Burgess, :
Petitioner :
:
v. :
:
Workers’ Compensation Appeal Board :
(Patterson-UTI Drilling Company LLC), : No. 778 C.D. 2019
Respondent : Submitted: March 24, 2020
BEFORE: HONORABLE MARY HANNAH LEAVITT, President Judge
HONORABLE RENÉE COHN JUBELIRER, Judge
HONORABLE ANNE E. COVEY, Judge
OPINION BY
JUDGE COVEY FILED: May 1, 2020
James Burgess (Claimant) petitions this Court for review of the
Workers’ Compensation (WC) Appeal Board’s (Board) May 29, 2019 order
affirming the Workers’ Compensation Judge’s (WCJ) decision granting the Petition
for Review of Utilization Review (UR) Determination (UR Petition) filed by
Patterson-UTI Drilling Company, LLC (Employer). Claimant presents three issues
for this Court’s review: (1) whether the WCJ had jurisdiction under the WC Act1
(Act) and the Department of Labor & Industry’s (Department) Regulations to
determine whether Claimant’s care should be transferred from a long-term acute care
(LTAC) facility to a skilled nursing facility; (2) whether the WCJ’s decision was
based on substantial evidence; and (3) whether the WCJ rendered a reasoned
decision.
On December 14, 2012, Claimant sustained a severe work-related injury
while in the scope and course of his employment and, on December 28, 2012,
1
Act of June 2, 1915, P.L. 736, as amended, 77 P.S. §§ 1-1041.4, 2501-2710.
Employer filed a Notice of Temporary Compensation Payable (NTCP), accepting the
injury as tetraplegia.2 The NTCP converted to a Notice of Compensation Payable
(NCP) by operation of law.
Since December 2014, Claimant has resided at an LTAC facility. In
August 2016, Employer filed a request seeking a UR determination regarding the
reasonableness and necessity of Claimant’s continued presence at the LTAC facility.
On August 24, 2016, the Department’s Bureau of Workers’ Compensation (Bureau)
notified Employer by document titled “Return of [UR] Request” (Return of UR
Request) that it was returning the UR request without assigning it to a UR
Organization (URO) because the “treatment to be reviewed is not a healthcare service
. . . . Determining where the healthcare service is being provided cannot be
determined by a reviewer.” Reproduced Record (R.R.) at 10a (emphasis added).
Thereafter,3 Employer again requested review of the reasonableness and necessity of
Claimant’s stay at the LTAC facility and, on September 22, 2016, the Bureau issued a
Return of UR Request, referencing its August 24, 2016 Return of UR Request, and
returned the UR Request without assigning it to a URO for a UR review.
On October 27, 2016, Employer filed a UR request to determine the
reasonableness and necessity of Claimant’s treatment from providers at the LTAC
facility: Ikechukwu Unezurike, M.D., Mariejane Braza, M.D., Julie Philley, M.D.,
and Mukakeer Shaik, M.D. On December 28, 2016, the URO issued a UR
determination (Unezurike UR Determination) concluding that the reviewed medical
treatment was reasonable and necessary based on Claimant’s medical conditions and
because the providers were employed at the LTAC facility where Claimant resides.
Employer also filed a UR request with respect to Claimant’s treatment by Troy
Callender, M.D. (Dr. Callender). On December 28, 2016, the assigned URO issued a
2
Tetraplegia is also known as quadriplegia.
3
The record is unclear regarding the specific date Employer made the subsequent request.
2
UR determination (Callender UR Determination) concluding Dr. Callender’s
treatment was reasonable and necessary.
On January 13, 2017, Employer filed the UR Petition, wherein it sought
review of the Unezurike UR Determination and the Callender UR Determination.
The WCJ held hearings on February 22 and December 19, 2017. At the hearings,
Employer clarified on the record that it was not alleging that the providers’ treatment
was not reasonable or necessary, but rather that Employer filed the UR Petition to
permit the WCJ to address the reasonableness and necessity of Claimant’s continued
residency at the LTAC facility as opposed to a skilled nursing facility. See R.R. at
55a-56a, 79a-80a. Employer submitted the Unezurike UR Determination and the
Callender UR Determination to the WCJ. It also offered into evidence the Bureau’s
August 24 and September 22, 2016 Return of UR Requests. In addition, Employer
introduced expert Lucian Bednarz, M.D.’s deposition testimony.
Claimant presented no evidence on the reasonableness and necessity of
Claimant’s continued residency at the LTAC facility. Based on the evidence
presented, the WCJ concluded that Employer had sustained its burden of
demonstrating that Claimant’s continued stay at the LTAC facility was not reasonable
and necessary, and that Claimant should be moved to a skilled nursing facility.
Claimant appealed to the Board, arguing that the WCJ lacked jurisdiction to
determine that Claimant’s care should be transferred, that Employer should have filed
a different petition to transfer Claimant’s care, that substantial evidence did not
support the WCJ’s decision to transfer Claimant to a skilled nursing facility, and that
the WCJ had failed to render a reasoned decision.
On May 29, 2019, the Board affirmed the WCJ’s order, concluding that
the WCJ had jurisdiction to address whether Claimant’s care should be transferred
from the LTAC facility as follows:
3
The WCJ does not have subject matter jurisdiction to
determine the reasonableness and necessity of medical
treatment and order specific treatment be paid by
[Employer] until the parties undergo the mandatory UR
procedures and a UR Determination has been rendered on
the issue. Thereafter, during a UR Petition, the parties
are entitled to argue in front of the WCJ that he should
consider any alleged deficiency in the UR process which
may have affected the UR Determination, such that the
WCJ may undergo a fair assessment of the evidence
before him. Moreover, the WCJ has the authority to grant
the relief requested by the moving party, so long as the
evidence supports such relief, the adverse party is on notice
of the specific relief requested, and the adverse party has
had a fair opportunity to defend against the allegations.
The WCJ did not have jurisdiction to review whether
Claimant’s continued stay in an LTAC facility was
reasonable and necessary until the required UR process
was met. [Employer] originally filed a UR Request to
specifically address this issue but it was returned by the
Bureau with a note that the URO could not properly
review the issue. Thereafter, [Employer] filed the UR
Requests challenging the reasonableness and necessity of
Claimant’s various LTAC physicians, so that it could
present its arguments to the WCJ that the UR process is
deficient because it does not allow [Employer] to request a
review of [Claimant’s] level of care.
R.R. at 95a-96a (emphasis added; citations omitted). The Board also concluded that
the WCJ’s decision was based on substantial evidence, in that “Dr. Bednarz’s
credible and uncontradicted testimony specifically addressed the reasons why
Claimant should be transferred to a skilled nursing facility . . . .” R.R. at 97a.
Finally, the Board concluded that the WCJ had issued a reasoned decision which
allowed for effective judicial review. Claimant appealed to this Court.4
4
“Our scope of review is limited to determining whether constitutional rights have been
violated, whether an error of law was committed and whether necessary findings of fact are
supported by substantial evidence.” Torijano v. Workers’ Comp. Appeal Bd. (In A Flash
Plumbing), 168 A.3d 424, 428 n.3 (Pa. Cmwlth. 2017).
4
Initially, “the overall remedial purpose and humanitarian objective of the
WC Act . . . is intended to benefit the injured worker.” Whitfield v. Workers’ Comp.
Appeal Bd. (Tenet Health Sys. Hahnemann LLC), 188 A.3d 599, 616 (Pa. Cmwlth.
2018). Further,
[t]he purpose of the [UR] process is[]
to encourage payment of medical bills in cases
that are treated, at least initially, as medical
only. Were insurers unable to avail themselves
of the UR process, they might well be less
inclined to pay, voluntarily, for medical
treatment, thus, resulting in more litigation.
The present system encourages payment of
medical bills by providing insurers with a
method to limit payments where they believe
treatment becomes unnecessary and
unreasonable.
Armstrong v. Workers’ Comp. Appeal Bd. (Haines & Kibblehouse, Inc.), 931 A.2d
827, 831 (Pa. Cmwlth. 2007) (quoting Krouse v. Workers’ Comp. Appeal Bd.
(Barrier Enters., Inc.), 837 A.2d 671, 675 (Pa. Cmwlth. 2003)).
Section 306(f.1)(6) of the Act provides, in relevant part:
[D]isputes as to reasonableness or necessity of treatment by
a health care provider shall be resolved in accordance with
the following provisions:
(i) The reasonableness or necessity of all
treatment provided by a health care provider
under this [A]ct may be subject to prospective,
concurrent or retrospective [UR] at the request
of an employe, employer or insurer. The
[D]epartment shall authorize [UROs] to
perform [UR] under this [A]ct. [UR] of all
treatment rendered by a health care provider
shall be performed by a provider licensed in
the same profession and having the same or
similar specialty as that of the provider of the
treatment under review. Organizations not
5
authorized by the [D]epartment may not
engage in such [UR].
(ii) The [URO] shall issue a written report of
its findings and conclusions within thirty (30)
days of a request.
(iii) The employer or the insurer shall pay the
cost of the [UR].
(iv) If the provider, employer, employe or
insurer disagrees with the finding of the
[URO], a petition for review by the
[D]epartment must be filed within thirty (30)
days after receipt of the report. The
[D]epartment shall assign the petition to a
[WCJ] for a hearing or for an informal
conference under [S]ection 402.1 [of the Act,
77 P.S. § 711.15]. The [UR] report shall be
part of the record before the [WCJ]. The
[WCJ] shall consider the [UR] report as
evidence but shall not be bound by the report.
77 P.S. § 531(6).
This Court has explained:
The . . . [UR] process is the exclusive way to challenge
medical bills. Neither a WCJ nor the Board has
jurisdiction to determine the reasonableness of medical
treatment unless and until a report is issued and the
URO issues a determination. Parties may not, even by
stipulation, agree to bypass [UR] and proceed directly to
a hearing before a WCJ.
If the health care provider, employer, employee or insurer
disagrees with the determination of the URO, he may,
within 30 days of the URO’s determination, seek review by
a WCJ. This hearing before the WCJ is a de novo
proceeding; the WCJ is required to consider the reviewer’s
report as evidence, but he is not bound by it.
5
Section 402.1 of the Act was added by Section 13 of the Act of June 24, 1996, P.L. 350.
6
Cty. of Allegheny v. Workers’ Comp. Appeal Bd. (Geisler), 875 A.2d 1222, 1226-27
(Pa. Cmwlth. 2005) (emphasis added; citations and footnote omitted). In a “WCJ
review of a UR determination[,] . . . ‘either party is free to offer evidence beyond that
considered in the UR process in meeting their [sic] burden of proof.’” The Rd. Toad,
Inc. v. Workers’ Comp. Appeal Bd. (McLean), 8 A.3d 922, 924 (Pa. Cmwlth. 2010)
(quoting Seamon v. Workers’ Comp. Appeal Bd. (Sarno & Son Formals), 761 A.2d
1258, 1262 (Pa. Cmwlth. 2000)). Importantly, “[t]he [WCJ] has jurisdiction over
all [UR] petitions and any alleged technical deficiency or irregularity in the [UR]
process; the de novo hearing before the [WCJ] provides for a fair review in which
both parties [are] free to offer other evidence.” Carter v. Workers’ Comp. Appeal Bd.
(Hertz Corp.), 790 A.2d 1105, 1109 (Pa. Cmwlth. 2002) (bold emphasis and italic
added).
Notwithstanding,
[UR] is not an alternative to a review by a WCJ, but a
mandatory first step in determining whether a provider’s
treatment is reasonable and necessary. This Court has
consistently held that a WCJ lacks subject matter
jurisdiction to determine the reasonableness and
necessity of medical treatment if the matter has not first
gone to [UR].
Cty. of Allegheny, 875 A.2d at 1228 (emphasis added).
Claimant first argues that the WCJ lacked jurisdiction to determine
whether Claimant’s care should be transferred from an LTAC facility to a skilled
nursing facility because that determination was beyond the scope of permissible UR
consideration, and should have been raised in a petition to review medical treatment.
Claimant acknowledges the general rule that “strictness of pleadings in
WC proceedings is not required. If one party effectively puts the adverse party on
notice as to the theory of relief that it is seeking, the WCJ will be authorized to grant
the relief requested [(General Rule)].” Lake v. Workers’ Comp. Appeal Bd.
7
(Whiteford Nat’l Lease), 746 A.2d 1183, 1187 (Pa. Cmwlth. 2000) (citation omitted);
see also Ohm v. Workmen’s Comp. Appeal Bd. (Caloric Corp.), 663 A.2d 883, (Pa.
Cmwlth. 1995). Nonetheless, Claimant argues the General Rule is inconsistent with
the UR process which “is unique in that it is narrow in scope, limited to the
reasonableness or necessity of the treatment at issue, and governed by specific and
extensive regulations set forth at [Sections 127.401-556 of the Department’s
Regulations,] 34 Pa. Code §§ 127.401-556.” Claimant Br. at 11. In support,
Claimant specifically references Section 127.406 of the Department’s Regulations,
which provides:
(a) UROs shall decide only the reasonableness or
necessity of the treatment under review.
(b) UROs may not decide any of the following issues:
(1) The causal relationship between the treatment under
review and the employe[e]’s work-related injury.
(2) Whether the employe[e] is still disabled.
(3) Whether ‘maximum medical improvement’ has been
obtained.
(4) Whether the provider performed the treatment under
review as a result of an unlawful self-referral.
(5) The reasonableness of the fees charged by the
provider.
(6) The appropriateness of the diagnostic or procedural
codes used by the provider for billing purposes.
(7) Other issues which do not directly relate to the
reasonableness or necessity of the treatment under
review.
34 Pa. Code § 127.406 (emphasis added).
Based thereon, Claimant contends that Section 127.406(b)(7) of the
Department’s Regulations prohibited the URO from considering whether Claimant’s
8
receipt of care at the LTAC facility was reasonable and necessary, because
Claimant’s presence at the facility did “not directly relate to the reasonableness or
necessity of the treatment under review” as described therein, and accordingly, it was
improper for the WCJ to consider the issue. 34 Pa. Code § 127.406(b)(7).
Employer responds:
Claimant cannot and has not shown how the current
decision does not fit within the realm of what a Petition for
Review of [UR] Determination can review or how it is
within the categories of determinations that the [URO]
cannot review. See 34 Pa. Code § 127.406(b)(1-7). While
highlighting [Section 127.406(b)(]7[) of the Department’s
Regulations], ‘[o]ther issues which do not directly relate to
the reasonableness or necessity of the treatment under
review,’ Claimant has not and cannot argue that the
treatment in a[n] LTAC [facility] ‘does not directly relate to
the treatment under review.’ Id. at (b)(7). In fact, they are
inherently related. The only difference is that instead of the
general reasonableness of treatment in the facility by certain
providers, here it is whether the location of treatment is
reasonable and necessary. The question is whether it is
reasonable and necessary to continue treatment in a[n]
LTAC [facility] when there is available treatment, arguably
better treatment, available at a skilled long[-]term care
facility.
Claimant’s arguments about the intent and interactions
between statutory provisions is not applicable in this
situation when there is a strict interplay between the
reasonableness and necessity of treatment, and where that
treatment occurs. Employer filed the [UR Petition] not to
challenge the specific medical treatment itself, but to
challenge providing this treatment at a[n] LTAC [facility].
What the treatment is and where the treatment occurs are
inherently related even if the Bureau forms do not allow it
to be worded in that manner.
Employer Br. at 11-12. This Court agrees.
Nothing in Section 127.406(b) of the Department’s Regulations prohibits
a URO from reviewing whether Claimant’s care at the LTAC facility was reasonable
9
and necessary. In fact, this Court discerns the critical question before the Bureau and
the WCJ to be whether Claimant’s presence at the LTAC facility is reasonable or
necessary for the reviewed providers’ treatment to be effective – an issue “directly
relate[d] to the reasonableness or necessity of the treatment under review.” 34 Pa.
Code § 127.406(b)(7). Employer twice filed UR requests to review the
reasonableness or necessity of Claimant’s continued presence at the LTAC facility,
and the Bureau twice erroneously rejected them as an improper subject for UR. See
R.R. at 8a-11a. Clearly, the WCJ had jurisdiction to address “any alleged technical
deficiency or irregularity in the [UR] process.” Carter, 790 A.2d at 1109. However,
because the Bureau erroneously declined to refer the request to a URO, the WCJ
should have directed the Bureau to do so.
Because a URO never conducted a UR with respect to the
reasonableness or necessity of Claimant’s LTAC facility stay, the WCJ did not have
jurisdiction to render a decision on that substantive issue. See Cty. of Allegheny.
This Court is unwilling to hold that the WCJ had jurisdiction to consider Claimant’s
presence at the LTAC facility - an issue relating to the reasonableness or necessity of
Claimant’s medical treatment - where no UR had been performed thereon and no
determination had been rendered by a URO, because doing so would be contrary to
this Court’s holding in County of Allegheny.6 Having concluded that Employer’s UR
determination requests regarding the reasonableness and necessity of Claimant’s
continued stay at the LTAC facility were not prohibited by Section 127.406(b) of the
Department’s Regulations and should have been referred for a UR determination, the
6
Further, had the instant issue come within the enumerated prohibitions in Section
127.406(b) of the Department’s Regulations, this Court would conclude that the WCJ lacked
jurisdiction to address it despite the General Rule, because permitting the WCJ on de novo review to
decide an issue explicitly prohibited by Section 127.406(b) of the Department’s Regulations would
be contrary to law. See Snizaski v. Workers’ Comp. Appeal Bd. (Rox Coal Co.), 891 A.2d 1267,
1277 (Pa. 2006) (“substantive regulations, when properly enacted . . . , have the force of law and
enjoy a general presumption of reasonableness”).
10
WCJ should have remanded the issue to the Bureau with direction that the Bureau
refer Employer’s request to a URO.
For all of the above reasons, the Board’s decision is vacated, and the
matter is remanded to the Board with instructions to vacate the WCJ’s order and
remand the matter to the WCJ to direct the Bureau to refer the issue of the
reasonableness or necessity of Claimant’s presence at an LTAC facility to a URO for
a UR determination.7
___________________________
ANNE E. COVEY, Judge
Judge Fizzano Cannon did not participate in the decision in this case.
7
Although Employer requests this Court to affirm the Board’s decision, the Court may not
do so for the aforementioned reasons. Notwithstanding, this Court’s decision affords Employer
what it believed was required (and twice requested) – URO review of the reasonableness and
necessity of Claimant’s stay at the LTAC facility.
Having concluded that the WCJ did not have jurisdiction to consider the issue absent a
completed URO determination thereon, this Court does not address Claimant’s issues pertaining to
whether the WCJ’s decision was based on substantial evidence, and whether the WCJ rendered a
reasoned decision.
11
IN THE COMMONWEALTH COURT OF PENNSYLVANIA
James Burgess, :
Petitioner :
:
v. :
:
Workers’ Compensation Appeal Board :
(Patterson-UTI Drilling Company LLC), : No. 778 C.D. 2019
Respondent :
ORDER
AND NOW, this 1st day of May, 2020, the Workers’ Compensation
Appeal Board’s (Board) May 29, 2019 Order is vacated, and the matter is remanded
to the Board with instructions to vacate the Workers’ Compensation Judge’s (WCJ)
order and remand the matter to the WCJ to direct the Bureau of Workers’
Compensation to refer the issue of the reasonableness or necessity of James Burgess’s
presence at a long-term acute care facility to a Utilization Review (UR) Organization
for a UR determination.
Jurisdiction is relinquished.
___________________________
ANNE E. COVEY, Judge