(June 19, 2007) The California Chamber of Commerce recently filed a “friend of the court” brief to protect medical provider networks and their ability to control costs under the successful workers’ compensation reforms of 2004.
In the case of Palm Medical Group, Inc. v. State Compensation Insurance Fund (SCIF), the issue before the court is whether the common law doctrine of “fair procedure” extends to situations where a group seeks admittance to a medical provider network. Palm Medical Group is attempting to apply the doctrine of “fair procedure” in order to challenge SCIF’s decision to deny Palm's request to be in its medical provider network.
Read the brief.
The CalChamber believes that the Palm decision will set a precedent for medical provider networks in the post-workers’ compensation reform era.
In its brief, the CalChamber argues that the Legislature’s intent in implementing the workers’ compensation reforms was to reduce the skyrocketing cost of workers’ compensation premiums for California employers.
The CalChamber is most concerned that an unfavorable ruling in this case will undermine the Legislature’s efforts to reduce costs by preventing fraud and ensuring medically appropriate care through the creation of medical provider networks.
The Legislature’s reforms clearly state that, “in developing a medical provider network, an employer or insurer shall have the exclusive right to determine the members of their network.”
2004 Reforms
The reform legislation, CalChamber-supported SB 899 (Poochigian; R-Fresno) made fundamental changes in the way the workers’ compensation system determines the level of injury and the amount of disability assigned to an injury, and created a new medical network to provide quality, cost-effective care to workers.
The reform package ensured that medical treatment follows nationally recognized guidelines and set clear parameters for what is acceptable treatment for injured workers in the system, while also reducing excessive litigation.
Read the brief.
Staff Contact: Erika Frank