KEY TAKEAWAYS:

• Major changes to Utilization Review (UR) and Independent Medical Examinations (IMEs) will take effect following the passage of House Bill 5228

• HB 5228 imposes strict requirements on using an IME in lieu of UR to address the necessity of prescribed treatments, changing the way employers approach evaluating a treatment recommendation

• Delays in obtaining records, scheduling IMEs, or issuing decisions may carry steeper consequences, as failure to comply opens the door to penalties and attorney’s fees

Major changes to Utilization Review (UR) and Independent Medical Examinations (IMEs) will take effect following the passage of House Bill 5228 with veto-proof majorities. While the legislation addresses several workers’ compensation issues, the most significant changes for employers, carriers, and claims professionals involve UR and the use of IMEs to dispute medical treatment.

Same-Specialty Requirement for Utilization Review

Under HB 5228, UR determinations must be made by a physician who practices in the same specialty, or an appropriate comparable specialty, as the treating provider. The reviewing physician must also have experience treating patients with the condition at issue.

This change will create additional scrutiny of UR determinations and provide claimants a non-substantive basis to challenge adverse treatment decisions.

From a practical standpoint, employers and carriers should work closely with their UR vendors to ensure reviewer qualifications before requesting a review of any treatment.

Three-Month Treatment Certification Period

The legislation further limits the validity of UR certification to just 3 months. Importantly, when surgery is certified, the certification automatically includes three months of post-operative care.

This provision may limit opportunities to challenge certain post-surgical treatment recommendations and could result in broader treatment authorization than currently exists under some claims handling practices. However, it should also discourage any delays in treatment and could provide a basis to mitigate future medical exposures.

New Restrictions on the Use of IMEs and Added Penalty Exposure Risk

The most consequential provision in HB 5228 imposes strict requirements on using an IME in lieu of UR to address the necessity of prescribed treatments.

Under the new provision, when an IME is used in place of UR: (1) the IME physician must be in the same or an appropriate specialty as the treating physician and (2) both the examination and report must be completed 90 days after the employer receives the treatment request and supporting medical records.

Most importantly, and concerningly, if an employer fails to comply with these requirements there is a rebuttable presumption supporting penalties and attorney’s fees under Sections 16 and 19(l) of the Workers’ Compensation Act. The provision applies to both failure to authorize and failure to pay for treatment.

As a result, delays in obtaining records, scheduling IMEs, or issuing treatment decisions may now carry substantially greater risk than before.

Potential Retroactive Application

Although the bill has not yet taken effect, claimant attorneys are already taking the position that the Section 12 amendments are procedural rather than substantive and therefore apply retroactively to pending claims.

If that argument gains traction before the Commission, employers and carriers could find themselves subject to the new requirements even in cases where treatment requests predate the legislation. We expect this issue to generate significant litigation and appellate review over the coming years.

Defense Takeaways

HB 5228 signals a clear legislative effort to limit the use of IMEs as a substitute for UR and to accelerate treatment decision-making and will change how employers approach evaluating a treatment recommendation. However, it does not change or impose any deadlines or potential penalties on the use of IMEs to address causation, work restrictions, or MMI.

Employers and carriers should consider:

• Reviewing current UR vendor qualifications and specialty matching procedures.
• Promptly obtaining medical records immediately upon receipt of treatment requests.
• Securing a medical canvas at the onset of a claim to identify any prior relevant treatment and secure those records immediately to avoid any delays with an IME.
• Scheduling IMEs as early as possible when treatment reasonableness or necessity is disputed and ensuring that the IME physician is aware of the 90-day deadline for the examination and report.
• Evaluating whether disputes regarding medical treatment should proceed through UR rather than rely exclusively on a Section 12 IME.

Though these changes are significant, there is reason to be optimistic. These changes seem to signal a message to the IWCC about the weight that should be assigned to UR determinations, which are a much more cost-effective method to assess medical necessity. It can also serve to encourage claimants, providers, and IMEs to disclose records more promptly.

As with any significant changes in the law, it is important for employers, carriers, and claims professionals to consult with defense counsel on how to strategically approach questions of medical necessity as the workers’ compensation community navigates these new requirements.

If you have questions or concerns about how HB 5228 could impact your business, please contact:

• Natasa Timotijevic
• Blake W. Dust
• Emily E. Borg
• Or another member of our Workers’ Compensation Illinois team