Chorn v. Workers' Comp. Appeals Bd.

245 Cal.App.4th 1370

200 Cal.Rptr.3d 74

Robin CHORN et al., Petitioners,

v.WORKERS' COMPENSATION APPEALS BOARD et al., Respondents;

Kamala Harris et al., Real Parties in Interest.

B264440

Court of Appeal, Second District, Division 4, California.

Filed March 28, 2016

As Modified on Denial of Rehearing April 20, 2016

Matthew D. Rifat for Petitioners.

Kamala D. Harris, Attorney General, Kathleen A. Kenealy, Chief Assistant Attorney General, Kristin G. Hogue, Assistant Attorney General, Joel A. Davis and Donna M. Dean, Deputy Attorneys General for Respondent and Real Parties in Interest.

COLLINS, J.

Physician Robin Chorn, M.D. and workers' compensation applicants Robert Kalestian, Tanya Vounov, and Latasha Buie have petitioned this court for a writ of mandate enjoining respondent Workers' Compensation Appeals Board (WCAB) from enforcing two recently enacted provisions of the Labor Code, sections 4903.05 and 4903.8.¹ Petitioners contend that section 4903.05, which imposes a filing fee of $150 on certain medical liens filed in workers' compensation cases, deprives them of their state constitutional rights to due process (Cal. Const., art. I, § 7 ), equal protection (Cal. Const., art. I, § 9 ), and petition for redress of grievances (Cal. Const., art. I, § 3 ). Petitioners claim that section 4903.8, which restricts payment of lien awards to individuals other than those who incurred the expenses, substantially impairs their constitutional right to contract. (Cal. Const., art. I, § 9.) Finally, they argue that both statutes contravene the constitutional mandate that workers' compensation laws "accomplish substantial justice in all cases expeditiously, inexpensively, and without any incumbrance of any character." (Cal. Const., art. XIV, § 4.)

We conclude that petitioners Kalestian, Vounov, and Buie lack standing to obtain the writ relief they request. We further conclude that the challenged provisions of sections 4903.05 and 4903.8 do not violate any of the constitutional provisions identified in the petition. We accordingly dismiss the petition as to petitioners Kalestian, Vounov, and Buie and deny the petition as to petitioner Chorn.

BACKGROUND

I. The Workers' Compensation System

"Article XIV, section 4 of the California Constitution gives the Legislature ‘plenary power ... to create, and enforce a complete system of workers' compensation.’ " (Charles J. Vacanti, M.D., Inc. v. State Comp. Ins. Fund (2001) 24 Cal.4th 800, 810, 102 Cal.Rptr.2d 562, 14 P.3d 234 (Vacanti ).) Pursuant to this authority, the Legislature enacted the Workers' Compensation Act, "a comprehensive statutory scheme governing compensation given to California employees for injuries incurred in the course and scope of their employment. (§ 3201 et seq.)" (Ibid. )

Under the workers' compensation statutes, "an employee injured in the workplace may request workers' compensation benefits by delivering a claim form to the employer within 30 days of the injury. [Citations.] Benefits include compensation for medical treatment and other services ‘reasonably required to cure or relieve [the employee] from the effects of the injury.’ [Citations.]" (Vacanti, supra, 24 Cal.4th at p. 810, 102 Cal.Rptr.2d 562, 14 P.3d 234.) Employers or their workers' compensation insurers assume liability for these benefits owed to the employee. (Ibid. ) This arrangement is in essence a " ‘compensation bargain.’ " (Id. at p. 811, 102 Cal.Rptr.2d 562, 14 P.3d 234.) " ‘[T]he employer assumes liability for industrial personal injury or death without regard to fault in exchange for limitations on the amount of that liability. The employee is afforded relatively swift and certain payment of benefits to cure or relieve the effects of industrial injury without having to prove fault but, in exchange, gives up the wider range of damages potentially available in tort.’ [Citation.]" (Ibid. )

Employers are obligated to provide medical, surgical, chiropractic, acupuncture, and hospital treatment that is reasonably required to cure or relieve an injured worker from the effects of his or her injury. (§ 4600, subd. (a).) "Upon notice of the injury, the employer must specifically instruct the employee what to do and whom to see, and if the employer fails or refuses to do so, then he loses the right to control the employee's medical care and becomes liable for the reasonable value of self-procured medical treatment." (Braewood Convalescent Hospital v. Workers' Compensation Appeals Board (1983) 34 Cal.3d 159, 165, 193 Cal.Rptr. 157, 666 P.2d 14.) Employers and their insurers may establish or contract with a medical provider network to treat injured employees. (§§ 4600, subd. (c), 4616.) An injured employee may visit medical providers outside such networks only if the employer has not established a network or if the employee notified the employer in writing prior to the date of injury that he or she has a personal physician. (§ 4600, subds. (c), (d).) Medical providers submit itemized bills to the employer or its insurer, which generally has 60 days after receipt in which to pay. (Vacanti,supra, 24 Cal.4th at pp. 810–811, 102 Cal.Rptr.2d 562, 14 P.3d 234 ; §§ 4603.2, subd.(b)(1), 4622.) If the employer or insurer contests a bill or portion thereof, the employer or insurer need not pay the contested portion until ordered to do so by the WCAB. (Vacanti,supra, 24 Cal.4th at p. 811, 102 Cal.Rptr.2d 562, 14 P.3d 234 ; see §§ 4603.2, subd. (b), 4622, subd. (a).)

A medical provider whose bill is contested or otherwise unpaid generally may not seek payment from the employee. (§ 3751.) The provider may, however, file a lien claim for the costs of his or her services directly with the WCAB. (Vacanti,supra, 24 Cal.4th at p. 811, 102 Cal.Rptr.2d 562, 14 P.3d 234 ; §§ 4903, 5300.) The filing of a lien claim renders the medical provider a party in interest to the WCAB proceedings and endows the provider with "full due process rights, including an opportunity to be heard." (Vacanti,supra, 24 Cal.4th at p. 811, 102 Cal.Rptr.2d 562, 14 P.3d 234.) "Because injured workers and their employers are often ready to resolve the worker's claim for indemnity before resolution of claims by lien claimants, the law grants a lien claimant an independent right to prove its claims in a separate proceeding. (Lab.Code, § 4903.4.)" (California Insurance Guarantee Association v. Workers' Compensation Appeals Board (2012) 203 Cal.App.4th 1328, 1343, 138 Cal.Rptr.3d 24.) A lien claimant also may initiate an action if the injured worker does not pursue his or her own claim. (Ibid. ; § 5501.)

II. Senate Bill 863 and the Contested Statutes

In 2012, the Legislature enacted Senate Bill 863 (SB 863) (2011–2012) to reform the lien claim system, among other things. (Stats. 2012, ch. 363, §§ 63, 70.) Respondent and real parties in interest, respectively, former and present Attorneys General, Edmund G. Brown [, Jr.] and Kamala D. Harris have made an unopposed request for judicial notice of some of the legislative history of SB 863, as well as a decision of the WCAB. We grant the request and take judicial notice of the proffered materials. (Evid.Code §§ 452, subds. (a) & (c), 459 ; see In re J.W. (2002) 29 Cal.4th 200, 211, 126 Cal.Rptr.2d 897, 57 P.3d 363.)

The legislative history of SB 863 described the lien payment system as "out of control." (Sen. Rules Com., Off. of Senate Floor Analyses, analysis of Sen. Bill No. 863 (2011–2012 Reg. Sess.) as amended August 30, 2012, at p. 16.) The legislative analysis stated that "hundreds of thousands of backlogged liens, possibly in excess of a million" were clogging the workers' compensation system. (Ibid. ) It described an environment in which courts were overwhelmed and "lien abuse" was common, where medical providers and third parties who purchased old receivables from medical providers commonly filed frivolous lien claims and used the delays in the system to leverage excessive settlements. (Ibid. ) "To address this growing volume of problem liens," the analysis explained, SB 863 proposed "to re-enact a lien filing fee, so that potential filers of frivolous liens have a disincentive to file." (Ibid. ) The analysis further stated that the filing fee would be refundable if the lien claimant prevailed. (Id. at pp. 16–17.)

The passage of SB 863 resulted in the enactment of several new workers' compensation statutes, two of which are pertinent here: sections 4903.05 and 4903.8.

Section 4903.05 provides in pertinent part: "(c) All liens filed on or after January 1, 2013, for expenses under subdivision (b) of Section 4903 or for claims of costs shall be subject to a filing fee as provided by this subdivision. [¶] (1) The lien claimant shall pay a filing fee of one hundred fifty dollars ($150) to the Division of Workers' Compensation prior to filing a lien and shall include proof that the filing fee has been paid.... [¶] (2) On or after January 1, 2013, a lien submitted for filing that does not comply with paragraph (1) shall be invalid, even if lodged with the appeals board, and shall not operate to preserve or extend any time limit for filing of the lien. [¶] ... [¶] (7) No filing fee shall be required for a lien filed by a health care service plan licensed pursuant to Section 1349 of the Health and Safety Code, a group disability insurer under a policy issued in this state pursuant to the provisions of Section 10270.5 of the Insurance Code, a self-insured employee welfare benefit plan, as defined in Section 10121 of the Insurance Code, that is issued in this state, a Taft–Hartley health and welfare fund, or a publicly funded program providing medical benefits on a nonindustrial basis." (§ 4903.05, subds. (c)(1), (2) & (7).) Thus, effective January 1, 2013, certain medical providers must pay a fee of $150 to file their lien claims with the WCAB. The filing fees are used for the purposes of the Workers' Compensation Administration Revolving Fund (§ 4903.05, subd. (c)(4) ), a special account in the State Treasury used in...