State News : California

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by Jessie Zaylia, Partner

Independent medical review (“IMR”) has survived another challenge in court.  On June 14, 2017, the California Supreme Court denied a petition for review regarding the Third District Court of Appeal’s decision inRamirez v. WCAB (2017) 10 Cal.App.5th 205.

The applicant raised constitutional challenges to IMR, claiming that IMR violates both the California Constitution and the United States Constitution.  The court rejected each of the petitioners’ challenges and upheld the constitutionality of IMR.

The petitioners argued that IMR violated the California Constitution’s separation of powers and due process clauses.  The court embracedStevens v. WCAB to reject this argument. In Stevens, the court noted that Article XIV, Section 4 of the California Constitution vests the legislature “with plenary power,unlimited by any provision of this Constitution, to create, and enforce a complete system of workers’ compensation, by appropriate legislation.”  It found, however, that the constitution’s separation of powers and due process clauses yield to Section 4: the separation of powers clause does so expressly, whereas the due process clause excludes amendments “as to the subject matter of the new provision.”  Relying on theStevens court’s findings, the court held that IMR did not violate these constitutional clauses.

The petitioner also argued that IMR conflicted with Section 4 of the due process clause since Labor Code section 4610.6(i) restricts the ability of appellate courts to review IMR determinations.  TheRamirez court, however, “perceive[d] no conflict.”  It noted that Section 4 requires that all WCAB decisions are “subject to review by the appellate courts [. . .].”  It also noted that section 4610.6(i) only prohibits appellate courts from making a determination contrary to “determination of the independent medical review organization.”  The petitioner argued that section 4610.6(i)’s language does not permit a court of appeal to review the Board’s decision as required by Section 4.  The court opined, however, that section 4610.6(i) does not “impair[] the ability of the appellate courts to review decisions of the Board,” as an applicant may petition a court for review on grounds enumerated in section 4610.6(h).  For this reason, the court held that IMR did not conflict with Section 4.

Lastly, the petitioner argued that IMR “strip[ped] him of his right to a substantive appeal” as an appellate court could not make a determination contrary to IMR.  The court rejected this challenge by reference toStevens.  The Stevens court noted that due process requires that a state provide someone “sufficient notice and opportunity to be heard” before “depriv[ing] them of a property or liberty interest [. . .].”  It found that IMR presented a low “risk of erroneous deprivation of [medical] services” to applicants and that the government had a compelling interest when it established IMR.  As such, theStevens court concluded that an applicant “is afforded ample process.”  Agreeing withStevens’s conclusion, the court in Ramirez held that “the [IMR] process in its entirety provides sufficient due process protections” to applicants.

This is the second district to reject a constitutional challenge to IMR and the second time that the California Supreme Court has refused to review an appellate court’s decision.  As it stands, IMR looks as though it is here to stay.