State News : California

Overview

The California Division of Workers' Compensation (DWC) has adopted updated regulations governing the utilization review (UR) process under Labor Code § 4610. These regulations, effective April 1, 2026, do not alter the statutory framework itself but build a more detailed administrative layer on top of it — adding new procedural requirements for UR plans, approval and denial communications, and the IMR application process. The changes are designed to increase transparency, standardize decision communications, and tighten documentation requirements.

I. UR Plan Administration (§ 9792.7 and § 9792.7.1)

New UR-01 Cover Form. The DWC has introduced a standardized UR-01 form (§ 9792.7.1) that must be used as a cover page when establishing a new UR plan or submitting any plan modification. The form is available on the DWC's regulations page. Note that a "city" field was inadvertently omitted from the form and is expected to be corrected in April 2026; in the interim, city information should be included in the general address field.

Client List Maintenance. UR organizations are now required to keep their client lists current. Under the updated § 9792.7(c), UROs must identify the claims administrator clients for whom they perform any UR functions. This is a new affirmative obligation, UROs and the claims administrators who contract with them should confirm their processes account for this.

DWC Review and Approval Process. The updated regulations formalize a review and approval process for UR plans under § 9792.7. This is a newly added procedural layer, and organizations should review the regulation text for specific submission and compliance requirements.

II. UR Approval Letters (§ 9792.9.4)

The new regulations impose several additional content requirements for written UR approval decisions:

Documenting Prior Information Requests. If a request for additional information, testing, consultation, or examination preceded the approval, the approval letter must now include both the date the request for such information was made and the date the information was received. This creates a documented audit trail within the approval itself.

Generic Drug Substitution. When a treating physician requests a name-brand drug without specifying "do not substitute" or "dispense as written," the approval of the generic equivalent must affirmatively state "generic substitute authorized" or words to that effect. This standardizes language around formulary substitution and removes ambiguity.

Formulary-Exempt Drug Approvals. If the approved drug is exempt under the MTUS Drug Formulary, the decision must state "Exempt per MTUS Drug Formulary" or equivalent language.

30-Day Exempt Non-Drug Treatment. For approvals of non-drug treatment exempt under the 30-day rule (§ 9792.9.7), the written decision must identify the treatment as a "30-day exemption" or words to that effect.

Practical Impact: These are template-level changes, but they require updates to approval letter workflows. Claims administrators and UROs should audit their current letter templates against these requirements before April 1.

III. UR Denial and Modification Letters (§ 9792.9.5)

Responding to Treating Physician Opinions on Guidelines. This is a notable addition. When a requesting physician expressly includes in the RFA an opinion that prerequisite treatment or guideline criteria should be overlooked or deemed irrelevant, the reviewing UR physician must now provide a specific explanation of why the treating physician's rationale is insufficient. This goes beyond the existing requirement to cite guidelines and clinical reasoning, it requires direct engagement with the treating physician's stated position.

Identification of Liable URAC-Accredited Entity. Adverse UR decisions must now identify the URAC-accredited entity that is liable for the decision. This is a transparency measure and should be incorporated into denial/modification templates.

Updated IMR Appeal Rights Language. The template language in denial and modification letters regarding IMR appeal rights must be updated to conform with § 9792.9.5(e). The DWC has indicated that organizations should work directly with DWC UR staff to accomplish this through the UR plan modification process.

Denials After Extension of Time (Substantive Medical Necessity Finding). Where a denial is based on a substantive medical necessity finding after an extension of time was taken, the denial must now include: a description of the information that was needed, the dates and times the request was made, the manner of the request, and the date the missing information was first received.

Denials Based on Untimely Receipt of Information ("CNC" Denials). For denials issued because requested information, testing, or consultation results were not timely received, the letter must include: the reason for the decision, a specific description of the needed information, the date and time of attempts to contact the physician, and the manner of those attempts. The DWC notes that these requirements are already embedded in Labor Code § 4610(i)(5) and are being restated in the regulations to clarify their application in this context.

IV. IMR Application Updates

The DWC has updated the IMR application form with the following changes:

New Checkboxes. Three checkboxes have been added at the top of the form to categorize the type of dispute: (1) Medication Only – MTUS Formulary Drug List; (2) Retrospective for Exempt Treatment (Non-Drug); and (3) Retrospective for Exempt Treatment (Drug).

Mailing Date Field. A new field has been added under "Disputed Medical Treatment" for the mailing date of the UR determination letter.

Filing Deadline Designation. Claims administrators and UROs must now mark which IMR filing deadline applies. If the dispute involves only a drug listed on the MTUS Formulary Drug List, the deadline is 10 days from the mailing date of the UR determination letter. For all other disputes — including drugs not on the MTUS Formulary Drug List — the deadline is 30 days from the mailing date.

Known Form Errors. The DWC has acknowledged two omissions from the updated IMR application: the Authorized Designated Representative (ARD) form was inadvertently left out, and the "city" field was omitted from various address sections. Both are being corrected. In the interim, organizations should continue including the ARD form with adverse UR decision letters and note city information in the general address fields.

V. Action Items to Consider

The following steps should be evaluated before April 1, 2026:

1. Template Updates. Review and revise all UR approval, denial, and modification letter templates to incorporate the new content requirements, including generic substitution language, formulary exemption designations, 30-day exemption labels, and the identification of the liable URAC-accredited entity.

2. UR Plan Filings. Determine whether a UR plan modification is required and prepare the new UR-01 cover form. Coordinate with DWC UR staff regarding updated IMR appeal rights language.

3. Client List Compliance. UROs should confirm their client lists are current and establish a process for ongoing maintenance under § 9792.7(c).

4. IMR Application Workflow. Update internal processes to account for the revised IMR application, including the new checkboxes, mailing date field, and filing deadline designation. Continue including the ARD form despite its omission from the updated application.

5. Staff Training. Ensure UR physicians and reviewers understand the new requirement to substantively respond to a treating physician's express opinion that guideline prerequisites should be disregarded.

This summary is provided for informational purposes and highlights key operational changes under the DWC's updated UR regulations. It is not a comprehensive restatement of all new requirements. Organizations are strongly encouraged to review the full regulatory text and consult with legal counsel to ensure compliance.

CALIFORNIA 2026 NEWS

Beginning January 1, 2026, the following laws take effect for all injuries occurring on or after 1/1/26 unless otherwise noted:

·       SB 230 expands rebuttable presumptions for firefighters by extending coverage for cancer, PTSD, and other injuries to firefighters working at commercial airports. It also broadens presumptions for conditions such as pneumonia to firefighters serving at commercial airports, NASA installations, and U.S. Department of Defense facilities, further strengthening presumptive coverage for high-risk public safety work environments.

·       AB 1125 extends the heart injury presumption to peace officers employed by the State Department of State Hospitals, affording them the same presumptive benefits previously limited to officers at Atascadero State Hospital. The change recognizes the comparable occupational risks faced by these workers.

Beginning February 1, 2026, employers are required to provide a stand-alone written notice to current employees and new employees upon hire, in a manner the employer normally uses to communicate job or employment information, with information related to employee rights, including:

• Workers’ compensation benefits (including disability pay and medical care for work-related injuries or illness, and the contact information for the Division of Workers’ Compensation)
• Notice of inspection by immigration agencies. Labor Code 90.2
• Protection against unfair immigration-related practices against a person exercising protected rights. Labor Code 1019-1019.2.
• The right to organize a union or engage in a concerted activity in the workplace, and Constitutional protections when interacting with law enforcement at the workplace (i.e., fourth amendment protection against unreasonable searches and seizure, and fifth amendment protection against self-incrimination and right to due process)
• Rights when interacting with law enforcement at the work place, including immigration.  US Const 4^th and 5^th Amendment.