On September 30, 2016, Governor Brown approved two bills designed to combat fraudulent lien filings by physicians and medical services providers, Assembly Bill 1244 and Senate Bill 1160.
As it relates to California Workers’ Compensation, AB 1244 concerns the situation in which a physician or medical services provider is convicted of a misdemeanor or felony involving fraud or abuse of the workers compensation system, but whose conviction does not include an agreed or Court imposed forfeiture of all outstanding lien claims. In that situation, “all liens pending in any worker’s compensation case in any district office within the state shall be consolidated and adjudicated in a special lien proceeding.” There shall be a presumption affecting the burden of proof in that proceeding that the lien arose as a product of the criminal enterprise. Unless the lien claimant succeeds in overcoming the presumption by a preponderance of the evidence, their liens are not payable.
A product of SB 1160 is the enactment of Labor Code Section 4615, which establishes that any lien filed by a physician or medical services provider be automatically stayed upon the filing of criminal charges against the physician or provider for an offense involving fraud against the workers’ compensation system, medical billing fraud, insurance fraud, or fraud against the Medicare or Medi-Cal programs. The stay remains in effect from the time the charges are filed until the disposition of the criminal proceedings. The names of any physician or provider of medical treatment services whose liens are stayed pursuant to Labor Code Section 4615 will be posted on the Department of Industrial Relations, Division of Workers Compensation website.
AB 1244 and SB 1160 are effective on January 1, 2017. Moving forward, a practitioner dealing with lien claims should make certain to check the DWC website to confirm that the lien provider has not been charged with or convicted of fraud before settling the lien.
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