KING v. COMPPARTNERS

Respondents’ Petition for Review

Cal.February 16, 2016

_ $232197 IN THE SUPREME COURT OF CALIFORNIA SUPREME COURT FILED KIRK KING,et al. FEB T6 2016 Plaintiffs, Appellants and Respondents Frank A. McGuire Clerk Deputy VS. COMPPARTNERS,INC., etal. Defendants, Respondents and Petitioners. AFTERADECISION BY THE COURT OF APPEAL, FOURTH APPELLATE DISTRICT DIVISION TWO CASE NO.E063527 PETITION FOR REVIEW MURCHISON & CUMMING,LLP William D. Naeve (SBN 92270) Terry L. Kesinger (SBN 158576) David A. Winkle (SBN 123441) 18201 Von Karman Avenue,Suite 1100 ~ Irvine, California 92612-1077 Telephone: (714) 972-9977 Facsimile: (714) 972-1404 Attorneysfor COMPPARTNERS, INC. and NARESH SHARMA, M.D. TABLE OF CONTENTS Page ISSUES PRESENTED........ cee cecccsceseesseceneeeseeteeseeceseesensesseeeeneeecseeeses 1 INTRODUCTION 00... ccceeeeseeeesceeeeneeesceceeeceeeesseeeeeeeasenssesseecesseeens2 A. Whyreview should be granted ..............ccessssesssesseesseeeesseeseeees2 B. Background 0... eeeceeesseesseeeesceesserssseeeceeesseceesseeesesssseeesssees 5 (1) The Predicate Facts of Plaintiffs' Complaint................ 5 (2) CompPartners' General Demourret........0...cccceeeeeeeeees6 (3) The Trial Court's Decision to Sustain CompPartners' General Demurrer Without Leave to AMONG...eeeeeceeesccceeeseeeeessnereseesssesseeesereeceess 6 (4) The Court of Appeal's Published Opinion....................7 (5) Statement re: Rehearing (Cal. Rules Ct. rule 011(0)6)8 REVIEW IS NECESSARY TO SETTLE AN IMPORTANT QUESTION OF LAW HAVING WIDESPREAD INTEREST CONCERNING APPLICATION OF THE EXCLUSIVE REMEDY PROVISIONS OF THE WORKERS’ COMPENSATION ACT TO DECISIONS BY UTILIZATION REVIEW ORGANIZATIONG.........ccccceeeeeeeeeeeeeees 9 THE KINGS’ CIVIL ACTION IS PREEMPTED BY THE EXCLUSIVE REMEDY PROVISIONS OF THE WORKERS’ COMPENSATIONACTou...eecceceesseteeseeeseesseensaeens 10 A. An overviewofthe utilization review process under the Workers’ Compensation Act. ........:::ssseeeseetsestetestereeeeee LO COMPPARTNERSDID NOT OWETHE KINGS A DUTY OF CARE THAT COULD GIVERISE TO A CIVIL CAUSE OF ACTION ooo ccccccccecceeeceeseeeessesesaceesecesaeeecaeeeeeaeeneessecseesssensnesens 17 A. Introduction and context of the duty issue...17 B. CompPartners and Dr. Sharma owed nodutyofcare to the Kings oo... eeecceeecesececeeeesseeesseaseeseecesseeesscsseeessesessssecess 18 C. There are no other groundsfor duty ...........ccececseeeesesecceeeeee23 (1) The Kings were not owed a generalized duty of CALC... eeeeseeceesseeccececcceceseeeceeseeseesesessseeseteeseecetaescesnes23 (2) Established factors for assessing duty do not Apply in this CaS...eeeee eeeeeeeeeeeceeeseeeeteesteeesneeeeees24 (a) It was not foreseeable that Mr. King would forego his WCA remedies..............00004.24 (b) Injury from an erroneousdecisionis uncertain because Mr. King did not seek WCA FeVIOW oeceecccceceececeeseeessceessesseeesaecceeseneas25 (c) There is an inadequate connection between the conduct alleged and the TDJULY«2... ee eeeceeceeeeeseeecesseeeeecnseeesesseessessetesneeesses25 (d) There is no moral blamefor decertifying 1G(0Sv0)0)1se 25 (e) WCA penalties reduce the threat ofharm from erroneous CECISIONS............:cccsseesseseeeeeees26 (f) Imposing a duty would create an undue burden on WCA UROG........cccccccccssssserssceeeteees26 (g) Allowing a civil suit would adversely affect the availability of insurance..................27 THE TRIAL COURT’S ORDER OF DISMISSAL SHOULD BE AFFIRMED BASED ON WCA PREEMPTION AND THE ABSENCE OF DUTYou...eceeceeneeeeseeeeneeeeteesnsseenseesseesseeeees27 “CONCLUSIONooocece csececescesecseeeeaeeeeeseeeseeesseeenecseseeesseseseesenaes29 li TABLE OF AUTHORITIES Page CASES Beaty v. Workers’ Comp. Appeals Bd. (1978) 80 Cal.App.3d 397 oo eieecseseeseeeeeecsseeseeeesesseeneectseessreseeas 15 Charles J. Vacanti, M.D. Inc. v. State Comp. Ins. Fund (2001) 24 Cal.4th 800... cccccccsecscceeeceeeeecteceteeseeetsesteessaresseens 14, 16 Keene vs. Wiggins (1977) 69 Cal.App.3d. 308 oo.ec cececsseeeseeeeseeeteeeeteaseesneessseeenas 7, 20 Lawrence v. Bank ofAmerica (1985) 163 Cal.App.3d 431 oo... eee eeecceesseeeseeeeeteeeeseeesceenseeeees 10, 31 McCoolv. Monterey Bay Medicar (2014) 2014 Cal. Wrk. Comp. P.D. LEXIS 578 .o...ccccccccssscecsceseeeseeeesseeeeeeseeeeeecceesseecntecatssseessesesnaes 25 Palmer vs. Superior Court (2002) 103 Cal.App.4th 953 ocesecccessneceeesseeeeeeseeseneennees 8, 22, 23 Simmonsv. State ofCalifornia (2005) 70 Cal. Comp. Cases 866......... 0... cccceec cece eee eeaeenee enue22 Snyder v. Michael’s Stores, Inc. (1997) 16 Cal.4th 991] ooo. cecceseceneesaeeesseeeseecsecesersasseaeseeeesseseeaees 15 State Comp. Ins. Fund v. Ind. Acc. Com. (1960) 176 Cal.App.2d 10 oo... eeccesseeeeceseerereeeeseecesteesssesnsessnseeess 15 State Compensation Ins. Fund vs. Workers' Comp. Appeals Bd. (2008) 44 Cal.4th 230 oo... cscccseeceneeseeteeseessnesereeeesaeenaes 6, 11 12, 13 Tarasoffv. Regents of University ofCalifornia (1976) 17 Cal.3d 425 ooo ccecececsesccescceecceneeeesanecseeeeseecsacesseessnseeees 27 Tenet/Centinela Hospital Medical Center v. Workers' Comp. Appeals Bd. (000) 80 CalApp.4th 104]oeeececeeseeeeeneeeeetentesteens 11, 13 14 STATUTES 8 CCR 9792.6. 1(t)(2) .ceecceseccseceecssneecceeseeseeeneesaeessceseeeeesenteseeseseeeesteseagess 26 8 CCR 9792.O(C)(A) veececccessecceneecseneececeseeeeccneseeeeeseeeseesseerteeenseeeaeeeeseatens 26 8 CCR 9792.9.1(6)(S)(CK). cc ceeccceccectneesseeseneeeeseceeseneerseaeersaeeeaaeeeneeeeeeesateesenes 26 ill California Labor Code section 3600, SUD. (8.) ....cececeseeeteceeeteeteenees 6 California Labor Code section 4610.5 ...ccicccccesseseseectseteesseeseetesseeseeeses 6 COR 9792.9. 1(C)(4) vccccccccccscecssneceneeeeeeccceeevercneeesenetieeesasiesensessessessessssaesenears 26 Code ofCivil Procedure Section 425.13. cccccecessescetscsseeseeseetssssseseseees 22 Labor Code section 4062(Db) .......ccccccccccsscccsnteeeeceeseeseeecssnneteceeesentsnneeeesereesaas 12 Labor Code section 4610 ........ceescccsscseeerrceenteessessesssseseeecacseesseeeeeesseaeespassim Labor Code Section 4610(a) .....cccccsccssscsccsseceeesseceeeneecseeeeessnaeeesoreneeseney 11, 25 Labor Code section 4610(D)........cccccceccecessseeneceeeeesseeseseeseeseeseseseneuseseereeeenes 1,5 Labor Code section 4610(C) .......cscccssscccsseecsneeeeesssreeesesseeeeeeessaeessseseaeeees 5, 30 Labor Code section 4610.5 .....cccccccsccessccssececeersaeeeseneeseaceeesssneesesseeeesaneseaaesegs 12 Labor Code sections 4062 ......ccccccesscscecsesstecececescaeeaaneneeseeeceeseuaaasseeseesees 11, 13 Simmons v. State ofCalifornia (2005) 70 Cal. Comp. Cases 866......... 24, 25 RULES California Rules ofCourt Rule 8.500(D)(1) .....cescecsessesresesesneeeeeseeensensens 10 California Rules ofCourt rule 8.504(D)(4) occccceeeecestesssererseeresessseeeeseaees 8 iv TO THE HONORABLECHIEF JUSTICE AND THE HONORABLEASSOCIATE JUSTICES OF THE CALIFORNIA SUPREME COURT: COME NOW,defendants and respondents COMPPARTNERS, INC., and NARESH SHARMA,M_D.(hereinafter referred to collectively, and in the singular, as “CompPartners”), and respectfully submit this petition for review. 1. ISSUES PRESENTED 1. Is a civil claim by an injured worker who challenges a decision made by a Workers’ Compensation Utilization Review Organization which performed Utilization Review of recommendations madebythe injured worker’s treating physicianpreempted by the exclusive remedyprovisions of the Labor Code? 2. Does a Workers’ Compensation Utilization Review Organization which conducts a Utilization Review of recommendations madebythe injured worker’s treating physician pursuant to Labor Code section 4610(b) owe a commonlaw duty of care to the injured worker? 3. Did the Court of Appeal err whenit reversed thetrial court's refusal to grant plaintiffs leave to amend because plaintiffs' claims were preempted as a matter of California law and because defendants owed no commonlaw duty ofcare to plaintiffs? 2. INTRODUCTION A. Whyreview should be granted Hard cases makebadlaw. What makesthis case hard is its embryonic state — 1.e., a published opinion based on an ordersustaining a demurrerto an initial complaint without leave to amend. This forced the Court of Appeal to issue a literally unprecedented decision undermining the exclusive remedies of the Labor Code concerning Utilization Review decisions made underthe auspices of the Workers’ Compensation Act (“WCA”) based on assumedor hypothetical facts, as the opinion itself acknowledges. Yet based on these assumedor hypothetical facts, the opinion effects a sea-change in the WCA by undermining the mechanism carefully crafted by the Legislature for resolving disputes that arise over utilization review decisions.’ What makesthis law badisthatit blurs the roles and duties of treating physicians responsible for day-to-day care of injured workers with the roles and duties ofphysicians providing utilization review on behalf of a qualified WCA Utilization Review Organization (“URO”) such as CompPartners. ' For this reason, CompPartners has filed a separate letter requesting this Court order the Court of Appeal’s opinion depublished. CompPartners submits the Court of Appeal’s opinion holdingthat in some cases, a WCA URO might oweduties to the injured workers similar to those owedbythe treating physician is new to California law. The irony of this opinion is that the Court of Appeal had no trouble discerning that some WCA UROdisputes are preempted by the Labor Code, and thus affirmedthetrial court order sustaining the demurrer based on preemption. Respectfully, the opinion goes wrong in two broad respects:(1) it erroneously holds preemption might not apply in somecases, based on purely hypothetical facts; and (2) it erroneously holds that a duty might be owed in somecases under those same hypothetical facts. True, the opinion seeks to ameliorate its holding by acknowledging this new duty imposed on a WCA UROvaries with the relationship of the parties and requires a case-by-case approach. (Opinion, p. 17.) Butthis does not cure the harm inflicted on the WCA.To the contrary, the Court of Appeal's opinion instructs workers and their attorneys just exactly how to avoid the inconvenient ramifications of California's exclusive remedy provisions with nothing morethana rote allegation that the WCA URO should have issued a warning directly to the worker about the consequences of its decision. This pronouncement wholly underminesthecarefully- crafted legislative framework defining how WCA URO decisionsare to be made and how disappointed workers can invoke a specific statutory 3 administrative procedure to challenge and reverse those decisions. As this Petition will demonstrate, the validity of the intricate statutory mandates which regulate WCA UROs,in general, and how these organizations are to make, announce andallow review oftheir decisions,in particular, is now in doubt because of the Court of Appeal's less than rigorous analysis of these statutes. If the Court of Appeal's opinion, based as it is on nothing more than speculative facts, is allowed to survive, Superior Courts throughout California will face a multiplicity ofcivil actions which the legislature clearly intended to be within the jurisdiction of the WCA. Further, the opinion is not supported by the case law on whichit relies and is contrary to the Legislature’s plan for utilization review under both the Labor Code and the California Code ofRegulations. The sweeping preemption ofcivil litigation by the exclusive remedies of the WCA indelibly brands this as a question of great importance on anissue affecting every California employer and employee subject to the WCA. Accordingly, CompPartners requests that this Court grant review for the purpose ofresolving the important questions presented and holding (a) that the claim alleged by the Kingsis preempted, (b) thata WCA URO does not owea duty of careto aninjured worker, and (c) thattheCourtof Appealerred in reversing the trial court’s ruling sustaining the demurrer without leave to amend. B. Background (1) The Predicate Facts of Plaintiffs’ Complaint Atissue in the Court of Appeal's opinion is a Utilization Review decision made by two UROphysiciansaffiliated with defendant and respondent CompPartners in the context of a pending Workers’ Compensation claim filed by plaintiff and appellant employee, Kirk King. CompPartners wasretained by State Compensation Insurance for Utilization Review on behalf of Kirk King's employer as a URO underthe statutory authority of California Labor Code section 4610(b). During the Utilization Review process, the URO physicians are alleged to have decertified a medication being administered to Kirk King concluding it was not medically necessary. (Labor Codesection 4610(b).) (AA 0003:23-0004:14.) It is important to note that a URO physician does not enjoy the far reaching discretion afforded to treating physicians. While treating physicians may have the entire pharmacopeiaat their disposal, Labor Code section 4610(c) restricts URO physiciansto specific and closely circumscribed schedules for medical treatment. In any case, Kirk Kingalleged in his complaint that the decertification of this medication caused him to experience fourseizures. (AA0004:6-7.) Seeking damagesasa result of the seizures, Kirk King filed the civil action, whichis the subject of the Court of Appeal’s opinion. (AA 0001- 0009.) The complaint does not allege, nor do plaintiffs contend, that Kirk King ever disputed the decertification via the statutorily created dispute resolution mechanismsset forth in California Labor Code section 4610.5 which providesall Utilization Review disputes, "shall be resolved only in accordancewith this section." (See, e.g., State Compensation Ins. Fundvs. Workers' Comp. Appeals Bd. (2008) 44 Cal.4th 230, 279-280.) (2) CompPartners' General Demurrer CompPartners filed a general demurrer in responseto plaintiffs’ original complaint (AA 0019-0043) arguing that the causes of action essayed in the Kings’ complaint were wholly and inescapably preempted by the exclusivity provision of California's Workers’ Compensation statutes. (California Labor Code section 3600, subd. (a.) (AA 0020:5-6; Id. 0028:15-0032:20.) As an adjunctto its principal preemption argument, CompPartners argued that even ifpreemption did not knock outplaintiffs’ claims, plaintiffs' claims could not state any causes of action since a Utilization Review physician acting on behalf of a URO for an employer owedno duty ofcare to plaintiffs as a matter of California law. (See,e.g., Keene vs. Wiggins (1977) 69 Cal.App.3d. 308, 313.) (AA 0032:23- 0034:24.) (3) The Trial Court's Decision to Sustain CompPartners' General Demurrer Without Leave to Amend Thetrial court sustained CompPartners' general demurrer without leave to amend. (AA 0072-0073.) The trial court’s decision concluded that the plaintiffs' claim was preempted and that the URO physicians who made the decertification recommendation did not oweplaintiff Kirk King a duty of care. Despite these rulings, the trial judge observed, “This needs to go to the court of appeals. There is really no good law, any law underutilization." (AA 0111:23-24.) After the demurrer was sustained without leave to amend, an Order of Dismissal was entered. (AA 0083-0084.) (4) The Court of Appeal's Published Opinion’ The Court of Appeal's published opinion affirmedthetrial court's decision to sustain CompPartners' general demurrerto plaintiffs’ original complaint, but reversedthe trial court's refusal to grant plaintiffs leave to file a first amended complaint. In its opinion, the Court of Appealinitially opined that while the URO physicians’ decision to decertify Kirk King's medication could be subject to preemption, plaintiffs' complaint was unclear. The Court of Appeal indicated that ifplaintiffs claimed their damages were causedas a result of the decision to decertify Kirk King's medication by the Utilization Review physicians, then their action was preempted. Onthe other hand, preemption would notapplyifplaintiffs were really claiming that their damages were causedasa result the URO physicians' failure to “communicat[e] a warning to Kirk, their claims are * Pursuant to California Rules ofCourt rule 8.504(b)(4), a copy of the Court of Appeal’s opinion is attached hereto as Exhibit “A” notpreempted ... because that warning would be beyond the 'medical necessity’ determination made by [Dr.] Sharma." (Opinion, p.13.) The Court of Appeal didn't stop at preemption. Citing Palmer vs. Superior Court (2002) 103 Cal.App.4th 953, the Court of appeal announced a blanketrule that, “/c/ase law provides a Utilization Review doctor has a doctor-patient relationship with the person whose records are being reviewed[.] (Opinion, p. 17.) Thereafter, and without acknowledgingthat the facts of this case are inextricably governed by the labyrinth of statutory law which makes up California's Workers’ Compensationstatutes, the court held that under the opinion in Palmer, “there is a doctor-patient relationship between Kirk and [Dr.] Sharma. Becausethere is a doctor-patient relationship, Sharma oweda duty of care." (Opinion, p.17.) The trouble with this analysis is that the plaintiff in Palmer was challenging a Utilization Review decision made by,or on behalfof, his HMO.Hewasnot an injured worker seeking review of a decision by a Workers’ Compensation URO. There would have been no occasion to consider preemption. The court concludedits duty analysis by indicating there was a question concerning the scope of that duty. (Opinion, p. 18.) (5) Statement re: Rehearing (Cal. Rules Ct. rule 8.504(b)(3) Nopetition for rehearing wasfiled. LEGAL DISCUSSION 1. REVIEW IS NECESSARY TO SETTLE AN IMPORTANT QUESTION OF LAW HAVING WIDESPREAD INTEREST CONCERNING APPLICATION OF THE EXCLUSIVE REMEDY PROVISIONS OF THE WORKERS’ COMPENSATION ACT TO DECISIONS BY UTILIZATION REVIEW ORGANIZATIONS. This dispute raises questions offirst impression concerning WCA Utilization Review whosevital importanceis underscored bythe fact that the resolution reached by the Court of Appeal underminesan elaborate hierarchy of review crafted by the legislature and codified in the Labor Code. As such, grounds for review exist under California Rules ofCourt Rule 8.500(b)(1) As noted above, the Court ofAppeal reversed the dismissal issued by the trial court. That dismissal came aboutafter the trial court sustained CompPartners’ demurrer without leave to amend on the groundsthat the Kings’ claim was preempted and that CompPartners did not owe the Kings any duty of care. Review is respectfully requested to reverse the Court of Appeal’s opinion on issues of preemption and duty so that there is no basis for granting leave to amendand the dismissal should be affirmed insofar as the defects in the complaint were matters of law that could not be cured by amendment. (Lawrence v. Bank ofAmerica (1985) 163 Cal.App.3d 43 I 436.) 2. THE KINGS’ CIVIL ACTION IS PREEMPTEDBY THE EXCLUSIVE REMEDY PROVISIONS OF THE WORKERS’ COMPENSATION ACT A. An overview of the utilization review process under the Workers’ Compensation Act. The Legislature has established a detailed mechanism for resolving disputes regarding the appropriate level of care that should be rendered to an injured employee. The mainspring of this mechanism can be found in Labor Code section 4610 which requires every employer to establish utilization review processes “that prospectively, retrospectively, or concurrently review and approve, modify, delay, or deny, based in whole or in part on medical necessity to cure or relieve treatment recommendations by the physician.” (Labor Code section 4610(aj;See also, State Comp. Ins. Fund v. Workers' Comp. Appeals Bd., supra, 44 Cal.4th at p. 236.) The Legislature has also crafted an equally detailed mechanism for resolving an injured employee’s disputes over the treatment request. (Labor Code sections 4062, 4610.5; Tenet/Centinela Hospital Medical Centerv. Workers' Comp. Appeals Bd., (2000) 80 Cal.App.4th 1041, 1048.) Initially, Labor Code section 4062(b) provides a meansfor an employee to object to a utilization review decision, including a request for authorization of a particular treatment. In such cases, ”the objection shall be resolved only in accordance with the independent medical review process established in section 4610.5.” (Labor Code section 4062(b) [emphasis -10- added].) Here, of course, the complaint essentially objects to the utilization review decision to “decertify” Klonopin, meaningthat plaintiffs’ sole resort is to Labor Code section 4610.5. This section applies to “[a]ny dispute over a utilization review decision if the decision is communicatedto the requesting physician on or after July 1, 2013, regardless of the date of injury” and that such disputes “shall be resolved only in accordance with this section.” (Labor Codesection 4610.5 [emphasis added].) Suchis the case here. Although Mr. KING’son-the-job injury alleged occurred in 2008, and Klonopin wasfirst prescribed in 2011, Klonopin wasnot “decertified” by way ofutilization review until “July of 2013” as confirmed by a second utilization review “[i]n October of 2013.” (AA 0003:23- 0004:14.) In this regard, State Comp. Ins. Fund v. Workers' Comp. Appeals Bd., supra, 44 Cal.4th 230 is particularly instructive. There, an employee suffered a work-related accident. Two physicians sent the employer’s insurer a request to authorize an MRI. In response, the employer referred the matter to utilization review. The doctor that performed the review denied the request based on new medical treatment guidelines. (State Comp.Ins. Fund v. Workers' Comp. Appeals Bd., supra, 44 Cal.4th at p. 234.) In explaining the dispute process contemplated by Labor Code sections 4062 and 4610, court explained: -ll- (1) the Legislature intended for employers to use the utilization review process in section 4610 to review and resolve any andall requests for treatment, and (2) if dissatisfied with an employer's decision, an employee (and only an employee) may use section 4062's provisions to resolve the dispute over the treatment request. (State Comp. Ins. Fund v. Workers' Comp. Appeals Bd., supra, 44 Cal.4th at p. 237.) This ruling is reinforced in Tenet/Centinela Hospital Medical Center v. Workers' Comp. Appeals Bd., supra, 80 Cal.App.4th 1041 which holds, in relevantpart: Whenthere are disputes about the appropriate medical treatment . . . or the need for continuing medical care, Labor Code section 4061 or 4062 applies. (Citation.) Sections 4061 and 4062 of the Labor Code establish the procedures for resolving such disagreements. (Tenet/Centinela Hospital Medical Center v. Workers' Comp. Appeals Bd., supra, 80 Cal.App.4th at p. 1048 [emphasis added].) In summary, there can be no doubtthat if Mr. King wished to challenge the utilization review decision by his employer(allegedly facilitated by CompPartners) he was required do so by wayofthe appropriate sections of the WCA that establish the procedures for resolving such disagreements. (Tenet/Centinela Hospital Medical Center v. Workers' Comp. Appeals Bd., supra, 80 Cal.App.4th at p. 1048.) Not only does the WCApreclude a civil suit against his employer, it also precludesa civil suit oS against those involved in utilization review because“the exclusivity -]2- provisions encompassall inquiries ‘ collateral to or derivative of an injury compensable by the exclusive remedies of the WCA.” (Charles J. Vacanti, M.D. Inc. v. State Comp. Ins. Fund, (2001) 24 Cal.4th 800, 813.) By way of example, if a workplace accident contributes to a later injury outside the workplace, that latter injury is still deemed to be a “compensable consequence”of the original workplace injury even if the injured claimant wasnot workingat the time of the subsequent accident. (Beaty v. Workers’ Comp. Appeals Bd. (1978) 80 Cal.App.3d 397, 402.) in Beaty, the court reasonedthat the work-related injury “need not be the exclusive cause of the Subsequent Accident but only a contributing factor to it. So long as the Industrial Injury was a contributing factor to the Subsequent Accident, liability is established on an industrial basis.” (Ud. at p. 402,citing State Comp. Ins. Fund v. Ind. Acc. Com. (1960) 176 Cal.App.2d 10 [worker suffered an eye injury and while suffering the effects of the eye injury, lost a finger while using an electric saw].) Indeed, the Court of Appeal’s opinion here acknowledgesthat preemption applies to disputes that are “deemed collateral to or derivative of the employee’s injury.” (Opinion,p. 10, citing Snyder v. Michael’s Stores, Inc. (1997) 16 Cal.4th 991, 997.) The opinion also acknowledges that Vacanti holds that the WCA exclusive remedyapplies to “injuries arising out of and in the course of the workers’ compensation claims process .. . because this process is tethered to a compensable injury.’” _]3- (Opinion, p. 11, citing Charles J. Vacanti, M.D., Inc. v. State Comp. Ins. Fund, supra, 24 Cal.4th at p. 815.) Moreover, the opinion “interprets” Vacanti “to mean that if something goes wrongin the claimsprocessfor the workplace injury,” then exclusivity applies. (Opinion,p. 12, citing Charles J. Vacanti, M.D. v. State Comp. Ins. Fund, supra, 24 Cal.4th at pp. 813- 814.) That is exactly what has been alleged here, under any interpretation of the complaint. Even if the Kings’ complaint is construedas alleging the injury was causedbyfailure to warn ofthe effects of sudden Klonopin withdrawal, that failure to warn cannotlogically be separated from the claims process becausethe failure to warn arose during the claims process. Mr. King alleges he suffered a work related injury, that he submitted a WCAclaim,and that the claim was being handledbyreferral to a treating physician who had prescribed Klonopin.In the course of the claim, the recommendation for Klonopin was submitted to WCA UROatwhich time Klonopin was decertified. Thealleged failure to warn at issue herein is still an inherent incident of the claims process and as such Mr. King had an immediate and detailed review process under the Labor Code at his disposal. Thus, contrary to the opinion, the civil claim is preempted under Vacanti. But the opinion goes on to read the complaintto allege two “options” for finding CompPartners harmed Mr. King — one subject to -14- preemption and another which now hasa green light to proceedin civil court. Thus, this case has becomea real-world manifestation of the threat of double tracked claims involving WCA UROdecisionsraised by the Kings’ complaint. Briefly, as the opinion describes it, one option (which is preempted) is that CompPartners incorrectly decertified Klonopin without a weaning regimen. The second option (which in the Court of Appeal’s view is not preempted) is that CompPartners simply failed to warn the Kings of the effect of quitting Klonopin cold turkey after it was decertified. The opinion drawsthe distinction on the grounds that warning about a sudden withdrawal was notpart of the “medical necessity” analysis.” (Opinion, p. 12-13.) This is a distinction without a difference. In the first place, if a weaning regimen is important enough to require a warning that sudden withdrawal could causeseizures, then the decision that any number (or no number) of extra doses is required becomes an inseparable component of medial necessity. Thus, both scenarios require — and can be resolved by — application of the WCAreview provisions.It should be noted that the Kings’ failure to state whether the MTUSvests the WCA UROwith any discretion to order a weaning regimen deprives the Court of Appeal of any firm factual basis for its conclusion that a “failure to warm”decision is now preempted. This only serves to underscore the harm inherent in creating a new duty on speculative and incomplete facts. -15- Second, the Court of Appeal acknowledged that if CompPartners had simply failed to authorize a certain numberof doses until weaning was complete, the weaning decision would havebeenpart of the medical necessity determination. But that is exactly what the complaint alleges, at least by inference, and what the Court of Appeal assumes:that CompPartners’ utilization review decision concluded, based on the appropriate guidelines, that weaning was not a matter of medical necessity. Third, the utilization review provisions of the WCAaretailor made for either dispute. Once the utilization review decision was complete, it was the employer’s duty to report that to Mr. King’s treating physician so as to facilitate, if necessary, peer-to-peer discussion with the WCA URO pursuant to 8 CCR 9792.9.1E(5)(K). Assuming that CompPartners continued to maintain that the appropriate MTUSdid not provide for a Klonopin regimen (or a Klonopin weaning regimen), the WCA provided an opportunity for review of that decision. Thus, suppose that CompPartners did know cold turkey Klonopin withdrawal was dangerous, and simply failed to warn ofthat trap. If that were the case, then surely Mr. King’s treating physician would have been under a duty to make such a contemporaneous warning to Mr. Kingat the time of the decertification, not monthslater after seizures had allegedly occurred as a result of the decertification. Then Mr. King’s physician had every opportunity to challenge the URO decision under the Labor Code. -16- As a result, whether the Court of Appeal parsesthis out as a failure to warn or failure to certify, either outcomeis inseparable from a determination of medical necessity, meaning that by the court’s own reasoning, the claim should be preempted.’ 3. COMPPARTNERSDID NOT OWE THE KINGS A DUTY OF CARE THAT COULD GIVE RISE TO A CIVIL CAUSE OF ACTION A. Introduction and context of the duty issue By wayof introduction, the principal argument on demurrerwasthat WCApreemption barred the Kings’ civil lawsuit. Indeed,the trial court’s tentative ruling only addressed the issue of preemption. (AA 0071.) Lack of duty was raised in the demurrer and addressed bythetrial court as an alternative basis for dismissing the Kings’ claims. (AA 0027:18-19; 0032:24-0034:24; Id., 0101:28-0102:1) So far as it pertains to this petition, it will suffice to note that the Court of Appeal’s opinion concludes that a WCA UROowessomeduty ofcare to the injured claimant, although the extend of that duty will depend onthe facts ofthe case. This holding was wrongfor the following reasons. * Of course, the Complaint does not revealif Mr. King ever complained to his treating physician,if the treating physician sought a “peer-to-peer” review,orif the detailed appellate procedures set out in the Labor Code were followed. Bo ng a d t Es SL og ee wy ls at -17- B. CompPartners and Dr. Sharma owedno duty of care to the Kings The opinion acknowledges that a claim for medical malpractice requires a patient-physician relationship. (Opinion,p. 14, citing Keenev. Wiggins, supra, 69 Cal.App.3d 308.) However, the opinion does not address the Keene analysis on analogousfacts. In Keene, an injured employee’s disability status was reviewed by the defendant, a doctor retained by the employer’s workers’ compensation carrier. Unhappy with the outcomeofthe report, plaintiff sued the doctor for medical malpractice. Unlike the present case, the injured employee wasactually seen by the doctor. (/d. at pp. 310-311.) Nevertheless, the court still held the absence of a physician/patient relationship warranted dismissal of a medical malpractice claim by the injured employee against the examining doctor. This was because “the physician is liable for malpractice or negligence only wherethereis a relationship of a physician-patientas a result of contract, express or implied, that the doctor will treat the patient.” Ud. at p. 313 [emphasis added].) The court explained: [I]t is apparent where a doctor conducts an examination of an injured employeesolely for the purposeof rating the injury for the employer's insurance carrier in a workers’ compensation proceeding, neither offers or intends to treat, care for or otherwise benefit the person examined, and has no reason to believe the person examined will rely on this report, the doctoris not liable to the person being examined for negligence in makingthat report. -18- (Keene v. Wiggins, supra, 69 Cal.App.3d at p. 313-314.) Thus, the court held the absence of a physician-patient relationship wasfatal to the plaintiff's medical malpractice claim. (/d. at p. 315.) The Kings’ complaint does not allege the WCA URO doctors ever examined Mr. King face to face (AA 0004:1-2 [Dr. Sharma]; Jd., 0006:1-2 [Dr. Ali]) and there are no facts establishing a relationship of physician- patient as a result of contract, express or implied, that the URO doctors would treat Mr. King. Thus, CompPartners and Dr. Sharma owed no duty to the Kings. The Court of Appeal’s opinion did not address these factors. Instead of applying Keene, the opinion leapfrogs Keene’s language regarding an express or implied relationship to treat the patient Ud. at p. 313) to reach Palmer v. Superior Court, supra 103 Cal.App.4th at p. 953 and to hold utilization review gives rise to a doctor-patient relationship so that a duty of care arises under Keene. (Opinion,p. 17.) There are several errors in this analysis. First, the opinion applies Palmer too broadly. As the opinion notes, what Palmer was addressing was the question of whether leave of court to allege punitive damages pursuant to Code ofCivil Procedure section 425.13 was required where the claim arose from a dispute overutilization review outside of the WCA.Thus, the narrow question for the court was not whether a doctor-patient relationship existed between the patient and -19- the utilization review physician. Rather, the question for the court was whetherthat utilization review physician’s services amountto professional negligence. In turn, this required the court to apply the test for defining professional negligence: “whether a health care provider’s negligence constitutes professional negligence is whether the negligence occurred in rendering services for which the health care provideris licensed.’” (Opinion,p. 10.) While there is no question that a physician providing a medical opinion in WCA URO matters is rendering some degree of professional services, the Court of Appeal’s reliance on Palmer begs the question of duty — that is, to whom is the duty owed? Keene answersthat question by holding that a doctor-patient relationship only arises where there is a “contract, express or implied, that the doctor will treat the patient.” (Keene v. Wiggins, supra, 69 Cal.App.3d at p. 313.). Certainly the services provided in Keene (conducting an examination ofa patient to rate the injury) were professional in nature. What was missing in Keene(asin this case) was an agreementto treat the patient. The issue of duty in the present case is controlled by Keene, not by Palmer. Second, the Court of Appeal’s opinion also begs the question of preemption, because its analysis ofPalmer correctly notes the decision did not arise in the context of the WCA.Rather, the decision was made by a hospital’s utilization review department (Opinion,p. 15, citing Palmerv, -20- Superior Court, supra, 103 Cal.App.4th 958-959) so Palmer had no occasion to address preemption. Pa/mer thus has no application to the question of whether breach of any duty owed to the claimant by a WCA URO(assumingsolely for the sake of argument, that such a duty existed)is nevertheless preempted by the exclusive remedy provisions of the WCA. Third, the Court of Appeal’s analysis rests on the notion that a WCA UROhas the same medical discretion enjoyed by treating physicians in recommending treatment. That is not the case. As noted in CompPartners’ brief on the appeal (andasreiterated in this petition) the benchmark for acceptable treatment in the WCA context is provided by specific schedules for medical treatmentutilization. (section 4610(c.) This robs the WCA UROofits ability to consider and implement what might be acceptable practice in the locality. Instead, the specific guidelines must be consulted. (See respondent’s brief, p. 25.) The details of this limitation on the WCA URO’s decisions were fully explained in the recent Request for Decertification filed on behalf of the California Workers’ Compensation’s Institute. By way of summary,the legislature has adopted an objective Medical TreatmentUtilization Schedule (“MTUS”) drawn from evidence-based, peer reviewed and nationally recognized standards of medical treatment. The MTUSthus provides a WCA UROwith the yardstick to measure whether recommendations by the treating physician are medically necessary. -2]- Thus, WCAcase law and pertinent regulations distinguish the role (and the duties) of a treating physician from the role (and the duties) of a WCA URO. In Simmonsv. State ofCalifornia (2005) 70 Cal. Comp. Cases 866 (Appeals Board en banc opinion) the court emphasized the limited role of a WCA UROphysician. In language reminiscent ofKeene, the decision observesthat “a utilization review physician does notphysically examine the applicant, does not obtain a full history ofthe injury or a full medical history, and might not review allpertinent medical records”(Id. at p. 874 [emphasis added].) Rather, according to Labor Code section 4610(a) “utilization review is directed solely at determining the ‘medical necessity’ of treatment recommendations.” (Simmons v. State ofCalifornia, supra 70 Cal. Comp. Cases 866at p. 873.). Additionally, McCool v. Monterey Bay Medicar (2014) 2014 Cal. Wrk. Comp. P.D. LEXIS 578is instructive even if not binding. In that case, a WCA UROdecertified pain medications without a weaning regimen. However, the matter was resolvedentirely within the dispute resolution schematic provided by the Legislature in the WCAandthe decision indicated that “future decisions which violate section 4610(c) may bereferred to the Administrative Director to review defendant's written policies and procedures and potentially assess penalties for abuse of the UR process.” McCool v Monterey Bay Medicar, supra, 2014 Cal. Wrk. Comp. P.D. LEXIS 578 at p. [*13]. _22- Sunilarly, regulatory authorities confirm that the role of the treating physician is to submit a “request for authorization” with supporting documentation. (8 CCR 9792.6.1(t)(2).) The role of the employeris to subject that request to “utilization review” (which can of course be lawfully delegated toa WCA UROsuch as CompPartners) to test the request against the applicable guideline (8 CCR 9792.9.1(c)(3)) and then report that conclusion to the treating physician. (8 CCR 9792.9(c)(4)) inviting a “peer- to-peer” discussion. (8 CCR 9792.9.1(e)(5)(K).) Of course this would have been a golden opportunity for Kirk King’s treating physician to raise questions about a weaning regimen. And if the WCA UROstill concluded cold turkey decertification was required under the guidelines, CCR 9792.9.1(c)(4) provided for expedited review. In this case, the complaint does notallege that any of this occurred. Indeed the opinion acknowledgesthat “the Kings’ complaint includes few factual details” and that (again assuming a duty exists) discharge of[this] duty will depend “on the facts/circumstancesofthis particular case.” (Opinion, p. 18.) A declaration of potential duty based on speculation as to what the facts might be is premature and inappropriate. C. Thereare no other groundsfor duty (1) The Kings were not oweda generalized duty of care Citing Tarasoffv. Regents of University ofCalifornia (1976) 17 Cal.3d 425, the opinion discusses a generalized duty to warn, concluding -23- that such a duty andits discharge will depend on the facts and circumstances of each case. (Opinion,p. 18.) But this only serves to bring the discussion back to square one. While an employer may owe employees a generalized duty, a claim for breach of that duty is a claim under the WCA.Anycontrary outcome would undermine the WCA. (2) Established factors for assessing duty do not apply in this case The opinion makesbrief reference to the traditional elements of duty, such as the parties’ relationship, the foreseeability of harm and reliance. (Opinion, p. 17 citing Keene v. Wiggins, supra, 69 Cal.App.3d at p. 313.) However, the opinion does not address these factors in depth and, in fact, a more detailed analysis of the factors establishes that no duty should be found here. (a) It was not foreseeable that Mr. King would forego his WCA remedies The availability of a detailed WCA appeal mechanism clouds foreseeability to the point of obscurity. CompPartners and Dr. Sharma had no reason to foresee that Mr. King would not pursue an appeal under section 4610.5, or anticipate what the outcome might have been if Mr. King did pursue an appeal. The element of foresceability is absent andcannot support a duty. -24- (b) Injury from an erroneous decisionis uncertain because Mr. King did not seek WCAreview The availability of a WCA appealofthe utilization review decision also dissipates the certainty of any injury from conduct by CompPartners or Dr. Sharma.It can hardly be certain that an erroneousutilization review decision will cause injury where the claimant elected not to bring a speedy appeal as washis right (and exclusive remedy) under the WCA. (c) There is an inadequate connection between the conduct alleged and the injury Simply put, the Kings’ failure to avail themselves of their appeal rights under the WCAsevers any alleged connection between the consequences of the Kings’ decision and CompPartners or Dr. Sharma’s performanceoftheir utilization review duties. (d) There is no moralblamefor decertifying Klonopin CompPartners and Dr. Sharmadid exactly what they were obligated to do under the WCA. Assuming arguendo that a weaning regimen was desirable, an expedited review undersection 4610(g)(2) could have speedily reinstated Klonopin. Mr. King’s unexplained and unforeseeable . election toforego-his. WCAappeals erases anyblame on CompPartners and Dr. Sharma. /// /// -25- (e) WCApenalties reducethe threat of harm from erroneous decisions WCA UROsdo not enjoy immunity; instead, significant penalties can be imposedfor utilization review failures. By way of example, Labor Code section 4610.1 targets “an unreasonable delay in completion of the utilization review processset forth in section 4610.” (Labor Codesection 4610.1.) In turn, section 5814 provides for penalties of up to $10,000 if “payment of compensation has been unreasonably delayed or refused.” Civil liability is not necessary to protect claimants; indeed subsection (f) of Section 5814 cautions that “[n]othing in this section shall be construed to create a civil cause of action.” Moreover, rogue WCA UROdecisions are presently deterred by section 4610(4) which provides that the administrative director may assess administrative penalties ultimately benefiting the public through deposit in the Workers’ Compensation Administrative Revolving Fund. Any UROcausingsuch penalties will certainly not be retained by employers in the future. Enforcing the WCA exclusive remedy provisions is the best way to minimize the threat of future harm without undermining the certainty ofWCA by imposing unforeseen civilliability. (f) Imposing a duty would create an undue : ~ burden onWCA UROs | ee A generalized standard ofcare is not the benchmarkforutilization review; rather, the benchmark is provided by specific schedules for medical treatment utilization. (Labor Code section 4610(c).) This means the WCA -26- UROcannot merely rely on what might be acceptable practice in the locality; instead, the specific guidelines must be consulted. Imposing the additional benchmark ofthe local standard of care would increase the burden on WCA UROsparticularly where the standards conflict. (g) Allowinga civil suit would adversely affect the availability of insurance A claim that a WCA UROcanvery easily obtain malpractice insurance fails to consider the increased cost and decreasedavailability of that insuranceifthe duty imposed by the opinion stands. Because a WCA UROis not a claimants’ personal physician, its exposure would be reduced and premiums would have been reducedin proportion. Broadeningthat exposure by opening a newclass ofcivil liability not previously contemplated by the WCA will affect both the cost and availability of insurance, which militates against the duty imposed by the Court of Appeal. Accordingly, there is no basis on which to imposea duty on the WCAUROprovidersas to Mr. King. 4. THE TRIAL COURT’S ORDER OF DISMISSAL SHOULD BE AFFIRMED BASED ON WCA PREEMPTION AND THE ABSENCE OF DUTY It is not an abuse of discretion to sustain a demurrer without leave to amend, even on the initial round of the pleadings, where the defect is one of law that cannot be cured by amendment. -27- Leave to amend should be denied where the facts are not in dispute andthe nature ofthe claim is clear but no liability exists under substantive law. (Lawrence v. Bank ofAmerica, supra 163 Cal.App.3dat p. 436.) Suchis the case here. Holding that the Kings’ civil action was preempted by the WCAandinsofar as the element of duty could not be established, the trial court sustained CompPartners’ demurrer without leave to amend. Asset forth in this petition, CompPartners submits that this Court should grant review for the purposeofinstructing that the Court of Appeal reached the wrong result on the issues of duty and preemption. That being the case, no amount of amendment would allow the Kings to plead around the admission in their complaint that their claim arose in the course of utilization review by a WCA UROand assuchis subjectto the exclusive remedy provisions of the WCA, preempting their civil lawsuit against CompPartners as a matter of law. /// /// /// | /// /// /// -28- 5. CONCLUSION Based on the foregoing, CompPartners Inc., and Naresh Sharma, M.D., respectfully request this Court grantthis petition for review. DATED:February 12, 2016 David A. Winkle Attorneys for CompPartnersInc. and Naresh Sharma, M.D. -29. CERTIFICATE OF WORD COUNT (California Rules ofCourt, Rule 8.504 id) The text ofthis petition consists of 6357 words as}counted by the Dated: February 12, 2016 By: Terry L. Kesinger David A. Winkle -30- EXHIBIT “A” CERTIFIED FOR PUBLICATION IN THE COURT OF APPEAL OF THESTATE OF CALIFORNIA FOURTH APPELLATE DISTRICT DIVISION TWO I iL, 1&3 JAN 05 2015 | COURT OF APPEAL FOURTH DISTRICT KIRK KINGetal., Plaintiffs and Appellants, E063527 Vv. (Super.Ct.No. RIC1409797) COMPPARTNERS,INC.et al., OPINION Defendants and Respondents. APPEAL from the Superior Court ofRiverside County. Sharon J. Waters, Judge. Affirmedin part; reversedin part. Law Offices ofPatricia A. Law, Patricia A. Law and Jonathan A. Falcioni for Plaintiffs and Appellants. Murchison & Cumming, William D. Naeve, Ellen M. Tipping and Terry L. Kesinger for Defendants and Respondent. KirkKing (Kirk)! sued CompPartners, Inc. (CompPartners) and Naresh Sharma, M.D.(Sharma), for (1) professional negligence; (2) negligence; (3) intentional infliction of emotional distress; and (4) negligent infliction of emotionaldistress. Kirk’s wife, Sara King (Sara), sued CompPartners and Sharma(collectively, “defendants”’) for loss of consortium. Kirk and Sara (collectively, “the Kings”) sought general, special, exemplary, and punitive damages.” Thetrial court sustained defendants’ demurrer without leave to amend. The Kingsraise three issues on appeal. First, the Kings contend their claims are not preempted by the Workers’ Compensation Act (WCA). Second, the Kings assert defendants owed them a duty of care. Third, the Kings contendthe trial court erred by denying them leave to amend. Weaffirm the sustaining of the demurrer but reverse the denial of leave to amend. FACTUAL AND PROCEDURAL HISTORY A. COMPLAINT The facts in this section are taken from the allegations in the Kings’ complaint. On February 15, 2008, Kirk sustained a back injury while at work. In July 2011, Kirk suffered anxiety and depression due to chronic back pain resulting from the back injury. In 2011, Kirk was prescribed a psychotropic medication known as Klonopin. 1 Weusefirst names for the sake ofclarity. No disrespect is intended. 2 The Kings also sued MohammedAshrafAli, M.D. (Ali); Whittier Drugs; and Does1 through 100. The forgoing three defendants are not respondents in this appeal. Atthe time of the hearing on the demurrer, Ali had not been served with the complaint. The Klonopin was provided to Kirk through Workers’ Compensation. In July 2013, a Workers’ Compensation utilization review was conducted to determineifthe Klonopin was medically necessary.> (Labor Code, § 4610, subd. (a).)# Sharma, an anesthesiologist, conducted theutilization review. Sharma determined the drug was unnecessary and decertified it. As a result, Kirk was required to immediately cease taking the Klonopin. Typically, a person withdraws from Klonopin gradually by slowly reducing the dosage. Dueto the sudden cessation ofKionopin, Kirk suffered four seizures, resulting in additional physical injuries. In September 2013, someone requested Kirk again be permitted to take Klonopin. In October 2013, Ali, a psychiatrist, conducted a secondutilization review. Ali also determined Klonopin was medically unnecessary. Neither Sharmanor Ali examined Kirk in-person, and neither warned Kirk of the dangers ofan abrupt withdrawal from Klonopin. Sharma and Ali were employees of CompPartners. CompPartners was a Workers’ Compensation utilization review company. B. DEMURRER Defendants demurred to the complaint. Defendants asserted the Kings’ claims were preempted by the WCAbecausethey aroseoutofa utilization review. Defendants interpreted the complaint as objecting to the decision to decertify Klonopin. Defendants 3 “Utilization review” is the process by which employers “review and approve, modify, delay, or deny” employees’ medical treatment requests within the Workers’ Compensation system. (Labor Code, § 4610, subd. (a); State Compensation Ins. Fund v. Workers’ Comp Appeals Bd. (2008) 44 Cal.4th 230, 234, fn. 3 (State Fund).) 4 All subsequentstatutory references will be to the Labor Code unless indicated. asserted the utilization review wasperformed at the behest of Kirk’s employer and was conducted in connection with the payment of benefits for Kirk’s workplace back injury. Defendants contended the Labor Codeset forth a procedure for objecting to a utilization review decision, and that procedure preempted the Kings’ complaint. Alternatively, defendants asserted they did not owe Kirk a duty of care. Defendants argued there was no doctor-patient relationship because they never personally examined Kirk and did not treat him. Defendants reasoned that because there was no relationship, there was no duty of care. Defendants further asserted the Kings had improperly split a medical malpractice cause of action into two negligence causes of action. Defendants contended the emotional distress causes of action were subsumed by what should have beena single medical malpractice claim, and that Sara’s loss of consortium claim failed because there was no underlying tort cause of action to support it. C. OPPOSITION The Kings opposed the demurrer. First, the Kings asserted their claims were not preempted by the WCA. The Kingsasserted their claims concernedthe failure to provide Kirk with a Klonopin-weaning regimen; they were not disputing the decision to decertify the Klonopin. The Kings contendedthis claim fell within the ambit of a negligence cause of action—it did not fall within the proceduresset forth in the Labor Code/WCAfor disputing a utilization review decision. Second, the Kings asserted defendants owed Kirk a duty of care because Kirk’s medical treatment was effectively being determined by defendants’ decisionsat the utilization reviews. Third, the Kings asserted they did not improperly split a medical malpractice cause ofaction becausetheir cause of action for general negligence was brought in the alternative, in case the court determined the defendants were not healthcare providers for purposes of the professional negligence causeofaction. Fourth, the Kings asserted Kirk’s cause of action for intentional infliction of emotional distress set forth sufficient facts to support an independent cause of action; however, the Kings also referenced a proposed First Amended Complaint filed concurrently with the opposition that alleged additional facts to support the cause ofactionfor intentional infliction of emotional distress.5 Fifth, the Kings asserted there were sufficient facts alleged to support the loss of consortium causeofaction. D. HEARING Thetrial court issued a tentative opinion sustaining the demurrer due to the lawsuit being preempted by the WCA. Atthe hearing on the demurrer, the Kings explained they were not disputing the decision to decertify Klonopin; rather, they were focused on the mannerin which the decision was carried out—the decision to abruptly halt the medication rather than gradually reduce the dosage. The Kingsasserted there were two requirements that triggered Workers’ Compensation—{1) the employee was working at the timeofthe injury, and (2) the injury was proximately caused by the employee’s job. The Kings asserted Kirk’s seizures did not meet these two W Y E R tA or es 5 The Kingsdid notfile the Proposed First Amended Complaint. The proposed First Amended Complaintis not included with the Opposition in the Appellant’s Appendix. 6 requirements and, thus, fell outside the ambit of the WCA. Further, to the extent the WCAencompassesderivative or collateral claims, the seizures were “a wholly separate injury.” Thetrial court said, “So if I’m wrong on the exclusivity, you trip over another issue which is duty.” The Kings explained that a doctor-patient relationship was not neededfor a duty to be created. Rather, a duty is owed when a doctor’s decision affects the patient’s treatment. The Kings asserted Sharma’s decision affected Kirk’s treatment by effectively dictating the treatment. No other doctor was involved in the decision to terminate the Klonopin; the insurance company asked Sharmaifthe Klonopin was medically necessary, and based upon Sharma’s answer, the Klonopin was discontinued. The Kings asserted Sharma’s decision was negligent because no weaning schedule or warnings about seizures were given. Defendants asserted the Kings were “obviously” contesting the utilization review decision, and a challengeto the utilization review falls within the ambit of the WCA. Next, defendants asserted they owed no duty to Kirk because Kirk did not hire defendants and defendants did not meet Kirk when performing the utilization review. The Kings again explained that they were not contesting the utilization review decision. The Kings said they did not want Klonopin to be prescribed again; rather, they were complaining about Sharma’s decision to abruptly stop the Klonopin rather than gradually stop the Klonopin. Thetrial court said, “You may have convinced methat, you know, maybe Worker’s Comp exclusivity may or may not apply; because youare correct, he’s not : actually trying to challenge the decision directly.” However, thetrial court also said, “I don’t think there is a duty.” Thetrial court explained Sharmadid notprescribe the Klonopin;rather, “[h]e made a recommendation underthe utilization review thatit be withdrawn.” The court said, “Somebody else prescribed this medication. Somebody else took it off—took him off it immediately without any slow withdrawal. That’s the person who made the medical decision for your client, not the doctor who was simply reviewing the procedure.” The Kings asserted “it wasn’t anybody else’s decision other than Dr. Sharma’s to discontinue [the Klonopin]. [{[] It wasn’t merely a recommendation. It was Dr. Sharma—is this patient—essentially, the question was: Is this patient going to continue receiving this medication or not, put your stamp on it. He says, No. It ceases.” Thetrial court asked the Kings what facts they could add ifthey were granted leave to amend their complaint. The Kings said they would add facts about “the patient-client relationship, that CompPartners hired this doctor to make treatment decisions. Based off of a review of the patient’s chart, the doctor made treatment decisions.” CompPartners responded with two points. First, CompPartners said that if the Kings were suing due to a discreet injury then Kirk could “directly amendhis application for adjudication of claim in the Workers’ Compensation Appeals Board and seek retribution or damages for whatever treatment decisions were made during the process.” Second, CompPartners argued, “Just think aboutthe duty implicationsifthis Court ruled that someone who reviewed medical records and made a recommendation could be held liable for whatever ultimate decision. Because it’s not his decision to make. He’s making a review and making a recommendation. They don’t have to agree with [the] utilization review. The statute doesn’t require it. It just says they will review it and make recommendations, and then it’s out of his hands.” The Kings again explained that their claim involveda third party physician—notKirk’s employer—and therefore, the claim did not come within the WCA. Thetrial court said, ““My ruling stands. I’m sustaining the demurrer without leave to amend.” Thetrial court added, “[T]his needs to go up to the Court ofAppeals. There is really no good law, any much law underthe utilization.” Thetrial court explained that it sustained the demurrer due to both the exclusivity and duty issues. DISCUSSION A. OVERVIEW OF THE WORKERS’ COMPENSATION UTILIZATION REVIEW PROCESS “The workers’ compensation scheme makes the employer of an injured worker responsible for all medical treatment reasonably necessary to cure or relieve the worker from the effects of the injury. [Citation.] When a worker suffers an industrial injury, the worker reports the injury to his or her employer and then seeks medical care from his or her treating physician. After examining the worker, the treating physician recommends any medical treatment he or she believes is necessary and the employeris given a treatment request to approve or deny.” (State Fund, supra, 44 Cal.4th at pp. 237-238.) Disputes about treatment requests are resolved via the utilization review process, bat in which “employers can havetheir utilization review doctors review treatment requests.” (State Fund, supra, 44 Cal.4th at pp. 243-244.) After a utilization reviewis conducted, a treatment request may be approved, modified, delayed or denied. (§ 4610, subd. (a).) “[UJnder the statutory scheme, only an employer’s utilization review physician applying approvedcriteria can modify, delay, or deny treatment requests—an employer maynot, on its own, object to a treatment request. (§ 4610, subds. (e) & (f).)” (Smith v. Workers’ Comp Appeals Bd. (2009) 46 Cal.4th 272, 279 (Smith).) “Further, the utilization review scheme contains a procedure for resolving disputes over treatment requests that uses doctors, rather than judges,as the adjudicators. [Citations.] If an employee disagrees with theutilization review physician’s decision to modify, delay, or deny treatment, the employee can request review by an independent medical evaluator who,after evaluating the evidence, decides whether the sought treatment is necessary.” (Smith, supra, 46 Cal.4th at pp. 279-280; see also § 4610.6.) B. PREEMPTION 1. CONTENTION The Kings contendthetrial court erred in sustaining the demurrer becausetheir causes of action are not preempted by the WCA. 2. STANDARD OFREVIEW “We independently review the construction ofworkers’ compensation statutes.” (Smith, supra, 46 Cal.4th at p. 277.) Wealso apply the independentstandard ofreview to rulings on demurrers (McCall v. PacifiCare ofCalifornia, Inc. (2001) 25 Cal.4th 412, 415) and rulings on issues ofpreemption (Cellphone Termination Fee Cases (2011) 193 Cal.App.4th 298, 311). Thus, we apply the independentstandard of review. | 3. PREEMPTION The Workers’ Compensation exclusivity provision provides, in relevant part: “Liability for the compensation provided by this division, in lieu of any other liability whatsoever to any person . . . shall, without regard to negligence, exist against an employerfor any injury sustained by his or her employeesarising out of and in the course ofthe employment. . . in those cases where the following conditions of compensation concur: ... [J]... [{] (2) Where, at the time of the injury, the employee is performing service growing outofand incidental to his or her employmentandis acting within the course of his or her employment. [{] (3) Where the injury is proximately caused by the employment, either with or without negligence.” (Former § 3600, subd.(a) [eff. Jan. 2010].) In someportions of the Labor Code, the term “employer” includesa utilization review organization. (§ 4610.5, subd. (c)(4).) “Based on the [foregoing] statutory language, California courts have held workers’ compensation proceedings to be the exclusive remedyfor certain . . . claims deemed collateral to or derivative ofthe employee’s injury.” (Snyder v. Michael’s Stores, Inc. (1997) 16 Cal.4th 991, 997.) Derivative or collateral claims muststill meet the conditions of compensation set forth ante: (1) that the injury occur within the course of the employee’s job; and (2) the injury is proximately caused by the employee’s job. (Charles J. Vacanti, M.D., Inc. v. State Comp. Ins. Fund (2001) 24 Cal. 4th 800 813-814 (Vacanti).) If the collateral or derivative claim does not meet the 10 conditions of compensation, thenit is not subject to exclusivity. In other words,“a cause of action predicated on an injury where ‘the basic conditions of compensation’ are absent is not preempted. [Citation.] For example, courts have allowedtort claims in cases wherethe alleged injury—the aggravation of an existing workplace injury—did not occur in the course of an employmentrelationship.” (bid.) In the Kings’ complaint, they allege Kirk suffered a back injury at work in 2008. Then, in 2013, “Sharmafailed to provide any warnings concerning a gradual reduction of the dosage or continue Mr. King on the Klonopin until the step-down process of such medication was completed.” This failure on Sharma’s part caused Kirk to suffer seizures. The seizure injury did not occur in the course of Kirk’s job because there are no allegations Kirk was workingat the time ofthe seizures. The seizure injury was not proximately caused by Kirk’s job because the causeofthe seizures is alleged to be Sharma’s failure to provide appropriate information or a weaning regime—nothing about Kirk’s job is alleged to be the cause ofthe seizures. As a result, based upon the Kings’ complaint, the conditions of compensation have not been met. Wenote, however, the Vacanti opinion further provides, “Courts have also consistently held that injuries arising out of and in the course of the workers’ compensation claims processfall within the scope of the exclusive remedy provisions because this process is tethered to a compensable injury.” (Vacanti, supra, 24 Cal.4th at p. 815.) For example, where a person’s business is damaged due to “the failure to receive full and timely paymentontheir lien claims before the [Workers’ Compensation Appeals Board],” those “causes ofaction [are] collateral to or derivative of a 11 compensable workplace injury and fall{] within the scope of the exclusivity provisions.” ({bid.) Whenthis portion ofthe Vacanti opinion is read in context with the portion discussed ante, which requires the conditions of compensation to be met, we interpret Vacanti to mean that if something goes wrong in the claims process for the work place injury, such as collecting the money for the workplace injury, then that collateral claim must stay within the exclusive province of workers’ compensation. However, if a new injury arises or the prior workplace injury is aggravated, then the exclusivity provisions do not necessarily apply. (Vacanti, supra, 24 Cal.4th at pp. 813-814.) The Kings’ complaint presents an interesting issue on this point. The Kings complaint reads, “Dr. Sharmafailed to provide any warnings concerning a gradual reduction ofthe dosage or continue Mr. King on the Klonopin until the step-down process of such medication was completed. Due to the improper withdrawal of the medication, Mr. King sustained a series of four seizures resulting in additional physical injury. In September of 2013, there was a request to return Mr. King to the Klonopin due to the continuation of seizures. In October of 2013, another utilization review was performed by MohammedAshrafAli, M.D., a Psychiatrist. Once again, Mr. King was denied the use ofthe Klonopin. Dr. Ali failed to authorize the use of the Klonopin until a gradual reduction in dosage was achieved or warn ofthe abrupt withdrawal of the medication.” (Italics added.) The Kings have alleged two options for how Sharmaallegedly harmed Kirk. The first option is that Sharma harmedKirk by not informing Kirk of the possible 12 consequencesofabruptly ceasing Klonopin. This option involves a secondstep in the utilization review process: Sharma determines the drug is medically unnecessary and then must warn Kirk of the possible consequences of that decision. The second option is that Sharma harmed Kirk by incorrectly determining Klonopin was medically unnecessary, because the drug was medically necessary until Kirk was properly weaned from it. In this second option, the “medically necessary” decision wasalleged to have been incorrectly determined, and thus, part of the claims processis alleged to have gone wrong. The “medically necessary” question is directly part ofthe claims process. (§ 4610, subd. (c).) To the extent the Kingsare faulting Sharma for not communicating a warning to Kirk, their claims are not preempted by the WCA because that warning would be beyond the “medical necessity” determination made by Sharma. Tothe extent the Kings are faulting Sharmafor incorrectly deciding the medical necessity decision because Klonopin was medically necessary until Kirk was weaned,and thus a particular numberofpills, e.g., 10, 20, should have been authorized for weaning, the Kings’ claims are preempted by the WCA because the Kingsare directly challenging Sharma’s medical necessity determination. Dueto the uncertainty of the allegations in the complaint, the trial court properly sustained the demurrer. (Code, Civ. Proc., § 430.10, subd. (f) [pleading is uncertain].) However, becausethere is a possibility the causesofaction are notpreempted, the trial court erred by denying the Kings leave to amend. (See Nolte v. Cedars Sinai Medical Center (2015) 236 Cal.App.4th 1401, 1406 [““If it is reasonably possible the pleading 13 can be cured by amendment,thetrial court abuses its discretion by not granting leave to amend’”’].) C. DUTY The Kings contendthe trial court erred by concluding defendants did not owe Kirk a duty ofcare. “Tt long has been held that an essential element of a cause of action for medical malpractice is a physician-patient relationship giving rise to a duty of care.” (Merov. Sadoff(1995) 31 Cal.App.4th 1466, 1471.) “When the physician-patient relationship exists, either expressed or implied, the patient has a right to expect the physician will care for and treat him withproperprofessionalskills and will exercise reasonable and ordinary care and diligence toward the patient.” (Keene v. Wiggins (1977) 69 Cal.App.3d 308, 313 (Keene).) Case law providesa utilization review doctor has a doctor-patient relationship with the person whose medical records are being reviewed. In Palmer v. Superior Court (2002) 103 Cal.App.4th 953 (Palmer), the plaintiff sued his insurance carrier (the HMO)andhis primary healthcare provider (the hospital). The trial court struck the plaintiff's allegations claiming entitlement to punitive damages against the hospital under Civil Code ofProcedure section 425.13, which reflects punitive damages cannot be includedin a complaint for damagesarising out ofthe professional negligence of a healthcare provider. The plaintiffsought a writ of mandate setting asidethat order. (Palmer, at p. 957.) 14 Theplaintiff had lost both legs below his knees dueto a bacterial infection, and neededleg prostheses to walk. (Palmer, supra, 103 Cal.App.4th at p. 958.) In 2000, the plaintiffs prosthetist (Norton) concludedtheplaintiff's prostheses needed to be replaced. Norton sent letter to the plaintiff's primary care physician (Rivkin), a doctor at the hospital, recommendingthe use ofultra light prostheses. At Rivkin’s request, Norton prepared a cost estimate for the prostheses. A hospital employee from Rivkin’s office called Norton to inform him the prostheses request had been approved as medically necessary, and the request was being forwardedto the hospital’s utilization review department. Theplaintiff received a letter from the hospital reflecting the request had been denied becausethe hospital’s medical director determined the prostheses were not medically necessary. (/d. at pp. 958-959.) Rivkin informedthe plaintiffthat he was being pressured by the HMOto deny the new prostheses. However, Rivkin drafted a letter asserting the prostheses were medically necessary. The HMOsenttheplaintiff a letter reflecting it upheld the denial ofthe prostheses, and the plaintiff had the right to have the decision reviewed by the HMO’s appeals and grievance review committee. Theplaintiff initiated the review process, but a prompt decision was not issued. (Palmer, supra, 103 Cal.App.4th at pp. 959-960.) Theplaintiff filed a lawsuit against the HMO,the hospital and Rivkin, which included causes of action for intentional and negligentinfliction of emotional distress. | (Palmer, supra, 103 Cal.App.4th at p. 960.) Theplaintiff alleged the hospital provided a utilization review to the HMO, which determined whether requested medical services 15 were medically necessary. (/d. at p. 958.) The hospital soughtto strike the punitive damagesallegations because the cause of action arose out of the professional negligence of a healthcare provider. (Code Civ. Proc., § 425.13.) The trial court found the plaintiff's claims were “directly related to the mannerin which[the hospital] provided professional health care services, whether through Dr. Rivkin or [the hospital’s] utilization review.” (Palmer, at p. 961.) The appellate court explained, ““The test of whether a health care provider’s negligence constitutes professional negligence is whether the negligence occurred in rendering services for which the health care provideris licensed.’” (Palmer, supra, 103 Cal.App.4th at p. 962.) The appellate court examined whether the unfavorable utilization review services conducted by the hospital amounted to allegations of medical negligence. (/bid.) The plaintiff argued the utilization review did not amountto healthcare services, and thus, he could sue for punitive damages. Theplaintiff asserted the utilization review was purely administrative. (/d. at p. 968.) The appellate court concluded that the hospital’s medical director, who concluded the prostheses were not medically necessary, “was acting as a health care provider as to the medical aspects of that decision.” (/d. at p. 969.) The appellate court explained that the medical director’s utilization review decision amounted to medical care, and was not purely administrative, because the utilization review had to “be conducted by medical professionals, and they must carry out these functions byexercising medicaljudgment and applying clinical standards.” (/d. at p. 972.) The appellate court concludedthetrial court properly struck the punitive damages allegations because the damages arose out of 16 the professional negligence of a health care provider (Code Civ. Proc., § 425.13, subd. (a)). (Palmer, at p. 973.) Thus, under Palmer, there is a doctor-patient relationship between Kirk and Sharma. Because there is a doctor-patient relationship, Sharma owed Kirk a duty of care. As quoted ante, “When the physician-patient relationship exists, either expressed or implied, the patient has a right to expect the physician will care for and treat him with properprofessional skills and will exercise reasonable and ordinary care and diligence toward the patient.” (Keene, supra, 69 Cal.App.3dat p. 313.) However, the existence of a duty does not mean “a doctor is required to exercise the same degree of skill toward every person he sees. The duty he owesto each varies with the relationship of the parties, the foreseeability of injury or harm that may be expected to flow from his conduct and the reliance which the person may reasonably be expected to place on the opinion received. A case-by-case approachis required.” (Keene, supra, 69 Cal.App.3d at p. 313.) In other words, determining the scope ofthe duty owed depends upon thefacts ofthe case. In Tarasoffv. Regents ofUniversity ofCalifornia (1976) 17 Cal.3d 425, our Supreme Court examined whether a murderer’s therapist had a duty to warn the victim of the murderer’s intention to kill the victim, even though the victim wasnot the therapist’s patient. (/d. at pp. 430-431.) Our Supreme Court concluded, “[O]nce a “therapist does in fact determine, orunderapplicable professional standards reasonably should have determined, that a patient poses a serious danger of violence to others, he bears a duty to exercise reasonable care to protect the foreseeable victim of that danger. 17 While the discharge ofthis duty of due care will necessarily vary with the facts of each case, in each instance the adequacyofthe therapist’s conduct must be measured against the traditional negligence standard of the rendition of reasonable care under the circumstances.” (/d. at p. 439, fn. omitted.) Thus, while there is a duty owed by Sharmato Kirk, the scope or discharge of that duty will depend upon the facts/circumstances ofthis particular case. The Kings’ complaint includes few factual details. For example, it is unclear how Kirk came to learn that the Klonopin had been decertified—did he receive a letter, a phonecall, a denial at the pharmacy widow? The complaint reflects Sharma wasthe only doctor involved in the decision to decertify the Klonopin, until Ali reviewed that decision and affirmedit, but it is unclear what input, if any, the prescribing doctor may have had following Sharma’s decision. Given the lack of factual allegations related to duty, the scope of the duty owed cannot be determined from the complaint. Accordingly, we concludethe trial court properly sustained the demurrer. (Code Civ. Proc., § 430.10, subd. (e) [failure to plead sufficient facts].) Nevertheless, the trial court should have granted the Kings leave to amend because it is possible, given the allegation that Sharma was the only doctor involved in the decision, that, when more details are provided they could support a conclusion that, under the circumstances, the scope of Sharma’s duty included some form ofwarning have further facts to add to a potential First Amended Complaint. For example, they could offer an additional fact such as seizures being a known consequenceofabruptly 18 ceasing Klonopin, and Sharma knowingthat his decision to decertify the Klonopin would lead to the immediate denial of more Klonopin without any review by Kirk’s prescribing doctor. (See Nolte v. Cedars Sinai Medical Center, supra, 236 Cal.App.4th 1401, 1406 [““If it is reasonably possible the pleading can be cured by amendment, the trial court abusesits discretion by not granting leave to amend’”].) In sum,additional facts could cure the problems presented by the complaint and the Kings have additional facts to plead; therefore, the trial court erred by denying the Kings leave to amend. DISPOSITION The order sustaining the demurreris affirmed. The denial of leave to amend is reversed, and the case remanded for the Kings to file an amended complaint. The parties are to bear their own costs on appeal. CERTIFIED FOR PUBLICATION MILLER J. Weconcur: McKINSTER Acting P.J. KING J. 19 o o n oO o a n r t W O N Y = n y B N 2 = 2 8 2 8 B S B D l l m = - 0 6 A a n N f m O a F F W O N Y | = O C 22 PROOF OF SERVICE STATE OF CALIFORNIA, COUNTY OF ORANGE At the time of service, | was over 18 years of age and not a partyto this action. | am employed in the County of Orange, State of California. My business address is 18201 Von Karman Avenue, Suite 1100, Irvine, California 92612-1077. On February 12, 2016, | served true copies of the following document(s) described as PETITION FOR REVIEWontheinterested parties in this action as follows: SEE ATTACHEDLIST BY MAIL: |! enclosed said document(s) in an envelope or package provided by FedEx and addressedto the personsat the addresseslisted in the Service List. | placed the envelope or packagefor collection and overnight delivery at an office or a regularly utilized drop box of FedEx or delivered such document(s) to a courier or driver authorized by FedEx to receive documents. | declare under penalty of perjury underthe laws of the State of California that the foregoing is true and correct. Executed on February 12, 2016,at Irvine, California. (Nei Celle Jghnetta Caldwell o O N O o a n f F W O N Y = m e p n N O N O = 2 = 2 r i 2 S e S F U C e ] w o n o = O O 08 6 o O N OD O T O F& F W O N Y | C O O o NY O NH N D H WN W a o n o O T n f f SERVICELIST via U.S. MAIL Kirk King, Sara King vs. CompPartners, Inc., et al. JonathanA.Falcioni, Esq. Patricia A. Law, Esq. LAW OFFICES OF PATRICIA A. LAW, APC 10837 Laurel Street, Suite 101 Rancho Cucamonga, CA 91730 Telephone: (951) 683-8320 Facsimile: (951) 683-8321 Lena M. Louis, Esq. Michael Rohfeld, Esq. RESNICK & LOUIS, PC 9891 Irvine Center Drive, Suite 200 Irvine, CA 92618 Telephone: (714) 709-4400 Facsimile: (714) 709-4400 Superior Court of California Countyof Riverside 4050 Main Street Riverside, CA 92501 Counselfor Plaintiffs, KIRK KING and SARA KING Counsel for Defendant NICHOLE & ANDRE PHARMACEUTICALS,INC., erroneously sued as WHITTIER DRUGS Court of Appeal Fourth Appellate District 3389 Twelfth Street Riverside, CA 92501