by | Jun 26, 2015 | Workers' Comp Industry

The DWC’s new fee schedule regulations for copy services take effect on July 1, 2015.

While the billing process for copy services has at long last been made as simple as possible with the introduction of a flat fee system, new regulations mean new openings for potential exploitation, misinterpretation, and abuse.

Perhaps now more than ever, claims administrators should take care to closely review each applicant photocopy invoice to ensure that it meets all of the new requirements set forth in the new regulations.

The new regulations and the flat fee system makes copy bills easier to understand and pay than ever. But does that mean that these bills should be paid without question and without important supporting documentation?

Below are 10 things you need to know about the new copy service fee schedule regulations — things to look out for and suggestions of what you might consider demanding from the copy services before issuing payment.

And remember: Now that copy services are bound by a fee schedule, copy service providers should follow the guidelines set forth in Labor Code section 4622(b) and California Code of Regulations sections 9792.5.5(c)(4) and 9792.5.5(d) for requesting a second review and submitting the documentation you have requested.

1. What is covered by the new copy service fee schedule regulations?

The fee schedule covers “copy and related services” for records relevant to an injured worker’s claim only. This is nothing new, but you are now specifically given room to question the relevancy of the records you’re being asked to pay for.

Suggestion: When you feel that the relevance of the records is questionable and wonder why the copy service would have requested them, start by demanding a copy of the requesting attorney’s order form in order to make the copy service prove that they were in fact instructed to request those specific records.

2. What rates and fees are allowed by the new regulations?

A new flat rate pricing system is introduced, with only a few “add-on items” allowed.

A flat fee of $180 covers everything that has to do with requesting, obtaining, and copying one set of records, regardless of format or media, up to 500 pages. Payment is limited to “copy and related services.”

  • If it’s not directly related to copying records, you don’t pay for it. No vague items can be added to the bill; the flat fee covers everything.
  • The fee schedule goes even further and specifically disallows payment for certain non-copy-related items: Summaries, tabulations, and indexing of documents.
  • All witness fees and “release of information” fees are included in the $180 flat fee. The cost of obtaining records will no longer be passed to the claims administrator. It now becomes the responsibility of the copy services to dispute any release of information fees that they feel are excessive.

The first “add-on” item is a fee of 10 cents per page beyond 500 pages.

Another “add-on” item is a flat fee for additional sets of records.

  •  $5 for each additional set if ordered within 30 days of the subpoena or authorization request.
  • $30 for each set if ordered more than 30 days after the subpoena or authorization request.
  • These flat rates are designed to cover the cost of additional sets of records provided in electronic form. You will not be stuck paying additional per-page fees.
  • The injured worker is entitled to one additional set of records at $5 or $30, a cost which the claims administrator is liable for.
  • Any other additional sets must be paid for by the party that ordered them.

X-rays are payable at $3 per CD of films, and $10.26 per physical sheet of films.

  • Suggestion: The vast majority of imaging centers provide films on CD. If you are being charged for physical sheets of films, demand proof that the films were not provided on CD or that they were not available on CD, which would be the less costly and burdensome medium of delivery.

3. Are there any circumstances where the flat rate amount changes?

The flat rate goes down to $75 when a “Certificate of No Records” is obtained. Some copy services may see this as an opportunity for easy money.

  • Suggestion: The fee schedule does not say that a fee of $75 is owed “if no records are obtained.” It says, specifically, “for a certificate of no records.” Always demand a copy of the Certificate of No Records (CNR) signed by the custodian of records before paying the $75.
  • Consider demanding a copy of the requesting attorney’s order form in order to establish that the copy service was in fact instructed to request records from that location.

The flat rate goes down to $75 if the order is canceled by the ordering party after the subpoena or authorization has been issued, but before any records are obtained. Some copy services may see this as another opportunity for easy money. You might suddenly be seeing a lot of invoices for canceled orders!

  • Suggestion: Demand a copy of the requesting attorney’s order form as proof that the records were actually ordered; proof that the subpoena or authorization was actually served; and proof that the order was canceled, in writing, after the request was served.

The flat rate goes down to $20 for records from the EDD and $30 for records from the WCIRB.

  • Suggestion: The new regulations also provide you with the means to object to these bills in their entirety every time. Anytime the records could have been obtained via less costly means, no payment is allowed for these records. The fee schedule goes ahead and defines these less costly means for you:
    • Free WCIRB internet search
    • Injured worker can request EDD records for free
    • EDD is only authorized to provide records if they have an existing lien in the WCAB case, which you can easily verify

4. What exactly does a “set of records” consist of?

A “set of records” means records in any format from one custodian of records, produced under one subpoena or authorization request.

  • One of the biggest areas of applicant copy service billing abuse is the issuing of multiple subpoenas to a single custodian of records when one subpoena would have sufficed for all record types under that custodian’s control. Multiple subpoenas = multiple invoices.
  • This abuse will continue, but we now have regulations to cite when objecting to these duplicative bills.

Suggestions/Examples:

  • Personnel, payroll, and employee handbook all subpoenaed separately? Demand copies of the declarations of custodian of records. If you see that all three were signed by the same custodian, you’ll know that only one subpoena request was necessary.
  • Kaiser Foundation Hospital and SCPMG clinic records subpoenaed separately? Only one subpoena is necessary to request both.
  • Medical records and X-rays subpoenaed separately? There’s a good chance that the facility electronically stores everything in the same system, all under the control of one custodian of records.

5. What about duplicate requests for records that were already obtained?

You won’t normally have to pay for records previously obtained from the same location by the same party, but there is an exception that could be exploited.

The loophole is that you are liable for payment of duplicate records if the subpoena or authorization is accompanied by a declaration from the party requesting the records setting forth “good cause” to seek duplicate records.

The regulations actually give two examples of “good cause:” New counsel seeking duplicate records, and natural disasters.

  • Suggestion: Verify that the requesting attorney is the one who wrote and signed the declaration of good cause, as opposed to the copy service coming up with what they think might be good cause.
  • Verify that the declaration of good cause was served with the subpoena. There should be a proof of service showing that both documents were served together.

6. What requirements or regulations must the copy service comply with in order to be eligible for payment?

The copy service must be registered with their county clerk as a Professional Photocopier pursuant to Business & Professions Code sections 22450-22463. These registration requirements are not new, but have never been specifically enforced until now.

Professional Photocopiers must meet a series of requirements to ensure that they are qualified to handle and reproduce sensitive medical records and personal information. Anyone unable to meet these requirements should not be handling records or participating in the discovery process!

The Professional Photocopier registration number and county of registration must be listed on every invoice.

  • Suggestions:
    • Verify with the county clerk that the copy service’s registration status is current and active. Professional Photocopier registration does expire, and must be renewed every two years. The registration requirements must be met again upon each renewal.
    • Verify that the county of registration listed on the invoice matches the county in which copy service’s maintains its principal place of business.
    • Is the registration number for a company or an individual? If only an individual is registered, confirm that that individual actually did the work by demanding a copy of the declaration of custodian of records signed by that individual professional photocopier.

Be on the lookout for unqualified and unregistered copy services looking for loopholes in the registration requirements. This is currently one of the biggest problems in the copy service industry, and certain companies may now ramp up their efforts to find a way around becoming a registered professional photocopy service. The good news is that none of these efforts so far have ever been successful.

7. What information needs to be on the copy service’s invoice?

There is now a laundry list of specific information that must be present on every bill. We suggest verifying that all information is present before issuing payment:

  • Taxpayer ID
  • Professional Photocopier Registration # and the county in which the copy service is registered
  • Invoice date AND date of service must be indicated separately
  • Claimant name, claim number, WCAB case number
  • Location of records
    • Suggestion: Make sure that the the actual facility is listed, not just the Release of Information service that copied the records and mailed them to the copy service (e.g. “Records obtained from: Middleman ROI Specialists, Inc.” doesn’t cut it!)
  • Type of records must be specified
    • This will help you spot unnecessarily duplicative requests issued to the same location
  • Description of services
    • At minimum, this should specify whether a subpoena or authorization was used
    • An invoice simply stating “Flat Fee $180.00” doesn’t cut it!
  • Number of pages of records obtained
  • A statement that there was no violation of Labor Code section 139.32
  • The copy services now have the option to include new billing codes on their invoices. Verify that billing codes have been used properly.

8. What if the copy service uses an authorization instead of a subpoena to request records?

If the copy service uses an authorization instead of a subpoena, they are not required to submit any type of declaration to certify that they actually copied the records they claim to have copied. Some copy services may interpret this to mean that they don’t have to prove anything when an authorization is used.

The DWC’s final statement of reasons for implementation of the fee schedule regulations states, “As authorizations are not used to obtain documents by non-contracted copy services, this [requirement] is not necessary.”

This unfortunately perpetuates the myth that defense-oriented copy services all have exclusive contracts with claims administrators. This statement also falsely implies that applicant copy services never use authorizations to obtain records. In fact, we have been privy to many situations where an applicant’s attorney had the injured worker sign a blank authorization, which the copy service then got a hold of and filled in whatever information they wanted.

  • Suggestion: Compare an original copy of the authorization with the version used to request records.
  • Demand a copy of the requesting attorney’s order form to make sure the request matches what’s on the authorization.

9. Will claims administrators and employers have to pay for records already in their possession that were subpoenaed too quickly by the copy service?

Enforcing labor code section 5307.9, the regulations specify that there will be no payment for records in the possession of the employer, claims administrator, or insurer provided within 30 days of a written request for those records by the applicant or applicant’s attorney.

Will the copy services suddenly stop their practice of quickly subpoenaing the claims file, the personnel file, wage statements, etc. whether or not the requesting attorney asked them to do so? That remains to be seen.

  • Suggestion: Demand a copy of the subpoena and a copy of the attorney’s written demand for records, and verify that the copy service waited at least 30 days before serving that subpoena.
  • The copy service should also provide a declaration from the requesting attorney stating that the demanded records were not received within 30 days.

10. Does the fee schedule apply to copy bills issued prior to July 1, 2015?

The fee schedule will not be retroactively applied. It will apply only to services provided on or after 7/1/15.

Expect business as usual from the applicant copy services as they pursue collections and liens on their pre-fee schedule invoices. Unfortunately, that fight is not over by a long shot — but AAA Copy & Review Services is here to help you with that!

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