California Court Rules Workers’ Comp Law Provides Exclusive Remedy in Utilization Review Case

The California Supreme Court issued an opinion in late August that utilization review physicians cannot be sued for malpractice, upholding established law that the workers’ comp system provides injured employees an exclusive remedy against an employer for work-related injuries.

The court considered the application of workers’ comp exclusivity to claims arising from the utilization review process. Utilization reviewers act on behalf of employers and determine if a treatment plan recommended for an employee injury is medically necessary.

If the reviewer concludes a treatment is not necessary, the treatment request may be denied.

In 2008, Kirk King sustained a back injury while at work, and reportedly suffered chronic pain as a result, which in turn caused anxiety and depression. In 2011, a mental health professional prescribed psychotropic drugs, including Klonopin, to King.

Dr. Naresh Sharma, an anesthesiologist employed by defendant CompPartners Inc., a utilization review management company, conducted a review in 2013 of the Klonopin prescription and determined the drug was medically unnecessary and decertified the prescription.

Sharma’s decertification did not provide for a weaning regimen, nor did Sharma warn King of the risks of abruptly ceasing Klonopin and King suffered a series of seizures as a result.

In 2014, King and his wife filed a complaint in court against CompPartners and Sharma among others, asserting claims including negligence, professional negligence, and intentional and negligent infliction of emotional distress.

The defendants demurred, arguing that the Kings’ claims were preempted by the Workers’ Compensation Act, and that the negligence claims failed because Sharma owed no duty of care to King.

The trial court agreed with both arguments and sustained the demurrer without leave to amend. The Court of Appeal affirmed the order sustaining the demurrer but reversed the denial of leave to amend. The Court of Appeal also held that Sharma owed King a duty of care.

The California Supreme Court in the August opinion affirmed the Court of Appeal’s judgment insofar as it affirmed the trial court’s sustaining of the demurrer, but it reversed its judgment insofar as it permitted the Kings to amend their complaint to bolster their claim that defendants are liable in tort for failure to warn.

The case has been remanded to the Court of Appeal for further proceedings consistent with this opinion.