Home > Uncategorized > New Lien Laws in Place – Swap Out the Checkbook for the Litigation Budget!

New Lien Laws in Place – Swap Out the Checkbook for the Litigation Budget!

There are few things that make the frozen, black heart of a defense attorney hum with warmth and mirth.  The sound of a “take nothing” as it is retrieved from an enveloped from the WCAB; the smell of arrest warrants for workers’ compensation fraudsters; and, of course the inexplicably sweet atmosphere and ambiance of liens being mercilessly crushed underfoot.

2017 is the dawn of a new era for many reasons – from Washington, D.C., to San Francisco, a lot of stuff is going to be very different in the coming years.  Among them, even if not the most significant, is the treatment of liens.

I respectfully direct the attention of my cherished readers to the 2017 version of Labor Code section 4903.05.

Liens filed on or after 1/1/17 will require additional documentation, or suffer the sweetest justice of all: “dismissal of the lien with prejudice by operation of law.”  (Labor Code section 4903.05(c)(3).  And, just to make things interesting, it’s not only the post 1/1/17 liens – “[l]ien claimants shall have until July 1, 2017, to file a declaration pursuant to paragraph (1) for any lien claims filed before January 1, 2017.”  (4903.05(c)(2)).

So, what is it that will have to be declared, under penalty of perjury, for all liens, past and future?  Aside from declaring that the lien is not subject to independent bill review and/or UR, AND one of the following:

(A) Is the employee’s treating physician providing care through a medical provider network.

(B)  Is the agreed medical evaluator or qualified medical evaluator.

(C)  Has provided treatment authorized by the employer or claims administrator under Section 4610.

(D)  Has made a diligent search and determined that the employer does not have a medical provider network in place.

(E)  Has documentation that medical treatment has been neglected or unreasonably refused to the employee as provided by Section 4600.

(F)  Can show that the expense was incurred for an emergency medical condition, as defined by subdivision (b) of Section 1317.1 of the Health and Safety Code.

(G)  Is a certified interpreter rendering services during a medical-legal examination, a copy service providing medical-legal services, or has an expense allowed as a lien under rules adopted by the administrative director.

How many times have we had to deal with lien claimants that KNOW they are not in the MPN because this is lien number 3,561 as between Defendant A and Lien Claimant 1

How many times do we have to deal with lien claimants that subjectively understand that they are not entitled to reimbursement but think that they can get SOMETHING just for filing a lien and inflicting litigation costs on a defendant?

Well, those litigation costs might be disappearing soon – if the lien does not have the required declaration, under penalty of perjury, then it SHALL be dismissed by operation of law, with prejudice.  If it does have such a declaration, and you’re pretty sure that the declarant has committed perjury, list the declarant as a witness for trial or depose him or her – perhaps sanctions and costs will be ordered after the lie is exposed.

Current proposed regulations for section 10770.7 will operate to dismiss all liens filed prior to January 1, 2017, by operation of law, if there is no supplemental declaration filed with the WCAB on or before July 1, 2017.

To help lien claimants comply with these new rules, the DWC has prepared a form, but is appears to be only available to JET and e-filers, so it is not linked on here.

So, be wary, dear readers, and hold up this additional hoop for lien claimants to jump through before getting out your checkbook instead.  As for me, I feel that cold, dark heart of mine warming up already.

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  1. DaisyBill
    January 19th, 2017 at 07:23 | #1

    Enjoyed your post, as always! Couple of things we’d like to add.

    We’ve actually found that the declaration does not apply to liens filed prior to 2013 – it comes down to a difference between the “filing fee” and the “activation fee.” They’re given different definitions in the Labor Code.

    The “filing fee” applies to liens submitted after Jan 1, 2013. “Activation fee” is for pre-2013 liens. And the new rules state that only liens subject to the “filing fee” need the declaration by July 1st.

    There was a story about this on Work Comp Central back in mid-December. We’ve also got a blog post (with the new lien forms) and webinar that touch on this. (http://blog.daisybill.com/dwc-releases-new-lien-forms-to-comply-with-sb-1160) (http://info.daisybill.com/webinar-46-downloads)

    As far as knowing MPN status, we do agree that the new legislation should help cut back on fraud. But from a provider’s point of view, it can often be frustratingly difficult to ascertain MPN status. The DWC’s MPN list is a very user-unfriendly resource, and tracking down accurate information can be quite a challenge. If you’re interested, we’ve got a webinar on that, too: http://info.daisybill.com/webinar-47-downloads

    So many moving parts to this system… we always learn form considering different points of view. Looking forward to the next post!

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