Medical Confidentiality in Workers' Compensation

By  Heywood G. Friedman, Esq.  Founder and Managing Partner
LAW OFFICES OF FRIEDMAN & BARTOUMIAN

There is often confusion concerning the extent of medical information that a claims administrator may provide to an employer relative to an employee's claim for workers' compensation benefits. The controlling authority over this matter is found under Labor Code Section 3762. Subsection (a) of 3762 requires that the claim administrator discuss all elements of a claim file that affect an insured employer's premium, within certain limitations. Such elements include but are not limited to providing reserve information, disability payments and settlement documentation. The above requirements also apply to the information a claim administrator may provide to its self-insured employer client even though an insurance premium is not associated with self-insurance.
Although claims information is to be provided to an employer upon request, the content of that information is partially restricted. Subsection (c) prohibits insurers and third-party claim administrators from divulging medical information to the employer concerning an injured worker who has filed a claim, except in the following situations:

1. Medical information limited to the diagnosis of the mental or physical condition for which workers' compensation is claimed and the treatment provided for this condition;
2. Medical information regarding the injury for which workers' compensation is claimed that is necessary for the employer to have in order for the employer to modify the employee's work duties.

In our practice we have observed claims administrators that only comply with LC 3762(c)(2) and fail to observe the limitations within subsection (c)(l). Administrators are reluctant to share information about diagnosis and proposed treatment even though pursuant to subsection (c)(l) they are required to provide this information upon employer request.
Again, an insurer or third party administrator is permitted to disclose the diagnoses for a claimed industrial injury, but need not necessarily provide the information on how diagnosis was arrived at, such as the results of diagnostic testing. By way of example, the administrator may disclose thr1t ;in employee suffered severe knee damage from an industrial injury but may not disclose either the results of any diagnostic studies or the employee's medical history that would support the diagnosis.

Examples of medical information that may and may not be provided for a claimed industrial low back injury:
   

1. Information that may be provided to employer:

a.  Confirmation that industrial back injury was or was not diagnosed by an examining physician.

b.  Physical therapy treatments and medication prescribed for the low back injury.

c.  Dates of future medical appointments.

d.  Percentage of permanent disability for the low back

 e.  Anticipated return to work date along with medical restrictions to determine if permanent/temporary modified duty exists to allow employee to return to duty.

2. Information that may not be provided to employer:

a.  Results of diagnostic testing

b.  Unrelated current or past medical issues, including HIV/AIDS and other illnesses

c.  Past medical treatment

 d.  Prior injuries to other body parts and settlements

Case Law: As of now neither the courts nor the legislature have clarified the information that may be disclosed under LC 3762(c). However, notwithstanding LC 3762(c)(2) the right of an employer to obtain information concerning a workers' injury and claim was recognized by the WCAB in the decision of Padilla v. Los Angeles Metropolitan Transportation Authority, 2010 Cal. Wrk. Comp. P.D. LEXIS 249, which allowed an employee's manager to attend the employee's deposition without infringing on the employee's right to medical privacy. 

Intent of the Medical Confidentiality Law 
Legislation to create partial medical confidentiality under LC 3762 was prompted by two cases where medical information was divulged that had absolutely nothing to do with the claimed industrial injuries. Because of the nature of the cases, we do not divulge the identity of the injured workers in this paper. 

a.  In the first case a physician disclosed in their AME report how the injured worker suffered from an unrelated HIV/ AID condition, even though the claimed industrial injury was limited to a neck problem.

b.  The second case involved a carpal tunnel claim where the doctor mentioned in a medical report how the injured worker had a secretive abortion when she was a teenager. The report was shared by the claims administrator with the employer who happened to be the employee's father.

Disclosure to Broker/Agent Consultants:

Although not direct employees of the employer, an insurance broker, a claims consultant and/or a risk manager are, as agents of the employer, subject to the same limitations imposed upon the employer under the Labor Code as to what medical information a claim administrator may provide to them. Under the eyes of the law the broker, claims consultant, risk manager and employer are one and the same. Therefore, LC 3762 applies not only to the employer but also to such third parties that represent that employer. 

Former Employers/Employees: 

The law is silent on whether the protections of LC 3762 apply to former employers. All too often employees file a workers' compensation claim and then later either quit their employment or they file a claim after employment has ended. Technically speaking when such claims occur the employer is no longer the current employer but instead is a former employer. Does it make a difference? We don't know the answer since there is no guidance from the legislature or courts on this issue. 

One may argue that a former employer in workers' compensation is always referred to as the employer, even when the injured worker no longer is employed by the company. When an employee quits his job and files a claim the former employer is always referred to as the employer. 

On the other hand, others may argue there is a significant difference between a current and former employer in a workers' compensation case. For example: The courts have held that a former employer who discriminates against an injured worker by providing a poor reference to a prospective new hirer as a means of retribution against the worker for filing an industrial claim, cannot be held liable for a LC 132a penalty, because an employment relationship did not exist at the time of the discriminatory act. As a condition precedent to a 132a action the courts have held that an employment relationship must exist at the time of the alleged discriminatory act. Therefore, former employers who commit acts of discrimination after employment has ended cannot be held liable for a 132a penalty. 

For more information on how to navigate the limitations imposed under LC 3762 when dealing with an employer seeking access to employee medical information, feel free to contact the experts at the Law Firm of Friedman + Bartoumian, who bring over 30 years of practical experience to the table. Feel free to send an email to the firm's founder, Heywood G. Friedman, Esq., at heywood@friedmanlawoffices.com, or call 818 707 1488. 
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