Insurer escapes 60-day deadline to challenge compensability

An insurer in Texas has 60 days from the time it receives notice of an initial injury to dispute compensability and 45 days from the date it receives a complete medical bill to dispute whether the treatment was necessary.

Case name: Zenith Insurance Co. v. Ayala, No. 09-0292 (Tex. 06/11/10, unpublished).

Ruling: In an unpublished decision, the Texas Supreme Court ruled that in a case where an insurer disputed entitlement to benefits for an amended diagnosis, the 60-day deadline for challenging compensability does not apply because it was a dispute about the extent of injury.

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What it means: An insurer in Texas has 60 days from the time it receives notice of an initial injury to dispute compensability and 45 days from the date it receives a complete medical bill to dispute whether the treatment was necessary.

Summary: A worker was injured when a window fell on her back at work. She was originally diagnosed with a back sprain/strain. The insurer received notice of the injury and began paying benefits. Soon after, the worker's original diagnosis was revised to include a lumbar condition. The insurer preauthorized treatment which was performed. Three months later, the insurer notified the worker that it was disputing her entitlement to benefits for the lumbar condition because the condition was degenerative and resulting from her work-related injury. The Texas Supreme Court held that the 60-day period for challenging compensability did not apply to a dispute over the extent of injury.

The worker argued that this was not an extent of injury case but a compensability issue. The court noted that the insurer only disputed the subsequent diagnosis of a lumbar condition. The court explained that the insurer had 45 days from the time it received a complete medical bill to dispute whether the treatment was necessary.

The worker also argued that the insurer preauthorized the treatment for the lumbar condition, so it should be required to pay for the treatment. The court stated that preauthorization does not, in and of itself, make an insurer liable. The court noted that an insurer could still dispute that a condition is not related to the compensable injury when treatment was preauthorized for the condition.

Read more at the WorkersComp Forum homepage.

September 13, 2010

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