New Court of Appeals Ruling on Medical Provider Applications

Written by Bob McAdam, Esq.

Edited by Rachel Riordan, Esq.

In a case of first impression, the Court of Appeals of Virginia has interpreted Virginia Code §65.2-501.1 in Roanoke Ambulatory Surgery Center v. Bimbo Bakeries , USA, 69 Va.App. 675, 822, S.E.2d 675 (2019).

In Bimbo Bakeries (BB), the Claimant was injured while working for BB on February 23, 2015.  RASC provided treatment to the Claimant. On April 29, 2015, RASC performed a rotator cuff repair surgery.  RASC submitted a bill of $24,000 for the surgery to BB.  On June 12, 2015, BB delivered payment of $5000 to RASC and a “Review Analysis” that the balance of the bill was objected to as being in excess of the amounts authorized by law.

RASC performed a second surgery on the Claimant on September 18, 2015 and submitted a bill for $12,000 to BB. On October 30, 2015, BB delivered to RASC payment of $3000 and a “Review Analysis”, again arguing that the bill was in excess of amounts authorized by law.

The Claimant filed his Claim for Benefits on June 27, 2016 for the accident of February 23, 2015.  On July 28, 2017, the Commission approved an agreement between the Claimant and BB for lifetime medical benefits for treatment of his right shoulder rotator cuff injury.

On September 1, 2017, RASC filed a claim with the Commission requesting full payment for the services it rendered to the Claimant. The Deputy Commissioner found that the claim was not time barred.

The Deputy Commissioner also noted that BB did not put forth any evidence to rebut the provider’s evidence that the charges were reasonable and necessary.   Since RASC’s claim was not time barred and since BB did not present any evidence that the medical fees were excessive, the Deputy Commissioner awarded RASC the balance of the surgical bills.

The Full Commission reversed, finding that the payments made by BB were “voluntary payments” and the Commission concluded that Code §65.2-605.1(F)(ii) did not apply and that the claim was time barred pursuant to Code §35.2-605.1(f)(i).

The Court of Appeals reversed, finding that the claim was not time barred.

The plain text of the relevant statute, Code § 65.2-605.1(F), states, in full:

No health care provider shall submit a claim to the Commission contesting the sufficiency of payment for health care services rendered to a claimant after July 1, 2014, unless (i) such claim is filed within one year of the date the last payment is received by the health care provider pursuant to this section or (ii) if the employer denied or contested payment for any portion of the health care services, then, as to that service or portion thereof, such claim is filed within one year of the date the medical award covering such date of service for a specific item or treatment in question becomes final.

RASC argue that the plain meaning of this Code section is that there are two alternative statutes of limitation, (i) and (ii).  RASC argues that the disjunctive “or” between the two clearly means that there are two statutes of limitation.

RASC concedes that the claim is barred under subsection (i) but argues that the factual scenario falls under subsection (ii).

In reversing the Full Commission, the Court of Appeals limited it’s review to the interpretation of Code §65.2-605.1[1]. The Court charged itself to see whether subsection (i) or (ii) is applicable.

The Court first noted that Code §65.2-601.1(F) uses the disjunctive “or” if the medical provider files its claim in such a way that it complies with either (i) or (ii) , the claim is timely filed.

As the Court noted, there is no doubt that the claim is time barred if subsection (i) is applied because RAC received the payments in 2015 and did not file its claim until 2017, well beyond one year from the receipt of either payment.

The Court’s analysis of subsection (ii) is the key to the opinion.  The Court noted that Subsection (ii) applies  “if the employer denies or contested payment for any portion of the health care services.”

BB clearly contested payment for the amount billed beyond the small percentage of the bills it paid.        The contesting of the bill for each of the two surgeries is clear from the language used on both of the “Review Analysis” documents authored by BB.  BB used the language that “amounts billed above the recommended allowance are hereby objected to as being in excess of the amounts authorized by law.”

In summary, because the Employer “denied or contested payment” and because the Commission had issued an award, subsection (ii) applies in this situation.

If section (i) applied then RASC would have had to file its’ claim before the Claimant even filed his Claim for Benefits.

Practice Pointers:

  • In many circumstances the Medical Award is awarded within a few months of the date of the injury. In those cases it probably will not matter too much which subsection applies.
  • If the Carrier wants to contest a bill because of the cost and because of the medical necessity both issues should be raised to the medical provider at the time only a portion of the bill is being paid, or if the bill is denied entirely.
  • Make sure that you know what dates the medical bills have been denied or partially paid.
  • Do not forget Virginia Code §65.2-604 and the cases interpreting it. When a physician fails to provide medical records pertaining to the bills within a reasonable time the Carrier might not be responsible for payment of those bills.



[1] The Court noted that BB did not present any evidence to rebut RASC’s evidence that the charges were reasonable and necessary.

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