STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

JACK BRADLEY, JERRY BALESTER, ) THOMAS ENGLERT, DONALD H. WOELTJEN, ) D.C., AND FLORIDA CHIROPRACTIC )

ASSOCIATION, INC., )

)

Petitioners, )

)

vs. ) CASE NO. 92-3319RP

)

DEPARTMENT OF LABOR AND )

EMPLOYMENT SECURITY, DIVISION )

OF WORKERS' COMPENSATION, )

)

Respondent. )

and )

)

FLORIDA PHYSICAL THERAPY )

ASSOCIATION, INC., )

)

Intervenor. )

)

FINAL ORDER

The final hearing in the above-styled matter was heard pursuant to notice by Stephen F. Dean, assigned Hearing Officer of the Division of Administrative Hearings, on July 21, 1992, in Tallahassee, Florida.

APPEARANCES

FOR PETITIONERS: Stephen Marc Slepin, Esquire

Slepin & Slepin

1114 East Park Avenue Tallahassee, FL 32301

Paul Watson Lambert, Esquire 2851 Remington Green Circle Suite C

Tallahassee, FL 32308-3749

FOR RESPONDENT: Edward A. Dion, Esquire

Assistant General Counsel Florida Department of Labor

and Employment Security Tallahassee, FL 32399-2189

FOR INTERVENOR: Robert S. Cohen, Esquire

Haben, Culpepper, Dunbar & French, P.A.

Post Office Box 10095 Tallahassee, FL 32302

STATEMENT OF THE ISSUES

Whether the Proposed Rules 38F-7.800 thru 7.807, published in Volume 18, No. 19, Florida Administrative Weekly, promulgated by the Department of Labor and Employment Security (DLES) exceeded the authority delegated to the Department by the legislature. Specifically, whether (1) the Department's proposed rules impinge upon the practice of medicine by chiropractors, osteopaths, and homeopaths by restricting the reimbursement for care rendered for certain defined types of care within defined time frames to an occupational therapist and physical therapist, and (2) whether the department followed the correct procedures in approving a new medically necessary service.

PRELIMINARY STATEMENT

The Petitioners challenged various portions of the rules proposed by DLES, to include Rules 38F-7.800 thru 7.807, Florida Administrative Code, by petitioner filed May 29, 1992. On June 2, 1992, the case was assigned to the Hearing Officer, who set it for final hearing on June 19, 1992. On June 9, 1992, the Intervenor filed its Motion to Intervene. The Petitioners' moved to continue the case without objection, and the matter was reset for July 21, 1992.

At the hearing, the Petitioners presented the testimony of three doctors of chiropractic, and five exhibits. DLES presented two witnesses and three exhibits. Intervenor presented the testimony of one witness and seven exhibits. Joint exhibits 1-4 were also presented. All of the exhibits were received into the record.

A transcript was prepared and filed August 7, 1992. Proposed Final Orders were due to be filed on August 27, 1992; however, the parties requested and were granted an extension. All of the parties submitted proposed findings which were read and considered. The Petitioner's proposed final order did not contain any paragraph numbers. All of the Petitioner's paragraphs are referred to in the Final Order by their paragraph number beginning with paragraph 1 on the top of page 1 through paragraph 83 on page 23. Appendix A states which of the findings were adopted and which were rejected and why.

FINDINGS OF FACT

STANDING

1. The Department of Labor and Employment Security (DLES) is the agency responsible for administering the state's workmans' compensation program and promulgating the rules relating to workmans compensation which are the subject of the challenge in this proceeding.

   
   

2. Donald H. Woeltjen, D.C., is a chiropractic physician licensed to practice in the State of Florida pursuant to Chapter 460, Florida Statutes. He treats patients who have been injured on the job, and receives compensation from the treatment of these patients. He is President of the Florida Chiropractic Association, Inc.

   
   

3. The Florida Physical Therapy Association, Inc., is a Florida corporation organized by physical therapists licensed and working in the state. The financial interests of physical therapists are directly affected by the proposed rules and the challenge to the proposed rules.

4. The Florida Chiropractic Association, Inc., is a Florida corporation representing doctors of chiropractic in the state. The financial interest of chiropractors are directly affected by the proposed rules.

   
   

5. The time frames stated in the preliminary statement above for publishing the proposed rules, filing the petition challenging them, and intervening in this proceeding are adopted and made part of these findings of fact.

   
   

   GENERAL

   
   

6. Among the changes which may occur to the injured person is a loss of physical conditioning as the result of the injury and treatment. Before the patient can regain his or her physical abilities, that lost strength and control must be regained. According to the department, the purpose of the proposed rules are to provide health care for this type of remedial treatment to increase endurance, strength, flexibility, and motor control. The department defined this type of medical service as "physical reconditioning."

   
   

7. The particular portions of the proposed rules being challenged are indicated by underlining below:

   
   

   1. Proposed Rule 38F-7.802(1) provides: "Physical reconditioning" means an intensive, goal oriented, systematic process specifically designed to restore an individual's systemic neuromusculoskeletal structure and function (strength, endurance, flexibility and motor control).

   2. Proposed Rule 38F-7.802(5) provides: "Physical reconditioning provider" means an occupational therapist, licensed pursuant to Chapter 468, FS., or a physical therapis, licensed pursuant to Chapter 486, FS.

   3. Proposed Rule 38F-7.803(2) provides: Physical reconditioning shall not begin before

      30 days have elapsed following the injury nor shall it begin or continue after 180 days following the date of injury, except on the specific recommenda-tion of a CARF-accredited interdisciplinary team's evaluation which includes musculoskeletal, behavioral, and vocational issues as well as a functional capacity evaluation (FCE) as provided in Rules 38F-8.021(7), F.A.C.

   4. Proposed Rule 38F-7.806(2),e, provides: Acute and sub-acute remedial physical medicine services for the purpose of pain control, muscular relaxation, improved circulation, and remobili-zation to promote normal function, which provided concurrently with a physical reconditioning program, shall be authorized to be provided solely by the physical reconditioning provider and shall be included in the reimbursement for the physical reconditioning program. Examples of modalities and procedures typically rendered

      in acute and sub-acute levels of care included moist heat, ice, electrical stimulation, massage, low intensity stretching and range of motion exercises, and training in proper body mechanics.

   5. Proposed Rule 38F-7.806(2),f, provides:

      Acute or sub-acute remedial physical medicine services as described in Rule 38F-7.806(1)(e), F.A.C., shall not be reimbursed to any physical medicine provider subsequent to 180 days from the injured employee's date of accident unless there is a medical necessity, documented by objective radiological findings or a neurological deficit or a surgical intervention necessitating the services.

      
      

8. In conjunction with the proposed rules, the department is including the treatment modalities included in the numerical codes 97010 through 97145, 97530, 97531, 97540, 97541, 97701, 97720, 97752, and 97799 of the Workers' Compensation Health Care Provider Reimbursement Manual, which is incorporated in the Division's rules 38F-7.020, F.A.C., within "physical reconditioning."

   
   

9. These modalities are included in the term "physical medicine" and are within the scope of practice of various types of physicians, to include chiropractors, osteopaths, and homeopaths.

   
   

10. The department admits that these treatments are within the scope of practice of physical medicine, and that under the rule these physicians will not be reimbursed for rendering this care.

    
    

    RULE MAKING AUTHORITY

    
    

11. Rulemaking authority is granted DLES in Sections 440.591, which provides as follows:

    
    

    440.591 Administrative procedure; rulemaking authority. The division shall have the authority to adopt rules to govern the performance of any programs, duties, or responsibilities with which it is charged under this chapter.

    
    

12. In publishing the proposed rules, the department stated that the laws implemented by the proposed rules are Sections 440.13,(1),(d) and (2),(d), Florida Statutes, which provide as follows:

    
    

    (1)(d) "Medically necessary" means any service or supply used to identify or treat an illness or injury which is appropriate to the patient's diagnosis, consistent with the location of service and with the level of care provided. The service should be widely accepted by the practicing peer group, should be based on scientific criteria, and should be determined to be reasonably safe. The service may not be of an experimental, investigative, or research nature, except in those instances

    in which prior approval of the division has been obtained. The division shall promulgate rules providing for such approval on a

    case-by-case basis when the procedure is shown to have significant benefits to the recovery and well-being of the patient.

    (2)(d) If the employer fails to provide such treatment, care, and attendance after request by the injured employee, the employee may do so at the expense of the employer, the reasonableness and the necessity to be approved by a judge of compensation claims.

    The employee shall not be entitled to recover any amount personally expended for such treatment or service unless he has requested the employer to furnish the same and the employer has failed, refused, or neglected to do so or unless the nature of the injury required such treatment, nursing, and services and the employer or the superintendent or foreman thereof, having knowledge of such injury, has neglected to provide the same.

    Nor shall any claim for medical, surgical, or other remedial treatment be valid and enforceable unless, within 14 days following the first treatment, except in cases where first-aid only is rendered, within 14 days following the date of maximum medical improvement of the date of final treatment , and at such intervals as the division by regulation may prescribe, the health care provider or health care facility giving such treatment or treatments furnishes to the employer, or to the carrier if the employer is not self-insured, a report of such injury and treatment on forms prescribed by the division; however, a judge of compensation

    claims, for good cause, may excuse the failure of the health care provider or health care facility to furnish any report within the period prescribed and may order the payment to such employee of such remuneration for treatment or service rendered as the judge of compensation claims finds equitable. Along with such reports, the health care provider shall furnish a sworn statement that the treatment or services rendered were reasonable and necessary with respect to the bodily injury sustained. The sworn statement shall read as follows: "Under penalty of perjury, I declare that I have read the foregoing; that the facts alleged are true, to the best of my knowledge and belief; and that the treatment and services rendered were reasonable and necessary with respect to the bodily injury sustained."

13. The proposed rules in no way implement any portion of Section 440.13,(2),(d), supra, quoted above.

    
    

14. Section 440.13, supra, makes no mention of "physical reconditioning," "physical therapist," or "occupational therapist."

    
    

15. Section 440.13, supra, defines medical services and supplies compensable under the act, and provides a mechanism for expanding those services. Section 440.13, supra, also defines "Health care facility," Health care provider," and "physician." Health care provider is defined by Section 440.13,(1),(b),supra, as,

    
    

    . . . a physician or any recognized practitioner who provides skilled services pursuant to the prescription of or under the supervision or direction of a physician.

    
    

    PHASES FOR RECOVERY

    
    

16. It is accepted that an injured person may pass through three general phases between injury and recovery or maximum medical improvement: acute, subacute, and chronic.

    
    

17. The acute phase is the period immediately following the injury in which treatment is directed at stopping bleeding, maintaining breathing, setting bones, and reducing or eliminating swelling and pain to promoting healing. This phase last from the time of injury until four to six weeks afterward. Nurses and other health care professionals would render care to a patient during this phase as prescribed and managed by the primary care physician. Primary care physical treatment modalities are defined in the department's manual to include hot or cold packs, traction, electrical stimulation, vasopneumatic devices, paraffin bath, microwave, whirlpool, diathermy, infrared, and ultraviolet. The proposed rules define these modalities as "physical reconditioning" and provide reimbursement only to physical therapists.

    
    

18. The subacute phase is an intermediate phase, and lasts from four to six weeks after the injury until about 180 days after the injury. As one might expect, there is an overlapping of acute care and subacute care. Again, nurses and other health care professionals would render care to a patient during this phase as prescribed and managed by the primary care physician. Primary care physical treatment modalities, as described above, may be prescribed by the primary care physician during this phase.

    
    

19. The last phase which may occur is the chronic phase in which the nature of the injury or its severity require continuing care or treatment of the residual effects of the injury. For purposes of the department's proposed rule, this phase is deemed to be 180 days after the initial injury on the basis that most people will recover from their injury within 180 days if they are going to recover. If they have not recovered within 180 days, most of them will continue to suffer some chronic effect of the injury. Medical treatment for the chronic or residual effects of injury is managed by the primary care physician.

    
    

    DEPARTMENT'S RATIONALE

    
    

20. The department states that it limited reimbursement for physical treatment modalities for "physical reconditioning" because the use of physical therapists and occupational therapists in a Commission on Accreditation of

    Rehabilitation Facilities (CARF) interdisciplinary team was consistent with the Department's current standards, and education and training of those disciplines were more closely aligned with the concept of physical reconditioning. The department states that chiropractors do not offer the types of structured active exercise and job simulation programs sought to be provided by the proposed rules designed to promote "physical reconditioning."

    
    

21. The department also states that it based the proposed rules on its legislative charge to contain the costs of providing health care to injured workers. The challenged rules purportedly reduce the cost of this care by limiting the reimbursement for 'remedial' physical treatment modalities to those rendered by a physical and occupational therapists in the acute, subacute, and chronic phases.

    
    

    COMPLIANCE WITH SECTION 440.13, FLORIDA STATUTES

    
    

22. The department's intent was to create this new program, physical reconditioning, and limit reimbursement for providing physical reconditioning services to physical therapists. T-II, 196-197.

    
    

23. The proposed rules, while purportedly implementing Section 440.13, Florida Statutes, were not the product of the peer review process for designated new medically necessary procedures outlined in Section 440.13, supra. The principal contributor to the department's rules, a physical therapist, stated he worked in conjunction with a department study group which contained no chiropractic or osteopathic physicians in promulgating the proposed rules.

    
    

24. The new service of "physical reconditioning" has been designated by the proposed rules as a medically necessary service without the input of any of the physicians who would prescribe such a service. See T-II,158-159.

    
    

25. The proposed rules include physical medicine services previously rendered by all types of physicians within the definition of "physical reconditioning," and deny the physicians reimbursement for those services. These are services which physicians are obliged to provide to their patients under their respective medical practice acts.

    
    

    CARF-ACCREDITED INTERDISCIPLINARY TEAMS

26. The proposed rule provides in pertinent part: Physical reconditioning shall not begin before

    30 days have elapsed following the injury nor shall it begin or continue after 180 days following the date of injury, except on the specific recommenda-tion of a CARF-accredited interdisciplinary team's evaluation [.]

    
    

27. As used in the Proposed Rule 38F-7.803(2), CARF is either certifying teams or facilities. CARF is the certifying authority for physical therapy facilities operated by physical therapists. It does not certify "interdisciplinary teams" according to its director. CARF will not list a Chiropractic Physician as a provider. The proposed rule's requirement for CARF certification effectively prevents reimbursement of treatment in chiropractic physical therapy facilities.

28. The department buttresses its requirement for "CARF- accredited interdisciplinary team evaluation" upon the department's requirement to publish a directory of rehabilitative facilities pursuant to Section 440.49, Florida Statutes. However, CARF is not mentioned in Section 440.49, supra.

    
    

29. Section 440.13,(1),(a), supra, defines health care facility as:

    
    

    . . . any hospital licensed under chapter 395 and any health care institution licensed under Chapter 400.

    
    

30. Section 440.13, supra, does not reference CARF and does not consider health care facilities other than those referenced above.

    
    

31. The department's proposed rule attempts to create an new class of health care facility (CARF certified) not contemplated in the statute. Requiring CARF accreditation of facilities is contrary to the specific provisions of Section 440.13,(1),(a), supra, the statute which the proposed rules purportedly implement.

    
    

32. Another accrediting organization exists, the Joint Commission of Accreditation of Healthcare Organizations (JCAHO), of which CARF was once a part.

    
    

33. Chiropractic physicians do maintain facilities which provide a complete range of rehabilitative services. Some of the facilities operated by chiropractors employ physical therapists who the chiropractor supervises. However, the chiropractor would be the provider for reimbursement purposes.

    
    

34. CARF is not subject to the regulation of the department, or any other agency of state government.

    
    

    COST CONTROL

    
    

35. It was not demonstrated that the proposed rules would decrease the costs of care of injured workers.

    
    

36. It was demonstrated that, under the proposed rules, reimbursement would be made to physical therapists for treatments within the area of practice of other health care professionals for care which these health care professionals currently render.

    
    

37. To the extent that two providers would now be charging for the services formerly rendered by one provider, the costs of the services would more that likely increase. The cost of administration would certainly increase.

    
    

    CONCLUSIONS OF LAW

    
    

38. The Division of Administrative Hearings has jurisdiction over the parties pursuant to Section 120.54, Florida Statutes. Based upon the facts presented, the Petitioner has standing to challenge Rules 38F-7.800 thru 7.807, Florida Administrative Code, promulgated by the Department of Labor and Employment Security.

    
    

39. As stated in the Findings, above, there is no relationship between the proposed rules and Section 440.13(2)(d), Florida Statutes. Section 440.13(1)(d), Florida Statutes, provided as follows:

    440.13 Medical services and supplies; penalty for violations; limitations.

    (1) As used in this section, the term:

    1. "Health care facility" means any hospital licensed under chapter 395 and any health care institution licensed under chapter 400.

    2. "Health care provider" means a physician or any recognized practitioner who provides skilled services pursuant to the prescription of or under the supervision or direction of a physician.

    3. "Medically necessary" means any service or supply used to identify or treat an illness or injury which is appropriate to the patient's diagnosis, consistent with the location of service and with the level of care provided. The service should be widely accepted by the practicing peer group, should be based on scientific criteria, and should be determined to be reasonably safe. The service may not be of an experimental, investigative, or research nature, except in those instances in which prior approval of the division has been obtained. The division shall promulgate rules providing for such approval on a case-by-case basis when the procedure is shown to have significant benefits to the recovery and

       well-being of the patient.

    4. "Peer review" means an evaluation by a peer review committee, after utilization review, of the appropriateness, quality, and cost of health care and health services provided a patient, based on medically accepted standards.

    5. "Peer review committee" means a committee composed of physicians licensed under the same authority as the physician who rendered the services being reviewed.

    6. "Physician" means a physician licensed under chapter 458, an osteopath licensed under chapter 459, a chiropractor licensed under chapter 460, a podiatrist licensed under chapter 461, an optometrist licensed under chapter 463, or a dentist licensed under chapter 466.

    
    

40. The general scheme of regulation set out in the section recognizes the primacy of the physician as the primary care giver and case manager, and provides a means for approving added medically necessary services. While the department's efforts to increase the scope of treatment is meritorious, its rules have no rationale relationship to the end being sought, and do not follow the statutory process in the Section 440.13, supra, for adding services.

    
    

41. The department states that its purposes are (1) to provide additional "reconditioning" services, and (2) to contain costs by mandating that these services be performed by physical therapists. The Intervenor's witness

    testified that there was no intent to deny reimbursement to physicians for "physical reconditioning;" however, the department's witness and its rules state that only a physical therapist would be reimbursed for physical treatment modalities rendered during the acute, subacute and chronic phases of treatment.

    
    

42. Physical treatment modalities provided during the acute phase for treatment of pain and circulation (reduction of swelling) will not be reimbursed to providers except for physical therapists according to Proposed Rule 38F- 7.806,(2),e, quoted above in the Findings. The expert testimony was that primary care includes treatment for reduction of swelling and control of pain.

    
    

43. Such care is both remedial and primary. As evidenced by the conflicting testimony of the witnesses, confusion already exists regarding whether these services are reimbursable to physicians. Clearly, an insurer would have good cause to deny reimbursement for physical treatment modalities included in "physical reconditioning" provided by a physician while rendering acute care. Clearly, this unduly and improperly encroaches upon the various medical practice acts; is far beyond the scope of Section 440.13, supra.

    
    

44. Further, the standards of practice dictate that the physician render the service; therefore, the patient will have to pay for this service. This type of care will always be rendered in acute cases and may be rendered in subacute cases; however, "physical reconditioning" is not necessary in all cases. The proposed rule works to the advantage of the physical therapist but to the disadvantage of the patient who will bear the costs of these services when the insurer disallows the physician's charges for these services. Such a process cannot result in economical administration of the system.

    
    

45. As the First District Court of Appeal stated in Florida League of Cities, Inc. v. Department of Environmental Regulation, Case No. 90-1733, Opinion filed July 25, 1991 concerning a rule of the Department of Environmental Regulation regarding minimum standards for disposal of domestic wastewater residuals:

    
    

    The challenger, among other things, is required to show that the requirements of the rule are inappropriate to the ends specified in the legislative act, or that the requirements proposed are not reasonably related to the purpose of the enabling legislation, or that the proposed rule is arbitrary and capricious. [Court cites Agrico Chemical Co. v. Department of Environmental Regulation, 365 So.2d 759, and Marine Fisheries Common v. Organized Fishermen of Fla., 503 So.2d 935, 938 (Fla. 1st DCA).]

    
    

46. Proposed Rule 38F-7.806(2),e, supra, is not reasonably related to the purposes of Section 440.13, supra, and "is an invalid exercise of delegated legislative authority." See 120.54, Florida Statutes.

    
    

47. Regarding Proposed Rules 38F-7.802(1),(2), and (5), supra, the department has the authority pursuant to Section 440.13(1)(d), supra, to define new medical services for which it will provide reimbursement consistent with other statutes regulating practice of the healing arts. Assuming, arguendo, that the Department adhered to the mechanism for defining new treatments in Section 440.13, supra, it may not define, as it has, a new service to limit

    medical treatments already accepted and defined within the limits of practice of other healing arts by the statutes regulating those arts. In these rules the Department, contrary to its assertions, is limiting accepted existing medical practice by several specialties in the guise of creating a new area of service.

    
    

48. There is a specific mechanism in the statute for initiating the process of adding to medically necessary treatments. Section 440.13(1), supra, provides:

    
    

    (c) "Medically necessary" means any service or supply used to identify or treat an illness or injury which is appropriate to the patient's diagnosis, consistent with the location of service and with the level of care provided. The service should be widely accepted by the practicing peer group, should be based on scientific criteria, and should be determined to be reasonably safe. The service may not be of an experimental, investigative, or research nature . . .

    1. "Peer review committee" means a committee composed of physicians licensed under the same authority as the physician who rendered the services being reviewed.

    2. "Physician" means a physician licensed under chapter 458, an osteopath licensed under chapter 459, a chiropractor licensed under chapter 460, a podiatrist licensed under chapter 461, an optometrist licensed under chapter 463, or a dentist licensed under chapter 466.

    
    

49. The statute does not provide a mechanism for physical therapists to redefine "physical reconditioning" as medically necessary. A group of physicians rendering "physical reconditioning" did not propose adding this service. The record shows that the proposed rules were not the product of a peer review committee envisioned in the statute.

    
    

50. The department has not exercised the authority granted to it by the legislature in the manner which was prescribed with regard to the adoption of the Proposed Rules 38F-7.802(1)and (5); 38F-7.803(2); and 38F-7.806(2),f.

ORDERED that the Proposed Rules 38F-7.802(1)and (5); 38F-7.803(2); and 38F- 7.806(2),f, are an invalid exercise of delegated legislative authority.

DONE AND ENTERED this 30th day of September, 1992, in Tallahassee, Leon County, Florida.

STEPHEN F. DEAN

Hearing Officer

Division of Administrative Hearings The DeSoto Building

1230 Apalachee Parkway

Tallahassee, FL 32399-1550

(904) 488-9675

Filed with the Clerk of the Division of Administrative Hearings this 30th day of September, 1992.

APPENDIX A

Both parties submitted proposed findings which were read and considered.

The Petitioners did not number the paragraphs of their Proposed Recommended Order, and the references herein are to the paragraphs in their sequential order from paragraph 1 on page one. Petitioner's findings of fact begin with paragraph 10 on page 3. The following proposals were adopted as indicated, or rejected for the reason stated:

Petitioner's Proposed Findings:

Respondent's Proposed Findings:

Para 10,11 Subsumed in FO Para 8,9 and 17.

Para 12 FO Para 18.

Para 13 Subsumed in FO Para 19.

Para 14,15 Subsumed in FO Para 6.

Para 16 Irrelevant. This statute addresses rehabilitation facilities, not medically necessary services.

Para 17 Subsumed in FO Para 20,21.

Para 18 Contrary to more credible evidence.

Para 19,20 Evidence was presented that this was the Department's vision; however, it is both irrelevant and contrary to more credible evidence.

Intervenor's Proposed Findings:

Para 1-4 Subsumed in FO Para 20,21.

Para 5 Subsumed in FO Para 23.

Para 6 Rejected as contrary to fact.

Para 7,8 Irrelevant because the issue is reimbursement for provid ing the

COPIES FURNISHED:

Stephen Marc Slepin, Esquire 1114 East Park Avenue Tallahassee, FL 32301

Paul Watson Lambert, Esquire Suite C

2851 Remington Green Circle Tallahassee, FL 32308-3749

Cecelia Renn, General Counsel Florida Department of Labor

and Employment Security

2012 Capital Circle, Suite 309

Tallahassee, FL 32399-2189

Robert S. Cohen, Esquire Post Office Box 10095 Tallahassee, FL 32302

Carroll Webb, Executive Director Administrative Procedures Committee

120 Holland Building Tallahassee, Florida 32399-1300

Liz Cloud, Chief

Bureau of Administrative Code Room 1802, The Capitol Tallahassee, Florida 32399-0250

A PARTY WHO IS ADVERSELY AFFECTED BY THIS FINAL ORDER IS ENTITLED TO JUDICIAL REVIEW PURSUANT TO SECTION 120.68, FLORIDA STATUTES. REVIEW PROCEEDINGS ARE GOVERNED BY THE FLORIDA RULES OF APPELLATE PROCEDURE. SUCH PROCEEDINGS ARE COMMENCED BY FILING ONE COPY OF A NOTICE OF APPEAL WITH THE AGENCY CLERK OF THE DIVISION OF ADMINISTRATIVE HEARINGS AND A SECOND COPY, ACCOMPANIED BY FILING FEES PRESCRIBED BY LAW, WITH THE DISTRICT COURT OF APPEAL, FIRST DISTRICT, OR WITH THE DISTRICT COURT OF APPEAL IN THE APPELLATE DISTRICT WHERE THE PARTY RESIDES. THE NOTICE OF APPEAL MUST BE FILED WITHIN 30 DAYS OF RENDITION OF THE ORDER TO BE REVIEWED.

================================================================= DISTRICT COURT OPINION

=================================================================

IN THE DISTRICT COURT OF APPEAL FIRST DISTRICT, STATE OF FLORIDA

DEPARTMENT OF LABOR AND NOT FINAL UNTIL TIME EXPIRES TO EMPLOYMENT SECURITY, DIVISION FILE MOTION FOR REHEARING AND OF WORKERS' COMPENSATION, DISPOSITION THEREOF IF FILED.

Appellant, CASE NOS. 92-3643/92-3705

and Consolidated

DOAH CASE NO. 92-3319RP

FLORIDA PHYSICAL THERAPY ASSOCIATION, INC.,

Intervenor/Appellant,

JACK BRADLEY, JERRY BALESTER, THOMAS ENGLERT, DONALD H. WOELTJEN, D.C., and FLORIDA CHIROPRACTIC ASSOCIATION, INC.,

Appellees.

/ Opinion filed May 3, 1994.

An appeal from an order of the Division of Administrative Hearings. Stephen F. Dean, Hearing Officer.

Edward A. Dion, Assistant General Counsel and Michael G. Moore, Tallahassee, for Appellant.

Robert S. Cohen of Haben, Culpepper, Dunbar & French, Tallahassee, for Intervenor/Appellant.

Stephen Marc Slepin and Paul Watson Lambert, Tallahassee, for Appellees.

JOANOS, J.

This appeal is from a final order of the Division of Administrative Hearings determining that certain proposed rules of the Department of Labor and Employment Security, Division of Workers' Compensation (Division), are an invalid exercise of delegated legislative authority. The issues are: (1) whether the hearing officer's findings of fact are supported by competent substantial evidence and the final order correctly interprets the proposed rules, (2) whether proposed rules of the Division of Workers' Compensation must be formulated or reviewed by a peer group, and (3) whether the hearing officer improperly shifted the burden of production and persuasion from petitioners/appellees to the Division of Workers' Compensation. We reverse.

The Division published the proposed rules at issue in the May 8, 1992, edition of the Florida Administrative Weekly. The proposed rules held to be invalid are 38F-7.802(1) and (5); 38F- 7.803(2); and 38F-7.806(2)(f). 1/ On

May 29, 1992, appellees Bradley, Balester, and Englert, workers' compensation claimants receiving treatment from chiropractors; Donald H. Woeltjen, D.C., and the Florida Chiropractic Association, Inc., filed a petition to challenge the proposed rules, pursuant to section 120.54(4), Florida Statutes (1991) . The petition alleged (1) the specific authority cited in the proposed rule does not authorize creating the term "physical reconditioning" or any of the other newly created terms proposed in the challenged rules; (2) the cited statutes do not authorize limited performance of physical therapy to "physical reconditioning providers," meaning physical therapists or occupational therapists, to the exclusion of physicians licensed and authorized by statute to provide those services; (3) Chapter 440 does not authorize "a CARF-accredited interdisciplinary team's evaluation," or limitation to one "accrediting" organization to the exclusion of other similar organizations that are equal to or exceed the "accrediting standards" of CARF; 2/ (4) the proposed new rules amend or modify section 440.13, and exceed the authority for rulemaking delegated to the Division, "constituting an invalid exercise of delegated . . . legislative authority under Subsection 120.54(4), Florida Statutes (1991). . .

." On June 9, 1992, the Florida Physical Therapy Association, Inc., filed a petition to intervene. The intervenor's petition alleged, in part:

A significant goal of the Division is to help contain the cost of providing health care to injured workers. The proposed rules provide a rational basis for containing those costs, are a valid exercise of the legislative authority delegated to the Division, are not arbitrary

or capricious, and are supported by law and fact.

At the final hearing, witnesses appearing on behalf of the Division testified the proposed rules were promulgated to address a perceived need that was not being met under the existing rules, i.e., that of the individual with needs between remedial acute and sub-acute care and the extensive and expensive interdisciplinary care provided for individuals with work-related disabling conditions that have become chronic. By these rules, the Division hopes to remedy the situation of the injured worker who becomes deconditioned during convalescence, thereby averting re-injury upon return to work. Also, the Division expects the physical reconditioning services to reduce the number of persons who become chronically disabled as a result of an industrial injury.

Under the proposed physical reconditioning rule, if a primary physician refers an injured worker for physical reconditioning, only a physical therapist or occupational therapist will be authorized to provide physical reconditioning services, and only the physical reconditioning provider will receive payment for such services. In other words, an authorized primary physician will not receive payment for physical medicine modalities he or she provides at the same time such services are being provided by a referral physical reconditioning provider.

The Division contemplates that the proposed rules will contain costs by virtue of reducing the risk of re-injury and chronic disabling conditions, and by virtue of precluding double billing for services included within the ambit of physical reconditioning. The Division's representative explained that under the rule, a primary physician would be reimbursed for physical medicine modalities provided within the first thirty days post-injury, i.e., during the acute and sub-acute stages of recovery. If, at the end of the acute and sub-acute stages of recovery, the primary physician determines the injured worker would benefit from physical reconditioning, the primary care physician would recommend or refer the injured worker for physical reconditioning. Only physical and occupational therapists would be authorized to provide those services. The proposed rules contemplate provision of physical reconditioning services, when indicated, no earlier than thirty days after the injury, with cessation of services 180 days post-injury, absent the existence of specific documented criteria. The 180-day cut- off period was based on medical and industrial studies which show that, in general, injury-related problems remaining six months post-injury have become chronic, and thus are not amenable to physical reconditioning.

Division personnel and consultants began conferring on the proposed rules in 1988 or 1989. The term "physical reconditioning" was based on the program's intent to meet the needs of the injured worker who was out of condition due to the inactivity attendant upon convalescence. The Division's decision to limit physical reconditioning providers to occupational and physical therapists was based on the entry level training requirements of these particular disciplines. Physical therapists and occupational therapists are held accountable for physical restoration and functional restoration as the sole focus of their practice. The proposed rules contemplate an active process whereby the injured worker takes responsibility for changing his or her own clinical situation with respect to functional or physical capabilities.

Since CARF is the accrediting association currently used by the state agency, the Division specified CARF as the accrediting association for the proposed rules. CARF is one of two national accrediting agencies accepted throughout the medical field. The rule drafters concluded that CARF standards were cost effective, because CARF is a non-profit, consumer advocacy organization. The Division did not give consideration to the chiropractic

rehabilitative association as an accrediting association for the proposed rules, because the association had not been formed when the proposed rules were promulgated.

The Division relied upon sections 440.13(1)(d) and 440.591, Florida Statutes (1991) as authority for promulgation of the proposed rules. In ruling that proposed rules 38F-7.802(1) and (5), 38F-7.803(2), and 38F-7.806(2)(f) are invalid, the hearing officer found the Division's adoption of the proposed rules was not in the manner prescribed by section 440.13(1), Florida Statutes. We disagree.

Resolution of the first issue requires consideration of the agency's rulemaking authority, and the principles governing the exercise of that authority. Legislative intent with respect to the workers' compensation law at issue here is set forth in section 440.015, Florida Statutes, 3/ which states in relevant part:

It is the intent of the Legislature that the Workers' Compensation Law be interpreted so as to assure the quick and efficient delivery of disability and medical benefits to an injured worker at a reasonable cost to the employer. . . .

See also Ch. 91-1, Preamble, Laws of Fla. The challenged rules were designed to implement delivery of the "medically necessary" services defined in section 440.13(1)(d), and the procedure outlined in section 440.13(2)(d). The agency's rulemaking authority is derived generally from section 440.591, Florida Statutes, which provides:

The division shall have the authority to adopt rules to govern the performance of any programs, duties, or responsibilities with which it is charged under this chapter.

More specific rulemaking authority is provided in section 440.13(1)(d), which states:

(d) "Medically necessary" means any service or supply used to identify or treat an illness or injury which is appropriate to the patient's diagnosis, consistent with the location of service and with the level of care provided. The service should be widely accepted by the practicing peer group, should be based on scientific criteria, and should be determined to be reasonably safe. The service may not be of an experimental, investigative, or research nature, except in those instances in which prior approval of the division has been obtained. The division shall promulgate rules providing for such approval on a case-by-case basis when the procedure is shown to have significant benefits to the recovery and well-being of the patient.

It is an established principle that "[w]here the empowering provision of a statute states simply that an agency `may make such rules and regulations as may be necessary to carry out the provisions of this act,' the validity of the regulations promulgated thereunder will be sustained as long as they are reasonably related to the purposes of the enabling legislation, and are not arbitrary or capricious." Adam Smith Enterprises v. Department of Environmental Regulation, 553 So. 2d 1260, 1271 (Fla. 1st DCA 1989). See also General Telephone Co. of Florida v. Florida Public Service Commission, 446 So.

2d 1063, 1067 (Fla. 1984); General Motors Corp. v. Department of Highway Safety & Motor Vehicles, 625 So. 2d 76, 78 (Fla. 1st DCA 1993).

In a rule challenge, "the burden is upon one who attacks a proposed rule to show that the agency, if it adopts the rule, would exceed its authority; that the requirements of the rule are not appropriate to the end specified in the legislative act; that the requirements contained in the rule are not reasonably related to the purpose of the enabling legislation or that the proposed rule or the requirements thereof are arbitrary or capricious." Agrico Chemical Co. v.

Department of Environmental Regulation, 365 So. 2d 759, 763 (Fla. 1st DCA 1978), cert. denied, 376 So. 2d 74 (Fla. 1979). Another settled principle in the area of administrative rulemaking is that--

agencies are to be accorded wide discretion in the exercise of their rulemaking authority, clearly conferred or fairly implied and consistent with the agencies' general statutory duties. . . . An agency's construction of the statute it administers is entitled to great weight and is not to be overturned unless clearly erroneous . . . the agency's interpretation of a statute need not be the sole possible interpretation or even the most desirable one; it need only be within the range of possible interpretations.

Department of Professional Regulation, Board of Medical Examiners v. Durrani,

455 So. 2d 515, 517 (Fla. 1st DCA 1984). See also GMC v. Dept. of Hwy. Safety, 625 So. 2d at 77; Florida League of Cities v. Department of Insurance, 540 So. 2d 850, 857 (Fla. 1st DCA 1989).

In this case, the Division's representatives testified that the proposed rules were designed to provide needed services to injured workers who fall between the acute/sub-acute and chronic stages of injury, which needs are not being addressed under the current system. Concomitantly, the proposed rules were designed to be cost effective in the sense that the physical reconditioning services contemplated by the rules will lessen the risk of re-injury to the deconditioned worker, and will help to avert the chronic stage of injury which requires expensive interdisciplinary care and treatment. In this regard, the record reflects that if a worker's injury-related problems remain unresolved six months after the injury, the disability becomes chronic in most cases.

Competent substantial evidence presented to the hearing officer indicates that the type of services contemplated by proposed rules 38F-7.802(1) and (5) are not being provided in the early intervention, structured manner contemplated by the proposed rules, and that a need for such services exists. Similarly, undisputed evidence established that, for the most part, any injury-related physical or vocational problems which continue for six months post-injury become chronic, thereby demonstrating the efficacy and reasonableness of proposed rule

38F-7.803(2), providing that physical reconditioning shall not begin before thirty days have elapsed following the injury, or begin or continue after 180 days following the date of injury. In addition, evidence was presented that the proposed rules' designation of CARF as an accrediting agency was consistent with current state practice, and is in accordance with the Division's duty to control costs. The thrust of the physical reconditioning rule is to avert chronic injury-related conditions. In this regard, the 180-day termination point for physical reconditioning is reasonably related to the provision of medically necessary services, and is neither arbitrary nor capricious.

The evidence demonstrates that acute and sub-acute medical care is intense treatment usually provided in the first thirty days following an injury. Since a physical reconditioning program cannot begin until thirty days after the injury and then only upon referral by a primary care physician, there will be few instances when proposed rule 38F-7.806(1)(e) would preclude payment to the primary care physician for physical medicine services. To the extent that the rule proscribes payment to two health care providers for the same service, it is reasonably related to the cost containment intent of section 440.015, and is neither arbitrary nor capricious. By the same token, competent substantial evidence established that residual problems remaining 180 days after the injury usually become chronic, and, as such, are treated through an interdisciplinary approach not subject to this rule. Therefore, the limitation period in proposed rule 38F-7.806(2)(f) is reasonably related to the provision of medically necessary services at reasonable cost to employers, and cannot be deemed arbitrary or capricious.

The Division is authorized "to adopt rules to govern the performance of any programs, duties, or responsibilities with which it is charged under this chapter." S. 440.591, Fla. Stat. (1991). Among other things, Chapter 440 charges the Division with the duty to deliver "medically necessary" services to injured employees. The evidence submitted by the Division demonstrates the medical necessity for the services contemplated by the proposed rules, and the designation of physical and occupational therapists as physical reconditioning providers is reasonable, in light of the training and standards of these particular disciplines. The rules contemplate delivery of an intermediate level of care, specifically designed to restore strength and flexibility, so as to avert the development of chronic disabling conditions or re-injury upon return to work.

Our examination of the record discloses that certain findings of the hearing officer are either without support in the record, or reflect a misperception of the evidence submitted. For example, the hearing officer found that the physical treatment modalities administered by the primary care physician during the acute stage of injury are defined in the proposed rules as "physical reconditioning," and that only physical therapists will be paid for these services. A fair reading of rule 38F-7.806(1)(e) indicates it is only when the listed modalities and procedures are provided by a primary care physician concurrently with a physical reconditioning program that the services "shall be authorized to be provided solely by the physical reconditioning provider and shall be included in the reimbursement for the physical reconditioning program." The record reflects that the primary authorized physician will bill for acute or sub-acute care under the Florida Workers' Compensation Provider Manual. Moreover, the physical reconditioning services contemplated by the proposed rules would not be administered during the acute stage, although there could be same overlap of sub-acute care and physical reconditioning services. Once the primary care physician refers an injured worker to a physical reconditioning program, he or she cannot bill separately

for physical treatment modalities being provided concurrently by a physical reconditioning provider. In other words, the rule does not permit a primary care physician to receive payment for physical reconditioning services provided concurrently by a referral physical reconditioning provider. However, the proposed rule does not preclude payment to the primary care physician pursuant to the Florida Workers' Compensation Provider Manual.

There is nothing in the record to support the hearing officer's finding that the challenged rules limit reimbursement for remedial physical treatment modalities to those rendered by physical and occupational therapists in the acute, sub-acute, and chronic phases of injury. It appears this finding was based on the hearing officer's failure to consider the rule provisions regarding concurrent payment. The testimony at the hearing indicated that the proposed rules were designed to meet the needs of injured workers in the stage between acute/sub-acute and chronic, without excessive cost to employers and carriers.

The Division proposes to do this by establishing programs that actively involve injured workers in their own rehabilitation prior to the six-month period deemed to be the point at which unresolved problems become chronic, due either to residual physical disability, attendant psychological overlay, or both. Cost containment is achieved by limiting reimbursement for physical reconditioning services to the referral physical conditioning provider. The primary care physician will continue to be reimbursed pursuant to the Manual.

The hearing officer also found that physicians are obliged to provide physical medicine services under their respective medical practice acts, but will be denied reimbursement for those services under the rule. The record indicates that primary care physicians rarely, if at all, provide structured exercise programs in the nature of the physical reconditioning contemplated by the proposed rules. Some health care professionals testified that if the need for physical reconditioning were indicated by a patient's condition, they would feel a duty to provide a structured program of exercise. Under the Division's construction of the proposed rules, if a chiropractor or other physician provided physical reconditioning services in his or her role as primary care physician, the services would be reimbursed under the Manual, so long as the same services were not being provided in a concurrent physical reconditioning program. If the primary care physician certifies that the injured worker should receive physical reconditioning, the rule provides that payment for referral physical reconditioning services will be made only to a physical therapist or occupational therapist, because these disciplines focus upon, and are held accountable for, physical results directly attributable to their efforts.

There is an absence of competent substantial evidence to support the hearing officer's conclusions that the proposed rules limit accepted medical practice by several specialties in the guise of creating a new area of service. The hearing officer's conclusion in this regard may have been derived from the assumptions expressed by several of appellees' witnesses. Such assumptions do not constitute reliable evidence of the nature required to invalidate proposed rules promulgated in accordance with an agency's rulemaking authority.

As the Division maintains, the final order contains numerous factual findings which are without support in the record. In addition, the order misconstrues the effect of the proposed rules. We conclude the Division's interpretation of its proposed rules is a permissible construction that comports with, and effectuates, clearly-stated legislative intent. See s. 440.015, Fla. Stat. (1991).

The second issue concerns the hearing officer's seeming determination that the Division's proposed rules must be formulated or reviewed by a peer review committee. The hearing officer's construction of sections 440.13(1)(c), (e), and (f), so as to require the Division to develop proposed rules through the vehicle of a "peer review committee" imposes an erroneous gloss upon the Division's rulemaking authority. Indeed, appellees concede error on this point, but urge the hearing officer's references to review of the Division's rules by a "peer review committee" should be treated as surplusage. We find no merit in this contention. Rather, the hearing officer's misperception of the Division's rulemaking authority is central to his finding that the proposed physical reconditioning rules are an invalid exercise of delegated legislative authority.

The third issue concerns the hearing officer's cost control findings. 4/ As the Division maintains, these findings indicate the hearing officer improperly shifted the burden to show cost containment to the Division.

Instead, as the party attacking the proposed rules, the burden was on appellees to demonstrate that the rules would not reduce the long-term costs of care of injured workers. See Agrico Chemical Co. v. DER, 365 So. 2d at 763.

We conclude the Division's authority to adopt proposed rules 38F-7.802(1) and (5), 38F-7.803(2), and 38F-7.806(2)(f) is reasonably implied by the express terms of sections 440.13(1)(d) and 440.591. Further, we conclude the proposed rules are reasonably related to the enabling legislation, and are not arbitrary or capricious.

Accordingly, the final order is reversed.

KAHN and WEBSTER, JJ., CONCUR.

ENDNOTES

1/ The following material is taken from the final order under review. The order sets forth the text of the proposed rules under attack, with the specific portion contested by appellees indicated by underscoring:

Proposed Rule 38F-7.802(1) provides: "Physical reconditioning" means an intensive, goal oriented, systematic process specifically designed to restore an individual's systemic neuromusculoskeletal structure and function (strength, endurance, flexibility and motor control).

Proposed Rule 38F-7.802(5) provides: "Physical reconditioning provider" means an occupational therapist, licensed pursuant to Chapter 468, FS., or a physical therapist, licensed pursuant to Chapter 486, FS.

Proposed Rule 38F-7.803(2) provides: Physical reconditioning shall not begin before 30 days have elapsed following the injury nor shall it begin or continue after

180 days following the date of injury, except on the specific recommendation of a CARF- accredited interdisciplinary team's evaluation which includes musculoskeletal,

behavioral, and vocational issues as well as a functional capacity evaluation (FCE) as provided in Rules 38F-8.021(7), F.A.C.

Proposed Rule 38F-7.806(1)(e), provides: Acute and sub-acute remedial physical medicine services far the purpose of pain control, muscular relaxation, improved circulation, and remobilization to promote normal function, which provided concurrently with a physical reconditioning program, shall be authorized to be provided solely by the physical reconditioning provider and shall

be included in the reimbursement for the physical reconditioning program. Examples of modalities and procedures typically rendered in acute and sub-acute levels of care included moist heat, ice, electrical stimulation, massage, law intensity stretching and range of motion exercises, and training in proper body mechanics.

Proposed Rule 38F-7.806(1)(f), provides: Acute or sub-acute remedial physical medicine services as described in Rule 38F- 7.806(1)(e), F.A.C., shall not be reimbursed to any physical medicine provider subsequent to 180 days from the injured employee's date of accident unless there is a medical necessity, documented by objective radiological findings or a neurological deficit or a surgical intervention necessitating the services.

The final order mistakenly numbers proposed rules 38F-7.806(1)(e) and 38F- 7.806(1)(f) as (2)(e) and (2)(f). The quoted text comes from proposed rules 38F-7.806(1)(e) and 38F-7.806(1)(f). Proposed rule 38F-7.806(2) contains only subparagraphs (a) through (c). For the sake of clarity, the numbering errors have been corrected in the quoted material.

2/ "CARF" is an acronym for the Commission on Accreditation of Rehabilitation Facilities. The organization publishes an annual standards manual known as The Standards Manual for Organizations Serving People With Disability.

3/ All references are to the 1991 edition of the Florida Statutes.

4/ The final order sets forth the following findings under the "Cost Control" caption:

1. It was not demonstrated that the proposed rules would decrease the costs of care of injured workers.

2. It was demonstrated that, under the proposed rules, reimbursement would be made to physical therapists for treatments within the area of practice of other health care professionals for care which these health care professionals currently render.

3. To the extent that two providers would now be charging for the services formerly rendered by one provider, the costs of the services would more tha[n] likely increase. The cost of administration would certainly increase.

M A N D A T E

From

DISTRICT COURT OF APPEAL OF FLORIDA FIRST DISTRICT

To the Honorable, Stephen F. Dean, Hearing Officer

Division of Administrative Hearings WHEREAS, in that certain cause filed in this Court styled:

JACK BRADLEY, JERRY BALESTER, THOMAS ENGLEBERT, DONALD H. WOELTJEN, D.C. and FLORIDA CHIROPRACTIC ASSOCIATION, INC.

Case No. 92-3643

vs. Your Case No. 92-3319RP

DEPARTMENT OF LABOR AND EMPLOYMENT SECURITY, DIVISION OF WORKERS' COMPENSATION and FLORIDA PHYSICAL THERAPY ASSOCIATION, INC.

The attached opinion was rendered on May 3, 1994,

YOU ARE HEREBY COMMANDED that further proceedings he had in accordance with said opinion, the rules of this Court and the laws of the State of Florida.

WITNESS the Honorable E. Earle Zehmer

Chief Judge of the District Court of Appeal of Florida, First District and the Seal of said court at Tallahassee, the Capitol, on this 19th day of May, 1994.

Clerk, District Court of Appeal of Florida, First District

M A N D A T E

From

DISTRICT COURT OF APPEAL OF FLORIDA FIRST DISTRICT

To the Honorable, Stephen F. Dean, Hearing Officer

Division of Administrative Hearings WHEREAS, in that certain cause filed in this Court styled:

JACK BRADLEY, JERRY BALESTER, THOMAS ENGLEBERT, DONALD H. WOELTJEN, D.C. and FLORIDA CHIROPRACTIC ASSOCIATION, INC.

Case No. 92-3705

vs. Your Case No. 92-3319RP

DEPARTMENT OF LABOR AND EMPLOYMENT SECURITY, DIVISION OF WORKERS' COMPENSATION and FLORIDA PHYSICAL THERAPY ASSOCIATION, INC.

The attached opinion was rendered on May 3, 1994,

YOU ARE HEREBY COMMANDED that further proceedings he had in accordance with said opinion, the rules of this Court and the laws of the State of Florida.

WITNESS the Honorable E. Earle Zehmer

Chief Judge of the District Court of Appeal of Florida, First District and the Seal of said court at Tallahassee, the Capitol, on this 19th day of May, 1994.

Clerk, District Court of Appeal of Florida, First District

Docket for Case No: 92-003319RP

Orders for Case No: 92-003319RP