Newsletter – Updates for the New Year

Dec 30, 2015

Under AB 1197, Section 2025.220 of the Code of Civil Procedure has been amended to require that for notices of deposition issued on or after 1/1/2016, we are required to state within the notice: (a) whether our client “the noticing party” has a contract with a deposition officer or entity furnishing the deposition officer or (b) whether our client has directed our firm to use a particular deposition officer or entity. This change does not impact the law firm’s ability to select a deposition officer or court reporting entity. It only relates to the client.

Please note this new change requires disclosure only and not the details of any actual contract or agreement.

Now, if an applicant’s attorney somehow wants to object, the CCP requires a written objection no later than three days prior to the date of the deposition, otherwise it is waived. But, any objection made must be based upon good grounds. Frivolous objections may be subject to sanctions, attorney fees and cost, per Lab C 5813, 5811 and 8 CCR 10561, so we don’t expect much activity with this.

We have now changed our notices to conform to this new requirement.

Please remember that effective 1/1/2016, the mileage rate for medical and medical-legal expenses is 54.0 per mile. This will apply regardless of the date of injury.i

On 11/24/2015, a plea agreement was filed in the U.S. District Court for the Central District, Southern Division, under which Philip A. Sobol agreed to plead guilty to a two count information; Conspiracy in violation of U.S.C. Sec 371 and Interstate Travel in Aid of a Racketeering Enterprise in violation of 18 U.S.C. Sec. 1952.

In one of our recent cases involving a lien with Dr. Sobol, his representative had contended that the conduct at issue under the plea agreement relates solely to surgeries performed at Pacific Hospital of Long Beach and does not therefore relate to any other type of medical procedure or procedures at any other place. Upon that basis, they contend that the conduct at issue under the plea agreement had nothing to do
with the medical care otherwise provided to Dr. Sobol’s patients. They further allege under the plea agreement, he did not render substandard care or care which was not medically necessary. And, based upon this logic, they contend any opinions expressed by Dr. Sobol, whether for treatment or medical-legal purposes, is not subject to being challenged based on the plea agreement.

With all due respect, we disagree. The plea agreement actually covers acts which go beyond the referral of patients to Pacific Hospital of Long Beach and these are detailed both in that agreement as well as in the Information, which is part of the agreement. Page 7 of the Information details that in 2005, Dr. Sobol entered into a “claims purchase agreement,” under which a mini-pharmacy was set up in Dr. Sobol’s office and that Sobol Orthopedic was paid $70,000 per month to purchase all insurance claims for medications dispensed through the pharmacy. IPM paid Sobol Orthopedic from 2005 until 2011. The option agreement terminated in 1/2011 and then the purchase agreement was amended. Through 3/2013, Sobol continued to conceal the referral agreement.ii

Labor Code 139.3 requires a treating physician to make disclosures of financial interest. To the extent that there has not been any disclosure of this agreement to set up a “mini-pharmacy,” it is our view that this is a potential non-compliance with the statute and therefore forms a potential legal basis upon which to contest his reports and billings, whether for treatment or medical-legal purposes. The view taken by his collection representatives is both narrow inasmuch as the conduct goes beyond referrals of patients to PCH.

At the very least, his plea agreement creates a good faith issue of a potential non-compliance with Labor Code 139.3, if there has been no disclosure about the “mini pharmacy.” The question is over what period and that is uncertain. But, it would certainly apply to the period of 2011 at least through 3/2013.

We would recommend that careful consideration be given to any bill or lien from Dr. Sobol, with these items in mind.

iDIA-DWC Newsline 12/18/2015; IRS Bulletin IR-2015-137 dated 12/17/2015.
iiInformation filed by U.S. Attorney with United Stated District Court 7:1-17

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