Cascade Physical Therapy v. Hartford Casualty Ins.

OAR 436-009-0040(1) sets a maximum for fees paid for medical services of injured workers, and is not intended to prevent parties from agreeing on a lower rate than would normally be paid under the fee schedule.

Cascade Physical Therapy (Cascade) appealed a final order of the director of Department of Consumer and Business Services (DCBS). Cascade had a contract with a PPO, which stipulated that clients of the PPO would pay a reduced fee for medical services. Insurer was a client of the PPO. After providing medical services to insurer, Cascade billed at its usual rate for workers’ compensation claims. Insurer paid Cascade a lessor amount as stipulated by the PPO and provider contract. DCBS concluded that insurer properly paid the discounted amount. Cascade appealed. Cascade asserted that DCBS erroneously interpreted OAR 436-009-0040(1) when it found that insurer may apply a private fee discount contract to the amount billed. The Court noted that it must defer to DCBS’s plausible interpretation of its rule. The rule sets an upper limit on how much a medical provider may charge for services to injured workers, but does not prevent parties from agreeing to a lower rate than is normally charged. The Court held that DCBS’s interpretation of the rule is plausible, and is therefore a valid interpretation of the rule. Affirmed.