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Penalty and Interest Due

When late payment remitted by a claims administrator fails to include penalty and accrued interest, we strongly recommend that you file an Audit Complaint. Doing so could improve California workers’ comp billing for the entire community.

Frequently Asked Questions

Q: How can I tell that penalty and interest is due?

A: If a claims administrator remits untimely payment (within 60 days of receipt of a med-legal bill), they incur a 10% penalty and 7% accrued interest per annum.

Q: What’s an Audit Complaint?

A: Audit Complaints are designed to alert the DWC to non-compliant behavior on the part of a claims administrator. Using your Audit Complaints, the DWC can intervene and correct a claims administrator’s improper bill processes.

Q: Will a claims administrator know if I file an Audit Complaint against them?

A: Not if you don’t want them to. The DWC allows you to file Audit Complaints confidentially, so reporting improper behavior poses no risk to your relationship with the claims administrator.

Reason for Audit Complaint

Use this section to help fill out the DWC Audit Referral form.

Bill Type:

Medical-Legal

Submission Type:

Original Bill

Complaint Category:

Penalty & Interest Due

Complaint Reason:

Failure to pay 10% penalty and accrued 7% per annum interest with untimely payment.

Additional Complaint Information - Non-electronic Submission (Fax):

Claims administrator failed to remit payment for Medical-Legal expense within 60 days of receipt of bill. Late payment did not include penalty and accrued interest. The Bill History includes date Original Bill fax transmission was confirmed received by claims administrator and payment Compliance Dates. See Regulations and Rules cited below.

Additional Complaint Information - Electronic Submission:

Claims administrator failed to remit payment for Medical-Legal expense within 60 days of receipt of bill. Late payment did not include penalty and accrued interest. The Bill History documents the claims administrator returned an accepted acknowledgement verifying the date of receipt of the electronic transmission and payment Compliance Dates. See Regulations and Rules cited below.

How to file an Audit Complaint

When a claims administrator incorrectly denies your Original Bill you should:

  1. Contact Claims Administrator (Optional)
  • Inform claims administrator that your Original Bill was complete and compliant, and included the required supporting documents.
  • Explain to the claims administrator that you have verifiable proof the claims administrator received the Original Bill with supporting documents.
  1. File Audit Complaint
  • Create Audit Complaint:

    DaisyBillers
  1. From Bill History, choose Penalty and Interest Due: Failure to pay accrued penalty and interest with untimely payment.
  2. Additional Complaint Information noted above automatically populates the DWC Audit Referral Form.


Non DaisyBillers: Link to DWC’s Audit Referral Form (link to Form Directions).

  1. Additional Comments: Provide details of conversations and emails with claims administrator, if any.
  2. Additional Audit Complaint Document(s): Provide explanation of review (EOR) received from claims administrator as documenting untimely payment. It is not necessary to include the bill or medical reports.
  1. Submit a request for Second Review
  • Within 90 days of receipt of the original EOR file a request for Second Review to dispute the incorrect reimbursement.

Regulations and Rules

Per the Division of Workers’ Comp Billing and Payment Guide if the non-electronic bill or a portion of the bill is contested, denied, or considered incomplete, the claims administrator shall so notify the health care provider, health care facility or billing agent/assignee in the explanation of review. The explanation of review must be issued within 30 days of receipt of the bill and must provide notification of the items being contested, the reason for contesting those items and the remedies open to the health care provider, health care facility or billing agent/assignee.

Per Labor Code 4622, any properly documented list of services provided and not paid within 60 days after receipt of the original med-legal bill shall be paid at the rates then in effect and increased by 10%, together with interest at the rate of 7% per annum.

The penalty and interest are self-executing and shall apply to the portion of the bill that is neither timely paid nor objected to.

Additional Information

California Labor Code § 4622

Division of Workers’ Compensation Medical Billing and Payment Guide

DaisyBill Resources

Blog Post: Audit Complaints – Making Things Right in Workers’ Comp

Webinar: Audit Complaints for Workers’ Compensation

DaisyBill Solution

With DaisyBill’s Revenue Cycle Management technology, it takes about 5 seconds to file an Audit Complaint.

REQUEST DEMO

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DaisyBill is a trusted authority on workers’ comp billing. Thousands of work comp professionals attend our webinars and state agencies and professional organizations turn to us for our expertise. We created this blog to help everyone involved in workers’ compensation; sharing news, tips, and data of interest to the community.

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