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Unveiling the Misapplication of Regulation 36.7: A Case Against the County of Los Angeles

At Meraki RCM Solutions, LLC, we are dedicated to supporting healthcare providers in the workers' compensation system, particularly those serving as Qualified Medical Evaluators (QMEs). Our expertise in medical billing ensures that our clients navigate complex regulatory landscapes and receive due reimbursement. A recent issue involving Sedgwick CMS and the County of Los Angeles highlights the critical need for correct application of billing regulations, specifically regarding Regulation 36.7 and the mandatory acceptance of electronic billing.

The Incident

Our client, a QME, submitted a Med-Legal bill electronically to Sedgwick CMS, only to have it denied by Medata. The stated reasons for the denial included: "the charge for the procedure exceeds the amount indicated in the fee schedule; the provider's charges were reviewed with consideration of Medata's UR/Pre-Authorization decision(s) governing this claimant, and the listed allowance reflects the results of the decision(s); and service is denied based on California regulation 36.7 Med-Legal bills cannot be submitted electronically." This denial is not only incorrect but also violates established billing requirements.

Clarifying Regulation 36.7

Regulation 36.7 of the California Code of Regulations, Title 8, allows for the electronic service of Medical-Legal reports. The regulation specifies that :

  1. Electronic Service Permitted : Medical-Legal reports and required documents can be served electronically if both parties agree and confirm this in writing.
  2. Service Completion : Service is considered complete upon transmission, with response periods extended by two business days to accommodate electronic delivery ( ( (

Mandates for Electronic Billing

Beyond Regulation 36.7, California Labor Code Section 4603.2 mandates that all claims administrators must accept electronic bills, including Med-Legal bills. This law underscores that electronic submission is not only permissible but required, ensuring efficient and timely processing of claims (Findlaw) (California Public Law).

The Reality of Electronic Billing

Thousands of Med-Legal bills are successfully submitted and processed electronically each year. Denying these bills based on a purported prohibition of electronic submission is a clear misinterpretation of the regulations. The misapplication by Sedgwick CMS and Medata directly contradicts the mandatory acceptance of electronic billing under California Labor Code Section 4603.2.

The Impact of Incorrect Denials

Incorrect denials have significant repercussions:

  • Financial Strain on Providers : Delayed payments cause financial instability and administrative burdens for medical providers.
  • Administrative Burden : Providers must spend additional time and resources to appeal unjust denials.
  • Patient Care Delays : Such denials can delay necessary care and evaluations for injured workers.

Our Expert Response

At Meraki RCM Solutions, LLC, we are committed to addressing and rectifying these challenges. Our approach includes:

  • Appealing Denials : We compile comprehensive documentation to appeal incorrect denials, emphasizing the correct legal requirements and the widespread practice of electronic billing.
  • Educating Providers : We keep our clients informed about regulatory updates and best practices for billing and documentation.
  • Advocacy : We advocate for fair billing practices and work with regulatory bodies to ensure that regulations are applied correctly and fairly.


The denial of our client's electronic submission by Sedgwick CMS under the guise of Regulation 36.7 is a clear misinterpretation that contradicts both the specific provisions of the regulation and the broader mandates of California Labor Code Section 4603.2. As experts in medical billing for workers' compensation, Meraki RCM Solutions, LLC, is dedicated to ensuring that our clients receive the reimbursement they are entitled to and that regulations are correctly applied.

For more insights and assistance with your medical billing needs, contact Meraki RCM Solutions, LLC. We are here to support you in achieving efficient, fair, and compliant billing practices.

Contact: Meraki RCM Solutions, LLC
Phone: +1(562)375-0472

Tag: workers-compensation , PPO Discounts, Preferred Provider Organization, Cost-effective

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