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Workers’ Compensation Daily News for October 29th, 2020

  • WCAB Reinstates 5 Rules in 2 New En Banc Decisions
    on October 28, 2020 at 10:47 AM

    The Workers' Compensation Appeals Board issued two En Banc decisions reinstating a few of the Rules of Practice and Procedure that had been suspended earlier this year as a result of limitations caused by the COVID-19 pandemic.

    The first case was Workers’ Compensation Appeals Board State of California In Re: Covid-19 State Of Emergency En Banc - No. 5 - Case No. Misc. No. 264.

    The relevant section of the Opinion provided that "The Appeals Board hereby rescinds its suspension of WCAB Rules 10755, 10756 and 10888 effective as of the date of this decision. Suspension of the other Rules as outlined in the March 18, 2020 In Re: COVID-19 State of Emergency En Banc (Misc. No. 260) remains in effect until further notice."

    These three rules pertain to sanctions available to the WCJ for failure to appear and scheduled hearings. The rules that are now renstated can be reviewed using the links below.

    -- § 10755. Failure to Appear at Mandatory Settlement Conference in Case in Chief.
    -- § 10756. Failure to Appear at Trial in Case in Chief.
    -- § 10888. Dismissal of Lien Claims.

    The second case was Workers’ Compensation Appeals Board State of California In Re: Covid-19 State Of Emergency En Banc - No. 6 - Case No. Misc. No. 265.

    The relevant section of the Opinion provided that "The Appeals Board hereby rescinds its suspension of WCAB Rules 10620 and 10670(b)(3) as of December 1, 2020. These Rules will become effective again with respect to all workers’ compensation matters on December 1, 2020. Therefore, WCAB Rules 10620 and 10670(b)(3) apply to all trials on or after December 1, 2020."

    These two rules pertain to requirements for filing and service is proposed exhibits for trial. The rules that will be reinstated on December 1 can be reviewed using the links below.

    -- § 10620. Filing Proposed Exhibits.
    -- § 10670. Documentary Evidence.

    Other than these five rules, all other Emergency Orders of prior En Banc decisions remain in effect.

  • DWC Adds 11 New Telehealth Codes Into OMFS
    on October 28, 2020 at 10:47 AM

    The Centers for Medicare & Medicaid Services added 11 codes to the list of telehealth services payable under the Medicare Physician Fee Schedule (MPFS). Coverage which are retroactive to March 1, 2020, and is effective for the duration of the public health emergency (PHE) for COVID-19.

    Alex Azar has once again renewed the public health emergency (PHE) for the coronavirus pandemic (COVID-19). Set to expire Oct. 23, the PHE is now set to expire Jan. 21, 2021 - one year after declaring a PHE for COVID-19 in the United States.

    As a result, the Division of Workers’ Compensation (DWC) has posted an order dated October 20, 2020 adjusting the Physician and Non-Physician Practitioner Services section of the Official Medical Fee Schedule (OMFS) to conform to additional Medicare fee schedule changes pursuant to Labor Code section 5307.1.

    DWC has adopted the updated telehealth list which includes 11 new codes which are effective for services rendered on or after October 14, 2020.

    The order adopting the updated Physician and Non-Physician Practitioner fee schedule can be found on the DWC fee schedule web page.

    The following are the new telehealth codes added by this order:

    -- 93797 Physician or other qualified health care professional services for outpatient cardiac rehabilitation; without continuous ECG monitoring (per session)
    -- 93798 with continuous ECG monitoring (per session)
    -- 93750 Interrogation of ventricular assist device (VAD), in person, with physician or other qualified health care professional analysis of device parameters (eg, drivelines, alarms, power surges), review of device function (eg, flow and volume status, septum status, recovery), with programming, if performed, and report
    -- 95970 Electronic analysis of implanted neurostimulator pulse generator/transmitter (eg, contact group[s], interleaving, amplitude, pulse width, frequency [Hz], on/off cycling, burst, magnet mode, dose lockout, patient selectable parameters, responsive neurostimulation, detection algorithms, closed loop parameters, and passive parameters) by physician or other qualified health care professional; with brain, cranial nerve, spinal cord, peripheral nerve, or sacral nerve, neurostimulator pulse generator/transmitter, without programming
    -- 95971 with simple spinal cord or peripheral nerve (eg, sacral nerve) neurostimulator pulse generator/transmitter programming by physician or other qualified health care professional
    -- 95972 with complex spinal cord or peripheral nerve (eg, sacral nerve) neurostimulator pulse generator/transmitter programming by physician or other qualified health care professional
    -- 95983 with brain neurostimulator pulse generator/transmitter programming, first 15 minutes face-to-face time with physician or other qualified health care professional
    -- 95984 with brain neurostimulator pulse generator/transmitter programming, each additional 15 minutes face-to-face time with physician or other qualified health care professional (List separately in addition to code for primary procedure)
    -- G0422 Intensive cardiac rehabilitation; with or without continuous ECG monitoring with exercise, per session
    -- G0423 with or without continuous ECG monitoring; without exercise, per session
    -- G0424 Pulmonary rehabilitation, including exercise (includes monitoring), one hour, per session, up to two sessions per day

  • San Diego Internist Convicted for Illegal Opioid Prescribing
    on October 27, 2020 at 10:22 AM

    75 year old Egisto Salerno, M.D., an internal medicine physician practicing in San Diego, was sentenced to 18 months in custody for causing the illegal distribution of an opioid pain medication commonly known as Norco or Vicodin.

    He is a 1976 graduate of the National University of La Plata Faculty of Medicine in Argentina, and licensed in California on January 4, 1982. He surrendered his California medical license on May 25, 2018 and is no longer licensed to practice medicine in California. He stipulated to surrender his license to resolve disciplinary actions then pending against him for gross negligence.

    Salerno, whose medical practice was located at 5532 El Cajon Boulevard, pleaded guilty in January, admitting that he signed prescriptions for 78,544 pills that lacked a legitimate medical purpose and were outside the usual course of professional medical practice.

    Salerno also admitted that an undercover federal agent who visited Salerno’s office on six occasions received six hydrocodone prescriptions.

    In a separate instance, on a date when the undercover agent did not visit Salerno’s office and the doctor did not see him, Salerno acknowleged that a prescription was improperly issued by him in the name used by the undercover agent. After the prescription was issued, Salerno ginned up and signed a progress note in the "patient" chart for the purported visit that did not occur.

    The prescription was then picked up by another as part of a larger scheme to divert these pills. That scheme involved two medical assistants in Salerno’s practice who falsified medical records and sold prescriptions that Salerno had pre-signed to a co-defendant though the "patients" identified on those prescriptions did not even see Salerno.

    In fact, as Salerno acknowledged, many of those in whose names these prescriptions were written were deceased or jailed at the time the prescriptions were written.

    The pills were, in turn, diverted to the "capper" or patient recruiter, who also arranged to bring homeless and other individuals to Salerno’s office and paid them to secure these prescriptions from Salerno. Others assisted the patient recruiter by transporting the purported patients to Salerno’s office and then to pharmacies to pick up the pills. In turn, pills were sold in San Diego and delivered to a pharmacy in Mexico for cash.

    As the plea documents show, the criminal activity occurred between November 2014 and February 2018. Seven other defendants have been convicted in this case including Salerno’s two medical assistants - April J. Cervantes and David D. Apple; the lead patient "recruiter" - Stephen Toney; and Toney’s associates - Shalina D. Latson, Lonnell Ligon, LaJuan D. Smith and Amber N. Grabau.

    Defendant David D. Apple, one of Salerno’s medical assistants, will be sentenced on December 2, 2020.

  • Is Agili-C the Future of Joint Repair?
    on October 27, 2020 at 10:22 AM

    CartiHeal, developer of Agili-C, a proprietary implant for the treatment of cartilage lesions in arthritic and non-arthritic joints, announced that FDA has granted Breakthrough Device Designation for the Agili-C implant.

    FDA's Breakthrough Device Program is reserved for certain medical devices that provide for more effective treatment or diagnosis of life-threatening or irreversibly debilitating diseases or conditions. This program is intended to help patients receive more timely access to these medical devices by expediting their development, assessment and review by FDA.

    Cartilage, the flexible soft tissue that cushions joints - especially in the knee - cannot self-heal once damaged, because it lacks blood vessels.

    The Agili-C surgical implant is a biological scaffold onto which the body’s own stem cells grow and regenerate the damaged bone and cartilage naturally. Gradually, over six to 12 months, the scaffold is replaced with a top layer of hyaline cartilage and a bottom layer of bone identical to the body’s own tissues in a normal joint.

    The CartiHeal Agili-C implant is placed where the natural cartilage has degenerated and is immediately infiltrated with blood, starting a biological chain reaction. The result is regenerated bone and cartilage though migration and adhesion of stem cells. The tissue created by this little implant becomes genetically identical to the body’s own tissue. The clinical evidence of the Agili-C slowly becoming a part of the human anatomy is astounding!

    "We are extremely pleased that FDA granted the Agili-C implant Breakthrough Device Designation," said Nir Altschuler, CartiHeal's Founder & CEO. "We look forward to working closely with FDA to expedite Agili-C's review process, once the final IDE study results will be available, in order to provide a promising treatment for millions of patients who suffer from cartilage defects and currently lack good treatment options."

    CartiHeal, a privately-held medical device company headquartered in Israel and New Jersey, develops proprietary implants for the treatment of cartilage and osteochondral defects in traumatic and osteoarthritic joints.

  • COVID-19 Vaccine Likely by End of Year
    on October 26, 2020 at 11:09 AM

    Public health experts are hoping one or several vaccines for COVID-19 will be ready by 2021. Close to 200 vaccines for the disease are under study, and several candidates have moved to phase III human studies.

    To help speed up development and fund the trials, the U.S. has set up Operation Warp Speed, a partnership with the Department of Health and Human Services, the FDA and other federal agencies. Its goal is to deliver 300 million doses of a safe, effective vaccine by January 2021. These companies are included in the program: AstraZeneca, Janssen (Johnson & Johnson), Moderna, Novavax, Pfizer and Sanofi/GSK.

    British pharmaceutical giant AstraZeneca on Monday said its potential Covid-19 vaccine has produced a similar immune response in older and younger adults. AstraZeneca, which is developing its potential Covid-19 vaccine in collaboration with the University of Oxford, said adverse responses to the vaccine among the elderly were also found to be lower.

    The announcement is likely to boost hopes of a Covid vaccine being developed before the end of the year.

    Pfizer, one of the front-runners in the quest for a COVID-19 vaccine, has more than one vaccine candidate, being developed together with the German company BioNTech. It said its candidate vaccine looks safe, and the company expects to have data soon on how well it protects people against the coronavirus.

    The US Department of Health and Human Services and Department of Defense announced a $1.95 billion agreement with Pfizer to produce 100 million doses of the vaccine. The deal also allows the US government to acquire an additional 500 million doses.

    The start of Moderna's Phase 3 trial of its mRNA-1273 vaccine was announced just last August. It will involve 30,000 adults at 89 clinical research sites around the country. It is the first Phase 3 trial begun under Operation Warp Speed, according to the National Institutes of Health.

    Novavax, a biotechnology company based in Gaithersburg, Maryland, announced the launch of its phase three trial in the United Kingdom on September 24, which will evaluate the vaccine in up to 10,000 people, both with and without underlying conditions. Up to 400 participants will also be vaccinated against the seasonal flu as part of a sub-study that will help determine whether it is safe to give patients both vaccines at the same time.

    On September 23, Johnson & Johnson, based in New Jersey, announced the launch of a phase three ENSEMBLE trial to evaluate the safety of the vaccine - and how well it works - among up to 60,000 adults from a variety of countries. The trial will include "significant representation" from older populations and those with underlying conditions that make them more susceptible to COVID-19.

    On October 12, Johnson & Johnson announced that it has paused these trials for an independent safety review due to an unexplained illness in a participant.

  • Court Sustains Gardena PD Service Officer Fraud Conviction
    on October 26, 2020 at 11:09 AM

    Angelica Reynoso was employed as a service officer by the Gardena Police Department and worked at the city jail. On February 20, 2016, an inmate who had scabies was transferred to another jail. Service Officer BrianLee packaged the inmate’s property but Reynoso may have touched the inmate’s shoes.

    That same day, Reynoso or her former husband purchased 1,049 square feet of flooring from Lumber Liquidators.Over the next few months, Reynoso purchased additional flooring from Lumber Liquidators.

    On February 23, 2016, Reynoso reported to her employer that she had a rash and believed it to be scabies due to the inmate exposure. Reynoso received treatment that day from a medical clinic.

    On March 9, 2016, Reynoso informed her employer that she believed that scabies had infected her children and her residence. The employer sent a professional cleaning crew to Reynoso’s residence. The cleaners found an infestation of bedbugs, but not scabies. The crew steam-cleaned the carpet, but did not advise Reynoso to replace the carpet with new flooring.

    Later Reynoso stated that her physician advised her to replace her flooring, and sent flooring invoices to her employer dated from February to May 2016, amounting to $8,640.22. When asked to provide the physician’s note, Reynoso replied that the replacement recommendation came from the cleaning crew who cleaned her residence.

    A jury convicted Reynoso of workers’ compensation insurance fraud and insurance fraud. The court of appeal sustained the conviction in the unpublished case of People v Reynoso.

    The issue on appeal was the admissibility of her recorded interview taken by Investigator Michael Downs at the police department. Downs died before the criminal trial, and the recording was admitted into evidence without his authentication.

    Recordings are writings as defined by the Evidence Code. To be admissible, a writing must be relevant and authenticated. The Code defines authentication as "the introduction of evidence sufficient to sustain a finding that it is the writing that the proponent of the evidence claims it is."

    The fact conflicting inferences can be drawn regarding authenticity goes to the document’s weight as evidence, not its admissibility.

    The trial court acted within its discretion by deciding that the prosecutor established a prima facie showing of authenticity for the Downs recording.

    The parties stipulated that the voices on the regarding were Downs and Reynoso. The parties also agreed that their respective transcripts of the recording had no material differences. At the beginning and end of the recording, Downs announced the time.From this information, the court could measure the duration of the interview and decide that it was complete.

  • Marsh Reports COVID-19 Claim Costs Less Than Expected
    on October 23, 2020 at 10:34 AM

    Marsh has published an Insight Report on the effects of COVID-19 on the Workers' Compensation industry so far. Here are some of the highlights of its report.

    Some six months after the World Health Organization declared a pandemic, many of the most dire predictions about COVID-19’s impact on workers’ compensation systems have not been realized. Claims of COVID-19 exposure in the workplace have been outpaced by a decline in other types of reported occupational injuries, and the workers’ compensation insurance market remains competitive.

    Industry observers have forecast that workers’ compensation premium volume will drop by as much as 10% to 20% in 2020 and will likely not continue to grow in 2021 as the labor market remains challenging. Despite this negative premium growth and a number of changes to state regulations or directives regarding the compensability of COVID-19 claims, Marsh anticipates the impact to insurer profitability to be less drastic and for the line to normalize fairly quickly.

    The National Council on Compensation Insurance (NCCI), Workers’ Compensation Insurance Rating Bureau of California (WCIRB), and other industry observers have published sizable initial ranges of estimated claims losses from COVID-19. But a large influx of COVID-19 claims have not yet materialized, with limited exceptions in health care. And initial analysis shows that the average severity of COVID-19 claims is lower than expected.

    Telemedicine will play an increasingly important role in workers’ compensation, potentially even after the pandemic subsides and workplaces largely transition to a new normal. Amid the pandemic, employers are reporting a variety of benefits and practical applications for telemedicine, including to facilitate triage and claim intake, initial injury assessments follow-up visits, and injury rehabilitation.

    Prior to the pandemic, employers had expressed interest in telemedicine but had not widely adopted its use in workers’ compensation, in part because laws in some states limited its use. Since COVID-19 emerged as a threat, however, many states have eased restrictions and encouraged employers and claims administrators to use telemedicine, which can offer many benefits to employers and workers, including the ability to avoid crowded waiting rooms and lengthy commutes.

    The explosion of telemedicine in workers’ compensation during the pandemic also mirrors its greater use by primary care physicians and others in group health settings. As employees become more familiar with telemedicine’s benefits during the pandemic, they may expect it to remain a readily available option post-COVID-19 — including as a means for receiving care following workplace injuries.

  • LA Clinic Prescribes and Buys Back Opiates for Black Market
    on October 23, 2020 at 10:34 AM

    A woman was sentenced to 60 months in prison for her leading role in an opioid buy-back scheme in which a doctor at a Los Angeles clinic prescribed opioids to "patients" who sold the narcotics back to the clinic, which later sold drugs on the black market in California and Texas.

    Angela Gillespie-Shelton, a.k.a. "Boss Lady," and "Angotti," 54, of Houston, was sentenced and also ordered to pay a $10,000 fine. She pleaded guilty on May 21 to one count of conspiracy to distribute controlled substances and one count of conspiracy to engage in money laundering.

    From October 2012 to January 2015, Gillespie-Shelton and her co-conspirators ran Southfork Medical Clinic, located in the Harvard Heights neighborhood of Los Angeles. At the time, Gillespie-Shelton primarily was based in Texas, but she frequently traveled to California.

    The conspiracy’s purpose was to sell prescriptions for narcotics in exchange for cash, and to later acquire those same drugs from the clinic’s "patients," ship the narcotics to Texas and then sell them on the black market. The prescriptions were for drugs including oxycodone and hydrocodone (commonly sold under the brand names Vicodin, Norco and Lortab), alprazolam (best known by the brand name Xanax), carisoprodol (a muscle relaxant sold under the brand name Soma) and promethazine with codeine (a cough syrup sold on the street as “purple drank” and “sizzurp”).

    At the clinic, Gillespie-Shelton’s co-conspirator - Dr. Madhu Garg, 69, of Glendora - saw "patients" and regularly prescribed them the narcotics, when both Gillespie-Shelton and Garg knew that the customers did not have any actual or legitimate medical need for them.

    After the "patients" filled the prescriptions, Gillespie-Shelton and her co-conspirators bought the drugs from them and shipped the drugs to Texas.

    In Texas, Gillespie-Shelton used two pharmacies that she controlled as a front to sell on the black market the drugs shipped from the Los Angeles clinic. Under Gillespie-Shelton’s control, the pharmacies in Texas also filled false or fraudulent prescriptions and received kickbacks from the fake prescriptions. Gillespie-Shelton’s co-conspirators also stole a physician’s identity to issue falsified prescriptions to obtain additional narcotics.

    In addition, Gillespie-Shelton laundered more than $1 million from the diversion schemes through numerous accounts. She used some of the money to further the narcotics trafficking conspiracy, which included paying rent for the Southfork Clinic and a stash house in Los Angeles, as well as paying Garg more than $200,000 for writing the illegal prescriptions.

    In February 2016, Garg pleaded guilty to illegally distributing oxycodone and money laundering, and she later served an 18-month prison sentence.

    "[Gillespie-Shelton and her co-conspirators] made hundreds of thousands of dollars profiting off the Opioid Crisis," prosecutors wrote in their sentencing memorandum. "The sheer amount of money [they] made over the course of this conspiracy shows that this was a crime borne of greed where the criminals trafficked lethal drugs despite the undeniable havoc they wreaked on their community."

  • Purdue Pharma Agrees to $5.5B Criminal Fines and Penalties
    on October 22, 2020 at 10:32 AM

    The Department of Justice announced a global resolution of its criminal and civil investigations into the opioid manufacturer Purdue Pharma LP, and a civil resolution of its civil investigation into individual shareholders from the Sackler family. The resolutions with Purdue are subject to the approval of the bankruptcy court.

    Purdue Pharma has agreed to plead guilty in federal court in New Jersey to a three-count felony information charging it with one count of dual-object conspiracy to defraud the United States and to violate the Food, Drug, and Cosmetic Act, and two counts of conspiracy to violate the Federal Anti-Kickback Statute.

    The criminal resolution includes the largest penalties ever levied against a pharmaceutical manufacturer, including a criminal fine of $3.544 billion and an additional $2 billion in criminal forfeiture.

    For the $2 billion forfeiture, the company will pay $225 million on the effective date of the bankruptcy, and, as further explained below, the department is willing to credit the value conferred by the company to State and local governments under the department’s anti-piling on and coordination policy.

    Purdue has also agreed to a civil settlement in the amount of $2.8 billion to resolve its civil liability under the False Claims Act. Separately, the Sackler family has agreed to pay $225 million in damages to resolve its civil False Claims Act liability.

    The resolutions do not include the criminal release of any individuals, including members of the Sackler family, nor are any of the company’s executives or employees receiving civil releases.

    While the global resolution with the company is subject to approval by the bankruptcy court in the Southern District of New York, one important condition in the resolution is that the company would cease to operate in its current form and would instead emerge from bankruptcy as a public benefit company (PBC) owned by a trust or similar entity designed for the benefit of the American public, to function entirely in the public interest.

    As part of the plea, Purdue will admit that it conspired to defraud the United States by impeding the lawful function of the DEA by representing to the DEA that Purdue maintained an effective anti-diversion program when, in fact, Purdue continued to market its opioid products to more than 100 health care providers whom the company had good reason to believe were diverting opioids and by reporting misleading information to the DEA to boost Purdue’s manufacturing quotas.

    In addition, Purdue will admit to conspiring to violate the Federal Anti-Kickback Statute. Purdue made payments to two doctors through Purdue’s doctor speaker program to induce those doctors to write more prescriptions of Purdue’s opioid products. Similarly, from approximately April 2016 through December 2016, Purdue made payments to Practice Fusion Inc., an electronic health records company, in exchange for referring, recommending, and arranging for the ordering of Purdue’s extended release opioid products - OxyContin, Butrans, and Hysingla.

    The DOJ resolution does not resolve claims that states may have against Purdue or members of the Sackler family, nor does it impede the debtors’ ability to recover any fraudulent transfers.

  • CMS Releases New WCMSA Reference Guide (Version 3.2)
    on October 22, 2020 at 10:32 AM

    The Centers for Medicare and Medicaid Services (CMS) has just released its latest version of the WCMSA Reference Guide (Version 3.2, October 5, 2020). This new guide replaces the WCMSA Reference guide version 3.1 (May 11, 2020).

    The new Reference Guide provides a list of major medical centers used by the Workers’ Compensation Review Contractor (WCRC). This list of centers is used to establish pricing associated with medical services such as a surgery, hospital stay, long-term in-patient care, etc. The list of the zip codes is found in Appendix 7 of the Guide and should follow the same process as outlined for selecting the proper jurisdiction for determining pricing.

    CMS also added a new screen to the WCMSA Portal (WCMSAP) on October 5, which requires the submitter to answer the question, "Does the proposed WCMSA for this settlement include any costs associated with a major medical center, Yes or No?" If the answer is yes, then the appropriate zip code for the major medical center that was used in the calculation of the WCMSA needs to be entered into the space provided.

    This enhancement should improve the WCMSA process. In the past, it has not been clear which major medical center the WCRC used to price WCMSAs.

    The new process should reduce the number of counter higher determinations received on WCMSAs. The industry has been asking CMS/WCRC to clarify this issue for some time and Optum is pleased to see that this has been addressed in the WCMSA Reference Guide.

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