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Lawmakers Seek Proof of Vaccination Law to Enter Public Spaces

The Sacramento Bee reports that California lawmakers are considering legislation to require people to prove they’re fully vaccinated against COVID-19 before entering indoor public spaces like restaurants, bars, movie theaters, gyms, hotels and stadiums.

The proposal hasn’t been formally introduced in the Legislature, and the timeline for action is unclear.

Assemblywoman Buffy Wicks, D-Oakland, said the coalition of lawmakers supporting the concept has not decided whether to push the plan immediately before the legislative year’s Sept. 10 deadline or wait until January when lawmakers return to work. The Sacramento Bee obtained a copy of the draft legislation, which Wicks said is also subject to change.

Wicks said she is in conversations with business leaders, union representatives and others whose support is necessary for any legislation to be successful.

“I think everyone right now is honestly and earnestly at the table,” Wicks said.

As currently written, the proposal would take effect immediately upon the governor’s signature, and would direct the Department of Public Health to develop an enforcement mechanism by Nov. 1.

The proposal, first reported by Politico, would create one of the strictest statewide vaccination requirements in the nation.

The state Department of Public Health said last week that it was leading the nation with a requirement that everyone attending an indoor event with 1,000 people or more show proof of vaccination or a negative COVID-19 test. That requirement takes effect Sept. 20.

Wicks said the new verification requirement could help drive up vaccination rates in California and finally end a pandemic that has spread in the state for 18 months. The system could help schools and businesses keep their doors open, Wicks said, and ease overburdened hospitals clogged with COVID-19 patients amid the delta variant surge.

Sutter Health to Pay $575M to Resolve Anticompetitive Claim

A landmark $575 million settlement with Sutter Health has now been given final approval by the court. The settlement agreement was reached in 2019, and resolves allegations by the Attorney General’s office, the United Food and Commercial Workers and Employers Benefit Trust (UEBT), and class action plaintiffs that Sutter’s anticompetitive practices led to higher healthcare costs for consumers in Northern California compared to other places in the state.
Sutter is the largest hospital system in Northern California. The Sutter network consists of some 24 acute care hospitals, 36 ambulatory surgery centers, and 16 cardiac and cancer centers. It also includes some 12,000 physicians and over 53,000 employees. In addition, Sutter negotiates contracts on behalf of the Palo Alto Medical Foundation and many affiliated physician groups.

This settlement is the result of litigation that began in 2014 when UEBT filed a class action lawsuit that challenged Sutter’s practices in rendering services and setting prices. They sought compensation for and an end to what they alleged were unlawful, anticompetitive business practices, which caused them to pay more than necessary for healthcare services and products.

In March 2018, the Attorney General’s office filed a similar lawsuit against Sutter on behalf of the people of California, seeking injunctive relief to compel Sutter to correct its anticompetitive business practices moving forward. The separate lawsuits were combined by the court into one case. In October 2019, one day before the trial, the parties reached an agreement to settle. The settlement was filed with the court on December 19, 2019, and in March, Judge Massullo granted preliminary approval.

Today’s finalized settlement requires Sutter to:

– – Pay $575 million to compensate employers, unions, and others covered under the class action, and to cover costs and fees associated with the legal efforts;
– – Limit what it charges patients for out-of-network services, helping ensure that patients visiting an out-of-network hospital do not face outsized, surprise medical bills;
– – Increase transparency by permitting insurers, employers, and self-funded payers to provide plan members with access to pricing, quality, and cost information, which helps patients make better care decisions;
– – Halt measures that deny patients access to lower-cost plans, thus allowing health insurers, employers, and self-funded payers to offer and direct patients to more affordable health plan options for networks or products;
– – Stop all-or-nothing contracting deals, thus allowing insurers, employers, and self-funded payers to include some but not necessarily all of Sutter’s hospitals, clinics, or other commercial products in their plans’ network.
– – Cease anticompetitive bundling of services and products which forced insurers, employers, and self-funded payers to purchase for their plan offerings more services or products from Sutter than were needed. Sutter must now offer a stand-alone price that must be lower than any bundled package price to give insurers, employers, and self-funded payers more choice;
– – Cooperate with a court-approved compliance monitor to ensure that Sutter is following the terms of the settlement for at least 10 years. The monitor will receive and investigate complaints and may present evidence to the court; and
– – Prevent anticompetitive practices by clearly defining clinical integration to include patient quality of care. The settlement makes clear that for Sutter to claim it has clinically integrated a system, it must meet strict standards beyond regional similarities or the mere sharing of an electronic health record, and must be integrating care in a manner that takes into consideration the quality of care to the patient population. This is important because clinical integration can be used to mask market consolidation efforts by hospital systems, when in fact there is no true integration of a patient’s care. For example, saying that hospitals are regionally close or that hospitals are sharing electronic health records is not enough, there must be close coordination that will lead to less costly, higher quality care for local communities.

A report by the University of California Berkeley showed that over-consolidation drives up prices for consumers. According to the study, outpatient cardiology procedures in Southern California cost nearly $18,000 compared to almost $29,000 in Northern California. For inpatient hospital procedures, the cost in Southern California is nearly $132,000 compared to more than $223,000 in Northern California, a more than $90,000 difference. A 2016 study found that a cesarean delivery in Sacramento, where Sutter is based, costs more than $27,000, nearly double what it costs in Los Angeles or New York, making Northern California one of the most expensive places in the country to have a baby.

COVID Comp Claims Remain Well Managed

As the COVID-19 pandemic goes on, the workers’ compensation industry is still continuing to manage changing claim patterns and trends. As regulations and case rates continue to shift, Mitchell has analyzed its workers’ compensation claims data to identify how claim trends have changed over the past year and a half.  This report includes claim data through June 30, 2021.

From January through June 2021, the finance and insurance, transportation and warehousing and healthcare and social assistance industries reported significantly more workers’ compensation claims than in the first half of 2019.

On the other hand, Mitchell’s data reveals that some industries have not seen prepandemic claim volumes return. The arts, entertainment, and recreation, educational services, and accommodation and food services industries are all still reporting significantly fewer workers’ compensation COVID-19 claims. Though claim volumes are still down, all three of these industries are experiencing an increase in claims compared to 2020 volumes, but are subject to pandemic-related regulations and trends that may explain the lower volume of claims.

About a quarter of workers’ compensation COVID-19 claims include only indemnity costs (no medical costs) – and those costs have declined over time. In January 2021, Mitchell reported that the average indemnity cost (lost wages etc.), for a COVID-19 claim was $2,400 in 2020; now, that number has decreased by almost half to $1380.

On the other hand, average medical costs associated with COVID-19 claims have remained somewhat steady, with just a slight 5% increase since Mitchell’s last report.

According to NCCI, the makeup of claim types is a clear reversal when compared to historical workers’ compensation claim data – prior to the pandemic, about 75% of all workers’ compensation claims were medical-only. NCCI published similar findings to Mitchell’s data, reporting that 75% of COVID-19 claims were lost-time claims.

It comes as no surprise that the healthcare and social assistance industry sector is still the source of the majority of COVID-19-related workers’ compensation claims, accounting for 49% of the total. Similar to Mitchell’s previous reporting, the healthcare industry is still accounting for almost five times more COVID-19-related claims than the next largest source, public administration, which makes up about 10% of all COVID-19 claims.

August 23, 2021 – News Podcast


Rene Thomas Folse, JD, Ph.D. is the host for this edition which reports on the following news stories: Court Applies Borello Standard in Appeal of Criminal Conviction. States Face August 21 Deadline to Accept $26B Opioid Settlement. So. Cal Telemedicine Doctor Arrested for Opioid Prescriptions. S.F. Restaurant Resolves Wage and Tip Theft Case for $1.6M. Neurosurgeon Acquitted in Pacific Hospital Kickback Case. State Audit Shows $72B Covid Funding Mismanagement. New Low Back Guideline Supports Benefits of RTW. CMS Finds Dangerous Patient Care at Good Samaritan Hospital. COVID Comp Claims Spiked to 2,581 Cases in July. Musk Announced “Teslabot” Humanoid Worker by Next Year.

Jury Convicts SoCal PI Lawyer for Stealing $3.9M Settlement

A disbarred personal-injury lawyer was found guilty by a federal jury of 22 felonies for stealing the majority of a multimillion-dollar settlement that should have been paid to a car accident victim, as well as cheating on his federal income taxes.

Philip James Layfield, a.k.a. “Philip Samuel Pesin,” 48, of Las Vegas and formerly of Coto de Caza, was found guilty of 19 counts of wire fraud, one count of mail fraud, one count of tax evasion, one count of failure to collect and pay over payroll taxes, and one misdemeanor charge of failure to file a tax return. Following the jury verdicts, Layfield was remanded into federal custody.

According to evidence presented at his 13-day trial, Layfield owned and operated law firms, including Layfield & Barrett (L&B), which, at various times, maintained offices in Irvine; Los Angeles; El Segundo; Park City, Utah; and Scottsdale, Arizona.

After he had misappropriated millions of dollars from clients’ settlements, Layfield relocated to Costa Rica. Just before getting on a flight to Costa Rica, Layfield borrowed $700,000 from a business lender by providing misleading information and failing to disclose material information. Then he used substantial portions of the loan proceeds for personal expenses, including buying a horse and shipping horses to Costa Rica.

In 2016, Layfield entered into an agreement to represent an individual who was struck by an automobile in Orange County and suffered significant injuries. After negotiating a $3.9 million settlement related to the accident, Layfield misappropriated most of the money owed to the victim – approximately $2 million for personal and business uses, including to pay clients whose settlement proceeds Layfield had earlier misappropriated. The car accident victim received only $25,000 of the settlement proceeds.

Layfield also failed to file a federal income tax return for the tax year 2016, despite receiving more than $3 million, including embezzled client settlement money. Layfield also caused his law firm to not pay approximately $120,976 in payroll taxes to the United States government for the second quarter of 2017.

The State Bar of California disbarred Layfield in October 2018. Layfield also was a certified public accountant, but his CPA license expired in July 2019, according to the California Board of Accountancy.

United States District Judge Michael W. Fitzgerald has scheduled a November 8 sentencing hearing, at which time Layfield will face a statutory maximum sentence of more than 200 years in federal prison.

Homeland Security Investigations, IRS Criminal Investigation and the FBI investigated this matter.

Assistant United States Attorneys Mark R. Aveis and Carolyn S. Small of the Major Frauds Section and Ian V. Yanniello of the International Narcotics, Money Laundering and Racketeering Section are prosecuting this case.

Pharmacy Owner to Serve 3 Years for $1.8M Fraud

A 62 year old Orange County pharmacy owner who admitted to carrying out a $1.8 million insurance fraud scheme was sentenced Friday to three years in state prison.

The Orange County Register reports that Divina Catalasan, owner of Quality Care Pharmacy at 2413 S. Fairview St. in Santa Ana, pleaded guilty in May to three felony counts of fraudulent healthcare claims and grand theft, along with a sentencing enhancement for aggravated white-collar crime.

Catalasan operated a “complex and secretive scheme” that bilked MediCal, Medicare and Cal Optima, the county’s insurance program for the needy, Deputy Attorney General Ryan Scott said in court papers.

The California Department of Health Care Services during a 2015 audit learned that from 2011 through 2015 Catalasan had billed Medi-Cal more than $540,000 above what her purchase inventory actually showed. A deeper look a unit investigating potential fraud ultimately turned up a total of $1.8 million in over-billings through Medi-Cal, CalOptima and Medicare, according the California Attorney General’s Office.

“The funds she stole were deposited and intermingled in her personal and business bank accounts,” investigator Ernesto Cambrone alleged in a court motion seeking to analyze any money the defendant posts for bail to determine if it came from the alleged criminal behavior.

The pharmacy’s clientele consisted of residents of 40 board and care facilities throughout Southern California, according to prosecutors.

After arriving in the United States from her native Philippines in 1987, Catalasan worked her way up from a machine operator at a paper towel factory to become a pharmacy technician, a licensed pharmacist and ultimately a business owner, according to a sentencing brief.

While out of jail awaiting trial, a court filing said, she worked with members of her church to make and donate masks to medical professionals, nursing home patients, grocery store workers and female inmates.

At her sentencing, she was given credit for 602 days of time served in local lockup, records show.

Study Claims Majority of Workers Favor Remote Work

American employees say that the number one workplace feature they’ll be searching for post-COVID is the ability to continue working remotely when they please.

That’s according to a new study reported by StudyFinds.org of 2,000 Americans who are still working from home during the pandemic. More than two in five (48%) say a company’s policy on remote work is now their number one desired workplace perk. It’s so important that nearly three in four (72%) claim they wouldn’t even consider working for a company that didn’t offer flexible work-from-home policies.

Although 36 percent think their job is more difficult when working remotely, 71 percent say they have a better work-life balance when working from home. Employees are happiest with the new flexibility in their schedules (45%) and the ability to take breaks anytime (44%), with the average person taking a break around every two and a half hours.

Over half the poll (51%) feel like their workplace contributions have been acknowledged more since they started working from home.

“People are embracing remote work more than ever before. Workplace norms have shifted and employees are expecting to have a more robust work-life balance,” says Dave Landa, CEO of Kintone, in a statement.

Unfortunately, working from home hasn’t been all rainbows and butterflies for employees. From not having the right office equipment (35%), to having difficulty communicating with coworkers (36%), or having too many distractions (34%), working from home isn’t a flawless system for many.

Employees also say they would like to purchase an internet upgrade (48%), a new computer (40%), or a new desk or workstation (38%) to improve their remote work experience. One in five (22%) expressed dissatisfaction with their company meeting employee needs while working from home.

Americans weren’t shy about suggesting ways their company could help improve their work from home experience. Almost half think adjusted company policies, including working hours and expectations (46%) would make a difference in their performance. Other ways that companies can make working from home better is by reimbursing their employees for internet service or other utility bills (43%) or providing a new computer or laptop (41%).

Communication is key for half of respondents (52%) who feel like their company can benefit from communicating more directly with employees. Almost six in 10 (57%) feel work-related communication was more productive in the office and 36 percent feel it has been a strain to effectively communicate with their leadership about career matters.

Every major transformation like this comes with hurdles and uncertainties. In the end, the benefits of happier, more satisfied employees will justify the efforts to address these challenges head on. Employers should create policies and find solutions to meet these concerns and strengthen communications so that remote and hybrid work experiences will only improve in the post-pandemic era,’ Landa adds.

SuperCare Health Resolves Fraud Claim for $3.31M

The California Attorney General announced a $3.31 million settlement against home respiratory services company, SuperCare Health Inc. for defrauding the state and federal government by knowingly billing Medicare and Medi-Cal for servicing ventilators that were no longer medically necessary.

The proposed settlement resolves allegations that the Downey-based company submitted fraudulent claims to Medi-Cal in violation of the state and federal False Claims Acts.

Under the proposed settlement, SuperCare will pay a total of $3.31 million to multiple government plaintiffs, with California receiving approximately $327,000.

SuperCare sells and rents equipment used in the treatment of breathing-related disorders, such as sleep apnea and chronic obstructive pulmonary disease. One of the machines used to assist patients with breathing is the non-invasive ventilator. The ventilators, either with or without oxygen, deliver pressurized air to patients to assist in the breathing process, particularly during sleep.

A whistleblower alleged that SuperCare, which services patients in Southern California and Nevada, continued to service non-invasive ventilators that were no longer being used by patients, and were not medically necessary, and therefore no longer eligible for Medi-Cal reimbursement. Despite this knowledge, the company billed Medicare and Medi-Cal for servicing the ventilators. The whistleblower filed his case in the United States District Court for the Central District of California.

A subsequent three-year investigation by the California Department of Justice’s Division of Medi-Cal Fraud and Elder Abuse (DMFEA), working with the United States Attorney’s Office for the Central District of California and the Nevada Medicaid Fraud Control Unit, found that claims submitted by SuperCare from May 2013 through October 2019 validated the whistleblower’s claims.

Through the DMFEA, the California Department of Justice works to protect Californians by investigating and prosecuting those who perpetrate fraud on the Medi-Cal program. DMFEA also investigates and prosecutes those responsible for abuse, neglect, and fraud committed against elderly and dependent adults in the state. The Division regularly works with whistleblowers and law enforcement agencies to investigate and prosecute crimes.

The DMFEA receives 75% of its funding from the U.S. Department of Health and Human Services under a grant award totaling $41,264,032 for federal fiscal year 2020-2021. The remaining 25%, totaling $13,754,675 for fiscal year 2020-2021, is funded by the State of California. The federal fiscal year is defined as October 1, 2020, through September 30, 2021.

When is a Roommate a Partial “Dependent” for Death Benefits?

Decedent Tara O’Sullivan, worked as a police officer for the City of Sacramento when she died from a gunshot wound on June 19, 2019.

Krista Horvath and Ms. O’Sullivan were sisters. Just prior to her death, decedent and Ms. Horvath agreed to move in together with Ms. Horvath’s fiancé. This would allow Ms. Horvath to save money for her planned wedding. They had signed a lease before the death, and intended to split the utility bills in half.

The Death Without Dependents Unit primarily argued at trial that Ms. Horvath would merely have been a roommate of decedent and that sharing the bills as part of a family pot is insufficient to establish dependency.

A Findings and Order issued which found that competing applicant, Krista Horvath was a partial dependent of deceased employee Tara O’Sullivan, and dismissed the claim of the Death Without Dependents Unit.

The WCAB panel denied the Death Without Dependents Unit Petition for Reconsideration in the panel decision of Krista Horvath for Tara O’Sullivan (Deceased), Death Without Dependents v. City OF Sacramento, (ADJ12601349)

Dependency is determined as of the time of injury, and may be found to be total or partial, depending on the facts established. Dependency may be defined as reliance upon another person for support. Partial dependents are those who at the time of injury have means of support other than the deceased’s contributions.

To prove partial dependency, it is sufficient to show that the claimants looked to the deceased’s contributions to maintain his or her accustomed mode of living and that the same living standard can no longer be maintained. (Atlantic Ricl1field Co. v. WCAB (Arvisu) (1982) (42 Cal.Comp.Cases 369) The contribution must be made in goods or money, and the value of services is not considered. (Great W. Power Co. v. IAC (Savercool) (1923) 192 Cal. 724.)

Death Without Dependents primarily argued at trial that applicant would merely have been a roommate of decedent and that sharing the bills as part of a family pot is insufficient to establish dependency.

While this is true, the facts establish that decedent intended to take on a greater share of the family pot so that applicant could save for her wedding.

If only applicant and decedent lived together, the splitting of rent and utilities would likely be insufficient to establish dependency as it is a true family pot with equal expenses split.

However, here, three people were to occupy the apartment, not two. Decedent agreed, in effect, to subsidize applicant’s rent and utilities. That agreement is sufficient to establish a partial dependency where the applicant is decedent’s sister.

The petition for reconsideration focuses on the undisputed facts that this was a promise for support prior to decedent s passing and that no actual support occurred prior to death. On this point, the argument proffered by DWD was too narrow.

A mere promise of future support is not, as a rule, a basis for a dependency finding, except where circumstances indicate a bona fide assumption of responsibility for support without opportunity to make contributions prior to the injury.” (Wings West Airlines v. Workers’ Comp. Appeals Bd. (1986) 187 Cal. App. 3d 1047, 1052.)

The significant fact here is that they signed a lease together prior to Ms. O’Sullivan’s death. By signing a lease contract, there was a bona fide assumption of responsibility for support, which occurred prior to death. The only reason that Ms. O’Sullivan did not make payments prior to her death was lack of opportunity.

WCAB Panel Rejects VR Total Disability Citing Hegglin Rule

Brenda Lee sustained an industrial injury on July 21, 2014 to her back, hips and left leg while employed by the Employment Development Department. Her case was resolved on May 14, 2018 by stipulation for 20% permanent disability based upon the rating of 50% (15.03.01.00 – 28 – 39 – 112D – 33 – 40) 20%.

Less than two months later, (July 6 2018), Lee filed a Petition to Reopen and subsequently obtained a vocational evaluation with Frank Diaz who opined that Lee was unable to return to work in the open labor market.

Dr. McGahan served as the panel qualified medical examiner. In his April 19, 2019 report Dr. McGahan found applicant to be TTD as she had recently has a spinal fusion. He re-evaluated applicant on October 30, 2019 and found applicant to be permanent and stationary at the time of evaluation. He opined that applicant continued to have 28% WPI and also found that applicant had a 3% impairment for her right and left hip due to her industrially related bursitis. He specifically mentioned that applicant’s osteoarthritis of the hips was not due to the industrial injury.

The WCJ found that Lee sustained 26% permanent disability based upon the PQME reporting of Dr. McGahan and that the reporting of the vocational evaluator was not substantial evidence to be relied upon.

The WCAB denied her Petition for Reconsideration in the panel decision of Lee v California Employment Development Department.

The issue in this case is whether applicant’s vocational evidence constitutes substantial evidence to support the conclusion that applicant was permanently totally disabled due to her inability to benefit from vocational rehabilitation.

Throughout Dr. McGahan’s reporting, applicant’s work restrictions remained essentially the same. Lee was required to alternate sitting and standing every 10 minutes, no lifting, pushing, or pulling greater than 20 pounds, and a 10-minute break every hour. Dr. McGahan later added a restriction of no repetitive bending and squatting.

Mr. Diaz interpreted this restriction as follows: “Ms. Lee’s need to take ten (10) minute breaks every hour is significantly labor disabling as she would require breaks totaling eighty (80) minutes per day. Ms. Lee’s need to take a ten (10) minute break every hour and potentially leave her work station during these breaks could not be readily accommodated in the open labor market.

However, in his May 24, 2017 report Dr. McGahan explained the restriction as needing to “alternate tasks as well as stretching. I do not believe that Ms. Lee has to clock out and take an off the clock break. It is my professional opinion that through an alternate task with an allowance for stretching, she would be able to accomplish this break while on the clock.”

Mr. Diaz did not review the May 24, 2017 report by Dr. McGahan and was therefore unaware of this important distinction in the restriction.

In Hegglin v. Workmen’s Comp. Appeals Bd. (1971) 4 Cal.3d 162, 169 [36 Cal.Comp.Cases 93, 97 the panel noted that “reports and opinions are not substantial evidence if they are known to be erroneous, or if they are based on facts no longer germane, on inadequate medical histories and examinations, or on incorrect legal theories. Medical opinion also fails to support the Appeals Board’s findings if it is based on surmise, speculation, conjecture or guess.”

Mr. Diaz’s vocational evaluation was not substantial evidence on the issue of permanent disability in part because Mr. Diaz’s reporting was based upon a misinterpretation of applicant’s work restrictions.