Author: WorkCompAcademy

United States Attorney Michael Bailey and Arizona Attorney General Mark Brnovich launched a joint federal, state, and local task force to combat coronavirus-related fraud.

The COVID-19 Fraud Task Force brings together a dozen partners from across the state, with the goal of combining resources and information to better investigate and prosecute wrongdoers that seek to profit from the public health crisis.

Assistant United States Attorney Jim Knapp, recently appointed as the United States Attorney’s Office COVID-19 Fraud Coordinator, and Joseph Sciarrotta, Civil Division Chief for the Attorney General’s Office, are leading the Arizona COVID-19 Fraud Task Force. Other members include: Maricopa County Attorney’s Office, the Federal Bureau of Investigation, the Food and Drug Administration, the Internal Revenue Service Investigation Division, Health and Human Services, the United States Postal Inspection Service, the Treasury Inspector General for Tax Administration, the United States Secret Service, the United States Army Criminal Investigation Division, and the Defense Criminal Investigative Services.

In recent weeks, stories of fraud related to the coronavirus have increased across the nation. In times of uncertainty, consumers are often more vulnerable to scams as they seek answers and a sense of security. Fake texts, emails, and social media posts that might normally be ignored may now be enticing if they offer COVID-19 tests, miracle cures, medical products, or financial windfall.

On April 6, the Federal Trade Commission reported that it had received almost 12,000 consumer complaints related to COVID-19 in just three months. Well over half of those complaints were fraud-related, with a total loss to consumers of $8.39 million.

The Arizona Attorney General’s Office has also experienced a spike in COVID-19-related consumer fraud complaints. The office already sent cease-and-desist letters to local businesses (YiLo Superstore Dispensary and Prepper’s Discount) that were offering COVID-19-related products alleged to be in violation of the Arizona Consumer Fraud Act. To help keep Arizonans informed of the latest scams and to provide tips to consumers, the Attorney General’s Office recently launched a COVID-19 scam information page: www.AZAG.gov/COVID-19.

In light of these reports, consumers are urged to consider the following to protect yourself from COVID-19 fraud:

— Do not respond to texts, emails, or calls requesting your personal information in exchange for a COVID-19 stimulus check. If you receive one of these requests, immediately report it to the hotline. COVID-19 economic impact checks will be delivered based on 2018 or 2019 tax return information, so no action is required for most people.
— Ignore offers for a COVID-19 vaccine, cure, or treatment. Remember, if there is a medical breakthrough, you won’t hear about it for the first time through an email, online ad, or unsolicited sales pitch.
— Research any charities or crowdfunding sites soliciting donations in connection with COVID-19 before giving. An organization may not be legitimate even if it uses words like “CDC” or “government” in its name.
— Be cautious of purchasing personal protective equipment (PPE) from unknown third party vendors. Verify that the company is legitimate before ordering their products or sending money.
— Never click on a link or open an email attachment from an unknown or unverified source. Links and attachments may be embedded with a virus that will infect your computer or mobile device. To better protect yourself against malware, make sure your anti-virus software is operating and up-to-date.
— Do not be convinced by sales pitches for COVID-19 tests that promise to give results in as little as 24 hours. If an effective, quick-results test becomes widely available, you will find out through news sources and government reporting, not a sales pitch.

If you believe you have been a target of a coronavirus-related scam, or know someone else who has been, please report the fraud. Reports can be made to the Task Force at:

National Center for Disaster Fraud Hotline: 1-800-720-5721 or disaster@leo.gov
FBI’s IC3 (for internet related scams): www.IC3.gov

Attorneys representing parties in litigation have not had a clear understanding about possible liability for settling a workers’ compensation or personal injury case without adequately dealing with Medicare issues. However, a new case filed by the United States against a plaintiff lawfirm in Texas may help to clear up any misunderstandings about attorney liability exposure.

Franco Signor reports that a lawsuit filed in in the United States District Court for the Southern District of Texas by the U.S. alleges that the plaintiff attorney in a personal injury action (Carrigan & Anderson, PLLC and Attorney Stephen P. Carrigan individually) failed to reimburse Medicare’s demand for conditional payments in full.

It is not unusual for U.S. Attorneys to file litigation against personal injury law firms for failure to comply with the Medicare Secondary Payer (MSP) act requirement to reimburse conditional payments. The instant case is different.

Here the personal injury attorney Defendants corresponded often with the Benefits Coordination & Recovery Contractor (BCRC) regarding Medicare conditional payments owed on behalf of their Medicare beneficiary client, Tomas R. Tijerina prior to settling the claim. Defendants did not agree with the amount demanded and sought state court protection in an Order that reduced Medicare’s conditional payments rather than undertake the administrative appeals process to dispute the conditional payment amount owed.

As alleged by the U.S. Attorney in the Complaint, on April 14, 2016, Defendants first notified the BCRC about Tijerina’s car accident on April 13, 2014. Additionally, on March 30, 2017, Defendants notified BCRC that Tijerina had settled his lawsuit with the responsible parties for $70,000.00. On April 10, 2017, BCRC sought to recover the Conditional Payments and sent Defendants an Initial Determination demanding reimbursement of $46,244.74 that the Medicare program paid for Tijerina’s medical expenses related to his lawsuit.

On April 19, 2017, Defendants filed a motion with the 278th Judicial District Court in Waller County, Texas, that challenged the Initial Determination by the Medicare program. The Defendants sent BCRC copies of their motion. On July 20, 2017, BCRC renewed its demand on behalf of Medicare for the full amount of $47,343.05, ignoring the State Court ruling.

On August 3, 2017, the Defendants without responding to BCRC’s Initial Determination or Demand Letter, sent BCRC a copy of an order issued by the 278th Judicial District Court in Waller County, Texas, that reduced the recovery of Medicare’s Conditional Payments by 90% to $4,700.00 and a check for $4,700.00. The District Court agreed with the Defendants assertion that the U.S. Supreme Court’s decision in Arkansas Dept. of Health v. Ahlborn applied, and that Medicare or the Centers for Medicare & Medicaid Services (CMS) is only entitled to the portion of the settlement that actually constitutes reimbursement for payments made. However, the District Court seemed to fail to realize the distinction between Medicaid and Medicare’s recovery rights, and that the underlying recovery in the Ahlborn decision pertained to Medicaid, and not Medicare (two distinct programs with distinct third-party recovery rights).

The lawsuit alleges that that to date, Medicare had not received additional payments to reimburse Medicare’s full conditional payment demand, and that the 278th Judicial District Court lacked subject matter jurisdiction to adjudicate a challenge to Medicare’s recovery of conditional payments. Further, the District Court’s order reducing or otherwise limiting Medicare’s recovery is void and unenforceable per the United States’ sovereign immunity. Lastly, the current amount alleged owed by Defendants to Medicare for its Conditional Payments is $53,445.93 ($42,643.05 principal, $10,802.88 interest).

Attorneys at Franco Signor claim that it is likely the U.S. Attorney will prevail in its lawsuit against Defendants and recover not only its full amount owed, plus interest.  Historical case law has clearly established that responsible parties under the Medicare Secondary Payer Act (MSP) cannot avoid exhausting administrative remedies and go straight to Court to adjudicate conditional payment amounts. Further, the District Court’s application of Albhorn, a Medicaid decision to a Medicare claim for reimbursement, will likely be questioned upon further analysis by the Court in this lawsuit. What is surprising is that the U.S. Attorney’s office is seemingly refraining from seeking twice the amount claimed from the plaintiff attorney firm, although it could potentially amend its lawsuit.

The takeaway here is to always address conditional payments before settlement takes place. Disputing unrelated charges to the underlying case is easier before a determination in the form of a Demand is made by Medicare. Allowing plaintiff or their attorney to manage the matter creates exposure for the responsible party to potential claims.

The WCAB just issued its second En Banc decision modifying the rules that apply to litigation management.

WCAB Rule 10940(b) states in relevant part: “No documents sent directly to the Appeals Board by fax or e-mail will be accepted for filing, unless otherwise ordered by the Appeals Board.” (Cal. Code Regs., tit. 8, former § 10845(c), now § 10940(b) (eff. Jan. 1, 2020), emphasis added.) To the extent that WCAB Rule 10940(b) prohibits sending documents directly to the Appeals Board by email, we order that documents may be emailed directly to the Appeals Board. Documents that may be emailed include, but are not limited to, correspondence relating to a petition for reconsideration that has been granted for further study by the Appeals Board.

Documents sent by email should include the information required for pleadings by WCAB Rule 10520 and an email address for the sending party. (Cal. Code Regs., tit. 8, former § 10498, now § 10520 (eff. Jan. 1, 2020).) Documents sent by email should otherwise comply with the WCAB’s Rules. Documents may be sent by email to WCABEmergencyBox@dir.ca.gov and will be responded to per the Appeals Board’s normal operating procedures.

Petitions for reconsideration, removal, or disqualification and answers should still be filed in EAMS or with the district office having venue pursuant to WCAB Rule 10940(a). (See Cal. Code Regs., tit. 8, former § 10840(a), now § 10940(a) (eff. Jan. 1, 2020).)

Administrative Director (AD) Rule 10205.7(c) provides that “No document shall be sent by electronic mail or by fax directly to the district office or the appeals board. If a document is sent by electronic mail or fax directly to the district office, it shall not be accepted for filing or deemed filed, shall not be acknowledged, and may be discarded unless otherwise ordered by the workers’ compensation administrative law judge or the appeals board“. (Cal. Code Regs., tit. 8, § 10205.7(c), emphasis added.)

Although ordinarily prohibited by the AD’s Rules, the Appeals Board hereby orders that specific documents may be by sent by email directly to the district offices. The district offices may accept by email solely documents subject to a statutory time limit where the filing party could not otherwise e-file, JET file or file the document by mail. Information regarding email addresses for filing documents by email with the district offices is available on the DWC’s webpage: https://www.dir.ca.gov/dwc/dir2.htm.

All parties are reminded that ex parte communications are prohibited per WCAB Rule 10410 and any document sent to the district offices or the Appeals Board by email or any other method must also be served on all parties to the matter. (Cal. Code Regs., tit. 8, former § 10324, now § 10410 (eff. Jan. 1, 2020).)

These orders will remain in effect until further notice.

The Division of Workers’ Compensation (DWC) and the Workers’ Compensation Appeals Board (WCAB) has announced an update to the modified calendar and filing procedures announced on March 16, 2020. This update to the procedures continues to prioritize the health and safety of staff and the public to help prevent the spread of COVID-19.

The updated hearing and filing procedures are detailed below:

Hearing Procedures April 6 through April 10

— DWC will continue to hear expedited hearings for parties that appear at the district offices.
— DWC will also hear status conferences, mandatory settlement conferences and priority conferences via CourtCall only. If all parties do not appear via CourtCall, the case will be continued and notice will be given.
— All other hearings will be continued. No trials or lien conferences will be heard during this time.
— Parties are required to adhere to social distancing guidelines when visiting DWC district offices.

Filing Procedures April 6 through April 10

— District offices will remain closed for filing purposes. Accordingly, all filing deadlines are extended to Monday, April 13.
— DWC will not accept walk-through documents, walk-in filings, or in-person requests.
— Parties may utilize the Electronic Adjudication Management System (EAMS) to file documents online. Parties may also mail settlement documents or petitions to the district office where the case is filed.
— Refer to the district office page for e-mail and other contact information.
— Additional information will be posted on the DWC website to assist parties with filing settlement documents in EAMS. Hearing Procedures Effective April 13
— DWC conferences including mandatory settlement conferences, priority conferences, status conferences and all expedited hearings will be heard telephonically.
— All DWC judges in California will hear cases by an individually assigned conference line. These conference lines are available toll-free. A list of all conference line numbers will be posted on DWC’s website prior to the effective date.
— Parties should call the conference line for the judge in front of whom the case is set, at the designated hearing time listed on the hearing notice. When prompted, parties should enter the access code assigned to that line. DWC staff will instruct participants as to the procedure to follow during the call.
— All trials and lien conferences will be continued until further notice. District offices will hold no in-person hearings.

Filing Procedures Effective April 13

— DWC will reopen for filing purposes.
— DWC will only accept filing by e-filing via EAMS, JET file or by mail.
— DWC will not accept walk-in filings, walk-through documents or in-person requests at this time. Injured workers who are unable to file
utilizing these options or need assistance may contact DWC’s call center at 909-383-4522.

Effective Immediately

— Until otherwise notified, DWC will accept an electronic signature on any settlement documents, applications, pleadings, petitions or motions that are sent to the district offices or filed in EAMS. For all e-forms, parties should utilize “S signature” as shown in the E-forms Filing Reference Guide and the JET File Business Rules.

The WCAB Commissioners’ office is closed to the public for in-person inquiries and requests until further notice.