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Retired Workers’ Compensation Judge Samuel L. Sosna Jr. Dies of Cancer

Retired Workers’ Compensation Judge Samuel L. Sosna, Jr. passed last week after a long battle with cancer.

Hon. Samuel L. Sosna, Jr. was retired as a Workers’ Compensation Administrative Law Judge in the Van Nuys District Office of the California Division of Workers’ Compensation. His retirement was announced in April, 2009. He was the past Presiding Judge of the Pasadena District Office from 1990 to 1996. He was well liked and well respected during his tenure as an attorney and as a Worker’s Compensation Judge.

He received his undergraduate degree from Stanford University and his law degree from the University of California Los Angeles. He was admitted to the California Bar on January 14, 1959.

There has not been any public announcement of funeral arrangements.

Feds Reclassify Hydrocodone Combination Products to Schedule II Narcotic

The U. S. Drug Enforcement Administration (DEA) published in the Federal Register the new Final Rule moving hydrocodone combination products (HCPs) from Schedule III to the more-restrictive Schedule II, as recommended by the Assistant Secretary for Health of the U.S. Department of Health and Human Services (HHS) and as supported by the DEA’s own evaluation of relevant data. The Federal Register has made the Final Rule available for preview on its website today at http://go.usa.gov/mc8d. This Final Rule imposes the regulatory controls and sanctions applicable to Schedule II substances on those who handle or propose to handle HCPs. It goes into effect in 45 days.

The Controlled Substances Act (CSA) places substances with accepted medical uses into one of four schedules, with the substances with the highest potential for harm and abuse being placed in Schedule II, and substances with progressively less potential for harm and abuse being placed in Schedules III through V. (Schedule I is reserved for those controlled substances with no currently accepted medical use and lack of accepted safety for use.) HCPs are drugs that contain both hydrocodone, which by itself is a Schedule II drug, and specified amounts of other substances, such as acetaminophen or aspirin.

“Almost seven million Americans abuse controlled-substance prescription medications, including opioid painkillers, resulting in more deaths from prescription drug overdoses than auto accidents,” said DEA Administrator Michele Leonhart, “Today’s action recognizes that these products are some of the most addictive and potentially dangerous prescription medications available.”

When Congress passed the CSA in 1970, it placed HCPs in Schedule III even though it had placed hydrocodone itself in Schedule II. The current analysis of HCPs by HHS and the DEA shows they have a high potential for abuse, and abuse may lead to severe psychological or physical dependence. Adding nonnarcotic substances like acetaminophen to hydrocodone does not diminish its abuse potential. The many findings by the DEA and HHS and the data that support these findings are presented in detail in the Final Rule on the website. Data and surveys from multiple federal and non-federal agencies show the extent of abuse of HCPs. For example, Monitoring the Future surveys of 8th, 10th, and 12th graders from 2002 to 2011 found that twice as many high school seniors used Vicodin®, an HCP, nonmedically as used OxyContin®, a Schedule II substance, which is more tightly controlled.

In general, substances placed under the control of the CSA since it was passed by Congress in 1970 are scheduled or rescheduled by the DEA, as required by the CSA and its implementing regulations, found in Title 21 of the Code of Federal Regulations. Scheduling or rescheduling of a substance can be initiated by the DEA, by the HHS Assistant Secretary of Health, or on the petition of any interested party. (Detailed information on the scheduling and rescheduling process can be found beginning on page 8 of Drugs of Abuse on the DEA’s website at http://www.justice.gov/dea/pr/multimedia-library/publications/drug_of_abuse.pdf.)

The rescheduling of HCPs was initiated by a petition from a physician in 1999. The DEA submitted a request to HHS for a scientific and medical evaluation of HCPs and a scheduling recommendation. In 2013, the U. S. Food and Drug Administration held a public Advisory Committee meeting on the matter, and the committee voted to recommend rescheduling HCPs from Schedule III to Schedule II by a vote of 19 to 10. Consistent with the outcome of that vote, in December of 2013 HHS sent such a recommendation to the DEA. Two months later, on February 27, the DEA informed Americans of its intent to move HCPs from Schedule III to Schedule II by publishing a Notice of Proposed Rulemaking in the Federal Register, outlining its rationale and the proposed changes in detail and soliciting public comments on the proposal, of which almost 600 were received. A small majority of the commenters supported the proposed change.

Granite Installer Faces 30 Years For Double Dipping

An employee for a building remodeling company was scheduled to be arraigned for allegedly cashing in $24,000 in disability checks after telling doctors he could not work–and then working somewhere else installing granite and earning $54,000.

OCWeeky reports that Angel Monzon, 51, of Santa Ana, was charged with 24 felony counts of insurance fraud, seven felony counts of perjury under oath, and four felony counts of making fraudulent statements. Held on $39,000 bail heading into the hearing, Monzon could get up to 30 years in state prison with a conviction, according to the Orange County District Attorney’s office (OCDA).

Monzon lost his balance while working for Fermol Inc. in Huntington Beach on April 19, 2010, when he dropped a large piece of granite that landed on his right thigh and knee and broke. He was placed on temporary total disability and received more than $24,000 in TTD benefits, reporting to doctors that he was unable to work as a result of the injuries he suffered and has limited physical abilities, prosecutors say.

But Monzon actually kept working as a granite installer on a new job–while illegally continuing to accept disability benefits, according to the OCDA. .He is accused of making matters worse for himself on Jan. 30, 2013, when he allegedly lied in a deposition. According to prosecutors, Monzon claimed under oath to: not have worked since the date of the injury; only earn income from TTD benefits; have not worked since April 11, 2012; not have performed any activities involving granite since the date of the injury; not to have loaded or unloaded any granite since the date of the injury; to not have lifted anything over 5 pounds since the date of the injury; and not using a grinder, sander or buffer since the date of the injury.

But a California Department of Insurance investigation produced video evidence of Monzon “working on manual labor projects similar to those performed prior to his injury,” the OCDA say. Arrested by sheriff’s deputies, Monzon allegedly earned more than $54,000 from a new business while illegally receiving and cashing disability checks.

Court of Appeal Rejects Worker’s Fraudulent Concealment Case

Jeff Sinclair worked for Praxair Inc. collecting and testing soil, water, and air samples from potentially contaminated sites. During his employment, he underwent annual physical examinations. Several of his annual physical examinations after 1993 showed he had high blood urea nitrogen and creatinine levels and the examiner noted he should follow up with his own physician. Although Sinclair received copies of all of his annual examination results, he never reviewed them and, therefore, never complied with the recommendation to follow up with his personal physician. Nonetheless, his personal physician diagnosed him with renal disease in 1994 and he admittedly knew of the diagnosis at least since 1996. At the time, his physician attributed his renal disease to gout.

In 2009, after another annual examination, he was diagnosed with stage IV renal failure and became disabled from work. A worker’s compensation qualified medical examiner determined 85 percent of the cause of his renal disease was from work-related chemical exposures.

The Sinclairs subsequently sued Praxair for intentional conduct violating public policy, intentional infliction of emotional distress, and loss of consortium. Their complaint principally alleged Praxair intentionally concealed that workplace chemical exposures both caused and aggravated Sinclair’s renal disease. Praxair moved for summary judgment, arguing the Sinclairs could not establish their claims fell within the fraudulent concealment exception to the workers’ compensation exclusivity doctrine because, among other reasons, Sinclair knew he had renal disease. The superior court agreed and granted summary judgment to Praxair.

The Court of Appeal affirmed in the unpublished case of Sinclair v Praxair Inc.

An employee injured during the course of employment is generally limited to remedies available under the Workers’ Compensation Act. Labor Code section 3602(b)(2) provides a narrow exception to this exclusivity rule and allows a civil suit ‘[w]here the employee’s injury is aggravated by the employer’s fraudulent concealment of the existence of the injury and its connection with the employment, in which case the employer’s liability shall be limited to those damages proximately caused by the aggravation . . . .’ This provision was enacted in 1982 and codifies the common law fraudulent concealment exception that was enunciated by the Supreme Court in Johns-Manville Products Corp. v. Superior Court (1980) 27 Cal.3d 465.

Three conditions are necessary for the fraudulent concealment exception to apply: (1) the employer must have concealed the existence of the injury; (2) the employer must have concealed the connection between the injury and the employment; and (3) the injury must have been aggravated following the concealment. If any one of these conditions is lacking, the exception does not apply and the employer is entitled to judgment in its favor.

Here, the undisputed evidence shows Sinclair was diagnosed with renal disease in 1994 and he knew of the diagnosis as early as 1996. Consequently, the Sinclairs cannot establish the first element of the fraudulent concealment exception, that Praxair concealed the existence of his injury from him.

NHL Concussion Suits Consolidated in Minnesota Federal Court

NBC Sports reports that three lawsuits filed by retired NHL players over concussion-related injuries have been consolidated and will be heard by a federal judge in Minnesota. A special panel assigned the cases Tuesday to U.S. District Judge Susan Richard Nelson of St. Paul. The order says Minnesota provides a central location for parties and witnesses, including those from Canada. It consolidates lawsuits filed by more than 200 former players in Minnesota, New York and Washington. It notes that Nelson is already presiding over one of the cases. The order says two similar cases pending in Minnesota and New York may be added later.

The lawsuits are similar to those on behalf of ex-NFL players, which resulted in an $870 million settlement. The NCAA agreed to a $70 million settlement in another concussion lawsuit.

The NHL has been hit with five different concussion lawsuits since November of 2013, when the first group of 10 ex-players filed in a federal court in Washington. The second was filed in April – one that included former NHLers Dan LaCouture, Dan Keczmer and Mike Peluso, but one that also lost credibility by claiming NHL legend Gordie Howe died in 2009 from a neurodegenerative disease called Pick’s disease.

The third suit was also filed in April, in Minneapolis, by retired players Dave Christian, Reed Larson and William Bennett. Lawsuits No. 4 and No. 5 were filed this past summer and featured former Former Bruins d-man Jon Rohloff, ex-Columbus forward Dan Fritsche and former Ranger Chris Ferraro.

The consolidation order says all five suits may eventually be joined into one.

CHSWC Study Confirms Higher Comp Costs in Southern California Region

The Commission on Health and Safety and Workers’ Compensation (CHSWC) has released on its website the 214 page study, “Examination of the California Public Sector Self-Insured Workers’ Compensation Program” for public comment. This study was part of Senate Bill (SB) 863 Reforms, required by Labor Code Section 3702.4, to examine the public sector self-insured workers’ compensation program and to make recommendations to improve the administration and performance of the program. CHSWC contracted with Bickmore to assist with this requirement.

Recent municipal bankruptcies have drawn attention to public entity employers and the adequacy of the resources they possess to meet their workers’ compensation obligations. It is unclear what the impact to employees and taxpayers would be in the event that large or multiple public entities become unable to provide for their workers’ compensation liabilities.The purpose of this study is to identify variances in the performance of public employers’ self insured workers’ compensation and to recommend areas for improvement. In addition, the study is to provide information that facilitates benchmarking public self-insured workers’ compensation programs.

The study found that a self-insurer’s region has a significant impact on the claims costs. Self-insurers in southern California have experienced higher claim frequency, higher average claim size, and higher overall cost per $100 of payroll. Over the past several years this disparity between southern California and the rest of the State has increased. In addition, claims of southern California self-insurers tend to stay open longer in comparison to those in the rest of the State. The analysis of insurance company data by the California Workers’ Compensation Insurance Rating Bureau (WCIRB) has also pointed to disparities between claim frequencies and costs between different regions of the State. The current analysis confirms that these disparities also exist for public self-insurers. Since one of the goals of the workers’ compensation system to have equal treatment of and benefits for injured workers, the authors believe it is worth exploring the root causes of this disparity.

The type of agency has a major impact on the loss rates, claims sizes, and claims frequencies. Municipalities tend to have the highest costs, whereas educational entities (schools, colleges, and universities) have the lowest. Over the past several years the cost of municipal claims has risen at a faster pace than that of counties or educational entities. This is primarily due to increases in the average claim size. Also, claims of education self-insurers tend to close faster in comparison to those of counties and cities.

In general, JPAs have experienced lower costs per $100 of payroll than individual self-insurers. However, JPA costs have been increasing at a faster rate than those of individual self-insurers over the past several years.

The study found almost no difference in loss rates between self-insurers that utilize a TPA versus those that self-administer. Those that self-administer tend to have a higher claim frequency, but this is offset by a lower average claim size. In addition, loss rates have been increasing at a slower pace for those that self-administer than for those that utilize a TPA.

DWC Sets Public Hearing on Outpatient and ASC Fee Schedule

The Division of Workers’ Compensation has issued a notice of public hearing to revise the recently amended hospital outpatient departments and ambulatory surgical centers (HOPD/ASC) fee schedule. The public hearing has been scheduled for 10 a.m., September 18, in the Auditorium of the Elihu Harris Building, 1515 Clay Street, Oakland, CA 94612. Members of the public may also submit written comment on the regulations until 5 p.m. that day.

As set forth in Labor Code section 5307.1(c)(1), the maximum facility fee for services performed in a hospital outpatient department, shall not exceed 120 percent of the fee paid by Medicare for the same services performed in a hospital outpatient department. Senate Bill 863 also required that for services rendered in ambulatory surgical centers on or after January 1, 2013, the maximum facility fee shall not exceed 80 percent of the fee paid by Medicare for the same services performed in a hospital outpatient department. Effective Jan. 1, 2013, the Acting Administrative Director amended the HOPD/ASC fee schedule (Title 8, California Code of Regulations, sections 9789.30 et seq.), to implement Senate Bill 863 as it relates to the OMFS HOPD/ASC fee schedule. Effective Jan. 1, 2004, the Administrative Director adopted the HOPD/ASC fee schedule (Title 8, California Code of Regulations, sections 9789.30 et seq.), which is updated annually by Administrative Director Order.

The objective of this rulemaking action is to amend the OMFS HOPD/ASC fee schedule to correct the payment methodology for “Other Services” that are paid according to the RBRVS Practice Expense relative value units. The RBRVS conversion factor should be applied in the payment methodology instead of the HOPD/ASC Workers’ Compensation Multiplier that was adopted by the HOPD/ASC fee schedule regulations. Correcting the payment methodology to include the application of the RBRVS conversion factor is beneficial because payment would otherwise be incorrectly calculated.

The notice and text of the regulation can be found on the proposed regulations page.

Broker Creates Fake Insurance Company to Steal Comp Premiums

Jacob Richard Bonzer, 27, formerly of Lake Forest, California was arrested this month in Chicago by the Chicago Police Department and a U.S. Marshals Task Force on 96 felony counts including grand theft, forgery and denial of benefits. If convicted, Bonzer faces a maximum sentence of more than 87 years in state prison. “Bonzer allegedly created more than a thousand insurance policies based on fraudulent information, which allowed him to collect $285,000 in unearned commission payments,” said Insurance Commissioner Dave Jones.

A joint investigation between the California Department of Insurance, the Orange County District Attorney’s Office and the Brea Police Department revealed Bonzer perpetrated several schemes for his personal financial gain.

Investigators discovered that in 2012 Bonzer created a fictitious insurance company called GW Mutual Risk Retention Group, LLC, which was registered in Florida. GW Mutual is not licensed to write insurance in California though Bonzer sold workers’ compensation and commercial insurance policies through his agency, Bonzer Insurance Brokerage, located in Orange County. Bonzer collected approximately $280,000 in premium from 58 California businesses that believed they were purchasing valid coverage. When questioned by a client about GW’s ability to offer insurance in California, Bonzer provided an altered CDI report of examination as proof. Department investigators also discovered premium payments entrusted to Bonzer were used on personal living expenses including the rental of luxury high-rise apartments, travel, wine clubs and fine dining.

“The fact Bonzer’s criminal activity left legitimate businesses without valid workers’ compensation insurance put business owners, their employees and the state at great financial risk. His multiple schemes to rip off insurers and businesses are egregious,” said Commissioner Jones.

Bonzer also submitted 128 fraudulent homeowners insurance applications containing bogus information using nonexistent policyholders for real properties, causing valid policies to be issued for phantom homeowners in escrow between April and July 2010. Bonzer received $46,000 in advanced commissions from the insurance company that expected to collect premiums when the properties closed escrow. Since the applicants were bogus, the insurer never received premium payments and Bonzer was eventually fired. Investigators allege Bonzer continued his scam through another agent after he was fired. It was determined Bonzer created a fictitious mortgage company that referred all residential short-sale business to Bonzer for homeowners insurance. Bonzer used the same scheme leading the insurer to believe they would receive premium payments at the close of escrow. Numerous policies were resubmitted multiple times with an explanation that escrow closing had been delayed. In some cases Bonzer received duplicate commission payments for the same property. Between August 2010 and November 2011, approximately 790 fraudulent homeowners insurance applications, containing bogus information, were submitted by Bonzer under another agent. As a result Bonzer received commission payments of $239,000.

Bonzer orchestrated these elaborate scams by using multiple post office boxes, virtual assistants, business entities, office spaces, email accounts, Website domains and bank accounts. The department has reason to believe that there are additional victims. Anyone who did business with Jacob Bonzer or believe they may be a victim, are encouraged to contact Department of Insurance supervising investigator Vera Grunke at (714) 712-7600.

20% of Orthopedic Patients Doctor Shop for Opiates

“Doctor shopping,” the growing practice of obtaining narcotic prescriptions from multiple providers, has led to measurable increases in drug use among postoperative trauma patients. The study, “Narcotic Use and Postoperative Doctor Shopping in the Orthopaedic Trauma Population,” appearing in the August issue of the Journal of Bone and Joint Surgery(JBJS), links doctor shopping to higher narcotic use among orthopaedic patients. The data was presented earlier this year at the 2014 Annual Meeting of the American Academy of Orthopaedic Surgeons(AAOS).

“There has been an alarming rise in opioid use in our country, and the diversion of opioids for non-therapeutic uses is dramatically increasing,” said lead study author, orthopaedic surgeon Brent J. Morris, MD. “Many suspect that orthopaedic trauma patients may be at a higher risk for pre-injury narcotic use and ‘doctor shopping.'”

Researchers reviewed prescription records for 151 adult patients admitted to an orthopaedic unit at a Level 1 trauma center between January and December 2011. Using the Tennessee Controlled Substance Monitoring Database (CSMD), the study authors reviewed data on narcotic prescriptions obtained three months before, and within six months after, each patient’s orthopaedic procedure. The research found that 20.8 percent of patients sought prescription pain medications from multiple providers. When compared to patients who continued to receive prescriptions and care from a single provider, the “doctor shoppers”:

1) Used narcotics four times longer than single provider patients (112 days versus 28 days).
2) Obtained a median of seven narcotic prescriptions compared to two prescriptions for single provider patients.
3) Had a higher morphine equivalent dose (MED) of narcotics each day (43 milligrams versus 26 milligrams).
4) Were 4.5 times more likely to seek out an additional provider if they had a history of preoperative narcotic use.

The “doctor shopping” patients had an average age of 39.6 ±12.2 years, and were primarily white (89 percent) and male (63 percent). Forty-four percent were uninsured. There were no differences between the single-provider and multiple-provider groups with regard to age, sex, race, injury type, distance between the patient’s home and treating hospital, tobacco use, psychiatric history (depression, anxiety, attention deficit hyperactivity disorder, or bipolar disorder), or comorbidities. “Our study determined that one out of five of our orthopaedic trauma patients obtained narcotic prescriptions from another provider after surgery while still receiving narcotic prescriptions from the treating surgeon,” said Dr. Morris.

The negative consequences of narcotic use and diversion of narcotics for nonmedical use in the United States are growing at dramatic rates Americans consume 80% of the global opioid supply and 99% of the global hydrocodone supply. The alarming rise in unintentional overdose deaths in the United States, which increased 124% from 1999 to 2007, is largely due to increases in prescription narcotic overdoses. Up to 20% of prescription drug abusers receive their narcotic supply from a single physician prescriber, while a growing percentage obtains narcotic prescriptions by seeking multiple providers (“doctor shopping”).

DWC Proposes Modifications to MTUS Regulations

The Division of Workers’ Compensation has posted a first 15-day notice of modification to the proposed Medical Treatment Utilization Schedule (MTUS) regulations to the DWC website. Members of the public are invited to present written comments regarding the proposed modifications to dwcrules@dir.ca.gov until 5 p.m. on August 30.

The MTUS is established as the standard for the provision of medical care in the workers’ compensation system in accordance with Labor Code section 4600. The proposed amendments to the MTUS clarify the scientific process by which evidence-based clinical decisions are to be made when the MTUS is silent on a particular issue and describe how the MTUS may be rebutted pursuant to Labor Code section 4604.5.

The proposed regulations detail the methods to evaluate medical evidence according to an explicit, systematic, strength-of-evidence methodology to determine recommendations that are supported with the best available evidence. The intent of these regulations is to enable workers to achieve appropriate care that is supported by the best available medical evidence. The proposed modifications include:

1) Revision of the definition of “ACOEM” by deleting the reference to the second edition 2004 version and adding a brief description of what the guidelines contain.
2) Revision of the definition of “chronic pain” by adding a three month timeline from the initial onset of pain for clarity.
3) Deletion of the definition of “MEDLINE” because this term is no longer used in the regulations.
4) Modification of the definition of “Appraisal of Guidelines for Research and Evaluation II (AGREE II) Instrument” by adding the May 2009 AGREE II version was adopted and incorporated by reference into the MTUS by the Administrative Director and a copy may be obtained from DWC’s website or by written request to DWC’s Medical Unit.
5) Re-organization and re-wording to express that medical care shall be in accordance with the best available medical evidence when the MTUS’s presumption of evidence is challenged pursuant to Labor Code section 4604.5 or when there is a topical gap and a medical treatment or diagnostic test is not addressed by the recommended guidelines set forth in the MTUS.
6) Clarification that treating physicians may apply the medical literature search sequence, and specifies when Utilization Review physicians and Independent Medical Review physicians shall apply the medical literature search sequence to find the best available medical evidence.
7) Specifies when and by whom the MTUS Hierarchy of Evidence for Different Clinical Questions shall be applied and how the levels of evidence shall be documented in a Utilization Review decision and in an Independent Medical Review decision.

There was a public hearing on this regulations in July. The transcript reflects the testimony of seven individuals who had comments about the MTUS regulatory proposals. Ken Eichler, an official with the Official Disability Guidelines (ODG) was in “full support” of these guidelines. He was however concerned about who was required to rank the evidence. Steve Cattolica, a spokesman for medical providers had similar concerns.

The notice and text of the regulations can be found on the proposed regulations page.