Author: WorkCompAcademy

The Division of Workers’ Compensation has suspended five more medical providers from participating in California’s workers’ compensation system, bringing the total number of suspended providers to 32.

DWC Acting Administrative Director George Parisotto issued Orders of Suspension against the following providers:

1) Leovigildo Sayat, a physical therapist in Lompoc who in October 2015 pled guilty in US District Court for the Central District of California as a co-conspirator in a $15 million scheme to defraud Medicare by billing for physical therapy services never provided.

2) Alexander Kiev Martinez, a durable medical equipment provider in El Centro, who in April 2016 pled guilty in San Diego Superior Court for referring patients in a bribery scheme involving $25 million in improper claims for medical services and devices billed to California workers’ compensation insurance companies.

3) Robert Gogatz, a chiropractor in Murrieta who last May pled guilty in Riverside Superior Court to 16 counts of insurance fraud.

4) Robert Alva Rose, a physician in Irvine who pled guilty in Orange County Superior Court on September 15, 2015 to two misdemeanors related to his qualifications as a medical provider.

5) Paul Barkal, a physician in San Diego who surrendered his license to the Medical Board of California on October 17, 2005.

AB 1244 (Gray and Daly) requires the DWC Administrative Director to suspend any medical provider, physician or practitioner from participating in the workers’ compensation system in cases in which one or more of the following is true:

– The provider has been convicted of a felony or misdemeanor involving fraud or abuse of the Medi-Cal or Medicare programs or the workers’ compensation system, fraud or abuse of a patient, or related types of misconduct;
– The provider has been suspended due to fraud or abuse from the Medicare or Medicaid (including Medi-Cal) programs; or
– The provider’s license or certificate to provide health care has been surrendered or revoked.

The Department of Industrial Relation’s (DIR’s) fraud prevention efforts are posted online, including frequently updated lists for physicians, practitioners and providers who have been issued notices of suspension, and those who have been suspended pursuant to Labor Code §139.21(a)(1).

The department recently added a new web page with information on lien consolidations and the Special Adjudication Unit.

The Labor Commissioner’s Office has filed a lawsuit against Calcrete Construction, Inc. seeking $6,300,338 for multiple wage theft violations affecting a group of 249 construction workers and the willful misclassification of 175 workers as independent contractors.

An investigation launched in October 2016 uncovered the Glendale-based company’s failure to pay the workers for overtime hours, allocate pay for sick leave and provide proper wage statements. The lawsuit, filed in Los Angeles Superior Court, also seeks civil damages and penalties.

Beginning in August 2016, Calcrete forced its workers under threat of termination to sign contracts stating they were independent contractors. The company then used staffing agencies Dominion Staffing and Southeast Personnel Leasing to pay the workers. “It is illegal for employers to use subcontractors to distance themselves from the obligation to pay workers, and we will use every tool to dissuade employers from this scheme,” said Labor Commissioner Julie A. Su. “This lawsuit aims to recover the money these misclassified workers should have been paid after years of wage theft.”

The suit alleges that Calcrete employees typically worked 10-12 hours Monday through Friday and eight hours on Saturday. They were paid only their regular hourly rate and not for the 18-28 hours of overtime they regularly worked. This underpayment occurred for a nearly two- year period from 2014-16.

The lawsuit seeks wages and damages of approximately $2,596,438 payable to the workers and penalties of approximately $3,703,900 payable to the state.

The Carpenters / Contractors Cooperation Committee, a union-affiliated, non-profit organization that advocates for workplace compliance within the construction industry, referred the case to the Labor Commissioner’s Office.

When a worker is misclassified as an independent contractor, they are not protected by minimum wage, overtime and retaliation laws. The worker is not guaranteed workers’ compensation coverage if injured on the job and has no right to paid rest and meal breaks or sick leave.

Many factors go into determining if a worker is misclassified, including a review of who decides what tasks the worker does, who dictates how tasks should be done and who controls customer relations. Worker misclassification results in an estimated loss of $7 billion each year in payroll tax revenue to the state.

When workers are paid less than minimum wage, they are entitled to liquidated damages that equal the amount of underpaid wages plus interest. Waiting time penalties are imposed when the employer fails to provide workers their final paycheck after separation. This penalty is calculated by taking the employee’s daily rate of pay and multiplying it by the number of days the employee was not paid, up to a maximum of 30 days.

Firefighters have higher than average cancer rates, and while their exposure to carcinogens during fires is well known, a new study suggests exposures in fire stations contribute to their excess cancer risk, too.

“Firefighters spend large portions of their shift waiting for calls in a station, during which they can be exposed to diesel exhaust from idling trucks (which is a known carcinogen) and off-gassing from contaminated post-fire gear (which may be contaminated with a variety of known and/or possible carcinogens),” researchers point out in the Journal of Occupational and Environmental Medicine.

Several studies in recent years have found that firefighters have elevated risks for cancers of the lungs, skin, esophagus, brain, kidney and prostate.

“We know about the chemicals, heat and stress in the field, but what’s left out is the chronic low-level exposure at the fire station during day-to-day business,” lead study author Dr. Emily Sparer of Harvard’s Dana-Farber Cancer Institute in Boston told Reuters Health by phone.

The Reuters report says that the Boston Fire Department approached Sparer’s team with concerns about firefighters becoming sick at young ages. Although department staff knew that diesel exhaust, dust and ash caused sinus and breathing issues, they weren’t sure when and where the most exposure occurred.

Sparer and colleagues sampled air particles at four Boston fire stations in spring 2016, looking for particulate matter less than 2.5 millimeters in diameter. These small particles are considered dangerous to human health because they can be inhaled and become lodged in the lungs. They also looked for particle-bound polycyclic aromatic hydrocarbons, which are chemicals released from burning coal, oil, gas, trash and wood.

They took air samples from the kitchen, truck bay, and outside the station – and conducted interviews with officers at each station to understand health and safety-related policies and practices, such as engine idle-time and washing of contaminated clothing. Particulate matter was present in higher concentrations in the truck bay than in either the kitchen or the outdoors, but levels varied throughout the day.

Newer building materials and effective separation between the different building zones helped keep levels low in the firefighters’ living areas, the study authors found. Policies for ventilating truck exhaust outside and the washing of bunker gear after a fire also had large influences on air quality.

Sparer and colleagues hope to sample air in additional stations and at different times of the year. They’re also talking to officers at the Boston stations about simple steps they can take to reduce risks, such as removing gym equipment from the truck bay, installing commercial-grade washing machines for gear, and closing doors to living areas, when possible.

A limitation of the study is the small size, which makes it difficult to assess whether the exposure numbers are exceptional, said Eero Pukkala of the University of Tampere in Helsinki, Finland. Pukkala, who wasn’t involved with this study, has studied cancer among firefighters in Finland, Norway, Denmark, Iceland and Sweden. Comparison with other indoor locations, such as other workplaces, would be helpful as well to understand the numbers and the severity that firefighters face, he told Reuters Health by email.

The WCIRB Governing Committee voted to authorize the WCIRB to submit a January 1, 2018 Advisory Pure Premium Rate Filing to the California Insurance Commissioner.

The Filing will propose advisory pure premium rates that average $2.01 per $100 of payroll, which is 14.3% less than the industry average filed pure premium rate of $2.34 as of July 1, 2017, and 0.5% more than the average approved July 1, 2017 advisory pure premium rate of $2.00. This modest proposed increase follows five consecutive advisory pure premium rate decreases since early 2015 that have totaled more than 27%.

In his presentation to the Governing Committee, WCIRB EVP and Chief Actuary Dave Bellusci noted that the indicated January 1, 2018 average advisory pure premium rate, while slightly above the average approved July 1, 2017 pure premium rate, is more than 7% below the average January 1, 2017 advisory pure premium rate. Mr. Bellusci identified some of the factors contributing to this reduction over the last year:

– Medical losses have continued to develop downward
– Claim settlement rates have continued to accelerate
– Increasing loss adjustment expense trends have moderated
– Increased wage growth is being forecast

Mr. Bellusci also noted that countering these favorable trends and contributing to this modest proposed increase from the average approved July 1, 2017 advisory pure premium rates are recently rising average claim severities and continued sharp growth in the volume of cumulative injuries.

The WCIRB will submit its January 1, 2018 Pure Premium Rate Filing to the California Department of Insurance (CDI) on or around August 18, 2017.

The CDI will schedule a public hearing to consider the Filing and once the Notice of Proposed Action and Notice of Public Hearing is issued, the WCIRB will post a copy in the Filings and Plans section of the WCIRB website.

A California woman is suing CVS, the largest pharmacy chain in America, for allegedly charging more to customers who use insurance to pay for certain generic prescriptions. The lawsuit seeks class-action status.

NBC News reports that the lawsuit, filed on Monday, accuses CVS Health Corporation of participating in a “fraudulent scheme” and claims the plaintiff, Megan Schultz, paid $165.68 for a prescription in July that, had she bought without using insurance, would have only cost $92.

“CVS never told her that paying in cash would allow her to pay 45% less for the drug; instead, CVS remained silent and took her money – knowing full well that no reasonable consumer would make such a choice,” the complaint says.

The problem, it alleges, is with co-pays sent back to pharmacy benefit managers, or PBMs – the intermediary between insurance companies and pharmacies who negotiate the prices that insurance companies have to pay the pharmacies. PBMs control which pharmacies are in-network for the insurers, incentivizing CVS to offer them a portion of their sales so they can get more clients.

But consumers picking up prescriptions at their neighborhood CVS are blind to that. The agreements between CVS and the PBMs are based on confidential contracts, meaning the “consumer pays the amount negotiated between the PBM and CVS even if that amount exceeds the price of the drug without insurance,” the suit says.

As a result, it continues, CVS can overcharge unknowing costumers by collecting co-pays that exceed the pharmacists’ price and then remit the excess payment back to the PBMs in what’s known as “clawback” payments.

CVS denied the allegations, responding in a statement that they “are built on a false premise and are completely without merit.”

The pharmacy chain said.”Co-pays for prescription medications are determined by a patient’s prescription coverage plan, not by the pharmacy. Pharmacies collect the co-pays that are set by the coverage plans. Our pharmacists work hard to help patients obtain the lowest out-of-pocket cost available for their prescriptions. Also, our PBM CVS Caremark does not engage in the practice of co-pay clawbacks. CVS has not overcharged patients for prescription co-pays, and we will vigorously defend against these baseless allegations.”

David Balto, a former policy director of the Federal Trade Commission who is now an antitrust lawyer, called the alleged conduct by CVS “egregious” and told NBC News that PBMs are in dire need of federal regulation. “No market is as thinly regulated as PBMs, and they’re increasingly taking advantage of it,” he said. “I think it’s crystal clear: Letting tthese entities live in a Wild West regulatory environment just leads to higher costs for consumers.”

But the particular problem of clawbacks has only recently gotten attention, mostly at the state level. Last month, Connecticut Gov. Dan Malloy signed a bill to stop the practice.

The complaint says a least 16 other lawsuits have been filed against various drugstore chains accused of engaging in clawback practices.