Author: WorkCompAcademy

Pursuant to Labor Code section 5307.1(g)(2), the Administrative Director of the Division of Workers’ Compensation ordered that the Durable Medical Equipment, Prosthetics, Orthotics, Supplies portion of the Official Medical Fee Schedule contained in title 8, California Code of Regulations, section 9789.60, is adjusted to conform to changes to the Medicare payment system that were adopted by the Centers for Medicare & Medicaid Services for calendar year 2017.

The update includes changes identified in Center for Medicare and Medicaid Services Change Request (CR) number 9854.

Effective for services rendered on or after January 1, 2017, the maximum reasonable fees for Durable Medical Equipment, Prosthetics, Orthotics, Supplies shall not exceed 120% of the applicable California fees set forth in the Medicare calendar year 2017 “Durable Medical Equipment, Prosthetics/Orthotics, and Supplies (DMEPOS) Fee Schedule” revised for January 2017, contained in the electronic file “DME17-A (Updated 12/07/16) [ZIP, 2MB]”

For the services on or after January 1, 2017 payment shall not exceed 120% of the fee set forth for the HCPCS code in the CA (NR) column, except the fee shall not exceed 120% of the fee set forth in the CA (R) column if the injured worker’s residence zip code appears on the DMERuralZip_Q12017_V11142017 file. Where column CA (NR) sets forth a fee for a code, but CA (R) for the code is listed as “0.00” the fee shall not exceed 120% of the CA (NR) fee, regardless of whether the injured worker’s address zip code is rural or non-rural.

The order adopting the adjustment can be found on the DWC website.

An investigation into what is being billed as one of the largest workers’ compensation insurance fraud schemes uncovered in the county’of San Diego’s history has swept up medical professionals throughout Southern California and now consequences for Fermin Iglesias, one of the involved cappers.

According to prosecutors, a group of recruiters would entice workers – many of them seasonal workers who lived abroad at times – to file workers’ compensation claims. The alleged recruiters were identified as Fermin Iglesias and Carlos Arguello, who operated Providence Scheduling, Medex Solutions, Prime Holdings International and Meridian Rehab Care, and administrator Miguel Morales.

They would allegedly advertise in the U.S. and Central America via flyers or cards stuck on windshields to contact a call center if a worker has been injured on the job and needs help filing a claim, said Assistant U.S. Attorney Alana Robinson.

The recruiters would then allegedly refer the patients to specific doctors in Southern California, who would in turn prescribe certain medical tests and treatment – such as chiropractic, MRIs, pain management, echo cardiograms and even sleep studies – to companies in return for kickbacks, she said. The bribes were usually $50 to $100 per patient, court records show. The bribes were done without the patients’ knowledge.

The treatment was then billed to various insurance companies, including Liberty Mutual and Hartford.

Chiropractors would be required to fill a monthly quota of referrals or their patient pipeline and bribes would be cut off, authorities said. In one instance, San Diego chiropractor Steven Rigler was warned that he’d fallen $60,000 behind in referrals for procedures and he’d be cut out of the operation unless he wrote the organization a $20,000 to $30,000 check, according to the latest federal indictment.

Rigler has already pleaded guilty, as well as San Diego workers’ compensation attorney Sean O’Keefe.

One of the clinics implicated is Crosby Square Chiropractic, where Rigler worked, which has offices in San Diego, Escondido and Calexico, prosecutors said. Other medical professionals indicted are chiropractors Amir Khan of Orange and David C. Nguyen of Huntington Beach, and pain management Dr. Phong H. Tran of Irvine. Dr. Ronald Grusd of Los Angeles, who was charged federally last year, and was also included in a new state indictment.

And according to the Deferred Prosecution Agreement filed on December 8 in federal court, Fermin Iglesias admitted the allegations of the indictment against him, that he recruited and/or facilitated the recruitment of Workers’ Compensation applicants for legal and medical services .He controlled and operated multiple entities, including, Providence Scheduling Inc., Medex Solutions, Inc., Meridian Medical Resources, Inc., d. b. a. Meridian Rehab Care, and Prime Holdings Int. Inc.

Iglesias further admitted that a “purpose of the conspiracy was to fraudulently obtain money from …insurers by submitting claims for medical goods and services that were secured through an unlawful cross-referral scheme in which defendants supplied patients to doctors and required the doctors to refer those patients to certain providers of ancillary medical goods and services, and the defendants received money from the providers or from health care insurers as part of the scheme, in violation of the doctors’ fiduciary duty to their patients, and concealing from insurers and patients the bribes and kickbacks that rendered the claims unpayable under California law.”

And Iglesias admitted that “It was a part of the conspiracy that Defendants Iglesias, MedEx, Prime Holdings International, Inc., as well as Carlos Arguello and Miguel Morales, received kickbacks and bribes from providers of diagnostic imaging services, including Dr. Ronald Grusd (charged elsewhere) and others” and that “co-conspirator Dr. Grusd and others, concealed from insurers and patients the material fact that referrals were made because of bribes and kickbacks specifically prohibited by California law”.

Iglesias and his coconspirators “further admit that their scheme involved multiple doctors..” and that the “total criminal conduct exceeded $9.5 million in claims to healthcare insurance providers. Iglesias, MedEx, Prime Holdings International, Inc., and Meridian further agree that the gross income derived from this corrupt crossreferral scheme exceeded $5 million.”

Charges against Ronald Grusd M.D. are still pending in federal court, case 15-cr-2821-BAS. The trial date was set for January 24, 2017, but was vacated. According to court records, the “discovery produced by the United States to date consists of multiple gigabytes of data, including reports, emails, medical claim files, audio recordings and video recordings.” The criminal defendants “retained new counsel, who made his first court appearance on October 11, 2016” and needed more time to prepare.

The California Medical Board reports that the Superior Court has issued an order effective March 14, 2016 that Grusd no longer practice medicine pending the outcome of criminal charges in state court pending against him.

AB 1244 will adversely affect the ability of the medical providers who may have filed liens for the collection of fees from recovering additional funds after January 1.

The Division of Workers’ Compensation issued its Notice of Emergency Regulatory Action to implement the provider suspension process required under Assembly Bill 1244.

AB 1244 adds Labor Code section 139.21 which requires the Administrative Director to promptly suspend any physician, practitioner, or provider from participating in the workers’ compensation system if that individual has been convicted of any felony or misdemeanor involving fraud or abuse of the Medi-Cal program, Medicare program, or workers’ compensation system, if that individual’s license, certificate, or approval to provide health care has been surrendered or revoked, or if that individual has been suspended for fraud or abuse from participation in the Medicare or Medicaid programs.

AB 1244 requires the Administrative Director to provide notice of the suspension, which becomes effective after thirty (30) days from the date the written notice is sent, unless the physician, practitioner, or provider stays the suspension by requesting a hearing within ten (10) days from the date the written notice is sent.

AB 1244 mandates the adoption of regulations for suspending a physician, practitioner, or provider from participating in the workers’ compensation system if that individual meets the criteria specified above.

The documentation filed by the DWC in support of their request for emergency regulations claims that “High-profile workers’ compensation fraud prosecutions have revealed that many of these physicians, practitioners, or providers who have been indicted or convicted of fraud are involved in questionable patient care that is harming California’s injured workers. Capping schemes, kickbacks, and illegal patient referrals have resulted in injured workers who have been received unneeded or harmful treatment, been maimed for life, needed additional surgeries to repair incompetent work, and sadly, death of an injured worker’s infant due to failure to provide proper patient care, all driven by these fraudulent schemes rather than their medical needs.”

The emergency regulations will be filed with the state’s Office of Administrative Law (OAL) on December 21, 2016. The regulations to be filed with OAL can be found on the DWC website.

OAL has up to 10 days to consider the rules, but may approve them before the 10 days have elapsed.

Upon OAL approval and filing with the Secretary of State, the regulations are effective for 180 days while the Division initiates formal rulemaking procedures to adopt permanent regulations.

For information on the OAL procedure, and to learn how you may comment on the emergency regulations, go to the OAL’s website.

A notice will be posted at the DWC website when the emergency regulations become effective.

The U.S. Supreme Court on Monday cleared the way for the National Football League’s estimated $1 billion settlement of concussion-related lawsuits with thousands of retired players to take effect, rejecting a challenge brought by a small group of dissenters.

Reuters reports that the eight justices refused to hear an appeal of a lower court ruling in April upholding the settlement, which resolved litigation brought by players who accused the NFL of covering up information that tied head trauma like that suffered playing football to permanent brain damage.

The settlement enables the NFL, the most popular U.S. sports league with billions of dollars in annual revenue, to avoid litigation that could have led to huge sums in damages and provided embarrassing details about how it has dealt with the dangers posed by head trauma in the violent sport.

League officials also have taken steps to outlaw some of the game’s most brutal hits and changed how they deal with players who suffer concussions during games amid growing evidence linking such brain trauma to lasting neurocognitive damage.

The settlement calls for payments of up to $5 million each to former players diagnosed with certain neurological disorders, but it does not address chronic traumatic encephalopathy (CTE), a condition that has been linked to concussions.

Christopher Seeger, a lawyer who helped negotiate the settlement for the retired players, said they will now receive “much-needed care and support for the serious neurocognitive injuries they are facing” under the terms of the settlement.

Brian McCarthy, an NFL spokesman, said the league is “pleased that the Supreme Court has decided not to review the unanimous and well-reasoned decisions” of the lower courts that approved the deal.

The NFL will now work with lawyers for the players and the judge overseeing the settlement to “provide the important benefits that our retired players and their families have been waiting to receive,” McCarthy added.

“This settlement will leave most NFL players on the sidelines, even those most affected by the long-term effects of concussions. Under the terms of the deal, many players diagnosed with CTE will get nothing,” said Deepak Gupta, one of the lawyers representing the dozens of retired players challenging a deal they considered flawed.

In upholding the settlement in April, the 3rd U.S. Circuit Court of Appeals in Philadelphia wrote that those challenging it “risk making the perfect the enemy of the good.” Under the settlement, the NFL does not admit guilt.

A smaller group of retired players objected to the agreement, saying it did not account for CTE. They also argued the deal unfairly favored currently injured retirees and left thousands of former players who have not yet been diagnosed with neurological diseases without a remedy.

The objectors included Scott Gilchrist, the son of retired player Carlton Chester “Cookie” Gilchrist, a Buffalo Bills running back in the 1960s whose lawyers say died from CTE at age 75 in 2011.

The WCAB has issued a number of panel level decisions since SB 863 eroding the jurisdiction of the UR and IMR process for technical mistakes that were claimed to have “invalidated” the process. These cases favored handing the issue of appropriate medical treatment over to the WCJ to decide. As a result UR/IMR seemed to be subjected to a slow death by a thousand such cuts.

However, the trend of erosion of UR/IMR jurisdiction may have suffered a setback at the hands of a June 2016 Court of Appeal published decision that has now been followed in at least one subsequent panel decision.

In the precedent setting case, Dorothy Margaris appealed the IMR determination to the appeals board. She argued argued that the IMR determination was invalid because Maximus failed to issue it within the 30-day time period . The judge agreed the IMR determination was issued 13 days late, but nevertheless found the determination was valid and binding on the parties, concluding that an untimely IMR determination “does not confer jurisdiction on the [workers’ compensation judge] to decide any medical treatment issues.”

A majority of the three-member panel agreed with applicant and went on to find, contrary to the IMR determination, that the proposed treatment was supported by substantial medical evidence and was consistent with the treatment schedule promulgated by the director. One member of the panel dissented, and would have found that the IMR determination, though untimely, was valid and binding on the parties.

But the Court of Appeal intervened, disagreed with the WCAB and reversed in the published case of California Highway Patrol and SCIF v WCAB (Margaris).

The Court of Appeal ruled that the 30-day time limit in section 4610.6, subdivision (d), is directory and, accordingly, an untimely IMR determination is valid and binding upon the parties as the final determination of the director. The Court of Appeal interpretation of the statute in this manner is consistent with long-standing case law regarding the mandatory-directory dichotomy, and implements the Legislature’s stated policy that decisions regarding the necessity and appropriateness of medical treatment should be made by doctors, not judges.

Shortly after Magaris was decided, the WCAB reviewed the case of Christopher Tyni v City of Montebello. Tyni sustained industrial injury to his right knee while employed by the City as a Police Officer.

He sought reconsideration of the Findings And Order of the WCJ, who found that the Independent Medical Review (IMR) in this case was “untimely,” but that the untimely IMR determination “does not confer jurisdiction on the WCJ to decide any medical treatment issues.”

The panel affirmed that the “WCAB has no authority to determine the treatment dispute because the time periods for completion of IMR contained in Labor Code section 4610.6(d) are directory not mandatory, and the IMR determination in this case is valid and binding upon applicant even though it issued outside the time described in the statute.1 (California Highway Patrol v. Workers’ Comp. Appeals Board (Margaris) (June 22, 2016, No. B269038) _Cal.App.4th_ [2016 Cal. App. LEXIS 491] (Margaris).”