Author: WorkCompAcademy

The decline in opioid use in California workers’ compensation has outpaced the decline among the state’s overall population according to a new California Workers’ Compensation Institute (CWCI) analysis of 2017-2023 opioid prescription data from the California Department of Justice’s Controlled Substance Utilization Review and Evaluation System (CURES) database.

The analysis builds on prior CWCI studies by tracking multiple opioid utilization metrics, noting the percentage change in the number of opioid patients over the study period, changes in the average strength of the daily dose of morphine equivalents (the “morphine equivalent dose” or MED), and the average duration of opioid use for workers’ comp opioid patients. Duration of use and MED level are highly correlated with addiction and harmful side effects of opioids, including overdose and overdose-related death. The study also compares these metrics to opioid treatment guidelines to identify the proportion of patients whose opioid use exceeded guideline recommendations and how these proportions changed over time.

Key findings include:

– – Nearly 22.3 million Californians were prescribed opioids between 2017 and 2023, with workers’ comp patients accounting for 1.1% of that total. The number of Californians who were prescribed opioids each year fell 34% from 6.8 million in 2017 (17.3% of the population) to 4.5 million in 2023 (11.5% of the population), while the number of workers’ comp patients prescribed opioids fell 62% from 91,620 in 2017 to 34,744 in 2023.

– – Breaking the opioid utilization results out by level of patient acuity showed that:

– – – – The number of acute opioid workers’ comp patients (<30 days of opioid use) declined an average of 9.2% per year vs. 4.9% for all acute California opioid patients.

– – – – The number of subacute opioid workers’ comp patients (30-89 days of opioid use) declined an average of 12.6% per year vs. 9.8% for all subacute California opioid patients.

– – – – The number of chronic opioid workers’ comp patients (90 or more days) declined an average of 10.6% per year vs. 6.3% for all chronic California opioid patients.

– – Over the study period the average daily morphine equivalent dose for workers’ comp patients declined across the board, falling 26% for chronic patients, 23.6% for acute patients, and 17.6% for subacute patients. The proportion of new acute workers’ comp patients that exceeded the recommended 50 MED per day threshold fell by 9.9 percentage points and the proportion that was within the 20-50 MED range rose by 13.3 percentage points.

– – The proportion of new acute workers’ comp patients receiving opioid prescriptions that exceeded the recommended 5-day supply decreased by 8.2 percentage points during the study period, with 2/3 of that decrease occurring in 2018, immediately after the state incorporated Pain Management and Opioid Treatment Guidelines into the Medical Treatment Utilization Schedule (MTUS) and implemented the MTUS Formulary.

– – Among chronic workers’ comp patients, the share of total days’ supply with an MED over 50 dropped from 27.1% in 2017 to 21.3% in 2023.

– – During each calendar year in the study period, most workers’ comp chronic opioid patients also received opioid prescriptions from other payer systems, but the percentage of those patients who received opioids from both workers’ compensation and other systems declined from 72.1% in 2017 to 68.7% in 2023.

– – From 2017-2023, the total daily morphine equivalent dose (from all payers) for workers’ compensation patients declined by 17.1 MED. The portion of the MED covered by workers’ comp declined by 8.4 MED or 24.1%, the portion covered by other payers declined by 8.6 MED or 32.6%.

– – A declining share of workers’ compensation opioid patients had prescriptions in which their days’ supply of opioids from other payers overlapped with their workers’ comp prescriptions. The proportion of days’ supply that overlapped multiple systems declined from 8.0% in 2017 to 3.7% in 2023, so it appears that the declines in opioid utilization in workers’ comp did not lead to increased opioid use in other systems.

While opioid use nationwide has declined across different health care systems, the steep decline in California workers’ compensation, which the CWCI study shows exceeded the decline noted for the general population, reflects the success of reforms enacted over the past two decades. These included a mandate that medical care provided to injured workers conform to evidence-based treatment standards; the addition of Chronic Pain and Opioid Guidelines into the MTUS; implementation of the MTUS Formulary; a requirement that opioid dispensers enter prescription and patient information into CURES within one day of dispensing the drug; and a requirement that doctors check CURES before prescribing a controlled substance to a patient for the first time, and at least once every four months when continuing to prescribe the drugs to the patient.

U.S. Attorney Phillip A. Talbert announced that a federal grand jury returned an eight-count indictment against Leonel Hernandez, 51, of Parlier, charging him with mail fraud.

According to court documents, Hernandez was employed as a supervisor for a farm labor contractor in Sanger. Between March 2017 and October 2020,

Hernandez submitted falsified disability insurance claims using identities of individuals known to him, including some who were already deceased and some who were farm laborers in Sanger or Fresno.

Hernandez forged physician signatures on the disability insurance claim forms, falsely certifying that the physicians had examined the claimants and falsely certifying other medical information that was allegedly obtained through such examinations. Hernandez used the U.S. mail to submit at least 20 claims and caused losses exceeding $300,000.

If convicted, Hernandez faces a maximum statutory penalty of 20 years in prison and a $250,000 fine. Any sentence, however, would be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables. The charges are only allegations; the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.

This case is the product of an investigation by the Federal Bureau of Investigation and the California Employment Development Department. Assistant U.S. Attorneys Chan Hee Chu and Joseph Barton are prosecuting the case.

The National Council on Compensation Insurance (NCCI) recently conducted a comprehensive survey of more than 100 workers compensation executives addressing key issues for 2025.The financial health of the workers compensation system, medical inflation, economic uncertainty, and the shifting workplace and workforce continue to be top concerns for industry executives, a recent survey reveals.

“Each year, our Carrier Executive Survey captures the pulse of the industry and helps us pinpoint key issues facing workers compensation stakeholders,” remarked Bill Donnell, President and CEO of NCCI. NNCCI said it is dedicated to staying ahead of emerging trends and equipping stakeholders with data and insights to make informed decisions for the future.

The survey report highlights two key concerns that appear more than any others:

First: Financial Health of the System – Will There Be a Turn?

This and other related questions are common from inquiring stakeholders. All metrics point to a healthy and strong system, as evidenced by nearly a decade of combined ratios below 90%.

Preliminary results for 2024, based on National Association of Insurance Commissioners data through midyear, suggest another strong year with a combined ratio of 90% or below. Improvements in safety and automation have contributed to nearly 20 years of frequency decline in states where NCCI provides ratemaking services.

NCCI expects this trend to continue.

Secondly: Medical Inflation.

“Industry stakeholders consistently name medical inflation as a top concern, and this year, it is more prevalent than ever. Currently, medical inflation and its impact on workers comp is moderate and in the range of 2.5-3.5%. Medical inflation behaves differently in workers compensation compared to the broader economy.

There are two main considerations when evaluating medical inflation and its impact on workers compensation.

– – Fee schedules are a major factor in keeping workers compensation (WC) medical costs in control. These state-mandated cost containment mechanisms put limits on WC payments to healthcare providers and how much those payments can change from one year to the next.
– – Medical inflation in WC is different than medical inflation in the broader economy. Consider the different types of injuries and treatment in WC – the differentiation matters. The categories of treatment are also weighted differently. It’s important to look behind the numbers, as NCCI has identified in the Workers Compensation Weighted Medical Price Index.

NCCI’s annual Carrier Executive Survey is part of its ongoing communication efforts that identify key issues facing workers compensation stakeholders. This year’s survey highlights familiar top concerns and other emerging issues like legalization of medical marijuana, how climate impacts workers, and the evolving regulatory and legal landscape.

For more information, view NCCI’s Focus on Top Industry Concerns. These and other important issues will be addressed at NCCI’s Annual Insights Symposium 2025.

In February 2013, Jose de Jesus Ortiz was admitted to Elmcrest Care Center, LLC, a skilled nursing facility. He suffered from Parkinson’s disease, dysphagia, and dementia; he had a history of falling; and he was on an advanced dysphagia diet.

On August 4, 2017, staff at Elmcrest found the Ortiz on the floor and nonresponsive. They administered CPR and called 911. Paramedics later transported him to a hospital, where he passed away four days later. He was 63 years old.

Plaintiff Ericka Ortiz, as personal representative and administrator of the Estate of Jose de Jesus filed a civil action against Elmcrest and the individual staff members, asserting causes of action for elder abuse and neglect; negligence/willful misconduct; and fraud. The operative pleading alleged that, as result of Respondents’ failure to provide basic and necessary care to the decedent, he suffered a fall from his bed that led to suffocation, deprivation of oxygen to his brain, and respiratory arrest.

The trial court granted Elmcrest’s motion to compel the Estate to arbitrate its claims based on an agreement the decedent executed upon his admission to Elmcrest. On March 30, 2022, after a 15-day arbitration hearing, the arbitrator served the parties with a 90-page document entitled “Interim Award” (the First Interim Award)

The First Interim Award concluded with the arbitrator’s liability determinations on all causes of action and set forth conditions for further proceedings before the award would become final. The Award stated that the Estate “did not sustain her burden of proof as to the first cause of action for Elder Abuse and Neglect, the third cause of action for Negligence/Willful Misconduct[,] and the sixth cause of action for Fraud.” And it provided “This Interim Award will become final twenty days after service unless either side (a) points out in writing an omission to decide a submitted issue or (b) moves for further relief authorized by the law and the parties’ Arbitration Agreement.”

On May 26, 2022, the arbitrator served the parties with “Interim Award No. 2” (the Second Interim Award). The Second Interim Award reaffirmed that the Estate “did not sustain its burden of proof as to the third cause of action for Negligence/ Willful Misconduct” and “did not sustain its burden of proof as to the sixth cause of action for Fraud.” However, as to the “first cause of action for Elder Abuse/Neglect,” the Second Interim Award found the Estate had “sustained its burden

On July 6, 2022, the Estate petitioned the trial court to vacate the First Interim Award. Among other things, the Estate argued the First Interim Award was not final and had been superseded by the Second Interim Award.

On September 7, 2022, the Arbitrator issued a “Final Award,” awarding the Estate $100,000 in damages on the elder abuse claim, $208,035 in attorney fees, and $92,921.77 in costs. Unlike the First Interim Award, this award placed no conditions on finality. It stated: “This Award is binding and is intended to address all issues in dispute even if not expressly discussed herein. The Arbitrator is not empowered to redetermine the merits of any claim already decided. [¶] This Award may be presented to the Court pursuant to CCP §1285 et seq.”

On September 30, 2022, the Arbitrator issued a “Final Award (Corrected),” again awarding $100,000 in damages and $92,921.77 in costs (the Final Award). The Final Award corrected a miscalculation related to the lodestar and multiplier to award the Estate $207,000 in attorney fees.

On December 14, 2022, Elmhurst filed a petition to vacate the Final Award. The same day, the Estate filed a petition to confirm the Final Award. the trial court entered an order (1) denying the Estate’s petition to confirm the Final Award and (2) granting Respondents’ petitions to vacate the Final Award and to confirm the First Interim Award.

On May 2, 2023, the trial court entered its order vacating the Final Award and confirming the First Interim Award. The Estate filed a timely appeal. The Court of Appeal reversed and vacated the order with directions to enter a new order confirming the final arbitration award served on September 30, 2022 in the published case Ortiz v. Elmcrest Care Center, LLC -B330337 (November 2024).

The California Arbitration Act (§§ 1280-1294.4; the Arbitration Act) represents a comprehensive statutory scheme regulating private arbitration in this state. Section 1283.4 specifies the requisite “form and contents” of an arbitration award. The statute provides the “award shall be in writing,” “signed by the arbitrators concurring therein,” and it “shall include a determination of all the questions submitted to the arbitrators the decision of which is necessary in order to determine the controversy.” (§ 1283.4.)

The issuance of an ‘award’ – meeting the requirements of section 1283.4 “is what passes the torch of jurisdiction from the arbitrator to the trial court.” (Lonky v. Patel (2020) 51 Cal.App.5th 831, 843- 844. Thus, it is incumbent on the trial court, before confirming or vacating what has been deemed an award, ‘to ensure that the “award” is an “award” within the meaning of [section 1283.4].

Two points of law were critical to the resolution of the issues on appeal: (1) a ruling is an “award” under the Arbitration Act only if it determines all questions submitted to the arbitrator that are “necessary in order to determine the controversy” and (2) it “is for the arbitrators to determine which issues were actually necessary to the ultimate decision in deciding whether a ruling constitutes an award under the statute.

Here, as in Lonky, the arbitrator could have made a final determination that she had addressed all necessary issues when she served the parties with the First Interim Award. She did not. Instead, she expressly deferred final disposition of the matter until 20 days had lapsed or, in the event either party identified an omitted issue or moved for further relief, until she issued a later ruling after additional briefing.

“By its terms, the First Interim Award was not a final ‘award’ as defined in section 1283.4 because, in issuing the ruling, the arbitrator expressly reserved for further proceedings her ultimate decision on whether all questions necessary to a determination of the controversy had been resolved and whether either party was entitled to further relief.”

In April 1999, Julian Rodriguez began working as an hourly machine operator for Lawrence Equipment Inc. a manufacturer of flat bread machinery, and later became a computer numerical control operator. In July 2014, Rodriguez executed an arbitration agreement with Lawrence. The agreement required Rodriguez and Lawrence to submit any dispute related to Rodriguez’s employment to binding arbitration. Lawrence terminated Rodriguez’s employment in October 2015. 1

In December 2015, Rodriguez filed a class action against Lawrence, alleging six different wage-and-hour violations, a seventh cause of action for Unfair Business Practices. He also sought civil penalties and wages in the eighth cause of action pursuant to the Private Attorneys General Act of 2004 (Lab. Code, § 2698 et seq.)1 (PAGA).

The trial court ordered arbitration of Rodriguez’s wage and hour claims, and stayed Rodriguez’s single PAGA cause of action pending the completion of arbitration.

In February 2018, the arbitrator issued an award in favor of Lawrence and against Rodriguez. While acknowledging that Rodriguez’s complaint “alleged that he had not been provided with proper meal and rest periods . . . that he had not been provided with accurate wage statements . . . [and] had not been paid all earned and final wages,” the arbitrator stated Rodriguez only presented evidence related to Lawrence’s alleged nonpayment of hours worked and noncompliant meal and rest breaks. The arbitrator found that Rodriguez had “failed to sustain his burden of proof as to whether he was actually required . . . to be at his work site five minutes” early, and “[e]ven if he had sustained his burden on this issue,” his timesheets failed to show he was actually there before the work shift started. The arbitrator also found that Rodriguez “received a total of thirty minutes of rest breaks each day and a thirty minute meal break,” and thus failed to sustain his burden that he was entitled to additional pay for any alleged failure to provide proper meal and rest breaks. The arbitration award stated that Rodriguez shall take nothing by way of his complaint.

After the trial court entered judgment on the arbitration award, Lawrence brought a motion for judgment on the pleadings asserting that the remaining PAGA cause of action was barred by issue preclusion since Rodriguez’s standing as an aggrieved employee was predicated on the disproven wage and hour violations. The trial court granted the motion and dismissed Rodriguez’s case.

Rodriguez appealed, contending for the elements of issue preclusion have not been satisfied. The Court of Appeal affirmed in the published case of Rodriguez v. Lawrence Equipment, Inc. -B325261 (Nov 2024).

Courts “have frequently used ‘res judicata’ as an umbrella term encompassing both claim preclusion and issue preclusion, which [have been] described as two separate ‘aspects’ of an overarching doctrine. [Citations.] Claim preclusion . . . acts to bar claims that were, or should have been, advanced in a previous suit involving the same parties. [Citation.] Issue preclusion, . . . historically called collateral estoppel, describes the bar on relitigating issues that were argued and decided in the first suit.”

At issue on appeal is whether an arbitrator’s previous adjudication of Labor Code violations in favor of Lawrence precludes Rodriguez from asserting a PAGA cause of action based on those same Labor Code violations.

In Rocha v. U-Haul Co. of California (2023) 88 Cal.App.5th 65, 77 (Rocha), Division One of the Second District Court of Appeal addressed this very issue. The Rocha court considered whether an arbitrator’s finding that the employer did not violate section 1102.5, rendered in the context of the employees’ personal claims for damages, precluded those employees from alleging in a subsequent complaint that they had standing under PAGA to seek civil penalties based on the same purported violation. (Rocha, at pp. 76-78.) Applying general principles of issue preclusion, the appellate court held the employees could not rely on the employer’s alleged section 1102.5 violation to establish PAGA standing. (Rocha, at p. 79.)

The Rocha court expressly disagreed with Gavriiloglou v. Prime Healthcare Management, Inc. (2022) 83 Cal.App.5th 595 (Gavriiloglou), which Rodriguez cites in support of reversal. In Gavriiloglou, Division Two of the Fourth District concluded the arbitrator’s finding that plaintiff had not suffered a Labor Code violation did not preclude that same plaintiff from qualifying as an “aggrieved employee” under the PAGA based on the same alleged Labor Code violations. (Id. at pp. 601-603.) Citing the Restatement Second of Judgments, Code of Civil Procedure section 1908, and several California cases about claim preclusion (not issue preclusion).

“We find persuasive Rocha’s analysis of issue preclusion and thus decline to follow Gavriiloglou.”

“We therefore conclude all of Rodriguez’s wage and hour violations, including those related to sections 226, subdivision (a), and 201, were actually litigated and necessarily decided in the arbitration proceedings.”

“We also note that Rodriguez presented no evidence at arbitration to support his sections 226, subdivision (a), and 201 contentions. The arbitration award observed: ‘The evidence presented at the arbitration hearing dealt solely with the issues of alleged non-payment for all hours worked and the allegation of legally non-compliant meal and rest breaks.’ In other words, Rodriguez chose not to present evidence on these claims at arbitration and now seeks to justify litigation of these claims based on that choice. This is precisely the type of gamesmanship that issue preclusion aims to prevent.”