Author: WorkCompAcademy

The Department of Industrial Relations  announced a reduction in Independent Medical Review and Independent Bill Review fees effective January 1, 2015. This is the second reduction in fees since the inception of the IMR/IBR program and will no doubt be good news to the workers’ compensation community. The following are the announced fee reductions.

IMR Fees – Any IMR application submitted on or after January 1, 2015 will be subject to the following fee schedule:

Standard IMRs Involving Non-Pharmacy Claims*
Fee effective April 1, 2014: $420 per IMR
Fee effective Jan. 1, 2015: $390 per IMR

Standard IMRs Involving Pharmacy Only Claims**
Fee effective April 1, 2014: $390 per IMR
Fee effective Jan. 1, 2015: $345 per IMR

IMRs Terminated or Dismissed Not Forwarded to a Medical Professional Reviewer:
Fee effective April 1, 2014: $160 per IMR
Fee effective Jan. 1, 2015: $123 per IMR

IBR Fees – Any IBR application submitted on or after January 1, 2015 will be subject to the following fee schedule:

Completed IBR
Fee effective April 1, 2014: $250 per IBR
Fee effective Jan. 1, 2015: $195 per IBR

Ineligible IBR Not Sent to Review***
Fee effective April 1, 2014: $50 per IBR
Fee effective Jan. 1, 2015: $47.50 per IBR

* A “non-pharmacy-only” IMR is an IMR where not all treatments in dispute fall under the service category, “pharmaceuticals.”
** A “pharmacy-only” IMR is an IMR where all treatments in dispute fall under the service category “pharmaceuticals.”
*** Sending an IBR to review means assigning and providing the complete file to a certified coding specialist with the expertise necessary to evaluate and render decisions on all line items in dispute.

The State Fund Compensation Insurance Fund’s Board of Directors has approved a $37 million dividend to qualifying policyholders for the 2014 policy year. The dividend represents approximately 2.6 percent of policyholders’ 2014 estimated annual premium.

“In addition to declaring a $37 million dividend, we strengthened our reserve position to improve State Fund’s financial strength for the long term, thanks to strong investment returns,” said Vern Steiner, President and CEO.

In order to be eligible for the 2014 policy year dividend, policyholders must:

1) Have completed no less than 335 days of continuous coverage during their 2014 policy term.
2) Have not canceled during their 2014 policy term.
3) Have complied with the State Fund audit and as a result the final audit was completed within 18 months of the 2014 policy inception. No dividend shall be paid on any premium owed or paid as a result of an audit.
4) Be current on 2014 premium payments.

Payments for a dividend will be based on the inception dates of policies. This action brings total dividends declared by State Fund since 2011 to $287 million.

San Francisco-based State Fund is the largest workers’ compensation insurance carrier in the state with more than 130,000 employer policyholders. Dividends were temporarily suspended after a $92 million dollar distribution in 2001 until the approval of a $50 million dividend in 2011 followed by a $100 million dividend for the 2012 policy year and another $100 million dividend for the 2013 policy year and now a $37 million dividend for last year. Since its inception in 1914, the State Fund has paid more than $5 billion in dividends to policyholders.

Victor Santiesteban was employed by American City Pest and Termite as a service technician until American learned he was simultaneously working for his son at another pest-control company in violation of his agreement with American. While employed by American, Santiesteban worked a night route from 4:00 p.m. to about 10:00 p.m. in a company-assigned vehicle. Santiesteban’s last day of work for American was October 26, 2009. Santiesteban filed a claim for Unemployment Insurance, which was denied on December 8, 2009. His appeal of the denial of the insurance claim was denied on or about April 7, 2010.

On January 25, 2010, Santiesteban filed a workers’ compensation claim for an injury he allegedly suffered on October 1, 2009. In the workers’ compensation claim form, Santiesteban stated he had been rear-ended while in an American truck and had suffered injuries to his “trunk.” Santiesteban’s workers’ compensation claim ultimately went to the Workers’ Compensation Appeal Board where it was denied. Although no award was made to Santiesteban, investigation fees, copy service fees, and defense attorney fees were paid out.

Santiesteban was deposed in connection with his workers’ compensation claim. At the deposition, Santiesteban testified he had suffered injuries in an accident in October 2009 while driving his assigned American truck northbound on the 110 Freeway toward the 101 Freeway after fumigating a restaurant on Figueroa Street. Santiesteban did not remember the precise date of the accident. He remembered the accident occurred at night, but did not remember the exact time. When his truck was struck, he pulled to the side of the road. Five other vehicles were involved in the collision. Based on what other drivers told him, he believed the driver of a black Chevrolet Blazer caused the accident. He obtained insurance information from that driver, but he “hardly remembered anything” about the vehicle that struck him because he was too nervous.

Santiesteban attempted to contact his supervisor to report the accident but was unable to reach him. It was not until the following day that he was first advised there was an accident form in the glove compartment of his vehicle that needed to be completed. Santiesteban indicated he realized the night of the accident he had been injured. He felt pain that night and the pain worsened the following day. When he reported the accident to his employer the following day, he indicated he was experiencing pain from the accident. Santiesteban described going to Harbor UCLA Hospital a few days after the accident and receiving treatment for his injuries.

A jury convicted Santiesteban of the offense of making a fraudulent statement in his workers’ compensation claim in violation of Insurance Code section 1871.4, subdivision (a)(1) (count 1), and of the offense of attempted perjury under oath in violation of Penal Code sections 118, subdivision (a), 664, subdivision (a) (count 2). Santiesteban appealed the conviction, and the Court of Appeal affirmed the conviction in the case of People v Santiesteban.

In addition to other evidence presented in the criminal case, it was shown that Santiesteban’s vehicle was equipped with a “Teletrac” global positioning device at all times. Katie Witman, Teletrac’s Director of Customer Implementation, testified Telectrac tracks vehicles through cell towers. A report of Santiesteban’s vehicle’s movements and locations was generated for the period from September 30, 2009, through October 2, 2009. At 3:00 a.m. on October 2, 2009, Santiesteban’s vehicle was on the 101 Freeway traveling at 44 miles per hour. At 3:05 a.m., Santiesteban’s vehicle was traveling to 5851 Sunset Boulevard. The vehicle spent about 10 minutes on the 101 Freeway and was never at the 110/101 Freeway interchange. A vehicle stopped for 20 to 25 minutes would have been noted on the Teletrac report.

Edward Messinger, an insurance fraud investigator for the Orange County District Attorney’s office, was assigned to Santiesteban’s case. Messinger verified Santiesteban’s identity and matched it to the records involving his claim. Messinger also matched Santiesteban’s medical records from UCLA to his medical history. The records contained no mention of the October 1, 2009, accident or back pain. The records reflected no doctor visit during September and October 2009.

A review of the record including the possible issues raised by appellate counsel, has disclosed no reasonably arguable appellate issue. On its own motion, an appellate court with jurisdiction of a case may order correction of clerical errors contained in the abstract of judgment. The case is remanded to the trial court with directions to amend the sentencing minute order to reflect the jail sentence was imposed on both counts.

The Second District Court of Appeal reversed the WCAB finding that the medical evidence on the cause of the psychiatric injury and sleep disorder was not substantial evidence because it is based on an inadequate medical history. Here is what happened in the unpublished case of Radiator USA v. WCAB.

Am Kang sustained an admitted injury to his back on December 24, 2010 while working as a driver for Radiator USA. Kang additionally claimed to have sustained injury to his psyche in the form of a sleep disorder. David B. Pechman, M.D. was the AME in orthopedics. He noted that compression fractures in Kang’s vertebrae appeared old and he thought that most of Kang’s pain related to the compression fractures. Dr. Pechman apportioned 50 percent of the orthopedic injury to nonindustrial preexisting metabolic bone disease.

Rodney Bluestone, MD, the qualified medical evaluator of rheumatology, confirmed Kang had metabolic bone disease (osteopenia and osteoporosis) but could not determine a cause. Although Dr. Bluestone requested additional testing to determine the cause of the metabolic bone disease, there was no supplemental report that addressed causation.

Ana L. Nogales, Ph.D., evaluated Kang as a secondary treating physician in psychology. Dr. Nogales obtained a history of the injury, history of the treatment, and physical and emotional complaints exclusively from Kang. Dr. Nogales explicitly noted that she did not receive medical or employment records for review.

On the issue of causation, Dr. Nogales found that, as a “consequence of his industrial accident, Mr. Kang developed anxiety that increased with the passage of time and deteriorated at the end of 2011 when he saw that his condition is not improving.” Dr. Nogales opined that the “percentage of total causation of Mr. Kang’s current mental disorder is estimated at a higher level than the legal threshold of industrial causation of 50 [percent].” She specifically noted a nonindustrial causal factor of a dog bite in 2005 requiring stitches. Dr. Nogales made no mention of Dr. Pechman’s orthopedic diagnosis or his apportionment to the preexisting bone disease.

The matter was heard on September 26, 2013. The sole medical evidence of psychiatric industrial causation came from psychologist Dr. Nogales. Based upon this evidence, the WCJ issued findings of fact concluding Kang sustained industrial injury to his back, to his psyche, and in the form of a sleep disorder. Reconsideration was sought based “upon a lack of medical evidence to support this finding.” Reconsideration was denied. The appeals board found the doctors “based their opinions on extensive discussions with [Kang] regarding how he sustained his injury and his condition thereafter.” The appeals board found that, based on these discussions, Dr. Nogales concluded the industrial cause of Kang’s psychiatric injury was higher than the legal threshold. However the Court of Appeal reversed and remanded in the unpublished case.

In reversing the Court of Appeal noted that Dr. Nogales was completely unaware of the fact that Dr. Pechman had apportioned 50 percent of the orthopedic injury to nonindustrial preexisting metabolic bone disease. The Court posed the question does “this mean that 50 percent of the psychiatric injury is attributable to nonindustrial causes?”

The Court acknowledge that “these determinations cannot be made with mathematical precision, it is at least a major issue what portion of the psychiatric injury is attributable to nonindustrial causes. Although 50 percent is a reasonable surmise, on this silent record it is equally plausible to suppose that, given that psychiatric evaluations are unavoidably case-specific, 60 percent of the psychiatric injury – or 40 percent thereof – is attributable to nonindustrial causes. In short, what is needed here is an expert opinion that is based on a complete medical history, which necessarily includes Dr. Pechman’s finding that 50 percent of the orthopedic injury is attributable to nonindustrial causes.”

“Given the lack of competent medical evidence on causation, the decision of the appeals board cannot stand. It is now well established that the appeals board has an affirmative duty to develop an adequate record. As an example, where the medical evidence was evenly balanced on the issue of industrial causation, our Supreme Court held that the appeals board was not free to simply rule that the employee had failed to sustain his burden of proof but was required to take additional evidence in order to resolve the doubts raised by the existing medical reports”.

The decision of the appeals board is annulled and the matter is remanded for further proceedings consistent with this opinion.

As authorities conducted a drug raid on Salinas’ Chinatown last Thursday, a second set of federal officers searched a Salinas doctor’s office and home in connection with an alleged fraud case.

The Californian reports that Dr. Steven Mangar, who runs Pacific Pain Care Institute, was arrested on Valentine’s Day last year on suspicion of driving under the influence of methamphetamine. A California Highway Patrol officer stopped 44-year-old Mangar at Highway 101 and Sanborn Road. But, prosecutor Ed Hazel said the U.S. Department of Justice crime lab in Sacramento is so backed up, Mangar’s toxicology report was not available until last month. Mangar was charged Jan. 21. He was ultimately arraigned 364 days after his arrest. Mangar’s arraignment in Monterey County Superior Court followed a day after federal agents swooped down on his West Alisal Street office and his home on Madeira Avenue in Salinas. Authorities with the Monterey County District Attorney’s Office’s Health Care and Workers’ Compensation fraud units served the search warrant with help from the State Medical Board, the Department of Insurance, the Drug Enforcement Agency and the DOJ Office of the Inspector General. At the same time, another alphabet soup of agents searched Salinas’ Chinatown for methamphetamine, heroin, marijuana and cash. Twelve arrests stemmed from that raid.

Between 2005 and 2012, Mangar collected 10 traffic citations for minor incidents, Hazel said. In that time period, he was also sued four times in civil court. This was not the first time Mangar has come under scrutiny from the State Medical Board. On Oct. 5, 2012, Mangar was placed on three years’ probation following an investigation into his treatment between 2003 and 2010 of a 60-year-old man who had chronic neck pain. According to court documents, Mangar kept shoddy records that indicated he examined the patient at times when, in fact, he hadn’t. Mangar prescribed the man Percocet and Oxycontin, both powerful pain killers, according to the records. After the investigation, he was ordered to enroll in prescribing practices and record-keeping courses.

On May 15, 2013, Mangar was cited and fined $350 for failing to submit a quarterly declaration in conjunction with his probation.

On Nov. 6, 2014, Medical Board officials filed a petition to revoke Mangar’s probation. Doing so could result in the loss of Mangar’s physician’s and surgeon’s certificate. The petition revolved around Mangar’s treatment of a 40-year-old man with chronic back pain, according to court records. Although the patient’s quality of life didn’t improve, Mangar continued prescribing him Oxycontin. He later added in Ritalin when the man said he couldn’t stay awake. In doing so, Mangar acted unprofessionally and failed to develop an objective-oriented treatment plan, according to the allegation. A decision is still pending in that petition.

ProPublica analysis shows Mangar was the third-leading hydrocodone prescriber in California in 2012. Hydrocodone, also known as Vicodin, is another powerful pain killer. In 2012, 72 percent and 55 percent of Mangar’s 241 patients filled Schedule II and Schedule III drug prescriptions, respectively, according to ProPublica. Drugs are classified into five categories, per the DEA. Schedule II drugs are potentially highly addictive. Schedule III drugs carry a moderate to low risk of abuse. On average, specialists in Mangar’s area only prescribed Schedule II and Schedule III drugs 4 percent and 13 percent of the time, respectively. Only 23 percent of Mangar’s prescriptions were for brand names, compared with a 29 percent average at other specialists’ offices. But Mangar’s prescriptions also cost $170 on average compared with $99 from other prescribers.

Mangar, who is represented by defense attorney Susan Chapman, is expected to return to court March 5, Hazel said. Mangar and Chapman weren’t immediately available for comment.