Author: WorkCompAcademy

Arrow Recycling Solutions, Inc., and Arrow Environmental Solutions, Inc is a metal recycler. Just before its workers’ compensation insurance coverage was due to expire Arrow provided payroll information to Patriot Risk and Insurance Services, Inc, an insurance broker,.for the purpose of obtaining a proposal for a replacement policy. Patriot replied with a Producer’s Quote and the estimated “annual pay-in amount” was $232,094. Arrow executed a Request to Bind this policy, and later received a policy and related profit sharing agreements with the insuring entities.

Arrow alleges in a civil complaint it later filed against the carriers and broker that despite a “very good claims history,” the actual pay-in amount billed for the first year was approximately $490,000, which exceeded the estimated annual pay-in amount of $232,094. Arrow alleges that the reason for this discrepancy was that the Billing Terms “contained mathematical falsehoods” involving the misclassification of payroll amounts from higher premium classifications to lower premium classifications. Arrow alleges that it would not have purchased the workers’ compensation insurance if it had known of this inaccuracy.

However the the “Request to Bind” document signed by Arrow included an arbitration provision . The words “Initial Here” appeared under a box next to the arbitration provision. That box was empty and contained no initials in the copy of the Request to Bind attached to the complaint. Later Arrow received as part of its policy package a Reinsurance Participation Agreement (RPA). Paragraph 13 of the RPA included an arbitration provision.

The defendants filed a motion to compel arbitration and stay the trial court proceedings. They argued that all of the counts alleged against them were within the scope of the arbitration agreement in the RPA. Alternatively, they argued that any claims not covered by the arbitration agreement in the RPA were within the scope of the arbitration agreement in the Request to Bind. They also argued that Patriot had agreed to participate in any court ordered arbitration and that the fact that Patriot was not a party to the arbitration agreements did not preclude arbitration. The trial court denied the motion to compel arbitration and the defendants appealed. The Court of Appeal affirmed the denial of the motion in the unpublished case Arrow Recycling Solutions v. Applied Underwriters.

A party moving to compel arbitration bears the burden of proving by a preponderance of evidence the existence of an arbitration agreement.. An officer of Arrow stated in his declaration that the box next to the arbitration provision in the Request to Bind that he signed was left blank and did not contain his initials. His assistant Patti declared that she sent the signed Request to Bind to Patriot and that neither the initials nor the word “none” was present on the document that she provided. Defendants claim the document they received had the box checked, but the officer claimed that the handwriting was not his and the defendant’s copy was initialed by someone else.

The defendants as the parties moving to compel arbitration had the burden of producing evidence sufficient to establish the existence of an arbitration agreement in the Request to Bind, such as evidence that Patriot initialed the Request to Bind as Arrow’s agent. The defendants failed to present such evidence. The Court of Appeal concluded that the declarations of Arrow’s officers and his assistant constitute substantial evidence supporting the implied finding that Arrow never agreed to the arbitration provision in the Request to Bind and that, therefore, there was no such arbitration agreement.

It’s estimated that more than half of adults in the United States diagnosed with knee osteoarthritis will undergo knee replacement surgery. While improvements in implantable devices and surgical techniques have made the procedure highly effective, pain control after surgery remains a common but persistent side effect for patients.

A Henry Ford Hospital study, presented recently at the American Association of Hip and Knee Surgeons meeting in Dallas, found that injecting a newer long-acting numbing medicine called liposomal bupivacaine into the tissue surrounding the knee during surgery may provide a faster recovery and higher patient satisfaction.

“The pain scores for this injection technique averaged about 3/10, which is similar to the pain scores seen with our traditional method,” says Jason Davis, M.D., a Henry Ford West Bloomfield Hospital joint replacement surgeon and the study’s senior author. “Patients had pain relief for up to two days after surgery and better knee function compared with the traditional method.”

It is estimated that the number of total knee replacement surgeries has more than tripled from 1993 to 2009. Arthritis is the most common cause of chronic knee pain and disability. However, a June 2014 study found that 95 percent of knee surgeries are attributed to the epidemic of overweight and obesity in the United States.

During the two-hour knee replacement procedure, the orthopedic surgeon removes the damaged cartilage and bone, and inserts a knee implant to restore the alignment and function of the knee. More than 90 percent of knee replacements are functioning 15 years after surgery, according to the American Academy of Orthopaedic Surgeons.

In the Henry Ford study, 216 patients were evaluated for pain control the first two days after surgery from October 2012 to September 2013. Half of the patients received the traditional pain control method with continuous femoral nerve blockade, in which common numbing medicine is injected into the groin area, blunting the main nerve down the front of the knee. This method uses a pain pump to extend pain control for two days but causes some leg weakness. “Pain control came at the price of weakness and made patients somewhat tentative when walking during their hospital stay,” Dr. Davis says.

The other half of patients received the liposomal bupivacaine injection at the site of the surgery. Dr. Davis says many patients were able to walk comfortably within hours after surgery. Dr. Davis says the injection around the knee itself “optimizes pain control early on” without the side effects of the traditional technique. “Function-wise, it was a lot easier for patients to move around more confidently,” he says. “In the past decade, we’ve made major advancements in pain control for knee replacement surgery. This option is a promising, viable one for our patients.”

Hundreds of health professionals engaged in a spirited debate Monday about the proposed sale of a nonprofit Lynwood hospital to a for-profit hospital company in Ontario. According to the story in the Los Angeles Times, St. Francis Medical Center is one of six struggling Roman Catholic nonprofit hospitals that Prime Healthcare Services has agreed to buy for about $843 million in cash and assumed liabilities.

Because Prime Healthcare intends to convert the Daughters of Charity hospitals to for-profit status, the sale requires the approval of California Atty. Gen. Kamala D. Harris. Harris’ staff hosted a public hearing Monday in Lynwood to hear public feedback about the proposed sale of St. Francis. The hearing is one of six scheduled for this week in Southern and Northern California. Harris is expected to make a decision about the sale by early February.

Opponents urged Harris to reject the sale, saying Prime Healthcare places too big of an emphasis on profit and the sale would diminish the services that the Catholic hospitals provided to their primarily lower-income clientele. They also noted that the Justice Department is investigating Prime for alleged billing fraud.

Supporters of the sale note Prime’s history of rescuing struggling hospitals by reducing costs and increasing revenues, largely through tough negotiations with insurers. Prime owns 29 hospitals in California and eight other states.

Prime Healthcare Chief Executive Dr. Prem Reddy has vowed to keep the hospitals open for at least five years and retain all services, including emergency rooms. He also said he would continue to provide care to patients who are unable to pay for services.

Dr. Clayton Kazan, head of emergency care at St. Francis, was one of several of the hospital’s doctors who advocated the sale to Prime at Monday’s hearing. “Prime represents our lifeline,” he said. “Having never closed a hospital and never closed an emergency department, Prime represents our best hope.”

Scott Byington, president of the St. Francis Registered Nurses Assn., said he thinks that Prime will reduce services provided to those people unable to pay. “These patients will not be able to go to that hospital because it’s a for-profit institution,” he said.

Opponents of the sale wore blue T-shirts that said, “There is an alternative,” a reference to a competing offer to buy the hospitals from private equity firm Blue Wolf Capital.

Robert Issai, chief executive of Daughters of Charity, said the six Catholic hospitals probably would be forced into bankruptcy if Harris rejects the sale. Blue Wolf’s offer was not feasible because the firm offered to manage the hospitals without promising to buy them, he said. “It was crystal clear that Prime was the best choice.”

An independent consultant who reviewed the proposed sale for Harris had recommended that Prime be required to keep the hospitals open for at least 10 years. Reddy said that he would agree.

In addition to St. Francis, the Daughters of Charity hospitals include: St. Vincent Medical Center near in downtown Los Angeles, O’Connor Hospital in San Jose, Saint Louise Regional Hospital in Gilroy, Seton Medical Center in Daly City and Seton Coastside Medical Center in Moss Beach, north of Half Moon Bay.

Maximus Federal Services has been awarded the sole contract by the DWC to administer the IMR process for all of the treatment provided to California injured workers. The latest DWC IMR Progress Report seems to suggest that the IMR process is progressing flawlessly.

But Maximus does not seem to be a company that is flawlessly run. According to a story in the Idaho Statesman, the company has hired, laid off and rehired hundreds of employees at the call center, which opened in fall 2013 to provide customer support for the federal health-insurance exchange created under the Affordable Care Act.

This round of layoffs is permanent, according to a letter just given to Maximus employees. The Idaho Statesman obtained the letter as did the city of Boise. The letter advises that Maximus would close its office and conduct mass layoffs, according to a city spokesman.

Maximus, a Virginia company that serves health and human-service agencies under contract, is a subcontractor under a $100 million, 30-month federal government contract for services to exchange customers, according to court documents from a lawsuit against it. “The reduction in staffing is based on the term of the contract,” the letter to employees said. Maximus said in the letter that some employees will receive severance pay. Maximus did not respond to a request for comment by the Idaho Statesman.

The move seems to be somewhat chaotic. Maximus hired about 1,600 Idahoans for its Boise call-center launch in 2013. Layoffs followed in spring 2014. Several employees from the Boise call center sued Maximus over the layoffs. They claimed the company led them to believe the jobs were permanent. Maximus denied those allegations, saying its call-center work was temporary – ramping up and winding down in tandem with the federal exchange’s enrollment season each year. That lawsuit is pending in federal court.

Separately, employees at the Boise office sued Maximus in early 2014 for unpaid overtime. That lawsuit, also still pending in federal court, claimed Maximus mischaracterized the employees’ jobs and, as a result, deprived them of overtime pay. Maximus denies those allegations.

Maximus started its latest Boise-area hiring spree in summer 2014 – for the 2015 enrollment season, running November 2014 through February 2015 – and struggled to fill 1,800 openings. The Idaho Department of Labor coordinated several job fairs for the company. Maximus continued to advertise opportunities at its Boise call center as recently as Friday, on its careers website, but it had taken down the actual job listings for Boise.

This Court of Appeal decision perhaps answers the question of when is an expedited hearing too expedited.

Kristian Von Ritzhoff sustained injuries while working as a banquet server in 1996. Orthopedic injuries were admitted and psychiatric injury denied. The PTP found Ritzhoff’s right ankle permanent and stationary as of October 25, 2005. Save for its significance as the origin of Ritzhoff’s psychiatric injuries, the orthopedic injury dropped out of consideration thereafter.

Thomas Curtis MD found Ritzhoff TTD on a psychiatric basis and in need of treatment. This brought about the expedited hearing of May 18, 2006. Ritzhoff has been representing himself since 1998. The defendant began to cross-examine him at this hearing. He effectively admitted working from time-to-time since his injury in 1996. However, the WCJ terminated cross-examination over the defendant’s objection and even though the defendant had not finished because of alleged time constraints arising from the expedited nature of the hearing. The WCJ also noted that the videotape the defendant sought to have admitted was “more appropriate for later cross-examination (of a doctor and/or applicant as to accuracy of his history) rather than at this stage of the proceedings.” Nonetheless the WCJ found Ritzhoff temporarily totally disabled from a psychiatric injury based upon a 1999 medical report. The WCAB denied reconsideration of this order.

By August 2008, Ritzhoff had received electric shock therapy and by November 6, 2009, had attempted suicide by hanging while he was hospitalized. Dr. Curtis opined that it was obvious to him Ritzhoff was totally and permanently disabled on a psychiatric basis.

There now followed three hearings. The first two focused on whether Ritzhoff was psychiatrically permanent and stationary and thus no longer entitled to TTD. The third hearing ended with the finding that Ritzhoff was 100% disabled. Ritzhoff refused to be cross-examined at all three of these hearings.

Ritzhoff requested the April 23, 2009 expedited hearing to resolve the issue of TTD benefits. Dr. Gilberg, the independent medical evaluator in psychiatry appointed by the WCJ, issued a report that Ritzhoff would become permanent and stationary psychiatrically by December 31, 2008. The WCJ asked Ritzhoff to take the stand. Ritzhoff stated: “I object to be cross-examined without an attorney.” The WCJ told him he was his own attorney, as he indeed had been since 1998. Ritzhoff took the stand only to deliver a short monologue. The Court of Appeal noted that “The hearing continued on its downhill path…… finally collapsed in inconclusive confusion, one reality did emerge. Ritzhoff was true to his word; he did not testify. This hearing concluded without a word of testimony by Ritzhoff. ” Nonetheless the WCJ concluded that Ritzhoff was temporarily totally disabled. The appeals board affirmed the WCJ’s order. However, the appeals board noted defendant’s legitimate complaints regarding the opportunity to cross-examine Ritzhoff. The appeals board explicitly stated that “[i]f [Ritzhoff] intends to continue to prosecute his claim for workers’ compensation benefits, he must submit to cross-examination.”

Another hearing on October 27, 2009 requested by Ritzhoff was essentially the same. The WCJ did not allow cross-examination on issues related to temporary total disability and stated that this issue was already settled. Ritzhoff eventually took the stand. However, he squarely refused at least six times to answer defense counsel’s questions. In short, as in the first hearing, Ritzhoff did not testify at the second hearing. The WCJ ordered the defendant to reinstate treatment with Dr. Curtis. The appeals board denied defendant’s petition for reconsideration and let the WCJ’s decision on temporary total disability “stand, but only ‘for now.’”

The matter came on for hearing over the objection of the defendant on May 30, 2013. Discovery remained open until the final mandatory settlement conference. However, since the October 27, 2009 hearing, the defendant still was unable to obtain the deposition of Dr. Gilberg, who had recused himself because of harassment by Ritzhoff. At the hearing, Ritzhoff preemptively refused to respond to any questions by defendant. With no testimony being allowed, Ritzhoff was nonetheless found totally permanently disabled and no basis for apportionment. Reconsideration was denied

The Court of Appeal reversed and remanded in the unpublished case of Ogden Entertainment Services v. WCAB.

“For two centuries past, the policy of the Anglo-American system of Evidence has been to regard the necessity of testing by cross-examination as a vital feature of the law.” “We address in this case therefore nothing less than one of the fundamental guarantees of a fair trial or, as in this case, a fair hearing, for there is no doubt that the right of cross-examination is guaranteed to the parties in workers’ compensation proceedings.” “Give what the purposes of cross-examination are, we must correct the misperception shared by the WCJ and the appeals board that, as a layperson, Ritzhoff had nothing to add as a witness.” “The importance of cross-examination as a means of testing and attacking the credibility of a witness is undiminished in the modern era.”  

Indeed, the Court of Appeal unraveled the case to a point earlier than the last hearing by stating “The appeals board’s view that the defense should have sought review of its decision regarding cross-examination following the first and second hearings ignores the plain fact these were not final decisions of the appeals board and thus were not reviewable in this court under the aegis of a writ of review.”