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Author: WorkCompAcademy

Video Surveillance Convicts Greenfield Woman

The Monterey County District Attorney’s Office reports that a 52-year-old Greenfield woman was sentenced to three years probation and 90 days in jail for making a false workers’ compensation claim.

Ema Pantoja pleaded guilty on April 30 after claiming for three years she’d extensively damaged her wrist while working at Scheid Vineyards in January 2007. Over the course of several years, Pantoja was examined by a number of doctors and testified under oath concerning her physical limitations.

Continuing to receive treatment through May 2010, Pantoja told doctors she had not driven since her injury, but video surveillance captured her engaged in activities inconsistent with her testimony.

Over the course of the years, Pantoja racked up $16,298.41 in doctors’ bills paid out by Zenith Insurance Company. Prior to sentencing, she paid full restitution.

Keith Wilson, of Zenith, compiled the case and presented it to Martin Sanchez, DA investigator specialized in workers’ compensation fraud cases.

Illegally Uninsured Salinas Employer Convicted

Fernando Rodriguez, 47, of Salinas, has admitted that he failed to secure workers’ compensation insurance for his employees, a criminal offense in violation of the Labor Code. Rodriguez, who owns Zavala’s Transmission in Salinas, was immediately sentenced and placed on probation by Monterey County Superior Court Judge Elisabeth Mineta.

Investigators contacted Rodriguez on Feb. 20 during a compliance check on employers who were suspected of not having workers’ compensation insurance for their employees, prosecutors said. The operation was organized and led by the District Attorney investigators from the Workers’ Compensation Fraud Unit. Assisting in the operation were investigators from the California Department of Insurance.

District Attorney Investigator Christy Gunter investigated the case and discovered that, in addition to not having workers’ compensation insurance, Rodriguez was not registered as an employer with California’s Employment Development Department, did not have a Salinas business license and was operating an unregistered auto repair shop, the DA’s office said.

Prior to his court plea, Rodriguez obtained all of the necessary licenses, registered with EDD and obtained workers’ compensation insurance. The judge took all this into consideration at sentencing, prosecutors said. Rodriguez was placed on misdemeanor probation for a period of three years. Along with standard terms and conditions of probation, he was ordered to serve one day in Monterey County Jail and pay a substantial fine.

Alcohol Consumption Related to Surgical Complications

People who have more than a couple of alcoholic drinks every day tend to have more complications after surgery than teetotalers or light drinkers, according to a review of past studies. This finding might be something UR or IMR physicians might want to consider when asked to authorize a surgery, or, this might be the basis of an argument for apportionment of permanent disability based upon causation in a case where a heavy drinker has a bad surgical outcome.

According to the summary in Reuters Health, the analysis confirms that “alcohol and surgery are a bad combination,” Bolette Pedersen of the Clinical Health Promotion Center of Bispebjerg and Frederiksberg University Hospital in Denmark, told Reuters Health by email. But it’s not clear what effect stopping drinking before surgery would have on complications, said Pedersen, who was not involved in the review.

Infections and slow wound healing were the most common complications associated with heavy drinking, according to lead author Marie Eliasen of the National Institute of Public Health at the University of Southern Denmark in Copenhagen.

Eliasen and her coauthors examined the results of 55 studies on pre-op drinking and post-op complications occurring up to 30 days after surgery. The studies looked at head and neck, abdominal and orthopedic surgeries for a variety of conditions, none of which was related to alcohol use. Patients who drank heavily leading up to surgery, including those who abused alcohol or were dependent on it, were more than twice as likely to die in the month after their procedures than abstainers – though the risk of dying varied greatly by procedure.

Heavy drinkers were also 73 percent more likely to contract a post-op infection, 80 percent more likely to have difficulty breathing and 29 percent more likely to be admitted to the intensive care unit than non-drinkers, according to results published in the Annals of Surgery. The associations were stronger with abdominal surgery – which can include gallbladder, liver and stomach procedures – than with other types of operations.

Low to moderate drinking – a drink or two per day or less – was not tied to post-op complications, but only a few studies addressed that group, Eliasen told Reuters Health. Heavy alcohol use over time compromises the immune system, which makes the body more susceptible to infections, she said. “Moreover, high alcohol consumption increases the endocrine stress response to surgery which may worsen existing conditions and reduces blood coagulation giving an increased risk of bleedings and slowing down wound healing processes,” she said.

The studies looked at alcohol consumption over different lengths of time, from months to years, so it’s unclear what duration of alcohol use leads to higher risks or when a patient’s drinking has the strongest effects. But it’s likely that the more you drink, the quicker the extra risks would appear, Eliasen said. A previous study found that post-op risks declined when patients stopped drinking four or more weeks before surgery, she said.

Study Finds Social Issues Influence Back Pain Recovery

Researchers at the University of Huddersfield have investigated recovery from back pain and the problems faced by sufferers when they attempt to return to work. The latest phase of research has broken new ground by focusing on the influence of the family or “significant others.” Headed by the psychologists Dr Joanna Brooks and Dr Serena McCluskey, of the University’s Institute of Research into Citizenship and Applied Human Sciences, the project has interviewed both chronic back pain sufferers who have managed to remain at work and those who have been unable to return. Family members were also interviewed, widening understanding of the issues surrounding recovery from back pain and return to work. The research discovered marked differences between the two groups.

According to the summary in Science Daily “Those who managed to stay at work had greater flexibility in their jobs — more professional occupations with more autonomy” said Dr McCluskey. “This type of work appeared to be very important — it seemed to help them manage their back pain condition and they had more support from their employers.”

The researchers found that the family members of those who managed to stay at work were much more independent of each other. “They were supportive but seemed quite separate; whereas the families of back pain sufferers that weren’t working were very involved in each other’s lives,” said Dr McCluskey. It was also important to note, added Dr McCluskey, that the current economic climate meant that it was not easy for back pain sufferers to find work or retrain for other, more suitable occupations.

This work draws attention to the role that social factors play in back pain and how families, physicians and employers can play a supportive role in enabling sufferers to return to work. The back pain research projects that she and her colleagues have conducted so far have been funded by the organization BackCare — formerly the National Back Pain Association — and by the BUPA Foundation. Now there is to be further research, backed by the University of Huddersfield’s School of Human and Health Sciences Research and Innovation Fund.

“This will focus on people just starting to present with back pain, going to their GP requesting time off work. We do know that you have got to intervene with back pain patients early. Once they get to a chronic stage it is very difficult for them to return to work,” said Dr McCluskey. “We would like to explore new ways to intervene, using family members to aid the process.”

SCIF Files RICO Lawsuit Against Pacific Hospital of Long Beach Entities

On June 24 the State Fund filed a RICO action in the United States District Court against California Pharmacy Management LLC, Coastal Express Pharmacy Inc, Michael R Drobot Jr, Michael D Drobot Sr, HealthSmart Pacific Inc. (a California corporation), Industrial Pharmacy Management LLC, Long Beach Pain Center Medical Clinic Inc, Long Beach Prescription Pharmacy and Meds Management Group LLC. The case has been assigned to Judge Andrew J. Guilford for all further proceedings.

The complaint alleges “Defendants in this case conspired and participated in a scheme to defraud State Fund in connection with the submission and collection of fraudulent insurance bills for medical services, spinal implant hardware, medications, and other services…” The complaint goes on to specifically allege “Defendants: (a) formed and operated shell corporations and represented that these corporations were manufacturers of spinal hardware and billed as if these corporations did manufacture the spinal hardware, when they did not; (b) billed for services at substantially higher rates than are allowed under the Official Medical Fee Schedule (“OMFS”), which governs rates that may be charged for certain services rendered in workers’ compensation cases by, among other things, “upcoding’; and “unbundling” items in their billings; (c) billed at rates up to ten times the average rate for over-the-counter medication; (d) represented and billed nurses as assisting surgeons; ( e) double-billed State Fund for radiology services; and (f) engaged in further conduct to conceal their various schemes, which were designed to, and did, induce State Fund to pay the fraudulent bills.” SCIF claims that these acts constitute a violation of the Racketeer Influenced and Corrupt Organizations Act, 18 U.S.C. §§ 1961 et seq. (“RICO”).

State Fund alleges it has paid Pacific Hospital at least $141 million for services purportedly rendered by Pacific Hospital pursuant to its workers’ compensation policies. This includes at least 16,490 bills for services, including spinal surgery and implants. State Fund has also paid over $20 million to the Pharmacy Defendants. State Fund claims to be “one of the largest victims of Defendants’ unlawful behavior.”

In the sixth cause of action, the Fund seeks to rescind settlement agreements to resolve liens filed with the WCAB with the Defendants that resolved lien claims as far back as 2004. The Fund alleges that State Fund’s consent to enter into these settlement agreements was obtained by fraud” and that “At the time State Fund entered into the settlement agreements, it was unaware of the true facts and would have acted differently if it had known the true facts.

The U.S. attorney for the Central District of California has been investigating allegations that the Pacific Hospital of Long Beach executive paid kickbacks to physicians so they would refer their patients for spine surgery at his facility. Over the past 15 years, Michael D. Drobot built a Southern California business empire centered on treating people with back problems, many of them workers’ compensation patients. At the heart of the operation is Pacific Hospital of Long Beach, a 184-bed facility that Mr. Drobot bought in 1997 and turned into a spine-surgery center.

Last April, Federal Bureau of Investigation agents raided the hospital and another company owned by Mr. Drobot as part of what the agency termed a fraud investigation. Representatives for the FBI and the U.S. attorney’s office declined to give specifics about the probe. According to the article in the Wall Street Journal, people familiar with it say it is focused on allegations that Mr. Drobot operated a kickback scheme, under which he allegedly paid doctors thousands of dollars for each spine surgery they referred to Pacific Hospital. Under California’s anti-kickback statute, it is illegal to pay money to induce patient referrals. The practice is also illegal under federal law if the patients referred are insured by government health programs such as Medicare or Medicaid.

Claimant Convicted of Comp Fraud Loses Appeal of Fines and Fees

Stephen Eugene Harder, 45, who resides in Woodland, was found guilty of five counts of workers’ compensation fraud (Ins. Code, § 1871.4.) after a January 2012 jury trial. The case stemmed from a February 2009 complaint from the State Compensation Insurance Fund alleging Harder “was attempting to exaggerate his industrial injury and claiming that it was more severe than it actually was.” An investigation reportedly revealed Harder engaging in activity, such as gold mining, that was inconsistent with his claimed injuries.

The trial court suspended imposition of sentence and placed him on five years’ probation subject to various terms and conditions set forth in a three-page written probation order. At the sentencing hearing, the trial court gave the probation order to Harder to sign, along with another document that purportedly “explain[ed] how [the court] calculated the fines and fees that [we]re included in the conditions of probation.” Harder signed the probation order immediately under a line that read, “I hereby certify that I understand the terms and conditions of my probation as set forth in this order.”

The probation order required him to pay $500 as a fine plus $1,500 penalty assessment; plus a processing fee of $35, and pay $240 as a restitution fine for each felony case and $120 as a restitution fine for each misdemeanor case to the State Restitution Fund pursuant to PC § 1202.4(b); plus a processing fee of $20 for each felony case and a $10 processing fee for each misdemeanor case, and be confined in the Yolo County Jail for a period of 150 days with credit for time served, and 90 days jail stayed, and pay restitution in the sum of $159,801.74 covering losses related to the charge(s) s/he stands convicted of, or in accordance with the plea agreement; plus interest at the rate of 10% per annum; plus a collection fee of 10% of the restitution total; (PC § 1202.4).

Harder appealed claiming various errors with respect to the fees, fines, and costs the trial court imposed in granting him probation. The Court of Appeal in the unpublished case of People v Harder found these claims of error forfeited for failure to raise them in the trial court. He also claimed his trial attorney was ineffective in failing to make these arguments. The Court of Appeal concluded that Harder’s trial attorney was not ineffective, but ordered the trial court to impose the $1,500 penalty assessment and the $35 processing fee as separate orders and not as conditions of his probation as the trial court did here. Otherwise, the Court of Appeal found no error.

DWC Posts Adjustments to DMEPOS Section of OMFS

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, be adjusted to conform to changes to the Medicare payment system that were adopted by the Centers for Medicare and Medicaid Services for calendar year 2013.

Effective for services rendered on or after July 1, 2013. 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 2013 “Durable Medical Equipment, Prosthetics/Orthotics, and Supplies (DMEPOS) Fee Schedule” revised for July 2013, contained in the electronic file “DME13” which is incorporated by reference. The update includes all changes identified in CR8325.

The revision is available on the Internet at the website of the Centers for Medicare and Medicaid Services.

SCIF Appoints New Chief Medical Officer

The State Compensation Insurance Fund selected Dr. Dinesh Govindarao as its new Chief Medical Officer for the organization effective July 8, 2013. As Chief Medical Officer, Govindarao will represent State Fund as an advocate for California injured workers and a driver of change in regulatory and medical forums. His duties are to provide critical oversight of the organization’s Medical Provider Network (MPN), work with State Fund’s Claims Medical Division to develop policies, procedures, and enhanced programs that drive high quality care for injured workers and work collaboratively with State Fund’s Utilization Review organizations to optimize processes.

Tom Rowe, President and CEO of State Fund, said of Govindarao, “State Fund is fortunate to have Dr. Govindarao come onboard and bring his unique and seasoned perspective to head our medical operations. He is a proven leader with demonstrated success and I am confident that Dr. Govindarao will contribute significantly to our commitment of restoring injured workers to California workplaces.”

Prior to his State Fund selection, Govindarao served as VP and medical director at Concentra, and as medical consultant to various organizations including NASA’s Jet Propulsion Laboratory and Toyota. Dr. Govindarao earned a Bachelor of Science degree in Genetics from UC Berkeley, a medical degree from Hahnemann University School of Medicine in Philadelphia, PA, and a Masters in Public Health degree from UCLA. He is board certified in Occupational and Environmental Medicine.

One Lien Activation Fee Required In Multiple Injury Claim

Elia Hinks claimed that she sustained industrial injury to her head, back, shoulder, lower extremities and multiple body parts as a result of a specific injury and a continuous trauma. Two applications were filed accordingly. Lien claimant, MH Express Pharmacy filed a lien in the specific injury case only in 2004. The specific injury case was then dismissed without prejudice in 2006. The pharmacy claims it was never notified of the dismissal.

The pharmacy paid the lien activation fee in the dismissed specific injury case (ADJ2499103) on March 15, 2013, six days prior to the March 21,2013 lien conference. On March 21, 2013, the WCJ issued an Order Dismissing Lien Claim for Failure to Pay Lien Activation Fee with prejudice. The WCJ notes in her Report that there was no lien activation fee paid prior to the lien conference in the remaining continuous trauma case (ADJ3239580). The pharmacy lien claimant filed a petition for reconsideration of that Order.

Administrative Director (AD) Rule 10208, subdivision (a) provides that “Any lien filed pursuant to Labor Code section 4903(b) filed prior to January 1,2013, and any cost filed as a lien prior to January 1, 2013, shall be subject to a lien activation fee in the sum of one hundred dollars ($ 100.00), payable to the Division of Workers’ Compensation prior to filing a Declaration of Readiness to Proceed for a lien conference by that party, prior to appearing at a lien conference for a case, or on or before January 1, 2014, whichever occurs first. The $100 fee is payment for the activation of a lien. A lien activation fee is required for each lien filed prior to January 1, 2013, and for each cost filed as a lien prior to January 1, 2013; however, where one or more liens or one or more costs filed as lien is filed in one or more cases involving the same injured worker and same service or services by the same lien claimant, only one lien activation fee is required.”

As a result of this regulation, the WCAB granted reconsideration and ruled in the case of Hinks vs Pavlo Weinberg and Associates, that only one activation fee was required. The Order dismissing the lien claim was rescinded, and the case was returned to the trial level for further proceedings.

Court of Appeal Reverses Dismissal of A Premiere Medical Lien Claimant

In 2002, the California Insurance Guarantee Corporation Association initiated a proceeding against Premier Medical Management Systems, Inc. in which it alleged that Premier engaged in billing fraud, fee splitting and the unauthorized practice of medicine. A number of other like actions were filed which were consolidated in 2004. At some point, two of Premier’s executives, David Wayne Fish and Birger Greg Bacino, as well as Premier itself, were criminally charged with filing false and fraudulent claims, filing false tax returns and unlawfully receiving compensation for the referral of clients. Fish and Bacino entered into a plea bargain in 2010 under which they agreed to dismiss with prejudice lien claims filed by the “Premier Providers” that were listed in the October 17, 2006 letter of representation provided to the WCJ by the lawfirm of Riley and Reiner

Champion Medical Group, a California Corporation doing business as Universal Psychiatric Medical Center, Inc, was one of many lien claimants represented by Premier Medical Management Systems, Inc. Universal assigned some of its liens to Premier for purposes of collection. As part of a plea bargain Premier dismissed the lien claims of 109 entities, Universal’s included. The workers’ compensation administrative law judge upheld the dismissal of Universal’s claim over its objections and the WCAB denied Universal’s petition for reconsideration without issuing an opinion of its own.

Universal claims that it was not a Premier Provider; that Universal only hired Premier to perform billing and collection services and had no authority to dismiss its liens, In response the WCJ gave 10 reasons why Premier had the power to dismiss liens of the Premier Providers including the Universal liens with prejudice.

The Court of Appeal in the unpublished opinion of Universal Psychiatric Medical Center, Inc. v WCAB ruled that “as it turns out, none of these reasons apply to Universal.” In rejecting the decision of the WCAB, the Court of Appeal went on to say that the “fundamental flaw in the WCJ’s reasoning is that the WCJ analyzed and addressed issues that were common to most of the lien claimants, whom the parties have chosen to designate collectively as the Premier Providers, and that the WCJ ignored the facts that were unique to Universal’s case. That is, the WCJ validated the resolution of the global case involving over 100 Premier Providers but failed to address Universal’s case. As it turns out, there is evidence that Universal did not authorize Premier to dismiss its liens. Concomitantly, the entire body of evidence on which the WCJ relied to find that Universal did authorize Premier to dismiss its liens is irrelevant to Universal, however relevant it may be to the Premier Providers. In fact, there is evidence that Universal cannot be included in the class of Premier Providers.”

The decision of the Workers’ Compensation Appeals Board denying Universal’s petition for reconsideration was annulled and the case was remanded to the Workers’ Compensation Appeals Board with directions to grant the petition for reconsideration and to enter an order vacating the dismissal of Universal’s liens and to conduct such further proceedings as are consistent with this opinion.