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Two Business Owners Face Charges

Two business owners out of Soledad and Monterey pleaded guilty Friday to failing to secure workers’ compensation insurance, both misdemeanors, according to the Monterey County District Attorney’s Office. Everado Nieto, 47, and Guz Lazrovich, 38, were each placed on three years’ probation and made to pay several thousand dollars in fines. Nieto owns Evercleen, a Soledad-based carpet cleaning business. An employee filed a complaint with the Division of Labor Standards Enforcement indicating he was owed wages and had been injured on the job.

During the DA’s investigation, Nieto was invited to a Contractor State License Board sting operation in which it was learned he had employees but not the required workers’ compensation insurance, prosecutors said. In addition to probation, he was ordered to maintain insurance, waive his search and seizure rights and pay a $10,000 fine with $45,000 suspended during the term of probation.

Lazrovich is a licensed contractor out of Monterey who indicated to the CSLB he was exempt from maintaining insurance as he did not have employees. On July 16, CSLB investigators discovered employees of Lazrovich paving a driveway in Monterey. Lazrovich previously claimed he always worked by himself but later admitted the type of work being done could not be accomplished by a single person.

He indicated he would secure insurance, which he did prior to court Friday, prosecutors said. In addition to probation, he was ordered to waive his search and seizure rights and to pay $10,000 in fines with $8,000 suspended during the term of probation. The maximum sentence would have been a year in the Monterey County Jail and a fine up to double the premium owed.

En Banc Decision – 100% PD and COLA Starts When TD Ends

In 2005, Warren Brower sustained an industrial injury to his low back, left knee, and psyche while employed as an ironworker foreman,. The WCJ found that Brower’s injury caused temporary total disability from December 20, 2005 through October 6, 2011 and caused permanent total disability (100%). Although under Labor Code section 4656(c)(1)2 applicant’s entitlement to temporary total disability indemnity payments ceased on December 20, 2007 (i.e., after 104 weeks of payment), the WCJ awarded permanent total disability indemnity commencing October 6, 2011, which was when applicant became permanent and stationary. Accordingly, the WCJ’s award resulted in a nearly four year gap between the last payment of temporary total disability indemnity and the first payment of permanent total disability indemnity.

Applicant filed a petition for reconsideration contending that his permanent total disability payments should have commenced as of December 21, 2007 and not October 6, 2011, arguing that pursuant to section 4650(b), permanent total disability payments should commence on the day after the last payment of temporary total disability. Applicant also contends he is entitled to annual cost of living adjustments (COLAs) commencing on January 1, 2008 pursuant to section 4659.

Based on a review of the relevant statutes, regulations, and case law, the WCAB concluded in the en banc decision of Brower v SCIF that

(1) When a defendant stops paying temporary disability indemnity pursuant to LC 4656(c) before an injured worker is determined to be permanent and stationary , the defendant shall commence paying permanent disability indemnity based on a reasonable estimate of the injured worker’s level of PD.
(2) When an injured worker who is receiving PPD payments pursuant to LC 4650(b)(1) becomes permanent and stationary and is determined to be permanently totally disabled, the defendant shall pay PTD indemnity retroactive to the date its statutory obligation to pay temporary disability indemnity terminated.
(3) COLAs begin on the first day in January after an injured worker becomes entitled to receive permanent disability indemnity pursuant to LC 4650(b)(1) or (b)(2).

Effective January 1, 2013, the Legislature amended section 4650(b) in SB 863 to clarify that an employer is not required to commence permanent disability indemnity after the last payment of temporary disability if the employee has returned to work or been offered work at certain wage thresholds. If the employee is eventually awarded permanent disability, “the amount then due shall be calculated from the last date for which temporary disability indemnity was paid, or the date the employee’s disability became permanent and stationary, whichever is earlier.”

Prior to enacting SB 899, the Legislature amended section 4659 to provide that, for injuries occurring on or after January 1, 2003, permanent total disability indemnity payments are increased annually commencing January 1, 2004 in an amount equal to the percentage increase in the state average weekly wage. Prior to the passage of SB 899, the injured worker’s entitlement to temporary disability indemnity terminated when the injured worker either became permanent and stationary or improved sufficiently to return to work. Historically, permanent disability benefits were not payable until the employee had reached permanent and stationary status. SB 899 amended section 4656(c) [now, § 4656(c)(1)] to provide for a 104-week cap on temporary disability. Thus, injured workers like Mr. Brower could remain temporarily disabled after receiving 104 weeks of temporary disability payments and yet not be entitled to collect temporary disability indemnity. Concurrently, the Legislature also amended section 4650(b) [now,§ 4650(b)(1)] to require that permanent disability commence “[w]hen the last payment of temporary disability indemnity has been made pursuant to subdivision (c) of Section 4656.” As amended by SB 899, section 4650 requires a defendant to pay permanent disability indemnity to an applicant who may be temporarily disabled.

LA Probation Officer Arrested for Comp Fraud

A former Los Angeles County probation officer was arrested for allegedly collecting fraudulent workers compensation payments. According to the report in the Los Angeles Times, Robyn Palmer, 29, was arrested on 14 felony counts of insurance fraud, forgery, wire fraud and grand theft after a joint investigation by county probation officials, state Department of Insurance investigators and Allstate Insurance.

Palmer had filed claims and received disability insurance benefits for a shoulder injury she said had occurred in July 2013 while restraining a young inmate at a county juvenile hall. But investigators later found she was not at work on the day the injury allegedly occurred, and there were no employee records of a work-related injury, according to a statement by the probation department. Palmer had collected $29,122 in workers comp payments. Members of a newly created team that investigates workers compensation claims within the probation department audited the claim and noticed the discrepancy in March,.

Palmer was being held at the women’s jail in Lynwood in lieu of $100,000 bail. Probation officials said the case was part of a push to crack down on fraud in the department. A county employee in another department was arrested last month on suspicion of workers compensation fraud. Parks and Recreation Department employee Susette Boggs, 52, allegedly exaggerated the symptoms she experienced after contracting Lyme disease from a tick bite while working at Placerita Canyon Nature Center in Newhall.

State insurance officials said Boggs was found to have maintained “a physically active lifestyle as a drummer/singer in a band since 2007, in direct conflict with symptoms she reported to her physicians about her physical capabilities.” She was alleged to have collected $364,932 more than she was entitled to in disability benefits.

Court of Appeal Rejects Death Benefits in “Special Mission” Case

Lieutenant Seth Patrick Lantz, a 33-year-old correctional officer at Pleasant Valley State Prison in Coalinga, California, was killed in an automobile accident at 6:20 a.m. on Saturday, October 2, 2010 on his way home from work. He lived in the Bakersfield area and commuted to the prison in his own vehicle. The one-way commute was over 85 miles.

Lantz regularly worked 40 hours per week and had Sundays and Mondays as his regular days off. But, on the day of the accident, Lantz worked his regularly assigned shift.and was informed that he would need to “hold over” and serve as the watch commander for the next shift, which ran from 10:00 p.m. to 6:00 a.m. When a replacement watch commander is needed, the procedure used for selecting the replacement has been agreed upon by the Department of Corrections and Rehabilitation (Department) and the officers’ union. Lantz was assigned the hold-over shift as watch commander in accordance with the reverse seniority procedure because no one had volunteered to take the shift. Lantz had served as watch commander before.

While traveling home, Lantz drove his personal vehicle and the only state property he transported to and from work was a protective vest. With regard to commutes in general, Lieutenant Contreras testified that Department employees were not paid for their commuting time, were not required to own personal vehicles, and were not required to wear their uniforms to and from work. In fact, correctional officers were advised to remove or cover the upper part of their uniform when commuting. Lockers at the prison are unassigned and available on a first come, first serve basis. As a result, many correctional officers wear their uniforms to work, but wear something over the shirt during their commute. He died as a result of a fatal accident on his way home after the “hold over” shift.

Lantz’s widow, on behalf of herself and four children (applicants), applied for workers’ compensation benefits, contending that Lantz sustained the fatal injury during the course of his employment. After a trial, Workers’ Compensation Administrative Law Judge Robert K. Norton issued an order that included findings of fact. The first finding stated that Lantz “sustained an injury arising out of and in the course of his employment resulting in his death.”

The State Compensation Insurance Fund (State Fund) filed a petition for reconsideration which was granted. The WCAB rescinded the order and determined that (1) the one-way commute of more than 85 miles traveled by Lantz, while significant, constituted the ordinary, local commute that marked Lantz’s transit to and from work and (2) the change in schedule caused by the second shift did not, by itself, mean the departure time was not fixed. Accordingly, the WCAB concluded that the going and coming rule would control the outcome unless the “special mission” exception applied. The WCAB concluded that it was not extraordinary for Lantz to be held over and required to work a second shift – an occurrence so common that the employer and officers’ union had established official procedures for assigning hold-over shifts. Second, the WCAB indicated that requiring Lantz to act as the watch commander was not extraordinary because it was part of established procedures, the duties performed in that position were similar to his usual responsibilities, and Lantz was among the officers regularly assigned to that position. The WCAB stated the assignment as watch commander increased the number of individuals under his authority, but the activities of the watch commander were not dramatically different from Lantz’s day-to-day obligations. Consequently, the WCAB granted the petition for reconsideration and ordered the substitution of a finding that stated Lantz “did not sustain an injury arising out of and in the course of his employment with defendant, resulting in his death.”

In March 2013, the Court of Appeal issued an order summarily denying applicants’ petition for writ of review. Applicants then filed a petition for review with the California Supreme Court, which was granted with directions for this court to issue a writ of review. Accordingly, the Court of Appeal reviewed the case affirmed the denial of death benefits in the published opinion of Lantz v WCAB The Court concluded that “The Workers’ Compensation Appeals Board (WCAB) denied the application for benefits, determining that the hold-over shift as watch commander was not extraordinary because, among other things, it was assigned in accordance with procedures agreed upon by the prison administration and the officers’ union and did not dramatically change his activities. We conclude the WCAB’s decision involved weighing evidence and choosing among conflicting inferences that could be drawn from that evidence and, therefore, is properly characterized as a finding of fact. Under the standards for judicial review established by the Labor Code, we must uphold the finding of fact that the hold-over shift was not extraordinary because it is supported by substantial evidence. Therefore, the decision of the WCAB denying benefits is affirmed.” .

LAUSD Cop Arrested for Comp Fraud

A former Los Angeles Unified School District police officer, Pedro Plascencia, 48, of Canyon Country, was arrested for workers’ compensation fraud. Plascencia is being charged with presenting a false material statement, concealment, and perjury for attempting to defraud the insurance company by exaggerating the extent of his injuries.

Plascencia allegedly sustained a work-related injury while patrolling the school campus on his patrol bicycle he ran over a wayward cantaloupe and lost control of his bicycle. Plascencia originally claimed injury to his right knee, right foot and right hand, but after obtaining legal counsel he added injury to his back, hips and both knees. Plascencia originally denied any prior medical injury, however subpoenaed medical records indicated that Plascencia, did in fact, sustain prior injuries to those body parts.

Plascencia’s permanent disability finding was changed when the treating doctor was supplied with the medical records reflecting the true injury history. Had the department not stepped in and assisted Plascencia would have unfairly received approximately an additional $15,000 in permanent disability benefits.

“Every year millions of dollars are lost to workers’ compensation fraud,” said Insurance Commissioner Dave Jones. “Plascencia knowingly misrepresented, pertinent and relevant information about his prior medical history during his current workers’ compensation claim. I am thankful that in this case my team of investigators were able to catch the offender quickly before any real damage was done.”

DWC Issues Notice of Hearing for MTUS Regulations

The Division of Workers’ Compensation (DWC) is issuing a notice of public hearing for the Medical Treatment Utilization Schedule (MTUS) regulations. The proposed rulemaking sets forth a framework to determine best practices for providing medical care for work – related illnesses or injuries. A public hearing on the proposed regulations has been scheduled at 10 a.m., July 1, in the auditorium of the Elihu Harris Building, 1515 Clay Street, Oakland, CA 94612. Members of the public may also submit written comment on the regulations until 5 p.m. that day.

The proposed amendments to the MTUS clarify the scientific process by which evidence – based clinical decisions should be made for individuals diagnosed with industrial conditions. The role of the MTUS is clearly established as the standard for the provision of medical care in accordance with Labor Code section 4600. The proposed regulations then set forth the process used to determine reasonable and necessary medical care when the MTUS is silent on a particular medical condition, therapeutic procedure, or diagnostic test or when the MTUS is successfully rebutted pursuant to Labor Code section 4604.5.

The process begins with a medical literature search sequence to guide those making treatment decisions in finding recommendations applicable to the injured worker’s medical condition. The proposed regulations detail how medical evidence shall be evaluated according to an explicit, systematic, strength – of – evidence methodology to determine which recommendation is supported with the best available evidence. Recommendations supported with the best available medical evidence shall be used to determine what is reasonably required to cure or relieve the injured worker from the effects of his or her injury.

Finally, the proposed regulations add two additional members to the Medical Evidence Evaluation Advisory Committee (MEEAC) and address the role and duties of MEEAC.

The proposed changes to the MTUS regulations start with section 9792.20 of Title 8 of the California Code of Regulations.

DWC will consider all public comments, and may modify the proposed regulations for consideration during an additional 15 – day public comment period. The notices of rulemaking, text of the regulations, and the initial statements of reasons can be found on the MTUS rulemaking page .

DIR Reduces Fees for IMR, IBR by 25 Percent

The Department of Industrial Relations (DIR) is pleased to announce a reduction in Independent Medical Review and Independent Bill Review fees effective April 1, 2014. These new fees represent a 25 percent reduction. Parties who submitted an IMR or IBR on or after April 1, 2014 will receive a refund in the amount of fees paid in excess of the new fee schedule.

IMR Fees Any IMR application submitted on or after April 1, 2014 will be subject to the following fee schedule:

Standard IMRs Involving Non-Pharmacy Claims*

Previous Fee: $560 per IMR – Fee Effective April 1, 2014: $420 per IMR

Expedited IMRs Involving Non-Pharmacy Claims

Previous Fee: $685 per IMR – Fee Effective April 1, 2014: $515 per IMR

Standard IMRs Involving Pharmacy Only Claims**

Previous Fee: Not Applicable – Fee Effective April 1, 2014: $390 per IMRs

IMRs Terminated or Dismissed Not Forwarded to a Medical Professional Reviewer:

Previous Fee: $215 per IMR – Fee Effective April 1, 2014: $160 per IMR

IMRs Terminated or Dismissed After Case Forwarded to a Medical Professional Reviewer:

Previous Fee: $560 per IMR – Fee Effective April 1, 2014: $420 per IMR

IBR Fees – Any IBR application submitted on or after April 1, 2014 will be subject to the following fee schedule.

Completed IBR

Previous Fee: $335 per IBR – Fee Effective April 1, 2014: $250 per IBR

Terminated IBR Not Sent to Review***

Previous Fee: $65 per IBR – Fee Effective April 1, 2014: $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.

DWC Schedules Public Hearing on Proposed Copy Service Fee Schedule

The Division of Workers’ Compensation has issued a notice of public hearing for proposed Copy Service Fee Schedule regulations. The public hearing has been scheduled for 10 a.m. Tuesday, July 1 in Room 1 of the Elihu Harris Building, 1515 Clay Street, Oakland, CA 94612. Members of the public may also submit written comments on the regulations until 5 p.m. that day.

“This Copy Service Fee Schedule will reduce litigation and allow providers to submit fee disputes to independent bill review,” says DWC Acting Administrative Director Destie Overpeck. “It will also add clarity regarding allowable services to copy service providers and payers.”

The fee schedule was developed in consultation with the Commission on Health and Safety and Worker’s Compensation (CHSWC). Senate Bill 863 requires DWC to implement a schedule of reasonable maximum fees for copying and related services. The Copy Service Fee Schedule provides for a maximum flat fee of $180 for records up to 500 pages and includes all associated services such as pagination, witness fees, and subpoena preparation. For more than 500 pages, an additional per page fee of 20 cents per page is allowed. Certificates of no record would be payable at a maximum of $100.

Proposed changes include allowing DWC to bill $85 an hour instead of $40 an hour for electronic requests made under the Public Records Act and to charge $1 for CDs of these records. The proposed changes also include an allowance for DWC to dispose of paper adjudication documents after 20 years and replaces deposits required for DWC transcripts with an up-front $150 fee for transcripts of 50 pages and under. For transcripts over 50 pages, an extra $3 per page would be paid before the transcript is released.

The notice and text of the regulations can be found on the proposed regulations page.

WCAB Imposes 5814 Penalties and Attorney Fees for Following “Unreasonable” UR Determination.

Adel Salem sustained an industrial injury to his back and neck in 1978, while employed as a Deputy Sheriff by the County of Riverside. In 1981, he received an award of 45% permanent disability pursuant to Stipulations with Request for Award, together with an award of further medical treatment . Applicant has had four back surgeries between 1981 and 2002. He claimed that the defendant had “suddenly stopped approving all prescribed medications for Mr. Salem in August 2011.” At the time he was under the treatment of Dr. Watkin. and was taking approximately four Norco per day. Watkin reported that it was “inappropriate to just take a person off Norco abruptly.”

The non-certification of continued pain medication refills was explained by the UR physician as follows: “Ongoing and chronic use of a narcotic analgesic is not medically supported for this patient. The patient is essentially at maximum medical improvement and has received benefit from recent cervical epidurals. Given that the patient has had 65-70% improvement following cervical epidurals, there is no ongoing significant pain for which a narcotic analgesic would be necessary. Chronic and long-tern use of narcotic analgesics should be avoided in the chronic phase of treatment given the potential for abuse/addiction. The medical records do not establish moderate to severe pain for which ongoing use of hydrocodone/APAP would be indicated. Therefore, my recommendation is to retrospectively non-certify the request for hydrocodone/acetaminophen.”

Applicant filed a petition for penalties in 2013, alleging that defendant unreasonably denied medical treatment awarded under the 1981 stipulated award, by terminating his long standing prescription for pain medication to treat his ongoing pain symptoms. The workers’ compensation administrative law judge denied applicant’s petition for a penalty pursuant to Labor Code section 5814, finding applicant did not establish that defendant unreasonably delayed or denied his medical treatment by withdrawing authorization for applicant’s narcotic medication, as defendant established a good faith medical dispute based upon its reliance on its Utilization Review (UR) process.

The WCAB granted reconsideration and reversed in the panel decision of Adel Salem v County of Riverside.

The WCAB noted that applicant “has established that defendant delayed the provision of his medical treatment, thus the burden shifts to defendant to establish it had genuine doubt from a medical or legal standpoint to justify its abrupt termination of applicant’s prescribed medication. Defendant has not met this burden.” Applicant had been prescribed pain medication for many years, when defendant decided to seek utilization review of Dr. Roach’s prescription refill for the first time. The UR physician’s non- certification of applicant’s medications did not justify defendant’s abrupt termination, and thus the UR physician’s medical opinion does not constitute substantial evidence upon which defendant could rely to establish a genuine doubt. The MTUS expressly recommends “a slow taper” of opioid medications, which would encompass applicant’s prescription for Norco. “Thus, the record does not contain any evidence to support defendant’s denial of authorization of applicant’s prescriptions for pain medications, and in fact the applicable MTUS standards actually recommended against defendant’s immediate termination of refills. Defendant could not reasonably rely upon the UR physician’s report as a basis to immediately terminate applicant’s prescriptions. Thus, there is no evidence to support a finding that defendant had a genuine doubt from a medical or legal standpoint as to its liability for the continued provision of the narcotic medication prescribed by applicant’s primary treating physician.”

Moreover, as these proceedings were brought to enforce the prior award of medical treatment, the WCAB ruled that applicant’s attorney is entitled to payment of a reasonable attorney’s fee pursuant to Labor Code section 5814.5.

Commissioner Deidra Lowe dissented and indicated she would affirm the WCJ’s determination that the UR de-certification of narcotic prescriptions provided defendant with a genuine doubt as to its liability to continue to authorize the medications.

Study Says Minimally Invasive Spine Fusions Have Better Outcomes

Department of Neurosurgery, Oakland University William Beaumont School of Medicine findings published in the February online issue of Spine shows that patients who have a low back surgery called minimally invasive transforaminal lumbar interbody fusion (MITLIF), end up better off in many ways than patients who have more invasive surgery to alleviate debilitating pain.

Lumbar fusion serves to eliminate abnormal motion and instability while maintaining load-bearing capacity and proper alignment to provide symptomatic treatment for spinal instability, stenosis, spondylolisthesis, and symptomatic degenerative disc disease.1 During the past few decades there has been a dramatic increase in the rates of lumbar fusion procedures in the United States.

For many surgical procedures, the method of choice is shifting from traditional open surgery to minimally invasive techniques. Postoperative histological and imaging studies have demonstrated that conventional open techniques are associated with increased scar tissue formation, significant muscle stripping, and muscle retraction which adversely affect outcomes, and increase reoperation rates. Minimally invasive techniques are performed via a muscle-dilating approach that helps to preserve paraspinal muscular anatomy and bone architecture, and have been shown to diminish iatrogenic soft-tissue injury significantly. Reasons for widespread transition to minimally invasive spine (MIS) techniques include decreased postoperative pain, decreased intraoperative blood loss, shorter postoperative hospital stay, faster return to normal activity, and reduced reoperation rates.

Use of minimally invasive fusion techniques in lieu of traditional open fusion techniques remains a crucible of debate as long-term prospective outcomes in patients undergoing minimally invasive spinal fusion for debilitating back pain has not been well studied. This study was designed to contribute evidence to this debate by reporting long-term, prospectively collected outcomes on 1 of the largest currently available series of minimally invasive transforaminal lumbar interbody fusion (MITLIF) with a minimum follow-up of 24 months, and to determine if adjacent level pathology (ALP) is reduced by preservation of the normal anatomical integrity of the spin

The Beaumont study, led by Dr. Perez-Cruet, found that minimally invasive procedures with smaller incisions can reduce chronic low back pain, hospital stays, complications and scarring. It also can lower costs and infection rates compared with more invasive, open procedures. The seven-year study looked at 304 patients who received the minimally invasive procedure. There were 120 men and 184 women with a mean age of 62.4 years, ranging from 19 to 93 years.

The article concluded that the “MITLIF approach seems to provide both short- and long-term statistically significant outcome improvements in patients experiencing debilitating low back pain. In addition, long-term benefits observed in this study include a reduced rate of adjacent segment disease requiring reoperation while providing high rates of fusion and a low rate of complications. From a clinical prospective these patients show an extremely high rate of satisfaction in the treatment of their chronic back pain disorders. In fact, the majority of these patients are completely pain free and have returned to work or activities of daily living full time. The MITLIF procedure is a highly cost-effective approach for addressing a costly and debilitating medical condition.”