Author: WorkCompAcademy

CFO.com reports that nine states have seen significant workers’ compensation reform bills signed into law in 2013. Oklahoma’s workers’ compensation reform laws have received the most attention lately because of the inclusion of an opt-out provision, known as the Oklahoma Option. The Oklahoma Option is significantly different from the Texas opt-out option. Employers that opt out in Texas cannot simply endorse their excess liability policy to cover Oklahoma. Rather, employers in Oklahoma that choose the option are required to provide a written benefit plan that serves as a replacement for the workers’ compensation coverage. This benefit plan must provide for full replacement of all indemnity benefits offered in the workers’ compensation system. The key component of the Oklahoma Option for employers is that it gives them full control of the medical treatment through their benefits plan. Unlike the Texas opt-out, the Oklahoma Option does not permit employees to pursue a negligence action through the civil courts.

The recently passed reform bill in Delaware was designed to control medical costs and encourage return-to-work efforts.

The use of physician-dispensed medication has been a significant issue in Florida workers’ compensation. Physicians were charging several times what the same medication would cost from a retail pharmacy, and the costs were not regulated by a fee schedule. New law creates a maximum reimbursement rate for physician-dispensed medication of 112.5% of the average wholesale price, plus an $8 dispensing fee.

Legislation passed in Georgia should have a positive impact on workers’ compensation costs for employers. Effective July 1, 2013, medical benefits for non-catastrophic cases are capped at 400 weeks from the date of accident, whereas previously, injured workers were entitled to lifetime medical benefits for all claims.In Indiana, legislation was passed that establishes a hospital fee schedule at 200% of Medicare rates. This is consistent with other states that base their fee schedules on Medicare rates.

Minnesota joined most other states in amending its statutes to allow for mental-mental injuries (a psychiatric disorder without a physical injury).

Missouri’s reforms were focused on addressing the insolvent second injury fund and returning occupational disease claims to the workers’ compensation system.

Recent legislative changes in New York will reduce employer costs by about $800 million annually. These savings are derived primarily by streamlining the assessment collection process and eliminating the 25-a fund and its associated assessments. New York’s workers’ compensation assessments are the highest in the nation, so employers welcome any relief in this area.

Tennessee and Oklahoma both moved its workers’ compensation dispute resolution process from a court-based system to an administrative system, leaving Alabama as the only state that still uses the trial courts for all such litigation.

In the first effort of its kind, the nonprofit publisher of Consumer Reports magazine released ratings of 2,463 U.S. hospitals in all 50 states on Wednesday, based on the quality of surgical care. The group used two measures: the percentage of Medicare patients who died in the hospital during or after their surgery, and the percentage who stayed in the hospital longer than expected based on standards of care for their condition. Both are indicators of complications and overall quality of care, said Dr John Santa, medical director of Consumer Reports Health.

According to the story in Reuters Health, the ratings will surely ignite debate, especially since many nationally renowned hospitals earned only mediocre ratings. The Cleveland Clinic, some Mayo Clinic hospitals in Minnesota, and Johns Hopkins Hospital in Baltimore, for instance, rated no better than midway between “better” and “worse” on the CU scale, worse than many small hospitals. Because CU had only limited access to data, the ratings also underline the difficulty patients have finding objective information on the quality of care at a given facility.

Nevertheless, “this is a step in the right direction,” said Paul Levy, former president of Beth Israel Deaconess Medical Center in Boston, who was not involved in the project. “To whatever extent you can empower patients to get better care and become partners in pushing the healthcare system to make improvements is to the good.”

CU’s ratings are based on Medicare claims and clinical records data from 2009 to 2011 for 86 kinds of surgery, including back operations, knee and hip replacements, and angioplasty. The rates are adjusted to account for the fact that some hospitals treat older or sicker patients, and exclude data on patients who were transferred from other hospitals. These are often difficult cases that, CU felt, should not be counted against the receiving hospital.

Although the ratings do not explicitly incorporate complications such as infections, heart attacks, strokes, or other problems after surgery, the length-of-stay data captures those problems, said Santa.

Some of the findings are counterintuitive. Many teaching hospitals, widely regarded as pinnacles of excellence and usually found at the top of rankings like those of U.S. News and World Report, fell in the middle of the pack.

“This isn’t the first time we’ve seen this sort of surprise,” said Dr Marty Makary, a surgeon at Johns Hopkins Hospital and author of the 2012 book, “Unaccountable: What Hospitals Won’t Tell You and How Transparency Can Revolutionize Health Care.” “For a complex procedure you’re probably better off at a well-known academic hospital, but for many common operations less-known, smaller hospitals have mastered the procedures and may do even better” with post-surgical care.

CU also found that several urban hospitals did well despite serving many poorer, sicker patients, including Mount Sinai Hospital in New York and University Hospitals Case Medical Center in Cleveland. Rural hospitals did better, on average, than other hospitals, and many hospitals practically unknown beyond their zip code outranked famous ones, including Kenmore Mercy near Buffalo, New York; Arrowhead in Glendale, Arizona; Sacramento Medical Center in California; and Arkansas Heart in Little Rock.

Angelotti Chiropractic, Mooney and Shamsbod Chiropractic, Christina-Arana and Associates, Joyce Altman Interpreters, Scandoc Imaging and Buena Vista Medical Services filed a lawsuit yesterday in the United States District Court, Central District of California seeking to avoid payment of millions of dollars in lien activation fees before the end of 2013. The Defendants are Edmund G. Brown (Governor), Kamala D. Harris (Attorney General), Christine Baker (DIR Director), Ronnie Caplane (WCAB Chair) and Destie Overpeck (DWC Acting Director)

The suit requests declaratory, injunctive and other relief and challenges the constitutionality of certain provisions of SB 863 that retroactively impose a $100 “activation” fee on workers’ compensation liens filed prior to January 1, 2013. Plaintiffs allege that they filed valid liens prior to December 31, 2013 that constitute “vested property rights.” They allege that the mandatory dismissal provisions of the activation fee law interfere with those rights.

The Plaintiffs also complain that other “large holders of workers’ compensation liens are arbitrarily exempted from the fee” such as insurance companies, HMOs and labor union benefit plans. Thus they say that SB 863 “specifically targets independent providers of services to workers’ compensation claimants and was adopted with the purpose of destroying their liens.”

Thus, they allege that these “provisions of SB863 are unconstitutional under the Takings, Due Process and Equal Protection Clauses of the United States Constitution. Accordingly, this action seeks preliminary and permanent injunction preventing Defendants from enforcing these provisions of SB863.”

Christina Arana and Associates Inc. holds approximately 4,500 liens, Joyce Altman Interpreters, Inc. holds approximately 4,745 liens, Sandoc Imaging Inc. holds approximately 2,300 liens and Buena Vista Medical Services Inc. allege they hold approximately 20,888 liens. In total Plaintiffs allege they hold “tens of thousands of liens” which require activation fees in an amount of “more than $2 million” and the Plaintiffs allege they presently lack the ability to pay the lien activation fees.

The complaint will now be served on the defendants, who will likely demur the complaint. This will test the legal validity of the Plaintiff’s’ constitutional theories before a federal judge. After that step, should they survive the demurrer, it is likely that the case will be submitted by way of the summary judgment process inasmuch as there are no substantial disputes as to the facts. This case will move rapidly through the federal system, at least at the trial level.

John Pike, the former police officer who pepper-sprayed students during an Occupy protest at the University of California, Davis is applying for worker’s compensation, claiming he suffered psychiatric injury from the 2011 confrontation.

Pike has a settlement conference set for Aug. 13 in Sacramento, according to the state Department of Industrial Relations’ website. Organizers are already planning a demonstration outside the state building in the hopes of urging the WCAB to reject the former cop’s claim. “It’s so outrageous,” Protest Organizer Bernie Goldsmith said. “While he might be entitled to receive workers compensation, the idea that his own actions of brutality would entitle him to a payout is absolutely unjust. It’s crazy.”

Pike was fired in July 2012, eight months after a task force investigation found that his action was unwarranted. Online videos of him and another officer casually dousing demonstrators with pepper spray went viral, sparking outrage at UC Davis leaders. The images became a rallying symbol for the Occupy Wall Street movement.

Hackers posted Pike’s information online. The former Marine sergeant received scores of threats that led an Alameda County Court judge to rule against releasing the names of other officers at the scene.

This week, a state appeals court ruled news organizations are entitled to know the names of a dozen University of California police officers who were interviewed about the use of pepper spray on demonstrators at UC Davis. The Los Angeles Times and The Sacramento Bee are seeking the officers’ identities, which were redacted from two reports on the incident.

In the aftermath, the University of California agreed to pay $1 million to settle a lawsuit filed by demonstrators and the chief of the UC Davis police department resigned. Ian Lee was one of the protesters pepper-sprayed. He and about 20 others shared in a million-dollar settlement. The college junior hopes Pike’s claim is denied. “It’s wrong what he’s trying to do,” Lee said. “When you reward people like Pike by giving them benefits, you tell people it’s okay to hurt students. That’s the message we absolutely cannot send.”

United States Attorney Laura E. Duffy announced that veteran Leray Shurn was sentenced to serve two years in federal prison by United States District Court Judge Thomas J. Whelan for running a landscaping business while claiming worker’s compensation and unemployment benefits from the Department of the Navy and Department of Veterans Affairs to which he was not entitled. Judge Whelan also ordered Shurn to pay $357,977 in restitution and a $5,000 fine. Shurn’s fraud spanned more than five years and cheated two U.S. government agencies out of over $350,000.

According to evidence presented during trial, Shurn falsely represented to the Navy and VA that back and later knee injuries prevented him from working as a Navy civilian employee, and that he was not engaged in any employment where he received payment of any kind, was not self-employed, was not involved in any business enterprises, and did not have an ownership interest in any business enterprises. He also falsely claimed that his disability prevented him from being able to obtain employment.

In January 2013, a jury returned guilty verdicts on all 16 counts of fraud (5 counts of mail fraud, 4 counts of wire fraud, 5 counts of fraud to obtain federal employee’s compensation, and 2 counts of false statements to the VA). During the trial, the jury heard and saw evidence, including video recordings, that Shurn operated a landscaping business in which he personally performed landscaping work for numerous customers, provided customers with his business card for “Leray’s Landscaping” as well as monthly invoices, and represented to landscaping suppliers that he was in the landscaping business. The jury also received evidence that while Shurn was concealing his landscaping business from the Navy and VA, he completed a survey in which he indicated that he was a business owner.

United States Attorney Duffy added, “During these difficult budgetary times, submission of fraudulent claims harms our community and government agencies by diverting financial resources away from those with legitimate claims who are most in need of benefits payments and prevents agencies from funding other priorities.”