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California High On National List of Comp Cost Increases – Again!

The National Academy of Social Insurance has issued its16th annual report on national workers’ compensation benefits, coverage, and costs. This report presents new data on workers’ compensation programs for 2011 and updates estimates for 2007 – 2010 with newly available data. The revised estimates in this report replace estimates in the Academy’s prior reports.

In 2011 workers’ compensation programs managed by the 50 states, the District of Columbia, and the federal government paid $60.2 billion in benefits, an increase of 3.5 percent from the $58.2 billion in benefits paid in 2010. In 2011 medical payments to providers increased by 4.5 percent, to $29.9 billion, and cash benefits to injured workers increased by 2.6 percent, to $30.3 billion. Costs to employers rose by 7.1 percent in 2011, to $77.1 billion. In 2011 workers’ compensation covered an estimated 125.8 million workers, an increase of 1.1 percent from the previous year. Aggregate wages of covered workers increased by 3.9 percent.

All states showed increases in both numbers of covered workers and dollars of covered wages in 2011.

In 2011, the total amount of benefits paid to injured workers increased in 29 jurisdictions and decreased in 22. The largest percentage increases in benefits occurred in Virginia (12.5%), Iowa (12.2%) and New York (10.7%). California had the sixth highest percentage increase in the nation at 8.4% . The largest percentage decreases in benefits occurred in Nevada (-11.3%), Oregon (-10.1%) and New Hampshire (-9.6%). Between 2010 and 2011,

Employers’ costs of workers’ compensation per $100 of covered payroll increased in 35 jurisdictions, and declined in sixteen. The largest increases were in Wisconsin (14 cents), Wyoming (14 cents), Iowa and Washington (13 cents). California had the 9th highest increase in the nation for 2011 at 8 cents increase per $100 of covered payroll.. Some of the largest decreases were in West Virginia, Montana, and Ohio.

Study Says Patients Confused About Post Hospitalization Care

Patients may think they understand everything doctors tell them when they are released from the hospital, but a new U.S. study summarized by Reuters Health found several gaps in what they remember and areas where instructions could be clearer. Out of nearly 400 patients discharged from a large academic medical center, 96 percent reported knowing why they had been hospitalized, but only about 60 percent could accurately describe their diagnoses, for instance. “Patients were very positive, but when we asked them about actual facts, they could not tell us,” said Dr. Leora Horwitz, the study’s lead author from the Yale School of Medicine in New Haven, Connecticut.

For the new study, Horwitz and her colleagues asked 395 people age 65 and older about their experience after being discharged from Yale-New Haven Hospital between May 2009 and April 2010. They compared those patients’ responses to what was written in their medical charts and the instructions they were given when they were released.

The majority received instructions that included easy-to-understand language about what symptoms to watch out for and advice about activities and diet, but about a quarter of the instructions used medical jargon to explain the patient’s medical condition. For example, instead of saying the person had a “heart attack,” the instructions used the technical term “myocardial infarction.” About 35 percent of patients had trouble explaining why they were in the hospital. What’s more, about half of the patients recalled their doctor having scheduled a follow up visit while the medical records showed only about 33 percent actually had one scheduled. Also, less than one third of patients reported being told while hospitalized about their upcoming discharge more than a day in advance. Two-thirds of patients did recall being asked whether they would have the support they needed at home after discharge.

Hospitals are currently looking at ways to reduce the number of people who have to come back for additional care – something the U.S. government and economists say can be prevented to reduce overall healthcare spending. For people on Medicare, the government-run health insurance program for the elderly and disabled, hospital readmissions increase spending by an estimated $26 billion per year, according to federal figures. About $17 billion of that is thought to be potentially preventable. Much focus has been put on hospitals following recommended medical guidelines to reduce readmissions, though there is also some attention toward making sure patients know what to do after they leave the hospital.

Copy of Prescriptions No Longer Required With Pharmacy Bills

SB 863 created several new requirements for medical service providers when seeking reimbursement. This included the provision of a copy of a prescription for pharmaceutical services. After the passage of SB 863, several stakeholders reached out to the Legislature regarding the challenges of this requirement. Specifically, proponents note that there is no electronic method to transmit a paper prescription, and that the use of paper prescriptions is becoming increasingly rare. Additionally, some stakeholders have noted that other states have used electronic prescriptions, rather than paper prescriptions, as a method for combating opioid abuse.

Proponents of this new law noted that the Division of Workers Compensation’s electronic billing standard for pharmacy bills does not currently support the inclusion of attachments, making pharmacy billers unable to comply. Proponents also argue that a list of billed components provides the same information as prescription for pharmaceutical drugs, and that the requirement of a prescription may impact a pharmacy’s ability to fill workers’ compensation prescriptions, limiting access to medically necessary medication.

The California legislature has passed, and Governor Brown has signed SB146 which amends labor code section 4602.3. to correct these problems. S.B.146 was enacted as an “urgency statute” and thus it is effective immediately.

This new law (1) provides that a copy of a prescription for pharmaceutical services is not necessary unless the provider of services has entered into a written agreement, as specified, that requires a copy of the prescription for a pharmacy service;(2) allows an employer, pharmacy benefits manager, insurer, or third-party claims administrator to request a copy of the prescription during a review of any records of prescription drugs dispensed by a pharmacy; and, (3) provides that any entity submitting a pharmacy bill for payment, on or after January 1, 2013, and denied payment for not including a copy of the prescription from the treating physician, shall have until March 31, 2014 to resubmit those bills for payment.

Claimant with Attendant Care Sentenced in Fraud Case

A San Diego father and daughter team were sentenced to local custody after pleading guilty to insurance fraud, grand theft and perjury in connection with a brazen insurance fraud scheme that lasted nine years. Yolandi Kohrumel, 35, was sentenced to one year in jail and her father, Anton Buitendag, 65, was sentenced to 180 days in jail by Superior Court Judge Duane Moring. Restitution in the amount of $1,558,653 was also ordered to be paid to ESIS, which administered the insurance claim.

Kohrumel broke her toe at work and claimed to be wheelchair bound due to complications from surgery on her foot. The defendant was paid $1.5 million in disability payments over a nine-year period until the insurance company was tipped off and obtained video of her standing, walking and lifting moving boxes for hours.

In 2002, Kohrumel worked as a manager at Staples. After working about three months, she claimed she injured her toe when a heavy box fell on her foot. In November of that year, she had surgery on her toe and was given crutches. When she claimed she could not use the crutches, she was given a wheelchair. The defendant claimed the wheelchair gave her carpal tunnel syndrome and she was given an electric wheelchair.

Despite this, she continued to represent herself as suffering from hypersensitivity of the feet, complex regional pain syndrome, depression, and anxiety. Doctors prescribed about 25 different medications for these symptoms. From the date of the surgery to the present, Kohrumel never returned to work and was paid temporary disability amounting to two-thirds of her salary, tax free.

She represented herself as needing care 24 hours a day, seven days a week since 2004. At first, care was provided by her husband until his death in September of 2011. Then, the defendant’s father, Anton Buitendag, took over her care. All of Kohrumel’s doctors believed she was totally disabled, entitling her to potential lifetime disability benefits. Given her young age, this could have totaled several million dollars.

Recently, Kohrumel and her father began demanding that he be reimbursed for the around-the-clock care they said she needed and he provided. Buitendag was seeking $324,000 in compensation for his claimed 24 hour-a-day, seven days a week care of his daughter from September 2011 through June 2013. He claimed his services were worth more than $21 an hour, which came to about $500 per day or about $182,500 a year.

The insurance company, ESIS/AIG, disputed the amount of care she needed and said they could not legally pay Buitendag because he is a South African citizen and does not have a work Visa. Kohrumel’s attorney sought to litigate this issue before the WCAB.

In addition to the benefits the defendant received, she said needed a larger place to live as her current two bedroom apartment was not large enough for her wheelchair to navigate. The insurance company hired movers to help her start the moving process and informed the workers they would have to do everything as Kohrumel was wheelchair bound. While helping Korhumel, the movers noticed she would get out of her wheelchair for extended periods of time and lift and move heavy boxes in her garage. The movers reported what they saw to the insurance company and later filmed the defendant standing for about two hours while continuously lifting, moving and looking through boxes in her garage. Korhumel was arrested and taken into custody.

On July 10, 2013, a search warrant was executed on Korhumel’s garage and more than 20 boxes of unused prescription medication were recovered. The next day both Kohrumel and Buitendag entered guilty pleas. Korhumel pleaded guilty to eight felonies counts including insurance fraud, preparing a false document, perjury and grand theft. Butiendag pleaded guilty to three felony counts of attempted grand theft.

Another “Politically Incorrect” Comp Claim

The public eye and caustic scrutiny moves quickly to claims of industrial injury made by workers who are perceived by the public or the press to be “politically incorrect.” Last week the press was hard on John Pike, a former U.S. Marine with 17 years of law enforcement experience, who gained worldwide notoriety after he pepper-sprayed seated, unarmed Occupy UC Davis protesters who blocked police on a Quad sidewalk on Nov. 18, 2011. Pike applied for worker’s compensation, claiming he suffered psychiatric injury from the 2011 confrontation. Protesters threatened to picket the WCAB district office where his August MSC was to be held. The parties took the MSC off calendar to circumvent the planned protest.

This week the focus is on the tale of Henry Alvarez’s departure from the imploding San Francisco Housing Authority. When Alvarez went on paid medical leave back in February, before being fired in April, he took heat for setting up a restaurant in Berkeley while presumably too ill to do his day job as the executive director for the city’s public housing agency.

Now it turns out that Alvarez has filed a workers’ compensation claim contending he was injured from stress on the job – his full-time one at the Housing Authority, according to new stories. He is seeking disability payments, health care and a voucher worth up to $10,000 for job training. Alvarez contends that he was injured on Jan. 29, records show. That’s four days after he requested his leave of absence for “personal reasons” and indicated he would not seek to renew his contract, which expired in June.

The story in the San Francisco Chronicle characterizes his claim as “laced with irony.”

Alvarez filed the claim April 26, about two weeks after he was fired amid mounting concern about his leadership of the public housing agency, which was about to run out of money, was rated one of the two worst in the state, and was the subject of a federal probe into its contracting practices. The Housing Authority was also defending itself against lawsuits from three former employees, including two who said they were discriminated against for taking paternity or disability leave.

In one case, Beverly Bernell Myres, a workers’ compensation analyst with the Housing Authority, said she was fired while out on disability leave with a knee injury. Her lawsuit alleges Alvarez asked in a meeting, “How can the workers’ comp person be out on workers’ comp?” He also allegedly “made derisive comments” about her disability, the suit says. “We find it the height of hypocrisy that after an extensive record of saying that anyone who takes workers’ comp is a malingerer and a fraud, Mr. Alvarez then files for it,” said Heidi Machen, Myres’ attorney.

DWC Schedules Public Hearing on MPN Regulations

The Division of Workers’ Compensation (DWC) is issuing a notice of public hearing for the Medical Provider Network (MPN) regulations. The proposed rulemaking is to implement Senate Bill 863’s changes to Medical Provider Networks. A public hearing on the proposed regulations has been scheduled at 10 a.m., September 30, 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 MPN regulations modify regulatory definitions, which include a definition of an entity that provides physician network services. The regulations also detail the changes to MPN plan requirements, which include physician acknowledgments, Internet postings of providers, medical access assistants, quality of care, geocoding and MPN disclosure requirements to medical providers. In addition, the regulations set the requirements for MPN approval for a period of four years and the procedural timelines for MPN re-approval.

Regarding compliance and enforcement, the proposed regulations set forth the process for filing a written complaint against an MPN, and the manner to petition DWC for the suspension or revocation of MPN status. Finally, the regulations detail more enforcement actions, establishing additional grounds for the probation, suspension, or revocation of an MPN, and the procedure by which MPNs are reviewed by the Division and assessed administrative penalties.

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 MPN rulemaking page.

EK Health Moves to Larger Facility

San Jose-based EK Health Services Inc., a national workers’ compensation managed care company, has opened its locally based national medical bill review services office in a new, larger site.

Formerly operating at 2081 Arena Blvd. in Sacramento, the local office now comprises 10,000 square feet at 6970 Destiny Drive in Rocklin.

“We reached capacity in our previous location and lacked room for future expansion of staff and services,” said Kerri Lierman, EK Health’s operations vice president.

Employee of Ventura County Sheriff Pleads Guilty in Fraud Case

A Santa Paula woman who worked for the Ventura County Sheriff’s Office has pleaded guilty to four felony counts of workers’ compensation insurance fraud, prosecutors said Wednesday.

Keri Atwood (DOB 09/24/1984), of Santa Paula, entered guilty pleas to four felony counts of workers’ compensation insurance fraud. Michael Atwood (DOB 08/2811976), also of Santa Paula, entered a guilty plea to one felony count of conspiracy to commit workers’ compensation fraud. The case was investigated by the Valencia office of the California Department of Insurance.

Defendant Keri Atwood reported to her supervisors that she sustained an injury to her left ankle. She said the injury occurred when another employee accidentally hit the back of her foot with a mail cart. She was placed on Temporary Total Disability (TTD) status. Over the next several months, Atwood remained on TTD and received over $29,000 in disability pay.

Keri Atwood used crutches or a wheel chair to get to her medical appointments. After her medical appointments, she was seen walking freely without the aid of crutches or a wheel chair. She was also observed engaging in a number of physical activities that she told her treating her physicians she could not perform. Michael Atwood drove Keri Atwood to her doctors’ visits and failed to disclose her true physical condition.

Final SB 863 Interpreter Regulations Now in Effect

The Office of Administrative Law has approved the DWC final version of interpreter services regulations, one of the sections that implemented major reform provisions of Senate Bill 863. The interpreter services regulations went into effect on August 13. The final version of the interpreter services regulations differs from the emergency regulations as follows:

The regulations specify different standards for interpreters based on where services are provided. The first standard applies to interpreters providing services at a hearing, deposition or arbitration; while the second set applies for those interpreting for a medical appointment or medical legal exam.

Interpreting at a hearing, deposition or arbitration:
Interpreters must be certified or provisionally certified to qualify to be paid for interpreter services at a hearing, deposition or arbitration. Names of certified interpreters are listed on the State Personnel Board webpage or the California Courts webpage.

Provisional certification indicates that the individual has been deemed qualified to perform interpreter services when a certified interpreter cannot be present. Provisional certification is made by agreement of the parties, based on a finding by the workers’ compensation administrative law judge conducting a hearing that the individual is qualified to interpret at the hearing, or by an arbitrator conducting an arbitration that the interpreter is qualified to interpret at the arbitration.

Interpreting for a medical appointment or medical legal exam:
Interpreters must be certified, certified for medical treatment appointments or medical legal exams, or provisionally certified in order to be paid for interpreter services at a medical treatment appointment or medical legal exam.

Certified interpreters’ names are listed on the State Personnel Board webpage or the California Courts webpage.

Interpreters certified for medical treatment appointments or medical legal exams qualify through successfully passing the Certification Commission for Healthcare Interpreters (CCHI) exam or by passing the National Board of Certification for Medical Interpreters (National Board). A CCHI certification or credential indicates the name of the interpreter and the language for which he or she is certified to provide interpreter services. The certification procedure is detailed on the CCHI website. CCHI credentials are valid for four years and specify the language the interpreter for which the interpreter is certified. The National Board certification is valid for five years.

Interpreters can also be provisionally certified as an interpreter in this category is the claims administrator has given prior written consent to the interpreter providing services or if the injured worker requires interpreter services in a language other than Spanish, Tagalog, Arabic, Cantonese, Japanese, Korean, Portuguese, and Vietnamese. In this case, the physician may use a provisionally certified interpreter if the record of the medical evaluation documents the need and the language required

Interpreter directories are maintained as follows:
–  Certified interpreters are listed at on the State Personnel Board webpage or the California Courts webpage;
–  Certified interpreters for the purposes of medical treatment appointments and medical legal exams are listed in the registry for Certification Commission for Healthcare Interpreters (CCHI) or National Board of Certification for Medical Interpreters (National Board).

Proof of certification may be requested by the claims administrator and shall be provided by the certified interpreter for the purposes of medical treatment appointments and medical legal exams if the interpreter is not listed on the CCHI or National Board website directory.

Interpreter services FAQs with additional information on the new regulations are posted here.

Supreme Court Sets Oral Arguments in Valdez Case

The California Supreme Court has agreed to review the controversial Court of Appeal decision that allowed unauthorized non-MPN physician reports into evidence. The Court has scheduled oral argument for Wednesday, September 4, 2013, at 9:00 a.m., in San Francisco.

After Elayne Valdez filed a claim for industrial injury, the employer admitted her claim to most of the alleged body parts injured and she was sent for medical treatment to the employer’s MPN, where she was seen by Dr. Nagamoto, who treated her from approximately October 9, 2009 to October 31, 2009. Applicant then began treating with Dr. Nario, a non-MPN physician, upon referral from her attorney.

The WCAB in a split en banc decision ruled that non MPN physician reports are not admissible when the employer has properly complied with MPN regulations. The WCAB reasoned that Labor Code 4616.6 provides: “No additional examinations shall be ordered by the appeals board and no other reports shall be admissible to resolve any controversy arising out of this article” and thus precludes the admissibility of non-MPN medical reports with respect to disputed treatment and diagnosis issues, i.e., “any controversy arising out of this article.”

The Court of Appeal reversed and remanded in the unpublished opinion of Elayne Valdez v WCAB and Warehouse Demo Services

In ruling that non MPN reports are indeed admissible, the Court reasoned that “It does not makes sense, however, to construe section 4616.6 as a general rule of exclusion, barring any use of medical reports other than those generated by MPN physicians. Section 4616.6 states nothing of the sort. If the Legislature intended to exclude all non-MPN medical reports, the Legislature could have said so; it did not.”

Recently enacted S.B. 863 partially addressed this outcome. Effective 1/1/2013 LC 4605 provides that “Any report prepared by consulting or attending physicians pursuant to this section shall not be the sole basis of an award of compensation. A qualified medical evaluator or authorized treating physician shall address any report procured pursuant to this section and shall indicate whether he or she agrees or disagrees with the findings or opinions stated in the report, and shall identify the bases for this opinion.”