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WCAB Expands Hearing Options with LifeSize Video

The Division of Workers’ Compensation and Workers’ Compensation Appeals Board continue to improve their ability to hold hearings during the COVID-19 pandemic. The following changes are effective August 17.

DWC will continue to hear all mandatory settlement conferences, priority conferences, status conferences, case-in-chief trials, lien conferences and expedited hearings telephonically via the individually assigned judges’ conference lines as announced in newslines issued on April 3, April 28 and May 28.

Beginning August 17, DWC will have a video option available for trials and expedited hearings only. Parties will continue to use individually assigned judges’ conference lines on the day of trial. However, judges will have the option of conducting the trial through the judge’s virtual courtroom if needed. If that is required, the judge will provide a link to the parties allowing them to log into the video platform.

DWC will be using the video platform called LifeSize. Stakeholders should download the software prior to a hearing where a video option may become necessary. Neither DWC nor LifeSize will charge for participants to use the platform.

However, parties will need to have certain system requirements to fully participate in the video option. Parties will also need to have a web camera. Participants without access to a web camera may use a smart phone with the program, although it is not recommended. Additional information on LifeSize and how to use the program may be found on the DWC website.

All parties scheduled for a hearing should continue to call the conference line for the judge in front of whom the case is set, at the designated time listed on the hearing notice. When prompted, the parties should enter the access code assigned to that line. DWC staff will instruct participants as to the procedure to follow during the call.

DWC is in the process of updating its hearing notices to reflect the judges’ conference lines. That change will be implemented on or about August 15.

DWC has also begun hearing Special Adjudication Unit (SAU) lien trials. The same procedure described above will apply for SAU trials.

At this time all other lien trials will be continued. However, DWC anticipates adding lien trials back to the calendar in the near future.

District offices will not hold in-person hearings.

DWC will not accept walk-in filings, walk-through documents or in-person requests at this time. DWC will only accept electronic filing via EAMS and JET File, and paper filing by U.S. mail.

DWC will accept limited email filings pursuant to WCAB’s en banc decision dated April 6 and its newsline issued on April 23. Email filings are limited to documents that are subject to a statute of limitations that cannot otherwise be efiled, JET filed or filed by U.S. mail.

DWC will continue to accept an electronic signature on any settlement documents, applications, pleadings, petitions or motions that are sent to the district offices or filed in EAMS. For all e-forms, parties should utilize “S signature” as shown in the E-forms Filing Reference Guide and the JET File Business Rules.

Injured workers who are unable to file utilizing the available options or need assistance may contact DWC’s call center at 909-383-4522.

The WCAB office in San Francisco is operating with limited in-office staff. The WCAB commissioners and staff continue to work remotely. All practitioners are encouraged to regularly check the WCAB and DWC websites for updates about the district offices’ and the WCAB’s operations during this period.

Daly City Restaurant Resolves Wage Theft Claim for $2.6M

The Labor Commissioner’s Office has reached a $2.6 million settlement with the owners of Kome Japanese Seafood & Buffet in Daly City, securing compensation for 133 workers for unpaid minimum wage, overtime and split shift premiums that were uncovered in a 2018 wage theft investigation. The settlement will also compensate workers for WARN Act violations, which occurred when the restaurant closed without notice.

The Labor Commissioner’s Office in June 2018 issued wage assessments and penalties of $5.16 million to Kome Japanese Seafood & Buffet in Daly City including $4,381,461 for unpaid back wages and $780,400 for penalties. The wage theft violations and civil penalties included failure to pay minimum wage, overtime and split shift premiums. In 2019, the civil penalties were adjusted to $754,950 and the unpaid wages were adjusted to $3,575,433 based on evidence presented prior to hearing.

Notification has been delivered to the current and former restaurant workers of their expected settlement payments and workers began receiving checks this month. The workers are receiving settlement payments ranging from $20 to $47,253 with an average of $14,217 per worker. The settlement also includes $55,000 in civil penalties payable to the state.  

The Labor Commissioner’s Office launched its investigation into Kome Japanese Seafood & Buffet after receiving complaints from workers who reported wage theft. The Labor Commissioner’s Office worked with Asian Americans Advancing Justice – Asian Law Caucus and the Chinese Progressive Association, which represented many of the workers who cooperated in the investigation.

The Department of Industrial Relations’ Division of Labor Standards Enforcement, also known as the California Labor Commissioner’s Office, combats wage theft and unfair competition by investigating allegations of illegal and unfair business practices.

The Labor Commissioner’s Office launched an interdisciplinary outreach campaign, “Reaching Every Californian.” The campaign amplifies basic protections and builds pathways to impacted populations so that workers and employers understand workplace protections, obligations and how to ensure compliance with these laws.

Uber and Lyft Ordered to Classify Drivers as Employees

On May 5, 2020, the Attorney General of California, joined by the City Attorneys of Los Angeles, San Diego, and San Francisco, filed a lawsuit on behalf of the People of the State California seeking injunctive relief, restitution, and penalties against Defendants Uber Technologies and Lyft.

The complaint asserts that Uber and Lyft have misclassified their ride-hailing drivers as independent contractors rather than employees in violation of Assembly Bill 5 , which took effect on January 1, 2020. That statute is intended to ensure that all workers who meet its criteria receive the basic rights and protections guaranteed to employees under California law.

On June 25, the People moved for a preliminary injunction enjoining Defendants from classifying their drivers as independent contractors, and from violating any provisions of the Labor Code, the Unemployment Insurance Code, and the wage orders of the Industrial Welfare Commission with regard to their drivers.

Defendants opposed the motion. They also filed three additional motions: a motion to stay the litigation; a demurrer and motion to strike the complaint; and a motion to compel arbitration.

Defendants sought to stay the litigation until the Ninth Circuit rules on Uber’s pending constitutional challenge to A.B. 5; until the November 2020 election, when the voters will consider Proposition 22, an initiative sponsored by Uber and Lyft that would exempt them from the requirements of A.B. 5; or until the final disposition of numerous lawsuits and arbitrations in which similar claims have been raised.

On August 10, the Court ruled on these pending motions after first declaring that “Defendants are not entitled to an indefinite postponement of their day of reckoning. Their threshold motions are groundless.” The case went downhill for the Uber and Lyft from there.

A footnote also proclaimed that the “Court gives no weight to Defendants’ surveys regarding how many of their drivers wish to become employees or remain self-employed. A. B. 5 may be unpopular among some of Defendants’ drivers, but a lawsuit is not a popularity contest. Nor, as Defendants and some amici curiae argue, is it this Court’ s role to decide whether A.B. S ‘s effects on drivers will outweigh its benefits. Policy judgments underlying a statute are left to the Legislature; the judiciary does not pass on the wisdom of legislation.” (

At the conclusion of the 34 page ruling, it was ordered that “During the pendency of this action, Defendants Uber Technologies, Inc. and Lyft, Inc. are hereby enjoined and restrained from classifying their Drivers as independent contractors in violation of Labor Code section 2570.3 .”

“Defendants are further enjoined and restrained from violating any provisions of the Labor Code, the Unemployment Insurance Code, and the wage orders of the Industrial Welfare Commission with regard to their Drivers.”

This injunction was stayed for a period of 10 days to allow the two companies an opportunity to appeal. Thereafter, “it shall remain in effect through and including the trial of this matter or upon further order of this Court.”

Uber said it planned to file an immediate emergency appeal to block the ruling from going into effect.

Construction Worker Faces Fraud Charges for False Statement

Meliton Hernandez Martinez Jr., 23, was arraigned at the Merced County Superior Court on multiple felony counts of insurance fraud and a misdemeanor count of filing a false police report, after allegedly instigating a physical altercation resulting in stab wounds to his abdomen and arm.

An investigation by the Department of Insurance revealed Martinez was on an approved mid-morning work break while employed with a construction company.

During the break, surveillance footage and witness statements revealed that Martinez made inappropriate gestures to a female in a parking lot and was then confronted by the female’s boyfriend, a former U.S. Marine, who asked Martinez to be respectful.

Surveillance footage revealed Martinez began punching the boyfriend in the face multiple times, without provocation. As a result, Martinez was stabbed in the abdomen and the arm, which was later determined to be self-defense by local law enforcement.

After being airlifted to a local hospital, Martinez filed a workers’ compensation claim with his employer and provided false statements in regards to the incident.

Advantage Workers’ Compensation Insurance Company later denied all medical bills in relation to the claim after discovering Martinez was the initial physical aggressor, and toxicology results revealed Martinez was under the influence of alcohol and cannabis at the time of the altercation.

The Merced County District Attorney’s Office is prosecuting this case.

Man Arrested for Selling Fake COVID Medication

A man and his company have been charged with violating the Federal Food, Drug, and Cosmetic Act (FDCA) by selling a drug claiming to treat COVID-19.

Matthew Ryncarz, and his company, Fusion Health and Vitality, LLC d/b/a/ Pharm Origins, are accused of selling a misbranded drug called “Immune Shot” that they falsely claimed would lower consumer’s risk of contracting COVID-19 by nearly 50 percent, said Bobby L. Christine, U.S. Attorney for the Southern District of Georgia.

In March 2020, during the midst of the global COVID-19 public health crisis, Ryncarz, through his company, Pharm Origins, created a website and began selling “Immune Shot” for $19 a bottle. Among other things, the website represented that “YOU will learn in JUST MINUTES… how to LOWER your risk of COVID-19 by nearly 50%.”

Further, to sell “Immune Shot,” Ryncarz and Pharm Origins targeted individuals, ages 50 and older, with heavy-handed sales pitches, such as “The NEXT FIVE MINUTES could save your life,” “We are offering you the exclusive price of only $19 per bottle because we know that Immune Shot could be the most important formula in the WORLD right now due to the new pandemic,” “Immune Shot is Not a Luxury, It is a Necessity Right Now,” “Point Blank, if YOU Leave, YOU are at Risk,” and “Is Your Life Worth $19? Seriously, Is It?”

Ryncarz and Pharm Origins sold “Immune Shot” to consumers in the Southern District of Georgia and outside of the state of Georgia. The defendants were charged by way of an Information, filed in the U.S. District Court for the Southern District of Georgia. The Information alleges that “Immune Shot” was a misbranded drug within the meaning of 21 U.S.C. § 352(a)(1), in that it bore false and misleading labeling.

U.S. Attorney Christine expressed appreciation to investigators in the U.S. Attorney’s Office, and to David A. Frank, Senior Litigation Counsel with the Department of Justice’s Consumer Protection Branch, Lynn M. Marshall, Associate Chief Counsel for Enforcement, Office of the Chief Counsel, FDA, and to the FBI for their assistance in this prosecution.

“The FBI and our law enforcement partners will not allow anyone to take advantage of our citizens’ fears during a pandemic like COVID-19,” said Chris Hacker, Special Agent in Charge of FBI Atlanta. “It is especially concerning because this alleged scheme targeted citizens who are most vulnerable to the virus.”

Please report COVID-19 fraud to the National Center for Disaster Fraud’s National Hotline at (866) 720-5721, or go to

Conference Call Public Hearing Set for MTUS Update

The Division of Workers’ Compensation (DWC) has issued a notice of conference call public hearing for a proposed evidence-based update to the Medical Treatment Utilization Schedule (MTUS), which can be found at California Code of Regulations, title 8, section 9792.24.6.

The conference call public hearing is scheduled for Thursday, September 10, at 10 a.m. and members of the public may attend by calling 866-390-1828 and using access code 5497535#. Members of the public may review and comment on the proposed updates no later than September 10.

The proposed evidence-based update to the MTUS incorporate by reference the latest published guideline from American College of Occupational and Environmental Medicine (ACOEM) for the following:

Antiemetics Guideline (ACOEM March 27, 2020)

An antiemetic is a drug that is effective against vomiting and nausea. Antiemetics are typically used to treat motion sickness and the side effects of opioid analgesics, general anaesthetics, and chemotherapy directed against cancer. They may be used for severe cases of gastroenteritis, especially if the patient is dehydrated.

The proposed evidence-based update to the MTUS regulations are exempt from Labor Code sections 5307.3 and 5307.4 and the rulemaking provisions of the Administrative Procedure Act.

However, DWC is required under Labor Code section 5307.27 to have a 30-day public comment period, hold a public hearing, respond to all the comments received during the public comment period and publish the order adopting the update online.

Surgical Specialties Fees Reduced in 2021 Medicare Fee Schedule

The Centers for Medicare & Medicaid Services announced the proposed calendar year 2021 updates for the Medicare Physician Fee Schedule. The Official Medical Fee Schedule for the California worker’s compensation system correlates with Medicare fees. Hence the announced changes will have implications in the workers’ compensation industry.

The press release began by highlighting changes the Trump administration was making to expand permanently the telehealth benefits that Medicare beneficiaries have begun receiving during the COVID-19 pandemic, and then discussed changes it was making to the fee schedule — specifically to the paperwork requirements for evaluation and management (E/M) codes that doctors use to bill for office visits.

“The Trump administration has taken steps to eliminate burdensome billing and coding requirements for Evaluation and Management visits that make up 20% of the spending under the Physician Fee Schedule,” the release noted. “These billing and documentation requirements for E/M codes were established 20 years ago and have been subject to longstanding criticism from clinicians that they do not reflect current care practices and needs.”

“After extensive stakeholder collaboration with the American Medical Association and others, simplified coding and billing requirements for E/M visits will go into effect January 1, 2021, saving clinicians 2.3 million hours per year in burden reduction,” CMS said. “As a result of this change, clinicians will be able to make better use of their time and restore the doctor-patient relationship by spending less time on documenting visits and more time on treating their patients.”

The proposed rule lists (on p. 897) the estimated impacts of the rule’s payment changes for each specialty, which included losers as well as winners.

Three specialties fare the best: endocrinology, with a 17% increase; rheumatology, with a 16% increase; and hematology/oncology, with a 14% increase. At the bottom are nurse anesthetists and radiologists, both with an 11% decrease; chiropractors, with a 10% decrease; and interventional radiology, pathology, physical and occupational therapy, and cardiac surgery, all with a 9% decrease.

Surgical specialties in general took some of the biggest hits, with cuts in every category ranging from 5% to 9%.

The proposed rule also lists the fee schedule’s final conversion factor — the amount that Medicare’s relative value units (RVUs) are multiplied by to arrive at a reimbursement for a particular service or procedure under Medicare’s fee-for-service system. Due to budget neutrality changes required by law, the proposed 2021 conversion factor is $32.26, a decrease of $3.83 from the 2020 conversion factor of $36.09, CMS said.

And not everyone is happy with these changes. “Under the proposal, neurosurgeons face overall payment cuts of at least 7% at a time when the nation’s healthcare system is already stressed by the COVID-19 pandemic,” said a joint statement from the American Association of Neurological Surgeons (AANS) and the Congress of Neurological Surgeons (CNS). “The reductions are primarily driven by new Medicare payment policies for office and outpatient visits that CMS will implement on January 1, 2021. Drastic cuts caused by changes to these visit codes … will undermine patient access to neurosurgical care.”

Safeway Store Janitors Protest Limited COVID-19 Safety Gear

Citing the risk of contracting COVID-19 at their workplaces, Palo Alto Online reports that a group of janitors who clean Safeway stores across the Bay Area protested in Palo Alto on Thursday to demand safeguards for their health and financial security.

About 80-100 people showed up for an “Essential Workers Caravan” to show support for the contract employees, said Jane Martin, an organizer for Service Employees International Union, United Services Workers West (SEIU-USWW), which represents the janitors at the center of Thursday’s action. The workers, many of whom are Latino, are in some cases supporting family members who have lost their jobs due to the economic shutdown, she said.

Ten janitors contracted to work in northern California Safeway stores have tested positive of COVID-19, according to the union, which represents more than 20,000 janitors statewide.

When the clients come into the stores, everything is clean because of us,” janitor Jesus Barrios said in Spanish. Barrios, who lives and works in Contra Costa County, took part in the protest with his daughters, Guadalupe and Susana.

“We are essential workers and we run the risk of contracting the virus. We deserve higher wages because we are at high risk,” he said.

The caravan began at a parking lot along West Bayshore Road, near U.S. Highway 101, and drove to the Midtown Safeway on Middlefield Road, where the procession circled around the parking lot. Many participants decorated their cars and tied balloons to their vehicles.

The group is calling on Safeway to add $2 to contracted janitors’ hourly wage, which Martin called “hazard pay.” That amount is currently offered to janitors who have been directly hired by the supermarket chain rather than by contract.

The added compensation would recognize the dangers janitors face at their workplaces, where the employees often work night shifts after the grocery stores close to disinfect surfaces and clean bathrooms before customers return the following day, she said.

Most janitors are paid $16.20 an hour, a rate that will be renegotiated later this year, according to SEIU-USWW bargaining director Mark Sharwood. Most also benefit from paid family health coverage, up to 50 cents an hour in pension benefits, five days of paid sick leave, six paid holidays, four weeks of paid vacation and paid funeral leave.

Contracted janitors are also looking to receive adequate supplies of personal protective equipment, said Martin, who recalled speaking to a janitor who said his store supplies workers with face masks but at times faces a shortage of gloves.

The group also made calls for the passage of the Health and Economic Recovery Omnibus Emergency Solutions Act (HEROES Act), a $3 trillion federal package that would issue a second round of stimulus checks and extend a $600 weekly payment for the unemployed. The legislation gained the House’s approval in May and awaits a vote from the U.S. Senate.

Thursday’s protest ended at the Stanford Oval to raise awareness of the university’s contracted janitors who have stopped receiving compensation since mid-June due to the shutdown. In April, the university announced it would continue pay and benefits for contracted service workers through June 15 amid pressure from the campus community.

AbbVie Resolves CDI Insurance Fraud Act Claim for $24M

The California Department of Insurance announced a settlement agreement with AbbVie Inc. to resolve a lawsuit alleging violations of the California Insurance Frauds Prevention Act involving the marketing of blockbuster prescription drug HUMIRA.

AbbVie agreed to reform its HUMIRA marketing practices in California, including disclosing that registered nurses employed as “Ambassadors” to interact with patients about HUMIRA are actually paid by the company, not a medical provider, and reforming how HUMIRA is marketed to health care providers.

In addition, as provided for in the Act, AbbVie has also paid a combined $24 million to the State of California and the whistleblower who brought the case to the Department’s attention.

In October 2016, the Department began an investigation into AbbVie after recieving a whistleblower case filed by a registered nurse who was employed as an AbbVie Ambassador in Florida.

After its investigation, the Department intervened in that case and filed a Superseding Complaint alleging that whistleblower violated California’s Insurance Frauds Prevention Act. Among other things, the Department alleged that AbbVie violated the Act by unlawfully providing free and valuable professional goods and services to physicians to induce and reward AbbVie prescriptions.

The Department alleged that Nurse Ambassadors interfered with the flow of doctor-patient communications and did not directly answer questions pertaining to AbbVie marketing activities constituted kickbacks in violation of the Act, including, for example, the provision of meals and drinks to providers outside the context of speakers programs.

While AbbVie continues to deny the allegations, as a part of the settlement, AbbVie agreed to reforms, including:

— Ambassadors will disclose to patients that they are provided by AbbVie and do not work under the direction of the patient’s health care provider.
— The company will implement a policy modification prohibiting HUMIRA sales representatives from inviting HUMIRA prescribing health care providers to offsite business meals, except as part of the AbbVie speaker programs.
— AbbVie will provide patients with the U.S. FDA-approved HUMIRA medication guide and Ambassadors will direct patients to the medication guide and their health care provider regarding side effects and safety risk.
— The company will provide guidance and training that Ambassadors shall not have patient-specific discussions with providers who prescribe AbbVie.
— AbbVie employees will be prohibited from describing Ambassadors to health care providers as “extensions of their offices” and from providing to providers any contact information for Ambassadors who interact with HUMIRA patients.
— AbbVie employees and Ambassadors will not actively participate in conversations between patients and insurance companies.

The complete list of AbbVie’s business practice reforms can be found in the settlement.

Liberty Mutual Reports $320M Q2 Loss from COVID-19

Liberty Mutual Holdings Co. reported a $320 million net loss in the second quarter of 2020 compared with a $397 million profit in the same period last year largely due to event cancellation losses from COVID-19, natural catastrophes and civil unrest, the insurer reported Thursday.

The net loss was the result of significant impacts from the COVID-19 pandemic and consequent economic downturn as well as above average catastrophe losses, said David H. Long, Liberty Mutual Chairman and Chief Executive Officer.

The largest driver of the COVID-19 impact was event cancellation product line, which contributed approximately 9 points,” said Dennis Langwell, executive vice president and president of Liberty’s global risk solutions segment, on the earnings call. He attributed about $100 million to property-related losses and expected litigation costs and about $260 million to contingent lines event cancellation.

Incurred losses for COVID-19 amounted to $529 million in the quarter, with roughly half of these losses related to event cancellation. Based on our size and industry footprint, these losses fall within its expectations for an event of this magnitude.

The insurer has “seen some losses come in but not a lot” for coronavirus-related workers compensation losses, Mr. Langwell said.

But this isn’t over – we don’t know how workers compensation will play out for additional exposures in subsequent periods,” he said. “We expect the impact of COVID-19 coupled with the low interest rate environment – to be a catalyst for more meaningful rate increase in workers compensation going forward.”

Mr. Langwell said the insurer applied exclusions for pandemics to event cancelation policies beginning in January 2020 and estimates that it could see about $50 million related to additional event cancelations in 2021.

Catastrophe losses of $878 million were up $384 million from the prior year quarter and resulted primarily from a high frequency of severe storm activity and include $147 million of losses related to civil unrest.

On the investment side, realized gains from the sale of fixed maturities were more than offset by losses in its partnership portfolio, which are booked on a quarter lag. Liberty Mutual’s investment income declined to $144 million in the second quarter from $1.37 billion in the same quarter in 2019, according to the insurer’s financial analysis.

Liberty Mutual reported revenue of $10.17 billion for the second quarter, a 5.7% dip in from the same quarter 2019.

In the global retail markets segment, which includes personal and small U.S. business lines, net written premium declined 5.7% in the second quarter 2020 to $6.86 million, but the combined ratio held almost steady at 98.9%.