Category: Daily News

A new panel decision of Perez v Comprehensive Blood and Cancer Center -(ADJ 11965696)- the WCAB was required to discuss an analysis of the correct “date of injury” in a continuous trauma case, as well as the correct period for “imposition of liability” upon the industrial carriers. In this case the carrier (unsuccessfully) attempted to raise several theories that would shift liability to a period either before or after the last date of employment ending July 3, 2012.

Mericela Perez was thirty-five years old and employed as a Radiology Technician at Bakersfield, California by Comprehensive Blood and Cancer Center, during the period ending on July 3, 2012. It was found that she sustained injury in the form of an intracranial meningioma. The Opinion on Decision indicates that the WCJ believed the date of injury to be to be January 16, 2020, the date of the first report from David Baum, M.D., the internal medicine panel qualified medical examiner (PQME).

The panel pointed out that the date of injury for cumulative trauma claims “is that date upon which the employee first suffered disability therefrom and either knew, or in the exercise of reasonable diligence should have known, that such disability was caused by his present or prior employment.” (Lab. Code,1 § 5412.)

In turn, liability for a cumulative injury is determined under section 5500.5, which states that liability “shall be limited to those employers who employed the employee during a period . . . [of one year] immediately preceding either the date of injury, as determined pursuant to Section 5412, or the last date on which the employee was employed in an occupation exposing him or her to the hazards of the occupational disease or cumulative injury, whichever occurs first.

Although the period of liability for cumulative trauma claims is limited to the last year of injurious exposure, the actual date of injury under section 5412 may be different than applicant’s last date of work.

“Pursuant to section 5412, the date of a cumulative injury is the date the employee first suffers a ‘disability’ and has reason to know the disability is work related.” (Western Growers Ins. Co. v. Workers’ Comp. Appeals Bd. (Austin) (1993) 16 Cal.App.4th 227, 238 [58 Cal.Comp.Cases 323].) This is the date that sets the benefit rates, and timing and availability of benefits.

Disability has been defined as “an impairment of bodily functions which results in the impairment of earnings capacity.” (J.T. Thorp v. Workers’ Comp. Appeals Bd. (1984) 153 Cal.App.3d 327, 336 [49 Cal.Comp.Cases 224].)

Disability can be either temporary or permanent. (Chavira v. Workers’ Comp. Appeals Bd. (1991) 253 Cal.App.3d 463, 474 [56 Cal.Comp.Cases 631].) Whether there is temporary or permanent disability indicating the date of cumulative injury is a question of fact, which must be supported by substantial evidence. (Austin, supra, 16 Cal.App.4th at 233-235.)

Here the applicant filed an Application for Adjudication of Claim seeking benefits for industrial injury on February 22, 2019. Her date of knowledge is no later than the date of the application which was filed.

However, Dr. Baum stated that: “The carcinogenic potential of ionizing radiation is additive. The exposure at the podiatrist’s office, I believe, initiated the process which eventuated the meningioma 15 years later – hastened by 6 years of more intense exposure as an assistant radiation therapist at CBCC.”

Therefore, the last year of injurious occupational exposure ending on July 3, 2012 predates the section 5412 date of injury. “While defendant attempts to raise several alternative theories that would shift liability to a period either before or after the year ending July 3, 2012,” and the panel said that they “cites to no evidence in the record in support” of this assertion.”

Late last year, Mitchell, Genex and Coventry announced the creation of their new parent brand, Enlyte. This combination under the new Enlyte brand creates an organization in the Property & Casualty industry with technology innovation, clinical services and network solutions.

And Enlyte just released it’s new report on 2022 predictions for the workers’ compensation sector.

As we enter 2022 still mired in the COVID-19 pandemic, the workers’ compensation industry faces another challenging year, with payers continuing to cope with staffing shortages, evolving regulatory changes and more.

The Report is broken down into the following topics.

– – Staffing shortages throughout the country will affect a wide range of employers; insurance carriers and other claim organizations are facing this challenge as well. To reduce the risk associated with high turnover rates and onboarding new employees who have less industry experience than their predecessors, we anticipate the insurance industry will turn to technology, especially automation, to help fill some of the gaps.

– – The Mental Health Conversation Will Continue. Studies have shown the likelihood of injured employees being treated for depression are 45% greater than non-injured counterparts. And getting hurt on the job can increase the risk of mental hardship. “Having access to behavioral health specialists in workers’ compensation is no longer a ‘nice to have’ it’s a ‘must have’.”

– – Automation, Claims Staff Efficiency Will Be at the Forefront. As workers’ compensation payers continue to navigate challenges they are facing due to COVID-19, Enlyte anticipates many companies will focus on boosting claim staff efficiency through automation, outsourcing, technology and other tools in 2022.

– – The Pandemic Will Continue to Strain Hospitals, Providers. Shortages, combined with burnout among clinicians worn down by nearly two years of operating in full-time triage mode, limit the ability of some hospitals to offer the best care possible. Already, some non-urgent surgeries and other essential services are being postponed to accommodate COVID-19 patients.

– – Federal Regulatory and Legislative Changes Will Trickle Down to Workers’ Compensation. This year, the federal government will undertake major discussions on health-related topics including telemedicine and marijuana, that could have significant effects for the workers’ compensation industry.

– – The Regulatory Landscape Will Continue to Shift. In addition to the major initiatives happening at the federal level, there are a few other top-of-mind issue for 2022. While COVID-19-related regulatory changes, such as presumptions and vaccine mandates, will continue to take precedence, many state legislatures are playing catchup on the initiatives they had on the docket ahead of the pandemic.

– – Drug Price Transparency Will Be a Focus; Opioid and Addiction Concerns Will Continue. High-impact and specialty pharmaceuticals, drug-price transparency and regulation/price pressure, as well as continuing concerns around opioids and addiction, are just a few issues that will impact workers’ comp this year.

Details and embellishment of these topics can be obtained by reading the full Report on the Enlyte website.

California’s push to create the country’s first single-payer health care system dissolved quietly late Monday as the bill’s progressive author nixed a scheduled vote due to a presumed lack of support in the heavily Democratic state Assembly.

According to the report in Courthouse News, Assemblyman Ash Kalra acknowledged he was unable to wrangle enough votes before a key legislative deadline, citing “substantial misinformation” from a group of well-funded opponents. Nonetheless, Kalra claimed there’s still a viable path to universal health care in the nation’s most populous state, even though he couldn’t secure a majority vote in a chamber dominated by members of his own party.

“Despite heavy opposition and substantial misinformation from those that stand to profit from our current health care system, we were able to ignite a realistic and achievable path toward single-payer and bring Assembly Bill 1400 to the floor of the Assembly,” Kalra said in a statement.  “However, it became clear that we did not have the votes necessary for passage and I decided the best course of action is to not put AB 1400 for a vote today.”

Though voters rejected a universal health care initiative in 1994 and lawmakers most recently snubbed the idea in 2017 due to a lack of funding, the single-payer vision has leapt back into the Golden State’s political agenda.

Coined the “Guaranteed Health Care for All Act,” AB 1400 proposed a single-payer program to be administered and overseen by a new state agency known as CalCare. Kalra, D-San Jose, reintroduced the bill this month and two committees quickly signed off, setting up a presumed showdown on the Assembly floor.

Supporters, including the California Nurses Association and cities like San Jose, Sacramento and Long Beach, jumped behind the effort. In support letters, newspaper editorials and committee testimonies, the proponents said the switch to universal health care would trim existing administrative costs, coalesce the state’s buying power and reduce labor union strikes that often stem from disputes over health care benefits.

As was the case with recent single-payer attempts, the daunting price tag likely derailed the latest version.

According to the most recent estimates, adopting single-payer could cost between $314 and $391 billion annually. Further, if the federal government signs off and contributes to California’s transformation, the state will have to come up with at least $158 billion to launch AB 1400.

To help fund the transition, supporters proposed raising taxes on businesses and residents through an accompanying ballot measure. They said the tax hikes paled in comparison to the over $400 billion Californians currently spend on health care and that single-payer would save the state money in the long run.

But a coalition of critics consisting of hospital groups, insurers and the GOP lined up to fight the idea of government-run health care, casting it as the “largest tax increase in state history.”

Adding to the intrigue was whether Governor Gavin Newsom would get behind the single-payer push or the corresponding tax hike during an election year. Pundits predict several tight congressional races and expect California to factor heavily into who takes control of the House in 2023.

Newsom, who promised to pursue a single-payer system on the campaign trail in 2018, declined to endorse AB 1400 at this early stage in the legislative process. Instead, the former San Francisco mayor has introduced drastically cheaper plans to extend subsidized health coverage to all residents regardless of immigration status.

By abandoning Monday’s vote, Kalra freed Assembly Democrats – and Governor Gavin Newsom – from having to take a formal position on the polarizing topic in an election year.

The CEO of several Southern California-based medical imaging companies was sentenced today to 60 months in federal prison for running a scheme that submitted more than $250 million in fraudulent claims through the California Workers’ Compensation System for medical services procured through bribes and kickbacks to physicians and others.

40 year old Sam Sarkis Solakyan, who lives in Glendale, was sentenced and also ordered him to pay $27,937,175 in restitution to the victim insurers. She also banned him from working in the health care and workers compensation industries for his three-year term of supervised release once he completes his prison sentence.

During an eight-day trial that concluded on July 2, a jury found Solakyan guilty of one count of conspiracy to commit honest services mail fraud and health care fraud, and 11 counts of honest services mail fraud.

Federal prosecutors had sought more than 15 years in prison for Solakyan.

“Despite overwhelming evidence of his criminality and the myriad fraudulent and unnecessary services that he generated, defendant refused to accept such responsibility and instead proceeded to trial, where he obstructed justice by testifying falsely time and again,” lawyers for the Justice Department said in their sentencing memorandum.

“[Solakyan] paid some $9 million in kickbacks in order to generate over $250 million in fraudulent medical billings, the vast majority of which were for MRIs [magnetic resource images] that were…..totally medically unnecessary,” prosecutors wrote in a sentencing memorandum. “[Solakyan] devised, and through his kickbacks fueled, a cross-referral scheme that incentivized [co-conspirators] to herd patients to physicians who overprescribed ancillary services in exchange for cash and other economic benefits.”

In their sentencing request, his lawyers had asked for a prison term of no more than six months. They said that Solakyan had come with his family to California as refugees from Armenia when he was a boy and had become the main provider for his family by the time he was 17.

His lawyers also cited Solakyan’s trauma for sexual abuse as a child, his mental health issues, marital problems and his drug addiction in their request for leniency.

Solakyan was the CEO of several medical-imaging companies, including the Glendale-based Vital Imaging Inc., and San Diego MRI Institute. Solakyan operated diagnostic imaging facilities throughout California, including the Bay Area, Los Angeles and Orange counties, and San Diego.

From no later than mid-2013 to November 2016, Solakyan conspired with physicians and others to perpetrate a scheme in which physicians were paid bribes and kickbacks in exchange for the referral of workers’ compensation patients. The compensation offered to the corrupt doctors consisted of either cash or referrals of new patients in what is known as a “cross-referral” scheme.

The conspirators obscured the true nature of their financial relationships to conceal the bribes and kickbacks, including by entering into various sham agreements such as contracts for “marketing,” “administrative services,” and “scheduling,” when in fact the money Solakyan paid amounted to volume-based, per- magnetic resonance imaging (MRI) scan bribes and kickbacks to induce physicians to refer and continue referring patients to Solakyan’s companies.

Solakyan’s recruiters required physicians to refer a minimum number of patients to receive “cross-referrals,” and those referrals stopped if the physicians failed to meet the minimum quota. Solakyan paid more than $8.6 million in kickbacks disguised largely as sham “scheduling” fees in exchange for MRI referrals, payments which were concealed from patients and health insurers.

In total, Solakyan submitted and caused to be submitted more than $250 million in claims for medical services procured through the payment of bribes and kickbacks.

Wei Wen Wu, 54, and Feng Wen Lam, 49, both of Arcadia, are charged with 43 felony counts of insurance fraud, grand theft, and conspiracy after allegedly under reporting nearly $4.5 million in employee payroll.

The scheme fraudulently reduced their company’s workers’ compensation insurance premium resulting in a loss of approximately $1.7 million in unpaid insurance premiums.

A parallel investigation by the California Department of Industrial Relations (DIR) uncovered significant wage theft from employees at the couple’s chicken processing business in El Monte.

Lam is the owner of Golden Food Inc. (GFI), a chicken processing business employing butchers and meatpackers located in El Monte, which receives chicken carcasses and breaks them down into boxes of chicken parts for sale. Lam’s husband, Wu, operated the business.

The Department of Insurance launched an investigation after receiving a referral from State Compensation Insurance Fund, who suspected the business of fraud after comparing the payroll reported during annual audits with the payroll reported to the Employment Development Department.

After obtaining search warrants for GFI, the Department was able to obtain the true payroll records from the company’s computer and found fake tax reporting forms.

The investigation revealed between 2015 and 2021, GFI under reported its payroll to its workers’ compensation insurance carriers by $4,489,390, resulting in a loss of $1,681,138 in unpaid insurance premiums to four insurance companies, including State Fund.

In addition to the Department of Insurance investigation, the California Department of Industrial Relations investigation found employees were forced to clock out for breaks and continue to work, they were not paid overtime for work in excess of 40 weekly hours, and their pay stubs were falsified.

Also, it revealed Wu routinely deducted work hours from employees and falsely counted that pay as bonus. An audit by DIR found that Lam and Wu failed to pay at minimum $437,542 in labor to their 34 employees based on the minimum legal market value.

Additional victims of wage theft are encouraged to contact the California Labor Commissioner Office’s Criminal Investigator Eduardo Martinez at 818-901-5305 or the Labor Commissioner’s Office’s Public Information Line at 1-833-526-4636 or dlse2@dir.ca.gov.

Wu and Lam are scheduled to appear in court on March 29, 2022, in Department 30 of Foltz Criminal Justice Center. The Los Angeles County District Attorney’s Office’s Healthcare Fraud Division is prosecuting this case.