Category: Daily News

The California Chamber of Commerce has released its annual Job Killer list, which includes 28 bills that would harm California’s economic growth and job creation should they become law. “These bills represent some of the worst policy proposals affecting California employers and our economy currently being considered by Legislature,” said CalChamber President Allan Zaremberg. Of the 28 bills on this list, those of most concern to employers include:

— AB 51 (Gonzalez; D-San Diego) Ban on Arbitration Agreements – Significantly expands employment litigation and increases costs for employers and employees by banning arbitration agreements made as a condition of employment, which is likely preempted under the Federal Arbitration Act and will only delay the resolution of claims.
— AB 628 (Bonta; D-Oakland) Uncapped New Leave of Absence for Employees and Their Family Members – Significantly expands the definition of sexual harassment under the Labor Code, which is different than the definition in the Government Code, leading to inconsistent implementation of anti-harassment policies, confusion, and litigation. Also, provides an unprecedented, uncapped leave of absence for victims of sexual harassment and their “family members” which is broadly defined.
— AB 673 (Carrillo; D-Los Angeles) Unfair Expansion of Penalties Against an Employer for Alleged Wage Violation – Unfairly exposes an employer to being penalized twice for the same violation, by allowing both an employee and the Labor Commissioner to recover the same civil penalties through civil litigation.
— AB 882 (McCarty; D-Sacramento) Limitation on Ability to Maintain a Safe Workplace. Significantly undermines an employer’s ability to maintain a safe, drug-free workplace, by prohibiting an employer from discharging an employee who has tested positive for a drug that is being used for medical purposes.
— AB 1468 (McCarty; D-Sacramento/Gallagher; R-Yuba City) Targeted Tax on Opioids – Unfairly imposes an excise tax on opioid distributors in California, which will increase their costs and force them to adopt measures that include reducing workforce and increasing drug prices for ill patients who need these medications the most, in order to fund drug prevention and rehabilitation programs that will benefit all of California.
— SB 37 (Skinner; D-Berkeley) Staggering Corporate Tax Hike – For certain companies, SB 37 would raise California’s corporate tax rate – already one of the highest in the nation – up to a staggering 22.26%, which amounts to an increase of about 150% and which will undoubtedly discourage companies from locating or further investing in the state.
— SB 135 (Jackson; D-Santa Barbara) Substantial Expansion of California Family Rights Act – Significantly harms small employers in California with as few as 5 employees by requiring these employers to provide 12 weeks of a protected leave of absence each year, in addition to existing leaves of absences already required, as well as potentially requiring larger employers to provide 10 months of protected leave, with the exposure to costly litigation for any alleged violation.
— SB 567 (Caballero; D-Salinas) Expands Costly Presumption of Injury – Significantly increases workers’ compensation costs for public and private hospitals by presuming certain diseases and injuries are caused by the workplace and establishes an extremely concerning precedent for expanding presumptions into the private sector.

CalChamber will periodically release job killer watch updates as legislation changes. Reporters are encouraged to track the current status of the job killer bills

A small group of medical experts quietly advise U.S. health insurers on new drugs. These relatively unknown expert committees have been involved in drug coverage decisions for decades. Their members’ identities are kept secret due to federal regulations aimed at preventing pharmaceutical industry interference.

But, according to Reuters Health, their power has grown more recently with the consolidation of most of the U.S. pharmacy benefits business under OptumRx, CVS and Express Scripts. Taken together, their three advisory committees now guide drug coverage for more than 90 million Americans.

Pharmacy and therapeutics (P&T) committees also hold sway over record numbers of novel and expensive medicines introduced into the U.S. market each year, more often with less evidence of effectiveness or safety than in the past.

New drugs that may fall under their scrutiny in the next year include potentially life-saving therapies for spinal muscular atrophy and Duchenne muscular dystrophy as well as oral treatments for migraine, diabetes and multiple sclerosis.

Their decisions have new consequences as the pharmacy benefits companies they advise are more likely to exclude a new treatment from coverage if it is deemed on par with existing therapies. Or they can demand discounts – or rebates – from drugmakers in exchange for the coverage.

“If the committee says (a treatment) is no better than the existing drug, there is a very decent possibility that it might get a less preferred status or not be included” for reimbursement, said Jack Hoadley, a health policy expert at Georgetown University.

Market and regulatory changes in the last 10 years, as well as the Affordable Care Act, have resulted in significant modifications to health care delivery models. Traditionally, P&T committees limited the impact of their decisions to the populations associated with their hospital or health plan/

However, as hospitals have begun to transform into larger health systems and even integrated payer organizations, P&T committees must consider both inpatient and outpatient needs of patients in multiple hospitals and ambulatory care settings.

The function of the P&T committee has not necessarily changed, but its scope has expanded. Considerations of quality, cost (reimbursement), and access (accreditation) affecting P&T committees over the past decade will become even more important as new drugs and biotech therapies enter the market and the shortage of primary care physicians intensifies.

Pharmacists, physical therapists, nurses, and physicians are assuming new leadership responsibilities, making them partners with P&T committees in improving clinical care and cost performance for health systems.

The Federal Trade Commission sued the health information company Surescripts, alleging that the company employed illegal vertical and horizontal restraints in order to maintain its monopolies over two electronic prescribing, or “e-prescribing,” markets: routing and eligibility.

The FTC’s complaint against Surescripts, filed in federal court on April 17, 2019, is the latest example of the agency’s commitment to stopping anticompetitive tactics in the health care industry that raise the cost of care.

In February, the FTC reached a a global settlement with the pharmaceutical manufacturer Teva Pharmaceuticals Industries Ltd., barring the company from engaging in reverse-payment patent settlement agreements that block consumers’ access to lower-priced generic drugs.

Last month, the Commission barred another pharmaceutical company, Impax Laboratories LLC, from entering into reverse-payment patent settlements after concluding that Impax used this tactic to block consumers’ access to a generic version of the extended-release opioid pain reliever Opana ER.

And in a record court victory for the Commission last year, a federal court ordered another pharmaceutical company, AbbVie Inc., to pay $448 million to consumers who overpaid for testosterone replacement drug Androgel because of AbbVie’s illegal tactics to maintain its monopoly over the drug.

In the complaint filed on April 17, 2019 against Surescripts, the FTC is seeking to undo and prevent Surescripts’s unfair methods of competition, restore competition, and provide monetary redress to consumers.

“For the past decade, Surescripts has used a series of anticompetitive contracts throughout the e-prescribing industry to eliminate competition and keep out competitors,” said Bureau of Competition Director Bruce Hoffman. “Surescripts’s illegal contracts denied customers and, ultimately, patients, the benefits of competition – including lower prices, increased output, thriving innovation, higher quality, and more customer choice. Through this litigation, we hope to eliminate the anticompetitive conduct, open the relevant markets to competition, and redress the harm that Surescripts’s conduct has caused.”

E-prescribing provides a safer, more accurate, and lower-cost means to communicate and process patient prescriptions than traditional paper prescribing. According to the complaint, Surescripts monopolized two separate markets for e-prescription services:

— The market for routing e-prescriptions, which uses technology that enables health care providers to send electronic prescriptions directly to pharmacies;
— The market for determining eligibility, a separate service that enables health care providers to electronically determine patients’ eligibility for prescription coverage through access to insurance coverage and benefits information, usually through a pharmacy benefit manager.

The FTC alleges that Surescripts intentionally set out to keep e-prescription routing and eligibility customers on both sides of each market from using additional platforms (a practice known as multihoming) using anticompetitive exclusivity agreements, threats, and other exclusionary tactics. Among other things, the FTC alleges that Surescripts took steps to increase the costs of routing and eligibility multihoming through loyalty and exclusivity contracts.

According to the FTC’s complaint, Surescripts successfully used these tactics to stop multiple attempts by other companies to enhance competition in the routing and eligibility markets. According to the FTC’s complaint, Surescripts’s anticompetitive tactics thwarted competitors from gaining share in the routing and eligibility markets, enabling the company to maintain at least a 95 percent share in each market over many years. The complaint alleges that Surescripts succeeded in maintaining its monopolies in routing and eligibility, despite the explosive growth of routing and eligibility transactions – from nearly 70 million routing transactions in 2008 to more than 1.7 billion in 2017.        

The Workers’ Compensation Insurance Rating Bureau of California (WCIRB) has released its Early Indicators of High-Risk Opioid Use and Potential Alternative Treatments study report. The study compares characteristics of claims involving high levels of opioid use to claims with similar injury mix and injured worker age that involved only a lower dose of opioids.

Since 2012, the use of opioids has significantly and continuously declined in the California workers’ compensation system. The share of claims with at least one opioid prescription 12 months after the injury decreased from 42% of all claims that had any drug prescription in the same time frame in 2013 to 20% in 2017. In 2017, the average cost of opioid prescriptions per 100 claims was down by almost 80% from 2013. The precipitous reduction in opioid prescriptions has contributed to a lower level of overall pharmaceutical use in the workers’ compensation system.

The downward trend of opioid prescriptions may be leading to a shift in the patterns of medical treatments for California’s injured workers. This potential shift could also result in more utilization of alternative measures in place of high levels of opioid use. Therefore, early identification of injured workers who may be using high doses of opioids and thus experiencing more adverse effects of opioids could facilitate early provision of alternative treatments and also help identify key system cost drivers.

— About 2.5 percent of all Accident Year 2013 (AY2013) claims with any opioid prescription involved high-risk opioid use within 12 months of the date of the injury compared with 1.4 percent of AY2016 claims.
— High-risk opioid use claims incurred significantly higher medical and indemnity costs than similar lower-dose use claims, and they tended to remain open longer.
— High-risk opioid use claims were much more likely to involve permanent disability benefits than similar lower-dose claims.
— During the first six months of treatment, the number of opioid prescriptions per AY2013 claim was 50 percent lower on lower-dose use claims compared to the similar high-risk claims, contributing to 50 percent lower total drug payments per claim.
— Early indicators of high-risk opioid use include obtaining similar opioids from multiple dispensers, having overlapping opioid prescriptions, using extended-release/long-acting opioids and concurrently using opioids and benzodiazepines.
— Physical therapy, acupuncture and chiropractic services – as well as nonsteroidal anti-inflammatory drugs and non-narcotics – were used significantly more on similar lower-dose use claims than on high-risk use claims.

The full study report is available in the Research section of the WCIRB website.

Miguel Pena claimed injury to the head, neck, back, shoulders and psyche. The employer disputed injury to his psyche, but not to the other body parts pied. An award found applicant needed future medical care, but did not decide AOE-COE to the psyche.

Later a psychological PQME diagnosed major depression, pain disorder and cognitive disorder that was 100% industrially-based. Future treatment recommendations were made for treatment.

Pena requested authorization for treatment with Dr. Lorant,.a secondary treater for psyche. Defendant responded asking “if there has been an RFA for sessions with Dr. Lorant..”

In response, applicant filed a Declaration of Readiness to Proceed on the issue of treatment for his psyche, as well as a Petition for Penalties under section 5814 and attorney’s fees under section 5814.5.

The issues at trial included injury AOE/COE to the psyche, a penalty for failure to promptly provide or authorize medical care to the psyche and fees under section 5814;5 if a penalty is assessed.

The WCJ found an unreasonable delay in authorizing medical care, and assessed a penalty of 25% of the first visit with Dr. Lorant, and found that applicant’s attorney was entitled to fees under section 5814.5 in an amount to be adjusted between the parties. The F&A did not contain a finding of fact regarding injury AOE/COE to applicant’s psyche. After reconsideration, a WCAB panel agreed with the penalty, and a split panel disagreed with the attorney fee award in the case of Pena v Agua Systems. Commissioner Sweeney wrote a dissenting Opinion.

Applicant’s psychiatric condition was found to be industrially caused by the PQME and treatment was recommended. The record does not reflect that defendant raised any issues with the PQME conclusions or attempted to conduct discovery to challenge those conclusions prior to or during the trial.

The record therefore does not support genuine doubt by defendant from a medical or legal standpoint for liability for benefits in relation to applicant’s psychiatric condition. Once applicant requested treatment for his psychiatric condition per his July 6, 2018 request, defendant was obligated to provide it.

Defendant fails to cite any authority for its contention that the mere selection of a physician to provide medical treatment itself constitutes a RF A for a “specific course of proposed medical treatment” subject to UR. There is no specific course of treatment being proposed by applicant’s selection of Dr. Lorant as a secondary treater; this is simply a request for an opportunity to be seen by a psychiatrist who can then report to applicant’s primary treating physician (PTP) on what treatment, if any, is necessary to cure or relieve from the effects of applicant’s psychiatric condition.

But fees under 5814.5 are only permissible where applicant has incurred fees in specifically enforcing a prior award. That did not occur here. There was no prior award for treatment to applicant’s psyche at the time of the trial.

In other words, the second trial was not conducted to enforce a prior award so there can be no award for attorney’s fees under section 5814.5.