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Obamacare Open Enrollment Brings Higher Costs

The technology glitches may be a thing of the past. But people shopping online for health insurance plans under Obama’s healthcare law may encounter a new set of problems early next week, one of them being unexpected new costs. HealthCare.gov, the federal website where people enroll for insurance under the Affordable Care Act, opens for sign-ups for policies covering 2015 this Saturday, the so-called open enrollment period.

The site launched for the first time a year ago but tech snafus made it virtually unuseable for weeks, giving plenty of ammunition for critics of the 2010 law that aimed to make healthcare more affordable for millions of Americans. The website is now much improved, but many consumers may find themselves early in the new year beset by higher costs, unexpected demands for return of subsidies and double-billings.

According to the report in Reuters News, Insurance industry officials, congressional aides and analysts say potential problems will mainly affect current Obamacare policyholders and could intensify public hostility toward the law, just as Republicans – long opposed to the law – take over as a majority in the U.S. Senate in January. The Nov. 15-Feb. 15 open enrollment period allows qualified Americans to obtain private health coverage, often with federally subsidized premiums. Premiums overall appear stable, although some existing plans may rise in price and newer policies may offer consumers better terms.

But there is concern about how smoothly the administration will handle the some 5.9 million 2014 policyholders expected to re-enroll. Some experts say the challenge of re-enrolling millions while adding millions of newcomers could be behind this week’s sharp reduction in official enrollment forecasts for 2015. An estimated 4.4 million people could opt simply to have their policies renewed automatically by Dec. 15, according to the consulting firm Avalere. But many of those could wind up with unexpectedly higher costs as insurers raise premiums on existing policies, experts say.

Even those who actively hunt for cheaper plans could still face issues. Some consumers who cancel existing coverage could initially be billed twice – once for each plan – because the government has no automated system for notifying insurers of such changes, said one insurance industry official, speaking on condition of anonymity.    

And policyholders who got subsidies to help pay for 2014 coverage could also be told to return some of that money, if their incomes rose later in the year and they did not notify the government.

WCAB Panel Says Failure to Notify by Fax or Telephone Invalidates UR

Kimberly Rivera injured her back while working for Valley Radiology in 2010. Dr. Norman Kahan is the primary treating physician.

On June 13, 2013, Dr. Kahan issued a request for authorization (RFA) requesting acupuncture and medications (Flexeril, Norco, Neurontin, Terocin and a Theramine medical supplement). The parties dispute the date that defendant received the RFA. Applicant claims July 5, 2013 and defendant claims July 8, 2013. The UR non-certification is dated on 07/16/2013, yet it indicates a determination date of 07/15/2013, and has a proof of service date of 07/15/2013. Thus the WCJ characterized it as “internally inconsistent.”

The parties attended an expedited hearing and submitted the medical treatment issue framed by the UR dispute for determination. The WCJ determined that UR was untimely, and therefore the underlying medical treatment issue was not subject to Independent Medical Review (!MR). Defendant disputes the determination that UR was untimely and Petitioned for Reconsideration which was denied in the panel decision of Rivera v Valley Radiology.

Pursuant to 8 CCR Section 9792.9(a)(J) the RFA shall be deemed to have been received by Defendant by facsimile on the date the request was received if the receiving facsimile electronically date stamps the transmission. If there is no electronically stamped date recorded, then the date the request was transmitted is deemed the date upon which the RFA was received. Here, Defendant offered no evidence of what the receiving facsimile recorded or when. As such, the Regulations are clear that the received date is deemed to be 07/05/2013. Based on the Regulations as applied to the evidence offered, the UR determination was due by 07/12/2013. The UR letter is dated 07/16/2013 and an internally inconsistent proof of service dated 07/15/2013. The WCJ reasoned that “Utilizing either the 07/15/2013 date or the 07/16/2013 date really makes no difference as the UR determination was due by 07/12/2013 and therefore in either case Defendant’s UR is untimely.”

On Reconsideration Defendant claimed for the first time that it has an additional 24 hours pursuant to Section 4610(g)(l)(A) in which to communicate the decision, and therefore the 07/15/2013 determination was timely communicated on 07/16/2013. This argument was not raised at trial. The WCAB panel noted that the parties dispute the date that defendant received the RFA. “However, based on our review of the record, even assuming that defendant received the RFA on July 8, 2013, we find the UR untimely.”

Labor Code Section 4610 (3)(A) provides that “Decisions resulting in modification, delay, or denial of all or part of the requested health care service shall be communicated to physicians initially by telephone or facsimile, and to the physician and employee in writing within 24 hours for concurrent review, or within two business days of the decision for prospective review, as prescribed by the administrative director.”

Similarly, Administrative Director Rule 9792.9.1 states that: “For prospective, concurrent, or expedited review, a decision to modify, delay, or deny shall be communicated to the requesting physician within 24 hours of the decision, and shall be communicated to the requesting physician initially by telephone, facsimile, or electronic mail. The communication by telephone shall be followed by written notice to the requesting physician, the injured worker, and if the injured worker is represented by counsel, the injured worker’s attorney within 24 hours of the decision for concurrent review and within two (2) business days for prospective review and for expedited review within 72 hours of receipt of the request.”

The WCAB panel thus concluded “There is no evidence in this case that defendant communicated their decision “initially by telephone, facsimile, or electronic mail” before it served written notice on July 15, 2013. Therefore, we find defendant’s UR untimely. Accordingly, for the reasons stated herein, we affirm the September 26, 2013 Findings and Award.”

Woman Uses Internet Photos to Fake Comp Burn Injury

Selena Edwards, 38, of Victorville claimed that an unsecured lid caused steaming hot McDonald’s coffee to spill on her right hand, severely burning it. As supporting evidence, she provided pictures of second-degree burns. But the only burns Edwards may suffer from are the prosecutorial ones she now faces for allegedly faking her injuries.

State insurance officials said Edwards looked to the golden arches in Fontana on Jan. 28, 2013, to allegedly commit the crime to extract easy money from McDonald’s Corp. The woman claimed coffee had spilled on her right hand when she was handed a cup with an unsecured lid at the McDonald’s drive-through. The photos and medical documents Edwards provided to bolster her case came from the Internet. “We discovered that some of the photos were from a hospital website,” state Insurance Commissioner Dave Jones said. Edwards also submitted counterfeit documentation for treatment that she claimed to have received from a local hospital. “We contacted her medical provider and discovered she hadn’t received any medical treatment.” The San Bernardino County district attorney charged Edwards with 21 felony counts of insurance fraud and workers’ compensation fraud.

The prosecution of Edwards comes 20 years after a jury awarded $2.9 million to a 79-year-old woman who was badly burned after hot coffee spilled into her lap at a McDonald’s in Albuquerque. The 1994 verdict attracted international attention, was mocked by radio and television talk-show hosts and was even used as a plot point in the TV comedy “Seinfeld.” ABC News called the case “the poster child of excessive lawsuits”, while the legal scholar Jonathan Turley argued that the claim was “a meaningful and worthy lawsuit”. In June 2011, HBO premiered Hot Coffee, a documentary that discussed in depth how the Liebeck case has centered in debates on tort reform. Despite the controversy, the woman in that case, Stella Liebeck, actually did suffer severe third-degree burns and required skin graft surgery.

In January, a woman filed a lawsuit against McDonald’s, saying she was burned when coffee spilled on her at one of the fast-food chain’s Los Angeles restaurants. Paulette Carr claimed she was burned on January 2012 because the lid on her cup was not properly secured. The lawsuit did not describe the severity of Carr’s injuries.

The merit of those cases aside, Jones said that every year tens of thousands of cases that potentially involve fraud are referred to his agency. In the last 11 months there have been 26,415 cases, about 1,549 of which remain open, officials say.

WCAB Panel Rules UR Decision Effective For 12 Months

Martha Reyes sustained and admitted industrial injury while working for Target. Her primary treating physician Dr. Sobol submitted a Request for Authorization on 02/25/2014 seeking authority for “home care assistance 4 hrs/day x 3 days/wk x 6 wks for cooking/cleaning/laundry/med [illegible].” Utilization Review evaluated the request and denied it on 03/28/2014. The applicant did not claim any material defect in the UR decision. Applicant claims to have sought IMR of the UR decision which had not been decided as of the following events.

The Sobol Orthopedic Medical Group then submitted a second similar request on 05/22/2014. He again requested “Home Care Assistance, 4 hours/ day, 3 days/week for 6 weeks,” The form indicates it to be a “New Request” rather than a “Resubmission – Change in Material Facts.” The request was untimely denied by Utilization Review on 06/17 /2014. This untimely 06/17 /2014 UR denial forms the basis of the present controversy.

Applicant filed a 07/10/2014 Declaration of Readiness to proceed to Expedited Hearing, voicing an objection to the 06/17 /2014 Utilization Review Determination as being untimely, and not based on substantial medical evidence. Defendant filed a timely objection to the DOR.

The matter proceeded to Expedited Hearing on 08/21/2014. Submitted for decision was the applicant’s need for further medical treatment generally (in the context of the 06/17 /2014 utilization review decision.) The WCJ determined that Labor Code § 4610(g)(6) bars applicant from litigating the 06/17 /2014 Utilization Review denial, as the same requested treatment was previously denied by Utilization Review on 03/28/2014, and there had been no showing of material change in circumstance necessitating another utilization review. Applicant filed the instant Petition for Reconsideration on 09/16/2014 which was denied in the panel decision of Reyes v Target Inc.

The WCAB panel concluded “Because the March 28, 2014 UR decision was not invalid, then in the absence of changed circumstances (not alleged here), that UR decision “shall remain effective for 12 months from the date of the decision without further action by the employer with regard to any further recommendation by the same physician for the same treatment.” (Lab. Code, § 4610(g)(6).) Accordingly, it is immaterial that applicant’s physician’s May 22, 2014 request for authorization (RFA) was not denied by defendant until June 17, 2014, even though that denial otherwise might have been deemed untimely had it been an initial RFA. (Lab. Code,§ 4610(g)(3).) Under section 4610(g)(6), defendant could properly have disregarded the new RFA and not issued a UR decision at all.”

University Medical Worker Faces Eight Years

A former clerical employee for the Loma Linda University Medical Center was arraigned on four felony counts of Workers’ Compensation Insurance Fraud and one count of Perjury

According to the District Attorney, and allegations in the criminal complaint, 44-year-old Tameca Lavonne Tyler-Willie of San Bernardino filed a workers’ compensation insurance claim in 2012 for an injury at work. According to Senior Investigator Jose Guzman, who is assigned to the case, Tyler-Willie was untruthful about the manner in which she was injured and as to the extent of those injuries, in both written and oral statements made in support of the claim, and to her physicians, Doctor Juma and Dr. Chun, regarding her injury and physical condition, and at a deposition under oath. Tyler-Willie is accused of attempting to defraud Loma Linda University Medical Center.

“As a result of these lies, Ms. Tyler-Willie received workers’ compensation insurance benefits that that she was not entitled to receive,” Guzman said.

Tyler-Willie pleaded not guilty to all counts. If convicted, she faces 8 years and 8 months in County Prison and a fine of up to $150,000. A Disposition/Reset Hearing has been set for Jan. 16, 2015. This case is being prosecuted by Deputy District Attorney David Simon.

SB 863 Forces Large Self Insured Staffing Company to Secure Insurance

Legislators were concerned about unmanageable workers’ compensation losses by staffing companies who were “self insured” in California, and as part of SB 863 required them to become insured as of the end of this year. Perhaps this legislative premonition was well founded. Shares of Vancouver based staffing company Barrett Business Services Inc. were down more than 50 percent after the company announced a big quarterly loss late last month.The Company attributed the loss to an $80 million pretax increase in self insured workers’ compensation reserves, which effectively wiped out Barrett Business Services’ pretax earnings for the past five years. As a result of this news, the Company’s stock declined more than 58%, or $26.18 per share, to close at $18.28 per share on October 29, 2014, on unusually heavy volume.

The Vancouver, Wash. company, provides a variety of business management solutions for small and medium-sized companies with fifty locations in ten states and dozens of offices in Northern and Southern California. BBSI provides human resource outsourcing and professional management consulting, BBSI said the loss resulted from setting aside $80 million for old workers’ compensation claims. “We have every reason to believe that the workers’ compensation data we have presented in the third quarter will normalize over time, proving that the strengthening process and change in practice have had the intended effect,” said CEO Michael Elich, in a news release. “Until then, we believe taking a conservative approach right now allows us to look forward and removes the obstacles of the unknowns within the model.”

A number of attorneys are investigating the company, and at least one, Glancy Binkow and Goldberg LLP, representing investors of BBSI has filed a class action lawsuit in the United States District Court for the Western District of Washington on behalf of a class comprising purchasers of BBSI securities. The Complaint alleges that defendants made false and/or misleading statements and failed to disclose material adverse facts about the Company’s operations and financial performance and prospects. Specifically, the Complaint alleges that defendants made false and/or misleading statements and/or failed to disclose that: (1) the Company under accrued its self-insured workers’ compensation reserves; (2) as a result, the Company overstated its earnings; (3) the Company lacked adequate internal and financial controls; and (4), as a result of the foregoing, defendants’ statements were materially false and misleading at all relevant times. A Los Angeles law firm says it’s investigating potential claims on behalf of shareholders of BBSI. The Wagner Firm says its investigation concerns “possible violations of federal securities laws” and focuses on statements the company made about its “financial results, operations and business prospects” as well as others across the nation. Several other law firms nationwide have issued similar press releases.

Established in 1965,BBSI offers both temporary and long-term staffing to some 1,750 small and midsized businesses. Its staffing services focus on light industrial, clerical, and technical businesses. Barrett also does business as a professional employment organization (PEO), providing outsourced human resource services, such as payroll management, benefits administration, risk management, recruiting, and placement for more than 1,500 clients. Each year about 90% of its PEO revenue comes from customers residing in the states of California and Oregon. Barrett depends mostly on the light-industrial sector for the majority of its staffing services revenue (the sector represented 86% of its total revenue in 20010). Its light-industrial workers operate machinery and perform manufacturing, loading and unloading, and construction-site cleanup tasks.

The Company is a self-insured employer with respect to workers’ compensation coverage for all of its employees (including employees co-employed through client service agreements) working in California, Oregon, Maryland, Delaware and Colorado, with some exceptions. The Company maintains excess workers’ compensation insurance through its wholly owned captive insurance company, Associated Insurance Company for Excess (“AICE”), with a per occurrence retention of $5.0 million, except in Maryland and Colorado.

In February, 2014, BBSI entered into a workers’ compensation insurance arrangement with ACE to provide coverage to BBSI employees in California beginning in the first quarter of 2014. The agreement will be effective through January 2015 with the potential for annual renewals thereafter.The arrangement, typically known as a fronted program, provides BBSI a licensed, admitted insurance carrier in California to issue policies on behalf of BBSI without the intention of transferring any of the worker’s compensation risk for the first $5.0 million per claim. The risk of loss up to the first $5.0 million per claim is retained by BBSI through an indemnity agreement. While this portion of the risk of loss remains with BBSI, ACE assumes credit risk should BBSI be unable to satisfy its indemnification obligations to ACE. ACE also bears the economic burden for all costs in excess of $5.0 million per claim. The arrangement with ACE addresses the requirements of legislation enacted in California in 2012 (Senate Bill 863) under which the Company cannot continue its self-insurance program in California beyond January 1, 2015.

Dismissal of Injured Cafeteria Worker Discrimination Case Affirmed

In March 2009 Sally Wycoff was working for Paradise Unified school District as a cafeteria worker for approximately four hours per day, and as a food services manager for 3 hours 15 minutes per day. The job required the ability to “stand, stoop, reach and bend,” the ability to “grasp and manipulate small objects,” and to “lift, push and/or pull objects which may approximate 50 pounds and may occasionally weigh up to 100 pounds. She reported to her employer that she had sustained a right shoulder injury caused by repetitive use associated with her job and completed a workers’ compensation claim form.

The employer admitted the injury. Wycoff had shoulder surgery on July 21, 2009. The District hired a substitute to fill Wycoff’s position as a cafeteria worker. A series of letters followed discussing her sick leave benefits, and other rights to illness and accident leave for employees who are part of classified employment. Wycoff met with several District employees to discuss her options in late October 2009. She was offered part-time work as a food services manager, which would not require pulling, pushing, or lifting. However, she would not receive health insurance for part-time work. She was also told she could ask the school board to extend her leave. During these discussions, Wycoff brought up the possibility of taking early retirement, which was something one of her friends had suggested. She ultimately applied for early retirement after her other efforts to return to work were unsuccessful.

Wycoff then filed a complaint against District alleging the following causes of action: (1) physical disability discrimination in violation of the Fair Employment and Housing Act (FEHA); (2) Retaliation because of a physical disability and because a workers’ compensation claim was filed; (3) intentional infliction of emotional distress; (4) negligent infliction of emotional distress; (5) negligent supervision; and (6) failure to accommodate a physical disability. Following District’s successful demurrer to the third, fourth, and fifth causes of action, the trial court dismissed those causes of action. Wycoff pleaded three causes of action that survived demurrer: (1) disability discrimination, (2) retaliation, and (3) failure to accommodate a physical condition. With regard to those three, the District’s summary judgment motion was granted by the trial court and her case was dismissed. The dismissal was affirmed by the Court of Appeal in the unpublished case of Wycoff v. Paradise Unified School Dist. CA3.

The trial court found that District offered and provided reasonable accommodation. The court also found that Wycoff’s immediate supervisor averred Wycoff was unable to do the basic and essential job duties of a cafeteria worker, and that there was no vacant position and no accommodation that would have allowed Wycoff to return to her position as a cafeteria worker without making other people do Wycoff’s job or hiring another employee to assist Wycoff in doing her job.

Wycoff’s release for work from her physician, dated October 22, 2009, placed the following restrictions on her ability to work: “no overhead work with right arm and no lifting over 20 lbs.” Wycoff’s immediate supervisor stated that with those restrictions, Wycoff was not able to do the basic and essential job duties of a cafeteria worker, and that she was aware of no accommodation that would have made it possible for Wycoff to perform that job. Wycoff admitted in her deposition that “most if not all of [her] essential job functions were problematic for [her] right shoulder . . . .” She admitted there was no way she could have returned to work in her prior capacity in October 2009. She stated that at the time of the deposition (June 9, 2011) she still could not do the work that she did five years prior, and that it was still painful when she engaged in repetitive lifting, pushing, and pulling. At that time (June 9, 2011) she was still not allowed to do overhead work with her right arm or lift more than 20 pounds. Given this undisputed evidence, there was no requirement that District do more to ascertain Wycoff’s ability to perform her job. Under such circumstances there was no evidence that the District failed to participate in the interactive process as required by law.

Californians Weigh In on Insurance Related Ballot Propositions

California voters soundly rejected two hotly contested propositions Tuesday night — one that claims it would have halted excessive health care insurance rates and another that would have raised the state’s 39-year-old cap on medical malpractice damage awards.

Proposition 45 would have given the state insurance commissioner the power to reject health insurance rate hikes for about six million Californians who buy their own policies or who work for small businesses. The measure would have required health insurance companies to publicly disclose rate changes and allowed California’s insurance commissioner to control rates. Supporters said the initiative would stem skyrocketing healthcare costs. It failed to pass by a wide margin. Insurance Commissioner Dave Jones won reelection Tuesday, but he’s left with no real power over health insurance rates. Jones had invested significant political capital in campaigning for Proposition 45 and drew the ire of fellow Democrats at times for his criticism of Covered California. The commissioner called Tuesday’s vote a major setback. “Health insurers flooded Californians with $57 million worth of false television commercials, radio ads and slick mailers,” Jones said. “Our consumer coalition simply could not compete with that.” Jones’ backers see the fight returning to Sacramento. “We expect the rate regulation debate to return to the Legislature, possibly with more momentum,” said Anthony Wright, executive director of Health Access. “We will continue to advocate the simple point that patients shouldn’t have to pay premiums deemed unreasonable by regulators.”

“Prop. 45 was an ill-conceived measure that would have been a step backwards against the progress made by the Affordable Care Act and our state’s health exchange, by giving a politician power over health care decisions that should have involved doctors and their patients,” Dr. John Maa of the San Francisco Medical Society, said in a statement. “California voters saw through this deceptive measure motivated by self-interest, and opposed it wholesale.”

The Los Angeles Times laments the loss as a “boon for health insurers.” The Times went to to say that “California’s biggest health plans, led by Anthem Blue Cross and Kaiser Permanente, spent millions of dollars on ads portraying Proposition 45’s rate regulation as a threat to implementation of the health law. In a lopsided result, 60% of voters joined the industry in opposition.” Despite the stinging loss, supporters of rate regulation vowed to keep fighting on behalf of consumers in the courts, state Legislature and possibly again at the ballot box.

“It’s incredible that an industry that’s so unpopular could do so well in this election,” said Robert Laszewski, a healthcare consultant who has closely tracked California’s implementation of the health law. “Pro-Obamacare forces and anti-regulation folks formed a 60% coalition. It was a strange set of bedfellows.”

Proposition 46, which would have raised the state’s 39-year-old cap on medical malpractice damage awards, would have also required doctors to take random drug tests and mandate use of a database designed to reduce prescription drug abuse. It was a wide-ranging initiative that included raising the limit on pain and suffering damages in medical malpractice lawsuits. This proposition was also defeated Tuesday by a wide margin. Supporters had said the proposition would have detected and deterred medical negligence, over-prescribing of prescription drugs and drug and alcohol abuse by doctors and promoted justice for people who don’t have an income — including retirees, children and stay-at-home parents — who are victims of medical malpractice.

“This was a battle worth fighting. But the battle doesn’t stop here,” Bob Pack, author of Proposition 46, said in a statement released late Tuesday night. He and his wife, Carmen, lost their two children Troy and Alana as a result of medical negligence. “Our coalition will continue to press for changes to end that cycle of preventable death, to put a dent in prescription drug abuse, ensure our doctors aren’t operating under the influence and give malpractice victims a better shot at justice,” Pack said.

The defeat of Proposition 46 came after a cascade of negative advertising financed by insurance and physician groups. They warned the change would send medical costs soaring and drive doctors from the state. “In this health care environment, undermining California’s long-standing malpractice cap is a political poison pill,” Dustin Corcoran, chief executive of the California Medical Association and chairman of the No on 46 campaign, said in a statement. “Increasing payouts in medical lawsuits would have increased health care costs.” Insurance companies, hospitals and physician groups depicted the proposal as a sugar-coated pill that’s really about fattening attorneys’ wallets.

Medicare Pays for Prescriptions for the Deceased

An investigation by the U.S. Department of Health and Human Services found that the federal insurance program paid nearly $300,000 to cover HIV drugs for about 160 people who were dead when their prescriptions were filled in 2012. The report, released last week, was a reminder that Medicare’s struggles with fraud, waste and abuse remain a drain on the more than $580-billion insurance program.

Under the Medicare Part D program, the Centers for Medicare and Medicaid Services (CMS) contracts with private insurance companies, known as sponsors, to provide prescription drug coverage to beneficiaries who choose to enroll. The Office of Inspector General (OIG) says in the report that it “has had ongoing concerns about Medicare paying for drugs and services after a beneficiary has died. Drugs that treat the human immunodeficiency virus (HIV) can be a target for fraud, waste, and abuse, primarily because they can be very expensive. Although this report focuses on HIV drugs, the issues raised are relevant to all Part D drugs.”

This study was based on an analysis of Prescription Drug Event (PDE) records for HIV drugs in 2012.  Part D sponsors submit these records to CMS for each drug dispensed to beneficiaries enrolled in their plans. Each record contains information about the drug, beneficiary, pharmacy, and prescriber. Investigators used the Beneficiary Enrollment Database, the Social Security Administration’s Death Master File, and Accurint’s Death Records to identify beneficiaries’ dates of death.

Investigators discovered that Medicare paid for HIV drugs for over 150 deceased beneficiaries. CMS’s current practices allowed most of these payments to occur. Specifically, CMS has edits (i.e., systems processes) in place that reject PDE records for drugs with dates of service more than 32 days after death. CMS’s practices allow payment for drugs that do not meet Medicare Part D coverage requirements. Most of these drugs were dispensed by retail pharmacies. “This review looked only at HIV drugs, which account for one-quarter of one percent of all Part D drugs in 2012. However, our findings have implications for all drugs because Medicare processes PDE records for all drugs the same way. Considering the enormous number of Part D drugs, a change in practice would affect all Part D drugs and could result in significant cost savings for the program and for taxpayers.”

Another recent OIG report found that nearly 1,600 Part D beneficiaries had questionable utilization patterns for HIV drugs in 2012. In total, Medicare paid $32 million for HIV drugs for these beneficiaries. These beneficiaries had no indication of HIV in their Medicare histories, received an excessive dose or supply of HIV drugs, received HIV drugs from a high number of pharmacies or prescribers, or received contraindicated drugs. These questionable patterns indicate that beneficiaries may be receiving inappropriate or unnecessary drugs. It may also indicate that a pharmacy is billing for drugs that a beneficiary never received, or that a beneficiary’s identification number has been stolen.

Another earlier OIG report looked at the extent to which CMS made monthly prospective payments in 2011 to Part C and D sponsors for deceased beneficiaries. According to CMS policy, Medicare pays the sponsor the full payment for the month in which a beneficiary dies. OIG found that in 2011, CMS made monthly payments to Part C and D sponsors totaling $21 million for deceased beneficiaries in the months after death.

Lastly, another OIG report found that in 2006 and 2007 CMS paid $3.6 million in monthly prospective payments to certain Part D sponsors for deceased beneficiaries. It found that although CMS had correctly stopped payments for the vast majority of deceased beneficiaries in 2006 and 2007, its systems did not always identify and prevent improper payments. In addition, CMS did not always recover on a timely basis the payments it had made on behalf of deceased beneficiaries.

So these problems appear again, in plain sight. Willie Sutton Jr. was a prolific American bank robber. Sutton is known, albeit apocryphally, for the urban legend that he said that he robbed banks “because that’s where the money is.” He died in 1980. He would probably be looking at Medicare today for his next heist were he still around.

Researchers Find Smoking and Back Pain Link

A new Northwestern Medicine® study has found that smokers are three times more likely than nonsmokers to develop chronic back pain, and dropping the habit may cut chances of developing this often debilitating condition. Since apportionment of permanent disability can be based upon causation, this study may be of interest to the workers’ compensation community.

“Smoking affects the brain,” said Bogdan Petre, lead author of the study and a technical scientist at Northwestern University Feinberg School of Medicine. “We found that it affects the way the brain responds to back pain and seems to make individuals less resilient to an episode of pain.” This is the first evidence to link smoking and chronic pain with the part of the brain associated with addiction and reward. The study was published online in the journal Human Brain Mapping.

The results come from a longitudinal observational study of 160 adults with new cases of back pain. At five different times throughout the course of a year they were given MRI brain scans and were asked to rate the intensity of their back pain and fill out a questionnaire which asked about smoking status and other health issues. Thirty-five healthy control participants and 32 participants with chronic back pain were similarly monitored.

Scientists analyzed MRI activity between two brain areas (nucleus accumbens and medial prefrontal cortex, NAc-mPFC), which are involved in addictive behavior, and motivated learning. This circuitry is critical in development of chronic pain, the scientists found. These two regions of the brain “talk” to one another and scientists discovered that the strength of that connection helps determine who will become a chronic pain patient. By showing how a part of the brain involved in motivated learning allows tobacco addiction to interface with pain chronification, the findings hint at a potentially more general link between addiction and pain. “That circuit was very strong and active in the brain’s of smokers,” Petre said. “But we saw a dramatic drop in this circuit’s activity in smokers who — of their own will — quit smoking during the study, so when they stopped smoking, their vulnerably to chronic pain also decreased.”

Medication, such as anti-inflammatory drugs, did help study participants manage pain, but it didn’t change the activity of the brain circuitry. In the future, behavioral interventions, such as smoking cessation programs, could be used to manipulate brain mechanisms as an effective strategy for chronic pain prevention and relief.