Menu Close

Category: Daily News

More than 50% of Patients Make Costly Medication Mistakes After Surgery

More than half of heart patients in a new study made mistakes taking their medications or misunderstood instructions given to them after being discharged from the hospital. Those with the lowest “health literacy” were among the most likely to make the risky errors, highlighting the importance of healthcare professionals making sure their instructions are clear and of patients being sure they understand what they need to do after they get home, the study authors say. “Some errors have the potential to be harmful to patients,” said lead author Dr. Amanda Mixon, a hospitalist with the VA Tennessee Valley Healthcare System in Nashville. “Thousands of patients are discharged home with medications every day. Knowing which patients are at risk of medication errors after patients go home can help inpatient providers counsel patients about their medications before they go home,” added Mixon, who is also affiliated with Vanderbilt University.

According to the story in Reuters Health, past research suggests that an individual’s health literacy, the ability to interpret and act on health information, is a strong predictor of whether they will correctly follow instructions for their own care. Overall, 20 to 30 percent of prescriptions are never filled, and 50 percent are not continued as prescribed, according to the U.S. Centers for Disease Control and Prevention.

To assess what factors might influence whether heart patients will follow their care instructions correctly after leaving the hospital, Mixon’s team recruited 471 people hospitalized for heart failure, heart attacks and related conditions, then discharged from the hospital. The participants’ average age was 59 and just under half were women. Every participant took a seven-minute health literacy test to gauge their understanding of health information as well as a short numeracy test to measure basic math skills.

The researchers contacted the patients by telephone two to three days after they left the hospital and compared the medications on the discharge list from their doctors to what the patients said they were taking. When someone said they were taking a medication not on the list, or forgot to mention one that was on the list, it was counted as an error. If a patient didn’t know the purpose, dose or frequency of a medication, it was classified as a misunderstanding. Failure to refill a prescription, discontinuing use of a medication against a healthcare professional’s orders or not being aware of a medication were also counted as errors.

More than half – 242 of the 471 patients – had at least one discrepancy between the medications they reported taking, and the ones on their discharge list. Over a quarter left out one or more medications on their list and more than a third were taking something that was not on the list. And 59 percent of patients had a misunderstanding of the purpose, dose or frequency of their medications.

Participants who scored highest on the math skills test were about 23 percent less likely than those who scored lowest to add or omit medications, the researchers report in Mayo Clinic Proceedings. People with the highest health literacy scores were about 16 percent less likely to make an error compared to those who scored lowest. And women were about 40 percent less likely than men to make a mistake. Single people were almost 70 percent more likely than people who were married to make errors. Older age and worse cognitive function also predicted higher odds of having an error.

“It’s a powerful study in that it helps to define some of the things we assume, but haven’t been able to fully understand,” said Dr. Benjamin Brooke, a surgeon and professor at the University of Utah School of Medicine in Salt Lake City, who was not involved in the study. “I think this says that we need to do a better job of understanding a patient at the time of discharge, what are their risks of having a post discharge adverse event,” he told Reuters Health.

This study should help workers’ compensation case managers focus on a strategy that should help better post surgical outcomes.

Uninsured Motorist Carrier May Offset Workers’ Compensation Benefits

Nicholas Ortiz was injured while in the course and scope of his employment when a vehicle driven by Choi Seok Hwan collided with his vehicle. Hwan’s insurance policy had an available per person policy limit of $15,000 and Ortiz settled his liability claim for that amount. Ortiz also received approximately $107,000 in workers’ compensation benefits.

Ortiz then made a claim for underinsured motorist benefits under a State Farm automobile policy. This policy has underinsured motorist limits of $100,000. State Farm denied his claim based on the offset language in the policy’s underinsured motorist coverage section which provided that “Any amount payable under this coverage shall be reduced by any amount paid or payable to or for the insured : a.for bodily injury under the liability coverage; or b.under any workers’ compensation, disability benefits, or similar law.”

Ortiz filed a complaint in Superior Court for declaratory relief claiming that, when compared to the statutory requirements, this offset provision is overly broad and therefore is void. The trial court disagreed with Ortiz and concluded that the policy was to be read and enforced as if it did comply with the law and that the $107,000 Ortiz received in workers’ compensation benefits reduced the available underinsured motorist benefits to “$0.” Accordingly, the trial court granted State Farm’s motion for summary judgment.

The Court of Appeal agreed with the dismissal and reasoning of the trial court in the unpublished case of Nicholas Ortiz v State Farm Mutual Automobile Insurance Company.

Insurance Code section 11580.2, subdivision (h), provides that any loss payable under the terms of the uninsured motorist endorsement or coverage to or for any person may be reduced by the amount paid under any workers’ compensation law, exclusive of nonoccupational disability benefits. Although this setoff provision specifically applies to uninsured motorist coverage, it permits such a setoff against underinsured motorist coverage as well. (Rudd v. California Casualty Gen. Ins. Co. (1990) 219 Cal.App.3d 948, 953-954.)

State Farm was statutorily authorized to offset these workers’ compensation benefits against the underinsured motorist coverage. By authorizing such a reduction, the Legislature intended to prevent the insured from recovering twice for the same injury. The Legislature’s purpose in enacting section 11580.2 was to shift the cost of an industrial injury sustained by an employee, as the result of the negligence of an uninsured motorist, from the motoring public (who pay the premium for uninsured motorist coverage) to the employer or workers’s compensation carrier. Thus, as applied to appellant, the offset provision in the State Farm policy promotes public policy.

DWC Publishes Assessment of SB 863 Reforms

The Department of Industrial Relations and its Division of Workers’ Compensation posted a progress report on the department’s implementation of Senate Bill 863, the 2012 law which makes wide-ranging changes to California’s workers’ compensation system.

The report, “SB 863: Assessment of Workers’ Compensation Reforms,” describes improvements made as well as the challenges remaining to fulfill the law’s intent to improve benefits to injured employees while containing costs. SB 863 became law on Jan.1, 2013, but not all provisions were effective immediately, and some aspects are still going through the rulemaking process.

:DIR took a balanced approach to putting SB 863’s reforms into practice,” said DIR Director Christine Baker. “The priority was to increase the benefits in 2013, reduce frictional costs and implement the cost savings efficiencies through regulations, a process that started as soon as the law was signed. We have laid the groundwork for the next stage of improvements and expect more gains in the years ahead.” Key findings of the report include:

1)  Although SB 863 successfully trimmed three percentage points off the rate increase, employers still had to endure an increase of more than 10% in their workers’ compensation costs. Insurance prices had already begun to rise in 2012. After SB 863 was passed, the Department of Insurance adopted a minimum pure premium rate for Jan. 1, 2013, which was up 11.3% from the rate one year earlier. If SB 863 had not been enacted, indications are that the rates would have increased by 14.3%.
2)  Permanent disability benefits increases are now in effect. It is too soon to determine the net effects, primarily because it takes up to two years or more for permanent disability to be determined.
3)  SB 863 strengthened California’s self-insurance marketplace, thanks to the greater oversight authority provided to DIR’s Office of Self Insurance Plans over self-insured employers. The reforms lowered the rate of defaults thereby reducing costs to all remaining self-insurers. To date, no defaults have occurred in self-insured entities since SB 863 regulatory changes went into effect.
4)  SB 863 reduced ambulatory surgery center (ASC) facility fees from 120% to 80% of Medicare’s hospital outpatient fee schedule. The average amount paid per ASC episode in the first six months after the change in fee schedules was 26% lower than in the year before the change took effect.
5)  SB 863 amended the inpatient fee schedule by repealing the separate reimbursement for spinal hardware. The average amount paid per episode of the spinal surgery involving implantable hardware declined by 56% after the separate reimbursement (duplicate payment) for spinal hardware was repealed.
6)  The lien filing fee halved the number of new liens being filed. In the first year the filing fee was in effect, 213,092 liens were filed, down from 469,190 in 2011, a greater than 50% reduction. This represents a cost savings of an estimated $270 million per year in litigation costs to California employers and insurers.
7)  Medical costs appear to be down: Preliminary data from WCIRB indicate that the estimated ultimate medical loss per lost-time claim is down 1.3% from calendar year 2012 to 2013. However, because the estimate is based on historical trends and adjusters’ predictions of what their cases will cost over the lifetime of the case, it is a weak performance indicator of the workers’ compensation system after the extensive reforms brought about by SB 863.
8)  The Independent Medical Review (IMR) process is heavily used: approximately 185,000 IMR applications have been filed to date. The qualified medical evaluator (QME) process that IMR replaces costs on average $1,653 per QME request, at least three times higher than the administrative cost of an IMR. An IMR costs $420 to process, down from $560 initially, and the cost will go down further starting in 2015.
9)  Ten sets of cost-saving regulations have been enacted, and additional regulations are in process.
10)  More than 80 percent of IMR determinations uphold the utilization review (UR) finding that the treatment requested is not medically necessary. Pharmaceuticals are the most common IMR request, and narcotics are the most common type of pharmaceutical requested.

“One of the key improvements of the reforms was to improve the delivery of appropriate medical care to injured workers through an independent medical review process that is transparent and consistent and uses evidence-based medicine,” said Dr. Rupali Das, DWC Medical Director. It is still too early to gauge the overall effect of SB 863 reforms. Revisions to the lien filing procedures, as well as the conflict of interest statute and the fee schedule changes, are expected to help reduce fraudulent behavior in the workers’ comp system.

The progress report is posted on the DIR website.

Employers’ Fraud Task Force Announces August Event

The Employer’s Fraud Task Force (EFTF) has scheduled its annual Fraud Fighting Conference for August 28th and 29th, at the Pala Casino Spa Resort in Pala California.

The event – “Risky Business. The Stakes Are High” – features industry leaders, players, movers and shakers as they bring you up-to-date on the games people play and the price you could be paying if the deck is stacked against you. What’s coming at you that you can’t see? Who’s bluffing? Who’s winning and who’s losing?

John Floyd, Senior Partner with FSK, will be speaking during the conference, and will be joined by industry experts such as John Riggs, Fraud Assessment Commissioner and Manager Workers’ Comp, Disneyland Resort and Alex Rossi, the County of Los Angeles risk manager. Destie Overpeck, the Acting Administrative Director, Division of Workers’ Compensation will be the luncheon speaker on the first day and will present her topic “Playing by the House Rules.”

On the second day of the conference, Keynote Speaker, Christine Baker, the Director of the Department of Industrial Relations will discuss her topic “Is The Deck Marked? The Underground Economy.” John Riggs, Jennifer Snyder, Deputy District Attorney, Los Angeles District Attorney’s Office and Captain David Goldberg, Department of Insurance Fraud Division (Invited) will discuss “Games People Play – Who’s Cheating and Why?”

For additional information and to attend, sponsor or exhibit contact: Laura Clifford, Phone/Fax 714.637.3350, Mobil 323.559.0015 or email at lauraclifford@sbcglobal.net. The Pala Resort and Casino is located at 11154 Highway 76 in Pala, California (North San Diego County). For Room Reservations call 877.725.2766. For special room rates mention code EMPH14A or Employers’ Fraud Task Force.

Stop by our Floyd, Skeren and Kelly booth to meet with some of our attorneys and to learn about our upcoming events.

Three Indicted in $50 Million Orange County Surgical Fraud Scheme

Three Orange County residents allegedly defrauded insurers by submitting bills for more than $50 million for medically unnecessary procedures, federal prosecutors said Wednesday in a 15-count indictment.

Charged were Vi Nguyen, 31, of Placentia (10 counts of mail fraud); Theresa Fisher, 44, of Tustin (five counts of mail fraud); and Lindsay Hargraves, 30, of San Pedro (two counts of mail fraud). Nguyen and Fisher were “consultants,” Hargraves a marketer. All three were arrested on July 1 before the criminal complaint was unsealed. They were all released on bond. They are to be arraigned on July 28.

Prosecutors claim the defendants used marketers to lure patients to a surgery center in Orange, known at various times as Empire Surgical Center, Vista Surgical Center and Princess Cosmetic Surgery. These were different business names for the same surgery center, consisting of one consultation office and one surgical suite, located at 1310 W. Stewart Drive, Suites 309 and 310, Orange, California. “The marketers told patients that they could use their union or PPO health insurance plans to pay for cosmetic surgeries, which are generally not covered by insurance,” the US. Attorney’s Office said in a statement announcing the indictment.

At the center, prosecutors said, the patients were told they could get free or discounted cosmetic surgeries if they submitted to “multiple, medically unnecessary procedures that would be billed to their union or PPO health care benefit program.” The health care programs were funded by the International Longshore and Warehouse Union and Pacific Maritime Association Welfare Plan as well as private programs such as Anthem Blue Cross Blue Shield and Horizon Blue Cross and Blue Shield of New Jersey. The plans generally did not cover cosmetic surgery.

The unnecessary procedures typical were endoscopies, colonoscopies and/or cystoscopies. The plastic surgeries included tummy tucks, falsely billed as hernia repairs; nose jobs, falsely billed as deviated septum repairs; breast surgeries and liposuction, prosecutors said. Empire, Vista, or Princess also allegedly billed union and PPO health care benefit programs for procedures that never were performed on patients.

Private Self-Insured Claim Rate Shows Little Change

California private self-insured indemnity claim frequency increased 7.6% in 2013, but the incidence of medical-only claims declined 4.7%, so the overall claim frequency rate for private self-insured employers showed little change from the 2012 level according to a CWCI analysis of data compiled by the California Office of Self Insurance Plans (OSIP).

OSIP’s annual summary offers the first look at private, self-insured claims experience for calendar year 2013, tracking a number of variables, including medical-only and indemnity claim volume as well as total payments and total incurred losses on those claims through the end of last year. The summary of 2013 claims experience covered 2.09 million workers employed by California private self-insured employers, which was down about 2% from 2012, but down nearly 26% from the 2.81 million employees covered in the initial report for 2005 – the first year following enactment of SB 899. Private self-insured employers reported a total of 76,015 claims last year, 1,542 fewer than in the 2012 initial report, and the lowest first report tally in the last 10 years.

To control for the effect of year-to-year changes in the number of covered employees on claim counts and to determine the claim frequency trend for the past decade, CWCI used the OSIP first report data from 2004 to 2013 to calculate the number of private self-insured claims per 100 employees. The results show a sharp decline in private self-insured claim frequency in the wake of the 2002-2004 reforms, followed by an increase from 2005 to 2007 as the medical-only claims rate rose. Since 2007, overall claim frequency for private self-insured employers is down 8.8%, primarily due to reductions in the medical-only claims rate. In contrast, from 2006 until last year, indemnity claim frequency remained relatively flat, ranging between 1.32 and 1.37 claims per 100 employees; but, in 2013, it registered the biggest increase in 10 years, jumping 7.6% to 1.42 claims per 100 employees – the highest level since 2005.

The decline in the covered work force also affected the total paid losses for 2013, as private self-insured employers reported that as of the end of the year they had paid $180.9 million ($76.7 million indemnity + $104.2 million medical) on 2013 claims — 2.8% less than the $186.2 million recorded in the initial report for 2012 claims. That translates to an average payment of $2,380 for the 2013 claims at the end of the calendar year, less than 1% below the average for 2012, and only 4.2% below the 10-year high of $2,485 noted in the first reports for 2010 claims. A closer look at the first reports reveals that the private self-insureds averaged $1,009 in indemnity payments on their 2013 claims, 2.6% more than in 2012 and the highest level in the last 10 years; while medical payments on the 2013 claims averaged $1,371, 3.3% less than in 2012 and 8.6% less than 10-year high noted in 2010 — but still 38.1% more than the post-reform low of $993 from 2005.

Progressive Medical and PMSI to Rebrand as Helios

Progressive Medical Inc. and PMSI Inc., two workers compensation pharmacy benefit managers that merged in October, will begin operating under the name Helios in August, according to a statement issued Tuesday. Helios is based in Memphis, Tennessee, and employs more than 1,400 workers nationwide, including at Progressive Medical’s Westerville, Ohio, location, PMSI’s Tampa, Florida, office and offices in Salt Lake City and Price, Utah, according to the Helios website. The rebranding will be fully effective Aug. 18.

“Our new name is the outcome of a thorough and deliberate process that involved a great deal of research,” the company said in a statement posted online. “We considered a large number of concepts and in the end, selected Helios for its strong representation of our brand, the vigor in which we operate, and overall positive disposition.”

“While our name and look are changing, our commitment to doing what’s right is unchanged,” said Tommy Young, Co-CEO. “We will continue to provide exceptional service, proactively share intelligence with our clients to ensure they have the best information to manage their businesses, and deliver innovative solutions to effectively drive down costs and improve both clinical and financial outcomes.”

The name was chosen because it embodies the vision, values, and personality of the organization and captures the legacies of the two companies, according to H. Barry Jarnigan, Chief Marketing Officer. “Helios captures the energy, strength, reliability, and consistency of our company as well as our passion and dedication for providing exceptional, accountable service.”

Helios will be a new name in the workers’ compensation and auto no-fault markets; however, it will be built upon Progressive Medical and PMSI’s legacy of innovative products and exceptional service. Along with the name, the company will unveil a new logomark at the Workers’ Compensation Institute’s annual conference beginning August 18.

Another Federal Agency – ICE – Botches Workers Compensation Claims

Last week, Veterans Affairs released a report about its Workers Compensation program, which documented mismanagement of the Workers’ Compensation program similar to other programs administered by the VA. Oversight revealed that over 60% of all claims evaluated were not monitored properly. VA lacked a fraud detection process, which is surprising in light of VA’s perpetual focus on veterans potentially defrauding the disability compensation program. Apparently its own workers get a pass for fraud. OIG concluded VA could save over $92 million if it improves management of the program

This week it is learned that the agency responsible for investigating and enforcing immigration laws has not done a very good job of investigating its own employees’ claims of on-the-job injuries or enforcing the law that governs workers’ compensation, according to a new report summarized in Government Executive.

Immigration and Customs Enforcement paid five of its employees $1 million in workers’ comp after the employees were medically cleared to work, an audit by the Homeland Security Department’s inspector general found. One of those individuals has received more than $233,000 in compensation since medical personnel deemed the employee fit for work “several years ago,” the IG wrote. That was just one of many problems the IG found. In addition, agency supervisors did not document events accurately or completely; neglected to probe questionable claims; and failed to identify responsible third parties. “ICE has neither ensured effective claims processing oversight and case management nor returned employees to work at the earliest opportunity,” the IG reported.

The Federal Employees Compensation Act provides lost earnings, medical care and survivors’ benefits to civilian employees who have suffered work-related traumatic injuries or diseases. The Labor Department administers the program and adjudicates claims, but agencies must administer the programs internally, process claims and manage the compensation. Agencies are responsible for paying employees while claims are pending; if Labor denies a claim, the agency is to recover the payments by adjusting the employee’s leave balance or collecting the overpayment.

“ICE workers’ compensation specialists did not monitor the medical and return-to-work status of claimants, retain documentation associated with cases, return employees to work, or recover salaries for denied claims,” the IG wrote.

In a review of 132 case files tested for accuracy, auditors found that 19 percent did not include basic information, such as whether injuries were work-related. For example, one employee was injured eating lunch while away from work premises; another was in an accident three hours prior to the start of the work day — in neither case was there documentation showing any relationship to work. Nor did the files contain information about whether a third party could be financially liable for injuries, for example in cases where another driver struck an employee’s vehicle.

To address the problems, the IG recommended that Homeland Security develop and implement effective policies and procedures, and that ICE develop and implement a policy for returning employees to light work when they have medical restrictions. ICE and DHS concurred with the recommendations.

DWC Now Accepting QMEApplications

The Division of Workers’ Compensation is now accepting applications for the Qualified Medical Evaluator examination set for October 18.

The Application for Appointment as QME and all required documentation must be reviewed and approved by the DWC before a physician can be registered for the exam, (Title 8, California Code of Regulations §§10, 11). The application must be postmarked by September 11, 2014, in order to qualify for this exam. Qualified registrants will receive by e-mail/mail, a confirmation letter along with a Candidate Information Booklet.

Physicians who wish to take the exam on October 18, 2014, must submit a completed original Application for Appointment as Qualified Medical Evaluator (QME Form 100, Rev.10/2013)  Physicians who submitted an Application for Appointment as a QME form 100, (rev 10/2013), for the last exam April 12, 2014, are not required to submit another application, but must send all other documentation/fee required and Registration for the QME Competency Examination (QME Form 102, Rev. 2/09).

All physicians are required to pay a non-refundable/non-rollover $125.00 fee to sit for any upcoming QME examination. (Title 8, California Code of Regulations § 11(f)(2)). Before appointment as QME, the physician shall complete a 12 hour course in disability evaluation report writing, approved by the Administrative Director. (Labor Code § 139.2)

Surveillance Evidence Convicts Santa Barbara Roofer

Santa Barbara County District Attorney Joyce E. Dudley announced the conviction of Francisco Javier Carranza, 44 years old, of Lompoc, California. Carranza pied guilty to two felony counts of Workers’ Compensation Fraud and was sentenced to 100 days in jail, was placed on three years of felony probation and ordered to pay more than $68,000 in restitution.

Carranza filed a workers’ compensation claim for an injury sustained while working for Action Roofing Company, a local Santa Barbara business. Suspicions arose when Carranza claimed he was not getting better despite years of medical treatment and benefit payments. Carranza complained of ongoing pain and claimed he was incapable of working or walking without the use of a device. Surveillance video proved Carranza’s claims were fraudulent.

Carranza’s fraudulent claims resulted in losses to the State Compensation Insurance Fund totaling $36,519.66 and to Action Roofing in the sum of$31,710.21. District Attorney Joyce Dudley noted that, “Engaging in workers compensation fraud negatively impacts our entire community, as well as individuals and their families who rely upon this system when they become and remain injured on the job. For these reasons, our office will continue to rigorously prosecute these crimes.”