Category: Daily News

An article in the Insurance Journal says it was an “interesting but quiet year” for California Lawmakers on Workers’ Comp.  Bills signed by Gov. Jerry Brown included laws on pharmaceutical compounding, preventing out-of-state athletes from filling for workers’ comp, funding for the state’s prescription drug monitoring program and more. There were 17 total, according to a list compiled by the California Workers’ Compensation Institute (CWCI). But overall, it was a quiet year in terms of workers’ comp laws, as expected.

Pharmacy Billing (SB 146, Lara): Eliminates the requirement that copies of prescriptions be sent with requests for payment unless the provider entered into a written agreement to do so. Also enables any entity that was denied payment of a pharmacy bill submitted from Jan. 1 to March 31, 2014 to resubmit the bill if payment was denied for failure to include a copy of the prescription. It allows payers to request copies of prescriptions for a review of records of prescriptions dispensed by a pharmacy.

Electronic Transmittal of Policy Info (SB 251, Calderon): Allows insurers to electronically transmit offers of renewal, notices of conditional renewal and offers of coverage, and sets requirements for doing so.

Compounding Pharmacies (SB 294, Emmerson): Prohibits pharmacies without a California Sterile Compounding Pharmacy License from compounding or dispensing sterile drug products for injection, ocular administration or inhalation, and requires out-of-state pharmacies compounding these products for shipping to California to have such a license as well. Also requires the pharmacies to allow annual inspections and removes the option for accreditation from outside agencies.

SB 863 Technical Corrections (SB 375, Senate Labor Committee): Corrects erroneous cross-references included in Senate Bill 863 – including changing a reference to “administrative hearing” interpreters to “medical examination” interpreters – and making technical, clarifying, and conforming changes with respect to the provisions.

OSHA Standards – Meal/Rest/Recovery Periods (SB 435 Padilla): Applies Cal/OSHA’s heat illness prevention standard and other Cal/OSHA regulations to laws covering meal breaks and rest and recovery periods.

Paid Leave of Absence for San Diego Lifeguards (SB 527, Block): Enables full-time, year-round lifeguards employed by the City of San Diego to be eligible for “4850 leave” following a work injury.

Overprescribing Investigations (SB 670, Steinberg): Bolsters state medical board investigations of doctors suspected of overprescribing. Enables the board during investigations involving the death of a patient to inspect and copy the patient’s medical records by providing a written request declaring that after reasonable efforts, it is unable to locate or contact the patient’s beneficiary or representative. The bill also expands the definition of unprofessional conduct to include a physician’s repeated failure without good cause to be interviewed by investigators and allows an administrative law judge to issue an interim order limiting the physician’s authority to prescribe, furnish, administer or dispense controlled substances.

CURES (SB 809, DeSaulnier): Assesses an annual $6 fee on provider and dispenser licenses to fund the Controlled Substance Utilization Review and Evaluation System (CURES) monitoring program. The changes also require the state Medical Board to develop and distribute to physicians and acute care hospitals materials on assessing a patient’s risk of abusing or diverting controlled substances and information about CURES, and require the state to streamline the application and approval process for medical providers and pharmacists to access CURES.

Workers’ Compensation Death Benefits for Dependent Children (AB 607, Perea): Enables a deceased employee’s totally dependent children to receive workers’ comp death benefits irrespective of whether the employee’s surviving spouse is totally dependent.

Occupational Safety Standards for Hazardous Drugs (AB 1202, Skinner): Requires the Occupational Safety and Health Standards Board to establish safety and health standards for health care facilities with employees who work with or near antineoplastic drugs used in chemotherapy, which may cause rashes, infertility, miscarriages, and birth defects, and have been linked to a variety of cancers. The standards must be consistent with, but not exceed, National Institute for Occupational Safety and Health recommendations.

Limits on Workers’ Comp Claims by Professional Athletes (AB 1309, Perea): Restricts cumulative trauma and occupational disease claims by professional athletes in five sports (baseball, basketball, football, ice hockey and soccer), especially those who played for out-of-state teams, under specified conditions. According to the bill’s author, the California Insurance Guarantee Association has paid nearly $42 million in claims to professional athletes since 2002. An average of 34 new claims are being filed each month.

Interpreters (AB 1376, Hernandez): Delays DWC’s workers’ comp qualified medical interpreter certification regulations, required by SB 863, from taking effect until March 1, 2014.

State Compensation Insurance Fund Executive Appointments (AB 1394, Assembly Ins. Committee): Allows the State Fund Board of Directors to appoint a chief medical officer, a chief actuarial officer, a chief claims operations officer and a chief of internal affairs.

As for the next session or the next, both workers’ pundits expect to hear a growing cacophony from the chorus of workers’ comp stakeholders as the positive and negative impacts of SB 863 begin to be felt.

The workers’ compensation office in Goleta – the only one in the county and open since 1999 – is being closed on November 30 with all of its clients and employees transferred to the Oxnard branch. The state’s Department of Industrial Relations (DIR) announced the decision last month.

At the City Council meeting of October 1, 2013 Goleta Mayor Aceves sought Council concurrence to agendize a letter opposing the proposed closure of the local Division of Workers’ Compensation District Offices by the State Department of Industrial Relations (DIR).

The agenda item noted that “It is unclear from the press release or the articles written on the closure what the exact motivation is to close this office and whether or not it is part of a statewide consolidation effort. No local hearing or outreach was conducted by the State Division of Workers’ Compensation (DWC) regarding this proposal. Moreover, the goals to be achieved and options considered were never shared with the public. Accordingly, the public was never given the opportunity to be part of the solution.”

“We regret any inconvenience,” said DIR spokesperson Peter Melton. “Because [Oxnard is] less than an hour away, the decision was made to merge the offices.” Melton added that the closure is mainly due to the building’s monthly rent – more than $20,000 – and the increased space at the Oxnard office. He added that the Goleta branch – the only one closing right now – is one of the smallest out of the state’s 24, with only one judge and 1,254 hearing requests so far this year.

Aceves said he hopes the letter results in a public hearing or perhaps a compromise in which cases are held in Goleta a couple of days per week. There is no word on whether other cities in the county plan on taking similar action. Employees at the Goleta office said they couldn’t comment on the closure.

Megan Compton, an attorney for the Santa Barbara law firm Ghitterman, Ghitterman and Feld, which handles many workers’ compensation cases, said she worries how this closure will impede not only people with legal representation but also those without. And those with severe disabilities and/or without cars will be further hindered, she said, as the trip from Goleta to Oxnard would take more than three hours and four buses.

Governor Brown signed new law clarifying a death benefit presumption.

Existing law provides that totally dependent minor children of the deceased worker shall receive death benefits until the youngest child attains 18 years of age, or until the death of a child physically or mentally incapacitated from earning, at a weekly rate of at least $224. Existing law conclusively presumes, for the purpose of determining the amount of workers’ compensation benefits, that children under 18, or certain adult children, who were living with the employee-parent at the time of injury resulting in death, or for whose maintenance the employee-parent was legally liable at the time of the injury resulting in death, is wholly dependent for support on the deceased employee-parent if there is no surviving totally dependent parent.

A.B. 607 eliminates the requirement that, in order to conclusively presume that children under 18, or certain adult children, are wholly dependent for support on the deceased employee-parent, there not be a surviving totally dependent parent.

According to the sponsor, the Police Officers Research Association of California (PORAC), this law was necessary to clarify the rights of totally disabled children of employees who have died on the job to receive dependent death benefits. PORAC claims that an unusual phrase in the statute appears to limit the scope of death benefits to cases where there is a merely partially dependent surviving spouse, but denies the expanded “disabled child” death benefit where there is a fully dependent surviving spouse. The bill deletes this offending clause, thereby ensuring that totally disabled dependent children regardless of age obtain the death benefit to which they should be entitled.

While PORAC is the sponsor of this measure, the death benefit being addressed by the bill is not one of the “special” public safety officer benefits that are afforded to defined police and firefighters. Rather, this new law applies to the totally disabled dependent children of any employee who dies as a result of a job-related injury.

While there does not appear to be any rigorous quantification of the extent to which the new law might expand the number of cases where this death benefit is awarded, after legislative consultation with representatives of employer organizations, the consensus seemed to be that there are relatively few cases, and of those, the beneficiaries were probably intended to be covered by the existing statute.

Back in 2002, AB 749 enacted a broad range of workers’ compensation benefit increases, notably in the amounts paid for permanent disabilities. However, one small piece of that measure adopted the language at issue in AB 607. While it remains unclear precisely what was intended by the 2002 language when it was enacted, correcting the resulting confusion seems consistent with the intent of the original enactment.

Governor Brown signed AB 1376 which Delays until March 1, 2014, a regulation adopted by the Division of Workers’ Compensation (DWC) that requires medical interpreters in the workers’ compensation system to be certified. The bill is deemed an urgency measure and thus takes effect immediately.

The regulation that was is in place prior to this measure being signed by the Governor, provides for three pathways for an interpreter to become certified. First, an interpreter who is on the existing State Personnel Board (SPB) list is automatically certified – however, the SPB has not updated its list in several years, and it is not “open” for new applicants at this time. An interpreter can also seek certification by passing either the Certification Commission for Healthcare Interpreters (CCHI) exam, or the National Board of Certification for Medical Interpreters (National Board) exams. Representatives of interpreters indicate that it can take up to six months to navigate these certification processes. The bill provides approximately six and a half months from the effective date of the regulation for uncertified interpreters to obtain the necessary certification.

According to proponents of this law, Voters Injured At Work (VIAW), the regulation adopted by the DWC was not able to include a delayed implementation date that would allow interpreters adequate time to comply with the specific certification requirements allowed by the regulation. As a result, VIAW claimed that an insufficient number of certified interpreters will lead to delays in obtaining medical treatment for injured workers who require an interpreter to effectively communicate with their physician.

Prior to the passage of last year’s workers’ compensation reform bill, SB 863 (DeLeon), multiple stakeholders reported significant abuse and serious problems with how medical interpreters were provided to injured workers. One of the most common complaints was the use of non-certified medical interpreters providing interpretive services to injured workers. These non-certified interpreters (also known as provisionally certified interpreters) were largely unregulated

Kan-Di-Ki, LLC, doing business as Diagnostic Laboratories and Radiology has agreed to pay $17.5 million to resolve allegations that it submitted false claims to Medicare and Medi-Cal that were tainted by a kickback scheme.

Diagnostic Labs, which is headquartered in Burbank, provides lab and x-ray services to patients at skilled nursing facilities (SNFs) in Southern California. SNFs, commonly known as nursing homes, are a healthcare option for senior citizens who are in need of constant medical attention.

Diagnostic Labs allegedly charged SNFs below cost rates for Medicare Part A business, in exchange for the facilities’ provision of Medicare Part B and Medi-Cal business back to Diagnostic Labs;This scheme is alleged to have violated the federal Anti-Kickback Act (42 U.S.C. § 1320a-7b(b)(2)(A)) and the federal and state False Claims Acts.

“When medical facility owners illegally offer discounts to customers to generate business, it results in inflated claims to government health care programs and increases costs for all taxpayers,” said Glenn R. Ferry, Special Agent in Charge for the Los Angeles Region of the Department of Health and Human Services’ Office of Inspector General; “This $17.5 million settlement demonstrates OIG’s ongoing commitment to safeguarding federal health care programs and taxpayer dollars against all types of fraudulent activities.”

The United States will receive $12.95 million of the settlement amount, and California will receive $4.55 million.

This settlement resolves a lawsuit filed under the qui tam, or “whistleblower,” provisions of the federal and state False Claims Acts, which allow private citizens with knowledge of fraud to bring civil actions on behalf of the federal and state governments and share in any recovery;The case was filed in 2010 in federal court in Los Angeles by two former Diagnostic Labs employees, and is titled United States and State of California ex rel. Pasqua et al. v. Kan-Di-Ki, LLC, Civil Action No. CV10-0965 JST (RZx) (C.D. Cal.); The two men who filed the lawsuit, Jon Pasqua and Jeff Hauser, will collectively receive $3,755,500 as their share of the federal recovery.  Their share of the state recovery has not yet been determined.

The United States Attorney’s Office for the Central District of California, the Justice Department’s Civil Division, and the California Attorney General’s Office handled the civil settlement.  This matter was investigated by the U.S. Department of Health and Human Services, Office of Inspector General.