Category: Daily News

The Division of Workers’ Compensation (DWC) has posted the 2012 Ethics Advisory Committee’s annual report on its Web site. The Workers’ Compensation Ethics Advisory Committee is a state committee, independent from the DWC, charged with reviewing and monitoring complaints of misconduct filed against workers ’ compensation administrative law judges. The nine-member Ethics Advisory Committee is required to make a public report each year summarizing activities in the previous calendar year.

As civil servants, the WCALJs are not subject to review by the California Commission on Judicial Performance, the agency which is responsible for investigating misconduct complaints directed at judges serving on the Supreme, Superior and Appellate courts. The EAC’s authority and duties are set forth in the California Code of Regulations, title 8, sections 9722 through 9723.

The EAC meets at regular intervals to review complaints of judicial misconduct and to make recommendations to the Chief Judge and the Administrative Director of the DWC if a complaint warrants a formal investigation by the Administrative Director’s staff. Pursuant to California Code of Regulations, title 8, section 9722, the Ethics Advisory Committee is composed of nine members, each appointed by the Division of Workers’ Compensation’s Administrative Director for a term of four years. The EAC’s composition reflects the constituencies within the California workers’ compensation community, and is composed of a member of the public representing organized labor; A member of the public representing insurers; A member of the public representing self-insured employers; An attorney who formerly practiced before the Workers’ Compensation Appeals Board and who usually represented insurers or employers; An attorney who formerly practiced before the Workers’ Compensation Appeals Board and who usually represented applicants (injured workers); A presiding judge; A judge or retired judge, and, two members of the public outside the workers’ compensation community.

The EAC meets four times each year at the DWC Headquarters located at 1515 Clay Street, in Oakland, California. Although EAC meetings are open to the public, the Committee meets in executive session when it engages in the review and discussion of actual complaints, and that portion of the proceedings is closed to the public.

In 2012, the DWC had authority over 168 active judges. The EAC received 19 new complaints in the calendar year of 2012, 6 complaints resulted in investigations. The complaints set forth a wide variety of grievances. Three complaints were filed by employees represented by attorneys. Nine by non represented attorneys. One by a defense attorney. And one each by a hearing rep, lien claimant, and an attorney representing a lien claimant.

The Ethics Advisory Committee identified no judicial misconduct in 15 complaints, and did not recommended further action by the Chief Judge or the Administrative Director on any complaints. Three complaints presently remain pending and under investigation from complaints filed in 2012.

Wider adoption of electronic health recrords (EHR) is critical to the broader health care improvement efforts, including efficiencies within the workers’ compensation health system. These efforts – improving care coordination, reducing duplicative tests and procedures, and rewarding hospitals for keeping patients healthier – are all made possible by widespread use of EHRs. Health IT systems give doctors, hospitals, and other providers the ability to better coordinate care and reduce errors and readmissions that can cost more money and leave patients less healthy. In turn, efforts to improve care coordination and efficiency create further incentive for providers to adopt health IT.

HHS Secretary Kathleen Sebelius announced this week that more than half of all doctors and other eligible providers have received Medicare or Medicaid incentive payments for adopting or meaningfully using electronic health records (EHRs). HHS has met and exceeded its goal for 50 percent of doctor offices and 80 percent of eligible hospitals to have EHRs by the end of 2013.

Since the Obama administration started encouraging providers to adopt EHRs, usage has increased dramatically. According to the Centers for Disease Control and Prevention survey in 2012, the percent of physicians using an advanced EHR system was just 17 percent in 2008. Today, more than 50 percent of eligible professionals (mostly physicians) have demonstrated meaningful use and received an incentive payment. For hospitals, just nine percent had adopted EHRs in 2008, but today, more than 80 percent have demonstrated meaningful use of EHRs.

“We have reached a tipping point in adoption of electronic health records,” said Secretary Sebelius. “More than half of eligible professionals and 80 percent of eligible hospitals have adopted these systems, which are critical to modernizing our health care system. Health IT helps providers better coordinate care, which can improve patients’ health and save money at the same time.”

The Obama administration has encouraged the adoption of health IT starting with the passage of the Recovery Act in 2009 because it is an integral element of health care quality and efficiency improvements. Doctors, hospitals, and other eligible providers that adopt and meaningfully use certified electronic health records receive incentive payments through the Medicare and Medicaid EHR Incentive Programs. Part of the Recovery Act, these programs began in 2011 and are administered by the Centers for Medicare and Medicaid Services and the Office of the National Coordinator of Health Information Technology.

Congress is again being asked to amend the Medicare Secondary Payment Act, just six months after enacting reform legislation dealing with the issue, which took five years to pass congressional muster. The Medicare Secondary Payer and Workers’ Compensation Settlement Agreements Act of 2013 was introduced this month in the House, sponsored by Rep. Dave Reichert, R-Wash., and Mike Thompson, D-Calif. The new legislation seeks to reform the processes and procedures used by Centers for Medicare and Medicaid Services (CMS) in its review of workers’ compensation settlement agreements.

According to the story in Property Casualty 360, strong supporters include members of the American Insurance Association and the Coalition for Medicare Secondary Payer Reform. The bill seeks to resolve the serious delays and confusion in the review of workers’ compensation Medicare set- asides by CMS, says to Melissa Shelk, AIA vice president for federal affairs, and Douglas Holmes, president of Strategic Services on Unemployment and Workers’ Compensation (UWC) and coordinator of the Coalition for Medicare Secondary Payer Reform.

“The CMS workers’ compensation Medicare Set-Aside (WCMSA) review process is broken, and this legislation seeks to fix the costly delays and problems within the system,” Shelk said. “We believe that the CMS review process needs clear and consistent standards, timely resolution of coverage decisions and the ability to enable appeals when necessary.”

Holmes said reform is being sought because the current procedure for review of workers’ compensation settlements provides no effective recourse. He said, “There is no avenue to compel a timely decision or appeal a bad one. The legislation introduced by Representatives Reichert and Thompson corrects this situation and many other costly problems and delays, for the benefit of all parties involved.”

In December, Congress passed legislation sought by the insurance industry and other stakeholders since late 2008 that streamlines enforcement of the Medicare Secondary Payment program. The legislation is H.R. 1063, the SMART Act, or The Strengthening Medicare and Repaying Taxpayers Act. The bill is example of how difficult it is to get special interest legislation through Congress is so difficult. The SMART Act was first introduced in Congress in the fall of 2010, but momentum for passage was not generated until last September, when the House Energy and Committee staff coalesced on a rewritten bill crafted with bipartisan support and passed it in late September.

The reason that bill finally got through Congress is that supporters included plaintiffs and defense attorneys, brokers, insureds, insurers, insurance and trade associations, self-insureds and third-party administrators.

The DWC published the following update on the processing of QME panels

“The Department of Industrial Relations (DIR) and the Division of Workers’ Compensation (DWC) are commencing a thorough review of the existing delays in processing represented injured workers’ requests for Qualified Medical Examiner (QME) panels. DIR is committed to addressing the root cause of the delays and is taking steps to ensure that it is addressed systemically .

The delays were eliminated in the past through significant amounts of overtime work by DWC staff as well as the use of temporary student assistants. While those efforts were successful in the short-term, they were not sustainable, leading to reoccurring problems in processing QME panel requests for represented injured worker cases.

All available resources are currently being directed towards reducing the timelines in represented cases. We are conducting a thorough review of the work processes and the applicable regulations, and exploring long-term solutions to reduce the amount of staff time required to process panel requests and make the process more efficient. A technological infrastructure repair is underway.

We further estimate a reduction in the rate of incoming panel requests after July 1, 2013, when Independent Medical Review becomes applicable to all dates of injury. We are confident that the combination of re-directing resources, implementing new technology and the expected IMR – related decrease in panel requests will result in the permanent elimination of the processing delays . Thank you for your patience during this transition.”

CorVel Healthcare, a workers’ compensation system MPN, terminated the contract of Douglas J. Roger M.D., an orthopedic surgeon for two reasons: First, he was unreachable by independent reviewing physicians hired by the network to evaluate four nonstandard treatments he was regularly prescribing for his workers’ compensation patients. Second, he was prescribing those nonstandard treatments on a wholesale basis, and not taking the time to justify their application to particular patients. The Court of Appeal in the unpublished case of Roger v. CorVel Healthcare held that CorVel was well within its rights in terminating his contract.

The case becomes more complicated. The MPN did not comply with the contract as regards the process of termination. The contract provided for a graduated, three-step disciplinary process based on first, second, and third offenses: first a warning letter, second a set of counseling “sessions,” and only then, third, actual termination. And that did not happen. The network terminated the physician after one lengthy telephone discussion with one independent reviewing physician about one patient. The record is clear that Dr. Roger was not about to change his practice to conform to the network’s utilization review procedure, either by making himself readily accessible for peer review consultations, or by taking the time and effort to justify his nonstandard treatments on a patient-specific basis.

Dr. Roger regularly prescribed four nonstandard treatments for his workers’ compensation patients. The first is known as a “surface EMG.” An EMG can be done by needle, which is considered a separate procedure from surface EMGs, or it can be done by surface electrodes – hence the term “surface EMGs.” Surface EMG’s are controversial. Insurers, generally speaking, don’t like them. The other nonstandard treatments were two ointments and one “medical food.” The two ointments were a capsaicin compound referred to by the parties as wasabi-rub, the other a compound of various ingredients called Gaba-2K rub. The “medical food” was theramine tablets.Dr. Roger did not dispute that none of these four treatments are recommended for use in the medical treatment utilization schedule (MTUS) adopted by California Division of Workers’ Compensation. He prescribed them over 90 times, either individually or in some combination, over the course of the year following his sign-up with CorVel. And in each of those more than 90 cases, the proposed treatment was not “certified” for payment. Dr. Roger denigrates the non-certification memos as “cut and paste jobs” performed by nurses rather than actual doctors (even though they were signed by doctors), but cites no evidence to that effect. But Dr. Roger made himself practically unreachable during his tenure with CorVel. He testified he operated four offices during this period, and he had a personal policy of never returning any phone call from an independent reviewing physician unless he was at the office where the patient’s file was kept.

Even worse – and “worse” is the precise word the trial judge used for it – Dr. Roger resorted to the unethical practice of upcoding in order to be paid for the surface EMGs he prescribed.

Dr. Roger’s main theme, which is that a network like CorVel has no business telling fully qualified physicians – under the guise of utilization review – that they can’t prescribe what they think is best for their patients if it is otherwise perfectly legal. The Court of Appeal noted that “Dr. Roger himself was perfectly willing to accept denial of a prescribed treatment and simply assert a workers’ compensation lien later.”

The Court of Appeal affirmed the trial court judgment that Dr. Roger take nothing by his breach of contract action. The Court noted that “While Dr. Roger’s workers’ compensation business may have declined considerably as a result of his termination, we cannot say that his termination was as a result of CorVel’s failure to follow the three-step termination process. Termination was inevitable, independent of that process.”