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Category: Daily News

Contracting Industry Injuries Highest in Opioid Use

Strong responses to the opioid epidemic have led to decreased opioid use over the past five years. However, has the decline been consistent across industries?

A new article published by the National Council on Compensation Insurance (NCCI) explores the difference in opioid use between industry groups by looking at data-driven trends underlying opioid prescribing patterns in workers compensation – with a special focus on the contracting industry.

Studies have shown that certain industry groups have been more prone to opioid use and abuse than others. Further, NCCI data shows that the treatment of injured workers in certain industry groups is significantly more likely to include opioids. For example, in the contracting industry, the quantity of opioids prescribed to injured workers is more than double the average number prescribed to those in all other industry groups.

The share of claims receiving an opioid is greater for the contracting industry group (20%) when compared with all other industry groups combined (14%).

This means that, on average, one out of every five contracting claims involves at least one opioid prescription. In addition, these contracting industry group claimants, on average, receive both 20% more opioid prescriptions and opioid prescriptions that are 20% stronger.

One factor contributing to the higher opioid usage in the contracting industry group is the greater likelihood for serious injuries to occur. Higher medical costs are typically associated with more serious injuries-claims that may be more likely to require pain management efforts, including the potential use of opioids.

For accidents occurring in 2017, the average medical cost per claim, including prescription costs, in the contracting industry group was approximately 2.3 times greater than that for all other industry groups combined.

Opioid usage has experienced decreases in recent years, including among the contracting industry. Between 2012 and 2017, overall, per-claim opioid usage fell by 49% in the contracting industry group.

Decreased opioid usage in the contracting industry group can be primarily explained by a combination of two factors: fewer claimants receiving an opioid prescription, and a reduced number of opioid prescriptions for those who do receive them.

WCRI Reports on Workers’ Compensation Prescription Regulations

The Workers Compensation Research Institute (WCRI) released a new report that gathers in one place the numerous state regulations affecting drugs prescribed to workers with injuries in all 50 states and the District of Columbia.

“Across the country, states have implemented an array of different regulatory strategies, overseen by different agencies, to address prescribing of medicine,” said Ramona Tanabe, WCRI’s executive vice president and counsel.

“This report provides policymakers and system stakeholders with a basic understanding of the different strategies adopted by states, with references to the regulations for those seeking more detail.”

The report, Workers’ Compensation Prescription Drug Regulations: A National Inventory, 2020, also provides information on some of the most prominent prescription drug issues stakeholders are concerned about today, such as the following:

— Rules for Limiting and Monitoring Opioid Prescriptions
— Medical Marijuana Regulations
— Workers’ Compensation Drug Formularies
— Prescription Drug Monitoring Programs
— Price Regulations for Pharmacy- and Physician-Dispensed Drugs
— Drug Testing Regulations

The tables in this report were compiled from completed surveys of two agencies for each of the 50 states and the District of Columbia as of January 1, 2020.

For more information or to purchase, visit its website.

Global Insurance Fraud Detection Market to Grow 22% Annually

Analysts predict the Global Insurance Fraud Detections market to show a compound annual growth rate of 21.66% from 3.7 billion in 2019 to reach 12 billion by 2026.

The major factors contributing to the growth of the market are the need to manage huge volumes of identities by organizations productively, increasing operational efficiency and improving the customer experience, growing adoption of advanced analytics techniques, and stringent regulatory compliance requirements.

The global Insurance Fraud Detection Market is bifurcated into Fraud Analytics, Authentications, Governance Risk and Compliance, and others.

Fraud analytics is expected to constitute the largest market share. Such systems track and analyze data from multiple data sources, identify anomalies and suspicious and irregular activity across all channels, and provide real-time control mechanisms to prevent fraudulent practices. Hence, leading to the growth of the segment.

The emergence of advanced solutions such as the use of automated business rules, self-learning models, text mining, image screening, network analysis, predictive analytics, and device identification is estimated to deliver actionable insights to advance claims processes.

As a result, insurance organizations are adopting fraud detection solutions that not only recognize the genuine claims process but also decrease the number of false positives.

Various factors, such as a rise in the sophistication level of cyber-attacks and enormous monetary losses due to these attacks in the insurance sector, are anticipated to drive the market. An increase in the generation of enterprise data and its intricacy, high industry-specific requirements, and an increase in the incidence of fraud further supplement the fraud detection market growth.

With the growing awareness of criminals and sophisticated crimes, fraud prevention and detection capabilities are increasing. Global concerns about the constantly increasing cases of insurance fraud, coupled with sophisticated organized crime, have signaled the need for all insurance companies to act consistently.

Different factors, such as an exponential rise in cyber-attack sophistication and substantial monetary losses due to these assaults in the insurance sector, are expected to drive the market.

DWC Posts Draft Revisions to the Pharmaceutical Fee Schedule

The Division of Workers’ Compensation has posted draft revisions to the Official Medical Fee Schedule regulations that govern the maximum reasonable fee for pharmaceuticals dispensed to injured workers.

Under the California Labor Code, the fee schedule for dispensed pharmaceuticals is based primarily upon the Medi-Cal pharmacy payment system. Medi-Cal has implemented a revised payment methodology approved by the Centers for Medicare and Medicaid Services (CMS) utilizing “National Average Drug Acquisition Cost” (NADAC) based upon survey data compiled by CMS instead of the “average wholesale price” (AWP).

The new Medi-Cal methodology also revises the pharmacy dispensing fee value and structure by updating the dispensing fee from $7.25 to a two-tier dispensing fee of $10.05 or $13.20, depending on the volume of pharmacy claims processed.

DWC proposes to amend the workers’ compensation pharmaceutical fee schedule in accordance with the provisions of Labor Code section 5307.1, and in light of the Medi-Cal payment system changes.

The proposed regulations set forth separate provisions for pharmacy-dispensed and physician-dispensed pharmaceuticals in order to implement statutory provisions with additional fee caps for some physician-dispensed pharmaceuticals.

The regulation draft would:

— Amend existing regulations in the Physician Fee Schedule (Sections 9789.12.1, 9789.13.2, 9789.13.3) that cross reference to the pharmaceutical fee schedule
— Amend existing Pharmacy Fee Schedule regulation (Section 9789.40)
— Adopt new Pharmaceutical Fee Schedule regulations and structure; separate provisions for pharmacy-dispensed pharmaceuticals (Sections 9789.40.1, 9789.40.2, 9789.40.3) and physician-dispensed (Sections 9789.40.4, 9789.40.5) pharmaceuticals
— Amend Official Medical Fee Schedule section 9789.111 which sets forth effective dates

The draft regulations, a sample excerpt of the fee data file, a sample excerpt of the dispensing fee file and background information on the Medi-Cal fee methodology changes are available on the DWC Forum webpage under “current forums.” Comments will be accepted on the forum until 5 p.m. on Friday, July 3, 2020.

SCIF Sent Back to Trial After a 15 Year Premium Collection Effort

ReadyLink Healthcare is a nurse staffing company based in Thousand Palms, California. It contracts with registered nurses and other healthcare providers throughout the United States, and places them at hospitals, on a short-term basis.

SCIF and ReadyLink have been engaged in a multiyear, multijurisdictional dispute over the final amount of workers’ compensation insurance premium that ReadyLink owes to SCIF for the 2005 policy year, based on an audit of ReadyLink’s payroll for that year performed by SCIF. During the audit, SCIF determined that certain payments made by ReadyLink to its nurses, which ReadyLink characterized as per diem payments, should instead be considered to be payroll under the relevant workers’ compensation regulations. SCIF’s audit resulted in a significant increase in ReadyLink’s premium.

After 15 years of litigation attempting to collect additional premium from its insured, the State Compensation Insurance Fund was sent back essentially to square one to a trial court in Riverside. The convoluted litigation history is enough to give anyone a headache.

ReadyLink first challenged SCIF’s application of the regulations by filing an appeal of the audit to the Insurance Commissioner. The Commissioner approved SCIF’s application of the relevant regulation.

A trial court then rejected ReadyLink’s petition for a writ of administrative mandamus to prohibit the Insurance Commissioner from enforcing its decision, and an appellate court affirmed the trial court’s judgment.

While ReadyLink’s appeal from the trial court’s denial of its petition for a peremptory writ of administrative mandamus was pending, ReadyLink filed a putative class action lawsuit in federal district court against SCIF and the Insurance Commissioner.  (ReadyLink Healthcare, Inc. v. State Compensation Ins. Fund (9th Cir. 2014) 754 F.3d 754, 757).

The federal district court dismissed the case concluding that it was appropriate to decline to exercise supplemental jurisdiction over the remaining state-law claims. While ReadyLink’s federal appeal was pending, California’s Second District Court of Appeal issued its opinion in ReadyLink Healthcare affirming the trial courts ruling.

SCIF then filed the action underlying this current appeal in Riverside County Superior Court on January 13, 2015. SCIF alleged causes of action against ReadyLink for breach of contract, money due on an open book, and common count. The trial court ultimately granted SCIF’s motion for judgment on the pleadings, finding that the amount owed was precisely what was determined in the underlying administrative decision and appeals, the amount of $555,327.53, plus prejudgment interest of $571,606.99.

ReadyLink appealed the money judgment in favor of SCIF. The Court of Appeal reversed in the new published opinion of SCIF v ReadyLink Healthcare inc.

A review of ReadyLink Healthcare, supra, 210 Cal.App.4th 1166, demonstrated that the issues that remain to be decided in this collection action were not previously considered, let alone decided, in the appellate review from the writ proceeding.

The single issue before the ALJ was whether SCIF’s inclusion as payroll those amounts that ReadyLink paid to its employee nurses as per diems for the 2005 policy year complied with the California Workers’ Compensation Uniform Statistical Reporting Plan.

In its ruling on ReadyLink’s petition for a writ of administrative mandamus, the trial court did not suggest that the dispute involved other questions, such as the total amount of the premium owed by ReadyLink, or whether SCIF’s past conduct in relation to ReadyLink might provide a legal basis for ReadyLink to avoid having to pay the premium for the 2005 policy year as determined by SCIF.

The trial and appellate courts in the federal action did not consider, much less decide, the question of the amount of premium actually owed by ReadyLink for workers compensation insurance for the 2005 policy year.

Thus, the Court of Appeal’s review of the collateral proceedings between ReadyLink and SCIF makes clear that the trial court erred in concluding that the issues raised by SCIF’s collection action and by ReadyLink’s affirmative defenses to that action had been litigated and decided in a prior action.

The judgment of the trial court was reversed. The trial court’s order denying ReadyLink’s motions to compel further discovery was also reversed.

ACOEM Studies Employer Costs for Opioid Use Disorders

A new study published in the Journal of Occupational and Environmental Medicine concluded that employers can make a business case for expanding access to pharmacotherapy treatment for Opioid Use Disorder (OUD) based on its finding that receipt of pharmacotherapy significantly reduces overall health care costs.

Prior research has measured the impact of employee opioid use disorder (OUD) on employer costs. One study found that employees who are dependent on opioids but have not been diagnosed with OUD have lower at-work productivity, which costs employers approximately $16 million a year.

Another study using 2006 to 2012 data reported that individuals with OUD had seven more medically related absenteeism days annually relative to matched controls.

A third study found that US adults who misuse prescription pain relievers have higher work absenteeism than do employees who do not.

Studies focusing on health care costs have found that individuals who misuse opioids have more than $10,000 more in annual expenditures.

However, employers do not have a recent or full picture of costs related to OUD. Employees who have a spouse or dependent with an OUD may have additional lost productivity days and days absent because of family member health concerns. Employees may have to help their family member navigate health care benefits during business hours, including identifying appropriate and available providers for substance use disorder (SUD).

Employees also may assume a caregiving role, particularly during relapse or potential relapse. A cross-sectional study of caregivers of individuals with advanced cancer found a 23% drop in average productivity. Another study that looked at caregivers of patients with poststroke spasticity found that lost-productivity cost per employed caregiver was $835 per month, with 72% attributable to presenteeism.

To update this information, ACOEM researchers conducted a cross-sectional analysis of 2016 to 2017 commercial enrollment, health care, and pharmacy claims and health risk assessment data using the IBM® MarketScan® Databases (Ann Arbor, MI).

The results of the new study were consistent with previous research that found that employers incur significant costs from OUD. The findings add to the literature by providing evidence that employers would benefit financially from expanding access to pharmacotherapy for their employees with OUD.

Employers should work with other payers to tackle important barriers to treatment for OUD by supporting efforts to expand provider education and licensure requirements to include MAT and increasing insurance coverage for these treatments.

3M Sues California Company Selling Fake N95 Masks

3M’s legal battle to keep price gougers from profiting on sales of its N95 face masks during the coronavirus pandemic grew on new fronts.

The Star Tribune reports that on Monday, 3M targeted a third-party seller on for using its trademark to sell $350,000 worth of masks at up to 20 times list prices.

KM Brothers Inc., a California company trading under several different business names, “claimed to be reselling authentic N95 respirators, while actually selling damaged and fake goods at highly inflated prices,” 3M said.

After customer complaints, Amazon pulled the KM Brothers ads from its online shopping forum.

3M’s federal court lawsuit against Mao Yu, the owner and operator of KM Brothers, explains a strategy that uses multiple business names to carry on selling if a single business gets taken down.

3M said that on Feb. 20, various business under KM Brothers control began selling “what were purported to be 3M-branded N95 respirators across three connected accounts on”

The company also “maintained at least 45 different Amazon Standard Identification Numbers.”

The new lawsuits offer a glimpse into the depth and breadth of attempts to profit from a national shortage of N95 masks, said to be among the most effective in blocking airborne COVID-19 molecules.

The new legal actions bring to 14 the number of suits 3M has filed since January to try to control price gouging for its product by what the company calls “pandemic profiteers.”

3M said it “has won five temporary restraining orders and three preliminary injunction orders from courts across the country that put a stop to other defendants’ unlawful and unethical profiteering from the pandemic.”

It has shut down more than 3,000 websites and 4,000 social media posts that try to expropriate the 3M brand for profit, the company explained.

3M asks the court to shut down KM Brothers’ mask-selling operations and to force the company to repay any profits derived from by claiming the resale of 3M masks when it was instead “selling counterfeit, damaged, deficient, or otherwise altered masks.”

The seller charged Amazon customers up to $23.21 for a single mask that normally listed for prices ranging from 60 cents to $3.40 each. Customer complaints tipped off Amazon.

Reopenings Continue Despite COVID-19 Hotspots

Facing budget shortfalls and double-digit unemployment, governors of U.S. states that are COVID-19 hotspots on Thursday pressed ahead with economic reopenings that have raised fears of a second wave of infections.

Governors face pressure to fire up economies facing fiscal year 2021 budget shortfalls of up to 30% below pre-pandemic projections in New Mexico. Nevada, which has seen cases increase by nearly a third in the past two weeks, is suffering 28% unemployment.

Reuters reports that the moves by governors of states such as Florida and Arizona came as Treasury Secretary Steven Mnuchin said the United States could not afford to let the novel coronavirus shut its economy again and global stocks tanked on worries of a pandemic resurgence.

As Florida reported its highest daily tally of new coronavirus cases on Thursday, Governor Ron DeSantis unveiled a plan to restart public schools at “full capacity” in the autumn, arguing the state’s economy depended on it.

North Carolina reported record COVID-19 hospitalizations for a fifth straight day on Thursday, a day after legislators passed a bill to reopen gyms, fitness centers and bars in a state where more than one in ten workers are unemployed.

“This is about saving lives, this is also about livelihoods in the state of Arizona,” Governor Doug Ducey told a news briefing, adding that a second shutdown of the economy was “not under discussion” despite official figures showing a 211% rise in virus cases over the past 14 days.

About half a dozen states including Texas and Arizona are grappling with rising numbers of coronavirus patients filling hospital beds.

Ducey and Texas Governor Greg Abbott say their hospitals have the capacity to avoid the experiences of New York, where the system was stretched to near breaking point as some COVID patients were treated in hallways and exhausted workers stacked bodies in refrigerated trailers.

A note of caution came from Utah, where Governor Gary Herbert said most of the state would pause its reopening after a 126% rise in cases over the past two weeks.

Austin, Texas on Thursday also said it would likely extend stay-at-home and mask orders past June 15 after the state reported its highest new case count the previous day. Austin health officials blamed a record week of infections on easing business restrictions and Memorial Day gatherings.

There was no talk of new shutdowns.

In New Mexico, Health Secretary Kathy Kunkel pointed to outbreaks at the Otero County Prison Facility, as well as in nursing homes and assisted living facilities, as factors behind an uptick in cases.

California PUC Rules Rideshare Drivers are Employees

The California Public Utilities Commission said in an order Tuesday that drivers for Transportation Network Companies (TNCs), which include services like Uber and Lyft, are considered employees under AB-5, the state’s hotly debated new gig work law.

“For now, TNC drivers are presumed to be employees and the Commission must ensure that TNCs comply with those requirements that are applicable to the employees of an entity subject to the Commission’s jurisdiction,” wrote commissioner Genevieve Shiroma.

The ruling from CPUC, the agency in charge of regulating ride-hail companies, marks a significant development in the battle over the employment status of tens of thousands of gig workers in California.

According to the report in Business Insider, both companies criticized the ruling, saying it could hurt drivers’ wages and pointing to a ballot measure they support that would revoke the law.

CPUC’s presumption is flawed; drivers are correctly classified as independent contractors and overwhelmingly want to remain independent contractors,” a Lyft spokesperson told Business Insider. “Forcing them to be employees will have horrible economic consequences for California at the worst possible time.”

“Uber remains committed to expanded benefits and protections to drivers,” a company spokesperson told Business Insider. “If California regulators force rideshare companies to change their business model it could potentially risk our ability to provide reliable and affordable services along with threatening access to this essential work Californians depend on.”

Ride-hailing companies like Uber and Lyft have been at the center of AB-5, which went into effect this year and made it more difficult for companies to classify employees as independent contractors.

While many drivers and labor groups have praised AB-5, it has also received intense pushback from some corners. Beauticians, truckers, freelance writers and workers in industries long dominated by contractors have said the law is too far-reaching, for example.

AB-5’s most ardent opponents, however, have been its intended targets: gig work companies.

Last year, Uber sued California, seeking an exemption from AB-5, and along with Lyft and various food delivery apps, has publicly argued that its drivers should not be classified as employees, called on taxpayers to foot the bill for drivers’ unemployment insurance, and poured millions into a ballot measure aimed at revoking the law.

Uber and Lyft have so far refused to reclassify drivers under AB-5, leading city attorneys general from Los Angeles, San Francisco, and San Diego to sue the companies to force them to comply with the law. More than 4,000 drivers across the state have also taken action by filing $1 billion worth of back wage claims, driver group Rideshare Drivers United said in a statement.

The COVID-19 pandemic has brought new scrutiny to the labor practices of gig work companies like Uber and Lyft, with drivers facing a steep drop in income, struggling without healthcare or paid time off, and unable to claim unemployment insurance.

California Agricultural Industry Braces for COVID-19 Claims

From apple packing houses in Washington state to farm workers in Florida and a California county known as “the world’s salad bowl,” outbreaks of the novel coronavirus are emerging at U.S. fruit and vegetable farms and packing plants.

Reuters reports that a rising number of sick farm and packing house workers comes after thousands of meat plant employees contracted the virus and could lead to more labor shortages and a fresh wave of disruption to U.S. food production.

The Trump administration said last month it may extend an executive order to keep meat plants operating to fruit and vegetable producers as well, a sign it is concerned fresh produce could be the next sector hit.

While social distancing can be more easily implemented for workers harvesting fruits and vegetables in fields and working outside may reduce some risks for virus spread, plants that package foods such as apples and carrots resemble the elbow-to-elbow conditions that contributed to outbreaks at U.S. meat packing plants.

By late May, there were more than 600 cases of COVID-19 among agricultural workers in Yakima County, Washington. Of those, 62% were workers in the apple industry and other packing operations or warehouses, according to a Reuters review of data from county health officials.

With 4,834 known cases as of June 10, the county had the highest per-capita infection rate on the West Coast.

“The (production) line moves super fast. And you’re working side by side and back to back,” said Edgar Franks, political director with local farmworker union Familias Unidas por la Justicia in Washington state.

Workers at six fruit packing sites in Yakima County went on strike in May due to concerns they were not being provided adequate protection from COVID-19, Franks said.

The health department in Monterey County, California, known as “the world’s salad bowl” for its sprawling vegetable farms, reported 247 agricultural workers had tested positive for coronavirus as of June 5, 39% of county’s total cases. Monterey is one of only a handful of health departments in nearly 30 of the largest U.S. fruit and vegetable producing counties that tracks virus cases among agricultural workers, Reuters found.

On May 19 the U.S. Agriculture Department and Food and Drug Administration said the government could use the Defense Production Act to keep fruit and vegetable lines moving. The act would give companies some liability protection if workers fall sick.

An FDA spokesperson said the act could be used “to protect the food supply and prevent significant food shortages.”

U.S. Senator Debbie Stabenow, a Michigan Democrat, said in an interview with Reuters farm workers face increased risks as fruits like apples and cherries enter harvest season.

Stabenow, ranking member on the Senate Agriculture Committee, introduced legislation on May 27 that would offer companies grants and loans to upgrade machinery and purchase personal protective equipment, fund COVID-19 testing and facility cleaning.

“You can get ahead of this, which is what didn’t happen in the meatpacking situation,” she said. “The best way to protect our supply chain is to keep workers safe.”

Meanwhile, coronavirus cases near tomato-growing Immokalee, Florida, are also on the rise. The spread of the coronavirus among Florida farm workers has significant implications for national food production, as many agricultural workers travel north through the summer following the harvest through Georgia, the Carolinas, and into the Northeast.

The Florida Department of Agriculture is planning for more on-farm outbreaks by partnering with county health departments, hotels for quarantine housing, and educating workers.