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The Institute for Clinical and Economic Review (ICER), a small but influential Boston-based research group, has signed a deal with private technology company Aetion to help it use patient health data in its reports on whether individual drugs are priced properly.

Large national regulators, including the U.S. Food and Drug Administration and United Kingdom’s National Institute for Health and Care Excellence (NICE), are considering increasing the use of data gathered outside of clinical trials on the effectiveness of treatments, often referred to as real-world data.

The FDA is running a pilot project using Aetion’s technology to analyze insurance claims to try to replicate clinical trial results, as part of a requirement to comply with healthcare legislation called the 21st Century Cures Act. It is seeking to determine under what circumstances such data could replace clinical trials, which have long been the foundation of medicine regulation.

Former FDA Commissioner Scott Gottlieb is a board member at Aetion.

The agreement with Aetion, which licenses the required claims data, will allow ICER to better inform its cost-effectiveness reports beyond clinical trial data and other information provided by patients, pharmaceutical companies and research papers.

ICER will pilot the use of real world analysis in follow-up reports on how patients are being prescribed and how they react to treatments that have reached the market through one of the FDA’s accelerated approval pathways.

ICER President Steve Pearson said it can use data collected by Aetion to analyze the standard of care for a disease, or to see if larger numbers of patients in medical practice react similarly to drugs as those in tightly controlled clinical trials.

For instance, he said, patients may be taking different dosages than given in trials, which could impact the cost effectiveness of a drug.

ICER is not a government agency and has no authority to set prices. But many large health insurers take their reports into account when they negotiate prices with drug manufacturers and determine patient access. Drugmakers also take into account ICER estimates when they set prices for new medicines.

New York-based Aetion has funding from venture capitalists including from units of Amgen and McKesson, as well as from drugmakers Sanofi and Ucb and health insurer Horizon Health Services ...
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/ 2020 News, Daily News
Some of the industry’s largest pharmaceutical companies, including Pfizer and Eli Lilly have developed a blockchain-based system to track prescription drugs across the supply chain to better halt the flow of counterfeit medicines.

Some two dozen companies in the industry including drugmakers, distributors, retailers and delivery firms created the blockchain-based MediLedger Network, which it has been testing in the verification of drug returns. They said they intend to further expand the system this year.

Blockchain, which first emerged as the technology underlying virtual currency bitcoin, is a shared database maintained by a network of computers.

The MediLedger group submitted a report to the U.S. Food and Drug Administration laying out the benefits of blockchain for this specific issue, Susanne Somerville, chief executive officer at technology company Chronicled, told Reuters.

The company claims that Blockchain has the capacity to break apart the silos dividing pharmaceutical suppliers and customers, while also building bridges for secure record keeping of each transaction that protects every party and ensuring fidelity across supply chains.

"Even though the drug supply in the United States is safe, there are small percentages - of potential counterfeit drugs. Certainly, there’s a lot of evidence of diverted drugs," Somerville told Reuters in an interview.

She said counterfeit drugs are a big problem in third world countries, where it is estimated that half of their drugs are counterfeit. "This is a plan intended that this never happens in this country."

Among the 24 participating companies are Amgen, FedEx, GlaxoSmithKline, Novartis, AmerisourceBergen, Sanofi, Walgreens Boots Alliance and Walmart.

The World Health Organization estimates that counterfeit medicines worth $79.26 billion are traded annually.

"The current point-to-point systems infrastructure lacks the ability to keep data in sync across the healthcare supply chain, which ultimately increases the risk of counterfeit, diverted or otherwise illegitimate products," David Vershure, head of channel and contract management for Roche’s Genentech unit, said in a statement.

The core function of the MediLedger Network is to validate the authenticity of drug identifiers throughout the supply chain, the MediLedger report said. This can all be done without any proprietary data being shared openly on the blockchain or ever leaving a company’s control.

The MediLedger project was created in response to the FDA’s call early last year for pilot projects testing an electronic inter-operable system as outlined in the Drug Supply Chain Security Act (DSCSA) ...
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/ 2020 News, Daily News
Medicare Secondary Payer (MSP) is the term generally used when the Medicare program does not have primary payment responsibility (that is, when another entity has the responsibility for paying for medical care before Medicare). These entities with primary payment responsibility include GHPs and NGHP entities, such as liability insurers (including self-insured entities), no-fault insurers, and workers’ compensation arrangements.

Section 111 of the Medicare/Medicaid SCHIP Extension Act (MMSEA) of 2007, at its most basic level, requires insurers and self-insureds to both identify Medicare beneficiaries with whom they pay benefits or settlements associated with workers’ comp, no fault or liability claims and - once identified - report data to Medicare as directed by the Secretary of Health & Human Services.

The reporting act originally mandated that failure to comply with the reporting requirements "shall be subject to a civil money penalty of $1,000 for each day of noncompliance" for each individual for which the information should have been submitted.

Enter the SMART Act. On January 10, 2013, President Obama signed into law the Medicare IVIG Access and Strengthening Medicare and Repaying Taxpayers Act of 2012. The SMART Act, among other things, softened the language relative provide CMS with discretion not only to the imposition of the penalty but also into the amount of the penalty.

Now, civil money penalties "may be (rather than shall be) subject to a civil money penalty of up to $1,000 for each day of noncompliance with respect to each claimant." The SMART Act also required the Secretary to quickly solicit proposals determining "specified practices for which such sanctions will and will not be imposed" via the regulatory process.

About a year after the SMART Act was signed into law, CMS kicked off the rulemaking process with an advance notice of proposed rulemaking (ANPRM). Now, nearly a decade later, CMS has proposed the penalty rules for non-reporting or improper reporting.

This proposed rule will ensure that the appropriate insurers are compliant with their reporting requirements and primary payment responsibilities for healthcare services covered by their healthcare coverage programs. A 60-day public comment period seeks feedback on the proposals.

Here are some highlights of the proposed rule.

-- Under the proposed new rule, should a GHP fail to perform the required Section 111 reporting within one year of the coverage effective date, it would be subject to a CMP of $1,000 for each day of noncompliance for each individual whose coverage information should have been reported. A maximum penalty of $365,000 per individual per year would apply.
-- Should it fail to perform the required Section 111 reporting at all within one year of the date a settlement or other payment obligation was established, an NGHP would be subject to a CMP of up to $1,000 for each day of noncompliance for each individual whose information should have been reported. A maximum penalty of $365,000 per individual per year applies.
-- Entities that have performed Section 111 reporting as required, but subsequently provide information that contradicts reported information in response to MSP recovery efforts, would be subject to a CMP based on the number of days that the entity failed to appropriately report updates to beneficiary records. For GHP entities, penalties would be $1,000 per day of noncompliance per individual. For NGHP entities, the penalty would be up to $1000 per day of noncompliance, for a maximum penalty of $365,000 (365 days) per individual.
-- CMS has proposed an error tolerance that would not exceed a 20% threshold. In the public comment period it is seeking feedback on the threshold value for entities that have submitted their Section 111 reporting and Medicare identifies data errors. Reported information that exceeds any of the established error tolerance(s) threshold(s), and exceeds those tolerances for any four out of eight consecutive reporting periods, would be subject to a CMP with the fourth occurrence above the tolerance submission.

The proposed rule can be found online ...
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/ 2020 News, Daily News
Improving employment conditions and equity markets have driven the workers’ compensation insurance industry’s performance in recent years. IBISWorld reported that the industry saw 2.1% annual growth from 2013 to 2018. Meanwhile, the National Association of Insurance Commissioners (NAIC) reported that the industry amassed $58 billion in direct written premiums in 2018. The cumulative market share of the 10 largest insurance groups stood at 45.2%.

Here are the top 10 workers’ comp insurance providers, according to NAIC, ranked by countrywide premium and market share:

1. Travelers Direct Written Premiums: $4.3 billion Market Share: 7.4%

2. Hartford Direct Written Premiums: $3.4 billion Market Share: 5.9%

3. Berkshire Hathaway Direct Written Premiums: $2.8 billion Market Share: 4.7%

4. Zurich Insurance Direct Written Premiums: $2.7 billion Market Share: 4.7%

5. AmTrust Financial Services Direct Written Premiums: $2.6 billion Market Share: 4.5%

6. Chubb Ltd Direct Written Premiums: $2.5 billion Market Share: 4.3%

7. Liberty Mutual Direct Written Premiums: $2.5 billion Market Share: 4.3%

8. New York State Insurance Fund Direct Written Premiums: $2.3 billion Market Share: 3.9%

9. AIG Direct Written Premiums: $1.7 billion Market Share: 2.9%

10. Blue Cross Blue Shield of Michigan Direct Written Premiums: $1.6 billion Market Share: 2.7% ...
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/ 2020 News, Daily News
When an on-the-job injury occurs, the initial response can be critical in aiding an employee in making the right decisions about what type of care they need. Injured workers need to trust that their employer will support them with the resources needed to make the best choices.

Coventry had the opportunity to work with a national client who wanted to evaluate its processes and create a solution to help improve the injured worker experience. They turned to Coventry to enhance their program and decrease lag times from the date an injury occurred to the date it was reported.

To do this, Coventry embarked on a mission to make its nurse resources available to their injured workers immediately to help navigate the most appropriate course of action for a sustained injury. They also had a goal to implement nurse triage into their claims administration and reporting process to achieve the following:

-- Improve the injured worker experience by eliminating confusion and frustration
-- Triage injured workers on a timely basis to the right level of care for the sustained injury
-- Convey that they cared for their employees
-- Reduce the use of the emergency room as a first level provider for non-emergent injuries
-- Offer telemedicine services as a convenient and cost-effective solution for injuries warranting remote assessment -- Reduce litigation due to a lack of understanding the system and benefits available

When injuries occur at work, many employees aren’t sure what to do. They may go to their family health care provider, who may not be in-network, or go to an urgent care clinic or the emergency room. This can result in unnecessary costs and aggravated conditions for employees. In addition, without access to a nurse resource, an injured employee often has to rely on a front-line supervisor to know what to do (i.e., whether to call 911 or tell the employee to go to the emergency room or an urgent care clinic). The consequences of such scenarios can be over- or under-treatment, employees who don’t follow a treatment plan, or an employer/employee relationship that may be on shaky ground. To assist in addressing these concerns,

Coventry developed a nurse triage solution to fit the client’s specific needs, and in 2017 they launched their program with key clients. Here are the results they recently published for this program.

-- Average reporting lag for non-traumatic cases from injury to time of reporting declined from 7.4 days to 1 day
-- Injured employees are put in immediate contact with a nurse and receive the most appropriate course of action
-- Litigation rates dropped 3% and NT24 is considered to be the main attributing factor
-- The experience modification of the program is expected to improve due to fewer medical-only claims being reported -- Average 31% decline annually in medical-only claims resulted in savings in both administrative and medical costs

The program has been a complete success. Not only did it achieve the initial goals of improving the injured worker experience by providing a timely, trusted resource, it also delivered amazing results in the form of reduced reporting lag time, reduced litigation, more appropriate utilization, and financial savings ...
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/ 2020 News, Daily News
Robotics has weaved its way into many different fields, and medicine is no exception; robot-assisted surgery has advanced dramatically over the past decade in almost every surgical subspecialty.

Robot-assisted surgery is usually performed using surgical robot systems that involve a master-slave configuration, in which the "master" is a controller device that the surgeon manipulates to control a robotic arm. Such systems improve the dexterity and precision of surgeons by filtering out hand tremors and scaling their hand motions into smaller movements. They also reduce the risk of common surgical complications such as surgical site infection.

However, robot-assisted surgery comes with its own disadvantages, especially for the person performing the surgery. Robotic surgeons sometimes feel physical discomfort during surgery, with finger fatigue being common.

This discomfort is associated with the way in which they grip the master controller. Two types of grips are usually used to control surgical robots: the "pinch grip" and "power grip." The pinch grip has been used in conventional surgeries for centuries; it involves using the thumb, middle, and index fingers to achieve high-precision movements.

On the other hand, the power grip involves grabbing a handle with the entire hand and is more suitable for forceful work and large movements.

Because the pinch grip puts tension on certain muscles of the hand and fingers, it is more likely to cause fatigue. And although the power grip does not seem to cause such discomfort, it offers less precise control. Therefore, there is a trade-off between the discomfort caused by the pinch grip and the lack of fine control of the power grip.

Fortunately, Mr. Solmon Jeong and Dr. Kotaro Tadano, a pair of researchers from Tokyo Institute of Technology found a clever solution to this problem. In a study published in The International Journal of Medical Robotics and Computer Assisted Surgery , the researchers speculated that a master controller that combines both types of gripping can be designed.

Dr. Tadano explains, "In robotic surgery, the limitations of the two conventional gripping methods are strongly related to the advantages and disadvantages of each gripping type. Thus, we wanted to investigate whether a combined gripping method can improve the manipulation performance during robotic surgery, as this can leverage the advantages of both gripping types while compensating for their disadvantages."

After a proof-of-concept experiment that yielded promising results, the researchers designed a robotic surgery system with a modular master controller that could be adjusted to employ either pinch, power, or combined gripping. The system was tested through a pointing experiment, in which 15 participants had to control a robotic arm to bring the tip of a needle into target holes in the least amount of time without touching obstacles.

The findings showed that the combined grip yielded better performance in the pointing experiment on various fronts, including number of failures (touching an obstacle), time required, and overall length of the movements performed to reach the targets. Many participants also reported to prefer the combined gripping method over the other two, owing to the ease and comfort in using this method.

This new master controller design could be a step in the right direction in robot-assisted surgery. "The manipulating method of master controllers for robotic surgery has a significant influence in terms of intuitiveness, comfort, precision, and stability.

In addition to enabling precise operation, a comfortable manipulating method could potentially benefit both the patient and the surgeon," remarks Dr. Tadano. Although future work is needed to analyze other variables involved in robotic arm manipulation, this work surely paves the way for advanced surgical robot systems ...
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/ 2020 News, Daily News
Amid an industrywide price-fixing probe that has roped in some of the largest generics players, three executives have faced federal charges for their alleged roles. Now, the wide-ranging probe has snared another former exec - this time a big fish at Novartis' generics unit.

Hector Armando Kellum, a former senior executive at Sandoz, pleaded guilty to federal conspiracy charges for his role in a scheme to fix prices for a range of the drugmaker's products, including topical steroid clobetasol and antifungal nystatin triamcinolone cream.

Kellum faces 10 years in prison and a $1 million fine, prosecutors said in a release. In exchange for his plea, Kellum agreed to cooperate with the ongoing federal investigation.

Kellum's plea has now confirmed Sandoz's role in the scheme - easily the biggest company so far - but more generics giants could be in the firing line as the lineup of cooperating witnesses expands.

Kellum's deal comes just two weeks after prosecutors charged Ara Aprahamian, a former sales executive at Taro Pharma. Aprahamian was charged Feb. 4 to three counts of conspiring to fix prices for the company's generic drugs and lying to investigators.

Aprahamian was targeted for his stints as vice president of marketing and VP of sales and marketing between 2013 and 2016, during which he spearheaded two separate price-fixing campaigns with unnamed drugmakers in New Jersey and Pennsylvania then later lied about his role in the schemes, prosecutors said.

Federal prosecutors called Kellum and Aprahamian "co-conspirators" in the price-fixing scheme, with Kellum's role falling between March 2013 and at least June 2015.

The report in FiercePharma also notes that in addition to Aprahamian, Jeffrey Glazer and Jason Malek, the former CEO and president of Heritage Pharmaceuticals, respectively, inked deals in 2017 to settle charges leveled the month before.

Prosecutors have also brought cases against two New Jersey-based drugmakers - including Heritage - for their roles in price-fixing schemes. In those cases, Rising Pharmaceuticals agreed in December to pay $3 million in exchange for a guilty plea in a scheme to set prices for hypertension med Benazepril HCTZ. Heritage reached a deal in March to pay $7 million to cooperate with the feds in their probe.

Kellum's plea has now confirmed Sandoz's role in the scheme - but more generics giants could be in the firing line.

In May, 44 states launched a mammoth case against 20 generic drug makers that Connecticut Attorney General William Tong called "the largest cartel case in the history of the United States."

The suit directly named Maureen Cavanaugh, Teva's former SVP and chief commercial officer in North America, and three lower-level executives who no longer work at the company. Aside from Teva, the lawsuit implicated Sandoz, Mylan, Pfizer and several other leading generic drug makers. It names current and former executives from Lupin, Glenmark and other companies ...
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/ 2020 News, Daily News
Since 1913, the National Safety Council has used data, expertise and innovation to solve some of the toughest workplace safety problems. Yet over the past decade, as workplace injuries have declined, the number of fatalities has remained relatively flat, even increased in some years.

The Council’s Work to Zero initiative, supported by a grant from the McElhattan Foundation, aims to make workplace deaths a thing of the past.

Using decades of insight, data and an unparalleled network of safety leaders, it will identify the most promising technological innovations for eliminating workplace fatalities in our lifetime. In short, Work to Zero will serve as a hub of digital transformation in safety.

Work to Zero launched its first research report, Safety Technology 2020: Mapping Technology Solutions for Reducing Serious Injuries and Fatalities in the Workplace, at its inaugural Summit. The paper reviews the current state of safety technology, provides insight from interviews with more than 40 EHS professionals, and maps major sources and causal factors of workplace deaths to promising safety technologies.

The report looks at 18 different non-roadway hazardous situations in which workers are most likely to die and provides anywhere from five to eight potential technology solutions for each situation.

The Work to Zero Advisory Council is a volunteer group of EHS and technology experts composed of industry, academic, government and other thought leaders who strategically advise the Council on efforts to eliminate workplace deaths. Its primary responsibilities are to inform Work to Zero research projects by providing expertise, insight and access to networks that enrich the initiative, shape outreach and event projects, and engage external parties to broaden the initiative’s reach and knowledge.

The Advisory Council meets via bi-monthly teleconference meetings and bi-annual face-to-face meetings, such as at the NSC Congress & Expo, Campbell Institute Symposium and/or Annual Work to Zero Summit. If you are interested in learning more, email ...
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/ 2020 News, Daily News
California Department of Insurance detectives arrested Jonathan Quezada, 28, on multiple felony counts of insurance fraud and workers’ compensation insurance fraud after he allegedly falsified an insurance claim to receive unearned workers' compensation benefits costing Californians over $22,000.

Quezada was working as a cook at an IHOP in La Mesa when he fractured his clavicle. He filed a workers’ compensation claim with his employer stating he got hurt at work while performing his normal job duties and told his employer and insurance representatives that he was cleaning grill grates in the IHOP kitchen when he slipped and fell.

After receiving a referral from the Preferred Employers Insurance Company, the California Department of Insurance launched an investigation which revealed Quezada lied about the circumstances of his injury.

Surveillance video showed he was injured at work, but that his injury was a result of play wrestling with a coworker, not performing his normal job duties as he claimed.

Quezada’s allegedly false statements allowed him to receive workers’ compensation benefits he was not entitled to, which cost Californians $22,781.

"The workers’ compensation system is intended to help honest workers who get hurt while doing their jobs get the benefits and assistance they need to support themselves and their families while they recover," said Insurance Commissioner Ricardo Lara. "When people file fraudulent workers' compensation claims they take advantage of this system and cost Californians millions of dollars every year in higher premiums."

Quezada was arrested on February 12, 2020, and was booked at the Sacramento County Jail. Bail was set at $25,000. The San Diego District Attorney’s Office is prosecuting this case ...
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/ 2020 News, Daily News
Following several lawsuits in Arizona and Florida, GEICO has filed a federal lawsuit in California alleging an auto glass repair shop submitted fraudulent glass repair bills.

GEICO seeks to recover damages alleging violations of the Civil RICO statute and the California Business and Professional Code as well as claims for common law fraud and unjust enrichment.

GEICO alleges that owners Tal Elzari and Navid Vatankhahan used their business, Winaffix Auto Glass, in a fraudulent scheme to overbill for windshield glass replacement.

Their alleged scheme involved creating false glass invoices designed to mimic those from legitimate car dealerships in order to fraudulently claim they were using expensive original equipment glass rather than less expensive alternative glass. In fact, it is alleged that Winaffix never purchased the glass their invoices claimed. They are also alleged to have performed glass replacement services without a license to do so.

GEICO says it intends to file future lawsuits in California and around the country in its continuing efforts to protect its customers and the public from fraudulent glass repair operators.

"GEICO is committed to protecting our customers from the negative effect that insurance fraud has on premiums," said James Jones, assistant vice president of claims in GEICO’s Poway, California, office. "These incidents of fraud hurt consumers in California because they cause premiums to increase, and we will continue to pursue them with a zero tolerance."

Jones went on to say that GEICO has a long history of seeking out individuals and companies willing to commit fraud.

GEICO filed its case - Government Employees Insurance Company, et al. v. Winaffix Auto Glass, et. al. (2:20-cv-01401) - in the U.S. District Court for the Central District of California.

GEICO also seeks a declaration that any pending claims are not owed. GEICO is represented by Barry Levy and Steven Henesy of Rivkin Radler, LLP and Jean M. Daly and Tyler E. Sanchez of Murchison & Cumming, LLP ...
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/ 2020 News, Daily News
In a unanimous decision, the California Supreme Court in the case of Frlekin v. Apple Inc., just held that the time spent by employees waiting for and undergoing security checks of bags and other personal items is compensable time under California law, even when the policy only applies to employees who choose to bring personal items to work.

In California, employees in most industries must be paid for the time they are subject to the control of their employer, not just the time spent doing work. This is so because, since 1947, California has specifically departed from federal law and has provided greater protection to working employees.

Fisher Phillips points out that over the last several years, the question of whether the time employees spent having their bags checked at work is compensable has arisen in several different contexts, in California and across the country:

-- In late 2014, the U.S. Supreme Court held that security checks are not compensable time under federal law because they are not part of the actual workday.
-- However, because California law requires employees to be compensated not only when they are working but also when they are subject to their employer’s control, the trial court in this case certified a statewide class on Apple’s security check policy in 2015.
-- A few months later, the trial court found in Apple’s favor finding that, because employees can choose whether or not to bring a bag into work, the application of the security check policy depended entirely the employees’ choice.
-- Last year, the 9th Circuit Court of Appeals found that the time spent on mandatory security checks at Nike and Converse stores was likely compensable under California law, since California law no longer follows the federal “de minimis” doctrine that allows employers to not compensate for tasks that take only a short amount of time.

The California Supreme Court agreed in it's new decision, that employee choice is a consideration but ruled that it was not the only consideration. Instead, the court provided a multi-factor test within which to analyze the employee-choice issue. Particularly with respect to "onsite employer-controlled activities," whether the time is compensable depends on a number of factors, which include:

-- The mandatory nature of the activity;
-- The location of the activity;
-- The degree of the employer’s control;
-- Whether the activity primarily benefits the employee or employer; and
-- Whether the activity is enforced through disciplinary measures.

In this case, the Supreme Court found that the time spent on bag checks at Apple cut in favor of compensable time under several of these factors: it occurred on the employer’s premises, employees subject to the policy were prevented from leaving the premise while waiting for and undergoing the security check; it was enforced through disciplinary measures; and, rejecting Apple’s argument that security checks benefit employees, the court found that the security check policy primarily benefited the employer as a theft prevention measure ...
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/ 2020 News, Daily News
Elisha Harden claimed injury to her cervical spine, lumbar spine and psyche on November 14, 2012 while employed as a probation assistant by the County of Sacramento.

The parties agreed to use Peter Mandell, M.D., as the orthopedic AME. Dr. Mandell evaluated applicant and issued reports addressing her industrial injury.

Joseph McCoy, M.D., evaluated applicant in 2016 as an orthopedic independent medical examiner (IME) in relation to her application for disability retirement. Richard Lieberman, M.D., evaluated applicant in 2016 as a psychiatric IME also for her claim for disability retirement. As part of Dr. Lieberman's examination, applicant was given psychological testing, which was independently scored by psychologist Bernard Bauer. All reports were addressed to the Sacramento County Employees Retirement System.

On April 24, 2019, defendant served applicant with a copy of the reports of Dr. McCoy, Dr. Lieberman and Dr. Bauer. Defendant's cover letter with these enclosures stated: "We will be providing these medical reports to QME Dr. Wantuch and AME Dr. Mandell in 20 days absent a timely objection from your office."

On May 8, 2019, applicant sent a response to defendant's letter objecting to providing these reports to the AME.

The sole issue at the trial held on July 10, 2019 was "Whether the reports of Dr. Joseph McCoy, Dr. Richard Lieberman, and Dr. Bernard Bauer obtained in the disability retirement proceeding shall be provided to the QME Dr. Elizabeth Wantuch and Dr. Peter Mandell over Applicant's objection."

These reports were ordered inadmissible and defendant was ordered not to provide the reports to Dr. Wantuch and Dr. Mandell. Reconsideration was granted in the case of Harden v County of Sacramento.The WCJ order was rescinded, and the reports of Dr. McCoy, Dr. Lieberman and Dr. Bauer may be provided to the orthopedic AME Dr. Mandell and the psychiatric QME. The panel also ordered applicant's objection to provision of these reports to the medical-legal evaluators to be overruled.

"In determining whether to admit evidence, we are governed by the principles of section 5708, which states that the Appeals Board "shall not be bound by the common law or statutory rules of evidence and procedure, but may make inquiry in the manner, through oral testimony and records, which is best calculated to ascertain the substantial rights of the parties and carry out justly the spirit and provisions of this division." (Lab. Code, § 5708.) The right to present evi,dence implicates the right to due process. (Hegg/in v, Workmen's Comp. Appeals Bd. (1971) 4 Cal.3d 162, 175 [36 Cal.Comp.Cases 93]; Pence v, Industrial Acci. Com. (1965) 63 Cal.2d 48, 51 [30 Cal.Comp.Cases 207].)"

Commissioner Razo dissented. "The parties may not circumvent the requirements of section 4062.2 in order to admit into evidence medical reporting that was not prepared in compliance with the Labor Code. Defendant cannot backdoor into the record evidence that implicitly addresses applicant's level of permanent impairment and limitations from her industrial injury, and is therefore inadmissible under section 406l(i). (See Batten v. Workers ' Comp. Appeals Bd (2015) 241 Cal.App.4th 1009, 1014 [80 Cal.Comp.Cases 1256].) The majority view allows parties to circumvent the legislative intent to disallow privately retained medical experts.

The current workers' compensation system in California is designed to provide two separate and structured medical evaluation paths to obtaining medical-legal evaluations. For medical treatment disputes, the Legislature created the utilization review (UR) process and independent medical review (IMR). For other disputes regarding AOE/COE, injury, causation, disability, etc., the Legislature enacted the agreed medical evaluator (AME) and the panel qualified medical evaluator (QME) selection process to enable parties to obtain medical-legal evaluations on these issues.

The legislative intent is to avoid "doctor shopping" and to keep litigation costs down. To allow the parties in this case to deviate from the procedures outlined in sections 4062-4062.2 opens the door to enable other types of medical- legal reports to be admissible outside of the legislative mandated process." ...
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/ 2020 News, Daily News
The Coronavirus has helped expose China's monopoly on drugs, and medical supplies that are essential for healthcare systems such as worker's compensation claims.

In testimony this month before the Senate Committee on Homeland Security and Governmental Affairs, Scott Gottlieb, a physician and the former Food and Drug Administration commissioner in the Trump administration, explained in detail the extent of the U.S. pharmaceutical industry’s dependence on China:

About 40 percent of generic drugs sold in the U.S. have only a single manufacturer. A significant supply chain disruption could cause shortages for some of many of these products.

Last year, manufacturing of intermediate or finished goods in China, as well as pharmaceutical source material, accounted for 95 percent of U.S. imports of ibuprofen, 91 percent of U.S. imports of hydrocortisone, 70 percent of U.S. imports of acetaminophen, 40 to 45 percent of U.S. imports of penicillin, and 40 percent of U.S. imports of heparin, according to the Commerce Department. In total, 80 percent of the U.S. supply of antibiotics are made in China.

While much of the fill finishing work (the actual formulation of finished drug capsules and tablets) is done outside China (and often in India) the starting and intermediate chemicals are often sourced in China. Moreover, the U.S. generic drug industry can no longer produce certain critical medicines such as penicillin and doxycycline without these chemical components.

According to a report from the US-China Economic and Security Review Commission, China’s chemical industry, which accounts for 40 percent of global chemical industry revenue, provides a large number of ingredients for drug products. It’s these source materials - where in many cases China is the exclusive source of the chemical ingredients used for the manufacture of a drug product - that create choke points in the global supply chain for critical medicines.

Moreover, when it comes to starting material for the manufacture of pharmaceutical ingredients, a lot of this production is centered in China’s Hubei Provence, the epicenter of coronavirus. Most drug makers have a one to three-months of inventory of drug ingredients on hand. But these supplies are already being drawn down. Among big [active pharmaceutical ingredient] makers in Wuhan are Wuhan Shiji Pharmaceutical, Chemwerth, Hubei Biocause, Wuhan Calmland Pharmaceuticals.

Gottlieb notes that "80 percent of the U.S. supply of antibiotics are made in China." The sourcing of this estimate is explained in greater detail in section three of the U.S.-China Economic and Security Review Commission’s 2019 report to Congress, titled - Growing U.S. Reliance on China’s Biotech and Pharmaceutical Products."

The report notes that China is "the world’s largest producer of active pharmaceutical ingredients (APIs). The United States is heavily dependent on drugs that are either sourced from China or include APIs sourced from China." The report further explains that although India is the world’s leading supplier of generic drugs, India gets 80 percent of its active pharmaceutical ingredients directly from China. The United States also imports 80 percent of its APIs from overseas (primarily from India and China) and "a substantial portion" of its generic drugs "either directly from China or from third countries like India that use APIs sourced from China."

In other words, almost all pharmaceutical roads lead to China.

Furthermore, the report notes that China’s dominance of the chemical industry and global manufacturing of active pharmaceutical ingredients means that "the world is becoming increasingly dependent on China as the single source for life-saving drugs."

"The U.S. generic drug industry can no longer produce certain critical medicines such as penicillin and doxycycline, and the APIs needed to make these antibiotics are sourced from China," the report states ...
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/ 2020 News, Daily News
The Division of Workers’ Compensation (DWC) has launched an electronic filing pilot program for physicians to submit the Form 5021 Doctor’s First Report of Occupational Illness or Injury (DFR) online.

The pilot is available on a voluntary basis for physicians who agree to send their reports to DWC electronically rather than filing paper forms. Large volume filers such as hospitals are also invited to participate through electronic data interchange (EDI) submission.

Physicians who treat an injured worker are required by the Labor Code to file, within five days after initial examination, a complete report of occupational injury or occupational illness with the employer's insurer or with the employer if self-insured. The forms are currently only available on paper.

As this is a pilot, physicians are not required to participate in the electronic filing program. DWC plans to draft regulations to require electronic reporting in the future with the goal of phasing out paper filing.

DWC has posted a web page with more information on the pilot program. To participate in EDI filing, contact ...
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/ 2020 News, Daily News
A new CWCI study details changes in the utilization and reimbursement of California workers’ comp physician and non-physician medical services from 2013 through 2018 - a 6-year span during which the state transitioned to a Resource-Based Relative Value Scale (RBRVS) fee schedule mandated by 2012 legislative reforms (SB 863).

The study, authored by Stacy Jones, Senior Research Analyst at the California Workers’ Compensation Institute (CWCI) examines data on 35.9 million medical services provided to injured workers in California to measure changes in the mix of services and payments across nine medical service categories from 2013, the last year under the old fee schedule, across 2014 through 2017, the 4-year period during which the state transitioned into the RBRVS schedule, and into 2018, the first year after the new schedule took full effect.

Overall claim volume fell 5.2% from 2013 to 2018, but that only partially explains the 28.4% decline in total service counts (identified by billing codes) and the 20.4% decline in aggregate payments during that period.

Examining the service counts by medical service category reveals wide variation, with reductions ranging from a 17.2% decline in physical medicine services to a 71.8% drop in pathology and laboratory services.

In addition, the study found that the declines in the number of unique claims associated with each service category also varied widely, ranging from a 4.4% decline in claims with physical medicine services to a 42.9% drop in claims with pathology and laboratory services. The varying reductions in the volume of services among the different categories, as well as updates to the service codes and service descriptions included in the new fee schedule, resulted in a reallocation of the fee schedule dollars, with an increased share paying for primary care, and a smaller share paying for specialty services, which was a key goal behind the adoption of the RBRVS fee schedule.

Between 2013 and 2018, the study found total payments for evaluation and management (E&M) and physical medicine services, which together comprised 68.3 percent of primary care delivered to injured workers in 2018, increased by 9.3% and 30.6% respectively, while total payments for the 7 other service categories all declined, dropping between 16.5% and 76.1%.

Some of the disparities between the utilization and total payment trends in the 9 service categories reflected the change in the average payment per service code. Calculating average payments for services in the 9 categories from 2013 through 2018, the study found that despite the reductions in the volume of services, average amounts paid to providers increased in 5 categories, with increases of 2.1% for surgery services; 28.5% for medicine services; 35.9% for durable medical equipment, prosthetics, orthotics and supplies; 39.4% for evaluation and management; and 57.6% for physical medicine.

On the flip side, average payments fell for pathology and lab services (-15.3%); radiology (-17.2%); and special services (-35.6%), where the decline was primarily due to lower report costs which reflect the RBRVS schedule’s elimination of separate fees for consultation services and associated reports.

The full study takes a detailed look at the professional medical service utilization and reimbursement trends, including shifts in the mix of specific services and payments within each of the 9 service categories, and the underlying changes to the fee schedule that prompted those moves.

CWCI has published the study in a Research Update Report, "Trends in the Utilization and Reimbursement of California Workers’ Compensation Professional Medical Services, 2013-2018" which is available to Institute members and subscribers in the Research section of its website ...
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/ 2020 News, Daily News
Ari Herstand is a Southern California musician. Herstand told NBC 7 he relies on booking gigs in local venues to make ends meet but says, that has all changed. Herstand and other musicians said a new labor law is disrupting California's music industry.

"We’re actually thinking of leaving the state of California and going elsewhere because we can’t survive here," said Herstand.

Herstand said Assembly Bill 5 is forcing him to act as an employee and an employer, just to earn money by playing his music.

"The bassists I’d normally cut him a check for $200, well now I have to put this bassist on payroll and pay payroll taxes. I have to incorporate myself, I have to get workers comp insurance, I have to get unemployment insurance, etc," Herstand said.

Herstand said the process will cost him and prevent him from doing what he loves.

"My accountant estimated it will cost me an additional $6,000 a year just to comply with this law and the additional costs," he explained.

AB 5 was co-authored by assemblymember Lorena Gonzalez and supporters said the bill provides benefits to those in the gig economy.

Assemblymember Gonzalez told NBC 7 for more than a year they've been engaging with artists about how this would impact their work.

"It’s completely unrealistic for us to change our entire way of operating for this that wasn’t intended to help or hurt us," said Herstand. "I know assemblywoman Gonzalez did not have ill intention for the music industry when she wrote this bill."

Herstand is hoping to add an exemption to the law. If that doesn’t work, he said he’s teamed up with Senator Brian Jones for senate bill 881 to tackle this issue.

"I never thought when I got into music that one of the most effective, impactful things that I would’ve ever written would be a law for the state of California," he said while laughing.

Assemblymember Gonzalez’s office told NBC 7 addressing the music industry this year is a top priority ...
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/ 2020 News, Daily News
Employers paid out a record $68.2 million to those alleging sexual harassment violations through the EEOC in 2019, shattering the all-time record by over $10 million. The #MeToo movement continues to be a major influence on workplaces across the country.

This is just one of many interesting findings released by the Equal Employment Opportunity Commission (EEOC) in its annual data summary covering fiscal year 2019).

The January 24 release is full of eye-opening statistics that could help set compliance priorities for 2020 and beyond. Here are some thought-provoking takeaways from the EEOC’s annual summary.

The most compelling piece of information from the release is the amount of money recovered from employers in 2019 for claims of sexual harassment. The $68.2 million represents a 20% increase from the previous all-time high set of $56.6 million in 2018, and is nearly double the total from just five years previous ($35 million in 2014).

Claims of sexual harassment remained high in 2019. Although the number of claims dipped slightly from 7,609 in 2018 to 7,514 in 2019, this figure still represents the second-highest mark for claims in the past seven years.

By a very wide margin, the most common EEOC claim employers faced in 2019 involved allegations of retaliation. Once again, these claims proved to be the most popular filed by workers. In 2019, over 39,000 retaliation claims were filed, representing nearly 54% of all claims filed with the EEOC.

The next-highest type of claim filed with the EEOC in 2019 were disability discrimination allegations. Following the passage of the ADA Amendments Act in 2008, there has been a steady increase in the number of such claims. Pre-ADAAA, only 14,893 disability claims were filed, representing under 20% of all EEOC claims. By 2019, that number had jumped to 24,238, accounting for a third of all claims filed.

The EEOC has placed a recent emphasis on efficiency, and the numbers bear out the success that the agency is having in this area. Just two years prior, the EEOC only resolved 125 pieces of litigation, including 109 merits suits (those involving substantive claims, excluding subpoena enforcement or pure requests for preliminary injunctions). By 2019, those numbers increased dramatically. The agency resolved 180 pieces of litigation, including 173 merits cases ...
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/ 2020 News, Daily News
The AARP is fighting case by case to defeat claims that it is cheats consumers who purchase AARP-branded Medicare supplemental health insurance ("Medigap") products by charging illegal commissions.

A non-profit organization that claims to advocate for Americans age 50+, the AARP is facing several lawsuits around the country, including a Washington, DC, lawsuit that is moving forward as a class action lawsuit and two proposed California class action lawsuits that are (for now, at least) not.

Since at least 1997, the AARP has held, in its name, group Medigap policies underwritten by UnitedHealth Group and UnitedHealthcare Insurance Company. For each policy purchased and renewed, the AARP charges an undisclosed 4.95% fee that it maintains is a royalty to compensate AARP for UnitedHealth’s use of its intellectual property.

The plaintiffs in lawsuits against the AARP say it is actually charging a "commission" but disguising it as a "royalty" to avoid oversight by insurance regulators and to avoid paying taxes on the income generated through insurance sales.

The rulings below reflect the dramatically different analysis of the facts by two federal judges in Washington and California.

U.S.District Judge Beryl Howell of Washington, D.C., last fall ruled the case of Krukas v. AARP, Inc, et. al, can proceed as a class action against the AARP, which is headquartered in Washington.

She rejected AARP’s argument the lawsuit should be dismissed because it would force the court to second-guess insurance rates approved by state regulators. Judge Howell said the plaintiffs are not challenging state-approved rates but allege the AARP used unfair business practices and deceptive conduct that prevented consumers from making informed decisions about the cost of AARP-branded insurance.

Judge Howell said the AARP does far more than simply endorse UnitedHealth Medigap policies. She ruled the plaintiffs "provided ample detail concerning AARP’s extensive responsibilities - to allow the reasonable inference that the defendants are merchants."

By contrast, Senior U.S. District Court Judge Dean D. Pregerson of Los Angeles summarily dismissed two proposed class action lawsuits filed against the AARP in California.

Judge Pregerson in 2018 dismissed the case of Levay v. AARP, without allowing the plaintiffs to engaged in discovery, and did so with "prejudice" so the case cannot be refiled. The plaintiffs have filed a notice of appeal with the U.S. Court of Appeals for the Ninth Circuit in San Francisco.

Regarding the AARP’s undisclosed 4.95% fee, Judge Pregerson said, "It would be foolish indeed for an enterprise, regardless of its status as a non or for-profit entity to be blind, all other factors being substantially equal, to revenue generating opportunities." Appeals Court Circuit Decision?

It’s not clear how Judge Pregerson’s ruling in the Levay case squares with a 2017 decision by a three-judge panel of the U.S. Court of Appeals for the Ninth Circuit in response to Judge Pregerson’s dismissal of Friedman v. AARP, Incl, et. al, which also challenged the AARP’s Medigap insurance program.

The panel sent the Friedman case back to Pregerson for reconsideration. He dismissed the case again on November 1, 2019, with instructions that it cannot be refiled. Judge Pregerson criticized the lack of specificity of the third amended complaint and ruled the plaintiff failed to show they suffered any economic harm. Alan I. Schimmel of Sherman Oaks, CA, lead attorney for the plaintiffs, could not be reached for comment about whether the plaintiffs will appeal ...
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/ 2020 News, Daily News
Over the years, there has been a consolidation of most of the U.S. pharmacy benefits business under OptumRx, CVS and Express Scripts. This has not occurred without controversy in workers' compensation claims.

The pharmacy benefit manager administering prescription drugs for workers injured on the job overcharged the Ohio Bureau of Workers’ Compensation on more than 1.3 million claims for generic medications, according to a new court filing by Attorney General Dave Yost’s office.

The report in the Columbus Dispatch says that attorneys for the state asked the court to rule OptumRx breached its contract and is liable for unspecified damages. According to the court filing, OptumRx overcharged the state on 57% of 2.3 million claims between January 2014 and September 2018.

"By failing to follow the pricing rules it agreed to and promised to obey, OptumRx violated its duties to the State of Ohio and BWC and wrongfully pocketed millions of dollars in unearned profits," the court filing says.

The state sued Texas-based OptumRx last March, leading to several months of mediation that failed to resolve the dispute. Late Friday, attorneys for the state filed a motion for partial summary judgment, arguing "there can be no dispute" that OptumRx violated terms of its contract." Attorneys asked the court to determine damages at a later hearing.

In an earlier filing, the state asked for a fine of up to $5,000 for each day that the improper prices were charged, pushing the potential damages into the millions.

OptumRx spokesman Drew Krejci said in response to the latest allegations, "We are honored to have delivered access to more affordable prescription medications for the Ohio Bureau of Workers’ Compensation and Ohio taxpayers. We believe these allegations are without merit and will vigorously defend ourselves."

OptumRx, owned by UnitedHealth Group, was hired by the Bureau of Workers’ Compensation to manage claims, set pharmacy reimbursements and handle other billing matters. The bureau is funded by assessments on employers and spends about $86 million a year on prescription drugs.

The pharmacy benefit manager’s contract with the bureau expired in 2018 and was not renewed.

According to the latest filing by the state, OptumRx agreed to charge the bureau the lesser of four possible prices for generic drugs with the "federal upper limit," a maximum price set by the Centers for Medicare and Medicaid Services for federally funded programs, the most that could be paid.

"The federal upper limit acted as a price ceiling," the filing said. "If the other three prices, (which were set by OptumRx, drug companies and pharmacies, respectively), were higher than the federal upper limit, then the federal upper limit applied."

The filing included an analysis of OptumRx claims data showing the company charged the bureau more than the federal upper limit price on 1.3 million of 2.3 million generic claims. In one example cited, OptumRx charged the bureau $101 for Lamotrigine, used to treat seizures, when the federal upper limit was $55.51, making for a $45.59 overcharge.

In its work for Ohio Medicaid, OptumRx was found to have billed the state $26 million more than it paid pharmacists to fill prescriptions in a one-year period ...
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/ 2020 News, Daily News
The new law, Assembly Bill 5, has generated outrage from a wide range of Californians, from musicians to therapists to truckers and freelance journalists. It requires businesses to classify more workers as employees entitled to benefits like sick leave and overtime pay. But some workers affected by AB 5 say it’s caused them nothing but grief and anxiety.

The Sacramento Bee reports that the Sacramento Jazz Cooperative is a struggling nonprofit, operating on a shoestring budget during its three-year history as it presents Monday night concerts at the Dante Club. Now it has another problem on its hands - the controversial California labor law that requires it to hire musicians as employees.

Since Jan. 1, the jazz co-op has had to contribute to musicians’ Social Security and Medicare, while withholding payroll taxes from their checks. Founder Carolyne Swayze said the law is proving costly to the co-op and threatens its viability, potentially hurting musicians.

"I’m not sure if we can hang in there," she said. "It might be different if we were in Chicago or LA or New York."

Many truckers have made a similar argument about the law, saying it inhibits their ability to do business. The California Trucking Association secured a court injunction blocking implementation of AB 5 in its industry, after it argued the law is preempted by the US Constitution because it interferes with interstate commerce.

Placerville resident Lacey Easton says she’s lost work as a professional sign-language interpreter because of AB 5. She’s down to about 15 to 20 hours of work "in a good week."

"More importantly, deaf and hard-of-hearing people have lost access to communication," said Easton, who does interpreting for schools, job-training agencies and medical appointments.

She said flexibility is extremely important in her profession; that’s why she’s resisted going to work for a company as an employee. Interpreters have to be "compatible" with the person they’re signing for, and if she’s an employee she’d lose the ability to turn down a job.

Critics of the law are fighting back. Some have gone to court. Uber has vowed to challenge the law at the ballot box - while also changing its ride-hailing platform in an effort to have its drivers remain classified as independent contractors instead of employees.

The company, along with Lyft, DoorDash, Instacart and Postmates, is pouring tens of millions of dollars into a proposed ballot initiative that would allow it to continue classifying drivers as independent contractors. Spokesman Davis White said Uber isn’t withholding any payroll deductions from its drivers’ compensation.

At the same time, Uber has changed its platform as a way of trying to work around AB 5.

Its 150,000 California drivers now have the freedom to choose which rides they accept; previously, they had to pick up a customer without knowing the destination. And in late January, Uber launched a pilot project at the Sacramento, Santa Barbara and Palm Springs airports that lets drivers set their prices. The Uber app matches passengers with the driver offering the lowest fare ...
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/ 2020 News, Daily News