A new report by the National Safety Council builds on the Work to Zero Safety Innovation Journey to help organizations assess risks, identify technology solutions and ready workplaces for implementation. Specifically, this white paper, which analyzes academic journals, vendor interviews and company case studies, evaluates the benefits of robotics and autonomous mobile robots, or AMRs, on reducing injuries and fatalities in the workplace. It also outlines best practices employers can follow to implement robotic technology across a range of workplaces. For this white paper, Work to Zero identified the five most common robot configurations available to employers - AMRs, Automated Guided Vehicles or AGVs, Articulated Robots, Humanoid Robots and Cobots - to assess their key benefits and applications. In addition to concluding this technology can be ideal for manufacturing applications, where repetitive, high-volume production is necessary, the report identified several other examples in which employers can use robots to create safer outcomes for their workers, including: - - Inspecting confined spaces and industrial facilities. Organizations in the construction, mining and logging industries may especially benefit from using wheeled AMRs to remove human workers from on-site hazards. - - Transporting parts, goods and materials. Used alongside sensors and computer vision, AMRs and AGVs can minimize the risk of human-machine collisions. - - Using robotic arms for precision cutting and welding, as well as the safe handling of toxic, high-temperature or explosive materials. - - Machine tending and parts repositioning by using robotic arms and AMRs to reduce risks associated with manual machine handling. Work to Zero also found adopting robotic technology can help employers mitigate the risk of workplace musculoskeletal disorders, prevent falls from heights and reduce worker muscle fatigue. However, several barriers to widespread robot adoption exist. While recent advancements have reduced the price and increased the viability of robotics for common industrial applications, costs of implementation and ongoing maintenance may still be prohibitive for smaller industrial operations. Additionally, Work to Zero found AVG and AMR configurations may be disruptive to some work environments or need to be coupled with additional safety technologies to effectively mitigate risk. This underscores that, despite the many benefits, employers must tailor their robotic technology to meet their unique safety needs and drive the return on investment. There is also an enduring concern that robotics or other technology may eventually replace human workers, but the report noted that, in addition to robotics having the potential to improve efficiency and safety, increased automation may help businesses reduce costs overall, which can lead to increased investments and the creation of new jobs in other areas, especially in engineering, maintenance and programming. Ultimately, this white paper found the importance in having a proactive approach to addressing the potential consequences of automation, such as retraining and reskilling programs for displaced workers, and ensuring the benefits of automation are shared equitably across organizations ...

Late Friday, a Santa Clara County jury awarded $2 million to Younes Mchaar, a deaf, low-wage, former FedEx Ground part-time package handler who was repeatedly denied reasonable accommodations and the interactive process at the company’s San Jose facility. The jury verdict also found that FedEx failed to prevent this discrimination against him despite FedEx Ground having previously been sued by the U.S. Equal Employment Opportunity Commission (EEOC) on behalf of deaf package handlers nationwide. According to a press release by his attorneys, Mr. Mchaar, who has been deaf since birth, began working at FedEx Ground in 2011 as a part-time package handler in Virginia. Mchaar alleged in his lawsuit, filed in 2020, that after FedEx in Virginia denied him promotions and proper interpretive services from 2011 to 2017, he moved to the San Jose position - anxious, stressed and frustrated but seeking a better workplace and higher pay. Mr. Mchaar transferred to the company’s San Jose, California facility in April 2017, anticipating reasonable accommodations to assist in routine communications. But it took until December 2017 for the company to arrange a meeting with him about reasonable accommodations. At that point, FedEx agreed to provide American Sign Language (ASL) interpreters for all safety meetings and Video Remote Interpreting VRI for daily meetings. Nonetheless, the ASL interpreters were often not present at safety meetings, and the VRI did not even arrive at the facility until June 2018 - after which, it was glitchy. He also discovered that just as in Virginia, "FedEx promoted and assigned important projects to less-qualified, non-deaf employees," according to his lawsuit. After Mr. Mchaar vigorously complained about denied reasonable accommodations, he was written up 10 times in 2 ½ months and proposed for termination, at which point he resigned. According Mercury News, FedEx said in an emailed statement Tuesday that it disagreed with the verdict and was reviewing its options for an appeal. The firm said it "remains committed to the fair and equal treatment of all team members, including our employees who are deaf and hard of hearing, for whom we strive to provide every opportunity for success." Throughout Mchaar’s employment in San Jose, the package-delivery titan had been fighting the U.S. Equal Employment Opportunity Commission in federal court over its treatment of deaf package handlers. "Shipping giant FedEx Ground Package System, Inc., (FedEx Ground) violated federal law nationwide by discriminating against a large class of deaf and hard-of-hearing package handlers and job applicants for years", the U.S. Equal Employment Opportunity Commission (EEOC) charged in a lawsuit it announced. The EEOC says that FedEx Ground failed to provide needed accommodations such as American Sign Language (ASL) interpretation and closed-captioned training videos during the mandatory initial tour of the facilities and new-hire orientation for deaf and hard-of-hearing applicants. The shipping company also failed to provide such accommodations during staff, performance, and safety meetings. Package handlers physically load and unload packages from delivery vehicles, place and reposition packages in FedEx Ground's conveyor systems, and scan, sort and route packages. The EEOC charges that, in addition to failing to provide communications-based accommodations for mandatory meetings, FedEx Ground refused to provide needed equipment substitutions and modifications for deaf and hard-of-hearing package handlers, such as providing scanners that vibrate instead of beep and installing flashing safety lights on moving equipment. The EEOC, after a nationwide investigation, sued FedEx in 2014 (No. 2:15-cv-00256 (W.D. Pa. May 18, 2020) ) under the Americans with Disabilities Act. The agency alleged the company failed to provide reasonable accommodations for deaf and hard-of-hearing package handlers that would let them perform essential job functions, communicate with managers, and participate in meetings. The agency further alleged that FedEx failed to provide flashing lights for safety on motorized moving equipment. In 2020, to resolve the nationwide lawsuit, FedEx agreed to pay $3.3 million to up to 229 people, and agreed in a consent decree to provide deaf and hard-of-hearing package handlers with live and video American Sign Language interpreting, and scanning equipment with non-audible cues, such as vibration. The company also agreed to put warning lights on motorized equipment such as forklifts. The company said Tuesday it has fully complied with the terms of the EEOC settlement agreement, which enabled the deal to expire in May 2022. The lawsuit is Santa County Superior Court Case No. 20CV366270 ...

Grégoire Courtine, a French-born neuroscientist at École Polytechnique Fédérale de Lausanne in Switzerland, is the International Paraplegic Foundation chair in spinal cord repair at the Center for Neuroprosthetics and the Brain Mind Institute at the Swiss Federal Institute of Technology in Lausanne. Courtine and Jocelyne Bloch of HBP partners EPFL and CHUV have created a device that allows patients with total spinal cord injuries to stand, walk, and even participate in recreational activities such as swimming, cycling, and canoeing. The device is called a "digital bridge." The "digital bridge" device is a breakthrough study that could represent a quantum leap in the treatment of certain brain and central nervous system injuries. The device uses artificial intelligence to decode brain signals that enable the patient to move around independently. "When there’s a spinal cord injury, the brain is disconnected from the spinal cord, so the communication is interrupted," said Courtine during a press call Tuesday. "And what we’ve been able to do here is to reestablish the communication between the brain and the region spinal cord that controls leg movement with a digital bridge." That so-called "digital bridge" can effectively turn thought into actions - or, as Courtine put it, it can "capture thoughts" and translate them into a stimulation of the spinal cord. According to the study published in the Journal Nature, the experimental treatment has been tried just once. Gert-Jan Oskan is a 40-year-old Dutch man who suffered a spinal cord injury in a bicycle accident. For nearly 12 years, he was unable to walk, step or stand. Courtine's team implanted two devices, one into Oskan's brain, and another into his spinal cord. The two devices communicate wirelessly, hence the digital bridge, or as the paper calls it, the "brain-spine interface," or BSI. Now, Oskan, whom Courtine calls the first "test pilot" of the newly invented system, has regained function in his knees, hips and ankle joints. He can walk - slowly, with the help of crutches - for about 300 to 600 feet. He can stand, with support from his hands, for two to three minutes at a time. He can even climb a few stairs. Perhaps most remarkably, the treatment appears to work even after the system is shut off. The implant has been life-changing, says Oskam. "Last week, there was something that needed to be painted and there was nobody to help me. So I took the walker and the paint, and I did it myself while I was standing," he says. When Oskam thinks about walking, the skull implants detect electrical activity in the cortex, the outer layer of the brain. This signal is wirelessly transmitted and decoded by a computer that Oskam wears in a backpack, which then transmits the information to the spinal pulse generator. After around 40 rehabilitation sessions using the brain-spine interface, Oskam had regained the ability to voluntarily move his legs and feet. That type of voluntary movement was not possible after spinal stimulation alone, and suggests that the training sessions with the new device prompted further recovery in nerve cells that were not completely severed during his injury. Oskam can also walk short distances without the device if he uses crutches. Bruce Harland, a neuroscientist at the University of Auckland in New Zealand, says that this continued improvement in spinal function is great news for anyone with a spinal-cord injury, "because even if it’s a longer-term chronic injury, there’s still a few different ways that healing could happen". "It’s certainly a huge jump" towards improved function for people with spinal-cord injuries, says neuroscientist Anna Leonard at the University of Adelaide in Australia. And, she says, there is still room for other interventions - such as stem cells - to improve outcomes further. She adds that although the brain-spine interface restores walking, other functions such as bladder and bowel control are not targeted by the device. "So, there’s certainly still room for other areas of research that could help progress improvements in outcomes for these other sort of realms," she says. Antonio Lauto, a biomedical engineer at Western Sydney University, Australia, says that less-invasive devices would be ideal. One of Oskam’s skull implants was removed after about five months because of an infection. Nevertheless, Jocelyne Bloch, the neurosurgeon at the Swiss Federal Institute of Technology who implanted the device, says that the risks involved are small compared with the benefits. "There is always a bit of risk of infections or risk of haemorrhage, but they are so small that it’s worth the risk," she says. Courtine’s team is currently recruiting three people to see whether a similar device can restore arm movements ...

Part II of a California Workers’ Compensation Institute research series on low-volume/high-cost drugs used to treat California injured workers identifies three Dermatological drugs, three Opioids, and three Antidepressants that represent a relatively small share of the prescriptions within their therapeutic drug group, but due to high average reimbursements, have become cost drivers, consuming a disproportionate share of the payments. The report reveals that Dermatologicals were the fourth most prevalent drug category in 2021, with 9.3% of the workers’ comp prescriptions, but ranked second (behind Anti-Inflammatories) in total drug spend, consuming 17.3% of all prescription drug payments. That was up from 12.8% in 2012, which the study ascribes to increased utilization and the emergence of high-priced topical analgesics. Diclofenac sodium topicals jumped from 0.5% of all workers’ comp prescriptions in 2012 to 5.4% in 2021 - fourth among all drugs dispensed that year, and they represented 58.1% of the 2021 Dermatological prescriptions, but with inexpensive generics widely available, their average reimbursement was a relatively low $65, so they consumed only 23.5% of the Dermatological dollars. In contrast, the study notes three other low-volume/high-priced drugs that have become Dermatological cost drivers: - - Diclofenac sodium and adhesive sheets (dispensed as Xrylix kits, in 2021 these kits accounted for just 0.3% of the Dermatological prescriptions, but with an average payment of $4,126, they consumed 7.2% of the dermatological drug spend). - - Lidocaine/menthol (this drug was dispensed in various forms, but NuLido gel and Terocin patches were key cost drivers. Lidocaine/menthol represented only 1% of the Dermatologicals dispensed in 2021, but at an average of $1,050 per prescription, it accounted for 6.2% of the Dermatological payments. - - Diclofenac epolamine (dispensed as Flector patches at an average of $570 per prescription, or as generic equivalents at an average of $577, diclofenac epolamine comprised just 1.7% of the 2021 Dermatological prescriptions, but 5.9% of the payments within the group). Opioid use in workers’ comp has been falling for more than a decade and with the adoption of Opioid and Pain Management Treatment Guidelines in late 2017 and a Formulary in 2018, Opioids’ share of the prescriptions continued to drop, falling to 9.4% in 2021 (down from 29.4% in 2012), while their share of the total drug spend fell to 5.8% (down from 26.7% a decade earlier). At the same time, the mix of Opioids used to treat injured workers shifted. The study noted three low-volume/high-priced Opioids that have become cost drivers within their group: - - Buprenorphine, typically used to treat Opioid Use Disorder for patients in Medication-Assisted Treatment plans, in 2021, it accounted for 5.2% of the workers’ comp Opioids, and with an average payment of $363, it consumed 35.4% of the total Opioid reimbursements - more than any other Opioid. - - Tapentadol HCl, used when other pain medications do not work well or cannot be tolerated, but only available as a brand drug (Nucynta or Nucynta Extended Release) it represented just 0.6% of the Opioid prescriptions, but at $590 per prescription, it accounted for 6.4% of the total Opioid drug spend. - - Oxycodone, prescribed for moderate to severe pain, is available in a variety of generic and brand formulations, including extended-release and abuse-deterrent varieties. In 2021, 5.9% of Opioid prescriptions were for oxycodone, and at $145 per prescription, it consumed 16.0% of all Opioid payments. The top four Antidepressants dispensed to injured workers in 2021 represented nearly 2/3 of the Antidepressants used, but all four were relatively low-cost drugs, so they accounted for only 42.5% of the payments in this drug group. In contrast, the study identified three low-volume/high-priced drugs that consumed a disproportionate share of the Antidepressant drug spend: - - Vortioxetine HBr, used to treat Major Depressive Disorder, remains under patent and is only available as brand-name Trintellex. Available in 5, 10, and 20 mg tablets, this drug carries a black box warning noting an increased risk of suicidal thoughts and behaviors. In 2021, only 1.0% of the Antidepressant prescriptions in California workers’ compensation were for Vortioxetine HBr, but with an average reimbursement of $476, this drug comprised 12.4% of all Antidepressant payments. - - Desvenlafaxine, an extended-release tablet that comes in various strengths, is used to treat major depression. It is available as a brand drug (Khedezla, Pristiq), with average payments as high as $642 per prescription, but since the introduction of generic versions in 2017, brand versions have declined to 14 to 15% of the prescriptions. Payments for generic desvenlafaxine averaged $58 to $66 from 2019 to 2021, which helped drive down the average reimbursement for this drug. In 2021, desvenlafaxine represented 1.0% of workers’ comp Antidepressants, but the average payment was still $131, so it accounted for 3.5% of the Antidepressant payments. - - Bupropion HCl is used to treat depression, anxiety, and other mood disorders, and to aid smoking cessation. Available as a brand drug (Wellbutrin, including an extended-release version that tends to be very expensive), or in generic versions, which accounted for 98% of the Bupropion HCl dispensed to injured workers in 2021. Unlike generics, where the average payment declined from $121 in 2012 to $25 in 2021, over that same decade average reimbursements for brand versions of bupropion HCl increased nearly 10-fold from $267 to $2,614. The dominance of generic buproprion HCl has helped contain the total payments for this drug, but the 2% of the prescriptions dispensed as high-cost brand drugs drove the average payment up to $77 in 2021 -- more than three times the $25 average paid for generics. As a result, bupropion HCl, which accounted for 7.6% of the Antidepressant prescriptions in 2021, consumed 16.3% of the Antidepressant payments. CWCI has published more details and analyses on these drugs in a Spotlight Report, Cost-Driver Medications in the Top California Workers’ Comp Therapeutic Drug Groups: Part II, Dermatologicals, Opioids, and Antidepressants. Institute members and subscribers can log on to www.cwci.org and access the report under the Research tab, others can purchase a copy from the CWCI’s online store. Part III of CWCI’s research on low-volume/high-cost medications will focus on medications found in the Musculoskeletal and Ulcer drug categories ...

Mulberri is a software company that provides a cloud-based platform for small and medium-sized businesses (SMBs) to purchase and manage insurance.The company was founded in 2016 by Hamesh Chawla and is headquartered in Sunnyvale, California. Mulberri's platform uses artificial intelligence (AI) to automate the insurance buying process, making it easier and faster for SMBs to find the right coverage at the best price. The company's customers include businesses in a variety of industries, including retail, healthcare, and technology. Mulberri just announced the launch of its Risk Engine, a first of its kind risk assessment offering for workers compensation underwriters. The Risk Engine, which is already being deployed by customers like Paychex’s PEO department, uses machine learning models to put the information underwriters need at their fingertips, making it possible to make fast, accurate decisions. Workers’ comp is a multi-billion-dollar market, but most existing underwriting processes have not taken full advantage of the power of data, especially AI. Mulberri designed its Risk Engine to meet the needs of underwriters and their customers, extending Mulberri’s existing portfolio of insurance products for payroll businesses, HR providers, brokers and small-medium businesses. "Our mission from day one has been to leverage technology to complement underwriters’ judgment so that the business insurance process can be simple, efficient, and transparent," said Hamesh Chawla, CEO and cofounder of Mulberri. "The Risk Engine is a transformative step forward." Mulberri trained its Risk Engine to determine factors that impact claims based on millions of pieces of information including firmographic information, previous loss experience and workers compensation information. The cloud-based product allows intuitive access to predictions on demand from any SaaS application as well as easy deployment. It also enables users to analyze and score prospects one at a time or in bulk. All data is obfuscated, so PII remains safe. It allows underwriters to make predictions for: - - Claim Propensity - Likelihood of an insured filing a claim in twelve months - - Claim Frequency - Claim repetition in twelve months - - Claim Severity - Severity of the claim should it occur - - Loss Ratio - Likelihood of the loss ratio getting worse than a profitable level Mulberri has won the following awards from Insurtech: - - 2023 Insurtech Innovation Award for Best Insurtech Solution for PEOs and Brokers - - 2023 Insurtech Rising Star Award - - 2023 Insurtech Best of Show Award To learn more about the Mulberri Risk Engine and get a demo , sign up at mulberri.io ...

In 2019 , health insurance giant Humana filed an arbitration claim against Walgreens, a major drugstore chain, alleging that Walgreens had submitted millions of falsely-inflated prescription drug prices for more than a decade. This case arises from Walgreens’ longstanding contracts with Humana to reimburse Walgreens for prescription drugs it dispensed at its pharmacies to people insured by Humana. The dispute centered on the way that Walgreens calculates the "usual and customary" price of prescription drugs. Humana alleged that Walgreens had been inflating these prices in order to overcharge the insurer. Walgreens denied these allegations and said that it was simply following the terms of its contracts with Humana. The arbitrator was Elliot Gordon, a retired federal judge. After a lengthy hearing, the arbitrator ruled in favor of Humana and awarded the insurer $642 million in damages. Walgreens has filed a petition in federal court to vacate the arbitration award, arguing that the arbitrator "rewrote" its contracts with Humana and used a flawed model to assess alleged damages. Walgreens acknowledges that the bar for vacating an arbitration award is high. But they say "it is not insurmountable, however." According to the Federal Arbitration Act (FAA), a party can appeal an arbitration award if the original award contains material and prejudicial errors of law of such a nature that it does not rest upon any appropriate legal basis, or is based upon factual findings clearly unsupported by the record; or if the original award is subject to one or more of the grounds set forth in Section 10 of the FAA for vacating an award. Walgreens also claims that law firm Crowell & Moring should not have been allowed to represent Humana after previously advising Walgreens years earlier on drug pricing matters at the heart of Humana’s 2019 arbitration. Crowell has denied any conflict of interest in representing Humana against the law firm’s former client Walgreens2. Walgreens last year sued Crowell & Moring in District of Columbia Superior Court to immediately stop the large law firm from representing insurer Humana Health Plan Inc in the arbitration with Walgreens over drug pricing, contending Crowell, as its former firm, has violated its ethical duty. A judge in May 2021 ruled that Walgreens’ push for a preliminary injunction against Crowell belonged in front of the arbitrator. Walgreens appealed, and the drug-pricing arbitration moved ahead with Crowell remaining as counsel to Humana. Washington, D.C.-based Crowell has denied any conflict of interest in representing Humana against the law firm’s former client Walgreens. A spokesperson for Crowell on Monday in a statement reviewed by Reuters called Walgreens’ ethics claim "meritless" and said the firm was "confident that the arbitrator’s thorough and well-reasoned award will be affirmed." Walgreens also argues that the arbitrator's award is "manifestly unjust" and should be vacated on that ground as well. Humana has responded to Walgreens' petition, arguing that the arbitrator's award should be confirmed. Humana argues that the arbitrator correctly found that Walgreens breached its contracts and that the damages award is supported by the evidence. Humana also argues that the arbitrator did not abuse its discretion and that the award is not manifestly unjust. The outcome of the case could have a major impact on the pharmaceutical industry and the cost of prescription drugs.If the arbitrator's award is upheld, it could set a precedent that would make it more difficult for pharmacies to inflate prescription drug prices. This could lead to lower prices for patients and could help to reduce the overall cost of healthcare. The outcome of the case is also significant because it could impact the way that arbitration is used to resolve disputes in the pharmaceutical industry ...

The Federal Trade Commission is seeking to block biopharmaceutical giant Amgen Inc. from acquiring Horizon Therapeutics plc, saying the deal would allow Amgen to leverage its portfolio of blockbuster drugs to entrench the monopoly positions of Horizon medications used to treat two serious conditions, thyroid eye disease and chronic refractory gout. The FTC filed a lawsuit in federal court this month to block the transaction, saying it would enable Amgen to use rebates on its existing blockbuster drugs to pressure insurance companies and pharmacy benefit managers (PBMs) into favoring Horizon’s two monopoly products - Tepezza, used to treat thyroid eye disease, and Krystexxa, used to treat chronic refractory gout. Neither of these treatments have any competition in the pharmaceutical marketplace. "Rampant consolidation in the pharmaceutical industry has given powerful companies a pass to exorbitantly hike prescription drug prices, deny patients access to more affordable generics, and hamstring innovation in life-saving markets," said FTC Bureau of Competition Director Holly Vedova. "Today’s action - the FTC’s first challenge to a pharmaceutical merger in recent memory - sends a clear signal to the market: The FTC won't hesitate to challenge mergers that enable pharmaceutical conglomerates to entrench their monopolies at the expense of consumers and fair competition." The proposed acquisition is the largest pharmaceutical transaction announced in 2022. Given how central protecting and growing Tepezza and Krystexxa monopoly revenues are to the deal valuation Amgen calculated for Horizon, Amgen has strong incentives post-acquisition to raise Tepezza and Krystexxa rivals’ barriers to entry or dissuade them from competing as aggressively if and when they gain FDA approval, the agency argues. Amgen said it "remains committed" to completing the Horizon acquisition. This action dovetails with other ongoing work at the Commission in response to widespread complaints about rebates and fees paid by drug manufacturers to PBMs and other intermediaries to favor high-cost drugs at the expense of lower cost drugs. As the Commission explained in a policy statement issued in June 2022, these financial relationships create numerous conflicts of interest and can shift costs and misalign incentives in a way that stifles competition from lower-cost or higher-quality drugs, thereby harming patients, doctors, health plans, and competition. The FTC’s market inquiry examining the business practices of PBMs is also ongoing. California-based Amgen is one of the world’s largest biopharmaceutical companies, with global sales of about $24.8 billion and a product portfolio of 27 approved drugs, including blockbuster drugs Enbrel (for rheumatoid arthritis), Otezla (psoriasis), and Prolia (osteoporosis). The FTC said that "Amgen has for years built its pharmaceutical portfolio through acquisitions, thereby increasing its leverage with the insurers and PBMs that negotiate reimbursement for its products." Horizon, based in Dublin, Ireland and Deerfield, Illinois, is a global biotechnology company with about $3.6 billion in sales that focuses on medicines treating rare, autoimmune, and severe inflammatory diseases. Horizon markets and distributes 11 drug products in the United States, including Tepezza and Krystexxa. In securities filings, Horizon has boasted that its Tepezza "has no direct approved competition," and that Krystexxa "faces limited direct competition." Because of this, Horizon charges extremely high prices for those medications - approximately $350,000 for a six-month course of treatment of Tepezza and approximately $650,000 for an annual supply of Krystexxa. The FTC claims that Amgen has a history of leveraging its broad portfolio of blockbuster drugs to gain advantages over potential rivals. In particular, the company has engaged in cross-market bundling, which involves conditioning rebates (or offering incremental rebates) on products such as Enbrel in exchange for giving Amgen drugs preferred placement on the insurers’ and PBMs’ lists of covered medications in different product markets. The value of the rebates that Amgen can offer on its high-volume drugs as part of its cross-market bundles may make it difficult, if not impossible, for smaller rivals who are developing drugs to compete against Tepezza and Krystexxa to match the level of rebates that Amgen would be able to offer. By substituting Amgen, with its portfolio of blockbuster drugs and significant contracting leverage, for Horizon, the FTC said the deal could give the merged firm the ability and incentive to entrench Tepezza’s and Krystexxa’s monopolies through its multi-product contracting strategies. This could effectively deprive patients, doctors, and health plans from the benefits of competition and access to critical new options for treatment of thyroid eye disease and chronic refractory gout. The Commission vote to authorize staff to seek a temporary restraining order and preliminary injunction was 3-0. Last year the FTC launched an inquiry into the prescription drug middleman industry, requiring the six largest pharmacy benefit managers to provide information and records regarding their business practices. The agency’s inquiry will scrutinize the impact of vertically integrated pharmacy benefit managers on the access and affordability of prescription drugs. As part of this inquiry, the FTC will send compulsory orders to CVS Caremark; Express Scripts, Inc.; OptumRx, Inc.; Humana Inc.; Prime Therapeutics LLC; and MedImpact Healthcare Systems, Inc ...

Cedars-Sinai Medical Center operates a nonprofit academic medical center in Los Angeles. Its total workforce exceeds 15,000 employees, including approximately 2,100 doctors and 2,800 nurses. Together, these employees provide medical care to thousands of patients per day and perform related administrative and operational functions. Deanna Hodges began working for Cedars in 2000. Throughout her tenure, she worked in an administrative role with no patient care responsibilities. Her office was in an administration building Cedars owned about a mile from the main Cedars medical campus, though she occasionally visited the main medical campus in her capacity as an employee. A shuttle bus ran continuously between the main medical campus and the administration building, and many Cedars employees traveled between the two sites on a daily basis. In 2007, Hodges was diagnosed with stage III colorectal cancer. She stopped working for a year and a half to undergo treatment, which included chemotherapy. The treatment was effective to rid her of cancer but left her with lingering side effects. These included unspecified allergies, a weakened immune system, and neuropathy - damage to the nerves resulting in an ongoing "tingling sensation" in her fingers and toes. None of these side effects limited her ability to perform her job functions, and she successfully returned to work for Cedars in 2009. As an administrative employee without direct patient contact, plaintiff was under no obligation to get a flu vaccine when she was hired or when she returned from cancer treatment in 2009. This changed in 2017. That September, Cedars announced a new policy requiring all employees, regardless of their role, to be vaccinated by the beginning of flu season. This was the latest expansion to Cedars’s longstanding efforts to limit employee transmission of flu, which had become more urgent in recent years following multiple patient deaths relating to flu. The expanded 2017 policy aligned with the recommendation of the United States Department of Health and Human Services Centers for Disease Control and Prevention (CDC) "that all U.S. health care workers get vaccinated annually against influenza." Her doctor wrote a note recommending an exemption for various reasons, including her history of cancer and general allergies. None of the reasons was a medically recognized contraindication to getting the flu vaccine. Cedars denied the exemption request. Hodges still refused to get the vaccine. Cedars terminated her. Hodges sued Cedars for disability discrimination. Her complaint contained six causes of action, each alleged as a violation of FEHA or the public policy it manifests. The trial court granted Cedars’s motion for summary judgment. The court of appeal affirmed in the published case of Hodges v. Cedars-Sinai Medical Center - B297864 (May 2023). In her appellate briefing she identifies the elements of her prima facie discrimination claim as being those of a claim for physical disability discrimination. Citing Arteaga v. Brink’s, Inc. (2008) 163 Cal.App.4th 327, 344-345, a physical disability case which recites the elements of her prima facie claim as follows: "that she (1) suffered from a disability, or was regarded as suffering from a disability; (2) could perform the essential duties of the job with or without reasonable accommodations[;] and (3) was subjected to an adverse employment action because of the disability or perceived disability." Plaintiff argues her cancer history and neuropathy amount to a physical disability because they "make it impossible for her to work as she cannot work as she cannot get vaccinated. Her disabilities limited her ability to safely receive the vaccine." To be clear, plaintiff admits her cancer history and neuropathy in no way otherwise limited her ability to work in 2017. In moving for summary judgment, Cedars introduced evidence that plaintiff was not disabled and could not prove she was disabled. It offered official guidance from the CDC and testimony from Dr. Grein that there were only two medically recognized contraindications for getting the flu vaccine. None of the conditions listed on her exemption form were recognized contraindications for getting the flu vaccine. The court of appeal concluded that "Judgment was proper on plaintiff’s disability discrimination cause of action because she failed to produce evidence sufficient to create a fact issue concerning an essential element of her prima facie case, i.e., her claimed disability or the perception by Cedars of disability. We therefore need not address the other elements of plaintiff’s prima facie case." "Even if plaintiff had made a prima facie case for discrimination of any kind (e.g., physical disability, medical condition, or otherwise), summary adjudication of her disability discrimination cause of action would still have been proper because Cedars presented a legitimate, nondiscriminatory reason for her termination, and plaintiff fails to argue the reason was pretextual." ...

Handy Technologies, Inc., a company that offers in-house services through an app, has agreed to pay $6 million and enter into a permanent injunction to settle a worker protection lawsuit. The San Francisco District Attorney’s Office and Los Angeles District Attorney’s Office alleged that the New York-based company Handy.com unlawfully misclassified workers as independent contractors rather than employees in violation of California’s employment classification laws, including State Assembly Bill 5 (2019). Handy, a company started by Harvard Business School classmates Oisin Hanrahan and Umang Dua in 2012, has scheduled home-cleaning and repair gigs for tens of thousands of workers in California, according to the San Francisco DA’s office.Handy refers to the workers who perform the cleaning and handyman services requested by customers as "Pros." As part of the judgment, which was recently filed in San Francisco Superior Court, Handy must pay $4.8 million in restitution to workers, which will cover over 25,000 California Pros who worked during the period of March 2017 to May 2023. Handy must also pay a civil penalty of $1.2 million for its unlawful practices. With respect to Handy’s future treatment of Pros, Handy has agreed to a permanent injunction that will safeguard Pros from ongoing misclassification. In resolving this matter, Handy has made substantial changes to its business operations in order to no longer run afoul of California’s classification laws. These changes include that Pros can now set their own hourly pay rates and, after claiming jobs, Pros are now able to immediately contact customers to learn more about the requested service and negotiate its terms (like hours and pay) without being contractually bound to perform the work or penalized by Handy for rejecting the job. As alleged in the case, for the period of time that Handy illegally misclassified Pros as independent contractors instead of employees, these workers were deprived of workplace benefits to which they were entitled. In the coming months, a claims administrator will ensure that California Pros who are eligible for restitution receive their respective distribution from the restitution funds. Assistant District Attorney Stillman leads the office’s Workers’ Rights Unit and was supported in this case by Assistant District Attorney Angela Fisher and Paralegal Chloe Mosqueda, under the supervision of Assistant Chief District Attorney Matthew McCarthy of the White Collar Crime Division. The Workers’ Rights Unit of the San Francisco District Attorney’s Office investigates and prosecutes legal violations committed by employers against workers. This innovative unit, one of the first of its kind in the nation, focuses on civil enforcement of workplace law through California’s Unfair Competition Law as well as crimes such as wage theft and labor trafficking ...

Elizabeth Castelo was employed by Xceed as its Controller and Vice President of Accounting. In November 2018, Xceed informed Castelo her employment would be terminated effective December 31, 2018. On November 19, 2018, the parties entered into an agreement entitled "Separation and General Release Agreement", in which Xceed agreed to pay Castelo a severance payment in consideration for a full release of all claims, including "a release of age discrimination claims that she has or may have under federal and state law, as applicable." The release extended to all claims known and unknown "arising directly or indirectly from Employee’s employment with [Xceed] [and] the termination of that employment" including (among many other listed claims) "wrongful discharge[;] violation of public policy[;] . . . [and] violation of the California Fair Employment and Housing Act." The parties agreed to waive the protections of Civil Code section 1542. Castelo and Xceed signed the Separation Agreement on November 19, 2018. Attached as Exhibit A to the Separation Agreement was a document entitled "Reaffirmation of Separation and General Release Agreement" which was to be signed on the date of her separation, which was December 31, 2018. It was undisputed Xceed management intended that Castelo would sign the Reaffirmation on the date of her separation. However, Castelo signed it on the same date she signed the main Separation Agreement, on November 19, 2018, and Xceed did nothing to correct that error. She was paid $137,334 for her signing this agreement as of the date of her separation. Nonetheless Castelo sued her former employer Xceed Financial Credit Union (Xceed) for wrongful termination and age discrimination in violation of the Fair Employment and Housing Act (FEHA) On October 3, 2019, the parties stipulated the action would be submitted to binding arbitration pursuant to an arbitration agreement executed in 2013. The court then dismissed the action without prejudice but retained jurisdiction to enter judgment on any arbitration award. The matter was submitted to binding arbitration before Hon. Enrique Romero (ret.). Xceed filed a response to Castelo’s complaint alleging, among other things, Castelo’s action was barred by the release. Xceed also filed a cross-complaint and first amended cross-complaint, asserting claims for (1) breach of the Separation Agreement and Reaffirmation; (2) unjust enrichment; (3) reformation; (4) declaratory relief; and (5) promissory estoppel. The arbitrator rejected Castelo’s assertion that since the release was signed on November 18, and that she was not wrongfully terminated until December 31, the release violated Civil Code section 1668, which prohibits pre-dispute releases of liability in some circumstances. The arbitrator granted summary judgment in favor of Xceed on the ground Castelo’s claims were barred by a release in her separation agreement. Castelo moved to vacate the arbitration award, arguing the arbitrator exceeded his powers by enforcing an illegal release. The trial court denied the motion to vacate and entered judgment confirming the arbitration award. The Court of Appeal affirmed in the published case of Castelo v. Xceed Financial Credit Union - B311573 (May 2023). The parties disagreed as to the proper scope of the court of appeal's review. "Where, as here, an arbitrator has issued an award, the decision is ordinarily final and thus ‘is not ordinarily reviewable for error by either the trial or appellate courts.’ [Citation.] The exceptions to this rule of finality are specified by statute. As relevant here, the [California Arbitration Act (CAA)] provides that a court may vacate an arbitration award when "[t]he arbitrators exceeded their powers and the award cannot be corrected without affecting the merits of the decision upon the controversy submitted." Castelo contends on appeal that the release, as interpreted and applied by the arbitrator, violates Civil Code section 1668 because it purported to release claims that accrued after Castelo signed the document. Castelo claims that the arbitrator exceeded his authority in giving effect to the illegal release and that this court must review the arbitrator’s and trial court’s decisions de novo. The court of appeal noted that "Castelo does not claim the entire Separation Agreement and Reaffirmation is illegal. She does not seek to rescind the agreement and does not propose she return the $137,334.00 she received as consideration. Rather, she seeks to invalidate only the release, and only to the extent the arbitrator applied the release to claims that accrued on or after the date of its execution. Castelo’s argument that the arbitrator’s decision is subject to judicial review simply because the release is alleged to be illegal thus fails." The arbitrator explained the basis for this conclusion at length. Among other things, the arbitrator reasoned: "[T]he objectively-manifested intent of the Agreement was for Castelo to release all claims as of the date of signature (defined as the ‘Effective Date’ in the Agreement) in exchange for the payment of $5,000.00, and then extend that release through the Separation Date, December 31, 2018, for an additional $132,334.00." When the arbitrator then turned to whether the release, as interpreted, violated Civil Code section 1668 because Castelo executed the release before the claim for wrongful termination had fully accrued. "[¶] Even assuming arguendo that Castelo’s claim for wrongful termination did not accrue until her termination on December 31 and that the release affects the ‘public interest,’ this argument gains no traction." "The Agreement did not have, as its purpose, the immunization of Xceed from liability for a future violation of law. Rather, it clearly intended to, on December 31, 2018, effect the release of claims which had accrued on or before that date (i.e., an accrued claim for wrongful termination, and any other employment-related claim Castelo could bring). The Arbitrator declines to permit Castelo - who accepted the benefits under the Reaffirmation - to use her mistakenly-premature execution of the Reaffirmation to leverage this statute as a weapon against Xceed." Here the court of appeal noted "Castelo has not cited a single case in which section 1668 was invoked to invalidate a release of a claim that was known to the releasor at the time the release was executed and after a dispute had already arisen between the parties, and our review has revealed none." The court of appeal concluded "the arbitrator did not commit clear legal error in enforcing the release and the trial court did not err in denying the motion to vacate. The arbitrator’s enforcement of the release did not violate section 1668 because Castelo signed the release after the allegedly discriminatory decision was made and after Castelo had already concluded that she was being wrongfully terminated because of age discrimination." ...

The mission of the Office of the New York State Workers' Compensation Fraud Inspector General (WCFIG) is to conduct and supervise investigations of possible fraud and other violations of the laws, rules, and regulations pertaining to New York State's workers' compensation system. WCFIG's investigations are complex and often involve detailed record analysis and interviews of employers, employees, health care providers, and insurance carriers. These investigations can result in criminal referrals, arrests, and prosecutions, as well as recoveries of restitution. Lucy Lang was appointed in 2021 to serve as the New York State Workers' Compensation Fraud Inspector General. New York State Workers' Compensation Law§ 136 mandates that the WCFIG submit a report to the Governor and the Chair of the Workers' Compensation Board that summarizes the activities of the office for each calendar year. In 2022, Inspector General Lang received 1,462 complaints. This represents an increase of more than 30 percent compared to 2021. The investigations conducted by WCFIG in 2022 led to 16 arrests, more than double the number of 2021 arrests. In 2022, nearly 2.7 million dollars in workers' compensation fraud was uncovered. Additionally, WCFIG investigations that culminated in prosecutions reclaimed nearly five million dollars through fines and court orders for defrauded New York State agencies, insurance carriers, and employers. WCFIG investigations usually begin with either the lodging of a complaint alleging workers' compensation fraud or the identification of potential fraud by the Inspector General in the course of WCFIG's pro-active initiatives. Cases opened by WCFIG for full investigation are assigned to multi-disciplinary teams led by an investigative counsel who is assisted by investigators, investigative auditors, medical professionals, and computer forensic specialists. The investigations are supervised by a regional Deputy Inspector General and the Attorney-in-Charge of workers' compensation fraud. Acting under WCFIG's statutory authority, the investigative teams may subpoena witnesses, take sworn testimony, and compel the production of relevant records. In 2022, WCFIG's investigations led to criminal charges against 16 people. Ten of these matters involved employer fraud, while the remaining six were examples of claimant fraud. Of these 16 arrests in 2022, nine resulted in convictions and seven matters are still pending prosecutions. In addition, several criminal prosecutions initiated in prior years concluded in 2022, resulting in criminal convictions of six people. In 2022, WCFIG also continued its investigations of medical providers and other professionals whose job responsibilities are integral to the proper administration of the workers' compensation system. These professionals may include treating and independent physicians, physician assistants, nurses, home health aides, law judges, attorneys, court reporters, and insurance professionals. Provider cases are often complex and involve longterm investigations. As a result of WCFIG's investigations in 2022, several matters were referred to both licensing agencies and the Health Provider Discipline Unit of the Workers' Compensation Board resulting in the loss of certifications. Several other investigations involving medical providers and other professionals are ongoing. One such notable case concerned a medical provider who orchestrated a scheme to defraud the State of New York and insurers by falsifying medical prognoses and records of patients, many of them New York State Corrections officers, to keep them out of work for extended periods of time on false or exaggerated workers' compensation claims. The physician also billed for services that were either never provided or provided by unlicensed or untrained staff while the physician was out of the state ...

Jason Labella claimed to have suffered injury in the form of COVID-19-related illness, as well as injury to the digestive, circulatory and nervous systems, while employed on December 6, 2021 as a pipe fitter by Marathon Petroleum. The defendant filed petitions to compel the attendance at deposition of fact witnesses Briauna Hollingsworth, Marshall Mataalii, and Jenna Vasquez. They said that Labella and the fact witnesses lived at the same address, and that the depositions were necessary "to obtain details of Mr. LaBella’s possible exposure to COVID at home." The WCJ issued an order denying all three petitions to compel, stating, "this court is unaware of any basis or jurisdiction for compelling a non-party to appear for a deposition." The defendant's Petition for Removal of the case was granted, and the WCAB rescinded the WCJ’s decision, and return this matter to the WCJ for further proceedings and decision in the case of Labella v Marathon Petroleum - ADJ15703855 (April 2023). In his Petition, the defendant argued that pursuant to Labor Code section 5710, any party to a workers’ compensation proceeding may cause the deposition of witness. Defendant cites to the WCAB panel decision in Terrones v. Remedy Temp (August 30, 2010, ADJ423557) [2010 Cal. Wrk. Comp. P.D. LEXIS 451] as authority for the proposition that the WCJ is empowered to compel to the deposition of a non-party witness. Defendant also claims a due process right to conduct discovery relevant to applicant’s claim of industrial injury, and that the WCJ’s order declining to compel the requested depositions results in a denial of that due process right. The WCJ’s Report initially describes various procedural irregularities in the subpoenas issued by the defendant. The report then responds to defendant’s citation to the panel decision in Terrones v. Remedy Temp, supra, 2010 Cal. Wrk. Comp. P.D. LEXIS 451, observing that as a panel decision, the case is not mandatory authority. The Report notes that Terrones involved nonparty employees of the defendant, as distinguished from the present matter in which the nonparty deponents are not employees of defendant, and are essentially strangers to the case. The WCJ observes that defendant has not established "good cause" for the deposition of the witnesses beyond their proximity in the same household as applicant, and that defendant may issue a subpoena for the witnesses to testify at trial. The report concludes that "if defendant can show good service and ‘good cause 'for taking the nonparties' deposition.....this WCJ would consider whether or not an Order Compelling is appropriate." In response the WCAB panel noted that an adequate and complete record is necessary to understand the basis for the WCJ’s decision and the WCJ shall "...make and file findings upon all facts involved in the controversy[.]" (Lab. Code, § 5313; Hamilton v. Lockheed Corporation (2001) 66 Cal.Comp.Cases 473, 476 [2001 Cal.Wrk.Comp. LEXIS 4947] (Appeals Bd. en banc). "Here, the WCJ’s Order does not substantively address any issue beyond stating that there is no basis or jurisdiction to compel a non-party’s appearance at deposition. The record does not frame the issues, contains no exhibits, testimony or summary of evidence, and does not adequately explicate the basis for the order, To the extent that the WCJ’s report describes multiple other considerations, including whether the underlying subpoenas were procedurally defective, whether appropriate notice to the deponents was effectuated, whether the defendant’s petitions establish good cause for an order compelling, and whether a protective order or other limitations on the scope of the depositions is appropriate, the record is silent on these issues." "Accordingly, and pursuant to Hamilton v. Lockheed Corporation, supra, 66 Cal.Comp.Cases 473, we will rescind the October 25, 2022 Order, and return this matter to the trial level for further proceedings and for the creation of an adequate record." The WCAB pointed out several applicable code sections that provide guidelines for the taking of depositions, and that labor code section 5710 provides that attendance of witnesses and the production of records may be required." "Thus, while the Appeals Board may cause the taking of a deposition of a witness who happens to be an employee of a party, as was the case in Terrones v. Remedy Temp, supra, 2010 Cal. Wrk. Comp. P.D. LEXIS 451, the jurisdiction of the Appeals Board in such nonparty cases is not limited to the employees of parties." ...

Governor Newsom just signed Assembly Bill 112 - The California Health Facilities Financing Authority Act - into law. This is an emergency bill providing up to $150 million in zero-interest loans to nonprofit and public hospitals in danger of closing in the aftermath of the pandemic. Assembly Bill 112 passed the California Assembly with a vote of 77-0 and the California Senate with a vote of 38-0. This law takes effect immediately now that it has been passed and signed. "This new program will help hospitals in extreme financial distress get the assistance they need as quickly as possible," said Newsom after signing on Monday. "My administration has been working closely with hospitals across the state, and we will continue to do all we can to ensure communities can continue to access the care and services they need without disruption." According to the Times of San Diego report, legislators fast-tracked action following the closure of Madera Community Hospital at the start of this year, which left this San Joaquin Valley county of 160,000 people without a local emergency room. Other hospitals in financial trouble include Kaweah Health Medical Center in Visalia, El Centro Regional Medical Center in Imperial County, MLK Jr. Community Hospital in Los Angeles, Hazel Hawkins Memorial Hospital in Hollister, Sierra View Medical Center in Porterville and Mad River Community Hospital in Humboldt County. Some of the hospitals were struggling prior to the pandemic, and have had a difficult time managing cash flow after they stopped receiving federal COVID relief funds. This new law creates the Distressed Hospital Loan Program, until January 1, 2032. The purpose is to provide loans to not-for-profit hospitals and public hospitals that are in in significant financial distress or to governmental entities representing a closed hospital to prevent the closure or facilitate the reopening of a closed hospital. The law requires the Department of Health Care Access and Information to administer the program and requires the department to enter into an interagency agreement with the authority to implement the program. The law requires the department, in collaboration with the State Department of Health Care Services, the Department of Managed Health Care, and the State Department of Public Health, to develop a methodology to evaluate an at-risk hospital’s potential eligibility for state assistance from the program. This law also creates the Distressed Hospital Loan Program Fund, a continuously appropriated fund, for use by the department and the authority to administer the loan program. It would authorize both the authority and the department to recover administrative costs from the fund. Republican Sen. Brian Jones of east San Diego County had urged Newsom to sign the legislation, saying, "The clock is ticking for distressed hospitals that are holding on by a financial shoestring." ...

In facilities such as large hotels and large restaurants where the employer is in the business of providing a banquet facility at which food and beverages are served, the employer often adds a mandatory, and substantial "service charge" to the contract for every banquet. Prior to 2019 California, courts long held that these mandatory charges cannot be considered gratuities under the labor code and thus not distributable to those who serve food and beverages at the banquet. That view changed after the 2019 appellate case O'Grady vs. Merchant Exchange Productions Inc., 41 Cal.App.5th 771 (2019) 254 Cal.Rptr.3d 494. Plaintiff, Lauren O’Grady, was a banquet server and bartender at the Julia Morgan Ballroom in San Francisco, which is operated by Merchant Exchange Productions. Plaintiff brought this class action alleging that her and the other non-managerial service employees were entitled to the 21 percent "service charge" added to every banquet bill. Plaintiff alleged that the service charge constituted a gratuity that should be distributed to the non-managerial service employees pursuant to labor code section 351. The employer took the position that two Court of Appeal opinions hold, as a matter of law that a service charge can never be a gratuity. The trial court agreed, and sustained the employer's general demurrer without leave to amend. The issue presented on appeal was whether the "service charge" may be a "gratuity" that Labor Code section 351 requires to go only to the non managerial employees involved with the actual serving of the food and beverages. The court of appeal reversed the trial court dismissal and concluded there is no categorical prohibition why what is called a service charge cannot also meet the statutory definition of a gratuity. Tipping and service fees have been becoming a flashpoint in the restaurant and hospitality industries. Healthcare-related service fees began gradually popping up on diners' bills in the last decade but became ubiquitous after the COVID-19 shutdowns. The tacked-on fees came amid a wave of empathy and gratitude for service workers at a moment when the future of restaurants seemed in doubt. Now, according to a report by the San Francisco Chronicle the O'Grady ruling was tested as recently as April 19, 2023 when a San Francisco judge ruled in a nonjury trial that a Marriott hotel in downtown San Francisco must pay around $9 million in withheld service fees to staff who served food and drinks at banquets, and said he would decide later whether to add interest charges and attorneys’fees. . The workers’ lawyer, Shannon Liss-Riordan, said this was the first case to go to trial since the O'Grady decision where she was also the plaintiff's attorney. "Customers pay service charges - on top of hefty food and beverage bills - because they think they are tips for the waitresses." Liss-Riordan said she has won similar cases in Massachusetts and Hawaii and has suits pending against other hotels in San Francisco and elsewhere in California.. Harvard Law School graduate Shannon Liss-Riordan of Lichten & Liss-Riordan has had a long career litigating discrimination, wage and hour, and traditional labor law matters, and has gone after some of the nation's most prominent companies, including Whole Foods, Starbucks, Uber and Lyft, on behalf of workers. And now according to a new story published this month in the Los Angeles Times, the Los Angeles city attorney is examining whether Ten Five Hospitality violated an ordinance for allegedly keeping the entirety of the 5% service fee they charged to customers instead of distributing it to workers, A 5% service fee attached to customer restaurant bills is at the heart of this investigation launched by the Los Angeles city attorney’s office, and it involves some of the city’s most celebrated restaurants at the adjacent Thompson hotel, Tommie hotel and Citizen News building: Mother Wolf, Ka'teen, Mes Amis, Bar Lis and the Terrace. The definition of "hotel" in the L.A. ordinance covers restaurants that are contracted or leased premises that are connected to or operated in hotels, such as the Terrace or Mother Wolf. L.A.'s ordinance states that service fees cannot be retained by a hotel employer but must be paid in their entirety to the hotel worker performing services for the customers from whom the service charges are collected. The ordinance also mandates that no part of these amounts may be paid to supervisory or managerial employees, and that the service fee must be paid to the hotel workers equitably. According to an April 6 letter from Deputy City Atty. Joshua L. Crowell, City officials asked Ten Five Hospitality - the group that operated the five restaurants - and the five restaurants, for a response and numerous documents, including any evidence that would demonstrate workers benefited from the fee. The city attorney's office is also investigating allegations that at least two workers at the Terrace were fired after speaking out about the service fee. No Ten Five Hospitality executives were made available for comment. But a spokesperson provided a prepared statement, which read: "The Wellness Fee, which is explained clearly on all customer bills, enables the company to provide an above-market employee package including a robust medical, dental & vision insurance program, 401(k) benefit offering and better working conditions for all employees." The spokesperson declined to answer any other questions about the allegations in the city's letter ...

As state lawmakers debate legislation that revisits the California workers’ compensation medical dispute resolution process, a new California Workers’ Compensation Institute (CWCI) Report to the Industry finds that the number of independent medical reviews (IMRs) used to resolve medical disputes hit a record low in 2022, as prescription drug disputes continue to decline, and that a small subset of doctors continue to generate most of the disputed treatment requests that go through IMR. California law requires every workers’ compensation claims administrator to have a Utilization Review (UR) program to assure that care provided to injured workers meets the evidence-based guidelines in the state’s Medical Treatment Utilization Schedule (MTUS). Most treatment requests are approved by UR, but in 2012 state lawmakers adopted IMR to allow injured workers to get an independent medical opinion on requests that UR physicians modify or deny. IMR took effect for all claims in July 2013, and CWCI began tracking IMR activity in 2014. In its new analysis, CWCI found that 127,215 IMR decision letters were issued in 2022 in response to applications submitted to the state, down 4.7% from 133,494 letters in 2021, and down 31.1% from the record 184,735 letters in 2018. The latest data on outcomes show that after reviewing medical records and other information provided to support a disputed treatment request, IMR doctors upheld the UR physician’s modification or denial of the service in 91.1% of the 2022 IMRs, down slightly from the record 92.0% uphold rate in 2021. Uphold rates among service categories ranged from 82.5% for psych services to 95.9% for injections. The high uphold rates demonstrate a high degree of agreement in assessing the quality of care and in challenging inappropriate or excessive treatment requests. Disputes over prescription drug requests represented a third of the 2022 determinations, well ahead of physical therapy (13.3%) and injections (11.9%), though that percentage is down from nearly half of all IMR disputes prior to the state’s adoption of Opioid and Chronic Pain Treatment Guidelines at the end of 2017 and the implementation of the MTUS Prescription Drug Formulary in January 2018. A closer look at the prescription drug disputes shows that even with those guidelines and the formulary, opioids still accounted for nearly a quarter of the 2022 pharmaceutical IMRs, more than any other type of drug, though that percentage is down from 32.1% in 2018. Not all UR challenges submitted for IMR involve treatment denials. Since 2016, 1 out of 7 IMRs have involved modifications of treatment requests, most often because the volume of services requested exceeded the MTUS-recommended level. For example, IMRs are often submitted after a UR physician approves the treatment on a modified basis, allowing fewer pills in a prescription or fewer physical therapy (PT) visits than were requested in order to meet the evidence-based guideline. This can lead to a dispute, even though additional pills or PT visits can be requested later if the treatment proves successful. Since 2017, 57.1% of all modification disputes resolved by IMR have involved prescription drugs, and 17.1% have involved PT, though with the adoption of the Pain Management and Opioid Guidelines and the implementation of the MTUS Formulary, disputes over prescription drug requests declined from 62.9% of the modification disputes in 2017 to 40.6% in 2022, while disputes over PT modifications increased from 15.0% to 21.9%. Overall, since 2017, UR physician modifications have been upheld 91.5% of the time they have gone reviewed by IMR, with uphold rates ranging from 90.8% of the pharmaceutical modifications to 94.9% of the modifications to acupuncture requests. CWCI has issued its analysis as a free Report to the Industry, "Resolving Medical Disputes: Factors that Drive IMR Volume and Outcomes in the California Workers’ Compensation System." ...

Tyra Montgomery is employed by Los Angeles Unified School District as a special education assistant in an elementary school classroom. She injured her neck, back, and shoulders at work in 2017 while intervening in an incident involving a student exhibiting aggressive behavior. She filed a workers’ compensation claim and went on medical leave from December 2017 to August 2019. Her doctor then returned her to work with restrictions of (1) no lifting objects over 40 pounds; (2) no standing or walking for longer than one hour without at least ten minutes of sitting; and (3) no repetitive squatting, crouching, crawling, or kneeling. In September 2019, the school principal received complaints from the drivers of the school bus transporting students with special needs. They informed her that the students were engaging in disruptive and dangerous behavior on the bus, including getting out of their harnesses, crawling around on the floor of the bus, and fighting with one another. School administrators decided to have an additional person to ride along on the bus, and assigned the role to Ericka Johnson, a special education assistant who supports one of the bus’s students in the classroom. A few days after Johnson began riding on the bus, Montgomery expressed interest in working the assignment on a bi-weekly rotation with Johnson. LAUSD asked her to provide a clearance from her doctor that is specific to the activities she would be doing on the bus." Montgomery ultimately did not provide the school administrators with the information requested. In subsequent conversations with her about her request for this position, she was advised that she would be required to fully lift the students and put them back in their seats if they got up while the bus was in motion. And if she got her forty-pound lifting restriction removed, then she would put on the bus as she requested. Montgomery sued LAUSD under FEHA, and alleged claims for disability discrimination (first cause of action), failure to accommodate (second cause of action), and failure to engage in the interactive process (third cause of action). LAUSD moved for summary judgment which was granted by the trial judge. The Court of Appeal affirmed the trial court in the unpublished case of Montgomery v LAUSD -B316697 (May 2023). Montgomery contended the trial court erred by concluding her disability discrimination claim fails as a matter of law because "there were disputable issues of fact . . . as to whether [she] could perform the essential functions of the [desired] position." The evidence provided by LAUSD established that an essential function of a special education assistant working as a bus aide is to lift students as required to meet their various needs. Each of the students on the bus weighed more than forty pounds. Montgomery, however, cannot lift more than forty pounds, and therefore cannot perform the lifting function necessary to meet student needs. Thus LAUSD has carried its burden of showing Montgomery cannot satisfy the second element of a prima face case for disability discrimination. The burden therefore shifted to Montgomery to show a triable issue of material fact exists. (Code Civ. Proc., § 437c subd. (p)(2).) Montgomery has not shown there are any triable issues of fact, thus, the trial court correctly determined her first cause of action fails as a matter of law, as LAUSD produced uncontroverted evidence showing she cannot satisfy the second element of a prima facie case for disability discrimination. The showing required to satisfy the second element of a reasonable accommodation claim is "identical to that required" for the second element of a prima facie case for disability discrimination. Accordingly, as a matter of law, Montgomery’s second cause of action fails for the same reason her first cause of action fails. To prevail on her third cause of action, the employee must identify a reasonable accommodation that would have been available at the time the interactive process occurred [or should have occurred]. For purposes of the bus aide assignment, school district employees established that no reasonable accommodation was available for a special education assistant who cannot lift the students on the bus. Based on this evidence, LAUSD has satisfied its burden of showing Montgomery cannot establish an essential element of her interactive process claim. The burden therefore shifted to Montgomery. In her appellate briefs, however, Montgomery has not cited any evidence in the record showing the existence of a reasonable accommodation that would have allowed her to perform the essential functions of the bus aide assignment with her work restrictions ...

The California Insurance Commissioner announced the resolution of criminal charges filed against Golden Food, Inc (GFI). a chicken processing business located in South El Monte. It entered into a plea agreement after an investigation by the California Department of Insurance (CDI) and the California Labor Commissioner’s Office (LCO). CDI received a referral from SCIF, who suspected the business of fraud after comparing the payroll reported during annual audits with the payroll reported to the Employment Development Department. CDI obtained a search warrant for GFI's building and was able to obtain true payroll records from the employer's computer, as well as fake tax reporting forms that it used to perpetrate its fraud. The investigation led to 43 felony counts of insurance fraud, grand theft, and conspiracy against Lam and Wu. The business, owned by Feng Wen Lam and operated by her husband Wei Wu, was accused of underreporting its payroll to its workers’ compensation insurance carriers by $4,489,390.55 between 2015 and 2021. This resulted in a loss of $1,681,138.80 in unpaid insurance premiums to four insurance companies, including the State Compensation Insurance Fund (SCIF). The LCO’s parallel investigation uncovered significant wage theft over many years. The company admitted to a litany of labor violations, which includes over $437,000 in stolen wages to be paid back to more than 30 California workers. Employees were forced to clock out for breaks and continue to work, were not paid overtime pay for work in excess of 40 weekly hours, and their pay stubs were falsified. Wu routinely deducted work hours from employees and falsely counted that pay as a bonus. An audit by LCO found that Lam and Wu failed to pay at least $437,542.56 in labor to their 34 employees based on the minimum legal market value ...

A Temecula, California, man has been found guilty of federal violations related to a health care kickback scheme. Steven Donofrio, 49, was found guilty by a jury on May 5, 2023, following a two-week trial before U.S. District Judge Robert W. Schroeder, III. According to information presented in court, Donofrio conspired with others to pay and receive kickbacks in exchange for the referral of, and arranging for, health care business, specifically pharmacogenetic (PGx) tests. Pharmacogenetic testing, also known as pharmacogenomic testing, is a type of genetic testing that identifies genetic variations that affect how an individual patient metabolizes certain drugs. The illegal arrangement concerned the referral of PGx tests to clinical laboratories in Fountain Valley, California; Irvine, California; and San Diego, California. More than $28 million in illegal kickback payments were exchanged by those involved in the conspiracy. In December 2019, twelve individuals from three states were charged for their roles in the kickback conspiracy. A federal grand jury in the Eastern District of Texas returned an indictment against Philip Lamb, 48, of Eagle, Colorado; Nicolas Arroyo, 41, of Tempe, Arizona; Vincent Marchetti, Jr., 58, of Coronado, California; William Flowers, 58, of Houston, Texas; Steven Donofrio; James J. Walker, Jr. a/k/a Jimmy Walker, 49, of Frisco, Texas; Timothy Armstrong, deceased, formerly of Frisco, Texas; Virginia Blake Herrin, 57, of Frisco, Texas; Patrick Ridgeway, 53, of Jackson, Mississippi; Chismere Mallard, 42, of McAllen, Texas; Dr. Ray W. Ng, 65, of Dallas, Texas; and Ashley Kretzschmar, 37, of Aledo, Texas; for conspiring to commit illegal remunerations in violation of the Anti-Kickback Statute. Philip Lamb, Nicolas Arroyo, Jimmy Walker, Timothy Armstrong, Virginia Blake Herrin, Patrick Ridgeway, Chismere Mallard, and Ashley Kretzschmar pleaded guilty prior to trial. Kimberly Willette, 61, of Friendswood, Texas, and Edwin Chad Isbell, 50, of Atascocita, Texas also pleaded guilty to related charges. Vincent Marchetti, Jr., was found guilty by a jury on December 16, 2021, following a month-long trial. He was sentenced to 48 months in federal prison on August 30, 2022. On April 25, 2022, Nicolas Arroyo was sentenced to 21 months in federal prison. On August 23, 2022, Kimberly Willette was sentenced to one year and one day in federal prison, and Patrick Ridgeway was sentenced to a three-year term of probation and ordered to pay a $100,000 fine. The Anti-Kickback Statute prohibits offering, paying, soliciting, or receiving remunerations in exchange for the referral of or arranging for or recommending the ordering of items or services payable under federal health care programs. Under federal statutes, violations of the Anti-Kickback statute are punishable by up to five years in federal prison. This case was investigated by the U.S. Department of Health and Human Services, Office of Inspector General, and the FBI Dallas - Frisco Resident Agency. It was prosecuted by Assistant U.S. Attorneys Nathaniel C. Kummerfeld, Lucas Machicek, and Adrian Garcia, with assistance from Assistant U.S. Attorneys Stephan E. Oestreicher, Jr., Brent Andrus, and L. Frank Coan, Jr., and Special Assistant U.S. Attorney Laurel E.P. Simmons. "This is the last of many defendants in this case who abused our healthcare system for the sake of stealing taxpayer dollars and in the process caused unnecessary medical procedures," said U.S. Attorney Damien M. Diggs. "Protecting citizens from physical and financial harm is always a top priority for law enforcement and parasites like Donofrio, who prey on vulnerable citizens, will be brought to justice." "The reach of HHS/OIG is far and wide. Our agents and law enforcement partners will not be deterred by the scope of a healthcare fraud investigation or the location of its defendants," said Jason E. Meadows, Special Agent in Charge of the U.S. Department of Health and Human Services, Office of Inspector General, Dallas Region. "Donofrio and others stole millions from American taxpayers for medically unnecessary services and all to line the pockets of greedy individuals across the country. HHS/OIG and our partners remain laser-focused in our pursuit of those who use the Medicare trust fund as their own personal piggy bank." "Illegal kickback schemes corrupt the healthcare system by causing billions of dollars in losses each year. They also directly affect patients who expect to receive quality care and to be billed for legitimate services from their health care providers," said FBI Dallas Special Agent in Charge Chad Yarbrough. "We will continue to work tirelessly with our law enforcement partners to hold those who commit healthcare fraud accountable and seek justice for the patients that are harmed as a result of these schemes." ...

The Workers’ Compensation Insurance Rating Bureau of California has released its Quarterly Experience Report. This report is an update on California statewide insurer experience valued as of December 31, 2022. The WCIRB proposed a modest overall increase of 0.3% in advisory pure premium rates in its September 1, 2023 Pure Premium Rate Filing. Highlights of the report include: - - California written premium in 2022 is 14 percent above that for 2021, driven by higher employee wage levels and the economic recovery. - - The average charged rate for 2022 is 7 percent below that for 2021 and the lowest in decades. - - After four consecutive increases,the projected loss ratio, including the cost of COVID-19 claims, dropped 4 points in accident year 2022. - - The projected combined ratio for 2022, including COVID-19 claims, is 5 points lower than in 2021. - - The lower combined ratio in 2022 is driven by a significant increase in premium due to higher payrolls and very modest changes in claim frequency and severity. - - Average claim closing rates are beginning to increase in 2022 but remain below the pre-pandemic high. - - Claim frequency for 2022 is comparable to 2021 and consistent with the pre-pandemic trend. - - The 2022 average severity is the highest in more than a decade since prior to the SB 863 reforms. - - The projected medical severity for 2022 is 1% lower than 2021 and 9% higher than 2017. - - Average medical service costs paid per claim in 2022 is consistent with 2021, as higher payments per transaction were offset by fewer transactions per claim. The full report is in the Research section of the WCIRB website ...

The Division of Workers’ Compensation has issued a notice of public comment period beginning on May 12, 2023, for modifying the text of proposed amendments to the Qualified Medical Evaluator (QME) Regulations. The affected regulations are Title 8, California Code of Regulations Sections 1, 11, 11.5, 14, 33, 35, 35.5, 50, 51, 52, 54, 55, 56, 57, 63, 10133.54 & 10133.55. (QME Process Regulations). The proposed changes are necessary to bring existing regulations into compliance with amendments to the Labor Code and to clarify the Administrative Director’s authority with respect to the process related to appointment and reappointment of QMEs, which is granted by relevant statutory authority. On March 13, 2023, DWC held a public hearing and received public comments on the amendments to the QME Process Regulations.Based on the comments received, DWC proposes to update the text of the proposed amendments of the regulation to: - - ;Provide a definition of "current" for California Workers Compensation Evaluation certificates. - - Change the position of certain subdivisions within proposed regulation section 11.5 and make clear that virtual learning environments can be used for in-person instruction. - - Clarify the number of hours required as in-person or on-site learning for chiropractic certification. - - Conform days for scheduling initial QME appointments cited in regulation section 33 to amendments in regulation section 31.3(e). - - Delete all references to the defunct designation of "Agreed Panel QME". - - Establish additional grounds for discipline pursuant to Labor Code section 139.21. - - Correct typographical errors. § 51. Reappointment and Denial of Reappointment which appears on page 27 of the Proposed Regulations contain significant provisions for the denial of reappointment. One example is "(2) Failure to comply with the evaluation time frames in sections 34 or 38 on at least three occasions during the calendar year." Or "(6) Three or more instances during the most recent period of appointment of billing or charging for medical-legal evaluations, reports or testimony in violation of the Medical-Legal Fee Schedule as set forth in sections 9793-9795 of Article 5.6 in this title." Or "(12) Participating in three or more instances of activity during the most recent period of appointment that constitute a failure to communicate with the injured worker in a respectful, courteous and professional manner," to cite a few interesting examples that litigants and parties might be interested in using. DWC will consider all public comments. The 15-day notice of modification to the text of the proposed regulations and the text of the regulations can be found on DWC’s rulemaking page. Written comments should be addressed to: Maureen Gray, regulations coordinator Department of Industrial Relations Division of Workers' Compensation 1515 Clay Street, 18th floor Oakland, CA 94612 The Division’s contact person must receive all written comments concerning the proposed modification to the regulations no later than May 30, 2023. Written comments may be submitted by facsimile transmission (FAX), addressed to the contact person at (510) 286-0687. Written comments may also be sent electronically (via e-mail), using the following e-mail address: dwcrules@dir.ca.gov ...