72 year old Carmen Hall Soruco, and her husband 77 year old Antonio Soruco, who both live in Novato, were sentenced last year after pleading guilty to workers’ compensation fraud charges. Hall was sentenced on multiple felony counts to two years of probation with full search and seizure, 120 days in jail, and ordered to pay over $925,000 in restitution to State Compensation Insurance Fund (SCIF) and Employment Development Department (EDD). Antonio Soruco was sentenced to one year of probation with full search and seizure, 120 days in jail, and was also ordered to pay over $925,000 in restitution to SCIF and EDD after pleading guilty to multiple misdemeanor charges. The Department of Insurance investigation revealed Hall and Soruco committed Workers’ Compensation insurance premium fraud by failing to report employees and payroll to SCIF from October 15, 2013 through December 8, 2016, leading to a premium loss of approximately $585,666. Investigators also discovered Hall and Soruco committed payroll tax evasion by failing to report employees and payroll to California’s EDD from October 15, 2013 through February 6, 2019 which resulted in a payroll tax loss to EDD of approximately $342,405. As of September 5, 2023, Hall Soruco and her husband, Antonio Soruco, had paid $7,100, Pratt said. Antonio Soruco had been charged and pled guilty to a misdemeanor but is liable with his wife for the restitution. The law allows a convicted felon to come to court and ask that their charges be reduced to misdemeanors. The court has the discretion to grant or deny the request based upon the underlying facts of the case. Soruco Hall reappeared in court on October 12, 2023, and contended that she had been compliant with the terms of her probation, justifying the reductions. This October 2023, a Marin County Superior Court judge has denied Halls Soruco's request to have her 2022 fraud-related convictions reduced from felonies to misdemeanors. The ruling was aligned with recommendations from Marin County District Attorney’s Office prosecutors.. In this instance, Judge Beth S. Jordan agreed with prosecutors and ruled that Hall Soruco's behavior did not amount to misdemeanor conduct ...

Founded in 1903, the Teamsters Union represents 1.2 million workers in the U.S., Canada, and Puerto Rico. Following a legislative session where he vetoed a multitude of bills that would have improved worker's rights, occupational safety, and financial security for the middle class, the Teamsters are condemning California Gov. Gavin Newsom saying he is making life harder for working families in the nation's most populous state. "The way Gavin Newsom reacted to a vast majority of the pro-labor bills that came before him this year is something that we would expect to see from a governor who got elected with support from the Koch brothers - not someone who received support from organized labor," said Jason Rabinowitz, President of Teamsters Joint Council 7. "Being a pro-union governor doesn't mean you stand with us when it's convenient. It means you stand with organized labor when it counts, which is when it's time to sign pro-union legislation." The worst veto for good-paying careers in transportation was AB 316 - legislation that would have required a human operator in any vehicle over 10,000 pounds. In addition to being a priority for the Teamsters, the bill was incredibly popular. Over 90 percent of the state legislature voted in favor of it, and public polling shows that nearly three-fourths of Californians across party lines, gender, geography, and all other demographics support AB 316 - unsurprising data given that collisions and accidents with self-driving vehicles continue to occur. In addition to AB 316, other pro-worker legislation that Newsom vetoed includes: - - AB 504 - would have banned employers from disciplining or taking any other adverse action against public employees for honoring picket lines or other strike activities; - - SB 686 - would have required that all household domestic service employers comply with and adhere to all applicable occupational safety and health regulations by January 1, 2025, and remove the exemption of domestic workers from safety and health laws; - - SB 799 - would have enabled union members who were either on strike or locked out by their employer to collect unemployment insurance benefits (New York and New Jersey both allow this); - - SB 725 - would have required a successor grocery employer to provide an eligible grocery worker a dislocated allowance equal to one week of pay for each year of employment; - - SB 627 - would have required an employer, following the shutdown of a chain or franchise location, to provide laid off workers the opportunity to transfer to another site within 25 miles of the closed business; - - AB 575 - would have expanded eligibility for Paid Family Leave (PFL) benefits to include workers who take time off from work to bond with a child that they are acting as the legally-recognized primary caregiver for. AB 575 would have also removed a restriction that allowed only one family member at a time to access PFL, as well as a provision that allowed employers to make workers use up to two weeks of vacation time prior to accessing PFL; - - AB 1123 - would have required the California State University (CSU) system to grant workers a leave of absence with pay for one semester of an academic year, or an equivalent duration in a one-year period, following the birth of a child or in connection with the adoption or foster care placement of a child by the CSU worker; - - SB 751 - would have prohibited franchise agreements for solid waste services from containing provisions that excused a service provider from complying with the agreement in the event of a work stoppage associated with a labor dispute; - - AB 699 - would have expanded occupational safety protections to lifeguards employed on a full-time basis in the Boating Safety Unit by the City of San Diego Fire–Rescue Department; - - AB 1145 - would have expanded worker's compensation benefits for certain nurses, psychiatric technicians, and various medical and social services specialists employed by the Department of Corrections and Rehabilitation, the State Department of Developmental Services, and the State Department of State Hospitals. - - SB 640 - would have required any food service contract or hotel development project undertaken by the CSU Board of Trustees to be with employers signatory to labor peace agreements; and - - SB 90 - would have prohibited health plans from imposing a copayment of more than $35 for a 30-day supply of an insulin prescription drug. "Gavin Newsom wants to act like he's both an ally of labor and an ally of Big Business," said Chris Griswold, Teamsters International Vice President At-Large and President of Teamsters Joint Council 42. "The last thing America needs right now is more politicians who are friendly with Big Business. What we need is something that's in short supply: elected officials who are going to stand up for workers." ...

Jia Bei Zhu, aka Jesse Zhu, aka Qiang He, aka David He, 62, a citizen of China who formerly resided in Clovis, was arrested on a criminal complaint for manufacturing and distributing misbranded medical devices in violation of the federal Food, Drug, and Cosmetic Act (FDCA) and for making false statements to the Food and Drug Administration (FDA). According to court documents, between December 2020 and March 2023, Zhu and others manufactured, imported, sold, and distributed hundreds of thousands of COVID-19 test kits, in addition to test kits for HIV, pregnancy, clinical urinalysis, and other conditions in the United States and China. They did so through the companies Universal Meditech Incorporated (UMI) and Prestige Biotech Incorporated (PBI), which were based in Fresno and Reedley. UMI and PBI did not obtain the required authorizations to manufacture and distribute the test kits and mislabeled some of the test kits. When questioned by FDA officials, Zhu made false statements about his identity, his ownership and control of UMI and PBI, and the activities of UMI and PBI. According to the criminal complaint, Reedley Code Enforcement officials received a complaint regarding a warehouse in Reedley for using non-permitted plumbing that was visible from outside the warehouse. When code enforcement officials went to the warehouse the next day, they saw various types of in vitro diagnostic test kits, related manufacturing equipment, and shipping supplies. Further investigation found that UMI first registered as a medical device manufacturer with the FDA in November 2015 in Tulare and moved to Fresno in 2018. FDA records show that its registration lapsed in 2022, and it is no longer permitted to manufacture or import any in vitro diagnostic test kits in the United States. Any test kits that the company manufactured or imported after that date are considered misbranded medical devices. To manufacture, import, and distribute COVID-19 test kits in the United States during the pandemic, a company must have applied for, and ultimately received, an Emergency Use Authorization (EUA) from the FDA. According to FDA records, UMI applied for an EUA for its COVID-19 test kits, but never received it due to major deficiencies in UMI’s test studies. In November 2022, Fresno County officials notified UMI that they were going to inspect UMI’s Fresno facility to ensure everything was up to code following a fire that occurred at the facility. FDA officials then received an email from UMI’s attorney saying that the company had gone out of business and sold its assets to PBI, a company that was formed in Las Vegas, Nevada. PBI was never registered with the FDA to manufacture or import any in vitro diagnostic test kits in the United States, and never received an EUA to manufacture and distribute COVID-19 test kits. Therefore, any such test kits would be misbranded medical devices. According to the criminal complaint, during the investigation, Zhu made several false statements to FDA officials, including that his name was Qiang “David” He; that he was hired by UMI as a COVID-19 consultant in 2021; that he was hired by PBI just a couple of weeks ago to communicate with government agencies and dispose of property at the warehouse as requested by those agencies; that he did not know anything about the manufacturing or distribution histories for UMI or PBI; and that he knew nothing about an Amazon webpage showing PBI‑branded pregnancy test kits for sale or a shipment of 47,500 pregnancy test kits from China to UMI at an address in Las Vegas. This case is the product of an investigation by the FDA Office of Criminal Investigations, with assistance from the Federal Bureau of Investigation and the California Department of Public Health – Food and Drug Branch. Assistant U.S. Attorneys Joseph D. Barton, Arelis M. Clemente, and Henry Z. Carbajal III are prosecuting this case. If convicted, Zhu faces a maximum statutory penalty of three years in prison for the misbranding of medical devices charge, and five more years in prison for the false statements charge ...

The Insurance Commissioner issued a May 24, 2023 Decision on the Workers’ Compensation Insurance Rating Bureau of California (WCIRB) September 1, 2023 Regulatory Filing. Since then, the WCIRB has issued over 90 percent of the January 1, 2024 experience modifications (X-Mods) that insurers, agents/brokers and policyholders rely on for January policy renewals. The following are several tools to access published X-Mods and check the status of a pending X-Mod. The WCIRB provides these tools for member insurers and their authorized third-party administrators (TPAs) and managing general agents (MGAs) as well as licensed agencies and brokerages. See the How to Access X-Mods: A Comparison of WCIRB Products chart for various ways to access X-Mods. WCIRB Connect® - Insurer and agent/broker users of WCIRB Connect can view the X-Mod for any policyholder. Authorized users may view and download a PDF of published experience rating worksheets (ratesheets). Insurers are also able to search their own policies for X-Mods that are pending due to missing data. X-Mod Direct® - X-Mod Direct allows Connect users to request an email when a new or revised X-Mod is issued for a policyholder. To set an alert, click the "Subscribe to X-Mod Direct" button in the ribbon at the top of the Policyholder Details screen. Comprehensive Risk Summary (CRS)® Report - Authorized users can quickly obtain detailed policyholder information in Connect with the CRS Report. The automated process will request authorization directly from the policyholder. The report includes the following information: - - Up to 10 years of historical data - - Primary policyholder name, address and Bureau Number - - All classifications reported on policies that incepted within the last five years - - WCIRB assigned classifications - - All policyholder names and FEINs reported on policies that incepted within the last five years - - All addresses and locations reported on all current policies - - All exposure and loss details on policies that incepted within the last eight years Visit the CRS Report page for more information. X-Mods and More® - This API web service is for member insurers and their authorized TPAs and MGAs as well as licensed agencies and brokerages. It provides real-time, automated retrieval of the following information to assist in underwriting workers’ compensation policies in California: - - X-Mods - - Assigned classification codes - - Previously reported policyholder names and addresses, FEINs and other information See the X-Mods and More® Web Service User Guide. Additional Resource - September 1, 2023 Regulatory Filing Documents ...

The president of a Silicon Valley-based medical technology company was sentenced to eight years in prison and ordered to pay $24 million in restitution for participating in a scheme to defraud investors and a scheme to commit health care fraud and pay illegal kickbacks in connection with the submission of over $77 million in claims for COVID-19 and allergy testing. A federal jury convicted Schena on Sept. 6, 2022 60 year old Mark Schena, who lives in Los Altos, California, served as the president of Arrayit Corporation. Schena engaged in a scheme to defraud Arrayit’s investors by claiming that he had invented a revolutionary technology to test for virtually any disease using a single drop of blood from a finger stick sample. In meetings with investors, Schena and his publicist claimed that Schena was the "father of microarray technology" and that he was on the shortlist for the Nobel Prize. Schena also falsely represented to investors that Arrayit could be valued at $4.5 billion. Schena orchestrated an illegal kickback and health care fraud scheme that involved submitting fraudulent claims to Medicare and private insurance for unnecessary allergy testing. Arrayit ran allergy screening tests on every patient for 120 different allergens regardless of medical necessity. To obtain patient blood specimens, Schena paid kickbacks to marketers in violation of the Eliminating Kickbacks in Recovery Act and orchestrated a deceptive marketing plan that falsely claimed that the Arrayit test was highly accurate in diagnosing allergies, when it was not, in fact, a diagnostic test. The Health Care Fraud Unit’s Data Analytics Team supported the prosecution and, as the evidence at trial showed, Arrayit billed more per patient to Medicare for blood-based allergy testing than any other laboratory in the United States. In early 2020, Schena falsely announced that Arrayit "had a test for COVID-19." Schena told federal agents that it was simple to develop a test for COVID-19 because the switch from testing for allergies to testing for COVID-19 was "like a pastry chef" who switches from selling "strawberry pies" to selling "rhubarb and strawberry pies." Seeking to capitalize on the nationwide shortage of COVID-19 testing, Schena orchestrated a deceptive marketing scheme that falsely claimed that Dr. Anthony Fauci and other prominent government officials had mandated testing for COVID-19 and allergies at the same time, and required that patients receiving the Arrayit COVID-19 test also be tested for allergies. Schena also concealed from investors and patients that the Food and Drug Administration had informed him that the Arrayit test was not accurate enough to receive an Emergency Use Authorization for use in the United States. In furtherance of the scheme, Schena failed to release Arrayit’s financial disclosures - as required by the Securities and Exchange Commission (SEC) - and concealed that Arrayit was on the verge of bankruptcy. Schena lulled investors who were concerned that the company was a "scam" by engaging in television appearances and filming videos that fraudulently portrayed the laboratory as busy and high-tech. Schena also issued false press releases and public statements on social media that Arrayit had entered into lucrative partnerships with companies, government agencies, and public institutions, including a children’s hospital and a major California health care provider. The press releases and statements falsely claimed that such entities had agreed to use the Arrayit technology, when in fact no such agreements existed or were of minimal value ...

Given the exceedingly narrow scope of judicial review of arbitration awards, assuring both the actual and apparent impartiality of a neutral arbitrator is crucial to the legitimacy of arbitration as a dispute resolution mechanism. This month, a Court of Appeal published opinion illustrated on of the rare instances where an arbitration award was vacated for the impression of possible bias. In January 2019, plaintiff FCM Investments, LLC (FCM) signed a Purchase Agreement to buy real property in Riverside, California from defendant Grove Pham, LLC (Grove), a company owned by Phuong Pham. Grove operated a nursing home on that property with resident patients. FCM agreed to pay Grove $7.45 million to buy the property, with an upfront deposit of $500,000. Escrow was to close in 30 days. Disputes arose during the due diligence process, with the parties extending the escrow closing date several times. By April 2019, FCM filed a complaint in Riverside Superior Court against the sellers alleging that their dilatory tactics were preventing completion of the sale. The parties were required to mediate "any dispute or claim" and arbitrate disputes not resolved by arbitration. Ultimately the parties stipulated to arbitrate their disputes before Honorable Judith C. Chirlin (Ret.) of Judicate West. Arbitration proceeded over two days in June 2021. The arbitrator concluded that the Phams breached the Joint Addendum by failing to provide proof of 66 live-in patients or a notarized agreement regarding the use of Longha’s license. FCM was accordingly justified in terminating escrow. FCM was awarded a return of its deposit with interest, loss-of-bargain damages of $9.1 million plus interest, $127,040 in attorney’s fees, and $20,048 in costs. FCM filed a petition to confirm the arbitration award, while the Phams moved to vacate it pursuant to the California Arbitration Act (Code of Civ. Proc., § 1280 et seq.). Emphasizing the narrow scope of judicial review, FCM opposed the petition to vacate. Following hearings in December 2021 and January 2022, the court denied the Phams’s motion to vacate and entered judgment for FCM confirming the arbitration award. The Court of Appeal vacated the arbitration award in the published case of FCM Investments v. Grove Pham, LLC - D080801 (October 2023). Although the Phams asked to vacate the arbitration award on multiple grounds, the Court of Appeal largely focused on one. In making an adverse credibility finding against Phuong based on her use of an interpreter, the arbitrator’s decision creates a reasonable impression of possible bias requiring that the arbitration. The arbitrator found the seller in breach based largely on an assessment of witness credibility. She felt the case was unique "both in 12 years of doing arbitration and 24½ years on the Los Angeles County Superior Court, in that the lack of credibility issues are so rampant and obvious." In the arbitrator’s view, defendant Phuong Pham lacked credibility because she used an interpreter during the arbitration proceedings. Reasoning that she had been in the country for decades, engaged in sophisticated business transactions, and previously functioned in some undisclosed capacity as an interpreter, the arbitrator felt that her use of an interpreter at the arbitration was a tactical ploy to seem less sophisticated. While arbitration awards are "nearly immune" from attack, "one of the limited grounds for challenge is bias on the part of the arbitrator." Courts are empowered to act where that impartiality can reasonably be questioned. "[A]ny tribunal permitted by law to try cases and controversies not only must be unbiased but also must avoid even the appearance of bias." (Commonwealth Coatings Corp. v. Continental Casualty Co. (1968) 393 U.S. 145, 150.) "Sensitivity toward language difficulties is the hallmark of our multi-lingual state." (People v. Aguilar (1984) 35 Cal.3d 785, 794; see Gov. Code, § 68560, subd. (e).) Across California, "approximately 40 percent of us speak a non-English language at home; there are more than 200 languages and dialects spoken; roughly 20 percent of us (nearly 7 million) have English language limitations." "Arbitration proceedings were unreported, leaving us to guess what evidence, if any, was presented as to Phuong’s English proficiency during arbitration." "As a factual matter, FCM’s own pleadings undercut the notion that Phuong’s use of an interpreter was a ploy. In its original complaint, filed long before the relationship between the parties completely unraveled, FCM acknowledged that Phuong used her daughter as a translator during a conference call based on her daughter’s 'proficiency in English.' If Phuong relied on her daughter to translate a conference call before the deal unraveled, it seems unsurprising that she would use an interpreter to testify in commercial arbitration proceedings." Here, the arbitrator’s credibility finding "rested on unacceptable misconceptions about English proficiency and language acquisition. These misconceptions, in turn, give rise to a reasonable impression of possible bias on the part of the arbitrator requiring reversal of the judgment and vacating the arbitration award." ...

The Labor Commissioner’s Office (LCO) has cited Hyatt Regency Long Beach $4,799,564 for failing to timely offer job positions to 25 employees laid off during the COVID-19 pandemic once the hotel increased its business operations and began rehiring employees, as required by the Right to Recall law (SB 93). The employees included restaurant servers, event servers, bartenders, housepersons, turndown attendants, cashiers, and stewards. "Some of these employees had as much as 24 years of experience, and were suddenly out of work due to a public health emergency," said Labor Commissioner Lilia Garcia-Brower. "The employer failed to offer them their old jobs back in compliance with the law." The LCO started its investigation in September 2022 after receiving complaints from numerous workers of the Hyatt Regency Long Beach. The investigation included issuing subpoenas, interviewing workers, and conducting depositions of HR managers. LCO issued a citation against Hyatt Regency Long Beach for 8,983 aggregate days of violations under the law. The law allows liquidated damages of $500 per worker for each day the employee’s recall rights are violated. The $4,799,564 citation will be paid to the 25 affected employees. The Right to Recall law requires employers in the hospitality and building services industries to offer available job openings that are the same or similar to jobs held by workers laid off during the pandemic, based on company seniority. The law went into effect on April 16, 2021 and has been extended to December 31, 2025. The LCO has cited numerous employers for violating the Right to Recall law. In July 2022, Terranea Resort workers received $1.52 million following a settlement reached by LCO with the resort related to citations the LCO issued for the resort’s failure to comply with the worker retention law. The affected workers had been laid off and were not timely offered jobs after the resort re-opened for business in 2021. The Department of Industrial Relations’ Division of Labor Standards Enforcement (California Labor Commissioner’s Office) combats wage theft and unfair competition by investigating allegations of illegal and unfair business practices ...

Self-insured groups (SIG) are created by business owners pooling their resources to achieve greater control, improved claims outcomes and lower overall costs. Members share in any surpluses or shortfalls of funding needed to cover claims and operating costs of the group.California has adopted and supports the self-insurance option despite pressure from parts of the legal and financial community that oppose it. The California Restaurant Mutual Benefit Group (CRMBC) is a California Self-Insured Group formed by restaurant owners choosing to opt out of commercial insurance. CRMBC is the only Workers' Comp Self-Insured Group for California Restaurants. In an often-problematic industry, it has also become California’s largest self-insured group with more than 3,000 members and annual payroll greater than $1 billion. Statistics presented at its annual meetings reflect improvement across the board since the plan was founded in 2005. Members share in any surpluses or shortfalls of funding needed to cover claims and operating costs of the group. In the early years of CRMBC, mismanagement by third-party service providers resulted in the group undercharging itself and incurring an $80 million deficit. The deficit was discovered during a regulatory audit by the State of California Office of Self-Insurance Plans (OSIP). The group’s board of trustees immediately undertook a remediation plan to correct the deficit and to instill strong operational and financial controls going forward. CRMBC appointed a new administrator, implemented cost-cutting measures, and completely overhauled their claims management and loss control providers and procedures. This month CRMBC announced that it has successfully raised $100 million in capital over the past decade from its members and through diligent fiscal controls. These actions combined with member assessments resulted in a remarkable turnaround resulting in a fiscally strong and sound group today. Interestingly, CRMBS said "even with the additional assessment, many members still paid less overall than they would have paid to a traditional carrier." "Our team did a full analysis of what we paid in premiums including our assessment compared to what we would have paid in the commercial market, and we still paid less by staying in CRMBC," reported Bryce Myers, Owner of 21 Sizzler Franchise locations and a Richie’s Real American Diner. To further limit past exposure and turn the page on the early days of the Group, CRMBC completed two loss portfolio transfers (LPTs) approved by OSIP where Safety National Insurance assumed all responsibility for past legacy program claims from 2004 through 2015. This freed the members from liability exposure of the past and assisted them to begin focusing on the present and future health of the group. In 2023, accompanying the recently announced new leadership of CRMBC, The PATH Alliance was appointed as the group’s new Administrator beginning in May. PATH brings extensive expertise in financial management, regulatory compliance, claims oversight, safety and loss prevention, and member service to the group. LWP Claims Administration is the third-party administrator handling all claims for the group, while ALC Consulting is an outside claims consultant providing independent claims oversight ...

In the wake of California's statutory mandate for a higher minimum wage for healthcare workers, multiple financial problems are on the horizon for the industry as a whole, and retail pharmacies are the latest example. Rite Aid filed for Chapter 11 bankruptcy protection on October 16, 2023. The company had been struggling with falling sales and opioid-related lawsuits. It is the third-largest pharmacy chain in the United States, with over 2,100 stores in 17 states. The company has been losing money for several years, and its stock price has plummeted. It is unclear how long Rite Aid will be in bankruptcy. The company said that it expects to emerge from bankruptcy within the next six to nine months. In addition to its financial problems, Rite Aid is also facing a number of lawsuits from states and municipalities alleging that the company contributed to the opioid epidemic by overprescribing prescription painkillers. The Wall Street Journal reports that Rite Aid will will reportedly close roughly 400 to 500 of its approximately 2,200 stores by the end of its bankruptcy. At the same time CNN reports on walkouts by Walgreens pharmacists and technicians around the country and at CVS stores in Kansas City over low pay and understaffed stores. The majority of drugstores’ sales comes from filling prescriptions. But their profits from that segment have declined in recent years because of lower reimbursement rates for prescription drugs. The front end of drugstores, where they sell snacks and household staples, also face pressure. CNN also reports that CVS, Walgreens and Rite Aid are eliminating some locations as they face rising competition for these items from Amazon, big-box stores with pharmacies like Walmart, and Dollar General in rural areas. Theft has become a problem for drugstores in some locations, and some stores have resorted to locking up products to prevent theft. But this has made the customer experience worse. Drugstores are trying to pivot into the more lucrative health care industry in recent years and become primary care providers. CVS acquired health insurer Aetna, and Walgreens took a majority stake in primary care network VillageMD. But this strategy requires fewer brick-and-mortar retail stores. Retail pharmacy chains overexpanded in the past, often pushing out local pharmacies in the process.The number of independent pharmacies decreased by nearly 50% from 1980 to 2022, according to McKinsey. Rite Aid, CVS and Walgreens have also been shuttering stores for years. CVS, the largest US chain, closed 244 stores between 2018 and 2020. In 2021, it announced plans to close 900 stores by 2024. Walgreens said in 2019 it would close 200 stores and in June announced an additional 150 store closures. A study published in the Journal of the American Medical Association found that pharmacies at greatest risk for closures are those with a large customer base on public insurance, which have lower reimbursement rates than private plans, as well as independent pharmacies ...

California's current minimum wage is $15.50 per hour. Some cities in California have established minimum wages that are higher than the current statewide minimum wage. Since the start of 2022, spearheaded by SEIU-United Health Workers, several California cities have passed or introduced ordinances for a $25 per hour minimum wage for healthcare workers. Some of these ordinances have been challenged and put on hold after petitions for referendum were submitted to put the matter before city voters. This is now all about to change after Governor Newsom signed Senate Bill 525 into law late Friday. This bill incorporates a limited moratorium on such future initiatives, but preserves the recent health care worker $25 minimum wage initiative passed by voters in Inglewood. Amendments to the new law on September 11 struck the flat minimum wage increase provisions initially proposed when the bill was introduced, and instead implemented a tiered schedule of increases for differing employers based on specified factors. Generally speaking the new law provides: - - Dialysis clinics and large health systems with more than 10,000 workers would pay a minimum wage of $23 an hour in 2024, $24 in 2025, and $25 in 2026. - - Community clinics would start the pay increase at $21 per hour in 2024, rising to $22 in 2026 and $25 in 2027. - - Other health care employers would increase their minimum wage to $21 per hour in 2024, $23 in 2026 and $25 by 2028. - - Hospitals with a high mix of Medi-Cal and Medicare patients, as well as rural independent hospitals would have to pay workers $18 an hour in 2024. That rate would increase 3.5% annually until it reaches $25 in 2033. This new law was highly controversial, and there is a long list of organizations who were in favor, or who opposed the law. SEIU California was the sponsor of this law arguing, among other things that "Care work has historically been undervalued by society. A recent report on the California nursing home workforce characteristics found that 1 out of every 2 Skilled Nursing Facility workers earns less than $20 per hour." Opponents argued that, "In the aftermath of the COVID-19 pandemic, health care providers in California are in dire financial straits. One major hospital has already closed, others are on the brink, and more than half are losing money every day to care for patients." They also argue that, "SB 525’s added costs will force health providers to cut hours, positions and services. With fewer positions and potentially fewer providers, health care professionals will have fewer opportunities, be at heightened risk of job loss, and have less flexibility in the positions that are available." The California Nurses Association/National Nurses United is opposed unless amended to exempt RNs from the scope of the bill. They argue that, “the inclusion of RNs in this bill will ultimately lower the wage floor for RNs, encouraging employers to propose takeaways on wages during bargaining. California RNs are currently among the highest paid in the nation well above the proposed $25 minimum hourly wage for health care workers in SB 525. According to the U.S. Bureau of Labor Statistics, the median hourly wage for California RNs is $60.26, while RNs in the lower 10th percentile make $37.53. In other words, one would be extremely hard pressed to identify anyone working as an RN in California who makes below $25/hour." ...

49 year old Steven Donofrio, who lives in Temecula, California, man has been sentenced to federal prison for conspiring to commit health care kickbacks. Donofrio was found guilty by a jury on May 5, 2023, following a two-week-long trial and was sentenced to 42 months in federal prison by U.S. District Judge Robert W. Schroeder, III on October 11, 2023. 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, of Eagle, Colorado; Nicolas Arroyo, of Tempe, Arizona; Vincent Marchetti, Jr., of Coronado, California; William Flowers, of Houston, Texas; Steven Donofrio; James J. Walker, Jr. a/k/a Jimmy Walker, of Frisco, Texas; Timothy Armstrong, deceased, formerly of Frisco, Texas; Virginia Blake Herrin, of Frisco, Texas; Patrick Ridgeway, of Jackson, Mississippi; Chismere Mallard, of McAllen, Texas; Dr. Ray W. Ng, of Dallas, Texas; and Ashley Kretzschmar, 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, of Friendswood, Texas, and Edwin Chad Isbell, 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. On September 11, 2023, Jimmy Walker was sentenced to five months in federal prison and ordered to pay a $50,100 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. "Today’s sentence brings a conclusion to an illegal kickback scheme that defrauded our health care system for millions of dollars. The defendant and his co-conspirators enriched themselves and in turn affected the quality of care of innocent taxpayers," said FBI Dallas Special Agent in Charge Chad Yarbrough. "The FBI is committed to working with our law enforcement, public, and private sector partners to combat health care fraud and seek justice for the patients that are harmed because of these schemes." 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 ...

It is interesting how so many people carefully shop for an investigate their next appliance or television purchase, but how so few can tell you even the brand of hip or knee replacement that a surgeon placed inside their body. It is as though the brand of implantable device does not matter, and their seems to be an assumption that they are all the same. A bad choice certainly has consequences, to the person who must undergo another painful surgery, and for the third party payor - such as a workers' compensation claim administrator - who must pay tens of thousands of dollars in medical costs to remedy the situation. The current litigation against Exactech is an excellent illustrative example. Exactech’s fortunes started to take off in 1994, when it inked a major deal to license and market the Optetrak knee implant based on designs by surgeons and engineers at the prestigious Hospital for Special Surgery in New York City. That alliance won Exactech instant credibility in the fiercely competitive device industry. Exactech was first introduced in 2006. It is made of titanium and a plastic called polyethylene. The Optetrak implant was designed to be more durable and longer-lasting than other total knee replacement (TKR) implants. Building on that goodwill, Exactech’s sales shot past $124 million in 2007, about half generated by the Optetrak knee system. The US Food and Drug Administration issued a number of safety warnings about the Optetrak implant. In 2012, the FDA issued a Class I recall of the Optetrak implant, which is the most serious type of recall. The recall was issued due to concerns about early failure of the implant. In 2015, the FDA issued a Class II recall of the Optetrak implant due to concerns about loosening and osteolysis. The recall was issued after the FDA received reports of a number of patients who had experienced loosening and osteolysis of their Optetrak implants. There are a number of class action lawsuits pending against the manufacturers of the Optetrak knee implant. These lawsuits allege that the implant is defective and has caused serious injuries to patients.The first class action lawsuit against the manufacturers of the Optetrak knee implant was filed in 2012. This lawsuit was filed on behalf of patients who had experienced early failure of their implants. Since then, a number of other class action lawsuits have been filed against the manufacturers of the Optetrak knee implant. KFF Health News just featured a report on this problem, and what went wrong. It reports that there were " years of warnings and doubts about the durability of the Optetrak, according to whistleblowers - one whistleblower called it an "open secret" inside the company. Notably, there were concerns about the fragility of a finned tibial tray, one of the four pieces of the knee replacement that fits into the shin bone, according to the whistleblower lawsuit. Whistleblower Manuel Fuentes, a former Exactech senior product manager, testified in a deposition that pulling the product off the market around 2008 "would have been the ethical and moral thing to do." Exactech discussed the loosening problem in an internal memo that said between 2006 and 2009 the company "began to get some negative feedback" about the Optetrak "that was at times confounding and difficult to process," court records show.The discouraging reports ranged from complaints of early revisions from at least 10 U.S. surgeons and surgery practices in several of the more than 30 countries where Exactech sold the implant, court records show. The results did little to dim Exactech’s prospects. From 1994 through April 2022, Exactech sold 58,763 Optetrak devices with finned trays for use by 514 surgeons nationwide, according to an affidavit by a company official. While 95% of artificial knees should last at least a decade, surgeons had to pull out and replace many Optetrak components - a complex operation known as revision surgery - much sooner, according to allegations in patient lawsuits. The Food and Drug Administration runs a massive, public, searchable databank called MAUDE "Manufacturer and User Facility Device Experience" to warn the public of dangers linked to medical devices and drugs. This tool might be a good start for a due diligence investigation by a Claims Administrator to ascertain the track record of orthopedic devices. Manufacturers must advise the FDA when they learn their device may have caused or contributed to a death or serious injury, or malfunctioned in a way that might recur and cause harm.Those reports must be submitted within 30 days unless a special exemption is granted. But court and government records show that reports of adverse reactions tied to Exactech’s implant sometimes took years to show up in the government database — if they were reported at all ...

The Labor Commissioner’s Office (LCO) Criminal Investigation Unit partnered with the Los Angeles District Attorney’s Office in the first criminal prosecution of a garment manufacturing business owner under California Penal Code Section 487m (Grand Theft of Wages), which became effective on January 1, 2022. Lawrence Lee, co-owner of garment manufacturer business Parbe Inc., dba Fabiola, and Soon Ae Park, a garment contractor who had a history of wage theft, have been arraigned on felony charges of grand theft of wages and perjury by declaration. "This is the first time a garment manufacturer and garment contractor have ever been arrested for wage theft," said Labor Commissioner Lilia García-Brower. "These employers not only abused their workers by paying them as little as $6.00 per hour but they also defrauded the system. My office will continue to work with the Los Angeles District Attorney’s office to prosecute bad-actor employers who commit wage theft and gain an unfair advantage over law-abiding employers." The LCO’s Bureau of Field Enforcement (BOFE) began its investigation of Park, a sewing contractor, in January 2021, and the case was referred to the LCO’s Criminal Investigative Unit in December 2021. Investigators determined there was probable cause to believe Soon Ae Park and Lawrence Lee committed grand theft of labor and perjury. Lawrence Lee and Soon Ae Park were arrested on September 6, 2023 and arraigned thereafter. The investigation found that Park failed to pay her workers minimum wage or overtime, paid her workers in cash an average of $350 for more than 50 hours of work per week, and failed to provide workers with paystubs. Park also failed to provide workers with workers’ compensation insurance coverage or information about paid sick leave. Parbe Inc., identified as a wage guarantor for Park, contracted with Park even after the Labor Commissioner’s Office notified it of alleged wage violations by Park. Both Parbe Inc. and Park were operating without required garment manufacturing registrations. Lawrence Lee also allegedly failed to provide material information on his garment manufacturing registration application under penalty of perjury. In addition to these criminal charges, BOFE issued Notices of Joint Liability to Park and Parbe Inc. for over $81,000 for their failure to provide workers’ compensation coverage for their employees. Park was cited more than $70,000 for violation of the paid sick leave requirements, violating record-keeping requirements, and violating the garment registration provision. Parbe Inc. CEO Lawrence Lee was cited $4,000 for failure to provide workers with written notice of their paid sick leave, $4,000 for violation of record-keeping provisions, and $200 for violation of the garment registration provision. The citations totaled $161,738. Under the Garment Worker Protection Act, contractors, manufacturers, and brand guarantors are jo­­intly and severally liable for the full amount of unpaid minimum, regular, overtime and other premium wages, reimbursement for expenses, and any other compensation, including interest, due to all employees who perform manufacturing operations under this law. Enforcement investigations typically include a payroll audit of the previous three years to determine minimum wage, overtime, and other labor law violations, and to calculate payments owed and penalties due. When workers are paid less than minimum wage, they are entitled to liquidated damages that equal the amount of underpaid minimum wages plus interest. The Department of Industrial Relations’ Division of Labor Standards Enforcement (California Labor Commissioner’s Office) combats wage theft and unfair competition by investigating allegations of illegal and unfair business practices ...

As National Whistleblower Day approaches, a bipartisan group of senators, led by Sen. Chuck Grassley (R-Iowa), introduced the False Claims Amendments Act of 2023 to beef up the government’s most potent tool to fight fraud. The bill ensures those who knowingly defraud the government cannot escape liability in cases where the government has made recurring payments on a fraudulent claim. The bill is cosponsored by Sens. Dick Durbin (D-Ill.), John Kennedy (R-La.) and Roger Wicker (R-Miss.). "The False Claims Act continues to be the single greatest tool in the fight against fraud, returning $72 billion to the taxpayer since my update to the statute in 1986. Unfortunately, flawed court interpretations have created loopholes for fraudsters to avoid accountability even when their fraud is obvious and undisputed. Taxpayers deserve better than this sort of legal gymnastics. Our bipartisan bill clarifies our original intent to hold those accountable when they bilk the taxpayer," Grassley said. 'We must ensure that our government uses taxpayer dollars wisely and efficiently. This bill would do just that by strengthening the False Claims Act - a tool used by the federal government to fight fraud and recoup lost taxpayer dollars. I’m thankful for this bipartisan cooperation to help fight fraud, waste, and abuse, and I’ll work to help this bill move swiftly through the Senate,' Durbin said. The False Claims Act empowers the government - often with the help of whistleblowers - to recover taxpayer dollars lost to fraud from entities that defraud the government. The U.S. Supreme Court flawed ruling in United Health Services v. United States ex rel. Escobar has resulted in entities claiming that their obvious fraud was not material simply because the government continued payment. The False Claims Amendments Act of 2023 makes clear that the government’s continued payment on a fraudulent claim is not dispositive evidence that the fraud was not material if the government shows other reasons exist for the payment. It also clarifies that the False Claims Act’s whistleblower anti-retaliation provision applies to post-employment retaliation, and requires a GAO study on the benefits and challenges of enforcement efforts and amounts recovered under the False Claims Act. "Taxpayers Against Fraud applauds Senator Grassley's continued strong support of the False Claims Act," said Taxpayers Against Fraud President & CEO Jeb White. "The Senator is a consistent champion of Lincoln's Law, which saves taxpayers billions of dollars every year. Regularly updating and modernizing the law ensures our federal anti-fraud statutes can meet the challenges created by today's fraudsters who seek to steal and misuse taxpayer funds. We appreciate Senator Grassley's tenacious leadership and look forward to full congressional passage of this bipartisan legislation." In 1986, Grassley led the successful effort to update the False Claims Act, which allows the government to recover taxpayer dollars from entities that defrauded federal agencies. A key provision in that update, known as qui tam, allows whistleblowers to bring suits against alleged fraudsters on behalf of the government and share in any recoveries. That provision is credited with more than two-thirds of all False Claims Act recoveries since 1987. In February, the Justice Department announced the successful recovery of over $2.2 billion through False Claims Act cases that would have otherwise been lost to fraud in FY2022. More $1.9 billion of those claims were recovered through Grassley’s qui tam provision. A total of more than $72 billion in taxpayer money has been recovered since the 1986 update to the law ...

Tracey D. Brown, EVP, president of Walgreens retail & chief customer officer, underscored Walgreens transformation into a helathcare company that solves challenges that face the industry. She emphasized the power of the fourth network and community-based solutions that make quality healthcare more accessible while improving outcomes and lowering costs - an approach with the potential to transform the way we engage with our health. "We're launching Virtual Healthcare at Walgreens this month because our goal is to be the most convenient health and wellness destination, whether you're physically in stores or visit Walgreens virtually in stores." Walgreens Virtual Healthcare offering is set to launch in late October 2023. This digital solution will provide discreet, convenient and on-demand medical care for common health needs. It will make it easier for individuals to receive online diagnoses and prescriptions, making healthcare accessible and affordable at any time. Meeting patients where they're at is core to Walgreens mission, and Walgreens Virtual Healthcare aims to improve access to fast, reliable, affordable care. Some of the key benefits include: - - An easier way to get care, when you need it: Patients will be able to connect easily with doctors and nurse practitioners through virtual or chat-based consultations. For certain conditions, video visits with healthcare providers will be available, all on the patient's terms and from the convenience of their own devices. - - Care and treatment for some of the most common health needs: Walgreens Virtual Healthcare will provide on-demand medical care and treatment for some of the most common health needs, including respiratory illness, allergies, urinary tract infections (UTIs) and acne. - - Streamlined treatment access: After patients connect with a provider either via chat or video, Walgreens Virtual Healthcare enables them to get their prescriptions filled from their preferred pharmacy, including at Walgreens pharmacies or with Walgreens Same-Day Prescription Delivery. - - Affordable pricing: Most Walgreens Virtual Healthcare chat visits will be priced at $33 out-of-pocket, with pricing for video visits varying from $36-75, making healthcare more affordable and accessible. At this time, insurance is not accepted for Walgreens Virtual Healthcare visits, but it can be used to cover the cost of prescriptions. In the future, Walgreens Virtual Healthcare plans to accept insurance, Flexible Spending Accounts and Healthcare Savings Accounts will be accepted. Patients in select states will be able to access Walgreens Virtual Healthcare at Walgreens.com beginning in late October. These initial states cover nearly half of the U.S. population and half of Walgreens pharmacy customers. Walgreens plans to expand the service to cover additional conditions and markets in the near future ...

In March 2020, because of the reduction in business caused by the COVID-19 pandemic, Hyatt decided to furlough or temporarily lay off over 7,000 employees. Plaintiffs, Karen Hartstein filed a class action complaint in Los Angeles County Superior Court on behalf of a putative class of California Hyatt employees, asserting claims under California law for failure to pay all wages upon discharge,waiting time penalties, failure to furnish accurate wage statements, unfair business practices, and enforcement under the Private Attorneys General Act ("PAGA"). Hyatt removed the action to federal court. The district court granted Hyatt’s motion for summary judgment, denied Plaintiff’s motion for partial summary judgment, and dismissed the action with prejudice. The district court concluded that the March 2020 furlough of Hyatt’s employees was not a termination within the meaning of Labor Code § 227.3 because there was not a complete severance of the employer-employee relationship. The court also rejected Plaintiff’s claim that the value of the complimentary hotel rooms class members were eligible to receive constituted wages they should have received upon discharge. And because it concluded that Hyatt was not required to pay the accrued vacation in March 2020, the district court declined to address whether Hyatt was liable for waiting time penalties under § 203 and whether Hyatt had a good faith dispute about the payments. The 9th Circuit Court of Appeals reversed as to the vacation pay claim, and affirmed the dismissal of the value of the hotel room claims in the published case of Harstein v Hyatt Corporation -22-55276 (September 2023). Hyatt did not contest that it was required to pay its employees their accrued vacation pay when the employees were discharged. The question is when the employees were discharged within the meaning of California’s prompt payment provisions. Plaintiff argues that the indefinite layoff in March 2020 was a "discharge" within the meaning of Labor Code § 201(a), triggering Hyatt’s obligation to pay accrued vacation pay. Hyatt contends that it was not required to pay accrued vacation pay until June 2020, when employees were formally terminated. Section 201 does not define "discharge." The question accordingly is whether a temporary layoff, with no specified return date, is a discharge for purposes of § 201. "We have not found, and the parties have not cited, any caselaw that addresses this question. However, the California Division of Labor Standards Enforcement ('DLSE') has answered the question explicitly." The DLSE is the state agency empowered to enforce California’s labor laws. In Opinion Letter 1996.05.30, the DLSE addressed an employer’s question "regarding the obligation of an employer to pay wages due at the time of a ‘temporary layoff." The DLSE replied that, "if an employee is laid off without a specific return date within the normal pay period, the wages earned to and including the lay off date are due and payable in accordance with Section 201." The DLSE cited Campos v. Employment Development Department, 183 Cal. Rptr. 637 (Ct. App. 1982), which addressed "whether workers on indefinite layoff are disqualified from receiving unemployment benefits when they refuse to accept recall offers in the course of a trade dispute." Campos concluded that, "where the employees have no contractual right to recall within any specified time period, the better approach is to treat such layoffs as indefinite, thereby terminating any employment relationship." Thus the Court of Appeals concluded that the prompt payment provisions of the California Labor Code required Hyatt to pay Plaintiffs their accrued vacation pay in March 2020. It therefore reversed the district court’s grant of summary judgment to Hyatt as to the vacation pay claim and remand for the district court to consider whether Hyatt acted willfully in failing to comply with the prompt payment provisions. However, the complimentary hotel rooms Hyatt provided to employees were excludable from the calculation of employees’ regular rate of pay under the Fair Labor Standards Act (FLSA). It therefore affirmed the grant of summary judgment as to the complimentary hotel room claim ...

Labor Code Section 4656 prohibits aggregate temporary disability payments for a single injury occurring on or after January 1, 2008, causing TD from extending for more than 104 compensable weeks within a period of 5 years from the date of injury, except if an employee suffers from certain injuries or conditions. Assembly Bill 1213 introduced by Assembly member Liz Ortega (D-San Leandro) provides that if a utilization review (UR) denial of treatment recommended by a treating physician for an injured worker is overturned by IMR, any TD benefits paid or owing to the injured worker from the date of the UR denial until the date of the IMR decision shall not be used in calculating aggregate TD for which the injured worker is eligible. The California Applicants' Attorneys Association, the sponsor of this bill, writes in support arguing "It is wrong for TD benefits for so many injured workers to end when necessary treatment was erroneously or unreasonably denied, and the denial delayed the injured worker's recovery and return to work." In opposition, California Coalition on Workers’ Comp and other employer organizations, argued the bill is not needed because "The actual delay in the system related to care comes from the overuse of IMR by a small number of attorneys and physicians trying to push care that is conflicting with the state-established guidelines for determining medical necessity." AB 1213 was passed by the California Legislature. However, on October 8, Governor Newsom vetoed the proposed law. In his veto message he said "While I understand the goal of the author and sponsor, there is a lack of data to support such a change. Under the existing workers' compensation system, employers are required to establish a UR process to evaluate the necessity and appropriateness of requested medical treatments. This process is in place to ensure that employees receive the appropriate evidence-based medical care." "Realigning incentives is an important policy tool to deliver on our shared goal of returning injured workers back to work. Such realignment should be done cautiously to avoid further friction in the system that frustrates the objective of providing timely treatment, prompt payment of benefits and returning injured workers back to work. Unfortunately, this bill does not strike the right balance." "For these reasons, I cannot sign this bill." ...

The California Board of Pharmacy (BOP) has listed medication error as the number one violation resulting in a citation in nearly every year within the last several years. According to the Journal of the American Medical Association, 46 percent of adults cannot understand the information listed on their prescription drug labels. Furthermore, the Institute of Medicine of the National Academies indicates that medication errors are among the most common medical errors, harming at least 1.5 million people annually. Pharmacists working in chain community pharmacies, particularly those co-located with other retail and grocery stores, have historically complained that it is common for a pharmacist to be the only employee assigned to the pharmacy area. And according to previously conducted surveys, 83% of pharmacists report being left alone during the workday for an average period of four hours. And a high percentage of pharmacists stated that they do not have enough time to fulfill their professional functions to the extent that they believed necessary. These pharmacists have argued that instead of providing their core pharmacy services, much of their time is instead spent performing clerical tasks and performing non-pharmacy activities on behalf of the business. A new law just signed by Governor Newsom, - Assembly Bill 1286 - is aimed at reducing the estimated 5 million mistakes pharmacists make each year. According to the Author of AB 1286: "The root cause of medication errors in the community chain setting can be tied to pharmacy working conditions, like insufficient staffing, unsanitary conditions, or lack of autonomy to make clinical decisions in the best interest of the patient. Unfortunately, there is no requirement under current law for pharmacies to track medication errors or to consider the pharmacy working conditions that lead to medication errors. AB 1286 will establish a first in the nation mandatory reporting of medication errors to allow for robust evaluation of the causes of medication errors. It also gives licensed pharmacy staff autonomy over their working conditions so they can provide better patient care and services for Californians." The new law empower the pharmacist-in-charge or pharmacist on duty to report conditions to the Board of Pharmacy (BOP) that present an immediate risk of death, illness, or irreparable harm to patients, personnel, or pharmacy staff. If store management does not resolve those conditions within 24 hours, the pharmacist-in-charge or pharmacist would be required to notify the BOP. The BOP would then be authorized to issue an order to the pharmacy to immediately cease and desist those pharmacy operations that are affected by the conditions at issue. This cease and desist order would remain in effect until either the executive officer of the BOP determines that the conditions that presented an immediate risk of death, illness, or irreparable harm to patients, personnel, or pharmacy staff have been abated, or for no more than 30 days, whichever date is earlier. This new law seeks to improve the state's understanding of the causes of medication errors by requiring community pharmacies to report all medication errors to an entity approved by the BOP. A community pharmacy or its designated third party would be required to submit the report no later than 14 days following the date of discovery of the error. Reports would be deemed confidential and not subject to discovery, subpoena, or disclosure pursuant to the California Public Records Act, though the BOP would be authorized to publish deidentified data. The BOP would not be allowed to subject a community pharmacy to discipline or other enforcement action based solely on the report; however, if the BOP receives other information regarding the medication error, that may serve as basis for enforcement by the BOP ...

Gradient AI, an enterprise software provider of artificial intelligence (AI) solutions in the insurance industry, announced the results of a comprehensive research study showing that AI-enabled workers’ compensation claims management reduced legal involvement for lost-time claims by 15%. This reduction translates into a 5% savings in lost-time claim costs, equating to an estimated annual savings of $3.5 million based on the study’s insurers managing an average of $70 million in lost-time claims. Legal involvement is a major cost driver in casualty claims, particularly in the context of lost-time claims. These are cases where an injury is severe enough to require the injured employee to remain out of work for an extended period of time. To better understand the efficacy of AI models trained on industry data lakes, Gradient AI conducted a comprehensive study on workers’ compensation claims. This research encompassed an analysis of over 200,000 lost-time workers' compensation claims, collected from a diverse pool of more than 60 insurance carriers over a 10-year period. Within this dataset, half of the 200,000 claims underwent assessment prior to the integration of AI, while the remaining half were evaluated after AI implementation. Key Findings 15% Reduction in Legal Involvement: Gradient AI's researchers found that lost-time workers' comp claims involving lawyers cost 3x more than claims without legal involvement and lasted nearly 2x as long. The study revealed that insurers leveraging AI effectively reduced legal involvement by 15% because AI models were able to assess claim complexities, predict the likelihood of legal involvement, and provide early warnings to claims adjusters. 5% Reduction in Lost-Time Claims Costs: AI's proactive identification of potential legal engagements resulted in a notable 5% reduction in lost-time claims costs, equivalent to an annual $3.5 million based on the study’s insurers averaging $70 million in lost-time claims. This savings was achieved by providing adjusters with early alerts regarding injury severity and changes in claims status. Early alerts enabled timely actions such as additional attention and outreach by the claims manager and proactive steps to arrange for additional medical treatment. Mitigated the Three Primary Reasons for Legal Representation: Three key factors drive claimants to seek legal representation: - - Erosion of Trust: Prolonged open claims can erode trust between claimants and insurance adjusters over time. AI mitigated this by expediting the process, reducing the need for claimants to seek legal assistance. - - Fear of the Unknown: Claimants often seek legal counsel as a safety net when facing severe injuries or doubts about recovery. AI provided insurers with the ability to proactively address these concerns, thus avoiding legal escalation. - - Intent to Litigate: Some claimants are determined to pursue legal action. AI empowered insurers to intervene early, potentially averting costly legal engagement. Gradient AI said it's study demonstrated that early warnings, based on AI models trained on an extensive industry data lake of workers' compensation policies and claims, enable insurers to proactively manage claims much more efficiently and effectively. This approach results in faster resolution, reduced legal involvement, and substantial cost savings. Full details of the study are available on Gradient AI’s website ...

Bobby Levell Gilbert, Jr., 66 of Santa Ana, and owner of B & J Tree Service, has been charged with 96 felony counts for alleged wage theft, denial of workers’ compensation benefits to employees, workers’ compensation fraud, failure to pay taxes and perjury. Gilbert’s Office Manager, Bertha Rubi Sanchez, 30 of Anaheim, has also been charged with multiple felonies for her alleged role in committing these crimes. Gilbert and Sanchez’ arraignment was continued until December 13, 2023. An investigation by the Department of Insurance revealed that Gilbert took advantage of his workers by denying them what they rightfully earned or were entitled to, for his own enrichment. In total, 32 workers were identified that were either denied the wages they had earned through their hard work, or the workers’ compensation benefits they were entitled to when injured on the job, or both. According to Department Detectives, between October 2013 and August 2021, Gilbert and Sanchez conspired together to underreport payroll to their insurance carriers by approximately $1.3 million. The failure to report employee payroll resulted in the illegal reduction of workers’ compensation insurance premiums, leading to approximately $248,757 in premium owed. The underreported payroll also resulted in an unpaid payroll tax to Employment Development Department of approximately $140,485. "Workers’ compensation insurance is required by law in order to ensure that injured employees can receive the care they need," said the California Insurance Commissioner. "Cases like this one are particularly egregious, employees were not only put at great risk, but they were denied their hard earned wages. We remain committed to working with our partners, including the Orange County District Attorney’s Office, Employment Development Department, and the Department of Industrial Relations to ensure employees get the protections they deserve." This is a joint investigation with Employment Development Department, Department of Industrial Relations and the Orange County District Attorney’s Office. The Orange County District Attorney’s Office is prosecuting the case ...