Labor Code Sections 62.5 and 62.6 authorize the Department of Industrial Relations to assess employers for the costs of the administration of the workers’ compensation, health and safety and labor standards enforcement programs. These assessments provide a stable funding source to the support operations of the courts, to ensure safe and healthy working conditions on the job, to ensure the enforcement of labor standards and requirements for workers’ compensation coverage.

Labor Code Sections 62.5 and 62.6 require allocation of the six assessment types between insured and self- insured employers in proportion to payroll for the most recent year available. Enclosed with a letter is an invoice for the share of the following total assessments, and a document showing the methodology used to compute the assessment amounts and the resulting determination of the respective assessment/surcharge factors. The factors are applied to the premium amount are allocated across the following six categories:

– – Workers’ Compensation Administration Revolving Fund Assessment (WCARF) – – $ 698,761,939
– – Subsequent Injuries Benefits Trust Fund Assessment (SIBTF) – – $ 848,000,000
– – Uninsured Employers Benefits Trust Fund Assessment (UEBTF) – – $ 53,088,800
– – Occupational Safety and Health Fund Assessment (OSHF) – – $ 189,509,130
– – Labor Enforcement and Compliance Fund Assessment (LECF) – – $ 181,983,628
– – Workers’ Compensation Fraud Account Assessment (FRAUD) – – $ 90,435,332

All workers’ compensation insurance policies issued with an inception date during the calendar year 2025 must be assessed to recover amounts advanced on behalf of policyholders. Assessable Premium is the premium the insured is charged after all rating adjustments (experience rating, schedule rating, premium discounts, expense constants, etc.) except for adjustments resulting from the application of deductible plans, retrospective rating or the return of policyholder dividends.

The assessment factors to be applied to the estimated annual assessable premium for 2025 policies are shown in the table on the notice. These are the same factors that were used to calculate the assessment.

The total assessment is calculated based on the direct workers’ compensation premiums reported to the Department of Insurance for Calendar Year 2023 by carriers. The first installment is due on or before January 1, 2025, with the balance due on or before April 1, 2025.

U.S. Attorney Phillip A. Talbert announced that Ifeanyi Vincent Ntukogu, 49, of Fresno, was sentenced to seven years and three months in prison for illegally distributing oxycodone and hydrocodone.

Ntukogu was a pharmacist in Madera who dispensed more than 450,000 oxycodone and hydrocodone pills based on fraudulent prescriptions, all in exchange for cash.

“As a licensed pharmacist, Mr. Ntukogu was trusted to dispense medications safely, supporting positive health outcomes. He intentionally exploited his trusted role, dispensing hundreds of thousands of fraudulently prescribed oxycodone and hydrocodone pills, knowing his greed-fueled actions would put opioids in the hands of drug dealers and could cause grave harm to the public. Working closely with our state and federal law enforcement partners, we dismantled this operation and held those who chose profit over public safety accountable,” said Special Agent in Charge Sid Patel, who leads the FBI Sacramento field office.

“Ntukogo thought he could outsmart the system by rejecting red flag prescriptions all while conducting drug deals on the side for cash. His illicit scheme led to the distribution of nearly half a million highly addictive opioids in Tennessee, Texas and beyond; fueling the fire of prescription drug misuse and endangering American lives,” said DEA Special Agent in Charge Bob P. Beris. “This lengthy sentence underscores the serious consequences for medical practitioners who place profits above people. DEA will continue to work with our counterparts to investigate, arrest and prosecute individuals who abuse their positions and threaten public safety.”

According to court records, from December 2014 through November 2018, Ntukogu dispensed more than 450,000 oxycodone and hydrocodone pills based on fraudulent prescriptions delivered to him by his co-conspirators and co-defendants in the case, Kelo White and Donald Pierre. The prescriptions were from more than 10 different physicians whose signatures were forged.

Ntukogu reviewed each prescription and rejected the ones that he believed regulators may deem suspicious. For example, he rejected prescriptions that were supposedly written by certain doctors or that were written for individuals who were having prescriptions filled at other pharmacies because he believed those prescriptions may raise red flags.

Ntukogu dispensed the pills through his New Life Pharmacy in Madera. Upon doing so, he required cash payments from White and Pierre and increased the price that he charged over time. White and Pierre then illegally sold the pills in Tennessee, Texas, and elsewhere.

Ntukogu received hundreds of thousands of dollars for his participation in the scheme. His sentence was also enhanced because he used his special skills as a pharmacist to help commit the crime.

This case was the product of an investigation by the Federal Bureau of Investigation, the Drug Enforcement Administration, and the California Department of Health Care Services. Assistant U.S. Attorneys Antonio Pataca and Joseph Barton prosecuted the case.

The case was investigated under the DOJ’s Organized Crime Drug Enforcement Task Force (OCDETF). OCDETF identifies, disrupts, and dismantles the highest-level criminal organizations that threaten the United States using a prosecutor-led, intelligence-driven, multi-agency approach. For more information about OCDETF, please visit Justice.gov/OCDETF.

This case was also part of the DOJ’s Operation Synthetic Opioid Surge (SOS), which is a program designed to reduce the supply of deadly synthetic opioids in high impact areas as well as identifying wholesale distribution networks and international and domestic suppliers.

White is scheduled to be sentenced on Feb. 24, 2025. He faces a statutory maximum penalty of 20 years in prison and a $250,000 fine. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory factors and the Federal Sentencing Guidelines, which take into account a number of variables.

Pierre, the remaining defendant in the case, was previously convicted and sentenced to nine years and four months in prison.

“This defendant displayed a blatant disregard for public safety and the law,” U.S. Attorney Talbert said. “It took the effort of agents, investigators, undercover officers, and medical professionals to bring an end to this illicit prescription-writing racket. The U.S. Attorney’s Office will continue our pursuit of those who fuel the opioid epidemic for their own personal benefit.”

Jesus “Jesse” Fonseca worked at Walmart’s Apple Valley distribution center in San Bernardino County for 14 years, During that time he claimed he competently executed all tasks and was commended for his hard work and dedication. His yearly performance reviews were always satisfactory and he received quarterly bonuses throughout the entirety of his employment. In addition, he received numerous awards, including model safety trucks, safety jackets, certificates and annual safety belt buckles. Also, he was a leader in his department, and was involved in a hiring committee, a safety committee, and a set run committee. Additionally, he rained drivers and was a mentor for approximately 12 drivers.

Fonseca was injured on the job when his semi-truck was rear-ended on June 19, 2017. He filed a workers’ compensation claim and his work restrictions varied from time to time, but for the most part they included no pushing, pulling and lifting over 5-10 pounds and no commercial driving. Fonseca claimed his doctors said that he should not be driving the 18-wheeler for 10-14 hours per day as was typical for his employment with Walmart. He also claimed that Walmart failed to accommodate each and every request for accommodations he made.

On January 31, 2018, Fonseca said he received a call from Walmart who said it .was informed that there was a report of fraud and questioned him for approximately 20 to 30 minutes. Walmart told him that they were informed that he was driving a vehicle and his restrictions provided that he could not drive. He informed Walmart that his restriction not to drive was as to commercial vehicles for commercial purposes, and did not understand those restrictions to include personal driving, especially because he drove to his doctor’s appointments and was not informed that he could not drive himself to his appointments. So he maintained that he did not do anything wrong.

On February 3, 2018, he claimed Walmart denied his last request for modified duty before he was terminated from employment.

His workers’ compensation claim continued without incident and he claims he did not receive any further information or communications from Walmart as to the alleged fraud until March 27, 2018, when Tisha Snyder allegedly called him and accused him of fraud and told him that his employment was going to be terminated because of gross misconduct and integrity. Snyder allegedly called him in the presence of a third party, his supervisor, Lou Lacroix.

The next day March 28, Fonseca allegedly attempted to discuss his termination with Walmart’s VP of transportation, Jeff Hammonds. However, Mr. Hammonds initially said he would get back to him by end of day, then he refused to speak with him since he was represented by workers’ compensation counsel. On March 29, 2018, while Fonseca was on lave for his work-related injuries, Walmart terminated his employment with the stated reason of gross misconduct and integrity.

His attorney claimed Walmart’s third-party workers’ compensation administrators investigated Fonseca, and videotaped him driving an RV, and determined no further action was warranted. Fonseca alleges that on November 18, 2018, he applied for two jobs and alleges he was allegedly “forced” to disclose he was fired for “gross misconduct and integrity” and as a result he was “not considered for either job.”

On July 7, 2019 he filed a First Amended Complaint in the United States District Court, Central District of California (case 5:19-cv-00821-JGB-KK which was later transferred to state court) and he alleged 11 causes of action, for Disability Discrimination, Failure to Accommodate, Failure to Engage in an Interactive Process, Retaliation under FEHA, Failure to Prevent Discrimination, Interference under CFRA, Retaliation under CFRA, Hostile Work Environment, Wrongful Termination in Violation of Public Policy; Intentional Infliction of Emotional Distress and Defamation.

The case ultimately proceed to a two phase trial in the San Bernardino Superior Court (CIVDS1909501). On November 19, 2024 the jury issued its Special Verdict for Defamation Per Quod (a legal term that describes a defamatory statement that requires additional evidence to prove its harmful effect on a plaintiff’s reputation). The Special Verdict found past economic losses of $522,323, future economic loss of $677,926, past non-economic loss of $3.5 million, Future non-economic loss of $5 million, (which totals $9.7M in actual damages) and additionally a phase II award of $25 million in punitive damages.

Lead attorney David M. deRubertis s reportedly said the evidence in the trial “showed that Walmart’s defamation of Jesse was part of a broader scheme to use false accusations to force injured truckers back to work prematurely or, if not, terminate them so that Walmart can cut down workers’ compensation costs,”

In a statement to Newsweek,Walmart spokesperson Kelly Hellbusch said, “This outrageous verdict simply does not reflect the straightforward and uncontested facts of this case. Accordingly, we will pursue all available remedies.”

The deRubertis Law Firm APC and Eldessouky Law APC represent Fonseca. Constangy Brooks Smith & Prophete LLP represents Wal-Mart.

The Oceanside Unified School District filed a lawsuit in U.S. District Court for the District of New Jersey against pharmaceutical and pharmacy benefit companies. The lawsuit alleges that three pharmaceutical manufacturers – Eli Lily, Novo Nordisk, and Sanofi – and three pharmacy benefit managers – Express Scripts, CVS Caremark, and Optum RX – colluded to inflate the price of insulin paid by the district’s self-funded health plan.

The lawsuit describes a scheme in which pharmacy benefit managers (PBMs) secure billions of dollars in rebates from pharmaceutical manufacturers in exchange for including their insulin products on the PBMs’ list of approved drugs, known as formularies. Manufacturers then artificially raise their prices to pay for those rebates, shadowing each other in lockstep rather than competing to offer lower consumer prices.

The lawsuit points out that insulin is a century-old medication, and while its production costs have decreased with little need for new investments in innovation, research, or development, its price has surged by more than 1000 percent since 2003. This dramatic increase is attributed to a pricing strategy involving pharmaceutical manufacturers and pharmacy benefit managers.

One of the attorneys representing the School District said in a press release that “like many organizations with self-funded health plans, the Oceanside Unified School District should not be forced to pay inflated and unreasonable insulin prices created by a scheme between big pharma and benefits managers to engage in unfair and deceptive trade practices.

This lawsuit aims to address these practices under state unfair business laws and federal Racketeer Influenced and Corrupt Organization (RICO) laws.”

According to the story published by NBCSandiego.com, Oceanside Unified School District is one of more than 200 school districts joining in the lawsuits nationwide. The attorney representing it says they’re anticipating more districts from San Diego County to come forward.

However, some employers with self-insured pharmacy benefits plans may become targets of litigation themselves. A study published by The American Journal of Managed Care last July conducted a national survey of 110 employer drug benefit decision makers for organizations with self-insured pharmacy benefits.

The study found that nearly two-thirds of employers reported having rebate agreements with a rebate guarantee for specialty drugs.The person or entity most influential to rebate strategy decisions was often a benefits consultant (37.3%), a human resources/benefits leader (29.1%), or a benefits broker (21.8%). Employers with rebate guarantees ascribed a higher level of importance to guarantees when selecting a PBM than employers receiving rebates without a guarantee and those who do not receive rebates.

The study concluded by saying “As the public discourse on PBMs and drug rebates continues, it is important to recognize the role employer benefits consultants may play in perpetuating employer reliance on guaranteed rebate arrangements.”

Responding to this study, the Mahoney Group warned “the reliance on drug rebate guarantees poses an elevated fiduciary risk for employers, especially in light of the Consolidated Appropriations Act (CAA) of 2021, which imposes tighter fiduciary duties on sponsors of group health plans.”

Large, self-insured employers are also beginning to face lawsuits from their workers over claims of mismanaging health and pharmaceutical benefits and violating their fiduciary duties under the Employee Retirement Income Security Act. Employees at Johnson & Johnson earlier this year filed a federal class-action lawsuit against their New Jersey-based employer alleging that over the years they have paid millions of dollars more for drugs than they should have. Wells Fargo was also sued by employees in a July class action for allegedly paying inflated prices to its contracted pharmacy benefits manager, Express Scripts.

In a statement to NBC 7, Eli Lily said, in part: “These allegations are baseless. It is the school district and other health plans – not Lilly – who negotiate the terms of their rebate arrangements, including whether to pass those rebates on to people who take insulin.”

CVS Caremark also responded, saying, in part, “Pharmaceutical companies alone are responsible for the prices they set in the marketplace for the products they manufacture … we intend to vigorously defend against this baseless suit.”