The U.S. Supreme Court unanimously overturned a Washington state workers’ compensation law designed for federal contractors working at a nuclear waste site

The state of Washington enacted a workers’ compensation law that applied only to certain workers at a federal facility in the state who were “engaged in the performance of work, either directly or indirectly, for the United States.” The facility, known as the Hanford site, was once used by the Federal Government to develop and produce nuclear weapons, and is now undergoing a complex decontamination process.

Most workers involved in this cleanup process are federal contract workers – people employed by private companies under contract with the Federal Government. A smaller number of workers involved in the cleanup include State employees, private employees, and federal employees who work directly for the Federal Government.

The Washington state law makes it easier for federal contract workers at Hanford to establish their entitlement to workers’ compensation, thus increasing workers’ compensation costs for the Federal Government.

The United States brought suit against Washington, arguing that Washington’s law violates the Supremacy Clause by discriminating against the Federal Government. The United States asserts that a ruling in its favor will allow it to recoup or to avoid paying millions of dollars in workers’ compensation claims.

The District Court concluded that the law was constitutional because it fell within the scope of a federal waiver of immunity contained in 40 U. S. C. §3172. The Ninth Circuit Court of Appeals affirmed.

In a unanimous 9-0 opinion, the Supreme Court of the United States reversed in the case of United States v Washington, 21-404 (June 2022).

Washington argues that Congress has waived federal immunity from state workers’ compensation laws on federal lands and projects through §3172(a). Section 3172(a) says that “[t]he state authority charged with enforcing and requiring compliance with the state workers’ compensation laws . . . may apply [those] laws to all land and premises in the State which the Federal Government owns,” as well as “to all projects, buildings, constructions, improvements, and property in the State and belonging to the Government, in the same way and to the same extent as if the premises were under the exclusive jurisdiction of the State.”

The U.S. Supreme Court has interpreted the Supremacy Clause of the Constitution as prohibiting States from interfering with or controlling the operations of the Federal Government. This constitutional doctrine – often called the intergovernmental immunity doctrine – has evolved to bar state laws that either regulate the United States directly or discriminate against the Federal Government or its contractors.

It said that “Washington’s law violates these principles by singling out the Federal Government for unfavorable treatment. The law explicitly treats federal workers differently than state or private workers, and imposes costs upon the Federal Government that state and private entities donot bear. The law thus violates the Supremacy Clause unless Congress has consented to such regulation through waiver.”

The Supreme Court concluded that “the statute thus does not clearly and unambiguously permit the discrimination contained in Washington’s ‘federal workers only’ law” and thus its argument was “unconvincing.”

Dr. Gary Royce Wisner was a board certified orthopedic surgeon practicing as Orthopedics Sports & Workers’ Medical Group, Inc,. at 621 S. Ham Ln. Suite A. in Lodi, California.

He was licensed to practice medicine in California, Alabama, and Nevada. He claims to be affiliated with Adventist Health Lodi Memorial, St. Joseph’s Medical Center, and Dameron Hospital. He is a graduate of Universidad Autonoma de Guadalajara Medical School.

In November 2016, representatives from the California Department of Justice, Division of Medi-Cal Fraud and Elder Abuse (DMFEA) were notified by multiple government offices of suspected fraud by Wisner in overbilling the Medi-Cal and Medicare programs.

DMFEA’s investigation into Wisner’s alleged misconduct revealed Wisner would administer X-rays even in routine office visits and would X-ray multiple parts of a patient’s body – regardless of whether it had any relation to a patient’s medical condition.

On May 30, 2018, a grand jury indicted him on 11 felony counts of insurance fraud. for bilking insurers out of more than $700,000 for allegedly providing unnecessary and excessive medical treatment for orthopedic patients. A criminal complaint was filed on July 9, 2018 following the indictment.

On July 23, 2018 the Attorney General filed a 31 page accusation before the Medical Board of California seeking a revocation of his license. The Accusation alleged “gross negligence” in a separate cause for each of eight of his patients. Three of them were being treated for “work related” injuries. The Accusation in essence claimed that he committed gross negligence in his care and treatment when he obtained excessive, non-medically necessary and repeated x-rays of remote areas unrelated to the place of injury.

The Accusation to revoke his license is still pending, and Wisner is still licensed to practice medicine in California.

But the California Attorney General just announced securing a guilty verdict following a two-week jury trial in Sacramento County Superior Court, Wisner was convicted on Thursday, June 16th, of 10 felony counts of health care insurance fraud.

Evidence presented at trial showed that over the course of an approximate four-year period, Wisner subjected ten individual patients to hundreds of unnecessary X-rays at his clinic.

The Attorney Genera’s announcement reports that Wisner is also the subject of an independent criminal complaint filed by the San Joaquin County District Attorney’s Office for worker’s compensation fraud. The case is still pending and Gary Wisner is presumed innocent until proven guilty of those charges.

This investigation was made possible through collaboration with the United States Department of Health and Human Services (HHS), the San Joaquin County District Attorney’s Office, and the California Department of Insurance.

The California Department of Justice’s DMFEA protects Californians by investigating and prosecuting those who defraud the Medi-Cal program as well as those who commit elder abuse. These settlements are made possible only through the coordination and collaboration of governmental agencies, as well as the critical help from whistleblowers who report incidences of abuse or Medi-Cal fraud at oag.ca.gov/dmfea/reporting.

DMFEA receives 75% of its funding from HHS under a grant award totaling $50,522,020 for federal fiscal year 2021-2022. The remaining 25% is funded by the State of California. The federal fiscal year is defined as October 1, 2021, through September 30, 2022.

According to the report published by RXInformer, over 50% of U.S. physicians are over the age of 50 and one third will be over the age of 65 in the next decade.Thirty percent of physicians retire between the ages of 60 and 65, and more are leaving the profession before retirement age due to job dissatisfaction and burnout. A limited number of residency programs, combined with fewer young people aspiring to careers in medicine, has restricted the number of new physicians. All of which means that physicians are leaving the profession faster than they can be replaced.

The Association of American Medical Colleges projects a shortage of 47,000 – 122,000 physicians by 2032, with family and internal medicine, emergency medicine, hospitalists, and radiologists all falling within the top 10 specialties experiencing shortages. Urgent care, cardiology, orthopedic surgery, neurology, general surgery, and anesthesiology are all included within the top 20.

And the healthcare industry has been directly affected by supply chain disruptions for a large variety of products, as well as experiencing an exacerbation of the already serious shortage of healthcare professionals, making some services equally hard to come by.

The ripple effect of supply chain disruptions, along with ongoing price inflation, can make it challenging to keep up with the fluctuating scarcity and costs of healthcare goods and services, but some notable deficiencies that affect workers’ compensation healthcare include:

Oxygen: COVID-19 has caused a very high demand for oxygen, which many people who suffer from other chronic respitory ailments had already depended on. While oxygen itself is not in short supply, providing the specialized containers, vehicles, and drivers required to safely transport liquid oxygen has been a challenge. Nearly three quarters of suppliers have reported delays for this equipment and 67% reported increased costs, which causes hardship for patients who rely on supplemental oxygen and cannot get refills for home use as quickly and easily as they need.

Basic Medical Supplies: U.S. companies that sell medical supplies such as gloves, cotton swabs, gauze, and other essentials, have long relied on overseas manufacturers to produce their products. When the pandemic hit, many governments required their manufacturers to supply their own countries before servicing overseas customers, which has caused a fluctuating chain of shortage and high prices.

Walking Aids: A long list of durable medical equipment (DME) in short supply includes an acute shortage of crutches, canes, walkers, wheelchairs, and braces These products are manufactured with aluminum, one of a number of raw materials in great demand, leaving some hospitals and care facilities to request donations of unused equipment from their communities. Shortages of these supplies also hampers progress in physical therapy by delaying patients’ transition from wheelchair to walker to cane, etc.

Medical Monitors: Largely due to the backlog of computer chip orders, monitoring devices for blood pressure, insulin, and other vital information are taking longer to procure and costing more. A recent survey of medical technology companies found that 100% had experienced disruptions to their semiconductor chip supply chains and that 50% of the products they produce rely on such chips.

Diagnostic Equipment: Ultrasound machines, CT scanning devices, and imaging machines also require seminconductor chips. The competitition for chips is fierce because they are also used in a mutlitude of consumer items from automobiles to video game consoles. When orders of new equipment are delayed for medical providers and there is a shortage of healthcare professionals available, patients have to wait longer for diagnostic tests, which can in turn, delay appropriate treatment.

Home Health Professionals: The heavy responsibilities and light wages that are typical for home health aides have made good help hard to find for some time. Making it worse, many home health workers left their jobs due to illness or fear of contracting illness, burnout, or the need to care for children or other relatives at home. The shortage of home health aides has continued and is causing a gap between requests for home health services and the ability of agencies to meet those requests. The problem is not expected to get better anytime soon with home health aides projected as the occupation that will have the most demand for workers over the next decade.

A number of solutions should be considered by claims professionals. For example, monitoring, measuring, and comparing network provider performance is a good way to fully optimize managed care. Capturing and analyzing relevant data such as referral acceptance, turnaround times, formulary adherence, etc. is more important than ever to ensure that quality standards are met at the lowest cost possible. Comparing metrics between vendors not only informs current management strategy, but can assist in anticipating future industry trends.

A January 26, 2020, helicopter crash in Calabasas, California resulted in the deaths of Kobe Bryant; his minor daughter, six other passengers, and the pilot.

One of the passengers was Christina Mauser, who was in the course and scope of her employment as a basketball coach for Sports Academy, LLC, insured for workers’ compensation benefits by The Hartford Accident & Indemnity Company. Hartford paid funeral and burial costs, and death benefits.

The Mauser Plaintiffs filed their Complaint for Damages with the Superior Court of California against various parties they alleged were responsible for the incident.. When the United States was named as a defendant in the action, it removed the case to the Federal Central District of California on September 30, 2020. Motions to remand to state court were denied.

On July 9, 2021, Hartford filed its Intervention Motion in the federal case after tentative settlements had been reached in the case. On July 22, 2021, the United States Government filed its Opposition to Hartford’s Intervention Motion on the basis that it did not present an administrative claim against it and there was no jurisdiction. No other parties opposed the Intervention Motion.

On November 10, 2021, the federal court issued its Orders granting the Mauser Plaintiffs’ Petitions for Minors’ Compromise and denying Hartfords July 9 Intervention Motion.

An appeal of the denial was filed in the 9th Circuit Court of Appeals. On June 14, 2022 Hartford filed it’s Motion to Voluntarily Dismiss the Appeal.

On appeal, Hartford had argued that error was made in the original denial of Hartford’s Motion “because the Court based its determination that the Intervention Motion was untimely on federal procedural law, instead of substantive state law. California Labor Code § 3853 specifically provides that a motion to intervene pursuant to California Labor Code § 3850, et seq. is timely if it is filed at any time before trial on the facts.”

In denying the Motion to Intervene, the trial court found that intervention is not appropriate, either as of right or permissively.

With respect to intervention as of right, a court must permit any party to intervene in a lawsuit who “claims an interest relating to the property or transaction that is the subject of the action.Fed. R. Civ. P. 24(a)(2). Rule 24(a)2 is broadly construed in favor of intervention. The Ninth Circuit employs four criteria to determine whether intervention under Rule 24(a) is appropriate: (1) the motion to intervene must be timely; (2) the applicant must have a significantly protectable interest related to the property or transaction that is the subject of the action; (3) the applicant must be situated such that the disposition of the action may impair or impede the applicant’s ability to protect that interest; and (4) the applicant’s interest must not be adequately represented by the existing parties.

Sports Academy and Hartford acknowledge, the Mauser plaintiffs initially filed their complaint on April 20, 2020, and their action was removed to federal court on September 30, 2020. Sports Academy and Hartford do not explain why they waited until over a year after Mauser plaintiffs filed their action – and more than nine months after it was removed to federal court – before filing the instant Motion. Thus, the court found that the Motion was untimely.

Having failed to satisfy at least two of the requirements for intervention pursuant to Rule 24(a), the court was not persuaded that Sports Academy and Hartford have met their burden for intervention as of right.

With respect to permissive intervention under Rule 24(b), a court may grant permissive intervention where: (1) the applicant shows independent grounds for jurisdiction; (2) the motion is timely; and (3) the applicant’s claim or defense and the main action share a common question of law of fact. In exercising its discretion on an application for permissive intervention, the court “must consider whether the intervention will unduly delay or prejudice the adjudication of the original parties’ rights. Because the court finds this unexplained delay renders the Motion untimely and risks delaying or prejudicing the adjudication of the original parties’ rights, the court declines Sports Academy and Hartford’s request for permissive intervention.