Misdemeanor price gouging charges have been filed by the California Attorney General against Katrin Golian, doing business as RxAll Pharmacy, an independently-owned business located at 1125 South Beverly Drive, Suite 100, Los Angeles, California.

On March 4, 2020, Governor Gavin Newsom declared a state of emergency in response to the COVID-19 pandemic, which triggered price gouging prohibitions statewide. The Governor later issued Executive Order N-44-20, which prohibits businesses that did not sell certain emergency-related items prior to the emergency declaration from charging a price for the items that is greater than 50 percent more than the seller’s cost of purchase.

The criminal complaint alleges that Ms. Golian, a licensed pharmacist, knowingly sold KN95 masks at prices exceeding the 50 percent mark-up permitted under the executive order. This is the first time that charges have been filed under Governor Newsom’s executive order on price gouging.

Following a consumer complaint against RxAll Pharmacy, an investigation conducted by the California Department of Justice revealed that Ms. Golian had been purchasing individual masks for $5 each and selling them at $10 each – 100 percent more than her cost for the masks – despite the Governor’s executive order.

After being warned by special agents that the price of the masks violated the Governor’s executive order, Ms. Golian acknowledged the warning and agreed to reduce the price on masks.

Several days later, special agents returned to RxAll Pharmacy and found that Ms. Golian was still selling masks at the same price she had previously been told violated the order. Ms. Golian sold undercover agents two masks at the unlawful price of $10 each.

Under California law it is unlawful to refuse or willfully neglect to obey any lawful order issued under the Emergency Services Act. Violation of this section is punishable as a misdemeanor, including imprisonment in county jail for not more than six months and/or a fine of not more than $1,000. This offense has a one-year statute of limitations.

The California Insurance Commissioner issued an Order adopting emergency workers’ compensation regulations in response to the COVID-19 pandemic.

These new regulations will mandate insurance companies to recompute premium charges for policyholders to reflect reduced risk of loss consistent with Commissioner Lara’s April 13 and May 15, 2020 Bulletins, and will result in savings for many policyholders as businesses continue to struggle financially during the COVID-19 pandemic.

The new regulations will go into effect on July 1, 2020.

Under these emergency regulations, employers are permitted to reclassify an employee if the employee’s duties have changed to a clerical classification that has reduced risk than the employee’s previous classification.

This reclassification will reduce the employer’s premiums for employees who are a lower risk because they are now working from home even though they may not have previously done so. This change would be retroactive to March 19, 2020, the first day of the Governor’s statewide stay-at-home order, and conclude 60 days after the order is lifted.

These emergency regulations also exclude from premium calculations the payments made to an employee, including sick or family leave, while the employee is not performing duties of any kind for the employer. Typically, these payments would be used as a basis for the employer’s workers’ compensation premium. This change will lower the employer’s rate by reducing the amount of payroll assessed, and the employer will not pay premium for paid workers who are otherwise being furloughed.

This new regulation will also exclude claims related to a COVID-19 diagnosis from being included in future rate calculations so that employers are not penalized with higher rates due to COVID-19 claims.

Insurers will also be required to report injuries involving a diagnosis of COVID-19 which will allow the Commissioner’s statistical agent – the WCIRB – to keep track of COVID-19 injuries, and will aid in the WCIRB’s future analyses of the workplace and market impacts.

San Francisco’s District Attorney has joined a growing chorus of California regulators and enforcement officials taking aim at gig economy companies for what they see as the misclassification of workers as contractors.

The chief prosecutor announced the filing of an employee protection action against DoorDash alleging the company has and continues to illegally misclassify its delivery workers as independent contractors when, in fact, they are employees. The action seeks restitution for workers, an injunction requiring DoorDash to properly classify its delivery workers as employees, and civil penalties.

DoorDash is a business that delivers food, beverages and other items from local restaurants and stores to nearby customers. It refers to its delivery workers as “Dashers” and employs them to pick up orders from merchants and deliver them to customers. DoorDash is headquartered in San Francisco.

According to the complaint, misclassification is a major issue negatively impacting California workers. The California Supreme Court has discussed that misclassification is a “very serious problem” that was depriving “millions of workers of the labor law protections to which they are entitled.”

The California Legislature has stated that misclassification contributes to the rise in income inequality and the shrinking of the middle class.

Additionally, the San Francisco Board of Supervisors recently adopted a Resolution urging “City Attorney Dennis Herrera and District Attorney Chesa Boudin to seek immediate injunctive relief to prevent the misclassification of San Francisco workers as they seek to access basic workplace rights like paid sick leave, unemployment insurance, and benefits provided under the San Francisco Health Care Security Ordinance.”

Under California’s protective labor laws, workers are presumed to be employees and it is the employer’s burden to justify classifying workers as independent contractors.

The District Attorney also claims that “properly classifying employees is especially important during the ongoing COVID-19 pandemic. Dashers were already performing dangerous work, forced to navigate traffic conditions as quickly as possible to make their deliveries or risk being suspended or terminated by DoorDash. The job of a Dasher became substantially more perilous during this pandemic. Dashers have been deemed essential workers yet DoorDash does not even provide them with workers’ compensation insurance and prevents them from having access to paid sick and disability leave under state laws.”

Strong responses to the opioid epidemic have led to decreased opioid use over the past five years. However, has the decline been consistent across industries?

A new article published by the National Council on Compensation Insurance (NCCI) explores the difference in opioid use between industry groups by looking at data-driven trends underlying opioid prescribing patterns in workers compensation – with a special focus on the contracting industry.

Studies have shown that certain industry groups have been more prone to opioid use and abuse than others. Further, NCCI data shows that the treatment of injured workers in certain industry groups is significantly more likely to include opioids. For example, in the contracting industry, the quantity of opioids prescribed to injured workers is more than double the average number prescribed to those in all other industry groups.

The share of claims receiving an opioid is greater for the contracting industry group (20%) when compared with all other industry groups combined (14%).

This means that, on average, one out of every five contracting claims involves at least one opioid prescription. In addition, these contracting industry group claimants, on average, receive both 20% more opioid prescriptions and opioid prescriptions that are 20% stronger.

One factor contributing to the higher opioid usage in the contracting industry group is the greater likelihood for serious injuries to occur. Higher medical costs are typically associated with more serious injuries-claims that may be more likely to require pain management efforts, including the potential use of opioids.

For accidents occurring in 2017, the average medical cost per claim, including prescription costs, in the contracting industry group was approximately 2.3 times greater than that for all other industry groups combined.

Opioid usage has experienced decreases in recent years, including among the contracting industry. Between 2012 and 2017, overall, per-claim opioid usage fell by 49% in the contracting industry group.

Decreased opioid usage in the contracting industry group can be primarily explained by a combination of two factors: fewer claimants receiving an opioid prescription, and a reduced number of opioid prescriptions for those who do receive them.

Analysts predict the Global Insurance Fraud Detections market to show a compound annual growth rate of 21.66% from 3.7 billion in 2019 to reach 12 billion by 2026.

The major factors contributing to the growth of the market are the need to manage huge volumes of identities by organizations productively, increasing operational efficiency and improving the customer experience, growing adoption of advanced analytics techniques, and stringent regulatory compliance requirements.

The global Insurance Fraud Detection Market is bifurcated into Fraud Analytics, Authentications, Governance Risk and Compliance, and others.

Fraud analytics is expected to constitute the largest market share. Such systems track and analyze data from multiple data sources, identify anomalies and suspicious and irregular activity across all channels, and provide real-time control mechanisms to prevent fraudulent practices. Hence, leading to the growth of the segment.

The emergence of advanced solutions such as the use of automated business rules, self-learning models, text mining, image screening, network analysis, predictive analytics, and device identification is estimated to deliver actionable insights to advance claims processes.

As a result, insurance organizations are adopting fraud detection solutions that not only recognize the genuine claims process but also decrease the number of false positives.

Various factors, such as a rise in the sophistication level of cyber-attacks and enormous monetary losses due to these attacks in the insurance sector, are anticipated to drive the market. An increase in the generation of enterprise data and its intricacy, high industry-specific requirements, and an increase in the incidence of fraud further supplement the fraud detection market growth.

With the growing awareness of criminals and sophisticated crimes, fraud prevention and detection capabilities are increasing. Global concerns about the constantly increasing cases of insurance fraud, coupled with sophisticated organized crime, have signaled the need for all insurance companies to act consistently.

Different factors, such as an exponential rise in cyber-attack sophistication and substantial monetary losses due to these assaults in the insurance sector, are expected to drive the market.