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Interactive Policy Year Stats Report – 2019 Now Online

The Workers’ Compensation Insurance Rating Bureau of California (WCIRB) has released the Interactive Policy Year Stats – 2019 Edition report that provides premium, exposure and loss information based on unit statistical report data submitted to the WCIRB for policy years 2003 to 2016.

The Interactive Policy Year Stats – 2019 Edition report offers a spreadsheet-based user interface, allowing users to browse loss, exposure and premium information and filter data by North American Industry Classification System (NAICS) sector, claim status and claim type. In addition to policy year information, some loss information by accident year is also included.

This new format was first introduced in 2018, replacing the WCIRB’s annual Summary of Policy Year Statistics report.

WCRI Reviews Non-Pharmacologic Services for Pain Management

Opioid dispensing to workers injured on the job has decreased substantially in recent years in all 27 state workers’ compensation systems studied, according to a WCRI report, Interstate Variations in Dispensing of Opioids, 5th Edition. Increases in non-opioid pain medications did not fully offset these decreases. As a result, the percentage of workers’ compensation claims with pain medication decreased in each of the 27 study states.

However, workers continued to receive treatment for their pain for the most part. The WCRI study suggests that providers have switched from multi-pronged pain treatments, which involve pain medications (including opioids) and other restorative therapies, to a treatment protocol that more frequently relies solely on non-pharmacologic services.

This change in treatment patterns conforms to the recommendations of opioid prescribing and pain treatment guidelines and policies implemented in a number of states, which call for broad adoption of alternatives to opioids for treating acute and chronic pain. While this switch occurred, in some states, there were small net increases in the percentage of claims that received neither pain medications nor non-pharmacologic treatment.

What are these non-pharmacologic pain management services and how frequently are they used?

— The most frequent services billed and paid under workers’ compensation were physical medicine evaluation, active and passive physical medicine, and passive manipulations. We found that the frequency of use of each of the non-pharmacologic pain management services varied across the 27 states..
— Physical medicine evaluations were conducted in the majority (more than 50 percent) of claims in 24 of 27 states. As part of an evaluation, the physical therapist may decide whether additional treatments are necessary. The provider may offer additional treatment, they may demonstrate some home exercises for the worker to do on their own, and they may recommend some self-care during that visit.
Active physical medicine was the most frequent form of treatment in all 27 states. The percentage of claims with active physical medicine ranged from a low of 50 percent in Massachusetts and 51 percent in Louisiana to a high of 67 percent in California and 68 percent in Nevada. Active physical medicine is exercises and movements performed by the worker.
Passive physical medicine modalities were the second most frequent treatment in 18 states, with the percentage of claims ranging from a low of 30 percent in Texas and 32 percent in Massachusetts to over 50 percent in California, Connecticut, Delaware, Maryland, and Nevada. Passive treatments, including the modalities covered here and passive manipulations covered below, are administered by the manual therapy provider to the affected area. They are used in the early stages of treatment when the patient is too injured or their condition is causing too much pain for them to do active exercises. Passive physical medicine modalities include electrical stimulation therapy and hot and cold therapy.
Passive manipulations were relatively frequent in the study states, ranging from 24 percent of claims in Arkansas to 58 percent in Nevada. Passive manipulations include manual therapy and massage. Chiropractic manipulations were used in 10 – 14 percent of claims in seven states, while they were rarely used in most other states.
Interventional pain management was the fourth most frequent pain treatment, ranging from 16 percent of claims in Maryland to 27 percent in Georgia. This category of pain treatment includes epidural procedures, facet and sacroiliac joint interventions, trigger point injections, and other injections and nerve blocks.
Fifteen percent of claims in California and 4 percent of claims in New York received acupuncture, but this treatment was rarely seen elsewhere. Behavioral evaluation and behavioral treatments were very infrequently used.

The data underlying these measures comprise over 222,000 nonsurgical workers’ compensation claims with more than seven days of lost time from 27 states.

DWC Orders Three Changes to OMFS

The Division of Workers’ Compensation has posted three new orders adjusting the Official Medical Fee Schedule (OMFS) to conform to changes in the Medicare payment system as required by Labor Code section 5307.1.

The Physician and Non-Physician Practitioner Fee Schedule update order adopts the following Medicare changes:

— CMS Medicare National Physician Fee Schedule Relative Value File RVU19D October 1, 2019 quarterly update
— National Correct Coding Initiative Practitioner Procedure to Procedure (PTP) Edits October 1, 2019 quarterly update
— National Correct Coding Initiative Medically Unlikely Edits October 1, 2019 quarterly update (excluding MUE “0” value codes)
— CMS ZIP Code to Carrier Locality files October 1, 2019 quarterly update, for Geographic Practice Cost Index (GPCI) locality mapping

The Hospital Outpatient Departments and Ambulatory Surgical Centers fee schedule update order adopts the following Centers for Medicare & Medicaid Services (CMS) Medicare changes:

— The CMS Medicare Hospital Outpatient Prospective Payment System (OPPS) October 2019 Addendum A quarterly update
— The CMS Medicare OPPS October 2019 Addendum B quarterly update
— The CMS Ambulatory Surgical Center Payment System, October 2019 ASC Approved HCPCS Code and Payment Rates, Column A entitled
— HCPCS Code” of “Oct 2019 ASC AA” and Column A entitled “HCPCS Code” of “Oct 2019 ASC EE”
— Certain sections of the CMS Medicare OPPS October 2019 Integrated Outpatient Code Editor (I/OCE), IOCE Quarterly Data Files V20.3 quarterly update
— CMS October 2019 Update of the Hospital Outpatient Prospective Payment System (OPPS), Change Request (CR) 11451 (August 30, 2019), Transmittal R4387CP

The pathology and clinical laboratory fee schedule update order adopts the following Medicare change:

— CY 2019 Q4 Release: Revised for October 2019 (19CLABQ4)

The orders adopting the OMFS adjustments is effective for services rendered on or after October 1, 2019 and can be found on the DWC website.

CVS Drug Pricing Plan Gains Little Traction

A CVS Health Corp health plan that uses an outside drug pricing group to help it decide whether to cover certain new medicines has gained little traction with customers, according to its top medical executive, and has drawn fierce criticism from patient advocacy groups.

The company has held back on marketing the pharmacy benefit plan while it talks to these groups, CVS said. The plan, launched a year ago, is based on analyses by the Institute for Clinical and Economic Review (ICER), a Boston-based group that assesses effectiveness of drugs to determine appropriate prices.

Using ICER’s cost effectiveness assessment, CVS decides whether to include second or third medicines entering the market if there are already similar ones in the plan.

Opposition to the CVS plan is part of much broader concerns cited by drug companies and advocacy groups, many of which receive funding from the pharmaceutical industry. Some say that ICER’s analysis based on additional years of “quality life” gained from a given treatment is arbitrary and disregards the costs of drug development and patient needs.

More than 50 groups, including drugmakers, PhRMA, the industry’s main lobby group, and other advocacy groups, have provided comment during a public input period included in a review by ICER of its assessment methods. Many asked ICER to eliminate price recommendations from its efficacy analyses.

ICER has defended its methods, which are based on a widely-used cost effectiveness analysis.

The soft rollout of CVS’ ICER-related product comes as employer health plan sponsors – its biggest clients – are showing increased concern over their cost for new high-priced drugs, and are considering refusing to pay for them at all, CVS Chief Medical Officer Troy Brennan said in a recent interview.

If corporate customers follow through on that threat, CVS said it could change tactics with the plan.

Earlier this year, Novartis AG launched Zolgensma, a more than $2 million gene therapy for a rare but deadly disease called spinal muscular atrophy.

The new CVS program, cited as an example of ICER’s growing influence on U.S. drug pricing, would not apply to such a breakthrough treatment. It is a tiny plan by CVS standards as the company manages pharmaceutical benefits for more than 102 million people and also owns Aetna insurance and a national pharmacy chain.

The plan’s scope is limited to so-called me too drugs, those where similar effective treatments already exist, and aims to pressure drugmakers to set lower prices. For example, two of three very similar drugs for migraine approved in 2018 could have been excluded, but drugmakers set prices ICER deemed cost effective.

Large healthcare consultant and brokerage Mercer said it has begun to field similar concerns.

NCCI Reviews Air and Ground Ambulance Fees

The cost of ambulance services has risen in recent years – a single trip can exceed $45,000 for an air ambulance service and $1,400 for a ground ambulance service. Medical transportation in workers compensation (WC), however, can take many different forms. These include air ambulances, emergency and nonemergency ground ambulances, nonemergency transportation to and from medical appointments, mileage reimbursement for instances where the injured worker can drive themselves, and other ancillary transportation-related services.

Recently, air ambulance services and their associated costs have garnered attention. The US Congress, the National Association of Insurance Commissioners, and several state governments and related stakeholders have explored issues surrounding the cost of air ambulance services. In response, several states, as well as the US Congress, have introduced legislation aimed at addressing these concerns.

In the WC arena, much of the discussion has centered around a state’s ability to regulate air ambulance reimbursement rates. Some states have fee schedules that encompass air ambulance services, which are intended to regulate WC maximum allowable reimbursements (MARs). However, the federal Airline Deregulation Act of 1978 (ADA) expressly preempts state law “related to price, route, or service of an air carrier.” The question of which law governs fee schedule limitations on air ambulance reimbursement has led to legal challenges in several states. So far, state and federal courts have largely found that the ADA preempts state WC laws and regulations limiting air ambulance reimbursements.

Ambulance services include both ground ambulance and air ambulance. Before looking at the cost of these services, it is important to discuss how reimbursement for these services is determined. Typically, reimbursement consists of two components: a base payment and a mileage payment. The base payment rate reflects the level of service intensity and varies based on whether the transport:

— Is emergency or nonemergency
— Requires basic life-support staff (BLS) or advanced life-support (ALS) staff
— Is ground or air transport

The mileage payment rate reflects the cost of using the ambulance, including fuel and maintenance. While ground ambulance transports are utilized at a much higher rate than air ambulance transports, the cost per episode for ground transports is significantly lower. The frequency and cost per episode vary for each type of ground (emergency and nonemergency) and air ambulance (fixed- or rotary-wing) transport.

Air ambulances can be broken down into two categories: fixed wing (e.g., an airplane) and rotary wing (e.g., a helicopter). Rotary-wing ambulances can be used in place of ground ambulances in emergencies where the injured worker needs to be transported a short distance quickly. Another important characteristic of a rotary-wing ambulance is its ability to land in a variety of locations, including locations that could be difficult for a ground ambulance to reach. On the other hand, fixed-wing transports are typically utilized for longer distance travel.

Historically, rotary-wing episodes have been more prevalent than fixed-wing episodes; rotary-wing episodes accounted for approximately 85% of both payments and episodes for air ambulance services from 2013 to 2017. Chart 4 displays the average payment per episode for fixed-wing and rotary-wing episodes for the base and mileage components.

The average payment per episode increased for both fixed-wing and rotary-wing episodes since 2013. The average base payment is higher for rotary-wing episodes compared with fixed-wing episodes. In contrast, the average

The average payment per episode for an air ambulance is, however, costly, exceeding $20,000 in recent years. Payments for ambulance services, including ground and air, account for more than 75% of total medical transportation costs, and the average payment per episode for ambulances, both ground and air, has increased since 2013.

Filing Comp Claim Not Necessarily a FEHA “Protected Activity”

Nicole Riley worked in the El Dorado County Psychiatric Health Facility (PHF) where she expressed concerns about safety. These concerns related to changes to work schedules that resulted in fewer staff at times and construction modifications to the layout of the PHF that eliminated a hallway providing visual access to the community room before entering it..

After she was injured by a patient and filed a workers’ compensation claim, she took a higher paying job with the Office of the Public Guardian because she felt unsafe at the PHF.

Less than two months into the one-year probationary period for her new job, she was terminated for failure to complete probation satisfactorily. Riley sued the County for wrongful termination on a number of theories, including retaliation under the Fair Employment and Housing Act She alleged the proffered reason for her dismissal was pretextual.

She alleged “the real reason she was fired from the Public Guardian’s Office was to retaliate against her for her complaints about safety concerns” and the firing “constituted unlawful discrimination for her association with and advocacy for mental health and disabled patients and was retaliation for filing her worker’s compensation claim.

The trial court granted the County’s motion for summary judgment. On appeal from the judgment in favor of the County, Riley contends the trial court erred in finding her claims were not covered by FEHA. She asserts that her advocating for mentally disabled patients and her filing of a workers’ compensation claim were protected activities and she had associational status due to her advocacy for a protected class.

The court of appeal affirmed the dismissal in the unpublished case of Riley v County of El Dorado.

In order to establish a prima facie case of retaliation under the FEHA, a plaintiff must show (1) he or she engaged in a ‘protected activity,’ (2) the employer subjected the employee to an adverse employment action, and (3) a causal link existed between the protected activity and the employer’s action.

Once an employee establishes a prima facie case, the employer is required to offer a legitimate, nonretaliatory reason for the adverse employment action. If the employer produces a legitimate reason for the adverse employment action, the presumption of retaliation “drops out of the picture,” and the burden shifts back to the employee to prove intentional retaliation.

In finding Riley’s complaints regarding safety were not a protected activity, the trial court relied in part on Dinslage v. City and County of San Francisco (2016) 5 Cal.App.5th 368. Complaints about workplace safety are not a protected activity that will support a FEHA retaliation claim.

With respect to the workers’ compensation claim, the determination as to what constitutes a protected activity is inherently fact driven.

Here, the filing of the workers’ compensation claim was completely unrelated to any discriminatory employment practice. Riley did not file for stress injuries caused by discriminatory harassment. Rather, she sought–and received–treatment in the form of physical therapy, chiropractic, and acupuncture services, for her physical injuries of bumps, bruises, and neck and shoulder injuries caused by an assault in the workplace. In this circumstance, the filing of a workers’ compensation claim is not a protected activity.

Another Opiod Case Settles Before Trial

Reuters reports that Johnson & Johnson will pay $20.4 million to settle claims by two Ohio counties, allowing the U.S. healthcare giant to avoid an upcoming federal trial seeking to hold the industry responsible for the nation’s opioid epidemic.

J&J became the fourth drugmaker to settle claims ahead of the Federal Court trial against multiple manufacturers and distributors in Cleveland scheduled for later this month. The case is considered a bellwether for more than 2,600 lawsuits by state and local governments that are pending nationally.

“The settlement allows the company to avoid the resource demands and uncertainty of a trial as it continues to seek meaningful progress in addressing the nation’s opioid crisis,” J&J said in a statement.  “The company recognizes the opioid crisis is a complex public health challenge and is working collaboratively to help communities and people in need,” it added.

J&J which formerly marketed the painkillers Duragesic and Nucynta, said the settlement includes no admission of liability.

The company will pay $10 million to Cuyahoga and Summit counties, reimburse $5 million of their legal and other expenses and provide $5.4 million to non-profit organizations that run opioid-related programs in the counties.

Mallinckrodt Plc finalized a $24 million settlement with the same two counties on Monday. Endo International Plc and Allergan Plc also settled with the two counties in August to avoid going to trial.

The remaining defendants in the Oct. 21 federal trial include McKesson Corp, AmerisourceBergen, Cardinal Health, Teva Pharmaceutical Industries Ltd, Walgreens Boots Alliance Inc and Henry Schein Inc.

OxyContin maker Purdue Pharma LP succumbed to pressure from the lawsuits and filed for bankruptcy protection in September.

Earlier in the year, an Oklahoma judge ordered Johnson & Johnson to pay $572.1 million to the state for its part in fueling an opioid epidemic by deceptively marketing addictive painkillers.

Purdue Pharma and Teva had settled claims by Oklahoma’s attorney general for $270 million and $85 million, respectively.

Another Opioid Case Settles Before Trial

Reuters reports that Johnson & Johnson will pay $20.4 million to settle claims by two Ohio counties, allowing the U.S. healthcare giant to avoid an upcoming federal trial seeking to hold the industry responsible for the nation’s opioid epidemic.

J&J became the fourth drugmaker to settle claims ahead of the Federal Court trial against multiple manufacturers and distributors in Cleveland scheduled for later this month. The case is considered a bellwether for more than 2,600 lawsuits by state and local governments that are pending nationally.

“The settlement allows the company to avoid the resource demands and uncertainty of a trial as it continues to seek meaningful progress in addressing the nation’s opioid crisis,” J&J said in a statement.  “The company recognizes the opioid crisis is a complex public health challenge and is working collaboratively to help communities and people in need,” it added.

J&J which formerly marketed the painkillers Duragesic and Nucynta, said the settlement includes no admission of liability.

The company will pay $10 million to Cuyahoga and Summit counties, reimburse $5 million of their legal and other expenses and provide $5.4 million to non-profit organizations that run opioid-related programs in the counties.

Mallinckrodt Plc finalized a $24 million settlement with the same two counties on Monday. Endo International Plc and Allergan Plc also settled with the two counties in August to avoid going to trial.

The remaining defendants in the Oct. 21 federal trial include McKesson Corp, AmerisourceBergen, Cardinal Health, Teva Pharmaceutical Industries Ltd, Walgreens Boots Alliance Inc and Henry Schein Inc.

OxyContin maker Purdue Pharma LP succumbed to pressure from the lawsuits and filed for bankruptcy protection in September.

Earlier in the year, an Oklahoma judge ordered Johnson & Johnson to pay $572.1 million to the state for its part in fueling an opioid epidemic by deceptively marketing addictive painkillers.

Purdue Pharma and Teva had settled claims by Oklahoma’s attorney general for $270 million and $85 million, respectively.

September 30, 2019 News Podcast


Rene Thomas Folse, JD, Ph.D. is the host for this edition which reports on the following news stories: Unsigned Policy Limiting Endorsement was “Equitable”, Aliso Viejo Drugmaker Resolves Kickback Claim for $116M, Cardiologist with 25 Year History of Crime – Charged Again, Stolen DEA Numbers Used to Buy Opiates for Darknet, Genetic Testing “Next Big Frontier” in Healthcare Fraud, Adjuster with Multiple Revoked Licenses – Sent to Jail, New Opioid Controls for Injured Federal Workers, DWC Amends DMEPOS Section of Fee Schedule, CIRB Publishes 2020 Plans and Manual, Research Now Shows AI Equal to Human Medical Experts.

Newsom Signs First Responder PTSD Presumption Law

Gov. Gavin Newsom signed Senate Bill 542. The new law creates a rebuttable presumption that a first responders PTSD struggles are an occupational injury, The new law would apply to injuries occurring on or after January 1, 2020.

The rebuttable presumptions for first responder work-related injuries already included physical ailments such as heart disease, cancer and hernias.

Before Newsom signed SB 542, California’s law limited psychiatric injury compensation to those that could prove the injury was at least 50 percent related to their job.

Section 3212.15 is added to the Labor Code. Under these new provisions, in the case of certain state and local firefighting personnel and peace officers, the term “injury” also includes post-traumatic stress that develops or manifests itself during a period in which the injured person is in the service of the department or unit.  And the law would prohibit compensation from being paid for a claim of injury unless the member has performed services for the department or unit for at least 6 months, unless the injury is caused by a sudden and extraordinary employment condition. The six months of employment need not be continuous.

The injury so developing or manifesting itself in these cases shall be presumed to arise out of and in the course of the employment. This presumption is disputable and may be controverted by other evidence.

This presumption shall be extended to a member following termination of service for a period of 3 calendar months for each full year of the requisite service, but not to exceed 60 months in any circumstance, commencing with the last date actually worked in the specified capacity.

Newsom signed the law alongside two other bills that will provide mental health support to firefighters and peace officers. The second new law establishes standards for peer support programs. The third signing prohibits the outsourcing of local emergency dispatch services to for-profit agencies.

AB 1116, the California Firefighter Peer Support and Crisis Referral Services Act by Assemblymember Tim Grayson (D-Concord), establishes statewide standards for first responder peer support programs to provide an agency-wide network of peer representatives available to aid fellow employees on emotional or professional issues.

SB 438 by Senator Robert Hertzberg (D-Van Nuys) will prohibit a public agency from outsourcing its local emergency dispatch services to a private, for-profit entity – except when pursuant to a joint powers or cooperative agreement. It also clarifies that a public safety agency maintains the authority to determine the appropriate deployment of emergency resources within the agency’s jurisdiction in order to provide the highest and best level of emergency response for the community it serves.