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Azusa Massage Parlors Cited for No Comp Insurance

Acting on complaints from residents, police carried out compliance checks at six Azusa massage parlors issuing several citations but making no arrests, officials said. The San Gabriel Valley Tribune reports that police joined with officials from Azusa code enforcement, the California Employment Development Department, the California Department of Industrial Relations, and the Los Angeles County Sheriff’s Department’s Major Crimes Bureau’s licensing unit during the operation, Azusa police Lt. Mike Bertelsen said in a written statement.

“Azusa PD has received complaints that some massage parlors within the city may be offering sexual services to customers in addition to massages,” Bertelsen said. “After learning of the complaints, Azusa PD detectives solicited the help of outside agencies with specific expertise in massage parlor operations to develop and execute this administrative compliance detail.” In addition to verifying that all local, county and state laws and regulations were being followed, police said officials were also seeking to determine whether any victims of human trafficking were associated with any of the massage parlors.

“No victims of human trafficking were located, however numerous citations were issued for violations of various Azusa municipal codes, along with workers compensation insurance or minimum wage violations,” Bertelsen said. “Some of the businesses involved face fines of several thousand dollars each. These investigations are ongoing, so none of the businesses are being identified.” Bertelsen said similar “administrative inspections” are likely to be held again in the future.

Only Two Comments Posted to DWC ICD-10 Forum

We are anticipating the DWC announced transition to ICD-10 at the end of this year. The DWC had public comment on the 16 pages of proposed new regulations from March 18, through March 28, 2014 and the comment period is now closed. Only one half page of comments were received.  Most of the half page consisted of questions by one poster rather than comments, and the only substantive comment was made by Bennett Katz of Zenith Insurance Company and involved a technical error in the proposed regulations concerning the number of digits specified in the codes.

ICD-10 is not simply an upgrade of the current ICD-9 code, it is a total rewrite, intended to provide better detail and data collection for physicians, hospitals and payers.

This detail comes at a price. The sheer volume of these codes, increasing fourfold over the current ICD-9 standard, brings a real set of challenges for workers’ comp adjusters who are expected to quickly review these codes for appropriateness and relatedness on incoming bills. For these adjusters, any additional time spent deciphering these 68,000 codes means less time spent getting injured workers back to work, more jurisdictional penalties as delays impact payment, or higher medical spend as inappropriate bills sneak through.

ICD-10 will offer a much greater level of detail for companies ready to accept the additional data detail. One thing that ICD-10 will do is specify between right and left on bilateral body parts and make a distinction between acute and chronic treatments. This will increase the accuracy of the diagnosis and treatment which will reduce costs by cutting down on unnecessary testing. More detailed data may lead to better preventive safety protocols as a result of identifying the specific source of injury. This data is also helpful in forecasting or predicting trends in medicine. Medical technology and treatments are constantly evolving and improving, and ICD-10 accommodates new breakthroughs in treatments. ICD-10 can allow for comprehensive reporting which will be useful for determining risk and effectiveness of other programs. The impact of ICD-10 on adjusters will be significant if not managed properly.

Once the system is in full swing and everyone becomes more familiar with the codes it may help cut down fraud and abuse. Injured body parts will be more definitive and treatments will be more concise. It will make it harder for a doctor to add a CPT code that is completely unrelated because the ICD-10 will be so very specific. Technology can be a help to payers and adjusters, who need to embrace change and realize that evolving technology will decrease their workflow and enable them to close claims faster. Automating certain aspects of the system will allow adjusters to be two or three steps ahead of a claim to keep it from spiraling out of control rather than always being on the defensive end of a claim.

Whether you are a fan ICD-10 or not, it’s coming; there is no stopping it come October. Time will tell how this affects the workers’ compensation industry.

3D Printed Human Implants Revolutionizing Surgeries

3D printing is a process of making a three-dimensional solid object of virtually any shape from a digital model. 3D printable models may be created with a 3D scanner. To perform a print, the machine reads the design from 3D printable file and lays down successive layers of liquid, powder, paper or sheet material to build the model from a series of cross sections. These layers, which correspond to the virtual cross sections from the model, are joined or automatically fused to create the final shape. The primary advantage of this technique is its ability to create almost any shape or geometric feature.The 3D printing technology is used for both prototyping and distributed manufacturing with applications in architecture, construction, industrial design, automotive, aerospace, military, engineering, dental and medical industries, biotech (human tissue replacement), fashion, footwear, jewelry, eyewear, education, geographic information systems, food, and many other fields. Several projects and companies are develop affordable 3D printers for home desktop use.

NBC News reports that doctors in the Netherlands have for the first time successfully replaced most of a human’s skull with a 3-D printed plastic one – and likely saved a woman’s life in the process.The 23-hour surgery took place three months ago at University Medical Center Utrecht. The hospital announced details of the groundbreaking operation this week and said the patient, a 22-year-old woman, is doing just fine.

The woman, whose name wasn’t released, suffered from severe headaches due to a thickening of her skull. She slowly lost her vision, her motor coordination was suffering and it was only a matter of time before other essential brain functions would have atrophied, Dr. Verweij said in a press release issued by UMC Utrecht. Verweij noted that in some brain operations it’s common for part of the skull to be temporarily removed to reduce pressure on the brain, then put back later or replaced by an artificial implant. In this case, doctors inserted nearly an entire plastic skull that was manufactured with the help of Anatomics, an Australian medical device company that specializes in 3-D printing,

“We used to create an implant by hand in the operating theater using a kind of cement, but those implants did not have a very good fit,” Dr. Verweij said. “Now we can use 3-D printing to ensure that these components are an exact fit. This has major advantages, not only cosmetically but also because patients often have better brain function compared with the old method.”

Three months after surgery, the woman’s pain is gone and she can see again. “The patient has fully regained her vision, she has no more complaints, she’s gone back to work and there are almost no traces that she had any surgery at all,” said Dr. Verweij.

In another success story, Business Insider reports that a British surgeon successfully implanted a 3-D printed pelvis for a man who lost half his pelvis to bone cancer. It was the first transplant of its kind. The patient, who is in his sixties and has remained unnamed, suffered from a rare type of bone cancer called chondrosarcoma. It affected the entire right side of his pelvis. According to orthopedic surgeon Craig Gerrand, who performed the surgery, it would have been impossible to attach a standard implant because so much bone had to be removed. In order to create the 3-D printed pelvis, the surgeons took scans of the man’s pelvis to take exact measurements of how much 3-D printed bone needed to be produced and passed it along to Stanmore Implants. The company used the scans to create a titanium 3-D replacement, by fusing layers of titanium together and then coating it with a mineral that would allow the remaining bone cells to attach. After the titanium pelvis was attached, the team added a standard hip replacement to complete the surgery. The procedure, which happened three years ago, was an unrivaled success. The man has been walking with a cane and remains happy with the results.

3D printing is revolutionizing the health care sector: The technology has been successfully used to make prosthetic limbs, custom hearing aids, now a pelvis and a human skull, and potentially human tissue by what is called “bioprinting.”

Federal Jury Convicts Orthomed Owner in Fraud Case

A Southern California man who ran a durable medical equipment (DME) supply company has been found guilty by a federal jury in Los Angeles for his role in a $1.5 million Medicare fraud scheme. Vahe Tahmasian, 36, of Glendale, California., was found guilty this month in U.S. District Court in the Central District of California of one count of conspiracy to commit health care fraud, six counts of health care fraud and six counts of aggravated identity theft. Sentencing is set for June 9, 2014.

The evidence introduced at trial showed that between April 2009 and February 2011, Tahmasian operated a Medicare fraud scheme at Orthomed Appliance Inc. (Orthomed), a DME supply company in West Hollywood, Calif. Tahmasian and his co-conspirator, Eric Mkhitarian, purchased Orthomed from the previous owners and put the company in the name of a straw owner.The defendant and his co-conspirator then stole the personal identifying information of Medicare beneficiaries and doctors in the company’s patient files and used that information to submit a large volume of fraudulent claims to Medicare. The evidence showed that during a three-month period in late 2010, Tahmasian submitted more than $1.2 million in fraudulent claims to Medicare for services that were never prescribed by a physician and never provided to the Medicare beneficiaries. Tahmasian and his co-conspirator then took out more than $622,000 in cash from the company over a six-week period in early 2011. The evidence at trial showed that Tahmasian used a fake California driver’s license during the course of the fraudulent scheme.Tahmasian submitted a total of $1,584,640 in claims to Medicare and received approximately $994,036 on those claims.

Mkhitarian, Tahmasian’s alleged co-conspirator, remains a fugitive.

The case was investigated by the FBI and the Los Angeles Region of HHS-OIG and brought as part of the Medicare Fraud Strike Force, under the supervision of the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Central District of California. The case is being prosecuted by Assistant Chief Benton Curtis and Trial Attorney Alexander Porter of the Fraud Section.

Tahmasian’s prosecution is one of a steady stream of cases moving through the justice system that underscore the need to make DME fraud and abuse a high enforcement priority.

Besides the frequent combination of medical identity theft and fraudulent billing, other DME-related schemes to watch for include billing for high-end products but delivering inferior ones, forging product prescriptions and paying kickbacks to professionals authorized to prescribe DME, according to a commentary by former U.S. Health and Human Services Inspector General Richard P. Kusserow.

CDC Says 4% Acquire Infections in Hospitals and Medical Facilities

On any given day, one in 25 hospitalized patients – 4 percent – is battling an infection picked up in a hospital or other healthcare facility, according to a new survey by the Centers for Disease Control and Prevention (CDC). That translates to more than 600,000 hospital patients each year. Roughly 74,000 of them have to fight more than one hospital-acquired infection, researchers found. About half of those infections were either linked to a device attached to the patient, like a catheter or ventilator, or occurred after a surgical procedure at the site of the surgery. An infection acquired in this manner in an industrial case would also be covered as a compensable consequence of the initial injury.

Previous estimates had pegged the annual number of infections at 2.1 million in the 1970s and 1.7 million from 1990 through 2002. “The trend, in magnitude, seems to be going in the right direction,” Dr. Mike Bell, deputy director of the Division of Healthcare Quality Promotion at the CDC, told Reuters Health. Despite continuing concern about hospital-acquired infections, especially ones that are resistant to antibiotics, the U.S. does not have a national system for collecting information on the problem.

The new study, led by Dr. Shelley S. Magill of the CDC and published in the New England Journal of Medicine, was based on an analysis of 11,282 patients treated at 183 hospitals in 10 states. The survey in each hospital was done over the course of a day, involving as many as 100 patients per facility. Pneumonia accounted for about 22 percent of the hospital-acquired infections. Another 22 percent were infections at the surgical site, and 17 percent were stomach or intestinal illnesses. Urinary tract and bloodstream infections ranked fourth and fifth, respectively. The most common bacterium responsible was Clostridium difficile, which kills an estimated 14,000 people in the U.S. each year. It was detected in 12 percent of the hospital-acquired illnesses and was responsible for 71 percent of gastrointestinal infections in particular. Nursing homes, emergency departments, rehabilitation hospitals and outpatient treatment centers were not included in the tally.

The researchers estimated that in 2011, 648,000 hospitalized patients had to battle at least one hospital-acquired infection. The total number of infections was estimated at 721,800. To put that number in perspective, about 34 million people are admitted to 5,000 community hospitals in the U.S. each year. The new report “validates the work we’ve been doing, focusing on some of the severe infections related to intensive care, related to devices such as catheters in the bloodstream or the bladder, mechanical ventilation or surgical procedures,” Bell said.

To prevent infections, the National Patient Safety Foundation recommends patients wash their hands regularly and remind their doctors and nurses to do the same. Patients should also make sure both bandages and the skin around any catheters are kept clean and dry, it says.

State Sen. Leland Yee Indicted in FBI Corruption Case

State Senator Leland Yee has been indicted for public corruption as part of another major FBI operation. San Francisco Police Chief Greg Suhr described the raids to KCBS as “massive.” “Hundreds of officers are involved in this,” he said.

Yee was taken into San Francisco’s Federal Building wearing handcuffs FBI agents and local police are serving arrest and search warrants throughout the Bay Area, with agents seen in locations in San Francisco and San Mateo, as well as Yee’s Capitol office in Sacramento. Targets of the raid are expected to appear in federal court in San Francisco this afternoon. Yee’s indictment likely ruins his candidacy for Secretary of State, and threatens Democrats’ ability to restore the state Senate supermajority that already has been broken by two other lawmakers’ paid leaves of absence to deal with criminal charges.

Yee represents San Francisco and a portion of San Mateo County. Before becoming the first Chinese-American ever elected to the state Senate in 2006, Yee was an Assemblyman from 2002 to 2006; a San Francisco supervisor from 1997 to 2002; and had been a member and president of the San Francisco Unified School District board. While in the Assembly, he was the first Asian-American to be named Speaker pro Tempore, essentially making him the chamber’s second-most-powerful Democrat.

Yee is the state’s third Democratic legislator recently tied to corruption allegations. In February, State Sen. Ron Calderon, D-Montebello, surrendered to authorities after being indicted on bribery charges surrounding proposed workers’ compensation law and Pacific Hospital in Long Beach. In January, Assemblyman Roderick Wright, D-Inglewood, was convicted of voter fraud and perjury stemming from a 2010 indictment.

Derek Cressman, who until last June was vice president of the non-partisan government watchdog group Common Cause, issued a statement Wednesday morning saying that Yee’s indictment must be “a wake-up call” given other Senate Democrats’ criminal charges. “We are clearly beyond the point of looking at one bad apple and instead looking at a corrupt institution in the California senate,” Cressman said. “The constant begging for campaign cash clearly has a corrosive effect on a person’s soul and the only solution is to get big money out of our politics once and for all.”

Defense Attorney Convicted of Stealing $2 Million From MTA

A former Rancho Cucamonga attorney who once handled some of the Metropolitan Transportation Authority’s toughest legal cases was convicted of stealing nearly $2 million from the transit agency by submitting phony invoices and pocketing settlement money. James Vincent Reiss, who also was convicted of stealing more than $1 million from other clients, pleaded no contest to two felony counts of grand theft. For 15 years, Reiss defended Metro in multimillion-dollar injury lawsuits involving rail and bus passengers until officials realized he was defrauding the agency, said Jane Robison, an L.A. County district attorney’s spokeswoman. Reiss, 52, made the plea as part of a deal in which prosecutors agreed to drop nine other felony counts of theft, forgery and fraud. He is set to be sentenced March 26, and the court is expected to require that he pay more $3 million in restitution and serve a decade in prison.

Reiss created fraudulent documents that led Metro to write checks that he ultimately kept for himself instead of paying plaintiffs who sued the agency. Karen Gorman, acting inspector general for Metro, said a State Bar of California investigation into problems with Reiss’ other clients in 2012 tipped off the agency to the potential for trouble, and officials immediately began auditing his cases. “We aggressively began to investigate – and working with the district attorney’s office we were able to bring Mr. Reiss to justice for his crimes.”

According to a Metro lawsuit filed against Reiss’ law firm in January for malpractice, forgery and negligence, Reiss cost the agency as much as $2.5 million. In 2011, Reiss allegedly told the MTA that it had negotiated a $2.5-million jury award down to $1.765 million. But when the Metro board authorized the settlement and ordered that two checks totaling $1.765 million be written, Reiss kept the money, according to the suit. Reiss then filed an appeal, delaying the case. Metro eventually resolved the case by paying $2.5 million. The suit alleges Reiss also submitted “numerous falsified invoices totaling at least $754,000,” for costs and kept the money.

Prosecutors said that in addition to the MTA, Reiss also took advantage of other clients. In one case, he settled a suit without the client’s knowledge, forged signatures on paperwork and pocketed the money, prosecutors said. In another case involving a trust, he opened a bank account, deposited a client’s money and wrote checks to himself, prosecutors said.

Reiss, was disbarred on March 16, 2013 after a state Bar Court judge called his case an illustration of the “disciplinary consequences of dishonesty,” The State Bar case went on to conclude “the most serious aggravation is found in Reiss’s 10-year pattern of deception in order to cover up mismanagement of his clients’ cases or for his personal economic gain. …Without a hint of remorse, Reiss has refused to acknowledge his misconduct despite overwhelming evidence of his dishonesty and the harm he caused to his clients. While the law does not require Reiss to be falsely penitent, it does require that [he] accept responsibility for his acts and come to grips with his culpability.”

Comp Rates Continue to Climb

Rates and premiums for workers’ compensation insurance are continuing to climb across the US, driven by factors including the prolonged low interest rate environment and rising medical costs. Meanwhile, implementation of the Affordable Care Act (ACA) and the potential expiration of the Terrorism Risk Insurance Program Reauthorization Act (TRIPRA) are two other factors that could make a significant impact on the workers’ comp market as 2014 unfolds.

As the U.S. unemployment rate shows modest declines and wages are slowly increasing, it’s no surprise that workers’ compensation premiums are continuing to show growth. A quick look back at the past 8 years tells us that the workers’ compensation market suffered through a 27% decline in premium from 2006 to 2010 before rebounding with growth in the past 3 years, including a 10% increase in 2012 to more than $39 billion according to an annual study by the National Council on Compensation Insurance (NCCI).

Wells Fargo took a look at what to expect through 2014 in the workers’ comp market in its 2014 Insurance Market Outlook, released at the end of January. In addition to concurring with the Marsh report regarding TRIPRA, the report forecasts continued rate increases for the first three quarters of this year, along with continued reduction in the combined loss ratio, resulting from higher prices seen over the past three years. The report includes several other predictions, such as continued movement away from guaranteed cost program structures into higher deductible program structures, either because they are a more appealing alternative or a necessity. One final prediction in the report says the continued use of predictive modeling analysis to improve risk selection, proper retention levels and pricing will result in more conservative underwriting by the insurers.

Health care reform hasn’t made a significant impact on the US workers’ comp market to date, but that isn’t expected to be the case for much longer. The effects could be both beneficial and detrimental. Ruth Estrich, chief strategy officer at Philadelphia-based MedRisk, a workers’ comp-focused managed care company, says the impact could come in a variety of forms. One way would be reduced severity in worker’s comp. If millions of people who were previously uninsured become insured, one would hope that these people will get healthier. For people that have chronic issues (such as asthma), having health insurance that allows them to manage their issues should impact how quickly they heal, become functional and get back in the workplace. Someone who is not getting care for their chronic issues will likely take longer to recover in a workers’ comp situation.

Estrich says another issue the industry is watching is access to primary care physicians (PCPs). “If you think about all of those folks who will start accessing health care through their PCP, we are headed toward a problem with access to primary care,” Estrich says. “People were already predicting that access to primary care will be a problem. It could be a perfect storm.” In worker’s comp, a lot of the treatment and first response in many cases comes via a person’s PCP. Estrich says it is conceivable that many PCPs, who are already in short supply, will elect to stop treating workers’ comp cases, which can be more challenging to deal with. This would obviously be a negative development for the workers’ comp market.

The third issue Estrich sees in the potential for a cost shift. People without health insurance have an incentive to ascribe their injury to a workplace event when it may well have happened away from the job, simply because they would be covered by workers’ comp and not covered if the injury occurs away from work. With more people being covered by health insurance, they would be less likely to claim an injury happened at work.

Painkiller Addiction Leads to “Lower Cost” Heroin Addiction

More than 12 million Americans reported using prescription painkillers in 2010 without a prescription or just for the high that they cause. Nearly 3 out of 4 drug overdose deaths are now caused by prescription painkillers. In 2008, some 14,800 deaths were attributed to the pills – more than cocaine and heroin combined. More than 475,000 emergency room visits were directly linked to prescription painkiller misuse or abuse in 2009, roughly double the number of five years earlier.

The global production of oxycodone, marketed as OxyContin in the United States, increased from two tons in 1990 to 135 tons in 2009. More than two-thirds of that supply was manufactured in the US, which, according to the United Nations Office on Drugs and Crime, increases the risk of its subsequent overprescription and diversion into illicit channels. Experts trace the rise of painkiller misuse in the US to 1996. That’s when the pharmaceutical company Purdue Pharma introduced OxyContin, a narcotic and derivative of opium. Andrew Kolodny, chief medical officer of Phoenix House, a national nonprofit treatment agency, describes OxyContin as essentially a “heroin pill.” It was made of oxycodone, a narcotic used to treat pain at the end of life. But the new pill would allow the company to reach a much wider audience.

“[Purdue] wanted a product that would be prescribed for common, moderately painful chronic conditions,” says Dr. Kolodny, who is also president of Physicians for Responsible Opioid Prescribing, an advocacy group. At first, the medical community balked. Using opioids for chronic problems seemed too risky given the nature of the pills’ highly addictive properties. But Purdue Pharma launched an aggressive marketing campaign arguing that it was a compassionate way to treat patients and, because of its extended-release characteristics, would be less prone to abuse. But before long, numerous cases of addiction to the painkillers began to surface. In 2007, Purdue Pharma pleaded guilty in federal court to misleading doctors and the public about OxyContin’s risks and paid a $600 million penalty. Kolodny says that the overprescribing of painkillers has now led to an “epidemic” of addictions, both among pain patients and recreational users.

And once a person becomes addicted to painkillers, it isn’t a long journey to heroin – itself a derivative of morphine developed in the late 1800s as a painkiller. Joseph Gfroerer of SAMHSA co-wrote a recent study that found that, of those who had tried heroin, about 80 percent had previously used painkillers without a prescription. From Los Angeles to Long Island, Chicago to New Orleans, parents and police are struggling with a rise in heroin use in suburban neighborhoods. The rise is being driven by a large supply of cheap heroin in purer concentrations that can be inhaled or smoked, which often removes the stigma associated with injecting it with a needle. But much of the increase among suburban teens, as well as a growing number of adults, has also coincided with a sharp rise in the use of prescription painkiller pills, which medical experts say are essentially identical to heroin. These painkillers, or opioids, are prescribed for things such as sports injuries, dental procedures, or chronic back pain. Yet in a disturbing number of cases, experts say, they are leading to overdependence and often to addiction to the pills themselves, which can then lead to heroin use. Once hooked, users look for doctors who will sell them prescription drugs and, failing that, turn desperately to the street, where the price can be as high as $80 for a single pill. When that becomes too expensive, users often resort to the drug that produces the same kind of high that painkillers do but is far cheaper: heroin.

The latest rise in heroin abuse was made more visible by the recent overdose death of actor Philip Seymour Hoffman. But use of the drug has been growing steadily across many levels of society for at least the past five years. And unlike the heroin surge in the 1970s, the current use of opiates is far more concentrated among suburban and rural whites than among African-American and Latino communities. The heroin that addicts used to shoot up with was 2 or 3 percent pure. Today, the street purity of the drug can be as high as 80 percent. That potency helps explain both the drug’s wider appeal and its new danger. Heroin once had to be injected for users to get the high they were looking to achieve, but it is now concentrated enough that they can smoke or snort it to get a similar effect – methods that make heroin easier for people to use it without feeling like a junkie. The higher purity is also more likely to trigger an overdose for those who do inject it.

So. Cal Water District Faces Insurance Crisis with JPA

Central Basin Municipal Water District is a public agency that purchases imported water from the Metropolitan Water District of Southern California and wholesales the imported water to cities, mutual water companies, investor-owned utilities and private companies in southeast Los Angeles County. There are 24 cities in Central Basin’s service area. The company is headquartered in Commerce California. The politically explosive District appears to be within a few days of financial armageddon after the agency was officially put on notice that its public insurance carrier is dropping them as a client.

According to the report by Hews Media Group-Community Newspaper, the Association of California Water Agencies and the Joint Powers Insurance Authority (ACWA-JPIA) officially informed Central Basin officials that their insurance coverage has been discontinued citing the “workings of a dysfunctional Board of Directors.” The District claims it is now “proactively reviewing all its available insurance options and alternative providers, in light of a pending decision by ACWA-JPIA regarding the District’s future relationship with the insurance provider.

During the past year, HMG-CN has published dozens of exclusive investigative reports documenting deep legal problems allegedly caused by Directors Robert Apodaca, James Roybal and Leticia Vasquez that could be the reasons for JPIA dropping the agency. HMG-CN disclosed the details of a sordid sexual harassment complaint lodged by a female employee against Apodaca;The newspaper has learned that the alleged victim in the case could be handed a high seven-figure settlement. Sources also tell HMG-CN that other females may be in the process of coming forward to file additional cases of sexual harassment activities against Apodaca.

HMG-CN also was the first news outlet to confirm and disclose the details of Director Leticia Vasquez’ filing of a highly controversial whistleblower lawsuit against her own agency. Vasquez, who denied she would be filing the lawsuit until it was revealed by HMG-CN, claims to have been “victimized” by many parties, individuals and law firms who have banked millions in questionable contracts with the agency during the past decade. Vasquez’s lawsuit also goes after her top political alley and heavy campaign contributor Ernest “Ernie” Camacho who is the owner of Pacifica Services. It also cited the Calderons, and other companies. Camacho and his company have banked millions in exclusive contracts with Central Basin.

Vasquez staged a bizarre press conference two weeks ago where she demanded that another director, Art Chacon resign his seat after it was learned that he had been involved in one accident while performing district business. The accident is in litigation, JPIA is fighting the fact that Chacon was working despite multiple sources coming forward to HMG-CN saying he was working, and is set for arbitration August of this year.

Former Central Basin District executive Ron Beilke also filed a complaint alleging wrongfully termination, retaliation, and harassment during his short tenure at the agency. Beilke confirmed to HMG-CN that he is plans to file a seven-figure lawsuit and plans to name Roybal, Apodaca and Vasquez individually in the complaint.

Phil Hawkins, who recently took over as President of the Board of Directors after Roybal was removed with the support of Apodaca and Chacon also chimed in on the current insurance crisis. “This District is hanging on by a thread and our General Manager and staff has done amazing things to right this ship. Our General Manager (Perez) just completed the biggest water sale in our District’s history and has aggressively been identifying potential long term recycled water customers, but somehow our Board continues to drag this agency through the mud,” said Hawkins a former state assemblyman from Cerritos. “What I will say to this Board is that the cancellation of our insurance is the ultimate wake-up call. Let’s settle down, let staff do their jobs and try to remember that it’s not about us, it’s about our 2 million customers,” Hawkins continued.

The agency is also being investigated by the Federal Bureau of Investigation, the Los Angeles County District Attorney’s Office, the Internal Revenue Service and the United States Attorney’s Office in connection with a case involving current State Senator Ronald Calderon and former Assemblyman Thomas Calderon.