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Tag: 2014 News

Orange County Corrections Officer Faces 17 Year Sentence

An Orange County employee was arraigned for committing insurance fraud and perjury by making false statements and concealing information related to his worker’s compensation claim.

William Parker, 43, Corona, is charged with 15 felony counts of insurance fraud, four felony counts of making a fraudulent statement, two felony counts of attempted perjury under oath, and one felony count of perjury by declaration. If convicted, Parker faces a maximum sentence of 17 years and six months in state prison. Parker is being held on $50,000 bail.

On June 4, 2005, Parker was hired by the Orange County Probation Department (OCPD) as a Deputy Juvenile Corrections Officer. On Oct. 5, 2007, Parker was involved in a non-work related motor vehicle accident which caused injuries to his back and resulted in loss of time from work. Parker filed an insurance claim as a result of that automobile accident and received a settlement.

On Sept. 28, 2010, Parker claimed he suffered a back injury while working for the OCPD. Parker filed a Worker’s Compensation Claim and was taken off work by his treating doctors after the county accepted the claim. Parker did not return to work until late February 2013 when he returned as an Office Specialist due to his claimed injuries.

In February 2012, Parker filed a lawsuit against a citizen for personal injuries where the defendant claimed injuries to his back after sustaining another motor vehicle accident. During the pendency of this lawsuit, Parker is accused of making material misrepresentations and perjuring himself during his depositions and in his responses to interrogatories.

Between 2010 and 2013, Parker was treated by various doctors as a result of his claim. While being treated by doctors, Parker is accused of denying and failing to disclose the prior injuries about his back.

Deputy District Attorney Pam Leitao of the Insurance Fraud Unit is prosecuting this case.

Commissioner Adopts 2015 Comp Premium Increase

Insurance Commissioner Dave Jones adopted an advisory average pure premium rate of $2.74 per $100 of employer payroll for workers’ compensation rates effective January 1, 2015. The adopted amount is a 2.2% increase, but lower than that proposed by the Workers’ Compensation Insurance Rating Bureau of California (WCIRB). The WCIRB’s proposed advisory average rate was $2.77 per $100 of payroll. After a public hearing and careful review of the testimony and evidence submitted, the Department of Insurance recommended adoption of a pure premium rate amount lower than the WCIRB on the basis that a greater reduction in medical losses should be used in the actuarial model due to the anticipated savings from SB 863 (De León) signed in 2012.

The WCIRB’s proposed advisory average pure premium rate is 7.9 percent ($2.77 per $100 of payroll) above the industry’s average filed rates as of July 1, 2014 and the adopted pure premium rate ($2.74 per $100 of payroll) is 6.7 percent above the industry’s average filed rates as of July 1, 2014.

Commissioner Jones, the WCIRB and the public members’ actuary all agree that the overall impact of SB 863 continues to result in savings for the workers’ compensation system. The California Department of Insurance continues to observe that medical and indemnity losses are outpacing wage growth and consequently, the average advisory pure premium will increase in 2015.

The commissioner’s pure premium decision is advisory only. Pursuant to California law, the commissioner does not set or have authority over workers’ compensation insurance rates. The commissioner’s advisory pure premium rate is not predictive of what an individual insurance company may charge its policyholders because the review of pure premium rates is just one component of insurance pricing.

DWC Posts More Changes to EDI Implementation Guide

The Division of Workers’ Compensation has made further changes to its California EDI Implementation Guide, Version 2.0, pursuant to revision of the Workers’ Compensation Information System (WCIS) regulations. The changes are subject to an additional public comment period of 15 days. The comment period will close on November 28, 2014.

The California legislature enacted sweeping reforms to California’s workers’ compensation system in 1993. The legislature directed the DWC to put together comprehensive information about workers’ compensation in California. The result is the WCIS. The WCIS has four components: the First Reports of Injury (FROI) reporting guidelines were implemented March 1, 2000. The Subsequent Reports of Injury (SROI) reporting guidelines were implemented July 1, 2000. Reporting of annual summary of benefits began January 31, 2001

Medical bill payment reporting regulations were adopted on March 22, 2006. The regulations require medical bill payment records for services with a date of service on or after September 22, 2006 and a date of injury on or after March 1, 2000 to be transmitted to the DWC. The medical services are required to be reported to the WCIS by all claims administrators handling 150 or more total claims per year.

California workers’ compensation medical bill payment records are processed by diverse organizations: large multi-state insurance companies, smaller specialty insurance carriers, self-insured employers or insurers, third-party administrators handling claims on behalf of self-insured employers, as well as bill review companies. The organizations have widely differing technological capabilities, so the WCIS is designed to be as flexible as possible in supporting EDI medical transmissions. EDI is the computer-to-computer exchange of data or information in a standardized format. In California, workers’ compensation, medical EDI refers to the electronic transmission of detailed medical bill payment records information from trading partners, i.e., senders, to the California DWC.

The DWC incorporated the primarily technical changes to the California EDI Implementation Guide, Version 2.0 proposed by members of the workers’ compensation community, including these new proposed changes:

1) Adding a table showing California-adopted IK4 error codes for 999 acknowledgements
2) Editing the California Edit Matrix table to correspond to entries in the IK4 error code for 999 acknowledgements table
3) Further clarifying procedures for reporting lump-sum lien settlement payment data.

The DWC believes that these updates will allow WCIS to collect more robust and useful data that will assist with research regarding workers’ compensation issues. The notice and text of the regulations can be found on the proposed regulations page.

Cal/OSHA Fines Fuel Distributor Nearly $100 K For Fatal Explosion.

Cal/OSHA has cited fuel distribution company National Distribution Services Inc. (NDS) $99,345 following an investigation into an explosion at the company’s Corona facility that killed one employee and left another with severe burns. The owner of the company has been previously cited for similar incidents.

On May 6, 2014, two employees attempted welding operations on a 9,000-gallon tanker truck containing an unknown amount of crude oil. The tank had not been purged or tested for flammable vapors, resulting in the explosion. Samuel Enciso, 52, was a welder who had been with NDS for four years. He was found dead on the floor of the facility with his right hand and lower arm completely severed. A second employee with five years of experience suffered burns to more than 50 percent of his body.

Investigators from the San Bernardino Cal/OSHA District Office determined that NDS contributed to this incident by failing to have required safety procedures in place for working with flammable vapors. Additionally, investigators found that NDS failed to train employees on the dangers of welding near combustible materials.

“California requires employers to have and adhere to an Injury and Illness Prevention Program” said Christine Baker, Director of the Department of Industrial Relations (DIR). Cal/OSHA, formally known as the Division of Occupational Safety and Health, is a division of DIR. “This preventable death is a reminder of what can happen when that requirement is ignored,” said Baker.

While investigating the May 6 event, investigators learned about a previous explosion at the Corona facility that occurred under similar circumstances, and involved the same two NDS employees. On September 25, 2012, the lid of a fuel tanker blew through the ceiling of the repair facility after the employees commenced welding on a truck filled with flammable vapors. No injuries occurred on that date.

The owner of NDS, Carl Bradley Johansson, served prison time following a previous similar incident. In the 1990s, Johansson operated a business in Montebello known as Atlas Bulk Carriers. On September 27, 1993 there was an explosion involving welding operations on a fuel tanker that had also not been purged or tested. This incident also took the life of a welder employed by the company. Atlas Bulk Carriers was cited by Cal/OSHA for this incident.

FDA Approves Customized Spine Implant

The California workers’ compensation community recently learned of questions raised about the authenticity of surgical screws used in spine implants at various hospitals in Southern California as a result of litigation brought by claimants who claim they received counterfeit hardware implants. The topic of questioning the manufacturing credentials of medical suppliers is now proving to potentially have significant benefits in claims administration strategies. It may be important to know more about what is at the forefront of implant technologies so that better treatment choices can be made. Unfortunately, the UR/IMR process typically answers the question “should someone have a surgery?” but typically omits answering the question “what brands of surgical implant devices are the best choice for the job?” To add to our knowledge about the surgical implant industry, here is some news about the latest surgical products recently approved by the FDA for spine surgeries.

The MEDICREA group, a company that specializes in the development of personalized implants produced for a patient’s specific need in the treatment of spinal pathologies, has announced the company has received 510(k) clearance from the U.S. Food and Drug Administration for UNiD, the world’s first patient-specific spinal osteosynthesis rod. The technology will be premiered at the 2014 North American Spine Society (NASS) Annual Meeting taking place on November 12-15 in San Francisco. The first U.S. patient underwent surgery to have personalized UNiD rods implanted earlier this month in New York.

UNiD is the first patient-specific device cleared to treat degenerative spine conditions including scoliosis and other type of deformities. According to the National Scoliosis Foundation, an estimated six million people in the U.S. have scoliosis. Each year scoliosis patients make more than 600,000 visits to private physician offices, and an estimated 38,000 patients undergo spinal fusion surgery. Adult spinal deformity surgery is likely to increase in frequency with as much as 32 percent of the adult population suffering from scoliosis and a prevalence of 60 percent among the elderly. Hospital costs of adult spinal deformity surgery can exceed $100,000 per patient. Revisions and reoperations place a large financial burden on the health care system – increasing the average cost of adult spinal deformity surgery by more than 70 percent.

UNiD patient-specific rods are universal implants available in two alloys (Titanium TA6V ELI/Cobalt Chromium) and two diameters (5.5 mm/6 mm), that match global standards. UNiD naturally fits into the PASS LP® thoraco-lumbar fixation system. The PASS LP® system is already used by numerous spine surgeons in 35 countries, and notably in the United States where this product accounts for the majority of MEDICREA USA Corporation’s sales. MEDICREA’s customized spine implant platform also includes the UNiD anterior lumbar interbody fusion (ALIF) spine cages created with a 3-D printer. With the support of specific software and advanced imaging, the UNiDTM ALIF customized cages made of Poly Ether Ketone Ketone (PEKK) exactly reproduce the anatomic details of a patient’s vertebral endplates. The world’s first spinal fusion surgery using the UNiD ALIF customized 3-D printed spine cages was performed on May 28, 2014 in France.

UNiDTM features a software tool to help surgeons preoperatively plan their surgery and order customized, industrially-produced rods to fit the specific spinal alignment needed for each individual patient. UNiDTM eliminates the need to manually contour a rod during surgery, providing surgeons with a precisely aligned rod prior to surgery and reducing the amount of time patients spend in the operating room, which directly impacts infection rate and quality of recovery.

The customized rod, according to the manufacturer, claims to offer numerous benefits to surgeons and patients undergoing spine surgery. The primary benefit is it allows surgeons to plan and then execute their operating strategy without compromises or approximation errors. Surgeons can improve their success rate in terms of global sagittal patient alignment, and reduce the risk of spinal implant failure.

Obamacare Open Enrollment Brings Higher Costs

The technology glitches may be a thing of the past. But people shopping online for health insurance plans under Obama’s healthcare law may encounter a new set of problems early next week, one of them being unexpected new costs., the federal website where people enroll for insurance under the Affordable Care Act, opens for sign-ups for policies covering 2015 this Saturday, the so-called open enrollment period.

The site launched for the first time a year ago but tech snafus made it virtually unuseable for weeks, giving plenty of ammunition for critics of the 2010 law that aimed to make healthcare more affordable for millions of Americans. The website is now much improved, but many consumers may find themselves early in the new year beset by higher costs, unexpected demands for return of subsidies and double-billings.

According to the report in Reuters News, Insurance industry officials, congressional aides and analysts say potential problems will mainly affect current Obamacare policyholders and could intensify public hostility toward the law, just as Republicans – long opposed to the law – take over as a majority in the U.S. Senate in January. The Nov. 15-Feb. 15 open enrollment period allows qualified Americans to obtain private health coverage, often with federally subsidized premiums. Premiums overall appear stable, although some existing plans may rise in price and newer policies may offer consumers better terms.

But there is concern about how smoothly the administration will handle the some 5.9 million 2014 policyholders expected to re-enroll. Some experts say the challenge of re-enrolling millions while adding millions of newcomers could be behind this week’s sharp reduction in official enrollment forecasts for 2015. An estimated 4.4 million people could opt simply to have their policies renewed automatically by Dec. 15, according to the consulting firm Avalere. But many of those could wind up with unexpectedly higher costs as insurers raise premiums on existing policies, experts say.

Even those who actively hunt for cheaper plans could still face issues. Some consumers who cancel existing coverage could initially be billed twice – once for each plan – because the government has no automated system for notifying insurers of such changes, said one insurance industry official, speaking on condition of anonymity.    

And policyholders who got subsidies to help pay for 2014 coverage could also be told to return some of that money, if their incomes rose later in the year and they did not notify the government.

WCAB Panel Says Failure to Notify by Fax or Telephone Invalidates UR

Kimberly Rivera injured her back while working for Valley Radiology in 2010. Dr. Norman Kahan is the primary treating physician.

On June 13, 2013, Dr. Kahan issued a request for authorization (RFA) requesting acupuncture and medications (Flexeril, Norco, Neurontin, Terocin and a Theramine medical supplement). The parties dispute the date that defendant received the RFA. Applicant claims July 5, 2013 and defendant claims July 8, 2013. The UR non-certification is dated on 07/16/2013, yet it indicates a determination date of 07/15/2013, and has a proof of service date of 07/15/2013. Thus the WCJ characterized it as “internally inconsistent.”

The parties attended an expedited hearing and submitted the medical treatment issue framed by the UR dispute for determination. The WCJ determined that UR was untimely, and therefore the underlying medical treatment issue was not subject to Independent Medical Review (!MR). Defendant disputes the determination that UR was untimely and Petitioned for Reconsideration which was denied in the panel decision of Rivera v Valley Radiology.

Pursuant to 8 CCR Section 9792.9(a)(J) the RFA shall be deemed to have been received by Defendant by facsimile on the date the request was received if the receiving facsimile electronically date stamps the transmission. If there is no electronically stamped date recorded, then the date the request was transmitted is deemed the date upon which the RFA was received. Here, Defendant offered no evidence of what the receiving facsimile recorded or when. As such, the Regulations are clear that the received date is deemed to be 07/05/2013. Based on the Regulations as applied to the evidence offered, the UR determination was due by 07/12/2013. The UR letter is dated 07/16/2013 and an internally inconsistent proof of service dated 07/15/2013. The WCJ reasoned that “Utilizing either the 07/15/2013 date or the 07/16/2013 date really makes no difference as the UR determination was due by 07/12/2013 and therefore in either case Defendant’s UR is untimely.”

On Reconsideration Defendant claimed for the first time that it has an additional 24 hours pursuant to Section 4610(g)(l)(A) in which to communicate the decision, and therefore the 07/15/2013 determination was timely communicated on 07/16/2013. This argument was not raised at trial. The WCAB panel noted that the parties dispute the date that defendant received the RFA. “However, based on our review of the record, even assuming that defendant received the RFA on July 8, 2013, we find the UR untimely.”

Labor Code Section 4610 (3)(A) provides that “Decisions resulting in modification, delay, or denial of all or part of the requested health care service shall be communicated to physicians initially by telephone or facsimile, and to the physician and employee in writing within 24 hours for concurrent review, or within two business days of the decision for prospective review, as prescribed by the administrative director.”

Similarly, Administrative Director Rule 9792.9.1 states that: “For prospective, concurrent, or expedited review, a decision to modify, delay, or deny shall be communicated to the requesting physician within 24 hours of the decision, and shall be communicated to the requesting physician initially by telephone, facsimile, or electronic mail. The communication by telephone shall be followed by written notice to the requesting physician, the injured worker, and if the injured worker is represented by counsel, the injured worker’s attorney within 24 hours of the decision for concurrent review and within two (2) business days for prospective review and for expedited review within 72 hours of receipt of the request.”

The WCAB panel thus concluded “There is no evidence in this case that defendant communicated their decision “initially by telephone, facsimile, or electronic mail” before it served written notice on July 15, 2013. Therefore, we find defendant’s UR untimely. Accordingly, for the reasons stated herein, we affirm the September 26, 2013 Findings and Award.”

Woman Uses Internet Photos to Fake Comp Burn Injury

Selena Edwards, 38, of Victorville claimed that an unsecured lid caused steaming hot McDonald’s coffee to spill on her right hand, severely burning it. As supporting evidence, she provided pictures of second-degree burns. But the only burns Edwards may suffer from are the prosecutorial ones she now faces for allegedly faking her injuries.

State insurance officials said Edwards looked to the golden arches in Fontana on Jan. 28, 2013, to allegedly commit the crime to extract easy money from McDonald’s Corp. The woman claimed coffee had spilled on her right hand when she was handed a cup with an unsecured lid at the McDonald’s drive-through. The photos and medical documents Edwards provided to bolster her case came from the Internet. “We discovered that some of the photos were from a hospital website,” state Insurance Commissioner Dave Jones said. Edwards also submitted counterfeit documentation for treatment that she claimed to have received from a local hospital. “We contacted her medical provider and discovered she hadn’t received any medical treatment.” The San Bernardino County district attorney charged Edwards with 21 felony counts of insurance fraud and workers’ compensation fraud.

The prosecution of Edwards comes 20 years after a jury awarded $2.9 million to a 79-year-old woman who was badly burned after hot coffee spilled into her lap at a McDonald’s in Albuquerque. The 1994 verdict attracted international attention, was mocked by radio and television talk-show hosts and was even used as a plot point in the TV comedy “Seinfeld.” ABC News called the case “the poster child of excessive lawsuits”, while the legal scholar Jonathan Turley argued that the claim was “a meaningful and worthy lawsuit”. In June 2011, HBO premiered Hot Coffee, a documentary that discussed in depth how the Liebeck case has centered in debates on tort reform. Despite the controversy, the woman in that case, Stella Liebeck, actually did suffer severe third-degree burns and required skin graft surgery.

In January, a woman filed a lawsuit against McDonald’s, saying she was burned when coffee spilled on her at one of the fast-food chain’s Los Angeles restaurants. Paulette Carr claimed she was burned on January 2012 because the lid on her cup was not properly secured. The lawsuit did not describe the severity of Carr’s injuries.

The merit of those cases aside, Jones said that every year tens of thousands of cases that potentially involve fraud are referred to his agency. In the last 11 months there have been 26,415 cases, about 1,549 of which remain open, officials say.

WCAB Panel Rules UR Decision Effective For 12 Months

Martha Reyes sustained and admitted industrial injury while working for Target. Her primary treating physician Dr. Sobol submitted a Request for Authorization on 02/25/2014 seeking authority for “home care assistance 4 hrs/day x 3 days/wk x 6 wks for cooking/cleaning/laundry/med [illegible].” Utilization Review evaluated the request and denied it on 03/28/2014. The applicant did not claim any material defect in the UR decision. Applicant claims to have sought IMR of the UR decision which had not been decided as of the following events.

The Sobol Orthopedic Medical Group then submitted a second similar request on 05/22/2014. He again requested “Home Care Assistance, 4 hours/ day, 3 days/week for 6 weeks,” The form indicates it to be a “New Request” rather than a “Resubmission – Change in Material Facts.” The request was untimely denied by Utilization Review on 06/17 /2014. This untimely 06/17 /2014 UR denial forms the basis of the present controversy.

Applicant filed a 07/10/2014 Declaration of Readiness to proceed to Expedited Hearing, voicing an objection to the 06/17 /2014 Utilization Review Determination as being untimely, and not based on substantial medical evidence. Defendant filed a timely objection to the DOR.

The matter proceeded to Expedited Hearing on 08/21/2014. Submitted for decision was the applicant’s need for further medical treatment generally (in the context of the 06/17 /2014 utilization review decision.) The WCJ determined that Labor Code § 4610(g)(6) bars applicant from litigating the 06/17 /2014 Utilization Review denial, as the same requested treatment was previously denied by Utilization Review on 03/28/2014, and there had been no showing of material change in circumstance necessitating another utilization review. Applicant filed the instant Petition for Reconsideration on 09/16/2014 which was denied in the panel decision of Reyes v Target Inc.

The WCAB panel concluded “Because the March 28, 2014 UR decision was not invalid, then in the absence of changed circumstances (not alleged here), that UR decision “shall remain effective for 12 months from the date of the decision without further action by the employer with regard to any further recommendation by the same physician for the same treatment.” (Lab. Code, § 4610(g)(6).) Accordingly, it is immaterial that applicant’s physician’s May 22, 2014 request for authorization (RFA) was not denied by defendant until June 17, 2014, even though that denial otherwise might have been deemed untimely had it been an initial RFA. (Lab. Code,§ 4610(g)(3).) Under section 4610(g)(6), defendant could properly have disregarded the new RFA and not issued a UR decision at all.”

University Medical Worker Faces Eight Years

A former clerical employee for the Loma Linda University Medical Center was arraigned on four felony counts of Workers’ Compensation Insurance Fraud and one count of Perjury

According to the District Attorney, and allegations in the criminal complaint, 44-year-old Tameca Lavonne Tyler-Willie of San Bernardino filed a workers’ compensation insurance claim in 2012 for an injury at work. According to Senior Investigator Jose Guzman, who is assigned to the case, Tyler-Willie was untruthful about the manner in which she was injured and as to the extent of those injuries, in both written and oral statements made in support of the claim, and to her physicians, Doctor Juma and Dr. Chun, regarding her injury and physical condition, and at a deposition under oath. Tyler-Willie is accused of attempting to defraud Loma Linda University Medical Center.

“As a result of these lies, Ms. Tyler-Willie received workers’ compensation insurance benefits that that she was not entitled to receive,” Guzman said.

Tyler-Willie pleaded not guilty to all counts. If convicted, she faces 8 years and 8 months in County Prison and a fine of up to $150,000. A Disposition/Reset Hearing has been set for Jan. 16, 2015. This case is being prosecuted by Deputy District Attorney David Simon.