Tag: 2019 News

A plan by the Ohio Bureau of Workers’ Compensation (BWC) to phase out coverage for Oxycontin and its generic form by the end of the year began Saturday.

Given their potential for abuse, misuse, addiction, and dependence, BWC will no longer pay for Oxycontin or generic sustained-release oxycodone tablets for workers who suffer on-the-job injuries on or after June 1. Injured workers currently on those medications will have until Dec. 31 to discontinue their use or switch to a different product on the agency’s formulary.

“We are encouraging injured workers to discuss with their physicians other effective painkillers on our formulary and to explore non-medication treatment options for chronic pain,” said BWC Administrator/CEO Stephanie McCloud. “Our priority remains the health and safety of our injured workers, which can be more challenging when an addiction enters the mix.”

McCloud added that workers who want to discontinue opioid use altogether should talk to their physician or BWC-contracted managed care organization. BWC will reimburse for certain services.

Ohio Governor Mike DeWine lauded the agency’s new rule.

“We want to prevent addiction, and I believe that this change will make an impact on Ohio’s opioid epidemic by promoting the safest possible treatments for injured workers with painful conditions,” said Governor DeWine.

The rule does not apply to immediate-release oxycodone, a medication used for acute pain.

Approved by BWC’s board of directors in February, the rule follows a thorough study over the last year by BWC’s pharmacy and therapeutics committee, which is comprised of physicians and pharmacists in the workers’ compensation system. It also follows a series of actions in recent years to mitigate the opioid epidemic’s impact on Ohio’s workforce.

The agency’s 2016 Opioid Rule, for instance, requires physicians follow specific best practices when prescribing opioids to injured workers.

The California Attorney General announced that California is suing Purdue Pharma L.P., Purdue Pharma Inc., certain of its affiliates, and Dr. Richard S. Sackler, former President and board member of Purdue, for unlawful practices in the marketing, sale, and distribution of opioids. The 56 page complaint was filed in Los Angeles Superior Court on June 3.

In addition to the lawsuit filed by the California Attorney General, the District of Columbia, Hawaii, and Maine each filed individual suits against Purdue the same day.

These states join more than 40 others, including hard-hit Ohio and West Virginia, and about 2,000 local and tribal governments, that have already filed lawsuits against Purdue for fueling the opioid epidemic.

However, these newest states seem to be way behind the litigation curve, as other states have been in litigation for years, and one is currently in one of the first trials.

Oklahoma was the first state to announce major settlements this year, and kicked off the first trial in May against remaining defendants. In March, Purdue Pharma, the maker of OxyContin, agreed to a $270 million settlement with the state.

And then Teva announced an $85 million settlement with the state of Oklahoma over its alleged role in fueling the opioid crisis. Trial is currently in progress against a remaining defendant Johnson & Johnson.

The California lawsuit alleges that Purdue’s illegal and misleading marketing and sales practices played a major role in contributing to the nationwide opioid crisis. It further alleges that Purdue created a public nuisance through its marketing and sale of opioids and misled healthcare professionals and patients about the addictive nature of opioids and their potential for abuse and diversion.

What is missing from the California suit are the other traditional defendants. Most other suits include other opioid manufacturers such as Endo Pharmaceuticals, and Johnson & Johnson’s Janssen Pharmaceuticals, among others,

Also missing from the California litigation are distributors – including Amerisource Bergen, McKesson Corp., and Cardinal Health (known as the “Big Three”) – who allegedly distributed more than 80 percent of the opioids at issue and failed to monitor, investigate, refuse, or report suspicious orders of prescription opioids, flooding states with the drugs.

The State Compensation Insurance Fund will test out new software that lets them provide authorizations for patient treatments in real-time – through their electronic medical records – rather than waiting several days for decisions to come via fax.

The article in the Sacramento Bee reports that Dr. Dinesh Govindarao, chief medical officer for the State Compensation Insurance Fund, said his agency decided to fund development of the software because leaders wanted to get care approved faster for injured workers.

Although State Fund developed the new software, known as UR Connected, Govindarao said, it is something they believe could benefit any workers’ comp insurer, and he is hoping that other insurers will want to adopt it.

UR Connected integrates with and leverages existing information systems in the medical providers’ offices, so neither the providers nor their staff have to go offline and fill out paperwork to request approvals for patient treatment, said J.R. Long, an executive with Conexia, the software company that developed UR Connected for State Fund.

“If the system is more efficient and patient care is rendered faster, then folks are hopefully getting back to work sooner, and that will then really reduce indemnity cost (for disability pay),” Govindarao said, “and also if care is not being delayed, hopefully even medical costs will go down because they’re getting care faster and there’s maybe less risk of complications.”

Govindarao said: “What we wanted to do was change that up, so in real time, the physician who is requesting that, they would right then and there get a response: Either yes, go ahead and treat, or we need to escalate this for utilization review.”

With UR Connected, Govindarao said, evidenced-based medical procedures would get approved while patients are still in the exam room if State Fund covers them, and requests that require utilization review will be sent to the appropriate personnel more quickly.

Long added: “You’re able to manage by exception, so the things you need to get involved in, you can put your resources toward that as opposed to the events or activities that today are happening in this…manual fashion. You can redirect those staff to more value-added activities both for the insurer and ultimately for the provider and the patient.”

Stuart Sweetser, who works in State Fund’s medical claims division, said that, as the technology gets more widely adopted, some of State Fund’s staff will get different assignments but that State Fund does not foresee any layoffs.

Govindarao said that “the manual tasks probably will never go away. For that to happen, we’d have to have 100 percent adoption with every provider out there, which I think is probably not going to happen. But I think, if we have over 70-80 percent as a target, down the road.”

State Fund is paying Conexia to help ensure the UR Connected system can be smoothly adapted to the various information systems that doctors, hospitals and other types of medical practitioners use, Govindarao said, and they hope to get large groups and high-volume practitioners set up with the system soon.

If providers aren’t ready to integrate their information systems with UR Connected, Govindarao said, they have the option of going through a website portal to request approvals for treatments. The plan, he added, is to also integrate with bill payment to try and get practitioners paid faster.

The controversial proposed law, A.B. 5 was passed by the California Assembly on May 29 and has now been moved to the Senate.

The law is an act to add Section 2750.3 to the Labor Code. It would state the intent of the Legislature to codify the decision in the Dynamex case and clarify its application. The bill would provide that the factors of the “ABC” test be applied in order to determine the status of a worker as an employee or independent contractor for all provisions of the Labor Code and the Unemployment Insurance Code, unless another definition or specification of “employee” is provided.

Many self-employed workers and business owners urged California lawmakers to expand the bill, allowing more gig workers to be exempted from employee status.

Those seeking an expansion of the legislation want a variety of other workers exempted, including architects, engineers, lawyers, real estate agents, therapists, accountants, barbers, hair stylists and others who have advanced degrees, are licensed by the state or simply want to remain independent contractors.

California is estimated to have nearly 2 million residents who choose to work as independent contractors, according to the U.S. Bureau of Labor Statistics, and that doesn’t count people who supplement their income through online work.

The bill as it is now written, appears to have responded to certain groups seeking to remain independent. It would now exempt specified professions from these provisions and instead provide that the employment relationship test for those professions shall be governed by the test adopted in S. G. Borello & Sons, Inc. v. Department of Industrial Relations (1989) 48 Cal.3d 341 if certain requirements are met.

These exempt professions would include licensed insurance agents, certain licensed health care professionals, registered securities broker-dealers or investment advisers, a direct sales salesperson, real estate licensees, workers providing hairstyling or barbering services, and those performing work under a contract for professional services.

The bill would require the State Board of Barbering and Cosmetology to promulgate regulations for the development of a booth rental permit and a reasonable biennial fee upon workers providing specified hairstyling or barbering services, by no later than July 1, 2021.

If the bill becomes law, on-demand tech companies are expected to challenge it in court, as they have built their businesses on the independent-contractor model. The law also is opposed by small-business groups, which say it would crush business to classify certain workers as employees. And some independent contractors say they’re already feeling the brunt of the California Supreme Court decision, which has led some news outlets to stop commissioning freelancers because they fear breaking the law.

Two defendants entered no contest pleas to attempting to defraud multiple insurers of approximately $120,000 by having students sign over their Supplement Job Displacement vouchers and collecting the money without providing required vocational training.

Salvador Franco, Jr., 42, of Downey and Mirella Flores, 45, of Paramount were each charged with one felony count of conspiring to commit a crime, 18 felony counts of making a fraudulent statement to obtain or deny compensation, and 18 felony counts of fraudulent claims. On May 24, 2019, both defendants accepted a court offer and pled no contest to all counts.

Franco and Flores were immediately sentenced to three years of formal probation and ordered to pay $88,000 in restitution to insurers and $62,000 in investigative costs to the California Department of Insurance. The defendants were also sentenced to 90 days in Orange County Jail, however this was stayed pending the completion of 275 hours of community service by Franco and 250 hours by Flores.

Between 2015 and 2017, Franco and Flores participated in an alleged Supplemental Job Displacement Voucher Fraud scheme involving the Technical School, Inc., doing business as Technical College, Inc., and Graduates Do Succeed Institute, doing business as GDS Institute. Franco was a 20 percent owner and a Director of Technical College as well as its Chief Financial Officer. He was also the Chief Financial Officer of GDS Institute. Flores was an employee for both schools.

The defendants conspired and offered to provide workers’ compensation claimants with either at-home or off-site training for a few hours a week along with work related materials such as a computer. In exchange, claimants were expected to sign over their Supplement Job Displacement Vouchers that were valued between $4,000 and $10,000. Other students were offered a monetary payment in exchange for signing over their vouchers and not attending any training.

The enrollment materials allegedly sent to insurers for payment on the vouchers, however, vastly misrepresented the training that the claimants were going to receive. Instead of listing the at-home training, the provision of supplies, or the kickbacks to the students, defendants described the training as being several hundred hours in length, requiring full-time (40 hours per week) attendance at one of the schools’ campuses.

Compwest Insurance Company was alerted to the alleged fraudulent scheme by a claimant living in Orange County who did not receive the promised in-home training from Technical College. Compwest then notified both OCDA and the California Department of Insurance, who agreed to jointly investigate the complaint. Shortly thereafter, the Los Angeles District Attorney’s Office joined the investigation.

Deputy District Attorney Steven Schriver of the Insurance Fraud Unit prosecuted this case.