Tag: 2019 News

The Workers’ Compensation Insurance Rating Bureau of California (WCIRB) released the 2019 WCIRB Geo Study, which underscores regional differences in claim characteristics across California. The web-based interactive map allows you to quickly view key measures across regions.

The study’s key findings include the following:

— Even after controlling for regional differences in wages and industrial mix, indemnity claim frequency is significantly higher in the Los Angeles Basin and significantly lower in the San Francisco Bay Area.

— Regional differences in indemnity claim frequency have been fairly consistent over time and across industries. The LA/Long Beach region has had the highest frequency, and the Peninsula/Silicon Valley region has had the lowest frequency during all available years. The difference between these regions has grown in each of the last two years. Since 2013, the largest improvement in relative indemnity claim frequency is in the Fresno/Madera region, and the greatest deterioration has been in Orange County and the Imperial/Riverside region.

— Regional differences in severity are more muted than in frequency. Even after controlling for regional differences in industrial mix, limited average incurred on indemnity claims is highest in the San Luis Obispo, Santa Barbara and Ventura regions and lowest in the San Bernardino/West Riverside region.

— Pharmaceutical costs throughout the state have dropped dramatically over the last several years, and the prevalence of opioid prescriptions for claims with pharmaceutical payments has also dropped dramatically. The largest decreases in pharmaceutical costs have occurred in Southern California regions, which had the highest pharmaceutical spending at the beginning of the study period. This has decreased the differences in pharmaceutical costs across regions over time.

— The share of cumulative trauma claims as a percent of all claims is much higher in the Los Angeles Basin than in other parts of the state, and that gap has generally widened over time.

— Both medical-legal costs and paid allocated loss adjustment expenses (ALAE) are significantly higher in the Bakersfield and Los Angeles Basin regions than in the remainder of the state.

— The share of open indemnity claims has decreased substantially in all regions since 2013. The largest decreases have been experienced in the Los Angeles Basin regions that had the highest initial open indemnity claim shares. These changes have narrowed regional differences over time.

— Incurred loss development regional differences observed were relatively modest. In general, development appeared higher than average in more urban areas, with the highest in the Los Angeles/Long Beach region and the lowest in the Fresno/Madera region.

When Vinay Prasad, MD, was a resident, strict control of blood glucose for patients in the intensive care unit was considered an important goal. “We really chased tight glycemic control in the medical ICU, but of course, just a few years later, a randomized control trial – NICE-SUGAR – came out showing that that actually led to net harm without benefit,” he said.

That’s just one example of a medical reversal, which occurs when new and superior research contradicts and supersedes existing clinical practice. It’s a phenomenon in which Dr. Prasad, an associate professor of medicine at Oregon Health & Science University and the author of Ending Medical Reversal: Improving Outcomes, Saving Lives, is an expert.

He and a team of colleagues from OHSU published a comprehensive review of randomized clinical trials in the Journal of the American Medical Association, The Lancet, and the New England Journal of Medicine identifying 396 medical reversals.

At least a dozen of these reversals related specifically to emergency medicine, while many others had at least some relationship to emergency care, trauma, and critical care. A few examples:

Mechanical chest compressions with the LUCAS device, in use since 2003 for treating patients in cardiac arrest, was found in the LINC randomized, controlled trial to have no significant effect on survival compared with manual CPR in patients with out-of-hospital cardiac arrest. The ability to achieve ROSC with the mechanical device was inferior to manual chest compression during resuscitation. (JAMA. 2014;311[1]:53)

Early and aggressive intervention with the early goal-directed therapy (EGDT) protocol for ED patients in whom sepsis is suspected was widely adopted after one positive study in 2001. It was later found to confer no added survival benefit compared with usual care and to contribute to increased ICU resource utilization. (JAMA. 2017;318[13]:1233)

The REACT-2 trial found that routine use of an immediate total-body CT scan as part of trauma workup did not reduce in-hospital mortality compared with conventional imaging and selective CT scanning in patients with severe trauma. (Lancet. 2016;388[10045]:673)

Platelet transfusion after acute hemorrhagic stroke associated with antiplatelet therapy was a common practice in the ED (as well as in neurosurgery and stroke units), but the 2015 PATCH study found worsened survival in the platelet transfusion group (68%) compared with the standard care group (77%). (Lancet. 2016;387[10038]:2605)

A spinal surgeon was sentenced to 30 months in federal prison for participating in a long-running health care fraud scheme in which he received at least $5 million in kickbacks for performing hundreds of spinal surgeries. The overall scheme resulted in more than $580 million in fraudulent bills being submitted, mostly to California’s worker compensation system.

Dr. Daniel Capen, 70, of Manhattan Beach, was sentenced by United States District Judge Josephine L. Staton, who also ordered Capen to forfeit $5 million to the United States and pay a $500,000 fine.

Capen, an orthopedic surgeon specializing in spinal surgeries, pleaded guilty in August 2018 to conspiracy to commit honest services fraud, and soliciting and receiving kickbacks for health care referrals.

The kickback scheme centered on Pacific Hospital in Long Beach, which specialized in surgeries, especially spinal and orthopedic procedures. Pacific Hospital’s owner, Michael D. Drobot, conspired with doctors, chiropractors and marketers to pay kickbacks in return for the referral of thousands of patients to Pacific Hospital for spinal surgeries and other medical services paid for primarily through the California workers’ compensation system.

Capen received kickbacks for referring surgeries to Pacific Hospital and also for using medical hardware from a Pacific Hospital-affiliated entity during the spinal surgeries he performed. He also received kickbacks for referring medical services such as urine and drug testing to Pacific Hospital-affiliated entities.

In total, between 1998 and 2013, Capen accounted for approximately $142 million of Pacific Hospital’s claims to insurers, on which the hospital was paid approximately $56 million. Capen admitted to receiving at least $5 million in kickbacks during the course of his crimes.

Drobot is serving a five-year prison sentence for conspiracy and paying illegal kickbacks, and has admitted that he orchestrated a wide-ranging fraudulent kickback scheme where paid more than $50 million in bribes to doctors to steer hundreds of millions of dollars in spinal surgeries to his hospital. Drobot ultimately profited millions of dollars from the scheme. Drobot currently faces additional federal criminal charges for allegedly violating a court forfeiture order by illegally selling his luxury cars.

Seventeen defendants have been charged in connection with the scheme, and 10 of them have been convicted, including Drobot and his son. Another doctor – Timothy James Hunt, 55, of Palos Verdes Estates – was sentenced in late September to two years in federal prison after he admitted taking illegal kickbacks.

The investigation into the spinal surgery kickback scheme was conducted by the FBI; IRS Criminal Investigation; the California Department of Insurance; and the United States Postal Service, Office of Inspector General.

This case is being prosecuted by Assistant United States Attorneys Joseph T. McNally of the Violent and Organized Crime Section, Scott D. Tenley of the Santa Ana Branch Office, Ashwin Janakiram of the Major Frauds Section, and Victor A. Rodgers of the Asset Forfeiture Section.

Deville worked at Exide’s hazardous waste treatment and storage plant in Vernon for 29 years. At that location, Exide recycled automotive batteries, which recovered the lead used in the batteries. Deville was a forklift driver and furnace operator.

On April 24, 2013, the Department of Toxic Substance Control (DTSC) ordered Exide to suspend operations in Vernon because plant operations were causing discharge of illegal amounts of lead into the air, water, and soil.

Before operations at Exide’s Vernon facility were halted, Deville experienced what he calls two “profound” health-related incidents at work. On one occasion, Deville lost consciousness while cleaning one of the facility’s furnaces. On the second occasion, which also arose in connection with cleaning one of the furnaces, Deville felt dizzy, left the furnace, and went to a restroom where he produced a urine stream that he says was black in color.

In June 2016, more than three years after these two alleged incidents and suspension of operations at Exide’s Vernon plant, Deville sued Exide and certain Individual Defendants, alleging unspecified injuries caused by exposure to lead and other hazardous chemicals while working at the Vernon facility.

Deville alleged he was injured by defendants’ collective failure to properly use and store hazardous and toxic substances at the Vernon plant, to disclose fully and accurately the risks presented to human health presented by the chemicals used at the plant, to remediate or clean up contaminants, and to provide proper safety equipment and training.

The Individual Defendants argued, among other things, that all of Deville’s claims were precluded by workers’ compensation exclusivity principles. The trial court sustained the Individual Defendants’ demurrer without leave to amend.

Exide separately demurred to the operative complaint, making the same workers’ compensation exclusivity argument (among others) on which the Individual Defendants had prevailed. The trial court sustained Exide’s demurrer without leave to amend and dismissed the case.

The dismissals were affirmed in the unpublished case of Deville v. Bloch.

The Individual Defendants’ demurrer was properly sustained without leave to amend because the operative complaint alleges the Individual Defendants were acting within the scope of their employment and did not allege any facts that would satisfy the two exceptions to workers’ compensation exclusivity rules when individual defendants (as opposed to an employer) are sued.

Similarly, Exide’s demurrer to the bulk of Deville’s claims was properly sustained because the operative complaint does not adequately allege facts establishing any of the elements of the fraudulent concealment of injury exception to workers’ compensation exclusivity on which Deville relies to maintain his action.

In separate incidents, Miguel Velazquez and Servando Velazquez suffered injuries, and each required Spanish language interpreting services in connection with their medical care. Meadowbrook was the carrier for the claimants’ employers and accepted both claims and administered benefits.

DFS Interpreting, provided interpreter services to each claimant, and timely submitted invoices to Meadowbrook. Meadowbrook issued explanations of review pursuant to Labor Code section 4603.3, explaining that it refused to pay the invoices DFS submitted.

DFS objected to those explanations of review, but did not request a second review pursuant to section 4603.2, subdivision (e) or California Code of Regulations, title 8, section 9792.5.5.

After each underlying case resolved, the cases were consolidated to determine whether DFS properly contested Meadowbrook’s explanations of review, and, if not, whether to award further payment to DFS. The parties stipulated that the interpreters were necessary at all medical treatment appointments, DFS timely submitted the invoices, Meadowbrook timely issued the explanations of review, and DFS objected to the explanations of review but did not request a second review.

The WCJ issued her findings and award and order in favor of DFS, and found that the liens were not barred by its failure to request a second review, because the administrative director had not adopted a fee schedule pursuant to section 4600, subdivision (g).

The WCAB denied the reconsideration petition. It reasoned that the AD had not specifically adopted a fee schedule for interpreters after the Legislature enacted Senate Bill No. 863. Thus, there was not an applicable fee schedule and DFS was not required to submit a request for second review.

The Court of Appeal reversed in the published case of Meadowbrook v WCAB.

The AD adopted Title 8, section 9795.3, entitled “Fees for Interpreter Services” in 1994. The section also describes interpreter fees that “shall be presumed to be reasonable.”

There is no requirement that the AD adopt a fee schedule after Senate Bill No. 863 was enacted. Title 8, section 9795.3 is an applicable fee schedule as required by the labor code and regulations.The parties offer no authority establishing that the schedule of fees set out in Title 8, section 9795.3 is not a “fee schedule” such that it qualifies as such under the relevant regulation.

“Because the fee schedule set out in Title 8, section 9795.3 is an “applicable fee schedule” as required by Title 8, section 9792.5.4, we hold that DFS’s liens are barred by its failure to request a second review. Because the WCAB’s interpretation of the law is clearly mistaken, the WCAB’s opinion and decision on reconsideration must be annulled.”