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Tag: 2019 News

WCIRB Publishes California Terrorism Risk Assessment

The WCIRB has released the Workers’ Compensation California Terrorism Risk Assessment study that was developed in partnership with Risk Management Solutions, Inc. (RMS), a leading provider of catastrophe modeling analytics.

RMS conducted a California terrorism risk assessment for the WCIRB to determine the proportion of workers’ compensation loss payable that is covered by insurers, the US government, and retained by the policyholders under the US Terrorism Risk Insurance Program Reauthorization Act (TRIPRA) for calendar year 2019. RMS quantified total workers’ compensation losses using an analysis of exposure data from member companies of the WCIRB.

RMS quantified total workers’ compensation losses using an analysis of exposure data from member insurers of the WCIRB. The study is based on data provided by the WCIRB and compiled using RMS terrorism exposure assessment models. The WCIRB portfolio contains the policy and exposure data for $544 billion of business payroll insured by members of the WCIRB.

Terrorism risk is very concentrated in nature and often varies significantly over small geographic areas. The resolution of address data is therefore very important in determining a location’s proximity to targets, hazard level, and financial impact, given a terrorist attack occurs. The quantification of terrorism risk, as a result, is greatly dependent on the detail and positional accuracy of the underlying exposure data

Based on an attack catalog drawing from approximately 60,000 terrorism events, RMS analysis suggests that there is a 9.5% probability of triggering the TRIPRA program (or exceeding $180 million for all TRIPRA eligible lines of business). This should not be interpreted as a 1-in-10 chance of terrorist attack. Instead, it indicates that the methodology used to generate the exceedance probability curve considers events which are very severe but unlikely due to pervasive counter- security measures.

Without TRIPRA, the estimated average annual loss is $27.9 million. With TRIPRA, the estimated average annual loss retained by WCIRB member insurers is $21 million, which corresponds to an average loss rate per full time equivalent employee of $1.85 and an average loss rate per $100 of payroll of $0.0039.

Exposure is highest in the Los Angeles-Long Beach-Anaheim Metropolitan Statistical Area (MSA), accounting for about 35% of the portfolio’s total FTE. The San Francisco-Oakland-Hayward MSA and the San Jose- Sunnyvale-Santa Clara MSA consist of 17% and 11%, respectively, of the portfolio’s exposure. Together, these three metropolitan areas make up about 63% of WCIRB’s exposure.

Terrorism is an urban risk, predominantly in areas where there are large concentrations of people and business activity. Although Los Angeles has the highest overall exposure, the largest concentration of exposure for a 400-meter radius lies in the main central business district in San Francisco, also known as the financial district.

Due to the high density of exposure and potential terrorist targets in the city, San Francisco generates the highest estimated average annual losses in California with an excess of $12 million in estimated average annual losses retained by insurers under the 2019 TRIPRA.

New Brown Appointments on Last Days in Office

January 4 marked Gov. Jerry Brown’s last day living in the Governor’s Mansion in downtown Sacramento. In his last few days in office, he made numerous appointments to various administrative positions, some of which pertain to the worker’s compensation industry.

48 year old Craig L. Snellings who lives in Oakland, has been appointed to the California Workers’ Compensation Appeals Board. Snellings has been house counsel for Farmers Insurance since 2014. He was a workers’ compensation insurance defense attorney at Shaw, Jacobsmeyer, Crain and Claffey from 2012 to 2013, at Mullen and Filippi from 2005 to 2006 and at Adelson, Testan, Brundo, Novell and Jimenez from 2004 to 2005. Snellings served as staff counsel at the State Compensation Insurance Fund from 2006 to 2012 and from 2002 to 2004. He is a member of the Oakland Bench and Bar Committee and the Charles Houston Bar Association. Snellings earned a Juris Doctor degree from the University of California, Los Angeles School of Law. This position requires Senate confirmation and the compensation is $153,689. Snellings is a Democrat.

Christine Baker, 69, of Berkeley, has been appointed to the Fraud Assessment Commission. She was director of the Department of Industrial Relations from 2012 to 2018, where she served as chief deputy director from 2011 to 2012. Baker was executive officer of the Commission on Health and Safety and Workers’ Compensation from 1994 to 2011. She was acting deputy director at the Department of Industrial Relations’ Division of Workers’ Compensation from 1990 to 1994 and chief of the Department’s Division of Labor Statistics and Research from 1984 to 1989. Baker was a research assistant at the University of California, Berkeley from 1980 to 1982. This position does not require Senate confirmation and the compensation is $100 per diem. Baker is a Democrat.

Sean McNally, 62, of Bakersfield, has been reappointed to the Commission on Health and Safety and Workers’ Compensation, where he has served since 2007. McNally has been president of KBA Engineering since 2013. He was vice president of human resources and government affairs at Grimmway Farms from 1997 to 2013, partner and attorney at Hanna, Brophy, MacLean, McAleer, and Jensen from 1991 to 1997 and was an independent general contractor doing residential real estate development from 1984 to 1990. McNally was a municipal court deputy for the Kern County District Attorney’s Office from 1983 to 1984. This position does not require Senate confirmation and the compensation is $100 per diem. McNally is registered without party preference.

Christine Bouma, 52, of Sacramento, has been reappointed to the Commission on Health and Safety and Workers’ Compensation, where she has served since 2012. Bouma has been president of Capitol Connection since 2000, representing firefighters and other public sector workers. She was a mathematics and computer science teacher for the Hesperia Unified School District from 1989 to 1999 and an instructor at Victor Valley Community College from 1991 to 1998. She has been president of the Institute of Governmental Advocates since 2015. This position does not require Senate confirmation and the compensation is $100 per diem. Bouma is a Democrat.

Doug Bloch, 49, of Oakland, has been reappointed to the Commission on Health and Safety and Workers’ Compensation, where he has served since 2012. Bloch has been political director at Teamsters Joint Council 7 since 2010. He was the Port of Oakland campaign director for Change to Win from 2006 to 2010 and a senior research analyst at Service Employees International Union Local 1877 from 2004 to 2006. Bloch was statewide political director at the California Association of Community Organization for Reform Now from 2003 to 2004 and ran several ACORN regional offices, including Seattle and Oakland, from 1999 to 2003. He was an organizer at the Non-Governmental Organization Coordinating Committee for Northeast Thailand from 1999 to 2003. This position does not require Senate confirmation and the compensation is $100 per diem. Bloch is a Democrat.

Owners of San Ramon Companies Face 14 Felonies

The Mercury News reports that three members of a respected San Ramon business family have been accused of engaging in money laundering, bribing employees, and insurance fraud, all while their companies were contracting with the U.S. Armed forces.

Wife and husband Selina Singh, 55, and Manjinder Paul “MP” Singh, 57, along with their son, Kabir Singh, 28, were charged in November with conspiracy, $1.5 million in money laundering and several counts of workers compensation fraud and insurance fraud, according to court records. The charges are tied to two San Ramon businesses owned by the family, Bara Infoware and Federal Solutions Group.

Selina and Kabir Singh have both posted bail, and are out of custody. MP Singh has not yet been arrested, prosecutors said. On Monday, a judge will review a prosecution motion to increase the bail amount to $500,000.

The charging documents allege that the defendants instructed employees not to report injuries, sometimes giving them bribes as an incentive, in order to avoid paying insurance premium. They’re also accused of providing false information to insurance companies.

Both companies are construction businesses that contract with the Department of Defense, according to the companies’ websites. Federal Solutions Group’s website says its clients include the U.S. Armed Services, the Federal Bureau of Prisons, the National Guard, and the U.S. Army Corps of Engineers.

A 2016 article by a business news site called American City Business Journals says Singh is Federal Solution’s Group’s CEO. She is quoted in the article saying she immigrated to the United States from Northern India and had no business experience in the U.S. when she started. She talked about the need for obsessive attention to detail in her field.

A former manager at Federal Solutions Group is quoted in the story saying Singh “takes care of her employees.”

The Contra Costa District Attorney’s office filed 14 felony charges, including enhancements alleging aggravated white-collar crime.

Physician Online Patient Portals Mostly Unused

Most people in the U.S. with health insurance don’t use the patient portals that are increasingly provided by doctors for online communication, a new study suggests. In a nationally representative survey, researchers found that nearly two-thirds of insured participants had not used an online medical portal in the past year.

Disparities among those who said they’d been offered portal use, and among those who chose to use it, suggest this technology can become a source of unequal access to healthcare, the study team writes in Health Affairs.

“Previous research has shown there are real benefits to portal use. Patients become more engaged in their own health and really stick to their treatments,” said senior author Denise Anthony of the University of Michigan in Ann Arbor.”However, new treatments in health care, and new technologies in general, can end up increasing inequality,” she told Reuters Health by email.

Anthony and her colleagues analyzed data on 2,325 insured patients who participated in the 2017 Health Information National Trends Survey and who had a medical visit during the year before the survey. The researchers wanted to understand the characteristics of portal users and nonusers and the reasons, such as technology issues or security concerns, why many patients don’t use online sites to access their medical records.

Overall, 63 percent of survey participants reported not using a patient portal during the past year, and 60 percent reported not having been offered access to a portal.

Nonusers were more likely to be men, aged 65 or older, to be unemployed, live in a rural location, have public insurance through Medicaid, have a high school diploma or less education and to lack a regular doctor. Similar characteristics, as well as being non-white, were seen among people who said they weren’t offered access to a patient portal.

Among the reasons participants gave for not using online portals, 25 percent mentioned issues with internet access, 32 percent said they had no online medical record, 70 percent said they preferred to speak directly to the doctor, and 22 percent were concerned about privacy issues.

“We also know from our previous research that privacy concerns can affect patients’ relationships with physicians, including how they communicate and trust their doctors, so these concerns are important beyond portals,” Anthony said.

“The underlying assumption is generally a ‘Build it and they will come’ mentality about technology, but this study gives great perspective about both who is offered/using the portal as well as why certain groups experience barriers,” said Courtney Lyles of the University of California, San Francisco, who wasn’t involved in the study.

“Everyone is generally interested in online tools to make life more convenient, but we can’t separate that from the skills and relationships that surround technology use,” she told Reuters Health by email.

Future studies should consider the role of digital inclusion and digital literacy, Lyles added. Doctors will need to do more to help patients use portals during visits, as well as connecting them to resources for digital support such as local libraries and community groups.

Professional Athletes Continue Claims Pursuit

In 2018 the NFL, NHL concussion fights continued to play out in courts across the nation. It is likely that 2019 will be more of the same. An unofficial part of the playbook for some professional sports teams is that players have been seeking workers compensation damages to cover their long-term injuries from rough and tumble sports.

The National Hockey League in November announced a tentative $18.9 million settlement with 318 retired players who sued the league, accusing it of failing to protect them from head injuries or warning them of the risks involved with playing.

The settlement includes up to $75,000 for medical treatment and a potential cash payment of about $23,000 a player. It also includes the promise of a “Common Good Fund” to help other players with head injuries.

Meanwhile, a federal judge in August dismissed a retired NHL player’s lawsuit against Chubb Ltd. and two NHL teams over a technicality: lack of jurisdiction.

Last year, Mike Peluso, a former “enforcer” for the New Jersey Devils and St. Louis Blues in the 1990s, sued the teams and Chubb, which wrote the workers compensation policy that covered Mr. Peluso. He alleged that the defendants had failed to disclose medical information related to workers comp claims for head trauma and brain disease. He also claimed that he had been inadequately warned of his risk of further brain injury and of his fitness to continue playing hockey after suffering a concussion and later suffering a grand mal seizure.

All this followed the dismissal of a wrongful death lawsuit in May brought against the NHL for the death of player Derek Boogaard.

Boogaard was a professional hockey player in the NHL. The suit claimed team doctors repeatedly prescribed him pain pills relating to various injuries and procedures and he became addicted to those pills by 2009. He was placed into the league’s substance abuse and behavioral health program and checked into a California rehabilitation facility for in-patient treatment of his opioid and sleeping-pill addictions. He accidentally overdosed and died at age 28, according to court documents.

As for the National Football League, a California appellate judge ruled a former Indianapolis Colts player and California resident Larry Triplett,cannot file a workers compensation claim in the state because there’s no proof he signed his contract while in California and that he only played two games there over a six-year career.

As can be seen, the professional athletes have had mixed litigation results in 2018. Yet stakeholders say that there yet could still be a tidal wave of individual lawsuits from players seeking care for head injuries they claim arose from the league’s long-time promotion of violence.

Study Finds 20% Annual Health Crimes Increase

Limited information exists on the characteristics of US physicians who have been excluded from Medicare and state public insurance programs for convictions of health care fraud, crimes related to health care delivery, or substance abuse.

Common fraud schemes include billing for services not rendered, filing duplicate claims (including the unbundling of bundled services), and misrepresenting dates and locations where services were provided. Health crimes involve the provision of medically unnecessary procedures, illegal patient admittance and retention practices, the making of false statements (including physician medical identify theft), and the gross violation of professionally recognized standards of care.

Researchers decided to to examine the characteristics of physicians excluded from Medicare and state public insurance programs for fraud, health crimes, or unlawful prescribing of controlled substances. Alice Chen, PhD, MBA, from the University of Southern California in Los Angeles, and colleagues conducted a cross-sectional study to examine the characteristics of physicians excluded from Medicare and state public insurance programs for fraud, health crimes, or unlawful prescribing of controlled substances between 2007 and 2017.

We found that the number of physicians excluded from participating in public health insurance has grown substantially over time and that excluded physicians were concentrated in specific regions of the United States,” the authors write.

The researchers found that 2222 physicians were temporarily or permanently excluded from Medicare and state public insurance programs during 2007 to 2017. On average, there was a 20% increase per year in fraud, health crimes, and substance abuse exclusions (from 236 convictions in 2007 to 670 in 2017). Researchers found the highest exclusion rates in the West and Southeast. The state with the highest exclusion rate was West Virginia, with 5.77 exclusions per 1000 physicians, while there were no exclusions in Montana. Exclusions were more likely for male physicians, physicians with osteopathic training, older physicians, and physicians in specific specialties.

Physicians in the West and Southeast were most likely to be excluded for fraud, substance abuse, or health crimes. Although California, New York, Florida, and Texas had the highest absolute counts of excluded physicians from 2007 to 2017, they also had the largest physician populations.

When considering the rate of physician exclusions per 1000 physicians, only Florida remained in the highest category of exclusion rates. West Virginia had the highest exclusion rate, with 5.77 exclusions per 1000 physicians (32 exclusions among 5720 physicians), while Montana had 0 exclusions during this period.

There were several explanations for the observed increase in exclusions, and rates of identified health care fraud, waste, and abuse. First, this finding could be evidence that regulators, who have been aided by recent public policies targeting the reduction of fraud and waste, may be getting better at identifying perpetrators of fraudulent activity.

Physician exclusions were more common in certain states in the West and Southeast. Many of these regions had Medicare Fraud Strike Force Teams, which were established in “hot spots” of unexplained high Medicare billing levels (Florida, California, Michigan, Texas, New York, Louisiana, Florida, and Illinois as of 2017).

In addition, the growth in physician exclusions could also be due, at least in part, to growth in the total number of US physicians participating in public insurance.

New OMFS Changes Effective January 1

The Division of Workers’ Compensation has posted an order adjusting the Durable Medical Equipment, Prosthetics, Orthotics and Supplies (DMEPOS) section of the Official Medical Fee Schedule to conform to the 2019 changes in the Medicare payment system as required by Labor Code section 5307.1.

The update includes changes identified in Center for Medicare and Medicaid Services Change Request (CR) number 11064.

The order, which is effective for services on or after January 1, 2019, adopts the Medicare DMEPOS fee schedule first release for calendar year 2019.

It has also posted an order adjusting the pathology and clinical laboratory section of the Official Medical Fee Schedule.

The pathology and clinical laboratory fee schedule update order adopts the following Medicare change: – CY 2019 Q1 Release: Revised for January 2019 (19CLABQ1)

The orders adopting these changes can be found on the DWC website.

First Comp Providers Finally Join Opioid Lawsuits

Two Illinois-based nonprofit risk pools, who provide more than 203 local municipalities and other public entities with workers’ compensation and employee healthcare insurance, filed a joint lawsuit in the Circuit Court of Cook County against leading opioid manufacturers, distributors, professional associations, and prescribers. It is the first opioid lawsuit brought by insurance risk pools in Illinois.

The Intergovernmental Risk Management Agency (IRMA) and Intergovernmental Personnel Benefit Cooperative (IPBC), seek injunctive relief and financial compensation from defendants to recoup substantial costs resulting from the far-reaching impact of the over-prescription and abuse of opioid medication. IPBC’s costs include vast expenditures on hospitalizations due to overdose, addiction treatment services, and overdose reversal medications, while IRMA has paid millions of dollars in cases involving injured workers who were unnecessarily given long-term opioid prescriptions to treat chronic pain.

The suit alleges opioid manufacturers, including Purdue Pharma, Allergan, and Teva, engaged in aggressive and deceptive marketing campaigns; distributors including AmerisourceBergen, Cardinal Health, and McKesson failed to act as gatekeepers against overprescribing the addictive narcotics; professional organizations including Chicago-based American Academy of Pain Medicine and American Pain Society deceptively promoted the use of opioids for chronic pain management; and suburban Chicago doctors Paul Madison and Joseph Giacchino served as “pill mills,” doling out opioids to anyone who came through the door of their clinic.

The 217 page civil complaint  alleges that the defendants’ plan to flood the Illinois market with opioid medication worked: in 2015, eight million opioid prescriptions were filled in Illinois, the equivalent of 60 prescriptions per 100 people.

The lawsuit is the latest step in a proactive multi-pronged strategy IPBC and IRMA have enacted to address and reduce opioid abuse in their members’ employee communities.

“This lawsuit is about real costs incurred directly as a result of the opioid epidemic. We have seen fully employed, respectable public employees with work injuries who were prescribed opioids unnecessarily and became addicted, ultimately rendering them unable to return to work and costing our members millions,” said IRMA Executive Director Margo Ely. “Opioid abuse and addiction has cost our members through not only lost productivity, but very sad stories of lost careers and lives.”

“As a taxpayer-supported health insurance provider to public entities across Illinois, we have a fiduciary obligation to aggressively seek to recoup the millions of dollars in claim costs that have been wasted due to over-prescription of opioid medications and addiction treatment,” said IPBC Executive Director Dave Cook. “The impact of long-term opioid use and abuse has been significant to our organization financially, and to many of our members who have suffered as a result of defendants’ egregious behavior.”

Founded in 1979, the Intergovernmental Risk Management Agency (IRMA) was the first municipal risk pool in Illinois, and today, provides comprehensive risk management services, including workers’ compensation coverage, for 72 municipal groups in northeastern Illinois.

The Intergovernmental Personnel Benefit Cooperative (IPBC) is a public risk entity pool established in 1979 by Chicago area municipalities to administer some or all of the personnel benefit programs offered by participating members to employees and retirees.

First Comp Providers Finally Join Opiod Lawsuits

Two Illinois-based nonprofit risk pools, who provide more than 203 local municipalities and other public entities with workers’ compensation and employee healthcare insurance, filed a joint lawsuit in the Circuit Court of Cook County against leading opioid manufacturers, distributors, professional associations, and prescribers. It is the first opioid lawsuit brought by insurance risk pools in Illinois.

The Intergovernmental Risk Management Agency (IRMA) and Intergovernmental Personnel Benefit Cooperative (IPBC), seek injunctive relief and financial compensation from defendants to recoup substantial costs resulting from the far-reaching impact of the over-prescription and abuse of opioid medication. IPBC’s costs include vast expenditures on hospitalizations due to overdose, addiction treatment services, and overdose reversal medications, while IRMA has paid millions of dollars in cases involving injured workers who were unnecessarily given long-term opioid prescriptions to treat chronic pain.

The suit alleges opioid manufacturers, including Purdue Pharma, Allergan, and Teva, engaged in aggressive and deceptive marketing campaigns; distributors including AmerisourceBergen, Cardinal Health, and McKesson failed to act as gatekeepers against overprescribing the addictive narcotics; professional organizations including Chicago-based American Academy of Pain Medicine and American Pain Society deceptively promoted the use of opioids for chronic pain management; and suburban Chicago doctors Paul Madison and Joseph Giacchino served as “pill mills,” doling out opioids to anyone who came through the door of their clinic.

The 217 page civil complaint  alleges that the defendants’ plan to flood the Illinois market with opioid medication worked: in 2015, eight million opioid prescriptions were filled in Illinois, the equivalent of 60 prescriptions per 100 people.

The lawsuit is the latest step in a proactive multi-pronged strategy IPBC and IRMA have enacted to address and reduce opioid abuse in their members’ employee communities.

“This lawsuit is about real costs incurred directly as a result of the opioid epidemic. We have seen fully employed, respectable public employees with work injuries who were prescribed opioids unnecessarily and became addicted, ultimately rendering them unable to return to work and costing our members millions,” said IRMA Executive Director Margo Ely. “Opioid abuse and addiction has cost our members through not only lost productivity, but very sad stories of lost careers and lives.”

“As a taxpayer-supported health insurance provider to public entities across Illinois, we have a fiduciary obligation to aggressively seek to recoup the millions of dollars in claim costs that have been wasted due to over-prescription of opioid medications and addiction treatment,” said IPBC Executive Director Dave Cook. “The impact of long-term opioid use and abuse has been significant to our organization financially, and to many of our members who have suffered as a result of defendants’ egregious behavior.”

Founded in 1979, the Intergovernmental Risk Management Agency (IRMA) was the first municipal risk pool in Illinois, and today, provides comprehensive risk management services, including workers’ compensation coverage, for 72 municipal groups in northeastern Illinois.

The Intergovernmental Personnel Benefit Cooperative (IPBC) is a public risk entity pool established in 1979 by Chicago area municipalities to administer some or all of the personnel benefit programs offered by participating members to employees and retirees.