Tag: 2023 News

In the California workers’ compensation system, experience rating is a merit rating system with the primary statutory goal of providing a direct financial incentive for employers to promote a safe workplace.

An experience modification, also called an X-Mod, compares the claims history of one employer to the average expected of other employers of similar size in the same industry. All things equal, an X-Mod greater than 100 percent increases the cost of an employer’s workers’ compensation insurance, while an X-Mod less than 100 percent decreases an employer’s premiums.

The key assumption underlying experience rating is that some employers will respond to significant experience rating events. Specifically, becoming experience-rated or experiencing changes in X-Mods, especially increases that cross the 100 percent threshold, is assumed to incentivize employers to address emerging work-related hazards to lower premiums and promote a safer workplace.

However, there is limited research validating the efficacy of experience rating in promoting safety and reducing work-related injuries. Prior research tends to support the safety incentive of experience rating mostly based on aggregate injury data or using a proxy measure for the experience rating status of employers, but results were somewhat limited in scope and not always conclusive.

To further analyze the effectiveness of experience rating in reducing work-related injuries, the WCIRB conducted a study based on over a decade of employers’ loss and payroll experience and published X-Mods to evaluate the independent impacts of experience rating on work-related injuries. The study used regression modeling to better understand whether employers respond to significant experience rating events and take action to reduce work-related injuries.

Specifically, this study focused on two types of “shock” experience rating events that would potentially provide safety incentives to employers: an employer becoming initially qualified for experience rating and an increase in an employer’s X-Mod from below 100 percent to above 100 percent. This study also analyzed whether impacts of experience rating events vary by employer size and industry.

The key findings of the study include:

– – Qualification for experience rating led to a larger decline (-17%) in claim frequency for newly rated employers relative to non-rated employers of similar size and industry in the first year of experience rating. The impact on claim frequency persisted for the study period, three years after the first X-Mod was issued (Figure 4)
– – For experience-rated employers, an increase in X-Mods from credit (less than 100%) to debit (greater than 100%) is associated with a larger decline in the likelihood (-2%) of having any claims. The difference adjusts for employer size and industry sector and is statistically significant (Figure 5)
– – A credit-to-debit increase in X-Mods is also associated with larger declines in future claim frequency for experience-rated employers for three years after the X-Mod increase. The difference in claim frequency change is statistically significant and the difference grew to 8% by the third year after the X-Mod increase (Figure 6)
– – The construction, manufacturing and hospitality industries have a relatively high share of X-Mod eligible employers In these three industries, employers that had an increase in their X-Mods from credit to debit had a larger decrease in future claim frequency than other experience-rated employers whose X-Mods did not increase from credit to debit In particular, construction employers with an X-Mod increase had a larger decline (-15%) in claim frequency by the third year of the X-Mod change than other experience-rated construction employers of similar size (Figure 7)
– – The impact of a credit-to-debit X-Mod increase on future claim frequency varies by employer size While an X-Mod increase is associated with a larger decline in claim frequency for employers of all sizes, medium- sized employers1 appear to have the largest relative decline (-8%) in claim frequency (Figure 9)

The full report is available in the Research section of the WCIRB website.

GPT stands for Generative Pre-trained Transformer (GPT), a type of language model that uses deep learning to generate human-like, conversational text. GPT-4 is the newest version of OpenAI’s language model systems. Its previous version, GPT 3.5, powered the company’s wildly popular ChatGPT chatbot when it launched in November of 2022.

GPT-4, the new multimodal deep learning model from OpenAI, has passed the Uniform Bar Exam, demonstrating an enormous leap for machine learning and proving that an artificial intelligence program can perform complex legal tasks on par with or better than humans, according to a new paper co-authored by Daniel Martin Katz, professor of law at Illinois Institute of Technology’s Chicago-Kent College of Law.

The Uniform Bar Examination (UBE) is coordinated by the National Conference of Bat Examiners, and is composed of the Multistate Essay Examination (MEE), two Multistate Performance Test (MPT) tasks, and the Multistate Bar Examination (MBE). It is uniformly administered, graded, and scored and results in a portable score that can be transferred to other UBE jurisdictions.

In a period of roughly four years, the leading large language model family (GPT) has progressed from zero percent on the Multistate Bar Exam for GPT-2 to nearly 76 percent on the Multistate Bar Exam in GPT-4. (The Multistate Bar Exam is the multiple-choice section of the Uniform Bar Exam.) Overall, the authors report a 297 Uniform Bar Exam score for GPT-4, which reflects passing the bar by a fairly comfortable margin. The highest threshold in the country is Arizona at 273 (Illinois is 266).

“GPT-4 represents a new frontier in AI’s role in the legal profession and society at large,” says Katz, who collaborated with the legal AI company Casetext and fellow researcher Michael Bommarito. “The bar exam is an interesting test for AI to pass because it highlights the prospect of such technology becoming a ‘force multiplier’ that expands access to legal services to all members of society, including those who couldn’t previously afford to hire a lawyer.”

Katz did predict that within a few years, perhaps even by the end of this year, large corporations like Microsoft and Google may start experimenting with offering AI legal services. Nothing that could replace an attorney in a courtroom – yet – but work that is typically performed by law researchers and paralegals, like compiling data or answering clients’ questions about the law.

GPT-4 scored a 75 percent on the bar exam, higher than the 68 percent average and good enough to place in the 90th percentile. In a previous paper that Katz co-wrote, GPT-3.5 scored a 50 percent and passed only two multiple choice portions of the bar exam, placing it in the 10th percentile.

In this test, GPT-4 not only took the multiple choice sections, but also the essays (worth 30 percent) and performance test (worth 20 percent). Although many have been skeptical about AI’s ability to pass sections that require generating language, GPT-4 did so by a significant margin, giving responses that were generally on par with the “representative good answers” provided by many state bars.

The latest GPT model also shows fewer “hallucinations,” in which an AI language model confidently asserts wrong answers that have no basis in reality.

Passing the bar exam requires the command of not just ordinary English, but of complex “legalese,” which is difficult even for humans. GPT’s rapid advancement in this field is sure to have wide implications for the legal profession.

“Lawyers need to figure out how to really use these tools. And those that do, it’ll be a very positive thing for them. We’re sitting on the dawn of a major increase in potential capacity,” says Katz. “These are tools that allow you to more effectively do your work, so you need to learn how to use them to maximum efficacy.”

“I’m generally very optimistic about it,” said Matthew Shepard, a public defender and board member of the Chicago chapter of the National Lawyers Guild, which often provides pro bono counsel to arrestees and activists. “I think it will be helpful in assisting attorneys with filing motions and going through large quantities of discovery”

“Sounds like it could help out a lot of pro se litigants,” agreed Zane Thompson, a workers’ compensation attorney with the Chicago law firm Ganan & Shapiro.

A U.S. lawmaker is taking action after a Kaiser Health News investigation exposed weaknesses in the federal system meant to stop repeat Medicare and Medicaid fraud and abuse.

Rep. Lloyd Doggett (D-Texas) said he decided to introduce a bill in the House late last week after KHN’s reporting revealed what he called a “shocking loophole.”

“The ability of fraudsters to continue billing Medicare for services is outrageous,” Doggett said. “This is an obvious correction that is needed to safeguard our system. Wherever there are large amounts of government money available, someone tries to steal it.”

KHN found a laundry list of weaknesses that allows people accused or convicted of fraud to easily sidestep bans imposed by federal officials. Among those gaps is the Centers for Medicare & Medicaid Services’ lack of authority to deny or revoke National Provider Identifier, or NPI, numbers after federal regulators have prohibited a person or business from receiving payments from government programs.

Doctors, nurses, other practitioners, and health businesses use the unique, 10-digit NPI numbers to bill and file claims with insurers and others, including Medicare and Medicaid.

Taking away the NPI would “be equivalent of prohibiting a practitioner from practicing in total,” Dara Corrigan, director of CMS’ Center for Program Integrity, wrote in an email response to questions about KHN’s investigation. CMS declined to comment on Doggett’s proposed legislation.

The bill, HR 1745, would give CMS the authority to deactivate NPIs tied to anyone convicted of waste, fraud, or abuse and whose name appears on the exclusions list kept by the Office of Inspector General for the U.S. Department of Health and Human Services. The proposed law would also require CMS to implement recommendations that the inspector general has made to improve NPI reporting and provider transparency.

“This strikes me as what should be an easy bipartisan measure,” Doggett said, adding that he had presented the bill in a face-to-face meeting with Rep. Jason Smith (R-Mo.), who chairs the House Ways and Means Committee. Doggett also alerted that panel’s health subcommittee chair, Rep. Vern Buchanan (R-Fla.).

“They both talk about the need to eliminate fraud, and this is one modest but important way to do it,” Doggett said. Neither Smith’s nor Buchanan’s offices responded to requests for comment.

The OIG declined to comment.

Former Justice Department officials told KHN that repeat violators are savvy and find ways to circumvent the system. KHN examined a sample of 300 health care business owners and executives who are among more than 1,600 on the OIG’s exclusion list since January 2017. Journalists reviewed court and property records, social media, and other publicly available documents.

KHN found:

– – Eight people appeared to be serving or served in roles that could violate their bans;
– – Six transferred control of a business to family or household members;
– – Nine had previous, unrelated felony or fraud convictions, and went on to defraud the health care system;
– – And seven were repeat violators, some of whom raked in tens of millions of federal health care dollars before getting caught by officials after a prior exclusion.

Doggett’s bill is “a pretty smart step in the right direction in fixing this issue,” said John Kelly, a former assistant chief of health care fraud at the Department of Justice who is now a partner for the law firm Barnes & Thornburg. Kelly had previously recommended that NPIs should be “essentially wiped clean” when a person is on the exclusions list.

Kelly, who confirmed that Doggett’s office reached out to him after KHN’s investigation was published in December, said taking the NPI number away “certainly doesn’t eliminate all risk” but it’s a move “in the right direction.”

“If you want to bill Medicare, you have to have a valid NPI,” Kelly said.

Cal/OSHA issued 18 citations, including six citations for willful-serious violations, to Parter Medical Products, Inc. for failing to protect its employees from overexposure to ethylene oxide (EtO), a toxic chemical. A willful violation is issued when evidence shows that the employer committed an intentional and knowing violation. The penalties total $838,800 to date, and the status of the ongoing investigation remains “open.”

“Our inspection showed this was not an isolated incident of chemical overexposure to workers,” said Cal/OSHA Chief Jeff Killip. “The employer failed to take action to protect employees even after it knew that some of them were exposed to dangerous levels of ethylene oxide.”

Parter Medical Products, Inc. dba Parter Sterilization Services was founded in 1984, and uses ethylene oxide gas to sterilize medical devices. Chronic exposure to ethylene oxide is associated with cancer, reproductive effects and neurotoxicity. Its odor is undetectable to humans until the concentration exceeds hazardous levels.

On August 5, 2022, Cal/OSHA’s Process Safety Management (PSM) Unit opened an inspection at the Parter facility in Carson. The PSM Unit is responsible for inspecting refineries and chemical plants that handle large quantities of toxic and flammable materials. PSM’s inspection followed an investigation by South Coast Air Quality Management District, which referred the matter to Cal/OSHA.

Parter shut down its facility in August 2022 for several months while it made modifications to reduce outdoor ethylene oxide emissions.

However, Parter’s remediation efforts did not solve the employee-exposure issues indoors. When Cal/OSHA resumed its inspection in December 2022, it found that one employee was overexposed to ethylene oxide his entire shift. Under Cal/OSHA regulations, the permissible exposure limit for eight hours is no more than 1 ppm (parts per million). The employee’s exposure averaged 5 ppm during the shift and averaged 9 ppm during a three-and-a-half-hour period. Tests show Parter employees were exposed to ethylene oxide above the permissible limit from 2019 until 2022.

Cal/OSHA’s citations include violations for the employer’s failure to have an effective safety plan to evaluate and develop controls for hazards, failure to develop a respiratory protection plan as required, failure to monitor employee exposure, and failure to notify workers of exposure over the permissible limit for ethylene oxide.

Parter is located at 17015 Kingsview Avenue in Carson California. The Carson City Council unanimously voted in early 2022 to request air monitors be placed in various locations of the city to monitor air quality.

The City of Carson was advised by South Coast Air Quality Management District (AQMD) that an air pollutant discharge by Parter may constitute a health hazard late in July in the nearby industrial area.

South Coast AQMD has conducted multiple on-site inspections at the facility and conducted field operations in the surrounding area. On July 29, 2022, a Notice of Violation was issued to Parter for Public Nuisance in violation of agency Rule 402 and California Health & Safety Code § 41700. This violation was based on elevated EtO emissions detected through air monitoring efforts outside of the facility at an adjacent business.

South Coast AQMD is further investigating EtO emissions in the nearby residential communities and the agency is working with the City of Carson to identify additional locations to collect 24-hour samples in the nearest community and school. So far, data from residential monitors show EtO levels to be within typical background levels.

Parter had indicated their EtO equipment will remain shut down until additional air pollution controls can be implemented including the modifications and upgrades to air pollution control equipment and temporary enclosures. The facility has initiated the permitting process for the upgrades and South Coast AQMD will review and approve those applications as quickly as possible.

During South Coast AQMD’s monitoring efforts at several commercial EtO sterilization facilities, the agency became aware of fugitive emissions from sources that were not previously known. South Coast AQMD’s investigation has identified that existing pollution controls will need to be upgraded and measures will be needed to reduce fugitive emissions.

South Coast AQMD is working on amending Rule 1405 – Control of Ethylene Oxide and Chlorofluorocarbon Emissions from Sterilization or Fumigation Processes to strengthen requirements to address fugitive emissions, as well as provisions to further reduce EtO emissions from operations at these facilities.

Kandel & Associates, P.A., a Baltimore-based law firm, and Nelson R. Kandel, Esq., have entered into a settlement agreement with the United States to resolve allegations that they failed to reimburse the United States for certain Medicare payments the Government had previously made to medical providers on behalf of firm clients.

“Plaintiffs’ attorneys cannot simply rely on their clients’ representations about their status as Medicare beneficiaries and ignore their obligations to reimburse Medicare for its conditional payments,” said U.S. Attorney Erek L. Barron. “This is the third matter our office has resolved with attorneys who fail to make good on their obligations to repay Medicare for its conditional payments, and we will continue to investigate these matters, regardless of when settlement distributions are made, and regardless of what clients tell their attorneys regarding their status as Medicare beneficiaries.”

The Government’s investigation arose under the Medicare Secondary Payer (“MSP”) provisions of the Social Security Act, which authorizes Medicare, as a secondary payer, to make conditional payments for medical items or services under certain circumstances.

When an injured person receives a tort settlement or judgment, Medicare law requires persons or entities who receive the settlement or judgment proceeds, including the injured person’s attorney, to repay Medicare for its conditional payments. If Medicare does not receive timely repayment, these same laws and regulations permit the Government to recover the conditional payments from the injured person’s attorney and others who received the settlement or judgment proceeds.

The Government alleged that, over many years, Medicare made conditional payments to healthcare providers to satisfy medical bills for firm clients.

During that period, the firm negotiated for and received settlement proceeds for the firm’s clients, but neither the firm nor its clients repaid Medicare for conditional payments it made to medical providers. The Government alleges that the firm disbursed settlement proceeds to clients without confirming the existence of an MSP debt.

Under the terms of the settlement agreement, the firm and Mr. Kandel agreed to pay the United States $39,828.66 to resolve the Government’s claims. This settlement resolves the Government’s claims that the firm and Mr. Kandel failed to resolve at least twelve MSP debts.

The firm and Mr. Kandel also agreed to designate a person at the firm responsible for paying MSP debts; train the designated employee to ensure that the firm pays MSP debts on a timely basis; and periodically review any outstanding MSP debts with the designated employee to ensure compliance.

The claims resolved by this settlement are allegations. The settlement is not an admission of liability by the firm or Mr. Kandel, nor a concession by the United States that its claims are not well founded.

This settlement should remind attorneys of their obligation to reimburse Medicare for conditional payments after receiving settlement or judgment proceeds for their clients. The attorneys’ obligation to reimburse Medicare for conditional payments exists regardless of whether they disburse settlement proceeds to their clients before the Centers for Medicare & Medicaid Services contacts them about the existence of an MSP debt. When attorneys receive settlement funds in personal injury cases, they have an independent obligation to confirm whether their clients received conditional payments from Medicare.