The Workers' Compensation Daily News for Jun 20, 2018
IMR Results Continue at 91% Uphold Rate
Tue, 19 Jun 2018 07:06:16 - Pacific Time
Data on California workers’ compensation independent medical review (IMR) decisions issued in the first quarter of this year shows that the medical dispute resolution process established as part of the 2012 workers’ comp reforms continues to produce consistent outcomes.
There has been little change in the number of IMR determination letters and decisions; the percentage of modified or denied treatment requests that are upheld; the types of treatment requests reviewed; and the small number of physicians who are linked to a majority of the disputed medical service requests.
The latest IMR results come from a California Workers’ Compensation Institute (CWCI) review of IMR decision letters issued in the first three months of this year in response to applications sent to the state Division of Workers’ Compensation after a utilization review (UR) physician modified or denied a medical service requested for an injured worker.
The Institute’s review of the first quarter IMR decisions found that IMR doctors upheld the UR determination 90.6% of the time, while in 9.4% of the cases they deemed the service medically necessary and overturned the UR decision.
That uphold rate nearly matched the 91.2% rate noted for IMRs from the two prior years, and just as in each of the five years since the IMR process began in 2013, pharmaceutical requests represented almost half of the IMR decisions in the first quarter of 2018.
As in the past, requests for opioids were the most common pharmaceutical request submitted for IMR, accounting for 31.0% of all prescription drug IMRs in the first quarter, even though in 91.1% of the IMRs involving opioids, the UR modification or denial was upheld.
Those percentages could change in the future, as most of the first quarter IMRs involved UR decisions from 2017, prior to the January 1 implementation of the workers’ compensation prescription drug formulary and regulations, which set new limits and rules for prescribing opioids to injured workers in California.
The latest results also show that compound drugs represent a dwindling share of the prescription drug IMRs, accounting for just 2.1% of the pharmaceutical IMRs in the first quarter, down from 4.2% in 2017 and 8.1% in 2015, a decline that may be linked to the 98% uphold rate for compound drug denials and modifications submitted to IMR.
As in prior results, the latest IMR data also showed that a small number of physicians continued to account for a disproportionate share of the disputed medical services submitted for IMR. CWCI found that the top 1% of requesting physicians (117 providers) accounted for 44% of the disputed service requests, while the top 10 percent (1,169 providers) accounted for 85% of the disputed service requests. Read More...
DWC Sets MTUS Update Hearing
Tue, 19 Jun 2018 07:06:10 - Pacific Time
The Division of Workers’ Compensation has issued a notice of public hearing for proposed evidence-based updates to the Medical Treatment Utilization Schedule (MTUS), which can be found at California Code of Regulations, title 8, sections 9792.22 and 9792.24.5.
The public hearing is scheduled for Wednesday, July 18 at 10 a.m. in the auditorium of the Elihu Harris Building, 1515 Clay Street, Oakland.
Members of the public may review and comment on the proposed updates no later than July 18.
The proposed evidence-based updates to the MTUS incorporate by reference the latest published guidelines from American College of Occupational and Environmental Medicine (ACOEM) for the following:
--Traumatic Brain Injury (ACOEM November 15, 2017)
--General Approaches section of the MTUS: Prevention (ACOEM May 1, 2011)
--General Approach to Initial Assessment and Documentation (ACOEM July 25,2016)
--Cornerstones of Disability Prevention and Management (ACOEM May 1, 2011)
Although proposed evidence-based updates to the MTUS regulations are exempt from Labor Code sections 5307.3 and 5307.4 and the rulemaking provisions of the Administrative Procedure Act, DWC is required under Labor Code section 5307.27 to have a 30-day public comment period, hold a public hearing, respond to all the comments received during the public comment period and publish the order adopting the updates online. Read More...
Three More Pacific Hospital Indictments
Mon, 18 Jun 2018 07:04:56 - Pacific Time
Three additional doctors have been charged in three new cases for their roles in a 15-year-long health care fraud scheme that involved more than $40 million in illegal kickbacks paid to doctors and other medical professionals in exchange for referring thousands of patients who received spinal surgeries. As a result of the kickback scheme, more than $580 million in fraudulent bills were submitted, mostly to California’s worker compensation system.
David Hobart Payne, 60, an orthopedic surgeon who lives in Irvine, is scheduled to be arraigned in United States District Court on charges of conspiracy, honest services fraud, and using an interstate facility to aid in unlawful activity. A five-count superseding indictment returned by a federal grand jury on April 25 alleges that Payne was bribed approximately $450,000 to steer more than $10 million in kickback-tainted surgeries to Pacific Hospital of Long Beach.
Jeffrey David Gross, 52, an orthopedic surgeon who resides in Dana Point and Las Vegas, Nevada, appeared in federal court and pleaded not guilty to charges contained in a 14-count indictment returned earlier this year by a federal grand jury. Gross, who faces charges of conspiracy, honest services mail fraud and honest services wire fraud, was ordered to stand trial on August 7. The indictment alleges that Gross made at least $622,000 in exchange for performing and/or referring more than $19 million in kickback-tainted surgeries to Pacific Hospital.
In the third indictment being announced today, Lokesh Tantuwaya, 51, who maintains residences in Rancho Santa Fe and Rock Springs, Wyoming, was charged in February by a federal grand jury. The 13-count indictment charges Tantuwaya with conspiracy, honest services fraud, and using an interstate facility to aid in unlawful activity. Tantuwaya, who pleaded not guilty in April, has been ordered to stand trial on November 6. The indictment alleges that Tantuwaya received approximately $3.2 million in kickbacks for referring and/or performing $38 million in surgeries to Pacific Hospital.
The kickback scheme centered on Pacific Hospital of Long Beach, which specialized in surgeries, especially spinal and orthopedic procedures.
The owner of Pacific Hospital, 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. During its final five years, the scheme resulted in the submission of over $500 million in fraudulent medical bills. To date, nine defendants have been convicted for participating in the kickback scheme.
If they were to be convicted of the charges in the indictments announced today, Payne, Gross and Tantuwaya would face potential sentences of decades in federal prison.
Read More...
CalChamber Releases 2018 Job Killer List
Mon, 18 Jun 2018 07:04:50 - Pacific Time
Each year the California Chamber of Commerce releases a list of job killer bills to identify legislation that it says will decimate economic and job growth in California. The CalChamber tracks the bills throughout the rest of the legislative session and works to educate legislators about the serious consequences these bills will have on the state.
The 2018 annual list of job killer bills, calls attention to the negative impact that 28 proposed measures would have on California’s job climate and economic recovery should they become law. Of the 28 on the list, some have been removed as a result of the amendments removing targeted problems. Others have failed to meet legislative deadlines for the year. Of those remaining the following are likely the most crucial to follow.
AB 2351 (Eggman; D-Stockton) Targeted Tax on High Earners - Unfairly increases the personal income tax rate from 13.3% - which is already, by far, the highest income tax rate in the country - to 14.3% for one category of taxpayers (including some proprietors), who already pay half of California’s income taxes, forcing them to mitigate these costs through means that include reducing workforce, in order to provide more funding for higher education.
AB 3080 (Gonzalez Fletcher; D-San Diego) Ban on Settlement Agreements and Arbitration Agreements - Significantly expands employment litigation and increases costs for employers and employees by banning settlement agreements for labor and employment claims as well as arbitration agreements made as a condition of employment, which is likely preempted under the Federal Arbitration Act and will only delay the resolution of claims. Banning such agreements benefits the trial attorneys, not the employer or employee.
ACA 22 (McCarty; D-Sacramento) Middle Class Fiscal Relief Act - Unnecessarily increases California’s 8.84% corporate tax rate, already one of the highest in the nation, to 18.84%, which will encourage companies to leave the state and discourage companies from expanding or relocating here.
SB 993 (Hertzberg; D- Van Nuys) Tax on Services - Imposes a 3% tax on services purchased by businesses in California, with some exceptions, adding another layer of taxes onto California companies, raising costs, and putting them at a competitive disadvantage.
SB 1398 (Skinner; D-Berkeley) Increased Tax Rate - Threatens to significantly increase the corporate tax rate on publicly held corporations and financial institutions up to 15% according to the wages paid to employees in the United States, and threatens to increase that rate by 50% thereafter, if the corporation or institution reduces its workforce in the United States and simultaneously increases its contractors.
The 2018 list also tracks 2017 Carry-Over Bills that were started in 2017, and continue to be considered in the 2018 legislative session. More details and updates on all of the 2018 legislation can be tracked on the 2018 Job Killer Bills webpages.
Read More...
Properly Worded C&R Also Releases FEHA Claims
Fri, 15 Jun 2018 13:58:56 - Pacific Time
Artemio Elguea was a pizza delivery driver for Pizza Hut.. His general manager was Alex Rodriguez.
Elguea alleged that Rodriguez discriminated against him on the basis of his age - reducing his hours, stealing his tips, and allowing other employees (who were related to Rodriguez) to throw food at him. Elguea’s doctor placed him on medical leave for stress, and he never returned to Pizza Hut.
Elguea brought suit against PIzza Hut alleging age discrimination, related causes of action under the Fair Employment and Housing Act (FEHA) and other torts.
While this action was pending, Elguea was also pursuing multiple workers’ compensation claims. The four workers’ compensation cases were resolved by two simultaneous settlements, each for slightly less than $25,000 (to avoid MSA approval requirements). Each Compromise & Release was signed by Elguea, and one of his workers’ compensation attorneys, Diana Sparagna.
Each C&R had an addendum which specifically stated the following: "This Compromise & Release also includes resolution of all claims arising under any state or federal law regulation, including the California Fair Employment and Housing Act, federal and state wage and hour laws, federal and state False Claims Acts, Title VII of the Civil Rights Act, the Americans With Disabilities Act, the Family Medical Leave Act, the California Family Rights Act, the California Labor Code,.......(etc)"
Pizza Hut then moved for judgment on the pleadings in the civil case, based on the releases and, specifically, the broad language in the addenda to the C&R. The court granted judgment on the pleadings without leave to amend. The Court of Appeal affirmed in the unpublished case of Elguea v. Southern Cal. Pizza Co., LLC. Elquea also attempted to set aside the C&R at the WCAB, but his Petition in this regard was denied.
Elguea argued, among other things, that he does not understand English and was never informed in the workers’ compensation action that he was releasing his civil claims. Elguea asserted that he was represented by counsel in the FEHA action at the time of the workers’ compensation settlement, and nobody informed his FEHA counsel that the FEHA complaint was being addressed by the workers’ compensation settlement.
The Court of Appeal ruled that If the parties to the workers’ compensation proceeding include in their release an addendum which reflects an intention to reach beyond workers’ compensation, that addendum may be given effect and may encompass FEHA claims. (Jefferson v. Department of Youth Authority (2002) 28 Cal.4th 299, 301) "Given this controlling authority, we easily resolve the issues raised by Elguea on appeal."
"Indeed, this case is stronger than Jefferson, in that the addendum to the workers’ compensation releases Elguea signed here expressly encompasses FEHA claims. In short, the trial court correctly concluded that a release which specifically includes FEHA claims does, in fact, release FEHA claims." Read More...
States Now Sue Walgreens for Opiod Crisis
Fri, 15 Jun 2018 13:58:50 - Pacific Time
The Kentucky Attorney General filed suit against Walgreens on for its dual role as distributor and pharmacy in allegedly failing to legally monitor its own operations that shipped and dispensed large quantities of opioids through its more than 70 locations statewide.
The lawsuit, filed in Boone Circuit Court, alleges unfair, misleading and deceptive business practices by Walgreens for excessively distributing and dispensing opioids in Kentucky and for failing to legally report to state and federal authorities the suspiciously large orders it received for prescription opioids.
The Attorney General said he filed his sixth lawsuit in Boone County because of the large number of Kentuckians who have died from overdoses in Northern Kentucky.
The lawsuit alleges that Walgreens, whose 2018 second quarter sales topped $33 billion, failed to use its unique position as a pharmacy and distributor to prevent the flood of opioids into Kentucky.
As a distributor, the company has real-time data regarding exact amounts of pills, pill types and customer orders for its store and is legally required to report suspicious orders to the DEA. The company has distribution centers close to Kentucky’s borders in Illinois and Ohio.
As a pharmacy, it is legally required to monitor and flag suspicious customer prescriptions, such as individuals traveling long distances to fill prescriptions or doctors prescribing outside the scope of their usual practice.
The Kentucky Attorney General said Walgreens knew or should have known of Kentucky’s exceedingly high rate of suspicious opioid shipments and prescriptions and the significant correlating risk of abuse, misuse and diversion of prescription opioids.
This new lawsuit is the sixth opioid related lawsuit the Kentucky Attorney General has filed.
Read More...
MSP Class Action Firm Sanctioned in State Farm Case
Thu, 14 Jun 2018 07:41:55 - Pacific Time
Miami lawyers expected a state court victory in 2017 to pave the way for billions of dollars from liability and workers' compensation insurance carriers across the nation to flow back to Medicare and its beneficiaries.
The attorneys, John Ruiz and Frank Quesada of the firm MSP Recovery, are going after major liability insurers for allegedly shirking their duty to reimburse Medicare benefit providers for conditional payments. Under the Medicare Secondary Payer law known by the acronym MCP, the government can recover double damages from a primary payer that fails to pay Medicare back for medical expenses covered by a liability policy
The home page of the firm boasts of the slogan aimed to attracted its clients who are Medicare Advantage insurance companies, challenging them to "DISCOVER YOUR LOSSES - RECOVER WHAT'S YOURS."
No attorney had ever secured class certification under the Medicare Secondary Payer law. A nuanced interplay between federal and state laws made it difficult to establish common issues of law and fact. But MSP Recovery overcame those obstacles in Miami-Dade Circuit Court in 2017, where Judge Samantha Ruiz Cohen certified a class in a lawsuit against the auto insurer Ocean Harbor Casualty Insurance, a primary payer for thousands of Medicare Part C beneficiaries.
The judge also noted MSP Recovery has developed a sophisticated system to identify claims by collecting and matching data including Centers for Medicare & Medicaid Services reports, automobile crash reports, ambulance records, insurance declaration sheets and no-fault personal injury protection payout sheets.
That system has allowed the 30-attorney firm with roughly three dozen partner firms across the country to divide claims into categories and file lawsuits across the country on behalf of more than 100 health plans. Their firms boasts of more than 100 class actions pending in state and federal courts across the nation. Targeted defendants include companies such as Allstate Property & Casualty, Liberty Mutual, State Farm Mutual Automobile, Geico and others.
But the firm has suffered some setbacks. Just recently, MSP Recovery LLC and several of its attorneys have been sanctioned by a Federal District Court.The decision is entitled Recovery v. State Farm Mut. Auto. Ins. Co. 2018 U.S. Dist. LEXIS 95789, U.S. District Court for the Central Dist. Of Ill. (June 7, 2018).
This class action involved the usual allegations by MSP Recovery LLC, essentially that MSP Recovery has assignments from various MAPs that have made Medicare conditional payments wherein State Farm should have been the primary payer and/or reimbursed the MAPs that made those conditional payments.
MSP Recovery failed to allege any facts supporting their claims. More particularly, MSP Recovery LLC failed to identify any MAPs that allegedly paid medical expenses on behalf of Medicare beneficiaries. MSP Recovery then filed its first Amended Complaint, and then attempted a Second Amended Complaint to correct the deficiency. The court found MSP Recovery’s contradictory statements to be "palpably absurd and clearly wrong under the law."
The court issued Rule 11 sanctions in the amount of $5,000 against three of MSP Recovery LLC’s attorneys, as well as an additional $5,000 against MSP Recovery LLC itself, for a total of $20,000.
The Court explained that "Plaintiffs characterize their inaccurate allegations as "correctable flaw[s]." (Doc. 88 at 4). They argue that "it is in the nature of the course of litigation to discover additional facts that change the accuracy of the pleadings". Id. The Court would be more amenable to this argument if Plaintiffs discovered these inaccuracies early on in litigation, or at least owned up to the misstatements once the Court questioned the Second Amended Complaint's accuracy in April. The parties have been litigating the issue of standing for over a year, and this is Plaintiffs' third attempt at filing an adequate complaint." Read More...
Lodi Orthopedic Surgeon to Face Fraud Changes
Thu, 14 Jun 2018 07:41:48 - Pacific Time
Dr. Gary Royce Wisner, 61, of Lodi, was arraigned at the San Joaquin County Superior Court on 11 felony counts of insurance fraud for bilking insurers out of more than $700,000 for allegedly providing unnecessary and excessive medical treatment for orthopedic patients.
Wisner did not enter a plea and the case has been continued until June 26 th , for further arraignment.
Wisner, is a board certified orthopedic surgeon in Lodi, California. He is currently licensed to practice medicine in California, Alabama, and Nevada. He claims to be affiliated with Adventist Health Lodi Memorial, St. Joseph's Medical Center, and Dameron Hospital. He is a graduate of Universidad Autonoma de Guadalajara Medical School.
"Dr. Wisner violated his Hippocratic Oath when he allegedly abused his patients and the workers' compensation system to line his pockets with illegal profits," said Insurance Commissioner Dave Jones. "When medical providers scam the system, everybody loses, including the injured workers, their employers and consumers when the losses are passed along to them through higher prices for goods and services."
The California Department of Insurance, the San Joaquin County District Attorney's Office, the California Department of Justice Bureau of Medi-Cal Fraud and Elder Abuse, and the U.S. Department of Health & Human Services launched a multi-agency investigation, which revealed Dr. Wisner was providing unnecessary treatments, including exposing his patients to excessive X-rays - all for the purpose of committing insurance fraud. Dr. Wisner's fraud resulted in a loss of over $700,000 to four insurers including State Compensation Insurance Fund, Zenith Insurance, Hartford and Tristar, the federal insurance system.
Health insurance fraud is a multi-billion dollar drain on California's economy and results in higher insurance premiums for business and consumers. Over the last two years, the Department of Insurance has made arrests in health care fraud cases totaling more than $2 billion dollars.
On May 30, 2018, a San Joaquin County criminal grand jury indicted Dr. Wisner on 11 felony counts of insurance fraud. The San Joaquin County District Attorney's Office is prosecuting this case. The grand jury indictment will not be publicly available until 10 days after its receipt by the defendant.
The California Medical Board reports his license to be current and active with no record of disciplinary actions.
Read More...
Exclusive Remedy Exception Requires Extreme & Outrageous Conduct
Wed, 13 Jun 2018 11:28:16 - Pacific Time
Jessica Aram worked as a genetic counselor for Laboratory Corporation of America Holdings. She provided prenatal genetic counseling to patients at several clinics in Southern California, including followup care and counseling when a genetic test revealed abnormal results.
A dispute arose between Aram and LabCorp about the content of her clinical notes. The dispute was not resolved between them regarding the details provided in her documentation. . Her employment was terminated by LabCorp in October, 2011.
In 2014, Aram filed a civil complaint against her employer asserting causes of action for wrongful termination, retaliatory discharge,violation of whistleblower protections, and intentional infliction of emotional distress. Aram alleged that respondents’ bullying and threats constituted the basis of her claim for intentional infliction of emotional distress.The employer moved for summary judgment or, in the alternative, summary adjudication.
After hearing argument and orally explaining its analysis of the evidence, the court granted the motion and dismissed her case.
In addition to ruling against her substantiative claims, the court also found that the employer's actions did not "constitute extreme or outrageous conduct" to support the claim for intentional infliction for emotional distress, and the claim was "barred by the exclusivity provisions of the California Workers’ Compensation Act."
The Court of Appeal affirmed the judgment in the unpublished case of Aram v. Esoterix Genetic Labs LLC .
On appeal, among other employment law related issues, Aram claims the trial court erred in concluding that her claim for intentional infliction of emotional distress was barred by the exclusivity provisions of the California Workers’ Compensation Act. The Court of Appeal disagreed.
The Court noted that when a claim of intentional infliction of emotional distress is based on allegedly wrongful conduct that "occurred at the worksite, in the normal course of the employer-employee relationship" then "workers’ compensation is [a plaintiff’s] exclusive remedy for any injury that may have resulted."
This is so even when the alleged emotional distress arose from conduct that would support whistleblower claims such as those alleged by Aram.
She would be required to show "extreme or outrageous conduct" to circumvent the exclusive remedy limitation.
Read More...
EU Joins International Effort Restraining Antibiotic Use
Wed, 13 Jun 2018 11:28:09 - Pacific Time
Antimicrobial resistance (AMR) is the ability of a microorganism (like bacteria, viruses, and some parasites) to stop an antimicrobial (such as antibiotics, antivirals and antimalarials) from working against it. As a result, standard treatments become ineffective, infections persist and may spread to others.
Repeated and improper uses of antibiotics are primary causes of the increase in drug-resistant bacteria. While antibiotics should be used to treat bacterial infections, they are not effective against viral infections like the common cold, most sore throats, and the flu.
In 2014, the US adopted its National Strategy for Combating Antibiotic Resistant Bacteria which identified priorities and coordinates investments: to prevent, detect, and control outbreaks of resistant pathogens recognized by CDC as urgent or serious threats
At the Sixty-eight World Health Assembly in May 2015, the World Health Assembly endorsed a global action plan to tackle antimicrobial resistance, including antibiotic resistance, the most urgent drug resistance trend.
An now Reuters reports that EU member states backed a plan this month to combat antimicrobial resistance, an increasing global health issue, that would reduce the use of antibiotics in the food chain and limit certain drugs to humans.
EU data suggests that some 700,000 people a year are estimated to die globally because of antimicrobial resistance.
"New smart EU rules will give us robust tools to prevent the abuse of antibiotics and limit the risk of the development of antimicrobial resistance," said Bulgarian Agriculture Minister Rumen Porodzanov. Bulgaria holds the EU’s rotating presidency.
The rules, agreed by EU ambassadors, limit the prophylactic use of antibiotics for animals that are not yet sick and provide clearer guidelines to countries outside the EU. Non-EU farmers will be prohibited from using antibiotics to cultivate larger animals, which is still a common practice but banned in the European Union, if they want to sell in the bloc.
The rules will also limit certain medicines to their treatment of humans in order not to water down their efficacy in combating infections.
The European Parliament and the European Council, which groups the EU’s 28 member states, still need to approve the new rules.
An estimated 10 million people a year could die because of resistance to antibiotics, former Goldman Sachs chief economist Jim O’Neill said in 2014. Read More...
Past Week News Archive
Corporate America Frustrated with Rising Health Costs: Tue, 12 Jun 2018 09:10:01 - Pacific Time: Read More...
Man Sentenced for Farm Labor $500K EDD Fraud: Tue, 12 Jun 2018 09:09:54 - Pacific Time: Read More...
C&R Addendum Did Not Release Civil Liability: Mon, 11 Jun 2018 09:10:49 - Pacific Time: Read More...
San Diego Psychologist Charged With $2.2M Fraud: Mon, 11 Jun 2018 09:10:44 - Pacific Time: Read More...
Couple Checking on Neighbor Was "Active Law Enforcement": Fri, 8 Jun 2018 12:58:05 - Pacific Time: Read More...
Bay Area Doctor and Interpreter Face Fraud Charges: Fri, 8 Jun 2018 12:57:58 - Pacific Time: Read More...
SCIF Reduces Opioid Prescriptions by 60%: Thu, 7 Jun 2018 10:48:18 - Pacific Time: Read More...
Oxnard Janitorial Owner to Serve 1 Year for Fraud: Thu, 7 Jun 2018 10:48:11 - Pacific Time: Read More...
Riverside QME Faces Fraud Charges: Wed, 6 Jun 2018 08:29:38 - Pacific Time: Read More...
Bakersfield Chiro Pleads Guilty to Comp Fraud: Wed, 6 Jun 2018 08:29:32 - Pacific Time: Read More...