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Lindsay Wagenman is currently the Managing Attorney for our Bay Area operations located in Oakland, California. Prior to joining Floyd, Skeren and Kelly in 2011, she worked at several employment law firms handling wage and hour class actions, wrongful termination, general civil litigation and workers' compensation. Ms. Wagenman received her Bachelor of Arts, magna cum laude, from San Diego State University, where she majored in Journalism with a minor in Public Administration. Ms. Wagenman graduated from the San Francisco Law School in May 2008 and was admitted to the California Bar in December 2008. During one of her summers in law school, she served as a judicial law clerk to Honorable Luis A. Gonzalez of the New York Supreme Court, Appellate Division, First Department.

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Workers' Compensation Daily News for Jul 22, 2014

Federal Court Says Obamacare Subsidies Illegal
Tue, 22 Jul 2014 09:11:39 - Pacific Time
In a potentially crippling blow to Obamacare, a federal appeals court panel declared this morning that government subsidies worth billions of dollars that helped 4.7 million people buy insurance on HealthCare.gov are illegal. The 2-1 ruling in Halbig v US Secretary of HHS said such subsidies can be granted only to people who bought insurance in an Obamacare exchange run by an individual state or the District of Columbia - not on the federally run exchange HealthCare.gov. The ruling relied on a close reading of the Affordable Care Act.

"Section 36B plainly makes subsidies available in the Exchanges established by states," wrote Senior Circuit Judge Raymond Randolph in his majority opinion, where he was joined by Judge Thomas Griffith. "We reach this conclusion, frankly, with reluctance. At least until states that wish to can set up their own Exchanges, our ruling will likely have significant consequences both for millions of individuals receiving tax credits through federal Exchanges and for health insurance markets more broadly."

In his dissent, Judge Harry Edwards, who called the case a "not-so-veiled attempt to gut" Obamacare, wrote that the judgment of the majority "portends disastrous consequences."

Indeed, the 72-page decision threatens to unleash a cascade of effects that could seriously compromise Obamacare's goals of compelling people to get health insurance, and helping them afford it. However, the ruling does, and will not ultimately affect the taxpayer-fund subsidies the federal government issued to 2 million or so people through the 15 exchanges run by individual states, including California, and the District of Columbia, The Obama administration is certain to ask the full U.S. Court of Appeals for the District of Columbia Circuit to reverse the panel's decision, which for now does not have the rule of law.

According to the story on CNBC, White House spokesman Josh Earnest said the ruling "for now - does not have any practical impact" on premium subsidies issued to HealthCare.gov enrollees now. " "We are confident" that the ruling will be overturned, Earnest said. "We are confident in the legal position we have . . . the Department of Justice will litigate these claims through the federal court system." Earnest said "it was obvious" that Congress intended subsidies, or tax credits, to be issued to Obamacare enrollees regardless of what kind of exchange they used to buy insurance.

Tuesday's ruling endorsed a controversial interpretation of the Affordable Care Act that argues that the HealthCare.gov subsidies are illegal because ACA does not explicitly empower a federal exchange to offer subsidized coverage, as it does in the case of state-created exchanges. HealthCare.gov serves residents of the 36 states that did not create their own health insurance marketplace. About 4.7 million people, or 86 percent of all HealthCare.gov enrollees, qualified for a subsidy to offset the cost of their coverage this year because they had low or moderate incomes. If upheld, the ruling could lead many, if not most of those subsidized customers to abandon their health plans sold on HealthCare.gov because they no longer would find them affordable without the often-lucrative tax credits. And if that coverage then is not affordable for them as defined by the Obamacare law, those people will no longer be bound by the law's mandate to have health insurance by this year or pay a fine next year.

The ruling also threatens, in the same 36 states, to gut the Obamacare rule starting next year that all employers with 50 or more full-time workers offer affordable insurance to them or face fines. That's because the rule only kicks in if one of such an employers' workers buy subsidized covered on HealthCare.gov. The decision by the three-judge panel is the most serious challenge to the underpinnings of the Affordable Care Act since a challenge to that law's constitutionality was heard by the Supreme Court. The high court in 2012 upheld most of the ACA, including the mandate that most people must get insurance or pay a fine. Read More...

California Supreme Court Allows Wage Damages in Illegal Alien FEHA Claims
Tue, 22 Jul 2014 09:11:31 - Pacific Time
Sierra Chemical Co. manufactures, packages, and distributes chemicals for treating water, including water in swimming pools. As the weather gets warmer in spring and summer, consumer demand for its products increases, while in fall and winter demand decreases, which in turn results in seasonal layoffs of many production line employees. Those laid-off workers generally are recalled to work when consumer demand rises.

In April 2003, Vicente Salas applied for a job with Sierra, providing a Social Security number and a resident alien card. He completed and signed, under penalty of perjury, federal Immigration and Naturalization form I-9, in which he listed the same Social Security number he had given to Sierra, and he attached to the form a copy of a Social Security card with that number. He also signed an employee's Internal Revenue Service withholding form W-4, which had the same Social Security number he had given. In May 2003, Salas began working on Sierra's production line.

In March 2006, Salas injured his back while stacking crates on Sierra's production line. On August 16, 2006, he again injured his back while stacking crates and was taken to the hospital. Thereafter, he filed a workers' compensation claim for his workplace back injury. He still came to work, performing modified duties, until December 15, 2006, when he was laid off during seasonal reduction of workers. In either late January or early February of 2007, Salas started working for another company. On May 1, Sierra sent Salas a letter stating that it was recalling laid-off employees and informing him to call or come to the office to make arrangements to return to work. The letter also told him to bring "a copy of your doctor's release stating that you have been released to return to full duty." Salas did not reported for work as he had not yet been released by his physician. But the employer indicated he would hold the job open until he was able to get a release.

In August 2007, Salas sued Sierra. The first cause of action alleged Sierra failed to provide reasonable accommodations for his disability, in violation of California's FEHA. The second cause of action alleged a violation of the public policy expressed in the FEHA, by retaliating against him for filing a workers' compensation claim and for being disabled.

Salas advised the court that he would testify at trial and assert his privilege against self-incrimination under the Fifth Amendment to the United States Constitution if asked about his immigration status. This information led the employer to investigate the authenticity of the employment documents that were given to Sierra which were discovered to be fraudulent. The employer moved for summary judgment based upon this information which was granted after appeal to the Court of Appeal. The Court of Appeal reasoned that the doctrine of after-acquired evidence barred Salas' causes of action because he had misrepresented his eligibility under federal law to work in the United States. It also held that his claims were subject to the doctrine of unclean hands because he had falsely used another person's Social Security number in seeking employment with defendant, he was disqualified under federal law from working in the United States, and his conduct exposed the employer to penalties under federal law.

The California Supreme Court reversed in the case of Salas v Sierra Chemical Company. It concluded that (1) Senate Bill No. 1818, which extends state law employee protections and remedies to all workers "regardless of immigration status," is not preempted by federal immigration law except to the extent it authorizes an award of lost pay damages for any period after the employer's discovery of an employee's ineligibility to work in the United States; and (2) contrary to the Court of Appeal's holdings, the doctrines of after-acquired evidence and unclean hands are not complete defenses to a worker's claims under California's FEHA, although they do affect the availability of remedies.

The California Legislature enacted Senate Bill No. 1818 in 2002 in response to the United States Supreme Court's decision earlier the same year in Hoffman Plastic Compounds, Inc. v. NLRB (2002) 535 U.S. 137 (Hoffman). It said that the NLRB could not "award backpay to an illegal alien for years of work not performed, for wages that could not lawfully have been earned, and for a job obtained in the first instance by a criminal fraud." (Id. at p. 149.) "[A]warding backpay to illegal aliens," the high court held, "runs counter to policies underlying" the Immigration Reform and Control Act of 1986.

However, Hoffman, did not decide any issue regarding federal preemption of state law but instead addressed federal immigration law's impact on a federal agency’s authority. A distinction is made between pre-discovery and post-discovery. remedies. Federal law preempts state Senate Bill No. 1818 to the extent that it makes a California FEHA lost pay award available to an unauthorized alien worker for the post-discovery period. In allowing lost wages for the pre-discovery period, state labor laws does not directly conflict with the federal Immigration Reform and Control Act of 1986, because compliance with both federal and state laws is not impossible. Federal law does not prohibit an employer from paying, or an employee from receiving, wages earned during employment wrongfully obtained by false documents, so long as the employer remains unaware of the employee's unauthorized status. Read More...

Berkshire Hathaway Assumes Billions of Dollars of Liberty Mutual Risk
Mon, 21 Jul 2014 08:37:11 - Pacific Time
On July 17, 2014, Liberty Mutual Insurance reached a definitive agreement with National Indemnity Company, a subsidiary of Berkshire Hathaway Inc., on a combined aggregate adverse development cover for substantially all of Liberty Mutual Insurance’s U.S. workers compensation, asbestos and environmental liabilities, attaching at approximately $12.5 billion of combined aggregate reserves with an aggregate limit of $6.5 billion.

At the closing of this transaction, but effective as of January 1, 2014, Liberty Mutual Insurance ceded approximately $3.3 billion of existing liabilities under a retroactive reinsurance agreement. NICO will provide approximately $3.2 billion of additional aggregate adverse development cover. Liberty Mutual Insurance paid NICO total consideration of approximately $3.0 billion.

The agreement covers Liberty Mutual Insurance’s potentially volatile U.S. asbestos and environmental liabilities arising under policies of insurance and reinsurance with effective dates before January 1, 2005, as well as Commercial Insurance’s workers compensation liabilities as respects injuries or accidents occurring before January 1, 2014. NICO will assume responsibility for claims handling related to Liberty Mutual Insurance’s asbestos and environmental claims. Liberty Mutual Insurance will continue to handle all workers compensation claims.

"We believe that this agreement further strengthens our financial position as it eliminates a substantial source of uncertainty in these liabilities and allows us to focus on execution in our core businesses," said David H. Long, Liberty Mutual Insurance Chairman and Chief Executive Officer. Workers’ compensation has challenged U.S. insurers amid climbing medical costs and low interest rates that make it hard for carriers to generate investment income from the premiums they hold. The industry has posted underwriting losses in the segment every year since 2007, according to data from the National Council on Compensation Insurance Inc

This transaction will be accounted for as retroactive reinsurance in Liberty Mutual Insurance’s GAAP consolidated financial statements and results in a pre-tax loss of approximately $130 million as of the effective date, which will be included in third quarter results. Standard and Poor’s raised Liberty Mutual’s credit rating one grade to BBB, two levels above junk, after the announcement. The deal "largely mitigates" the insurer’s risk of having to add to reserves and reduces earnings volatility, the ratings company said in a statement.

As chairman and CEO, Buffett, 83, fueled Berkshire’s growth over the last five decades by investing insurance premiums in stocks and takeovers. The company’s dozens of operating businesses now span the transportation, energy, manufacturing and retail industries.
Read More...

More than 50% of Patients Make Costly Medication Mistakes After Surgery
Mon, 21 Jul 2014 08:37:04 - Pacific Time
More than half of heart patients in a new study made mistakes taking their medications or misunderstood instructions given to them after being discharged from the hospital. Those with the lowest "health literacy" were among the most likely to make the risky errors, highlighting the importance of healthcare professionals making sure their instructions are clear and of patients being sure they understand what they need to do after they get home, the study authors say. "Some errors have the potential to be harmful to patients," said lead author Dr. Amanda Mixon, a hospitalist with the VA Tennessee Valley Healthcare System in Nashville. "Thousands of patients are discharged home with medications every day. Knowing which patients are at risk of medication errors after patients go home can help inpatient providers counsel patients about their medications before they go home," added Mixon, who is also affiliated with Vanderbilt University.

According to the story in Reuters Health, past research suggests that an individual’s health literacy, the ability to interpret and act on health information, is a strong predictor of whether they will correctly follow instructions for their own care. Overall, 20 to 30 percent of prescriptions are never filled, and 50 percent are not continued as prescribed, according to the U.S. Centers for Disease Control and Prevention.

To assess what factors might influence whether heart patients will follow their care instructions correctly after leaving the hospital, Mixon’s team recruited 471 people hospitalized for heart failure, heart attacks and related conditions, then discharged from the hospital. The participants’ average age was 59 and just under half were women. Every participant took a seven-minute health literacy test to gauge their understanding of health information as well as a short numeracy test to measure basic math skills.

The researchers contacted the patients by telephone two to three days after they left the hospital and compared the medications on the discharge list from their doctors to what the patients said they were taking. When someone said they were taking a medication not on the list, or forgot to mention one that was on the list, it was counted as an error. If a patient didn’t know the purpose, dose or frequency of a medication, it was classified as a misunderstanding. Failure to refill a prescription, discontinuing use of a medication against a healthcare professional’s orders or not being aware of a medication were also counted as errors.

More than half - 242 of the 471 patients - had at least one discrepancy between the medications they reported taking, and the ones on their discharge list. Over a quarter left out one or more medications on their list and more than a third were taking something that was not on the list. And 59 percent of patients had a misunderstanding of the purpose, dose or frequency of their medications.

Participants who scored highest on the math skills test were about 23 percent less likely than those who scored lowest to add or omit medications, the researchers report in Mayo Clinic Proceedings. People with the highest health literacy scores were about 16 percent less likely to make an error compared to those who scored lowest. And women were about 40 percent less likely than men to make a mistake. Single people were almost 70 percent more likely than people who were married to make errors. Older age and worse cognitive function also predicted higher odds of having an error.

"It’s a powerful study in that it helps to define some of the things we assume, but haven't been able to fully understand," said Dr. Benjamin Brooke, a surgeon and professor at the University of Utah School of Medicine in Salt Lake City, who was not involved in the study. "I think this says that we need to do a better job of understanding a patient at the time of discharge, what are their risks of having a post discharge adverse event," he told Reuters Health.

This study should help workers' compensation case managers focus on a strategy that should help better post surgical outcomes. Read More...

Uninsured Motorist Carrier May Offset Workers' Compensation Benefits
Fri, 18 Jul 2014 13:56:56 - Pacific Time
Nicholas Ortiz was injured while in the course and scope of his employment when a vehicle driven by Choi Seok Hwan collided with his vehicle. Hwan’s insurance policy had an available per person policy limit of $15,000 and Ortiz settled his liability claim for that amount. Ortiz also received approximately $107,000 in workers’ compensation benefits.

Ortiz then made a claim for underinsured motorist benefits under a State Farm automobile policy. This policy has underinsured motorist limits of $100,000. State Farm denied his claim based on the offset language in the policy’s underinsured motorist coverage section which provided that "Any amount payable under this coverage shall be reduced by any amount paid or payable to or for the insured : a.for bodily injury under the liability coverage; or b.under any workers’ compensation, disability benefits, or similar law."

Ortiz filed a complaint in Superior Court for declaratory relief claiming that, when compared to the statutory requirements, this offset provision is overly broad and therefore is void. The trial court disagreed with Ortiz and concluded that the policy was to be read and enforced as if it did comply with the law and that the $107,000 Ortiz received in workers’ compensation benefits reduced the available underinsured motorist benefits to "$0." Accordingly, the trial court granted State Farm’s motion for summary judgment.

The Court of Appeal agreed with the dismissal and reasoning of the trial court in the unpublished case of Nicholas Ortiz v State Farm Mutual Automobile Insurance Company.

Insurance Code section 11580.2, subdivision (h), provides that any loss payable under the terms of the uninsured motorist endorsement or coverage to or for any person may be reduced by the amount paid under any workers’ compensation law, exclusive of nonoccupational disability benefits. Although this setoff provision specifically applies to uninsured motorist coverage, it permits such a setoff against underinsured motorist coverage as well. (Rudd v. California Casualty Gen. Ins. Co. (1990) 219 Cal.App.3d 948, 953-954.)

State Farm was statutorily authorized to offset these workers’ compensation benefits against the underinsured motorist coverage. By authorizing such a reduction, the Legislature intended to prevent the insured from recovering twice for the same injury. The Legislature’s purpose in enacting section 11580.2 was to shift the cost of an industrial injury sustained by an employee, as the result of the negligence of an uninsured motorist, from the motoring public (who pay the premium for uninsured motorist coverage) to the employer or workers’s compensation carrier. Thus, as applied to appellant, the offset provision in the State Farm policy promotes public policy. Read More...

DWC Publishes Assessment of SB 863 Reforms
Fri, 18 Jul 2014 13:48:51 - Pacific Time
The Department of Industrial Relations and its Division of Workers’ Compensation posted a progress report on the department’s implementation of Senate Bill 863, the 2012 law which makes wide-ranging changes to California’s workers’ compensation system.

The report, "SB 863: Assessment of Workers’ Compensation Reforms," describes improvements made as well as the challenges remaining to fulfill the law’s intent to improve benefits to injured employees while containing costs. SB 863 became law on Jan.1, 2013, but not all provisions were effective immediately, and some aspects are still going through the rulemaking process.

:DIR took a balanced approach to putting SB 863’s reforms into practice," said DIR Director Christine Baker. "The priority was to increase the benefits in 2013, reduce frictional costs and implement the cost savings efficiencies through regulations, a process that started as soon as the law was signed. We have laid the groundwork for the next stage of improvements and expect more gains in the years ahead." Key findings of the report include:

1)  Although SB 863 successfully trimmed three percentage points off the rate increase, employers still had to endure an increase of more than 10% in their workers’ compensation costs. Insurance prices had already begun to rise in 2012. After SB 863 was passed, the Department of Insurance adopted a minimum pure premium rate for Jan. 1, 2013, which was up 11.3% from the rate one year earlier. If SB 863 had not been enacted, indications are that the rates would have increased by 14.3%.
2)  Permanent disability benefits increases are now in effect. It is too soon to determine the net effects, primarily because it takes up to two years or more for permanent disability to be determined.
3)  SB 863 strengthened California’s self-insurance marketplace, thanks to the greater oversight authority provided to DIR’s Office of Self Insurance Plans over self-insured employers. The reforms lowered the rate of defaults thereby reducing costs to all remaining self-insurers. To date, no defaults have occurred in self-insured entities since SB 863 regulatory changes went into effect.
4)  SB 863 reduced ambulatory surgery center (ASC) facility fees from 120% to 80% of Medicare’s hospital outpatient fee schedule. The average amount paid per ASC episode in the first six months after the change in fee schedules was 26% lower than in the year before the change took effect.
5)  SB 863 amended the inpatient fee schedule by repealing the separate reimbursement for spinal hardware. The average amount paid per episode of the spinal surgery involving implantable hardware declined by 56% after the separate reimbursement (duplicate payment) for spinal hardware was repealed.
6)  The lien filing fee halved the number of new liens being filed. In the first year the filing fee was in effect, 213,092 liens were filed, down from 469,190 in 2011, a greater than 50% reduction. This represents a cost savings of an estimated $270 million per year in litigation costs to California employers and insurers.
7)  Medical costs appear to be down: Preliminary data from WCIRB indicate that the estimated ultimate medical loss per lost-time claim is down 1.3% from calendar year 2012 to 2013. However, because the estimate is based on historical trends and adjusters’ predictions of what their cases will cost over the lifetime of the case, it is a weak performance indicator of the workers’ compensation system after the extensive reforms brought about by SB 863.
8)  The Independent Medical Review (IMR) process is heavily used: approximately 185,000 IMR applications have been filed to date. The qualified medical evaluator (QME) process that IMR replaces costs on average $1,653 per QME request, at least three times higher than the administrative cost of an IMR. An IMR costs $420 to process, down from $560 initially, and the cost will go down further starting in 2015.
9)  Ten sets of cost-saving regulations have been enacted, and additional regulations are in process.
10)  More than 80 percent of IMR determinations uphold the utilization review (UR) finding that the treatment requested is not medically necessary. Pharmaceuticals are the most common IMR request, and narcotics are the most common type of pharmaceutical requested.

"One of the key improvements of the reforms was to improve the delivery of appropriate medical care to injured workers through an independent medical review process that is transparent and consistent and uses evidence-based medicine," said Dr. Rupali Das, DWC Medical Director. It is still too early to gauge the overall effect of SB 863 reforms. Revisions to the lien filing procedures, as well as the conflict of interest statute and the fee schedule changes, are expected to help reduce fraudulent behavior in the workers’ comp system.

The progress report is posted on the DIR website. Read More...

Employers' Fraud Task Force Announces August Event
Thu, 17 Jul 2014 11:58:37 - Pacific Time
The Employer's Fraud Task Force (EFTF) has scheduled its annual Fraud Fighting Conference for August 28th and 29th, at the Pala Casino Spa Resort in Pala California.

The event - "Risky Business. The Stakes Are High" - features industry leaders, players, movers and shakers as they bring you up-to-date on the games people play and the price you could be paying if the deck is stacked against you. What’s coming at you that you can’t see? Who’s bluffing? Who’s winning and who’s losing?

John Floyd, Senior Partner with FSK, will be speaking during the conference, and will be joined by industry experts such as John Riggs, Fraud Assessment Commissioner and Manager Workers' Comp, Disneyland Resort and Alex Rossi, the County of Los Angeles risk manager. Destie Overpeck, the Acting Administrative Director, Division of Workers' Compensation will be the luncheon speaker on the first day and will present her topic "Playing by the House Rules."

On the second day of the conference, Keynote Speaker, Christine Baker, the Director of the Department of Industrial Relations will discuss her topic "Is The Deck Marked? The Underground Economy." John Riggs, Jennifer Snyder, Deputy District Attorney, Los Angeles District Attorney's Office and Captain David Goldberg, Department of Insurance Fraud Division (Invited) will discuss "Games People Play - Who's Cheating and Why?"

For additional information and to attend, sponsor or exhibit contact: Laura Clifford, Phone/Fax 714.637.3350, Mobil 323.559.0015 or email at lauraclifford@sbcglobal.net. The Pala Resort and Casino is located at 11154 Highway 76 in Pala, California (North San Diego County). For Room Reservations call 877.725.2766. For special room rates mention code EMPH14A or Employers’ Fraud Task Force.

Stop by our Floyd, Skeren and Kelly booth to meet with some of our attorneys and to learn about our upcoming events. Read More...

Three Indicted in $50 Million Orange County Surgical Fraud Scheme
Thu, 17 Jul 2014 11:58:30 - Pacific Time
Three Orange County residents allegedly defrauded insurers by submitting bills for more than $50 million for medically unnecessary procedures, federal prosecutors said Wednesday in a 15-count indictment.

Charged were Vi Nguyen, 31, of Placentia (10 counts of mail fraud); Theresa Fisher, 44, of Tustin (five counts of mail fraud); and Lindsay Hargraves, 30, of San Pedro (two counts of mail fraud). Nguyen and Fisher were "consultants," Hargraves a marketer. All three were arrested on July 1 before the criminal complaint was unsealed. They were all released on bond. They are to be arraigned on July 28.

Prosecutors claim the defendants used marketers to lure patients to a surgery center in Orange, known at various times as Empire Surgical Center, Vista Surgical Center and Princess Cosmetic Surgery. These were different business names for the same surgery center, consisting of one consultation office and one surgical suite, located at 1310 W. Stewart Drive, Suites 309 and 310, Orange, California. "The marketers told patients that they could use their union or PPO health insurance plans to pay for cosmetic surgeries, which are generally not covered by insurance," the US. Attorney's Office said in a statement announcing the indictment.

At the center, prosecutors said, the patients were told they could get free or discounted cosmetic surgeries if they submitted to "multiple, medically unnecessary procedures that would be billed to their union or PPO health care benefit program." The health care programs were funded by the International Longshore and Warehouse Union and Pacific Maritime Association Welfare Plan as well as private programs such as Anthem Blue Cross Blue Shield and Horizon Blue Cross and Blue Shield of New Jersey. The plans generally did not cover cosmetic surgery.

The unnecessary procedures typical were endoscopies, colonoscopies and/or cystoscopies. The plastic surgeries included tummy tucks, falsely billed as hernia repairs; nose jobs, falsely billed as deviated septum repairs; breast surgeries and liposuction, prosecutors said. Empire, Vista, or Princess also allegedly billed union and PPO health care benefit programs for procedures that never were performed on patients. Read More...

Private Self-Insured Claim Rate Shows Little Change
Wed, 16 Jul 2014 05:54:34 - Pacific Time
California private self-insured indemnity claim frequency increased 7.6% in 2013, but the incidence of medical-only claims declined 4.7%, so the overall claim frequency rate for private self-insured employers showed little change from the 2012 level according to a CWCI analysis of data compiled by the California Office of Self Insurance Plans (OSIP).

OSIP’s annual summary offers the first look at private, self-insured claims experience for calendar year 2013, tracking a number of variables, including medical-only and indemnity claim volume as well as total payments and total incurred losses on those claims through the end of last year. The summary of 2013 claims experience covered 2.09 million workers employed by California private self-insured employers, which was down about 2% from 2012, but down nearly 26% from the 2.81 million employees covered in the initial report for 2005 – the first year following enactment of SB 899. Private self-insured employers reported a total of 76,015 claims last year, 1,542 fewer than in the 2012 initial report, and the lowest first report tally in the last 10 years.

To control for the effect of year-to-year changes in the number of covered employees on claim counts and to determine the claim frequency trend for the past decade, CWCI used the OSIP first report data from 2004 to 2013 to calculate the number of private self-insured claims per 100 employees. The results show a sharp decline in private self-insured claim frequency in the wake of the 2002-2004 reforms, followed by an increase from 2005 to 2007 as the medical-only claims rate rose. Since 2007, overall claim frequency for private self-insured employers is down 8.8%, primarily due to reductions in the medical-only claims rate. In contrast, from 2006 until last year, indemnity claim frequency remained relatively flat, ranging between 1.32 and 1.37 claims per 100 employees; but, in 2013, it registered the biggest increase in 10 years, jumping 7.6% to 1.42 claims per 100 employees – the highest level since 2005.

The decline in the covered work force also affected the total paid losses for 2013, as private self-insured employers reported that as of the end of the year they had paid $180.9 million ($76.7 million indemnity + $104.2 million medical) on 2013 claims -- 2.8% less than the $186.2 million recorded in the initial report for 2012 claims. That translates to an average payment of $2,380 for the 2013 claims at the end of the calendar year, less than 1% below the average for 2012, and only 4.2% below the 10-year high of $2,485 noted in the first reports for 2010 claims. A closer look at the first reports reveals that the private self-insureds averaged $1,009 in indemnity payments on their 2013 claims, 2.6% more than in 2012 and the highest level in the last 10 years; while medical payments on the 2013 claims averaged $1,371, 3.3% less than in 2012 and 8.6% less than 10-year high noted in 2010 -- but still 38.1% more than the post-reform low of $993 from 2005. Read More...

Progressive Medical and PMSI to Rebrand as Helios
Wed, 16 Jul 2014 05:54:26 - Pacific Time
Progressive Medical Inc. and PMSI Inc., two workers compensation pharmacy benefit managers that merged in October, will begin operating under the name Helios in August, according to a statement issued Tuesday. Helios is based in Memphis, Tennessee, and employs more than 1,400 workers nationwide, including at Progressive Medical’s Westerville, Ohio, location, PMSI’s Tampa, Florida, office and offices in Salt Lake City and Price, Utah, according to the Helios website. The rebranding will be fully effective Aug. 18.

"Our new name is the outcome of a thorough and deliberate process that involved a great deal of research," the company said in a statement posted online. "We considered a large number of concepts and in the end, selected Helios for its strong representation of our brand, the vigor in which we operate, and overall positive disposition."

"While our name and look are changing, our commitment to doing what’s right is unchanged," said Tommy Young, Co-CEO. "We will continue to provide exceptional service, proactively share intelligence with our clients to ensure they have the best information to manage their businesses, and deliver innovative solutions to effectively drive down costs and improve both clinical and financial outcomes."

The name was chosen because it embodies the vision, values, and personality of the organization and captures the legacies of the two companies, according to H. Barry Jarnigan, Chief Marketing Officer. "Helios captures the energy, strength, reliability, and consistency of our company as well as our passion and dedication for providing exceptional, accountable service."

Helios will be a new name in the workers’ compensation and auto no-fault markets; however, it will be built upon Progressive Medical and PMSI’s legacy of innovative products and exceptional service. Along with the name, the company will unveil a new logomark at the Workers’ Compensation Institute’s annual conference beginning August 18. Read More...

Past Week News Archive


Another Federal Agency - ICE - Botches Workers Compensation Claims: Tue, 15 Jul 2014 12:23:16 - Pacific Time: Read More...


DWC Now Accepting QMEApplications: Tue, 15 Jul 2014 12:23:10 - Pacific Time: Read More...


Surveillance Evidence Convicts Santa Barbara Roofer: Mon, 14 Jul 2014 11:32:40 - Pacific Time: Read More...


DWC Publishes Corrected Spanish Time of Hire Pamphlet: Mon, 14 Jul 2014 11:32:34 - Pacific Time: Read More...


Civil Lawsuits Claim Comp Doctors Used Fake Spine Surgery Hardware: Thu, 10 Jul 2014 09:36:33 - Pacific Time: Read More...


Veterans Administration Botches 60% Of Its Own Work Comp Claims: Thu, 10 Jul 2014 09:36:26 - Pacific Time: Read More...


Former Visalia Physician Pleads Guilty, Faces 20 Years in Drug Case: Wed, 9 Jul 2014 11:34:43 - Pacific Time: Read More...


California Has Mixed Scorecard in WCRI Medical Price Index Report: Wed, 9 Jul 2014 11:34:38 - Pacific Time: Read More...


WCAB Panel Rejects Jurisdiction Over Hospital Lien Claim: Tue, 8 Jul 2014 09:55:50 - Pacific Time: Read More...


Inspector General Warns About Electronic Health Records Potential for Fraud: Tue, 8 Jul 2014 09:55:43 - Pacific Time: Read More...