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Sara E. Razavi is an attorney based out of our Pasadena office. She was born and raised in Orange County, California and received her undergraduate degree in International Business from California State University, Long Beach. As fortune would have it, Sara was offered a full scholarship to Whittier Law School. She received her Juris Doctor in 2008, graduated with cum laude honor, and was also a Cali Award Recipient. She practices exclusively workers' compensation defense, and in her free time enjoys international travel, Crossfit, and yoga.


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Workers' Compensation Daily News for Aug 20, 2014

CHSWC Study Confirms Higher Comp Costs in Southern California Region
Wed, 20 Aug 2014 09:16:17 - Pacific Time
The Commission on Health and Safety and Workers' Compensation (CHSWC) has released on its website the 214 page study, "Examination of the California Public Sector Self-Insured Workers' Compensation Program" for public comment. This study was part of Senate Bill (SB) 863 Reforms, required by Labor Code Section 3702.4, to examine the public sector self-insured workers' compensation program and to make recommendations to improve the administration and performance of the program. CHSWC contracted with Bickmore to assist with this requirement.

Recent municipal bankruptcies have drawn attention to public entity employers and the adequacy of the resources they possess to meet their workers’ compensation obligations. It is unclear what the impact to employees and taxpayers would be in the event that large or multiple public entities become unable to provide for their workers’ compensation liabilities.The purpose of this study is to identify variances in the performance of public employers’ self insured workers’ compensation and to recommend areas for improvement. In addition, the study is to provide information that facilitates benchmarking public self-insured workers’ compensation programs.

The study found that a self-insurer’s region has a significant impact on the claims costs. Self-insurers in southern California have experienced higher claim frequency, higher average claim size, and higher overall cost per $100 of payroll. Over the past several years this disparity between southern California and the rest of the State has increased. In addition, claims of southern California self-insurers tend to stay open longer in comparison to those in the rest of the State. The analysis of insurance company data by the California Workers’ Compensation Insurance Rating Bureau (WCIRB) has also pointed to disparities between claim frequencies and costs between different regions of the State. The current analysis confirms that these disparities also exist for public self-insurers. Since one of the goals of the workers’ compensation system to have equal treatment of and benefits for injured workers, the authors believe it is worth exploring the root causes of this disparity.

The type of agency has a major impact on the loss rates, claims sizes, and claims frequencies. Municipalities tend to have the highest costs, whereas educational entities (schools, colleges, and universities) have the lowest. Over the past several years the cost of municipal claims has risen at a faster pace than that of counties or educational entities. This is primarily due to increases in the average claim size. Also, claims of education self-insurers tend to close faster in comparison to those of counties and cities.

In general, JPAs have experienced lower costs per $100 of payroll than individual self-insurers. However, JPA costs have been increasing at a faster rate than those of individual self-insurers over the past several years.

The study found almost no difference in loss rates between self-insurers that utilize a TPA versus those that self-administer. Those that self-administer tend to have a higher claim frequency, but this is offset by a lower average claim size. In addition, loss rates have been increasing at a slower pace for those that self-administer than for those that utilize a TPA. Read More...

DWC Sets Public Hearing on Outpatient and ASC Fee Schedule
Wed, 20 Aug 2014 09:16:10 - Pacific Time
The Division of Workers’ Compensation has issued a notice of public hearing to revise the recently amended hospital outpatient departments and ambulatory surgical centers (HOPD/ASC) fee schedule. The public hearing has been scheduled for 10 a.m., September 18, in the Auditorium of the Elihu Harris Building, 1515 Clay Street, Oakland, CA 94612. Members of the public may also submit written comment on the regulations until 5 p.m. that day.

As set forth in Labor Code section 5307.1(c)(1), the maximum facility fee for services performed in a hospital outpatient department, shall not exceed 120 percent of the fee paid by Medicare for the same services performed in a hospital outpatient department. Senate Bill 863 also required that for services rendered in ambulatory surgical centers on or after January 1, 2013, the maximum facility fee shall not exceed 80 percent of the fee paid by Medicare for the same services performed in a hospital outpatient department. Effective Jan. 1, 2013, the Acting Administrative Director amended the HOPD/ASC fee schedule (Title 8, California Code of Regulations, sections 9789.30 et seq.), to implement Senate Bill 863 as it relates to the OMFS HOPD/ASC fee schedule. Effective Jan. 1, 2004, the Administrative Director adopted the HOPD/ASC fee schedule (Title 8, California Code of Regulations, sections 9789.30 et seq.), which is updated annually by Administrative Director Order.

The objective of this rulemaking action is to amend the OMFS HOPD/ASC fee schedule to correct the payment methodology for “Other Services” that are paid according to the RBRVS Practice Expense relative value units. The RBRVS conversion factor should be applied in the payment methodology instead of the HOPD/ASC Workers’ Compensation Multiplier that was adopted by the HOPD/ASC fee schedule regulations. Correcting the payment methodology to include the application of the RBRVS conversion factor is beneficial because payment would otherwise be incorrectly calculated.

The notice and text of the regulation can be found on the proposed regulations page. Read More...

Broker Creates Fake Insurance Company to Steal Comp Premiums
Tue, 19 Aug 2014 08:25:01 - Pacific Time
Jacob Richard Bonzer, 27, formerly of Lake Forest, California was arrested this month in Chicago by the Chicago Police Department and a U.S. Marshals Task Force on 96 felony counts including grand theft, forgery and denial of benefits. If convicted, Bonzer faces a maximum sentence of more than 87 years in state prison. "Bonzer allegedly created more than a thousand insurance policies based on fraudulent information, which allowed him to collect $285,000 in unearned commission payments," said Insurance Commissioner Dave Jones.

A joint investigation between the California Department of Insurance, the Orange County District Attorney's Office and the Brea Police Department revealed Bonzer perpetrated several schemes for his personal financial gain.

Investigators discovered that in 2012 Bonzer created a fictitious insurance company called GW Mutual Risk Retention Group, LLC, which was registered in Florida. GW Mutual is not licensed to write insurance in California though Bonzer sold workers' compensation and commercial insurance policies through his agency, Bonzer Insurance Brokerage, located in Orange County. Bonzer collected approximately $280,000 in premium from 58 California businesses that believed they were purchasing valid coverage. When questioned by a client about GW's ability to offer insurance in California, Bonzer provided an altered CDI report of examination as proof. Department investigators also discovered premium payments entrusted to Bonzer were used on personal living expenses including the rental of luxury high-rise apartments, travel, wine clubs and fine dining.

"The fact Bonzer's criminal activity left legitimate businesses without valid workers' compensation insurance put business owners, their employees and the state at great financial risk. His multiple schemes to rip off insurers and businesses are egregious," said Commissioner Jones.

Bonzer also submitted 128 fraudulent homeowners insurance applications containing bogus information using nonexistent policyholders for real properties, causing valid policies to be issued for phantom homeowners in escrow between April and July 2010. Bonzer received $46,000 in advanced commissions from the insurance company that expected to collect premiums when the properties closed escrow. Since the applicants were bogus, the insurer never received premium payments and Bonzer was eventually fired. Investigators allege Bonzer continued his scam through another agent after he was fired. It was determined Bonzer created a fictitious mortgage company that referred all residential short-sale business to Bonzer for homeowners insurance. Bonzer used the same scheme leading the insurer to believe they would receive premium payments at the close of escrow. Numerous policies were resubmitted multiple times with an explanation that escrow closing had been delayed. In some cases Bonzer received duplicate commission payments for the same property. Between August 2010 and November 2011, approximately 790 fraudulent homeowners insurance applications, containing bogus information, were submitted by Bonzer under another agent. As a result Bonzer received commission payments of $239,000.

Bonzer orchestrated these elaborate scams by using multiple post office boxes, virtual assistants, business entities, office spaces, email accounts, Website domains and bank accounts. The department has reason to believe that there are additional victims. Anyone who did business with Jacob Bonzer or believe they may be a victim, are encouraged to contact Department of Insurance supervising investigator Vera Grunke at (714) 712-7600. Read More...

20% of Orthopedic Patients Doctor Shop for Opiates
Tue, 19 Aug 2014 08:24:46 - Pacific Time
"Doctor shopping," the growing practice of obtaining narcotic prescriptions from multiple providers, has led to measurable increases in drug use among postoperative trauma patients. The study, "Narcotic Use and Postoperative Doctor Shopping in the Orthopaedic Trauma Population," appearing in the August issue of the Journal of Bone and Joint Surgery(JBJS), links doctor shopping to higher narcotic use among orthopaedic patients. The data was presented earlier this year at the 2014 Annual Meeting of the American Academy of Orthopaedic Surgeons(AAOS).

"There has been an alarming rise in opioid use in our country, and the diversion of opioids for non-therapeutic uses is dramatically increasing," said lead study author, orthopaedic surgeon Brent J. Morris, MD. "Many suspect that orthopaedic trauma patients may be at a higher risk for pre-injury narcotic use and 'doctor shopping.'"

Researchers reviewed prescription records for 151 adult patients admitted to an orthopaedic unit at a Level 1 trauma center between January and December 2011. Using the Tennessee Controlled Substance Monitoring Database (CSMD), the study authors reviewed data on narcotic prescriptions obtained three months before, and within six months after, each patient's orthopaedic procedure. The research found that 20.8 percent of patients sought prescription pain medications from multiple providers. When compared to patients who continued to receive prescriptions and care from a single provider, the "doctor shoppers":

1) Used narcotics four times longer than single provider patients (112 days versus 28 days).
2) Obtained a median of seven narcotic prescriptions compared to two prescriptions for single provider patients.
3) Had a higher morphine equivalent dose (MED) of narcotics each day (43 milligrams versus 26 milligrams).
4) Were 4.5 times more likely to seek out an additional provider if they had a history of preoperative narcotic use.

The "doctor shopping" patients had an average age of 39.6 ±12.2 years, and were primarily white (89 percent) and male (63 percent). Forty-four percent were uninsured. There were no differences between the single-provider and multiple-provider groups with regard to age, sex, race, injury type, distance between the patient's home and treating hospital, tobacco use, psychiatric history (depression, anxiety, attention deficit hyperactivity disorder, or bipolar disorder), or comorbidities. "Our study determined that one out of five of our orthopaedic trauma patients obtained narcotic prescriptions from another provider after surgery while still receiving narcotic prescriptions from the treating surgeon," said Dr. Morris.

The negative consequences of narcotic use and diversion of narcotics for nonmedical use in the United States are growing at dramatic rates Americans consume 80% of the global opioid supply and 99% of the global hydrocodone supply. The alarming rise in unintentional overdose deaths in the United States, which increased 124% from 1999 to 2007, is largely due to increases in prescription narcotic overdoses. Up to 20% of prescription drug abusers receive their narcotic supply from a single physician prescriber, while a growing percentage obtains narcotic prescriptions by seeking multiple providers ("doctor shopping"). Read More...

DWC Proposes Modifications to MTUS Regulations
Mon, 18 Aug 2014 07:51:28 - Pacific Time
The Division of Workers’ Compensation has posted a first 15-day notice of modification to the proposed Medical Treatment Utilization Schedule (MTUS) regulations to the DWC website. Members of the public are invited to present written comments regarding the proposed modifications to dwcrules@dir.ca.gov until 5 p.m. on August 30.

The MTUS is established as the standard for the provision of medical care in the workers’ compensation system in accordance with Labor Code section 4600. The proposed amendments to the MTUS clarify the scientific process by which evidence-based clinical decisions are to be made when the MTUS is silent on a particular issue and describe how the MTUS may be rebutted pursuant to Labor Code section 4604.5.

The proposed regulations detail the methods to evaluate medical evidence according to an explicit, systematic, strength-of-evidence methodology to determine recommendations that are supported with the best available evidence. The intent of these regulations is to enable workers to achieve appropriate care that is supported by the best available medical evidence. The proposed modifications include:

1) Revision of the definition of "ACOEM" by deleting the reference to the second edition 2004 version and adding a brief description of what the guidelines contain.
2) Revision of the definition of "chronic pain" by adding a three month timeline from the initial onset of pain for clarity.
3) Deletion of the definition of "MEDLINE" because this term is no longer used in the regulations.
4) Modification of the definition of "Appraisal of Guidelines for Research and Evaluation II (AGREE II) Instrument" by adding the May 2009 AGREE II version was adopted and incorporated by reference into the MTUS by the Administrative Director and a copy may be obtained from DWC’s website or by written request to DWC’s Medical Unit.
5) Re-organization and re-wording to express that medical care shall be in accordance with the best available medical evidence when the MTUS’s presumption of evidence is challenged pursuant to Labor Code section 4604.5 or when there is a topical gap and a medical treatment or diagnostic test is not addressed by the recommended guidelines set forth in the MTUS.
6) Clarification that treating physicians may apply the medical literature search sequence, and specifies when Utilization Review physicians and Independent Medical Review physicians shall apply the medical literature search sequence to find the best available medical evidence.
7) Specifies when and by whom the MTUS Hierarchy of Evidence for Different Clinical Questions shall be applied and how the levels of evidence shall be documented in a Utilization Review decision and in an Independent Medical Review decision.

There was a public hearing on this regulations in July. The transcript reflects the testimony of seven individuals who had comments about the MTUS regulatory proposals. Ken Eichler, an official with the Official Disability Guidelines (ODG) was in "full support" of these guidelines. He was however concerned about who was required to rank the evidence. Steve Cattolica, a spokesman for medical providers had similar concerns.

The notice and text of the regulations can be found on the proposed regulations page. Read More...

Med Management Company Owner Guilty of $3.2 Million Fraud
Mon, 18 Aug 2014 07:51:20 - Pacific Time
The former owner of a Los Angeles medical clinic management company pleaded guilty in connection with his role in a scheme to defraud Medicare.

Assistant Attorney General Leslie R. Caldwell of the Justice Department’s Criminal Division, Acting U.S. Attorney Stephanie Yonekura of the Central District of California and Assistant Director in Charge Bill L. Lewis of the FBI’s Los Angeles Field Office made the announcement.

Mihran "Mike" Meguerian, 37, of Glendale, California, pleaded guilty before U.S. District Judge Beverly R. O’Connell in the Central District of California to one count of conspiracy to commit health care fraud.

According to court documents, Meguerian owned Med Serve Management (Med Serve), a medical clinic management company located in Van Nuys, California. Meguerian admitted that from approximately July 2008 through February 2009, he engaged in a conspiracy to commit health care fraud, in part through the operation of Med Serve. Meguerian admitted that he oversaw medical clinics that wrote prescriptions for medically unnecessary power wheelchairs and other durable medical equipment (DME). Meguerian and his co-conspirators then sold the prescriptions to DME supply companies, knowing that the prescriptions were fraudulent. The DME supply companies submitted the fraudulent prescriptions to Medicare in false and fraudulent claims.

From approximately July 2008 through February 2009, DME supply companies submitted approximately $3,367,661 in fraudulent claims to Medicare using fraudulent prescriptions from Meguerian’s clinics, and Medicare paid approximately $1,438,760 for those claims. Meguerian’s sentencing is scheduled for Nov. 17, 2014.

This case was investigated by the FBI and was brought as part of the Medicare Fraud Strike Force, which is supervised by the Criminal Division’s Fraud Section and the U.S. Attorney’s Office for the Central District of California. This case is being prosecuted by Trial Attorneys Fred Medick and Blanca Quintero of the Criminal Division’s Fraud Section.

Since its inception in March 2007, the Medicare Fraud Strike Force, now operating in nine cities across the country, has charged more than 1,900 defendants who have collectively billed the Medicare program more than $6 billion. In addition, HHS’s Centers for Medicare and Medicaid Services, working in conjunction with HHS-OIG, are taking steps to increase accountability and decrease the presence of fraudulent providers. Read More...

Will Florida Comp Ruling Become a National Trend?
Fri, 15 Aug 2014 13:09:59 - Pacific Time
Florida’s workers’ compensation law is unconstitutional, according to a ruling by a Miami-Dade judge on Wednesday, striking a severe blow to a law already under attack. No doubt this case has caught the attention of applicant attorneys nationwide, and the ruling may very well be a precursor to challenges here in California.

The Bradenton Herald reports that Circuit Judge Jorge Cueto declared Florida’s long-disputed workers’ compensation law unconstitutional; adding that after several years where state legislatures diminished medical care and wage-loss benefits for incapacitated workers, the statute now violates "fundamental" rights of employees. The case is based on a government office worker in Miami-Dade County who claims the nearly 80-year-old law forces injured workers into Florida’s legal system, which is so flawed it cannot provide adequate medical care or dollars to supplant lost wages. "The benefits in the act have been so decimated," says Cueto’s decision, "that it no longer provides a reasonable alternative" to filing suit in civil court.

The ruling comes at a critical time for Florida’s blue-collar and agricultural workers. Lawmakers and business leaders claim that rising workers’ compensation premiums threaten to disrupt economic growth; worker advocates argue the state allows widespread insurance fraud, while responding to high premiums by penalizing workers.

Workers’ comp reform is a years-long controversy, becoming more prominent as worker rights attorneys ask judges as far as the Florida Supreme Court, to strike down;the state law permanently.

Cueto’s ruling centers on an accounting clerk who, on Jan. 27, 2012, tripped in a walkway because a co-worker left boxes around the floor. Elsa Padgett, who had already approached retirement age, fell on her hip, sustaining serious shoulder damage as well. After shoulder replacement surgery, Padgett continued to suffer pain, which eventually forced her to retire.

If the ruling is appealed, Cueto’s order joins a minimum of two other cases challenging the constitutionality of parts of the state workers’ compensation statute.The Florida Supreme Court is already considering an appeal filed by Bradley Westphal, a St. Petersburg firefighter with severe and disabling back injuries incurred in 2009. After temporary wage-loss benefits had expired, Westphal was left with no income. Doctors through his insurance carrier said he could not seek work, and the insurance carrier refused to provide benefits until doctors confirmed he would no longer improve medically.

"This system of redress does not comport with any notion of natural justice, and its result is repugnant to fundamental fairness, because it relegates a severely injured worker to a legal twilight zone of economic and familial ruin," said the February 2013 opinion from a three-judge Tallahassee appeals court striking down the statute. Later, the full court restored the law, but the case is now before the state’s highest court.

Florida lawmakers amended state law in 1968, making the workers’ comp system the "exclusive" legal remedy when employees are injured on the job. At that time, the law was far more generous, requiring employers to pay all medical bills and considerably better benefits to workers who lost either all or part of their ability to work. However, the Legislature made changes in 1990, 1993 and 2003 removing large portions of injured workers’ benefits. Lawmakers justified the reductions as necessary to keep Florida competitive with other states, to retain or lure business. Since revisions to the law made in 2003, premiums dropped 56 percent.

Attorney General Pam Bondi chose not to intervene directly in Cueto’s case, but her office defended the statute, maintaining, "While some individual workers may be worse off with workers’ compensation in a particular instance, others benefit greatly."

In his order, Cueto said lawmakers had violated their side of the "trade" with workers - where employees relinquish the right to sue in civil court after an injury, but then get fast, efficient and no-fault justice. Business interests began carving up the safety net in place in 1968, when employers reached the bargain. "The purpose of a workers’ compensation act is not for it to be used as a weapon in an economic civil war," Cueto concluded. "Its purpose is to provide adequate compensation for on-the-job injuries in place" of a worker’s ability to sue in civil court. Read More...

Feds Highlight Fraud Data Mining Strategies
Fri, 15 Aug 2014 13:09:52 - Pacific Time
Eleven armed FBI agents crept around a stone-and-glass house here just before dawn. An AR-15 rifle and four other guns were registered to the man in the house. "FBI warrant," the agents called out, and a man in a T-shirt and shorts emerged. It was no drug lord. The target was a doctor who moonlighted as a movie producer with an Alec Baldwin comedy to his credit. The Justice Department charged the Southern California doctor, Robert A. Glazer, with writing prescriptions and certifications resulting in $33 million of fraudulent Medicare claims. The raid in May capped a year-long investigation by the Medicare Fraud Strike Force, a joint effort by the Justice Department and Department of Health and Human Services.

The story in the Wall Street Journal says that many strike-force investigations, including the Glazer case, start with an agent behind a computer screen, eyeing page after page of Medicare claims data, looking for unusual billing patterns. The Glazer case comes as the strike force increasingly targets physicians. "You need a doctor in all the schemes," said David A. O'Neil, a deputy assistant attorney general for the criminal division who supervises strike-force prosecutions. He said the team charged 36 doctors with health-care fraud in the 2013 fiscal year, compared with just three in 2007, when many cases dug into fraud involving durable medical equipment such as wheelchairs.

The strike force's Los Angeles team includes about 20 investigators and prosecutors working out of multiple offices, including a shiny tower in the suburbs near a strip mall dotted with family restaurants and chain stores. Last fiscal year, the strike force's nine offices charged 350 people with health-care fraud, up from 122 charged when the strike force had just two offices. One agent described dealing with the voluminous number of potential cases as "Whac-A-Mole."

Dr. Glazer attracted attention from authorities long before this year's charges. In 1994, he was indicted with six others for an alleged referral scheme between 1986 and 1993. He was accused of paying $73,454 to a marketer during one 3½-year stretch to send him patients, according to California Superior Court documents obtained through a public-records request. Court documents indicate that the case was dismissed after a judge ruled that the prosecution's witness testimony was inadmissible. Dr. Glazer was never excluded from billing Medicare, but patient complaints over billing prompted CMS several years ago to place him on "prepayment review," according to people familiar with the situation. That meant any claims made to Medicare were manually reviewed by CMS contractors, a measure intended to prevent improper billing. Dr. Glazer was removed from the review list around 2009, these people said, although it isn't clear whether CMS decided to take him off or if he appealed to an administrative judge. CMS said it doesn't comment on administrative actions against individual providers. It is difficult to permanently ban a provider from Medicare. A criminal conviction or a loss of a state medical license can provide grounds to take a provider out of the system, and CMS can revoke billing privileges for reasons such as failing to comply with Medicare rules. Since 2011, CMS has revoked about 20,000 providers. But a provider can eventually appeal or reapply to return to the program.

The strike force began investigating him after sorting through years of his payment claims in the Medicare database, according to people familiar with the investigation. Such database searches look for "the sort of medically impossible or medically unlikely scenario," said Supervisory Special Agent Robin McIlroy, who oversees the FBI's part of the strike force. Between 2006 and 2014, Dr. Glazer's family practice billed Medicare about $2 million, according to an affidavit by FBI Special Agent Janine Li, who was part of the investigation team. Between 2006 and 2014, Dr. Glazer's family practice billed Medicare about $2 million, according to an affidavit by FBI Special Agent Janine Li, who was part of the investigation team.

When agents cross-referenced his Medicare provider number with other parts of the database - including claims data for home-health agencies, hospice and durable medical equipment - large billing numbers stood out, according to a person familiar with the investigation. "Once you start crunching the data, you start to see everything," said Mr. Ferry, the special agent-in-charge. In the same eight-year time period, Dr. Glazer's referrals to home health-care companies resulted in billings to Medicare for $16.5 million, and referrals to medical-equipment companies resulted in billings of about $5.4 million, the FBI's Ms. Li said in her affidavit. Hospice services added up to about $10 million, according to a person familiar with the case.

Outliers popped up in the data. Using Dr. Glazer's prescriptions, Medicare paid $2.5 million to one home-health agency down the hall from his office, while a local hospice was the recipient of nearly all his referrals, according to the person familiar with the case. Generally referrals are more spread out between multiple providers, said a person familiar with health-care fraud. The volume of motorized-wheelchair prescriptions in the data stunned the agents—an average of 134 a year, compared with a typical doctor working with elderly people who prescribed as few as one or two, according to the affidavit.

As the investigation progressed, agents in unmarked cars drove to Dr. Glazer's clinic in Hollywood and watched. Located in a strip mall, along with a Salvadoran fast-food restaurant, a check cashier and a medical-supply company, the office received many elderly patients who spoke English as a second language, said the people familiar with the investigation. The agents interviewed patients drawn from the data, and a common allegation emerged: Dr. Glazer was billing Medicare for patient services sometimes never rendered and farming out patients to other providers, according to the indictment. Read More...

WCIRB Suggests 6.7% Average Pure Premium Rate Increase
Thu, 14 Aug 2014 08:59:05 - Pacific Time
The WCIRB Governing Committee voted to authorize the WCIRB to submit a January 1, 2015 Advisory Pure Premium Rate Filing to the California Insurance Commissioner.

The Filing will propose advisory pure premium rates that average $2.86 per $100 of payroll, which is $0.29 or 11.4% greater than the corresponding industry average filed pure premium rate of $2.57 as of July 1, 2014, and $0.18 or 6.7% greater than the average January 1, 2014 advisory pure premium rate of $2.68. The proposed average pure premium rate reflects a deterioration of $0.12 or 4.4% from the WCIRB’s indicated January 1, 2014 average pure premium rate reflected in the WCIRB’s amended January 1, 2014 Pure Premium Rate Filing.

Chief Actuary Dave Bellusci cited several factors that are driving this deterioration in the indicated pure premium including:

1) Continued adverse medical loss development
2) More complete recognition of long-term medical paid loss development patterns
3) Continued high levels of indemnity claim frequency
4) Higher than anticipated loss adjustment expense inflation in part attributed to less than projected frictional costs savings resulting from Senate Bill No. 863 (2012)
5) Lower wage growth than the original forecast
6) Increase in indicated experience rating plan off-balance

The Filing reflects statewide loss and loss adjustment expense experience valued as of March 31, 2014; however, Mr. Bellusci advised the Committee that the WCIRB will continue monitoring insurer experience and may amend the Filing once it has analyzed experience valued as of June 30, 2014.

The WCIRB will submit its January 1, 2015 Pure Premium Rate Filing to the California Department of Insurance (CDI) on or around August 18, 2014. The CDI will schedule a public hearing to consider the Filing and once the Notice of Proposed Action and Notice of Public Hearing is issued, the WCIRB will post a copy in the Regulatory Filings section of the website (www.wcirb.com). Read More...

Beauty Pageant Contestant Charged With Comp Fraud
Thu, 14 Aug 2014 08:58:59 - Pacific Time
Pageant contestants seek the spotlight, but it was the limelight -- on the Internet -- that proved to be the incriminating evidence against a beauty pageant contestant collecting worker's compensation for a fractured toe.

Shawna L. Palmer of Riverside started collected workers’ compensation benefits in March after fracturing her toe as a clerk at Stater Bros. Markets, according to a news release from the California Department of Insurance. She told her doctor during multiple visits that she couldn’t put weight on her foot or wear shoes for an extended period of time.

But a YouTube video of the 2014 Miss Toyota Long Beach Grand Prix beauty contest showed otherwise: She was seen walking around in high heels "without any signs of discomfort," according to the Department of Insurance. "This suspect made the job of our departments' detectives easier by openly participating in high profile events," Insurance Commissioner Dave Jones said in a statement.

The news release said 22-year-old Palmer participated in at least two beauty contests while collecting workers’ compensation, even though her doctor had provided her an orthopedic boot, crutches and instructed her not to work.

According to officials, Shawna Lynn Palmer claimed to her employer March 10 that she was unable to continue working due to a foot injury she sustained as a clerk at Stater Bros. During multiple doctors visits, Palmer said she could not place any weight on her foot, could not wear any type of shoe for a period of time and could not move it in any direction. Palmer’s doctor provided her with an orthopedic shoe and crutches, and ordered her to refrain from working, along with elevating her foot whenever possible.

While collecting benefits, Palmer participated in at least two beauty contests, where she was seen walking in high heels without any signs of discomfort. It was the unusual delay back to work, however, that led investigators to look closer into the claim. Palmer was arrested after video evidence revealed her participation in the 2014 Miss Toyota Long Beach Grand Prix beauty contest.

If convicted, Palmer faces up to one year in county jail, three years of probation and must pay $24,000 in restitution. Read More...

Past Week News Archive

Convicted Claimant Fakes Robbery - Then Fakes PTSD Claim: Tue, 12 Aug 2014 12:51:49 - Pacific Time: Read More...

DWC Posts Annual WCJ Ethics Report: Tue, 12 Aug 2014 12:51:43 - Pacific Time: Read More...

WCAB Rules Parties May Stipulate to Use AME Instead of IMR Process: Mon, 11 Aug 2014 12:27:51 - Pacific Time: Read More...

Employers Holdings California Comp Strategy Pays Off: Mon, 11 Aug 2014 12:27:45 - Pacific Time: Read More...

Court of Appeal Limits Definition of LC 4558 Power Press Exception: Fri, 8 Aug 2014 11:08:51 - Pacific Time: Read More...

Commercial Insurance Broker Pleads Guilty to Embezzling Premiums: Fri, 8 Aug 2014 11:08:44 - Pacific Time: Read More...

DME Company Owner Found Guilty in a 10-Year, $8.3 Million Fraud Scheme: Thu, 7 Aug 2014 19:37:37 - Pacific Time: Read More...

Independent Medical Review Records Submission Process Improved: Thu, 7 Aug 2014 09:19:33 - Pacific Time: Read More...

Insurers Consider Cost-Effectiveness of Commercial Weight Loss Strategies: Thu, 7 Aug 2014 09:19:27 - Pacific Time: Read More...

WCAB Proposes Repeal of Rules of the Court Administrator: Wed, 6 Aug 2014 09:39:49 - Pacific Time: Read More...