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Laura Banker is an associate attorney in our firm's Orange office. She earned her undergraduate degree from the California State University, Sacramento and her Juris Doctorate Degree at New England School of Law in Boston, Massachusetts. She graduated cum laude from both schools. Ms. Banker became a member of the both the California State Bar and Massachusetts Board of Bar Overseers in 1996. Ms. Banker practiced Civil Litigation for many years and began practicing Workers' Compensation law in 2000. Her experience includes litigating cases as exclusive in-house counsel and specializing in Workers' Compensation and subrogation matters. Ms. Banker has also represented third party administrators, insurance companies, employers, self-insured entities, and public entities, including cities, school districts and water districts, in all aspects of Workers' Compensation defense and Subrogation matters, including standard workers' compensation defense, § 132a discrimination claims, and serious and willful misconduct allegations.

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Workers' Compensation Daily News for Aug 24, 2016

Indemnification Clause Obligates Employer to Pay Injured Employee Tort Claims
Tue, 23 Aug 2016 12:31:40 - Pacific Time
Aluma Systems Concrete Construction of California entered into an agreement with Nibbi Bros. Inc. to design and supply the materials for wall formwork and deck shoring at Nibbi Bros. Inc. construction project.

The terms of the Contract included an indemnification provision that required Nibbi to defend, indemnify and hold harmless Aluma against any and all claims, actions, expenses, damages, losses and liabilities, including attorneys fees and expenses, for personal injuries rising from or in connection with this contract "except to the extent such claims, actions, expenses, damages, losses and liabilities are caused by the acts or omissions of [Contractor]..."

Subsequently, two lawsuits were filed by Nibbi employees against Aluma alleging that in August 2011, the employees were injured after a shoring system designed by Aluma collapsed. The Employee Lawsuits alleged the collapse was due to Aluma’s negligence. Aluma tendered the Employee Lawsuits to Nibbi for defense and indemnification, but received no response.

Subsequently, Aluma sued Nibbi for indemnification based on a specific provision in the parties’ contract. The trial court sustained Nibbi’s demurrer to Contractor’s complaint without leave to amend, relying on the allegations in the underlying lawsuit that set forth claims only against Aluma and not against Nibbi the employer. Thus they argued that the exception applied since the allegations claim only "acts or omissions" of Aluma.

The Court of Appeal reversed and remanded in the published case of Aluma Systems Concrete Construction v Nibbi Bros. Inc.

The parties agreed that pursuant to Labor Code section 3864, an employer is only liable to indemnify a contractor pursuant to the terms of the contract. They dispute whether the indemnity provision - which applies to claims and damages in connection with the Contract "except to the extent" they are "caused by the acts or omissions of Aluma - applies to the Employee Lawsuits.

Nibbi argues the Employee Lawsuits allege solely Aluma’s negligence and the indemnification provision therefore does not apply. Aluma argues that the provision may apply because Aluma is jointly and severally liable for all economic damages in the Employee Lawsuits, including any attributable to the negligence of Nibbi or others, as long as Aluma’s negligence is partially responsible.

Because the employees were working for Employer at the time of their injuries, they cannot sue Employer for damages but must pursue benefits through the workers’ compensation system. This limitation on Employer’s liability does not extend to third parties, however, and the employees may sue Contractor for damages caused by its negligence.

Here the indemnification provision applies to "claims: and the Employer argues this indicates the allegations of the Employee Lawsuits control the provision’s application. But the provision also requires indemnification for Contractor’s "damages" and "losses."

The court of appeal concluded that there is "no basis to restrict the damages and losses so indemnified to the allegations of the Employee Lawsuits, rather than to the damages Contractor is ultimately found liable for." Read More...

Pasadena Physician Sentenced to Four Years in Fraud Case
Tue, 23 Aug 2016 12:31:35 - Pacific Time
A doctor from Pasadena who falsely certified that at least 79 Medicare and Medi-Cal patients were qualified for hospice care because they were terminally ill - when, in fact, the vast majority of them were not dying - has been sentenced to four years in federal prison.

Boyao Huang, 43, was sentenced on Monday by United States District Judge S. James Otero. In addition to the prison term, Judge Otero ordered Huang to pay $1,344,204 in restitution.

At the conclusion of a two-week trial in May, Huang was found guilty of four counts of health care fraud for participating in a scheme related to the Covina-based California Hospice Care (CHC). Between March 2009 and June 2013, CHC submitted approximately $8.8 million in fraudulent bills to Medicare and Medi-Cal for hospice-related services, and the public health programs paid nearly $7.4 million to CHC.

A second doctor who was convicted at trial - Sri Wijegoonaratna, known as Dr. J., 61, of Anaheim, who was found guilty of seven counts of health care fraud - is scheduled to be sentenced by Judge Otero on February 13, 2017.

"This scheme preyed upon dozens of patients and their families who were led to believe that their worst nightmare had come true - that they had life-ending illnesses," said United States Attorney Eileen M. Decker. "Criminals such as the defendants in this case who steal from taxpayers by defrauding the Medicare system and who victimize vulnerable individuals like medical patients deserve significant prison sentences."

In addition to the two doctors, eight other defendants were charged in the scheme and have pleaded guilty to health care fraud charges. Those other defendants include a Placentia woman who purchased CHC in 2007 and operated the facility after being charged and incarcerated in another health care fraud scheme. Priscilla Villabroza, 70, who pleaded guilty in December 2015 to one count of health care fraud, was sentenced in June to eight years in federal prison.

As part of the CHC fraud scheme, Villabroza and her daughter - who was the nominal owner while Villabroza was in custody - paid patient recruiters known as "marketers" or "cappers" to bring in Medicare and Medi-Cal beneficiaries. CHC nurses performed "assessments" to determine whether the beneficiaries were terminally ill and, regardless of the outcome, Wijegoonaratna and Huang certified that the beneficiaries were terminally ill - even though the vast majority of them were not dying. CHC personnel altered medical records in response to Medicare audits to make the beneficiaries appear sicker.

By the time the scheme was shut down in June 2013, Medicare and Medi-Cal had paid millions of dollars for medically unnecessary hospice-related services.

The investigation into California Hospice was conducted by the United States Department of Health and Human Services, Office of Inspector General; the Federal Bureau of Investigation; the California Bureau of Medi-Cal Fraud & Elder Abuse; and IRS Criminal Investigation.

This case is being prosecuted by Assistant United States Attorney Steven M. Arkow of the Major Frauds Section and Assistant United States Attorney Leon W. Weidman, Special Counsel to the United States Attorney. Read More...

Indicted or Convicted Criminals Filed $600 Million in Liens
Mon, 22 Aug 2016 09:44:34 - Pacific Time
The Department of Industrial Relations and its Division of Workers' Compensation reported that $600 million in liens against injured employees' claims for workers' compensation benefits have been filed by convicted or criminally indicted parties from 2011 through 2015.

"While California has made great strides in increasing benefits to injured workers, improving appropriate care and reducing employers' costs, we are pursuing legislation to prohibit criminal and indicted providers from lining their pockets through liens and to address the assignment of liens," said Christine Baker, DIR Director.

California's workers' compensation law allows certain claims for payment of services or benefits provided to or on behalf of injured workers to be filed as a lien against an employer in an employee's claim for workers' compensation benefits.  The filing of a lien generates collateral litigation between the lien filer and defendant (insurer or employer) over the validity of the claim and the necessity, extent and value of any services provided.  The parties may then settle on an amount due or adjudicate the dispute in a lien trial before the Workers' Compensation Appeals Board.

SB 863 (De León), which took effect on January 1, 2013, included a number of provisions to reduce costs by reducing the volume of lien claims and lien claim litigation in the workers' compensation system, including the reestablishment of lien filing fees to preclude frivolous lien filings, creation of an Independent Bill Review system to remove most billing disputes from litigation, and restrictions on the ability of third parties to collect on assigned lien claims.

Despite these efforts, the 68 businesses comprising the top one percent of lien filers filed more than 273,000 liens totaling $2.5 billion in accounts receivable on adjudicated cases between 2013 and 2015.  Two of the business owners are indicted and three others have pled guilty.  Legislation is underway to stay liens of physicians or providers who are criminally charged with workers' compensation fraud, medical billing fraud, insurance fraud, and Medicare or Medi-Cal fraud.

Assignments of Accounts Receivables are proving fertile ground for fraud

The assignment of liens by service providers to those who file and collect on liens are, in essence, the buying and selling of injured workers' treatments and fertile ground for presenting fraudulent claims.  DIR's review of filing dates indicates that lien claimants tend to wait until after the primary case is settled rather than seeking early resolution of medical necessity.  Even if lien claimants - especially those who bundle and buy or sell accounts receivables - only make pennies on the dollar, returns can still be high.  

DIR say it is leading an effort to identify and address strategies for improved anti-fraud efforts in the workers' compensation system. DIR and the Department of Insurance convened working groups in June to gather stakeholder input and evidence of fraudulent activity in the system.  At the direction of the Secretary of the California Labor and Workforce Development Agency, DIR will be preparing a report on further recommendations to the Governor and the Legislature by no later than Fall of 2016. Read More...

Indian Tribe PEO Organizer Gets Prison Sentence
Mon, 22 Aug 2016 09:44:25 - Pacific Time
Former Roseville businessman Gregory J. Chmielewski had what seemed like a brilliant idea: Create an alternative low-cost version of workers’ compensation insurance, at a time when the price for traditional coverage was soaring out of sight in California. Chmielewski was one of a handful of entrepreneurs who thought they could profit from the crisis by partnering with Indian tribes. He convinced the Fort Independence Community of Paiute Indians, in Inyo County, to bankroll a company that would offer discount coverage by using tribal laws to cut through the red tape plaguing the state-run system.

The company they created, Independent Staffing Solutions of Roseville, signed up dozens of clients but fell apart after four years in business. Independent Staffing was unable to pay its bills despite hauling in $225 million in revenue from employers during its brief life.

What went wrong? In a written plea agreement filed in U.S. District Court in Sacramento, Chmielewski said he siphoned $7.3 million from Independent Staffing in order to fund his personal real estate investments.

And last week he was sentenced by U.S. District Judge Garland E. Burrell Jr. to three years and five months in prison for mail fraud in connection with his misappropriation of funds from his insurance business into his own personal accounts for his personal use,

Chmielewski set up a professional employer organization called Independent Management Resources (IMR), later operating under the name Management Resources Group (MRG). He diverted and misappropriated millions of dollars from MRG accounts for his personal use. He caused over $7.3 million to be paid out of MRG’s accounts to other unrelated companies that he controlled. Eventually, the company experienced serious cash flow problems and was forced to cease operations, leaving approximately 117 injured workers with approximately $1.8 million in unpaid claims.

Acting U.S. Attorney Talbert stated: "Many of the victims harmed in this scheme were companies in California’s construction industry, whose employees worked as roofers, general laborers, and other jobs where injuries can occur. The defendant’s actions left many injured workers without the benefits they expected and deserved. Our office is committed to prosecuting large-scale schemes such as this that hurt employers and workers alike."

"The license to operate a business is not a license to steal from those whom you are hired to protect," said Cindy S. Chen, Acting Special Agent in Charge, IRS Criminal Investigation. "The misconduct of Chmielewski harmed those that needed his help during a time they were very vulnerable. Today’s sentence demonstrates IRS Criminal Investigation’s determination to combat financial fraud in all types of schemes."

This case was the product of an investigation by the United States Postal Inspection Service; the Internal Revenue Service, Criminal Investigation; and the California Department of Insurance. Assistant U.S. Attorneys Heiko P. Coppola and André Espinosa prosecuted the case. Read More...

Yet Another Study Questions Value of Meniscus Surgery
Thu, 18 Aug 2016 08:57:14 - Pacific Time
A new study published in the British Medical Journal says that exercise therapy is as effective as surgery for middle aged patients with a common type of knee injury known as meniscal tear (damage to the rubbery discs that cushion the knee joint).

The researchers suggest that supervised exercise therapy should be considered as a treatment option for middle aged patients with this type of knee damage.

According to the story reported in Medical News Today, every year, an estimated two million people worldwide undergo knee arthroscopy (keyhole surgery to relieve pain and improve movement) at a cost of several billion US dollars. Yet current evidence suggests that arthroscopic knee surgery offers little benefit for most patients.

So researchers based in Denmark and Norway carried out a randomized controlled trial to compare exercise therapy alone with arthroscopic surgery alone in middle aged patients with degenerative meniscal tears.

A randomized controlled trial is one of the best ways for determining whether an intervention actually has the desired effect.

They identified 140 adults (average age 50 years) with degenerative meniscal tears, verified by MRI scan, at two public hospitals and two physiotherapy clinics in Norway. Almost all (96%) participants had no definitive x-ray evidence of osteoarthritis.

Half of the patients received a supervised exercise program over 12 weeks (2-3 sessions each week) and half received arthroscopic surgery followed by simple daily exercises to perform at home.

Thigh muscle strength was assessed at three months and patient reported knee function was recorded at two years.

No clinically relevant difference was found between the two groups for outcomes such as pain, function in sport and recreation, and knee related quality of life. At three months, muscle strength had improved in the exercise group. No serious adverse events occurred in either group during the two-year follow-up.

Thirteen (19%) of participants in the exercise group crossed over to surgery during the follow-up period, with no additional benefit.

"Supervised exercise therapy showed positive effects over surgery in improving thigh muscle strength, at least in the short term," say the authors. "Our results should encourage clinicians and middle aged patients with degenerative meniscal tear and no radiographic evidence of osteoarthritis to consider supervised structured exercise therapy as a treatment option."

How did this situation - widespread practice without supporting evidence of even moderate quality - come about, ask two experts in a linked editorial? "Essentially, good evidence has been widely ignored," say Teppo Järvinen at the University of Helsinki and Gordon Guyatt at McMaster University in Canada.

"In a world of increasing awareness of constrained resources and epidemic medical waste, what we should not do is allow the orthopaedic community, hospital administrators, healthcare providers, and funders to ignore the results of rigorous trials and continue widespread use of procedures for which there has never been compelling evidence," they conclude.

Medical care under the California workers' compensation system is based upon evidence based medicine.  One would hope that the UR and IMR process has physicians who are aware of the findings of these studies when they make a decision to allow or turn down a request for treatment. Read More...

New Study Supports Apportionment in Degenerative Joint Disease Claims?
Thu, 18 Aug 2016 08:57:07 - Pacific Time
Osteoarthritis (OA), also known as degenerative joint disease, is a condition in which cartilage - the tissue that protects the end of each bone in a joint - wears away, causing the underlying bones to rub together. This can cause pain, swelling, and poor joint movement.

As the condition worsens, the bones may lose shape. Additionally, growths called bone spurs may arise, and bits of bone and cartilage can break off and float around the space in the joint. This can trigger an inflammatory response that exacerbates pain, as well as cartilage and bone damage.

OA is the most common form of arthritis in the United States, affecting around 27 million American adults. While the condition can arise in all age groups, it is most common among people aged 65 and older.

There is no cure for OA, only therapies that can help manage symptoms. These include pain and anti-inflammatory medications, such as nonsteroidal anti-inflammatory drugs (NSAIDs) and corticosteroids. In some cases, joint surgery may be required.

Osteoarthritis is often a factor in workers' compensation orthopedic claims, especially claims based on a continuous trauma theory. While it is true that OA may be aggravated by work factors, at the same time the permanent disability benefit can be apportioned to causation.

An now a new medical study reveals new information about the causation of OA.

A report in Medical News Today says that researchers have uncovered evidence that cellular senescence - whereby cells stop dividing - is a cause of osteoarthritis, and they suggest targeting these cells could offer a promising way to prevent or treat the condition.

Cellular senescence is the process by which cells stop dividing. Senescent cells accumulate with age and can cause severe damage to tissues and organs, contributing to a number of age-related diseases.

Study co-author Dr. James Kirkland, director of the Robert and Arlene Kogod Center on Aging at Mayo Clinic in Rochester, MN, and colleagues publish their findings in The Journals of Gerontology, Series A: Biological Sciences and Medical Sciences.

"Osteoarthritis has previously been associated with the accumulation of senescent cells in or near the joints, however, this is the first time there has been evidence of a causal link. We believe that targeting senescent cells could be a promising way to prevent or alleviate age-related osteoarthritis. While there is more work to be done, these findings are a critical step toward that goal."

The concept that there is a relationship between degenerative joint disease and aging is not new. However, apportionment to the aging process is difficult in litigation when faced with arguments that the aging process alone as a causative factor is "speculative." However, adding an understanding of the cellular mechanism behind degenerative joint disease to the apportionment argument in litigation weighs in on the side that any speculation is now less likely. Read More...

WCAB Permits Settlement of SJDB With "Thomas" Finding
Wed, 17 Aug 2016 08:11:10 - Pacific Time
Juan Pablo Beltran filed an Application alleging he sustained an industrial cumulative trauma injury to his head and back due to repetitive heavy work while employed as a laborer by Structural Steel Fabricators. The employer denied applicant's claim based upon the affirmative defense that applicant did not report the injury prior to his termination for cause.

The parties submitted a walk through Compromise and Release Agreement settling applicant's claim for $12,500.00, which included his potential entitlement to a Supplemental Job Displacement Benefit voucher. Upon receipt of the Compromise and Release Agreement, the WCJ suspended action on the settlement agreement and set the matter for trial, noting on March 24, 2016, that the parties may not settle or commute the Supplemental Job Displacement Benefit voucher. The WCJ then reset the matter for a status conference after defendant filed a Petition for Removal.

According to the WCJ's Report and Recommendation on Petition for Reconsideration, the WCJ requested defendant strike the language that applicant was not entitled to a Supplemental Job Displacement Benefit voucher. When defendant would not agree, the WCJ approved the Compromise and Release Agreement with the additional language, "Parties may not settle or commute SJDV per LC §4658.7(g) CCR§10133.31 (h)."

The WCAB granted reconsideration in the panel decision of Juan Pablo Beltran v Structural Steel Fabricators and SCIF.

In 2012 the Legislature passed SB863 which amended the provisions of workers' compensation law pertaining to Supplemental Job Displacement Benefits, which replaced vocational rehabilitation benefits that were terminated in 2004. A provision was added prohibiting the settlement or commutation of a claim for the Supplemental Job Displacement Benefit voucher. According to the Assembly Floor Analysis, the prohibition on settlement of the Supplemental Job Displacement Benefit voucher was to prevent the "cashing out" of the retraining voucher.

Defendant argues on reconsideration that where there is a good faith dispute as to the compensability of a claim of injury, the parties should be permitted to settle applicant's entitlement to the Supplemental Job Displacement Benefit voucher, analogizing to the situation which existed with respect to the settlement of vocational rehabilitation benefits that was addressed in Thomas v. Sports Chalet (1977) 42. Cal.Comp.Cases 625 [Appeals Board En Banc].

The prohibition against settlement of the Supplemental Job Displacement Benefit voucher is analogous to the prohibition against settlement of vocational rehabilitation benefits, which Thomas held could be resolved in a Compromise and Release Agreement only when a serious and good faith issue exists, which if resolved against the applicant would defeat all right to compensation.

Here, an injured worker's entitlement to the Supplemental Job Displacement Benefit voucher is conditioned upon both the acceptance of liability for a claimed industrial injury by the employer and the existence of permanent partial disability, or a determination of these issues after trial. Where an employer denies liability and raises an affirmative defense that could potentially defeat all right to compensation, a prohibition on settlement of the Supplemental Job Displacement Benefit voucher would require a trial to determine injury and the existence of permanent partial disability in every case. The Board in Thomas recognized that this would result in "effectively doing away with settlements," despite the existence of good faith disputes that could totally bar recovery.

Accordingly, we hold that, as in Thomas, where the trier of fact makes an express finding based upon the record that a serious and good faith issue exists to justify a release, a compromise and release agreement may be: approved by the Board which will relieve the employer from liability for the Supplemental Job Displacement Benefit voucher. Read More...

9th Circuit Says DOJ Cannot Prosecute Marijuana Violators
Wed, 17 Aug 2016 08:11:02 - Pacific Time
The 9th Circuit Court of Appeal, which presides over California and other western states, just ruled that the Department of Justice cannot spend money to prosecute people who violate federal drug laws but are in compliance with state medical marijuana laws. The ruling in US v Steve McIntosh et. al, prevents federal law enforcement from funding prosecution of anyone who obeys a state’s medical marijuana laws.

Despite laws passed by various states to the contrary, the sale of marijuana is still illegal under federal law. However, in 2014 congress passed a budget rule which prohibits the Department of Justice from using federal funds to interfere in the implementation of state marijuana regulations.

The ruling involves ten cases that are consolidated interlocutory appeals and petitions for writs of mandamus arising out of orders entered by three district courts in two states within our circuit. All Appellants have been indicted for various infractions of the federal Controlled Substances Act (CSA). They have moved to dismiss their indictments or to enjoin their prosecutions on the grounds that the Department of Justice (DOJ) is prohibited from spending funds to prosecute them.

In McIntosh, five codefendants allegedly ran four marijuana stores in the Los Angeles area known as Hollywood Compassionate Care (HCC) and Happy Days, and nine indoor marijuana grow sites in the San Francisco and Los Angeles areas. These codefendants were indicted for conspiracy to manufacture, to possess with intent to distribute, and to distribute more than 1000 marijuana plants.

In Lovan, the U.S. Drug Enforcement Agency and Fresno County Sheriff’s Office executed a federal search warrant on 60 acres of land located on North Zedicker Road in Sanger, California. Officials allegedly located more than 30,000 marijuana plants on this property. Four codefendants were indicted for manufacturing 1000 or more marijuana plants and for conspiracy to manufacture 1000 or more marijuana plants.

In almost all federal criminal prosecutions, injunctive relief and interlocutory appeals will not be appropriate. Federal courts traditionally have refused, except in rare instances, to enjoin federal criminal prosecutions.

Here, however, the Court said that Congress has enacted an appropriations rider that specifically restricts DOJ from spending money to pursue certain activities. It is "emphatically . . . the exclusive province of the Congress not only to formulate legislative policies and mandate programs and projects, but also to establish their relative priority for the Nation. Once Congress, exercising its delegated powers, has decided the order of priorities in a given area, it is for . . . the courts to enforce them when enforcement is sought." A "court sitting in equity cannot ‘ignore the judgment of Congress, deliberately expressed in legislation.’"

The Appropriations Clause plays a critical role in the Constitution’s separation of powers among the three branches of government and the checks and balances between them. "Any exercise of a power granted by the Constitution to one of the other branches of Government is limited by a valid reservation of congressional control over funds in the Treasury." The Clause has a "fundamental and comprehensive purpose . . . to assure that public funds will be spent according to the letter of the difficult judgments reached by Congress as to the common good and not according to the individual favor of Government agents."

The ten cases were therefore remanded back to the district courts. "If DOJ wishes to continue these prosecutions, Appellants are entitled to evidentiary hearings to determine whether their conduct was completely authorized by state law, by which we mean that they strictly complied with all relevant conditions imposed by state law on the use, distribution, possession, and cultivation of medical marijuana. We leave to the district courts to determine, in the first instance and in each case, the precise remedy that would be appropriate."

Despite the outcome, however, Judge Diarmuid O'Scannlain wrote that medical marijuana purveyors should not feel immune from federal law. "Congress could restore funding tomorrow, a year from now, or four years from now," he wrote, "and the government could then prosecute individuals who committed offenses while the government lacked funding." Read More...

DCA Says WCAB Has Jurisdiction Over CHP 4800.5 Benefits
Tue, 16 Aug 2016 09:36:50 - Pacific Time
In 2004, Andrew Hernandez, a CHP sergeant in Valencia, slipped and fell while assisting in the pursuit of a suspect who had fled on foot, injuring his low back and cervical spine. Hernandez and the CHP through its adjuster State Compensation Insurance Fund agreed that his injuries were AOE-COE and that he was 35 percent disabled and would need future medical treatment for his low back.

The principal issue in the proceeding before the WCJ concerned payments for temporary total disability. In a February 2013 decision the WCJ found that Hernandez was temporarily totally disabled from July 18, 2011 to November 8, 2011. Although Hernandez received payments equal to the full amount of his salary during that period, a portion of those sums was charged against his accrued annual vacation leave.

Hernandez petitioned in January 2015 for recovery of the full amount he should have received as paid leave-of-absence benefits under section 4800.5, plus penalties for unreasonable delay under section 5814, subdivision (a), and interest.

The WCJ agreed Hernandez was entitled to the relief he had requested; but the Workers’ Compensation Appeals Board in a divided decision after reconsideration, rescinded her ruling, concluding (1) Hernandez’s claim for reimbursement of accrued leave involved employee benefits and was outside the jurisdiction of the Board; (2) the February 1, 2013 award by the WCJ barred Hernandez’s 2015 claim for additional section 4800.5 payments under the doctrine of res judicata; and (3) there was no basis for awarding a penalty because Hernandez had received the full amount of his salary during the period of his temporary disability.

The Court of Appeal in the published opinion of Hernandez v. WCAB disagreed, and annuled the decision of the Board and remand the matter with directions to award Hernandez additional compensation under section 4800.5 in an amount equal to the value of annual leave used during the disputed period of temporary disability and to hear and determine the issue of penalties and interest.

The Board has exclusive jurisdiction over all proceedings for "the recovery of compensation, or concerning any right or liability arising out of or incidental thereto" (§ 5300, subd. (a)), as well as for "the enforcement against the employer or an insurer of any liability for compensation imposed upon the employer by this division in favor of the injured employee, his or her dependents, or any third person." (§ 5300, subd. (b); see also § 5301 [Board "is vested with full power, authority and jurisdiction to try and determine finally all the matters specified in Section 5300 subject only to the review by the courts as specified in this division:].)

Section 4800.5, subdivision (d), specifically confers Board jurisdiction to award and enforce payment of the benefits provided CHP officers by that provision of the workers’ compensation laws.

On the issue of jurisdiction over the 4800.5 issue the court went on the say that "In light of this clear violation of Hernandez’s rights under the workers’ compensation laws, the argument the Board lacks jurisdiction to provide a remedy borders on sophistry."

On the issue of the source of benefits the court concluded that "There can be no dispute that section 4800.5 obligated the CHP to pay Hernandez his full salary, in lieu of disability payments, while he was temporarily disabled..."
Read More...

Aetna Announces Exit Plans for 70% of ObamaCare Market
Tue, 16 Aug 2016 09:36:44 - Pacific Time
Aetna announced that it will walk away from more than two-thirds of the ObamaCare exchange markets it participated in this year, dropping from 778 counties to 242 counties next year. Aetna will maintain a presence in just four states, it says - Delaware, Iowa, Nebraska and Virginia - down from 15 states this year. Aetna covered about 838,000 people through the Obamacare exchange in its 15 states as of June 30.

Aetna, the third largest insurance company in the U.S. says the market's financials are unworkable, pointing out that it has lost more than $430 million since January 2014 on its individual products. It's not the only major player to walk away from the Obamacare exchanges.

"More than 40 payers of various sizes have similarly chosen to stop selling plans in one or more rating areas in the individual public exchanges over the 2015 and 2016 plan years," CEO Mark Bertolini said in a statement. "As a strong supporter of public exchanges as a means to meet the needs of the uninsured, we regret having to make this decision."

Aetna's announcement comes on the heels of an announcement by Anthem that, in a reversal of expectations, it is now projecting mid-single digit losses on the individual plans it sells on the exchanges. Humana said it would dial back its participation on the exchanges from 15 states to 11 earlier this month. UnitedHealth Group plans to remain on "three or fewer exchange markets," its chief executive, Stephen Hemsley, said on an earnings call in July. Cigna has said that it is losing money on the exchanges, but the insurer is planning to expand its marketplace presence to three new states in 2017.

Like other insurers, the company blamed its withdrawal on a pool of exchange participants that has turned out to be heavier users of their insurance plans than previously predicted. Insurers need healthy plan members to off set sick patients to balance the books.

The move also comes amid a fight between Aetna and the U.S. Justice Department over the government's lawsuit attempting to block the company's acquisition of insurer Humana. The government has said the deal violates anti-trust laws, but Aetna has said it will lower costs and improve choice.

One major issue is the risk pool - the balance of healthy and sick people who incur major medical costs. An analysis by the Centers for Medicare and Medicaid Services released last week showed that the per-month medical costs of members on the exchanges each month had barely budged between 2014 and 2015, suggesting that the risk pool was not getting worse.

Next year will be Obamacare’s fourth of providing coverage in the new markets. Aetna’s decision doesn’t affect people covered by the company this year, but when they look for coverage next year, they’ll need to pick a new insurer. The decision, which affects about 80 percent of Aetna’s customers in individual ACA exchange plans, raises the prospect that some consumers will only have one insurer to choose from when they buy 2017 coverage.

ObamaCare relies on privately run insurers to offer health plans that individuals can buy, often with government subsidies. About 11.1 million people were signed up for Obamacare plans at the end of March.  The workers' compensation claims industry had believed that the availability of low cost insurance to those who were previously uninsured would reduce the filing of marginal industrial claims. Read More...

Past Week News Archive


DWC Publishes Updated MTUS With Opioid Guidelines: Mon, 15 Aug 2016 12:26:00 - Pacific Time: Read More...


Yates Memo Leads to Corporate Healthcare Executive Convictions: Mon, 15 Aug 2016 12:25:54 - Pacific Time: Read More...


Employer's Failure to Provide DWC-1 Prevents Carriers' Laches Defense: Fri, 12 Aug 2016 09:40:35 - Pacific Time: Read More...


WCIRB Files Fourth Consecutive Premium Rate Decrease: Fri, 12 Aug 2016 09:40:28 - Pacific Time: Read More...


Excess Carrier May Sue Primary Carrier for Failure to Settle Within Policy Limit: Thu, 11 Aug 2016 10:25:18 - Pacific Time: Read More...


Researchers Partially Reverse Paralysis: Thu, 11 Aug 2016 10:25:12 - Pacific Time: Read More...


Three Popular Orthopedic Surgeries are Actually "Useless": Wed, 10 Aug 2016 08:40:53 - Pacific Time: Read More...


CastlePoint Conservation and Liquidation Plan Hearing Set for September: Wed, 10 Aug 2016 08:40:47 - Pacific Time: Read More...


Global Pressure Urges Drug Pricing Based on Outcomes: Tue, 9 Aug 2016 07:24:32 - Pacific Time: Read More...


Wearable Technology May Be Employee Health "Game Changer": Tue, 9 Aug 2016 07:24:26 - Pacific Time: Read More...