Friday, February 28, 2014

I Called

We're saying goodbye to Dad today.

So I'm not much for writing about workers' compensation as a consequence; our little industry seems just too inconsequential in comparison.

Instead I'm sharing with you a little verse that I wrote for Dad's memorial. I guess it could be used as a little prayer, but I didn't intend it that way.

It is simply my Dad's life summarized in a few short sentences that came to me on my morning bike ride a few days ago (weird how that happens...).

I didn't have a title for it but I guess the title of this blog post is good enough.

And I don't care if someone else uses it or claims it as their own.

This is my dad:

Husband, Father, Friend, Leader

I called upon my husband
And he gave me security

I called upon my father
And he gave me comfort

I called upon my friend
And he gave me understanding

I called upon my leader
And he gave me guidance


I called upon Him in Heaven
And He gave me love

Thursday, February 27, 2014

Annmarie's Dad

I don't know Annmarie Geddes Baribeau any more than I might know any of you - I feel there is a relationship because of the intimate nature that social networking has evolved in our world, but I have never met her, never spoken with her, and until recently never written her.

She posted a very powerful piece about her dad yesterday, "Workers' Compensation: My Father's Story."

The title attracted me because of my father's recent illness and death and how I saw that as illustrative of workers' compensation, albeit on a more abstract level.

Annmarie has a much more direct story - the story of a proud, hard working man full of life, vitality, energy only to be done in by "the system."

Ugh - the pain I felt reading this piece was nearly too much to bear, hence this cathartic exploration of Annmarie's themes.

I thought of the Associated Press reporter who recently contacted me trying to quantify the cost of workers' compensation to her editors in a way that would make the everyday man or woman think about it, when Annmarie said that her father ultimately ended up on Social Security because the system failed him.

How much of the workers' compensation population ends up on the Social Security disability system because of this industry's failures?

I thought of MY dad who didn't have to go through the insult of workers' compensation, but did have to endure a slow degradation towards death.

How many injured workers get on a slow degradation path towards the death of self-esteem and worth because they don't get back to the job?

I thought of all of the misguided attempts to "fix" the system through the years, when really all that needed to be done was to just provide treatment that allowed a man (or woman) to return to earning a living.

I thought of claimant attorneys who in their zeal to represent the interests of their client fail to see what the real interest is - to return a person back to being "a man" rather than securing every possible medical procedure desired or as much compensation as can fit in a bank account.

I thought of the doctors who are not trained in occupational health failing to understand that the psyche is a more powerful indicator of successful outcomes than any physical treatment they could offer and that work is the essence of identity.

I thought of the claims adjuster who would like to provide all the benefits the law affords without question or second-guessing from outside cost control services or buckling under the weight of unmanageable case loads.

I thought of all of the workers in America who don't understand that workers' compensation is not a dispute resolution system, and is not a free handout, and is not a way to get time off with pay.

I thought of all the employers who see that workers' compensation premium come in the mail and pay it only because if they don't they might go to jail even though all of the claimants are fraud.

Mostly though I thought of the reality of workers' compensation; that, as Annmarie states, has improved in so many different ways since the late 1980s, but still has a long way to go.

It's not that workers' compensation is fundamentally flawed. It's that we have fundamentally flawed expectations from it.

When we go back to day one and simplify the equation to the basics of providing injured workers with treatment and compensation in exchange for the employer's civil suit immunity, the system makes sense.

The noise that came along with attempts to make that equation more succinct or relevant to a particular industry or individual has drowned out the main mission.

Obviously there are those who don't respect the law, don't do their jobs, don't like accountability or punctuality.

Those people are the minority, but cause a lot of problems for the rest of us.

I go back and forth, obviously, about the relevance of workers' compensation in today's world. Sometimes I whine about systemic problems. Sometimes I praise what I believe to be a good value to society when all goes well.

Mostly though I believe that we don't need to "fix" workers' compensation. We just need to make what we have work properly by all of us doing our jobs to the best of our abilities; respecting the law, being accountable and punctual.

Wednesday, February 26, 2014

A Grand Opporunity

There's good news coming out of the Drobot/Pacific Hospital/Calderon drama - the possibility that the doctors who were on the dole will also face prosecution.

Michael D. Drobot's plea agreement requires him to cooperate fully with federal, state and local prosecutors by testifying at trials and grand jury proceedings and providing documents, records and other evidence requested by the U.S. Attorney's Office.

Albert H. MacKenzie, a former deputy district attorney in charge of the Los Angeles County District Attorney's fraud interdiction program, told WorkCompCentral that having Drobot as a cooperating witness gives prosecutors the greatest opportunity he's ever seen to clean up medical fraud in the workers' compensation system.

“My hope is that it is utilized to the fullest extent, that it just doesn't end up with the Calderons being prosecuted, but we also reach out and look at who were all these people who were vultures preying on the bodies of injured people,” he said. “It's incredible and I hope it isn't lost.”

While the federal government may focus on the Calderons, MacKenzie said there will still be “plenty of meat on the bone” for the state's top attorney and county prosecutors to identify and prosecute the doctors who took payoffs from Drobot.

MacKenzie cited Labor Code section 3215 which provides:

"Except as otherwise permitted by law, any person acting individually or through his or her employees or agents, who offers, delivers, receives, or accepts any rebate, refund, commission, preference, patronage, dividend, discount or other consideration, whether in the form of money or otherwise, as compensation or inducement for referring clients or patients to perform or obtain services or benefits pursuant to this division, is guilty of a crime."

Violation of this section can result in jail for up to a year and a fine of $10,000 on a first offense. A second or subsequent conviction is punishable by incarceration in state prison.

MacKenzie is right - once the linchpin is secured it's time to go after the people who have fed off the destruction of innocent workers' lives.

Last month I was critical of the California Fraud Commission and the money they hand out - money that is collected from employers as an assessment on policy premiums.

At the California Fraud Assessment Commission meeting last month Jiles Smith told attendees that they're going to have to think outside the box.

“Every time a prosecutor comes in asking for more and more and more funds, knowing that there’s no more funds available, it’s going to push us into that situation every year where we are trying to do our best, reading thousands of pages to determine whether or not the District Attorney’s Office does, in fact, grasp what it is they’re supposed to be doing with these funds to impact the workers’ compensation fraud problem in the state and those cost drivers that continue to make workers’ compensation (in) California one of, if not the most expensive in the country,” he said.

I said last month that district attorney offices that want more fraud money not only have to open more investigations and close more prosecutions, but need to market those efforts more effectively.

I stand by that statement.

Here is a situation where the the State Attorney General and the various district attorneys within the county of Los Angeles have been given an extraordinary gift - this is akin to the capture of Joaquin “El Chapo” Guzman.

If the attorney general offices that seek fraud commission funding want to prove themselves that they are worthy of the money they will take advantage of this unique opportunity.

And as more individuals are identified I hope that the victims of these criminals seek civil compensation for ruined lives.

Certainly the State Compensation Insurance Fund in its RICO action against Drobot's son, Michael R. Drobot, alleged to have established a similar scheme, will benefit from this testimony.

The younger Drobot's attorneys have filed a motion in that suit asking the U.S. District Court for Central California to issue a six-month stay on the proceedings because a federal criminal investigation of their client is underway.

But all of the surgical victims have damages too and while the restrictions in California for medical malpractice make it nearly impossible for these unfortunate folks to get any meaningful recovery, riding the coattails of the State Fund's suit with independent actions against the complicit doctors for fraud and conspiracy should be actionable.

This case represents the single biggest opportunity to clean up workers' compensation in California and the single biggest opportunity for these attorney generals to redeem themselves in the public eye.

I despise sensationalism, but this is one situation where I hope to see more headlines about miscreants taking a fall for the despicable ruination of lives and the compromise of the workers' compensation system.

Tuesday, February 25, 2014

Help Me Keep Faith

On Friday the news broke about Michael Drobot's confessions and the indictment of Sen. Ron Calderon and his brother, former Assemblyman Tom Calderon.

Yesterday more in depth news about the scandal was published and today even more details surface.

And of course Sen. Calderon denies all of the allegations of wrong doing through his defense attorney, Mark Geragos.

Mr. Geragos is himself famous for defending the rich and famous, and was even involved in the Whitewater controversy.

And Calderon implicates Senate President Pro Tem Darrell Steinberg. Sen. Kevin de Leon, D-Los Angeles, is named in the leaked FBI affidavit as well, though allegedly is not part of the investigation.

DeLeon introduced Senate Bill 896 that proposed to repeal the pass-through but at the same time increase the fee schedule payment for performing fusions from 120% to 180% of what Medicare pays. In April, he amended his bill to increase the payment to 200% of Medicare and add language to preserve the pass-through.

De Leon pulled SB 896 from consideration before a hearing that was scheduled for May of that year. The leaked FBI affidavit alleges that Calderon persuaded de Leon to introduce SB 896 and later amend the measure on behalf of Drobot, and that de Leon pulled his bill because he had not received any money in exchange for his help.

So DeLeon switched allegiance and in 2012, he teamed up with Assemblyman Jose Solorio, D-Santa Ana, to introduce SB 863.

Back in November of last year, after Al Jazeera published the leaked affidavit used to obtain a warrant to search the senator’s Capitol offices, Calderon said that Steinberg essentially was retaliating.

In a motion seeking an order to show cause for why the federal government and its agents, including Asst. U.S. Attorney Doug Miller of Los Angeles, should not be held in contempt for leaking the affidavit, Calderon said then, “Sen. Steinberg, who was the target of the government’s investigation for his conduct, has stripped Sen. Calderon from his committee positions and, on Nov. 12, 2013, proclaimed he ‘will be damned’ if Sen. Calderon harms the reputation of the California state Senate.”

Calderon had gone on to say that the FBI or Miller engaged in a large scale campaign to smear his reputation “and convict him in the press and public before a grand jury was assembled and while it was still hearing evidence,” and that “[t]here is a systematic and systemic pattern of contempt for secrecy rules in AUSA Miller’s cases resulting in the complete corruption of the legal process and character assassination of his targets.”


Even yesterday after pleading not guilty, Garegos told reporters that Calderon will be making a decision about whether to resign from the Senate once he advises Calderon "how much of his time I'm going to need" in order to defend the case.

"All things being equal," Geragos said, "of course" Calderon would like to continue serving in politics. "It's what he loves to do," Geragos said.

Calderon and his cronies don't get it.

Our own government doesn't get it.

Evidence of the Drobot scheme had been presented to law enforcement and Division officials long ago, but no one seemed to care much. Who's driving the bus?

The seven procedures for which California's spinal-surgery implant pass-through was preserved last year due to the Drobot/Calderon connection cost insurers and employers an average of nearly 75% more than the seven procedures for which the pass-through was eliminated.

Senate Bill 863, passed in 2012, preserved extra charges ranging from $630 to $9,140 for implants used in procedures identified by Diagnostic Related Groups 453, 454, 455, 456, 028, 029 and 030.

The story by Greg Jones of WorkCompCentral this morning details the huge amount of money at stake - a difference of tens of millions of dollars per year compared to the new codes.

I was at one of the alphabet soup California conferences last year (forget which one) where the presenter was slightly baffled why medical costs were so much higher in Southern California, and concentrated in the Los Angeles area.

I don't think there's any real mystery...

Geragos told reporters yesterday, "everyone take a deep breath" before "jumping on the bandwagon and pillorying (his client)" because "there is still a presumption of innocence in this country."

True enough - innocent injured workers having their lives ruined by these treacherous villains.

And while the defendants say that the pass-through language in SB 863 was the result of a compromise between the California Hospital Association and Sen. Ted Lieu, D-Torrance, Amber Ott, vice president of finance for the California Hospital Association, said that isn't what happened. The seven procedures identified in SB 863 as being eligible for separate hardware reimbursement in 2013 were picked “in a vacuum,” Ott told Jones.

She said the California Hospital Association “argued those were not the best to choose” because they don't represent either the highest volume of procedures performed or the most expensive outlier cases.

Smear, power, politics, money - it all circles around a financial system that has lost its way - the footprint of workers' compensation on the rest of the world is so small that it just invites the nefarious to pillage because no one really cares.

Society doesn't understand workers' compensation, doesn't know anything about workers' compensation and doesn't care about it unless they are one of the 1% that get sucked into the system.

I got a message from one high level claims CEO that he lost one of his best adjusters to the scheme - succumbing to the sweet talk of a surgeon on the kick back scheme only to get a death sentence from the pain medication she became addicted to. So even those inside the system have fallen prey.

How many more of these stories will unfold?

I was talking to an Associated Press reporter yesterday. She was trying to quantify workers' compensation in a way that would matter to the average Joe on the street - she was trying to paint a picture to show how workers' compensation makes a difference to the average tax payer.

And honestly, beyond standing on high moral argument about our social structure and maintenance of a viable work force, I couldn't think of any way to do so.

Workers' compensation is a lot of money, but not compared to overall health care. Not compared to other lines of insurance. Not compared to the overall tax base. Not compared to most big industries.

Workers' compensation is looked upon mostly as a nuisance by the business world, and as a source of fraud and cheating by the working population.

And maybe it is. Maybe this story is just what workers' compensation has come down to.

It is sad. The social compass is broken. Workers' compensation seems to be more about financing the vendors rather than providing medical treatment and indemnity to workers.

I am not optimistic that this story will turn out any different than any of the other big fraud cases we have seen in workers' compensation - that is not much will come of it. We're content with prosecuting small fry cases because they're easy, and represent what the public understands about workers' compensation.

For that AP reporter trying to quantify workers' compensation to the rest of the world - take away the system and let's see what the cost is over the course of the next five or ten years while everyone fights in the civil courts about fault, and the last resort medical system, which translates to tax dollars, drowns under unpaid procedures.

Honestly, maybe we should just disband workers' compensation.

Monday, February 24, 2014

Throw The Book At 'Em

It's a shame that hundreds, if not thousands, of injured workers underwent unnecessary spinal fusion surgeries and must live with the debilitating aftermath of significant disability because of people whose greed overrides the well being of fellow humans.

I had learned about Michael Drobot and Pacific Hospital of Long Beach, and their co-conspirators, preying on workers' compensation patients some time ago.

On Friday though, Federal prosecutors announced that Michael D. Drobot faces up to 10 years in prison after he pleaded guilty to paying kickbacks in a $500 million fraud scheme relating to spinal fusions and admitted to bribing state Sen. Ron Calderon to delay legislation to repeal the separate reimbursement for spinal hardware.

Calderon, D-Montebello, was indicted one day earlier on 24 charges, including bribery, money laundering, wire fraud and filing a false tax return. His brother, former Assemblyman Tom Calderon, was also indicted on Thursday for charges of money laundering and conspiracy to commit money laundering.

Drobot has agreed to surrender and be arraigned in the U.S. District Court in Santa Ana on March 31. Ron Calderon, who faces up to 400 years in prison, will surrender to authorities today, Monday. His brother, Tom, who faces up to 160 years in prison, was arraigned Friday afternoon.

According to authorities, 90% of the fraudulent bills submitted by Drobot were for workers' compensation claims.

The criminal complaint alleges that between 2008 and 2013, Drobot billed California workers' compensation carriers about $500 million for spinal surgeries performed at Pacific Hospital that were the result of an estimated $20 million to $50 million in kickbacks to "dozens of doctors, chiropractors, marketers and others for their referring workers' compensation patients to Pacific Hospital for spinal surgeries, other types of surgeries, magnetic resonance imaging, toxicology, durable medical equipment and other services."

Drobot paid a kickback of $15,000 for each lumbar fusion procedure that was referred to his hospital and $10,000 for each cervical fusion procedure, the complaint alleges. To conceal the illegal kickbacks, Drobot entered into “bogus contracts” with doctors and others that purported to be collections, research and development, lease and rental, consulting, marketing, management and other types of agreements.

In order to prevent and delay efforts of lawmakers and the Division of Workers' Compensation to change the pass-through provisions, Drobot bribed Calderon by hiring the senator's son to work for him during the summer. Calderon's son was paid $10,000 each summer from 2010 to 2012 “for approximately 15 days of work” he performed for Drobot, the complaint alleges.

Drobot also plied Calderon other benefits, including trips on privately-chartered airplanes, golf and high-end resorts and meals at expensive restaurants.

More details of this despicable scheme are in the WorkCompCentral story this morning.

Much is written about "what is wrong" with workers' compensation and this story highlights EXACTLY what is wrong: politics and the undue influence of rapacious business interests that seek to profit from the unsuspecting injured in an abominably corrupt fashion.

I hope this case goes further. I hope this case goes deeply into all of the business interests that were a part of the Drobot scheme - the "doctors, chiropractors, marketers and others" who got the kickbacks. Each and every one of the should be held accountable for their lapses in judgement, morality, ethics and, yes, destruction of the lives of thousands.

I can virtually guarantee that this case is just an example of one of probably hundreds of schemes whereby politicians are corrupted to protect unscrupulous business interests in workers' compensation around the country: physician dispensing, hardware pass-through, receivables financing - the list of potentially abusive and unethical (if not illegal) politically connected abuses is only limited to the imagination of the criminally inclined and greedy politician.

I'm glad that finally something was done in this case. Unfortunately it's too late for the victims that have been thrown to the curb-side by these contemptible people; their lives will never be made whole regardless of the level of benefits provided by the workers' compensation system.

Friday, February 21, 2014


At the Artex Risk Management Conference in Orlando this week I had the opportunity to talk to many folks about workers' compensation on a national scale.

The attendees are all part of some captive insurance program, and most of them have national, if not international, operations. Workers' compensation to them is a very close and personal professional life - every single one of the risk managers I talked to didn't have any bad things to say about work comp (even California work comp), they just want to know how to get benefits to their employees as efficiently as possible within the bounds of the law, balancing of course the company's financial position.

Because they are in captive programs they are able to exert more influence over a claim than most insured employers can. They understand that successful workers' compensation outcomes require ACTIVE participation and they have policies and procedures to engage the supervising line and the working folks at the very earliest stages of a claim.

Active engagement early might entail something as simple as little wallet cards for the business that supervisors and employees all carry outlining the steps in case a work place incident occurs, and is as personal as visiting with the injured employee within the first day of a claim to check on him/her, answer questions, take care of the employee.

These companies have the resources to initiate and operate active claims management programs and achieve great success doing so.

Contrast that to the following tale I received from a consultant to small businesses with workers' compensation issues - these companies don't have the resources to prevent simple claims from going south. Here's his tale of a litigated case that got out of control and spun into tragedy:


We have a 41 year old machinist that has been with the employer since 2000 – 13 years. I assume he is a good employee- the employer says he was. He has two children – 12 and 15 years of age.

While pulling/pushing a pallet jack, he experienced pain in his right calf in March 2011. Within one month, after an MRI, he is subjected to lumbar surgery – even though he is on record as saying he had no lower back pain. The surgery did not help the pain to his lower leg.

In Feb 2013, he was again subjected to lumbar surgery by another doctor, even though he again says he has no back pain and the surgery didn’t help the pain in the legs. He now reports depression which, according to the psychologist that examined him, is due to the effects of the injury (Ed note: understandably).

Today, we have an AME report that states he is P&S with a 20% WPI. He will get approximately $20,000 and some settlement for future medical. The various colors of the pills he is taking would be sufficient to light up a Christmas tree.

Because of his work restrictions and his own statements (can’t drive, shop, or do housework for more than 30 minutes) there will be NO offer for return to work. He admits he couldn’t return to work with the physical requirements of the job.

Basically, this truly injured worker will be thrown on the trash heap of life. At least two doctors made a pretty penny for performing surgery for something that even the injured worker said didn’t hurt. He was hurt in March 2011. It’s now February 2014 – three years later.

Where’s the justice? We have a young man that will likely not be able to earn a living to support his family. We have an employer that will lose a good employee and, to protect themselves, will not be in a position to help.

And we have a large slice of the internet filled with the ghouls of the system, feeding on the broken bodies of the workers, whining about not getting fatter off the system. Shame on me, shame on you, shame on everyone for acting like the entire system was designed to deliver benefits to them instead of taking care of the injured workers and the employers that pay their salaries.


Now, I haven't read the medical reports on this claim and I'm taking the tale at face value. Certainly one could question the motives of the physicians doing lumbar surgery when the complaint is leg pain, but perhaps they felt there was some nerve impingement.

I don't know.

It's easy to vilify one player or another in the work comp game and yes there are some unscrupulous players that will stop at nothing to take advantage of the no fault characteristics of the system.

But also look at the system itself - what are the constrictions on the healers? Perhaps given the alternatives (i.e. non-invasive techniques for which the system DOES NOT pay for) there aren't may choices.

We went over this at the Artex conference; that there are many, many treatment choices that aren't considered because the system won't pay for them, or won't pay for them adequately. For instance, the artificial cap on physical therapy many jurisdictions have implemented. Those caps were instituted because a couple of folks abused the privilege.

We don't have to follow these artificial caps. Alternative treatment can be approved even if not within a fee schedule.

We deal with claims in a bulk fashion and with broad brush strokes. But every claim is different. The personalities are different. Tolerances are different. Co-morbidities are different.

Employers big enough to be part of a captive program have the resources to do things differently and many of them do.

The choices for small employers are much more limited.

It's a shame for the employee example above - for both the worker and the employer.

I don't have a fix either other than to note that we, as an industry, need to do our best to look beyond what the law requires and do the right thing. We can't always "win." There will be cases that just get lost for reasons well beyond our control.

Most of the time, however, we have the ability to make sure that the right thing is accomplished. Go out there and do the right thing....


P.S. - Many thanks to everyone for the condolences on my father's death. His journey opened my eyes to life, disability and, yes, death. I'm grateful for all of the time with my parents and I'm grateful for all of the friends I have in this industry who, well more than folks in any other industry, understand what goes on when taking care of a person unable to take care of themselves. Blessings to all. Thank you.

Thursday, February 20, 2014

Dad's Gone; George Smith Isn't

Dad died.

I was in transit to Orlando, FL at 37,000 feet on a Southwest Airline 737 with a satellite Internet WiFi connection when I got the email from my wife.

It was sad in some respects, of course. The death of a parent, child, friend - anyone close - is never an easy thing to accept.

It was a relief in some respects too. As you know, Dad had been bedridden since before Thanksgiving, 2013. Being in that state of decline for so long was a difficult thing to observe, particularly of someone who was so vibrant, energetic and, sorry for the pun, full of life.

There was a tinge of anxiety - did I have everything set up for this ultimate moment?

Checklist: forms and contract with crematorium for body pick up and disposition; pending arrangements for a service; notification to key individuals...

And what about Mom? In a different facility for rehabilitation and dementia care - they said it would not be a problem to take her for the service when the time arrives, but what do I need to do to make that happen?

Dad sporting his WCC shirt
This isn't at all different than the closure of a workers' compensation case - the file might go to the cabinet, but there's still plenty of unfinished business.

I'm not talking about the final bills and notices, but about the aftermath to the survivors, particularly the family.

We forget that in workers' compensation claims work. We provide the benefits, pay the bills, make the indemnity payments, and when the law or regulations say stop, then we stop. The legal obligation gets fulfilled.

That objective ability to disengage the emotion from the work we do isn't easy, and sometimes we can't disengage.

But the effect is felt by many others after that file is closed, especially for the catastrophic or large loss claims.

For instance, there's the Ohio case recently where a worker ends up brain damaged due to complications from a hernia surgery back in 1995.

A hernia surgery?! Such a common medical procedure - so common we forget that it IS surgery, invasive, subject to risk and complications - but never would I have imagined that someone would have severe brain damage from hernia repair.

I can't imagine that the family of George Smith was prepared for him to come out of hernia repair surgery with permanent total disability.

I can't imagine that the claims administrator was prepared for such an outcome either.

But beyond the Ohio Supreme Court's rulings on the case about additional scheduled benefits there's the human component, the fact that Smith has no practical use of his limbs, doesn't seem to process visual information or respond to auditory stimulation.

And apparently has been in that state now for nearly 20 years.

Dad's passing was a blessing in that his time in bed, disabled, was short in comparison.

I'm thankful my lifestyle allowed me so many close, wonderful moments with him during these past 4 months.

In the beginning there was doubt and question about his state. When Dad was released from the hospital last November the attending physician was clear with me that he was dying - what I didn't appreciate was that it would take so long.

While that time was anxious and there were doubts about the impending end of life because of the ups and downs that were experienced, the trend was obvious.

Perhaps it was most obvious to the one for whom the experience was most personal - Dad himself.

He would ask me if he was dying. I was supportive, but I'm not one to sugar coat things (ask my wife or staff about that!), and would tell him that, yes, he was dying. He would look at me with resignation - not mad, not sad, not even in disbelief.

Just factual. He knew deep inside that the end was coming but just wanted confirmation.

I think he was coming to grasp with mortality, with the fact that at some point he would check out. I think he was going through the checklist in his head: did he live as big as he could (Tahitian vacations every December), did he provide for his family to the best of his ability (four children all with post-graduate degrees), did he love his wive more than anything in the world (never could he have imagined leaving her in the uncaring hands of another), and did he give as much back to the world as it gave him (his unending volunteerism providing free dental care to orphaned Mexican children)?

If it wasn't to him, it was to me - clearly the answer was that Dad exceeded all expectations of living.

I didn't quite grasp why he was so interested in the chart or grid that set forth the stages of dying and the symptoms and reasons for them. But now I understand that he knew the time was near.

At least Dad was mentally sharp, aware, and understanding for most of that time, able to smile and sing happy songs about a new day, about sunshine, about happiness and hope.

It's likely that George Smith doesn't have that luxury, isn't able to grasp his predicament, or appreciate the care and love that his family has provided the past 20 years.

George probably can't sing Dad's song...

Like a workers' compensation case, there is still plenty left to take care of with the closing of this chapter. Mom, services, bills, family - we're not done until ... well ... until WE'RE done.

Then it's for the next person to take over.

Andrew J. DePaolo, Sr.: 10/04/1922 - 2/19/2014. I love you Dad.

Wednesday, February 19, 2014

Equity Has No Place In Presumptions

I've blogged before that presumptions in workers' compensation tend to prolong litigation and make for bad precedence, and a recent California case highlights that concern.

The First District Court of Appeals in California will decide whether a municipal employer had successfully rebutted the presumption of industrial causation for a novice police officer's colon cancer in light of evidence that the disease takes decades to develop.

In City of Paso Robles v. WCAB (Bigelow), No. A140531, the workers' compensation judge found that Daniel H. Bigelow's workplace exposure to known carcinogens was not reasonably linked to his cancer, since the panel Qualified Medical Evaluator said the latency period for colon cancer is longer than the four years that Bigelow had been on the City of Paso Robles police force.

Bigelow joined the police academy in Nov. 2005, and he was diagnosed with cancer just over six years later, in 2011.

The QME opined that it was likely that Bigelow had been exposed to benzine, a known carcinogen, during his time as a police officer. However the QME said there is no causal link between exposure to benzine, or any other known carcinogen, and the development of colon cancer. 

The doctor further testified that cancers in general have a latency period of between 15 to 20 years, and since Bigelow's employment with the City of Paso Robles did not fall within the latency period, Levine said he felt it was medically improbable that there was a relationship between this employment and Bigelow's cancer.

Since Bigelow had relied solely upon the presumption to establish causation, the WCJ ruled that he had not established his entitlement to benefits and ordered that he take nothing on his claim.

The Workers' Compensation Appeals Board disagreed and a unanimous panel rescinded the judge's findings on causation last November.

"[T]he mere absence of a study showing a link between exposure to carcinogens and the development of a certain type of cancer does not rebut the Section 3212.1 presumption of industrial causation," the WCAB panel opinion said.

The WCAB said that the Section 3212.1 presumption "may be rebutted by substantial medical evidence that proves that the latency period for the specific cancer at issue excludes industrial exposure to carcinogens as its cause," but since the QME admitted there are no studies showing a specific latency period for colon cancer, his testimony about the average latency periods for other types of cancer could not rebut the presumption of causation. 

The City appealed.

Labor Code Section 3212.1 provides fire and police personnel who develop cancer during the course of their career a presumption of compensability if they can show they were exposed to a known carcinogen while working.

An employer can rebut the presumption with evidence that the primary cause of the cancer was not the workplace and that the carcinogen to which the officer or firefighter has demonstrated exposure was not reasonably linked to the cancer.

In other words the employer needs to prove a negative - that an exposure in the work place doesn't result in cancer.

It is nearly impossible to prove that there is no cancerous exposure in the work place because nearly everything in life produces some cancerous exposure - just breathing the air in an automobile is a cancerous exposure, particularly if you drive frequently in congested traffic, or purchase a new car with that nice, plastic "new car" smell in ignorant bliss of the fact that smell is produced by the huge amount of hydro-carbon emissions from all of the interior plastics...

And, in many cases, the claimant's previous employers will fight among themselves about when the cancer developed as they seek to spread the cost of (or avoid entirely) liability for the claim.

The argument in favor of presumptions is that they reduce litigation by providing a directive regardless of the defenses.

But as we have seen time and time again, presumptions tend to exacerbate litigation, and all the while there is the injured worker trying to figure out who is going to pay for his cancer treatment, how the bills are going to be paid while he is not working, and dealing with the major life decisions confronting someone's mortality reality.

The only way to make a presumption truly a presumption is to make it conclusive - i.e. not rebuttable.

Employers won't buy that however because even though workers' compensation is a "no fault" system, responsibility is inherently a fault finding concept and who or what is responsible will drive nearly any rational person to explore some way of deflecting fault.

And what we end up with is what we would end up with if there was no presumption in the first place: an employee seeking a remedy for his or her malady and an employer seeking exculpation or at least deference of liability and payment.

The 1st DCA in this case may help provide more certainty in cancer presumption cases by drawing the clear line - if there is a 3201.1 claim then either there is conclusive evidence that the cancer was not caused by employment, or there isn't.

If the evidence isn't conclusive then the presumption stays.


That will clear the ambiguity of the cancer presumption. An employer may not feel it isn't fair or equitable - certainly the City of Paso Robles would have that feeling given that the claimant in this case worked there only 6 years.

But workers' compensation isn't about being fair. It's about 1) workers (with an apostrophe denoting the plural possessive) and 2) compensation (encompassing payment for medical care and indemnity).

There is nothing in that equation that talks about fair, just, equal or any other concept of equity.

Tuesday, February 18, 2014

The Sun Is Shining

Many of you have written me the past few weeks to comment on, or commiserate with me regarding, the plight of my parents - which I have used as metaphors for workers' compensation.

The compassion, concern and caring that you have expressed is likewise indicative of the heart and soul of workers' compensation - people genuinely care about other people, which is why workers' compensation for the most part works as well as it does (regardless of the various criticisms I have, or anyone else has).

When visiting my dad the other day, he kept asking, in his faltered and struggling voice, for his "chart."

I didn't know what he was talking about.

Eventually I figured it out - it was a grid that hospice publishes to help patients and families understand the process of dying and where one is in that process.

Early to mid stages of dying

Late stages of dying

From what I can gather with reference to the stages of dying in these charts is that Dad is somewhere in the early "late" stage.

He doesn't have much interest in eating or drinking, he is confused and is hallucinating, sleeps most of the time and when he is awake he's not entirely aware, and has a very tough time talking.

But there can still be some enjoyment - he was able to sing with me a couple lines of "his" song and give me a smile.

Some of his symptoms are because body systems are shutting down, and other symptoms are because of his morphine regimen.

It's A Beautiful Morning
Dad can't walk, can hardly move his arms now, and certainly can't move around in his bed. I can't imagine this state of being, and yet it is graphically right in front of me in all of reality two or three days a week.

THIS is where the use of opiates is appropriate - easing the pain of the terminally ill.

How would Dad be if he didn't have morphine to cloud the stark reality of dying? What kind of pain would he be experiencing (and for which I would have untold guilt) if opiates were not available for this condition?

Thank goodness morphine is available to my father - this is an appropriate use of the drug.

But I can't think of much appropriate use of these class of drugs in workers' compensation cases - not that many are terminal...

The medical and insurance communities continue to research the effect of opiates in workers' compensation. These studies invariably focus on the costs of opiate dispensation, in terms of medical treatment, indemnity, and social costs.

One of the bigger factors in the opiate debate seems to be physician dispensing - when most of the variables are accounted for or controlled, it appears that higher costs and higher rates of prescription and dispensation are associated with physician dispensing.

A recent study to be published in the Journal of Occupation and Environmental Medicine found that in cases where opioids were dispensed by physicians rather the pharmacies, medical costs were 78% higher, indemnity costs were 57% higher and lost-time days were 85% higher.

These are generally run of the mill workers' compensation cases, not cases of the terminally ill like my dad.

The latest study implicates physician dispensing with significantly greater use of opiates and time off work.

The number of prescriptions in the physician-dispensing claims was 2.99 times higher than in claims without dispensing by a physician according to this study.

The average amount of time lost by claimants who didn’t receive medications dispensed by a physician was 64 days compared to 85 when dispensed by the doctor.

When it came to opioids time off was 66 days when dispensed by a pharmacy but 122 days when by a physician.

When I was growing up I had a huge respect for physicians - they were commanding, authoritative, educated, and knowledgable. Dad was a dentist - the same personality qualities applied. Ask anyone who knew my dad, even as a retiree, and they will tell you that these characteristics described him.

Dad was also hugely forthright. I will never forget when I was a very young workers' compensation defense lawyer and cases were coming out of questionable medical/dental shops of Temporal Mandibular Joint Disease. I asked Dad about this condition as I prepared for my first expert deposition on the topic. Dad was blunt: "it's bullshit."

I don't hear much about TMJ any longer. Dad was right.

Dad would probably say the same thing now about physician dispensing and its ties with opioids.

The hospice physician prescribed the morphine. It is dispensed by Dad's residential community for which they charge $350 per month.

What would this cost if this were workers' compensation? And what would be the outcome?

I know most of you out there have heart and soul, and strive to do the right thing. When we get word of the bad things in comp, like the study mentioned in this post, we tend to lose sight of the fact that these represent the outliers. 

There is a time and place for everything - "today's another day."

Dad is still breathing regularly so I know there's still some time. When I visit I remember to touch him softly, hold his hand, kiss him on the forehead and talk to him reassuringly. His mind might be cloudy, he might not hear or see very well, and his sense of taste is completely gone.

But Dad can still smile.

"It's a beautiful morning," he'll sing with me. The sun is shining and everything's okay.

Friday, February 14, 2014

If Benefits Provided, Protections Flow

New York's highest court on Thursday unanimously ruled that workers' compensation exclusivity can shield an employer from tort liability for an employee's workplace injury, even if it has hired undocumented workers.

And that result is completely just in my mind.

Some activists are upset that an employer of undocumented workers could not be sued in tort for injuries because they believe that providing the workers' compensation shield against tort liability creates an incentive for abusing workers who may be too timid or afraid to take corrective action because of their immigration status.

But obviously in this case the immigration status of the workers involved did not inhibit their request for, and receipt of, workers' compensation benefits. So if the remedy is available to the employee, the protections should also flow to the employer...

In New York Hospital Medical Center of Queens v. Microtech Contracting Corp., No. 1, Microtech Contracting was hired to do some demolition work in a basement room that housed an incinerator. A Microtech representative then hired Luis and Gerardo Lema to perform the work.

The Lemas are brothers, natives of Ecuador, were not legally employable in the United States at the time Microtech hired them.

Microtech supplied the Lemas with a sledge hammer and a chipping gun – essentially a small jackhammer – and put them to work. The vibrations from the chipping gun dislodged a metal chimney attached to the wall of the room, about 10 to 20 feet above the floor. The chimney toppled over on to the brothers, injuring them both.

The brothers made claims for, and received, workers' compensation benefits, from Microtech's insurance carrier. The Lemas then sued the hospital in tort. A supreme court judge granted summary judgment for the hospital on the issue of liability under Labor Law Sections 240(1) and 241(6).

The hospital then reached a settlement with the Lemas and subsequently filed suit against Microtech seeking contribution and indemnification.

Microtech moved to dismiss the complaint on the ground that the suit was barred by Workers' Compensation Law Section 11, the exclusive remedy provision of New York comp statutes.

Rejecting the hospital's argument that because the Lemas brothers were in the country illegally, that the contract of employment was illegal and thus not subject to workers' compensation exclusivity, the court said the question really was whether Microtech was entitled to the safe harbor in Section 11.

Concluding the answer was yes, the court acknowledged that the policy of the state was that wrong-doers should not be rewarded for such, but the court reasoned that these principles were not at issue because the court was not being asked to enforce or recognize rights arising from the illegal contract between Microtech and the Lemas.

"If the illegality of the employment contract does not defeat the employee's rights under an otherwise applicable state statute," the court reasoned, there was no reason why it should defeat an employer's rights under an otherwise applicable statute like Section 11.

A number of state courts have found that undocumented workers are entitled to income benefits under workers' compensation. The U.S. 5th Circuit Court of Appeals has also reached the same conclusion for indemnity benefits under the Longshore and Harbor Workers' Compensation Act.

A distinction is that many also say that because the workers can not legally be employed they can not avail themselves of return to work benefits such as vocational training since they can not thereafter legally obtain employment.


There will be no publication on Monday in observance of President's Day. I will resume Tuesday.

Thursday, February 13, 2014

Jurisdiction and Compensable Consequence

I have posted quite a bit in this blog about the futility of specialty legislation - from my observations of 30 years in this industry, specialty legislation never really works as intended and there always seems to be some way around it.

Last year the National Football League and its compatriots in other professional sports leagues pushed for and got the Governor's signature on AB 1309 - that's the bill that limits California jurisdiction over out-of-state player claims with minimal contacts to the state.

The intent was to restrict access to California's liberal workers' compensation laws, so AB 1309 amended Labor Code section 3600.5 with the following:

***********(c) (1) With respect to an occupational disease or cumulative injury, a professional athlete who has been hired outside of this state and his or her employer shall be exempted from the provisions of this division while the professional athlete is temporarily within this state doing work for his or her employer if both of the following are satisfied:

(A) The employer has furnished workers’ compensation insurance coverage or its equivalent under the laws of a state other than California.

(B) The employer’s workers’ compensation insurance or its equivalent covers the professional athlete’s work while in this state.

(2) In any case in which paragraph (1) is satisfied, the benefits under the workers’ compensation insurance or similar laws of the other state, and other remedies under those laws, shall be the exclusive remedy against the employer for any occupational disease or cumulative injury, whether resulting in death or not, received by the employee while working for the employer in this state.

(3) A professional athlete shall be deemed, for purposes of this subdivision, to be temporarily within this state doing work for his or her employer if, during the 365 consecutive days immediately preceding the professional athlete’s last day of work for the employer within the state, the professional athlete performs less than 20 percent of his or her duty days in California during that 365-day period in California.

(d) (1) With respect to an occupational disease or cumulative injury, a professional athlete and his or her employer shall be exempt from this division when all of the professional athlete’s employers in his or her last year of work as a professional athlete are exempt from this division pursuant to subdivision (c) or any other law, unless both of the following conditions are satisfied:

(A) The professional athlete has, over the course of his or her professional athletic career, worked for two or more seasons for a California-based team or teams, or the professional athlete has, over the course of his or her professional athletic career, worked 20 percent or more of his or her duty days either in California or for a California-based team. The percentage of a professional athletic career worked either within California or for a California-based team shall be determined solely by taking the number of duty days the professional athlete worked for a California-based team or teams, plus the number of duty days the professional athlete worked as a professional athlete in California for any team other than a California-based team, and dividing that number by the total number of duty days the professional athlete was employed anywhere as a professional athlete.

(B) The professional athlete has, over the course of his or her professional athletic career, worked for fewer than seven seasons for any team or teams other than a California-based team or teams as defined in this section.

(2) When subparagraphs (A) and (B) of paragraph (1) are both satisfied, liability for the professional athlete’s occupational disease or cumulative injury shall be determined in accordance with Section 5500.5.

(e) An employer of professional athletes, other than a California-based team, shall be exempt from Article 4 (commencing with Section 3550) of Chapter 2, and subdivisions (a) to (c), inclusive, of Section 5401.

The section was also amended to define "professional athlete."

Note that the amendment to 3600.5 deals only with cumulative trauma or occupational disease claims.

An athlete who sustains a specific injury, or at least alleges a specific injury, would not be precluded for filing in California.

And this is easily evidenced by the receipt of medical treatment or other medical attention in this state.

Which of course damn near every football player, hockey player or other contact sport athlete gets when that athlete sees the team doctor for some pain or ache, or worse, during a game or practice...

See where I'm going with this?

Once the specific injury is filed and jurisdiction has been implicated in California, it is not any stretch to start adding "compensable consequences" to the claim.

Indeed, this is what the Workers' Compensation Appeals Board seems to be hinting at in some recent panel opinions (though I'm sure the commissioners aren't actually saying this, but it is a reasonable interpretation).

Reginald Slater filed a claim with the Minnesota Timberwolves seeking California jurisdiction.

Slater had played professional basketball for the Denver Nuggets, Portland Trail Blazers, Dallas Mavericks, Toronto Raptors, Minnesota Timberwolves, New Jersey Nets and Atlanta Hawks from 1994–1999 and 2000-2003. He also spent two years playing basketball in Europe.

Slater was with the Minnesota Timberwolves from 2002 until 2003 and that year, he came to California four times for games.

He filed a claim for benefits in California, asserting that he had hurt a finger during a game in California while he was playing for the Denver Nuggets, and that he suffered wear and tear on his knees in the games he played for the Timberwolves in California.

Slater said he reported his knee complaints to the Timberwolves' trainer, and he was examined by the trainer while in California.

The Workers' Compensation Judge found jurisdiction under the version of LC 3600.5 in effect at the time (prior to AB 1309 amendment). On reconsideration, the WCAB said that finding was erroneous, as there was no allegation or evidence that Slater was hired in California or that he was "regularly working" in California.

But, the panel concluded that Slater could still bring his claim in California because there was "substantial evidence that (he) was injured in California" and required medical treatment within the state.

Another case, also prior to AB 1309, found jurisdiction where the contract for hire was negotiated in California even though the employer/team was out of state (this has long been the law in California regardless of whether the employee was an athlete, a sales person, executive or whatever occupation).

John Randle had been a defensive tackle for the Seattle Seahawks from 2001 through 2004.

He claimed that he played eight to 10 games in California while he was with the Seahawks, and about 15 or 16 games in California over the course of his entire career. The workers' compensation judge's determination that this was enough to establish that Randle was "regularly employed" in the state was refuted by the WCAB.

But, the WCAB panel said that California still had jurisdiction over his claim because his agent negotiated all his athletic contracts in California.

"An employment contract that is formed over the telephone is deemed a California contract of hire if it is accepted in California," the panel explained. Since Randle and his agent were in California when they agreed to the contract that Randle would later travel to Seattle to sign, the WCAB panel ruled that acceptance took place in California, ergo California jurisdiction.

So we can see how a professional athlete for an out of state employer can still get California jurisdiction: 1) medical treatment for an injury in the state and/or 2) contract of hire negotiated in the state.a

I'm sure there are many other ways to invoke jurisdiction regardless of AB 1309's restrictions.

And once jurisdiction is established the long standing rule of compensable consequence will certainly be invoked to cover other body parts - it just takes substantial medical evidence.

And if you don't understand the concept of substantial evidence (i.e. "good enough") then please read my postings on that concept as well.

Yes, since AB 1309 claims filed by professional athletes are down substantially - but that's only because the law hasn't really been figure out yet by claimant/athletes and their lawyers.

Trust me, they'll figure it out, another "crisis" will be pronounced by some special interest group of employers, and we'll have more specialty legislation that will reset the cycle.

Isn't work comp grand?

Wednesday, February 12, 2014

Erroneous Temporary Safety Assumptions

My friend, the erudite Dr. Jennifer Christian, circulated a story the other day about the increasing trend towards temporary blue collar workers filling manufacturing and other manual labor sector jobs.

The article published by ProPublica, "Temporary Work, Lasting Harm," will raise the ire of the common person, and if its premise is correct then we have a much bigger problem than our little world of workers' compensation is used to dealing with.

Highlighting several instances of temporary worker death, the article points to a significant failing of the American worker protection system in the employment of temporary workers - safety.

Remember why workers' compensation in the US came about in the first place?

The historical underpinnings of work comp in this country was the Industrial Revolution taking agrarian-based workers out of their element, putting them into factories with little to no training or other safety systems in place, and killing and maiming them in the relentless pursuit of corporate profits.

It appears this is happening again.

History repeats...

I won't restate the statistics or the anecdotes in the ProPublica article - you can read that yourself.

That's bad enough - the failure of Big Business to shirk responsibilities to the work force because they are not THEIR employees - but what is really happening is a dramatic shift in the way the work force is hired and used.

As Dr. Christian put it:

"Most of our country’s protective safety legislation (OHSA, et al) puts the burden for safety on the EMPLOYER with the ASSUMPTION that the employer controls the physical workplace and what goes on it – the actual risks. The rise of the temporary workforce makes those assumptions wrong.

"This brings up an even more fundamental and unsettling idea: the concept of the EMPLOYER or FIRM is rapidly becoming obsolete. Firms, whether they offer TV repair or legal services, have historically been a physical location to which customers funnel their purchase orders! And then a physical location from which assignments are distributed to the people who do the actual work and collect their pay. The Internet and virtual commerce allow buyers to find providers directly, assign and deliver work, and exchange money – thus "dis-intermediating" the employer entirely. In this virtual world, employers look like unnecessary middlemen. As employers disappear completely in this decentralized world of the future, WHO will become responsible for protecting INNOCENT and IGNORANT workers? When workers don’t think to SEARCH for information about how to be safe because they don’t know what they don’t know -- HOW can those protections be delivered?"

I know we have case law and statutes that define employee, special employer and other sorts of designations. We have trust systems in place for employers that fail to secure the payment of compensation.

But we don't have in place systems for ensuring safe work places for employees that are foisted into work situations for which they will provide service temporarily.

In one of the vignettes cited by the ProPublica story, the bottling factory where a temporary worker died had been cited numerous times for safety violations but apparently those citations were not a sufficient deterrent - many of the cited anomalies remained.

A temporary worker would not know about these anomalies, nor about the citations, unless there was training and someone told him or her about them.

In the ProPublica example, none of that occurred and the temporary worker was killed on the first day of his first job in his life...

I searched the WorkCompCentral News archives for case examples of temporary worker safety violations and was surprised by how few cases of enforcement action for these cases there were.

Last July OSHA issued 14 citations, with fines totaling $60,300, to Raani Corp. in Bedford Park, Ill., for alleged safety and health violations, including allegedly failing to protect workers from improperly guarded power saws and hazardous chemicals. Over half of the plant's 150 workers are temporary employees.

In December 2011, a worker died from chemical burns sustained at the plant, OSHA reported.

OSHA issued 26 citations, with fines totaling $170,000, to AFL Quality, Inc., doing business as AFL Web Printing, for alleged safety and health violations at its Voorhees facility in 2011. The story doesn't say how many of the company's 260 employees are temporary, but one of the citations was for failure to record the injury of a temporary worker.

In 2009 OSHA issued three citations with fines totaling $50,850 to VersaCold for alleged workplace safety and health violations at its former Nazareth, PA facility. An "other-than-serious" citation was for the alleged failure to record lost-time injuries for temporary workers.

In total when combining "temporary" with "safety" and "citation" in the search terms in the WorkompCentral database only 18 "hits" come up, and some of those stories contain the word "temporary" only in the context of some other issue, such as a temporary barricade, rather than a temp employee.

Remove the term "temporary" from the search and the volume of safety violation stories balloons to nearly 1,200.

Dr. Christian said it best in summarizing this trend - "Most of our country’s protective safety legislation (OHSA, etc.) puts the burden for safety on the EMPLOYER with the ASSUMPTION that the employer controls the physical workplace and what goes on it – the actual risks. The rise of the temporary workforce makes those assumptions wrong."

I think Dr. Christian is right. I've long argued that the Internet is not just a technological revolution, but a social revolution on a scale of the Great Ages of Mankind. I call this current "age" the Information Age.

Great Ages turn previous social and cultural presumptions upside down because of the huge shift in how work gets done. We are experiencing this.

The Information Age changes not only how we think, what we think, and how much we think, but how we get things done - the allocation of resources changes dramatically, and so must the attention of our resource protection systems.

Tuesday, February 11, 2014

Being Professional

The practice of workers' compensation law is relatively relaxed, at least in California, but I suspect the same in most of the rest of the country where it is an administrative system.

That's what attracted me to the practice in the first place nearly 30 years ago. Collegiality, informality - the emphasis was on substance over form, and the primary mission of the practice - delivering benefits to those entitled and discriminating against those not so entitled - took the forefront over everything else.

But relaxed doesn't mean sloppy, and does requires a higher level of self-discipline.

Unfortunately, too many people don't have the discipline to be let loose in an informal, relaxed legal system. Too many need more concrete barriers, more defined lines; perhaps because these folks lack the integrity or control to handle the responsibility that comes with such an insouciant practice.

Or perhaps these folks are, themselves, just sloppy and inconsiderate of the rules.

Rules - these are in place to make sure that everyone is playing on the same field, to keep anyone from having an unfair procedural advantage, and also to put checks and balances on the costs associated with litigation from the institutional perspective.

The California Workers' Compensation Appeals Board collected almost $300,000 in sanctions last year − three times the amount collected in 2012.

The WCAB had been warning that it was going to be tougher on the sloppy practice of workers' compensation law, whether you're an attorney or a hearing representative (in California work comp law one not need to be an attorney to appear before the WCAB, though there are some restrictions and limitations).

While the California Labor Code limits the WCAB to imposing sanctions of no more than $2,500, it can also assess attorney fees and costs on top of a sanction, so a $2,500 sanction can wind up costing much more. 

What's more, California's Business and Professions Code requires attorneys who are sanctioned more than $1,000 to report the sanction to the State Bar (not applicable to hearing representatives since there is no license involved, though the right to appear can be revoked by the WCAB).

Common infractions include citing evidence that's not in the record, citing unpublished cases, attaching documents to petitions for reconsideration, filing frivolous motions and misleading the board by concealment, half truths, or false statements.

And this misconduct sweeps the range of representation - defense attorneys, applicant attorneys, lien claimant representatives, and others.

A definition of "professional" is "a person who is expert at his or her work." A part of expertise in the law is knowing the rules and abiding by them. After all, if a lawyer can not play by the rules, then how can the rest of society be expected to?

It's not about compromising zealous representation. 

It IS about representation with RESPECT for the system and its participants, because without either there is anarchy and you may as well just hide that license in the drawer. Anarchy will have nothing to do with lawyers - when nihilism rules there is no longer a system, no longer rules, no need for procedure, no respect for life, liberty or property.

It's too bad that the WCAB has to resort to such actions and that it can not stick to its primary mission of resolving disputes in claims for benefits, but if those appearing before it can not figure out professionalism, then hard lessons must be applied.

I'm glad to see the WCAB get firm with the degradation of legal practice. The Rules of Practice and Procedure were developed to ensure judicial efficiency, due process and equal protection. Failure to abide by the RPPs degrades the system. Whether the violation is negligent or intentional, the sloppy practice of law, even at the administrative level, should not be tolerated.

I hope the WCAB reports fewer sanction awards in the future, and not because of failure to enforce, but because of professional compliance and competency.

One of the reasons why the practice of workers' compensation law fails to gain the respect of other legal practitioners is the perception of sloppiness, well documented by the WCAB, which is the habitude of many - too many.

Clean it up folks. Take pride in your practice. Stay educated. Stay proficient. Don't abuse the license (or if you're a hearing representative, don't abuse the privilege).

Above all, zealously represent the interests of your client, applicant or defense, by demonstrating professionalism in the administration of workers' compensation benefits.

Monday, February 10, 2014

Don't Use a Bigger Hammer

The California Applicant's Attorneys Association has issued a report keeping Utilization Review and Independent Medical Review in the spotlight.

CAAA says that the Division of Workers' Compensation and other industry group's measurements of the rates of denial and delay on medical treatment can't be trusted.

The various industry reports by the California Workers' Compensation Institute and The Rand Corporation indicate that somewhere between 65% and 70% of all treatment requests are approved without resort to UR, much less getting elevated into the system.

Somewhere around 20+% are denied, another 6+% are modified prior to approval, and the balance gets delayed to some other disposition.

The year examined affects the statistics and the actual ratios, but the above generalizations are close enough for argument.

Adding the CWCI 2012 and 2013 figures to the numbers provided by Rand would show between 2007 and 2013, of the 8,524 treatment requests submitted, 5,908 or (69.3%) were approved without modification or delay and 1,914 (22.5%) were denied.

CAAA states that the variability in the percentage of treatment requests that are approved and denied “suggests that the practices of the claims administrator have a major influence on the approval rate.”

CAAA also takes issue with mixing treatment requests from medical only claims along with indemnity claims.

The statisticians take issue with CAAA's claims of course.

Alex Swedlow, president of CWCI and a co-author of the UR report, said differentiating between medical-only and indemnity claims when examining how claims adjusters handle treatment requests would be inappropriate. It suggests there are different standards of appropriate care depending on whether an injured worker lost time or not, he said.

“The standard of care is the standard of care,” he said. “To try to make the case that you have to have time off work as a test just doesn't make any sense.”

He also says that if every carrier sent every request for treatment to UR would increase cost management expenses dramatically and it would easily be distinguished in carrier expense reporting.

CWCI's study concluded that between adjusters approving requests and utilization-review companies authorizing treatments, 94.1% of treatment requests by physicians are ultimately approved.

CAAA's experience may be different, but there are explanations for that difference.

According to CWCI, an analysis of claims from accident years 2005 to 2010 found an attorney was involved in 80.4% of permanent disability claims and 38.1% of all indemnity claims.

Ergo, the CAAA attorney's experience is already significantly influenced by the fact that these claims already are in a disputed status, and one of the big disputes is going to be medical treatment.

In other words, the CAAA experience is a microcosm of the total workers' compensation environment.

For example, according to CWCI, the average cost of an indemnity claim in Los Angeles was $64,399 if an attorney was involved and $8,193 with no attorney. In Orange County, indemnity claims involving attorneys cost an average $65,681, compared to $9,168 for claims that weren't litigated.

In Sacramento, the average cost for a litigated claim was $66,627 while the cost for a non-represented claim was $8,540.

These numbers of course don't account for severity of injury, the extent of treatment requests, the amount of defense fees, the expense of UR, and a whole host of other unanswered questions that may factor into the total expense experience of a litigated versus non-litigated case.

But CAAA attorneys get cases that aren't entirely representative of the average workers' compensation experience. Their cases already are involved in dispute, are already on a path towards more significant severity (both medical and indemnity), and probably most importantly in the distinction, another set of eyes and hands are meddling in the control of the case.

I had opined earlier that IF there was a problem with treatment requests and out of control UR that the parties need to get together and HONESTLY disclose their numbers and experiences, without the interference of emotion or agenda, to see if there really is a problem and if so what to do about it.

The posturing by constituencies at odds with each other doesn't further the discussion and only makes participants dig in deeper to protect their positions and their opinions.

For instance, how many claimants go to an attorney as a consequence of the UR/IMR process?

Or, how many treatment denials get elevated in attorney involved cases versus non-represented?

And of those, how many are driven by an MPN doctor versus cases that are outside an MPN?

I could go on and on. There are so many unanswered questions surrounding the debate regarding the efficacy and efficiency of UR and IMR that industry statements from any position, party or constituency are almost meaningless, and seem to foster distrust and posturing.

In other words, OF COURSE attorneys are going to question the numbers posited by CWCI, Rand, DWC and others - because their experience on a case-by-case basis is at the extreme end of all claims. Applicant attorneys are, rightfully, going to question and act upon that experience - it is what they know and understand.

And these cases ARE a problem - as noted above litigated claims represent a huge expense over and above non-litigated cases. But they get litigated for a reason which is not easily quantified, and thus not easily understood.

We know anecdotally why claims "lawyer up" and one of the reasons is because medical treatment may have been delayed or denied.

To say that these cases are representative of an entire system is incorrect, just as it is incorrect to say that the overall UR/IMR experience is representative of litigated claims.

We can debate all of this endlessly but to no avail.

The volume of IMR requests had alarmed me, as it had many others in California workers' compensation.

I'm not so sure now. Perhaps it was just reaching equilibrium.

Bottom line - I'm not ready to declare that the present experience with UR/IMR is any overall industry problem. There may be specific issues that need to be addressed, but not on a wholesale basis.

My grandfather lived with us when I was growing up. He was a "master mechanic" back in the days when there was respect for the trades and such designations meant something.

My favorite quote of his is, "if it doesn't fit, use a bigger hammer."

He was of course being facetious.

Let's not let his facetious maxim drive workers' compensation policy.

Friday, February 7, 2014

Pay The Bill & Move On

I drew some fire for my post on January 7 about return to work, "The Misguided Conversation."

And I knew I would with my bottom line conclusion that workers' compensation has nothing to do with return to work (and stay at work - I am using the RTW term inclusive of both).

My conclusion is that there are only two basic purposes to present day workers' compensation: 1) provide medical treatment without hassle (or at least not too much hassle) and 2) provide some money to help make up for the work injury (whether you characterize that as for lost income or future earnings or pain and suffering or whatever - it's payment of money for an injury).

Return to work is only a tool, and a good tool if it can be implemented, because it greatly benefits both the employer (lowering the experience modification factor attributable to an open claim) and employee (returning some self-worth and repatriation into society).

But RTW requires both an accepting employer and a willing employee.

RTW is even tougher now post recession, a recent article published in the Wall Street Journal found, particularly for men aged 25 to 54 - prime working years for men, highlighting that there needs to be an accepting employer and willing employee - both of which may be impacted by external forces, such as the economy.

According the the WSJ story, one in six men in that age bracket don't have jobs.

This tallies up to 10.4 million men.

That's a lot of unemployed.

The reasons are multitudinous, but can be summarized down to 3 basic generalizations: 1) skills and education don't meet the current demands of the market; 2) governmental benefits are richer than the net monetary take from working; and/or 3) physical or mental issues inhibit employability.

The WSJ notes that economists are befuddled by the high rate of unemployability in this age group.

"Economists who had expected the fraction of men working or at least looking for work to be approaching prerecession levels by now are dumbfounded," the story says, quoting Johns Hopkins University's Robert Moffitt, who has researched the subject, stating, "It's unexpected."

The State of Washington reported that its "stay at work" program has paid $19.4 million to more than 2,300 employers who created modified positions for injured workers.

But is that money well spent? What is the actual return on investment for employers? For employees? For the state? And how much of the success of the program, if any, is attributable to the positive alignment of the necessary elements?

Washington's program pays up to half of a worker's base wages for up to 66 days, with the maximum reimbursement being $10,000. It also reimburses employers for training, equipment and clothing costs to keep the worker in a modified job while recovering from an injury.

What the state's Department of Labor and Industries doesn't say is how many of those workers who have gone through the program are still employed by their original, pre-injury employer - note the obligation of the stay at work program is for 66 days...

According to a L&I publication, in 2012 there were almost 85,000 workers' compensation claims that were accepted out of a total of over 101,000 filed. Of those accepted, there were 1,665 completed retraining plans, nearly the same amount as in 2011, the year the program started.

Let's assume that 2013 numbers are about the same, that there wasn't any significant jump or decline in the number of employees "saved" from unemployment by this stay at work program - that means the cost of the program was about $3,800 per worker since inception.

If those workers actually stay employed then that's a pretty good result and a good ROI.

But we don't know how many of those workers remain employed by the employers who participated in the program, since the program is good for only 66 days.

The unemployment rate in the state of Washington, according to the Bureau of Labor Statistics, was 6.6% as of December, 2013. By comparison, California's was 8.3%, Michigan was 8.4% and Nevada was 8.8%.

(Remember that the unemployment rate does not actually reflect people that are out of work. As explained in a 1/10/2014 "technical note" issued by the BLS, "The civilian labor force is the sum of employed and unemployed persons. Those persons not classified as employed or unemployed are not in the labor force. The unemployment rate is the number unemployed as a percent of the labor force.")

The California Workers' Compensation Institute said an analysis of claims from accident years 2005 to 2010 found an attorney was involved in 80.4% of permanent disability claims and 38.1% of all indemnity claims.

There are multitudinous reasons for attorney involvement, not the least of which is that the system is frustratingly complex in California.

One intangible element involved that was noted by CWCI communications director Bob Young is that disruption of work and damage to the relationship between the employee and employer are often caused by longer return-to-work times in litigated cases.

Looking only at the temporary disability claims from the sample, cases involving attorneys were associated with 74.5 days off work, compared to 25 in cases without attorneys. Permanent disability claims involving attorneys averaged 128.1 paid days off work, compared to 66.5 days off in cases not involving lawyers.

For all indemnity claims, time off work was four times higher when an attorney was involved, at 122.8 days, compared to 30.6 in cases with no attorney.

When we put all of this together I conclude: 

1) that RTW is helpful, but is not the goal of workers' compensation; 
2) that the goal of workers' compensation, provide quick and effective medical treatment along with some money without delay or argument, is more important to minimizing claim impact than RTW, or anything else for that matter; 
3) failure to provide quick, effective treatment or money without delay increases the risk of attorney involvement; 
4) if an attorney does get involved RTW is pointless and won't work; and 
5) there are still things you can't control, such as the economy or whether you have an accommodating employer or willing employee, and the best course of action for both employee and employer is to get the claim closed as quickly as possible given the law, regulations and reserve status, even if that means paying a premium that you think is too high.

There's no magic to workers' compensation claims management. Skill on the other hand in navigating a complex system involving deeply rooted emotions is imperative. Forget all the fancy-dancy acronyms and tricky techniques. Pay the bill and move on. THAT's how you control your claim costs.

Thursday, February 6, 2014

How The Law Works

I hear complaints all the time about how lawyers take something "simple" to create major case law exceptions that erode the "original intent" of the law - like lawyers somehow have some magical wizard powers to alter "the law."

Usually, when you peel back the onion skins on the anecdotes purporting to prove this point, we find that the language that the lawyers allegedly take advantage of is: a) menacingly under or ill defined; b) failed to take into account a specific fact pattern; c) is so egregious that it works a huge unfair penalty against certain persons (see "b"); or d) the legislature during the negotiations phase gave up and decided to let the courts figure it out, which means the lawyers likewise have to figure it out.

This happens all of the time with new legislation, which is why when there are broad-stroke changes to statutorily derived rights, benefits and liabilities (e.g. workers' compensation) it may take years before such a system stabilizes into some form of predictability.

California's SB 863 is such a perfect example of this maxim that it can not be ignored.

In 1989 the California legislature, in reaction to the trend at that time of making psychiatric/mental injury a part of every claim, passed into law Labor Code section 3208.3, which set certain thresholds for the compensability of such claims.

At first there was a spat of challenges to the law and it seemed that new case law on that statute was coming out nearly every other month, until eventually the new borders established by that code section were nicely defined by the courts.

That process took about seven years, or so it seems.

And that is, in general, about how long it takes for fresh legal language out of the legislature to make its way through the appellate refinement process.

But that doesn't keep legislatures from throwing some new challenges to the courts, and in the case of SB 863 there is plenty of judicial distillation to occur.

One of the zingers that the legislature was warned about early in the process of writing SB 863 was the exception for "catastrophic injuries" to LC 4660.1 regarding permanent disability.

The legislature reacted to the trend of incorporating "off schedule" issues to a permanent disability rating (sleep disorder, sexual dysfunction, etc. - stuff that nobody can really prove...) by adding new language that attempts to put a restriction on these add ons.

But an exception to the exception is that if there is a "catastrophic injury" then such add ons may be applicable.

This is creating a bit of debate in the legal circles.

Some are thinking that this language may supersede portions of LC 3208.3, others say that the sections are different and that there is no inter-relationship.

Still others believe that there might be some relationship in concepts but that operational effects are going to be different.

Each argument is going to be based not only on the perceptions of the position asserting the point, but also on the desired outcome for any particular set of facts (i.e. a case).

In law school, particularly in the early years, prospective lawyers are thrown all sorts of legal concepts and law, and then there were exceptions that had to be considered and distinguished, and after that there were always exceptions to the exceptions.

I dealt with this attempt to create legal psychosis by recognizing that in the vast majority of such examples the exceptions to the exception was simply going back to the underlying, fundamental basic law - if I analyzed what the base law said carefully then there was no need to memorize the exceptions to the exception; it was simply a restatement of the original legal concept in response to a particular factual pattern.

And so it is with "catastrophic injury", LC 4660.1 and 3208.3.

Adam Dombchik, a past president of CAAA and a partner with Gordon, Edelstein, Krepack, Grant, Felton & Goldstein, was quoted in a WorkCompCentral story this morning about this issue, and his analysis aligns with my legal rationale.

Dombchik said that what a case will boil down to is simply an inquiry into whether a worker has a "legitimate, verifiable, substantially-supported claim" for a psyche injury, because "valid claims should have benefits paid," no matter what definition eventually gets assigned to "catastrophic."

Yes, the legislature failed to give specific definition to "catastrophic injury" and, yes, this will create litigation. Litigation ultimately will create case law and over the course of the next seven years this term will be more well defined.

That's how the law is made. Will The People be patient enough for the law to work?