Risk Sensitivity and Dangerous Neigborhoods

At the heart of workers' compensation, or any insurance based program for that matter, is risk management.

Risk management entails understanding the fundamentals of a process or system, exploring the possibilities of an event interfering with that process or system, then implementing strategies or preparations to mitigate any negative outcome should such an event occur.

This requires a bit of soothsaying - one must have a broad enough imagination, typically fostered by historical education - to "see" the possibilities.

Science is involved too. Probabilities can be assessed with mathematical models; known cause and effect can be weighed based on past experiments; and a bit of art might be used as well to finesse outcomes and influence psychology.

A great teacher in risk management is aviation. The act of flying is inherently risky. Those in aviation know the risks, understand the probabilities, and implement methods and actions to mitigate those risks most of the time.

Failure to mitigate risk invites disaster, and even small risks can be catastrophic given a particular set of circumstances.

John and Martha King are icons in aviation, because of their famous pilot training materials and courses. They are passionate about flying safety, both having been through tough lessons throughout their careers.

John King recently blogged about the single biggest cause of aviation accidents, loss of control. In that post King speaks about acquiring sensitivity to dangerous elements, or what he calls "dangerous neighborhoods." Like walking into a dark alley, or an unwelcome situation, he says we need to be able to “smell” trouble.

"Sometimes avoiding loss of control requires good stick and rudder skills," he writes. "When we talk about stick and rudder skills, we are often thinking mostly about the physical manipulation of the controls. But knowing what to do with the controls and when is key. That requires a sensitive 'seat of the pants'—a feel for what the airplane is doing."

King says there are two overriding "sensitivities" to which pilots must pay attention. One has to do with whether the wings of the aircraft are equally exposed to the relative wind, and the other has to do with how much G load is on the wings.

"Pilots who have these two sensitivities are far more likely to keep their airplane under control even if they do stray inadvertently into a 'dangerous neighborhood,'" concludes King.

Risk management includes sensitivity to gremlins...

The California Division of Workers' Compensation seems to have acquired a bit of loss of control sensitivity; Utilization Review and Independent Medical Review appear to be challenging to the claims community either by management fiat, process ineptitude, or just plain overwhelming work load.

Regardless, DWC is likely getting frustrated that the process is failing at the base level: failure to provide all medical records to the reviewer so that a fair decision can be made about a treatment request.

Yesterday DWC issued a notice of pending regulations that would impose penalties on claims payers for failing to provide all medical records to a reviewer.

I was told that one claims house had imposed an arbitrary limitation of 50 pages of records to be submitted for any treatment review request. I have to assume that DWC likewise has similar information.

Even anecdotally, by simple review of IMR decisions posted on the DWC website, one can see that there is a failure to supply records problem.

A recent Maximus webinar concluded that the primary reason for the current delays in issuing IMR determinations is delay in receiving records.

A copy of slides from the Oct. 22 webinar states that about 19,000 of the 42,000 open IMR cases "are missing medical records past the deadline for submission." A Notice of Assignment and Request for Information on about 80% of those 19,000 open cases without medical records was not sent until on or after June 1, 2014.

There are IMR decisions posted on the DWC site that flat out deny requested treatment due to lack of medical records: 13-103, 13-114 and 13-119 all include notices that the claims administrator had not submitted medical records for review in the case. All three decisions, which had been issued before the DWC rescinded the other two decisions, affirmed the UR denial anyway.

These are just representative of a larger issue that wasn't taken into account when UR and IMR were dreamed up: either willful, or negligent disregard for the process.

In other words, the law, and its implementation, lacked sensitivity to factors that have lead to loss of control in the medical review system.

There simply was not good risk management in the construction and deployment of the UR and IMR concept.

The concept was good, in my opinion. Workers' compensation had grown into a free-for-all medical treatment system. Anything that a doctor "ordered" or prescribed was ipso-facto regarded as "reasonable and necessary" because there was a couple of extra letters at the end of the name of an "expert."

This, of course, lead to abuse, which of course lead to "reform," which may or may not be effective depending on how all of the players in the system react to the environment.

And it turns out that there really wasn't a good understanding or appreciation for the neighborhood we were entering - most people play nice, but a couple of them, for one reason or another, don't seem to be able to abide by the rules.

So now DWC has to implement even more rules and regulations to control that minority that has a tough time understanding their roles in the bigger scheme of benefit delivery.

Diane Worley, director of policy implementation for the California Applicants' Attorneys Association, told WorkCompCentral that the problem starts at UR and has been ongoing for some time.

"Unfortunately, this problem begins with utilization review, where there are many denials of requests for medical treatment issues because no records were provided," she said. "A solution to the problems with UR needs to be addressed, too. You can't have evidence-based medicine without evidence."

When new laws and regulations are contemplated, those responsible should take a walk through the dangerous neighborhoods so they can appreciate the risks, or at least talk to those who have been through those neighborhoods to acquire better sensitivity to abnormal characteristics.

Creating law also requires risk management skills.

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I'll be off line for the Thanksgiving Holiday; back on Monday December 1.

The Mom Standard

"Pretend the injured worker is your Mother. Now tell me how you’d like to have this case handled."

That's how one industry consultant describes what he tells claims administrators handling cases for his client employers.

The analogy is perfect in my mind, particularly when I ask audience members at various speaking engagements whether they would choose to be treated for an injury or illness under the work comp system, or defer to general health.

Every time I ask there is only one, maybe two, people that choose work comp over general health - despite the fact that work comp entails much less out of pocket expense (no deductible) and, despite the proliferation of treatment guidelines, a greater menu of available services covered.

I suppose these informal, highly non-scientific, anecdotal surveys reflect a concern among industry professionals that the care they would receive if there were a work injury or illness would fall below the Mom Standard.

Last month the Mom Standard was tested, and I wrote about it - Mom, at 90 years old, contracted pneumonia. Her care facility acted quickly, and largely because of the rapid response by them and the medical team at Palomar Medical Center had her back to her residence in 3 days, and fully rehabilitated in 2 weeks.

Palomar Medical Center, Escondido, CA

That's the Mom Standard of care - quick, direct, aggressive medical care early - and the result is a positive outcome.

There's a lot of times when that standard isn't met in workers' compensation cases, and there's a number of reasons, all of them fall under an overarching cause: work comp might be a "no fault" system, but it is very much a liability allocation system.

Fault is "responsibility for failure or a wrongful act."

Liability on the other hand deals with "money owed; debts of pecuniary obligations."

Liability in workers' compensation gets in the way of the Mom Standard of care, particularly when the obligation to pay is assumed by a third party under an insuring contract.

The industry seems consumed with "costs." It seems that no matter what the analysis of any particular case or situation, there is always some mention of costs - and that's because someone or some entity is liable; i.e. is responsible for paying the bill.

For instance, the California Workers' Compensation Institute released a report the other day reviewing trends in medical benefits in workers' compensation.

A 19.4% increase in costs for prescription drugs and durable medical equipment in 2012 drove an overall 2.3% increase in average medical benefit payments per indemnity claims, CWCI concluded.

Carriers paid an average of $16,375 in medical benefits per indemnity claim at the 24-month period for accidents occurring in 2012, compared to $16,003 on claims for injuries occurring in 2011, but the overall amount paid for medical treatment actually dropped slightly to $10,903 on 2012 claims from $10,931 on 2011 claims.

In the meantime, medical cost-containment expenses increased about 2% to $2,330 from $2,283 per indemnity claim.

This is all good and well - the payer part of the industry does need to know where the money is going. I get that.

But obsession with where the money is going tends to overshadow why the money is going there.

CWCI reported that average medical costs dropped on 2004 and 2005 claims following the reforms of the early 2000s. From 2005 to 2009, payments for all four subcategories of medical benefits increased steadily.

Medical-cost containment expenses were the fastest-growing subset during this period. CWCI attributes this to the adoption of the Medical Treatment Utilization Schedule, mandatory utilization review and the introduction of medical provider networks through the early 2000 reform measures. Average medical-cost containment expenses of $2,173 on 2009 claims were 217% higher than the $685 paid in 2002.

But average total medical benefit payments at the three-month valuation point were relatively stable until accident year 2008, when they increased 32.1% to $2,483 from $1,879.

"The average amount paid for medical benefits at three months post injury on more recent claims declined slightly in AY 2011 and AY 2012, but then jumped 28.1% in AY 2013 and 12.1% in AY 2014," CWCI wrote. "These sharp increases in average medical paid at three months post-injury may indicate faster delivery of initial medical services rather than a significant increase in the volume of medical services that were eventually delivered. The impact of the SB 863 medical reforms may become clearer as more developed data from AY 2013 and AY 2014 become available, though the preliminary data on medical payments at three-months post-injury indicate the 2012 reforms were not associated with any reduction in overall medical payments per indemnity claim during the initial period following the injury."

All of that to say, basically, we're not sure whether effective care is being obtained by injured workers in a timely fashion.

Then there are the anecdotes that our focus is misplaced, that we're not using the Mom Standard.

In a comment to the story in WorkCompCentral about the CWCI report, "screwed in this system" says he has been denied the only follow up post surgical therapy he can tolerate, aqua therapy, so he pays for it himself. He has been through the Utilization Review and Independent Medical Review process.

He states, "How much did two UR reviews and an IMR cost as apposed to just providing me with the post spinal surgery PT? The ONLY reason it was denied in the first place is due to claims adjuster not providing relevant records."

Failure of the Mom Standard...

Because concerns of liability trump the Care of Mom.

Think of Mom, then deliver the care.

Maybe then, by next time I take an informal poll of our colleagues, I'll get more hands favoring work comp care over general health.

On Any Sunday

I was 12 years old when the original On Any Sunday, by Bruce Brown, was released in the theaters.

Only 2 years into motorcycle mania, I can't tell you how many times me and my likeminded buddies rode our bicycles to the theater that summer to watch Malcolm Smith, Steve McQueen and Mert Lawill do what I wanted to do every single day of my life.

I still get goose bumps just thinking about the theme song.

And my wife, who grew up in a much more innocent Malibu in those days, remembers McQueen, her neighbor, riding his motorcycle up Broad Beach Road to retrieve his dog, Junior (named after McQueen's 1972 movie "Junior Bonner"), who routinely escaped to retrieve treats from that little 10 year old girl.

My wife loved Junior and she gladly dog sat for free - volunteering so to speak. And it didn't matter that the owner was a famous movie star; she still volunteers to rescue dogs and get them to good homes. Volunteerism is part of her.

Back to the movie: now Brown's son Dana has taken over the family legacy with a new On Any Sunday, The Next Chapter - and I can't wait to see it.

In an earlier post I used motorcycle riding as a metaphor for the need to deal with the mental aspect of work injury or disease (or LIFE for that matter); that I've had many, many injuries (some life and/or potentially career ending) either tells me I have a tougher mental profile than most, or I'm just stupid.

Might be both - at least that's what my wife tells me.

There's a big, international market for the therapy that motorcycles provide. Brown's film is testament to that.

There's culture and community - a really big community.

Culture, community.

Back in the "old days" it was only Harley riders who would acknowledge this community, and only to each other. A wave of the hand passing by was the signal that you were "in." The Harley exclusivity has given way to the larger population of all makes and models, and nearly every rider signals to each other "the brotherhood" regardless of make, model or gender.

As is typical with a community there are lots of volunteers for nearly anything and everything that is motorcycling. Events have volunteers to mark course, clean up, assist parking, ticketing, etc. Volunteers make up organizations. Motorcyclists help each other. It's part of the community and culture.

Famous business guru, Peter Drucker, said, "Accept the fact that we have to treat almost anybody as a volunteer." Drucker back then likely knew more that we appreciate about volunteers and risk.

Real volunteers that do real work sometimes have to be insured against work accidents, and this sometimes is not possible to provide within small budgets.

The people of the Village of Middleburgh, NY, population 1,483, had been asking their elected officials to do something to ensure their safety after a stabbing, so a retired policeman came forward and volunteered to serve as a constable for the tiny town.

The town's risk manager and insurance agency, however, told the town's board that doing so would be costly.

New York is one of the few states in the nation where state law specifically says that volunteers working for nonprofit organizations are eligible for comp benefits.

Many states specifically extend their comp acts to provide coverage for volunteer firefighters, police officers and paramedics, but unpaid workers outside these fields are subject to a wide variety of treatment. Sometimes an organization doesn't find out that a "volunteer" is really an "employee" until after a risk has occurred, creating some form of liability for the organization for which it wasn't prepared.

If the village decides to appoint an unpaid constable, according to the town's agent interviewed in a WorkCompCentral story this morning, the insurance company would look at the average salary for a comparable worker in other municipalities to calculate an appropriate rate to charge for comp coverage.

Plus there's the liability side, for which the small town would purchase more insurance, in addition to written policies and procedures, and other employment-like minutiae.

"Institutions relying on the services of volunteers to carry out their work should keep in mind the first law of capitalism: there is no such thing as a free lunch," says Jon Coppelman, a principal with the Boston-area consulting firm, Lynch Ryan & Associates and himself a prolific blogger.

The realization that insurance is a proper risk mitigation strategy that is going to cost some money by that small village in New York may dampen volunteerism, or it may be not.

Volunteerism is a part of community, a part of culture. Where there's a need there's usually someone willing to help out at no direct cost.

"It's a disease and once you have it, it doesn't leave your body ... ever," 24 year old deaf women's motocross champion, Ashley Fiolek, says in the movie trailer about motorcycling.

"There's a lot of injuries that happen along the way, but the human spirit will never die." one of the narrations goes on to say in the On Any Sunday, The Next Chapter trailer.

Filolek may just as well be talking about volunteerism; There's no free lunch, there may be some injuries, but the spirit won't die.

Certain Uncertainty

As the token Californian on the Blogger's Panel at the National Workers' Compensation and Disability Conference in Las Vegas yesterday, I drew fire from moderator Mark Walls, and a bit of derision from my fellow panelists.

"Mark, you know why California is so expensive?" I countered to his question to me about the cost of work comp in California. "Because it's worth it..."

At least I got the most laughter out of the attendees for the session.

But in all seriousness, California's issue isn't that the system is so expensive - as I implied to the audience in my quip to Walls: the state has always ranked high relative to costs.

That's not the issue. The issue is whether the California system delivers adequate and timely benefits to injured workers at a reasonable cost to employers. It doesn't have to be the cheapest, it doesn't have to deliver the most.

It just has to be reasonable, and in order to be reasonable it must be consistent, dependable, reliable; in other words, certain.

Utilization Review (and Independent Medical Review) is one of those things that was intended to bring some certainty to the medical treatment delivery process, but as we have seen that mission doesn't seem to be making it into operations.

Yesterday the Workers' Compensation Appeals Board certified an opinion as "Significant Panel," meaning it can be citable authority, about UR again, reinforcing the concepts discussed in the WCAB's second Dubon opinion about timeliness of a UR request: that a UR decision made within the time frame allowed by the Rules of the Administrative Director, but issued to the worker one day too late, is invalid.

uncertainty

Ergo, the WCAB gets to decide the necessity of the medical treatment at issue.

In Bodam v. San Bernardino County, Timothy Bodam was injured on March 24, 2011.

His primary treating physician referred him for a consultation with orthopaedic surgeon Wayne K. Cheng.

After examining Bodam, Dr. Cheng determined that surgery would improve his condition and on Oct. 28, 2013, he faxed a request to the county's adjuster for authorization to perform a three-level fusion.

The adjuster from the State Compensation Insurance Fund forwarded the request to utilization review that same day.

The reviewer made the decision to deny the request on Oct. 31, but the SCIF did not mail written denial letters to Cheng, Bodam and Bodam's attorney until Nov. 5.

Labor Code Section 4610 requires a payer to issue a UR decision on a request for prospective treatment within five days from the point in which the reviewer receives the necessary information to issue a decision. Thus, the UR decision on Cheng's request – coming three days after the request was submitted – clearly was timely.

However Section 4610(g)(3)(A) imposes further mandatory time requirements for communicating a UR decision, obligating the payer to communicate the UR decision to the requesting doctor within 24 hours of the decision.

The statute also requires that this initial notification be followed by a written notice within two business days.

The board panel said that Section 4610(g)(3)(A)'s 24-hour time limit begins to run from the date the UR decision is made, even if the UR decision is made in less than five days.

As there was no evidence that SCIF informed Dr. Cheng of the UR denial within 24 hours of the decision being made on Oct. 31, the WCAB said that the decision was "untimely and invalid for that reason."

The decision was also untimely because the written notice didn't get sent within two business days after the decision was made, the board added.

Okay, so now the courts get to decide whether or not medical treatment is reasonable and necessary, but what the Boden case is really about is the failure of the system to meet the mission; the Boden case is all about failing to deliver medical care, and costing a whole lot more than is necessary.

Boden was injured 191 weeks ago, almost four years. It took until October 2013 to get to the point where a physician decided surgery was needed. The board didn’t decide on the failed UR until December 2013. Now, here we are, almost a year later trying to decide what the right thing to do is.

SCIF has spent tons of money fighting the obligation to give this poor man the treatment he needs, deserves, and is entitled to. It would have been cheaper to authorize the surgery, particularly if one looks at all of the ancillary costs to the employer (a governmental entity for which its citizens pay taxes so this impacts all citizens) such as lost productivity, employee replacement costs, overtime, etc.

This case is an indictment against The System, against the carriers, and against the medical providers – everyone is complicit and everyone is guilty.

In the end, this poor fellow still doesn’t have what he needs – treatment for a workplace injury.

The WCAB ‘kicked the can down the road’ by requiring additional medical evidence the surgery is necessary. Worse, the ‘burden of proof’ has transferred to the employee.

In the end – nothing was accomplished. The UR rules are the same as they were ten years ago, the WCAB affirmed.

SCIF blew it and I suspect they knew it.

In the end, the injured worker still isn’t going to get the treatment a Board Certified Medical Doctor determined was needed, and the costs have piled up (and continue to pile up).

And there still is no certainty.

Serendipitous Repetition

Serendipity seems to follow me.

I was, of course, at the National Workers' Compensation and Disability Conference at the Mandalay in Vegas last night, attending a cocktail party, and became engaged with a Certified Shorthand Reporter, aka court reporter to those who don't wander the Halls of Justice.

I don't recall which jurisdiction she was from, but we were talking about how CSRs were going out of favor, sometimes being replaced by technology and sometimes not being replaced at all.

I was in hyperactive mode, and rambled something largely unintelligible to her. She wistfully replied, "say again counsel."

And that put us into a discussion about how, in certain circumstances, technology can not replace a human doing the job of a CSR - because a machine can not stop the person whose speech is unintelligible and request a restatement, and then certify to others that what is transcribed onto paper is what was actually said.

In her jurisdiction the courts no longer provide a CSR at taxpayer expense, so counsel must hire their own out of pocket and hopefully recoup that cost later in the case. Sometimes the opposing parties will agree to share the cost of a CSR because if there's any anticipation of appeal a certified transcription of testimony will be necessary for a complete record going up to the appellate court.

Then I wake up this morning, and the top headline in WorkCompCentral News is "Supreme Court: WCC Must Provide Stenographers for All Hearings."

Whoa! Did I really have THAT much to drink last night? Or was someone eavesdropping?

Turns out that yesterday the Oklahoma state Supreme Court released an opinion that the Workers’ Compensation Commission will be required to provide a stenographer for all of its hearings.

The 7-2 decision came after attorneys filed an application for original jurisdiction with the high court on behalf of six claimants who were denied commission-provided court reporters for their case hearings.

Guaranteed by the OK Sup. Crt.

Supreme Court Chief Justice Tom J. Colbert took authorship of the one-paragraph decision, assuming original jurisdiction of the case and directing the commission to provide a stenographer for all hearings before the commission.

As you likely are aware, the state went through a bit of trauma last year when legislators overhauled the workers' compensation system, including its administrative dispute resolution process, and also implementing a form of "non-subscription" to better compete with neighboring Texas.

As part of that reform, a new Workers’ Compensation Commission was created to handle hearings for claims of injuries on or after February 1, with the Court of Existing Claims handling legacy claims.

The WCC rushed to implement emergency rules to accommodate the deadline and part of those rules provided that the commission is required to make an audio recording of all hearings before the commission or administrative law judges. The commission is also required to provide those recordings on digital media to any requesting party at no charge.

But a court-reported transcript would be made “at the request and expense of the person ordering it, or at the request of the Commission, in which case, a copy will be made for any person requesting it, at that person’s expense.”

That WCC's rule, found in Title 810:10-5-48(d), conflicts with Title 85A-72(B) in the state’s Workers’ Compensation Act, which just states that all commission hearings “shall be open to the public and shall be stenographically reported.”

“To the extent that Emergency Rule 810:10-5-48(d) conflicts with the requirements” of the workers’ compensation statute, Colbert wrote, “the Commission is prohibited from providing only an audio recording of all hearings, in lieu of a stenographer.”

“Because we have many workers in Oklahoma that don’t speak flawless English,” one of the attorneys who petitioned the Supreme Court, Bob Burke, told WorkCompCentral. “So an oral recording would not work on appeal. Because with a court reporter sitting there, if they don’t understand that word, they can literally say, ‘Sir, could you repeat that,’ or ‘How do you spell that?’”

So there you have it - another serendipitous moment comes to life.

"Could you repeat that please?"

10 Challenges, Simple Mission

Just in time for the Blogger's Panel at the National Workers' Compensation and Disability Conference in Vegas this week, Insurance Journal reporter Andrea Wells interviewed several folks (including Blogger panelist Joe Paduda) about the 10 big challenges facing workers' compensation this coming year.

Here's the short list, but I encourage you to read the entire article:

Wage Stagnation; Technology and Innovation; Opioids; Pot; the return of American Manufacturing; the Affordable Care Act; Safety; Terror; Demographics and Mobility.

These are all very good topics for discussion and I'm sure my fellow bloggers will gladly debate all of these.

But this list is a mask for the real challenge: credibility with employers and their workers.

Which is the underlying theme of a survey released this week by Rising Medical Services.

While 83% of the Rising Medical survey respondents include staff development in their strategic goals, there aren't that many actually walking the walk: the survey showed that much fewer are actually spending time and resources on staff development.

About 48% reported that they have a dedicated training and development group, down from 54% last year. About 36% said that they train new hires, down from 42% in the 2013 survey. More companies — 51% compared with 49% last year — conducted training for senior-level staffers, but those levels still fall short of the number of companies that list development as a priority.

Rising Medical noted that previous research suggests a “talent gap” in insurance claims management. A 2006 study from Deloitte Consulting showed that about 70% of claims adjusters at the time were 40 years old or older. The study also projected the need to hire 84,000 more claims adjusters industry-wide by the end of 2014, based on current employees vacating their positions and a 17%-per-year average growth in new hires.

However, the survey showed that new hires coming into the workers’ compensation industry are less likely to receive training than senior staffers. Of the 36% of respondents who reported having a training program for new claims adjusters, 42% said the training took less than 40 hours.

About 22% of all respondents had no budget for training and development.

“For the workers’ compensation industry, the business risk for not investing in a talent development strategy is significant,” the report says. “Claims examiners are an organization’s primary face to customers, and they make decisions on a daily basis that can considerably impact business profitability.”

And, I might add, real people's lives...

Sharing one of the themes of Wells' article, the survey showed that the claims community is lagging in the adoption of productive technology.

About 42% said they used some form of claims system workflow automation, but one-third said they had no integration between various parts of their claims systems, meaning that information isn’t shared between segments such as bill review, utilization review, medical care management and fraud detection.

So it's, unfortunately, easy to see where major claims decisions - that affect both business AND injured workers - can fall through.

And of course, contrary to tradition but certainly in line with the preaching that has gone on for years, the Rising Medical report found that medical care is misdirected to physicians with lower fee-per-unit charges, rather than to those with demonstrated superior outcomes.

The difference can be, based on a study by Harbor Health Systems released in July, a drop of about 20% in overall medical costs, at least during a five-year period when such “high-performing” doctors treated patients under the Harbor Health study (which doesn't account for lower indemnity costs too).

So the industry does have a lot of challenges - and all of these challenges ultimately are about improving relations with "the boss", i.e. the employer, and "the customer", i.e. the injured worker: our credibility as an industry.

I've said it before and I'll say it again: all we really have to do is make sure that benefits that are due are in fact delivered timely and effectively.

These "challenges" highlight that simple mission, but really is just noise. Hire good people, give them excellent training and keep it going, and give them computing systems that actually help the mission.

And then get out of the way.

The online form to request a copy of the Rising Medical survey results is here.

Immigration, Obama and Bloggers

Tomorrow legions of workers' compensation professionals will descend upon Las Vegas for the annual Bacchanalia commonly known as the National Workers' Compensation and Disability Conference at the Mandalay Hotel.

Of course I'll be there, part of the popular Blogger's Panel in which we debate the workers' compensation issues of the day.

On Thursday at 3:45 p.m. Joe Paduda, Becki Schaffer, Bob Wilson, and I will field questions from Mark Walls.

Walls decided to prime the pump yesterday by sparking interest in President Obama's announcement that he is considering amnesty to undocumented workers by executive order.

"If President Obama makes 5 million illegal aliens legal by executive order, what impact positive or negative could this have on the workers comp industry?" Walls wrote to the group.

This started off a firestorm with Paduda and Wilson trading barbs at each other all day long by group email.

Great Mark, thanks for getting these guys fired up!

Schaffer threw up a graphic demonstrating that incurred losses would go out of control, at least for a year or two, based on statistics from when President Ronald Reagan pushed for immigration reform back in 1986.

Schaffer's graphic

In 1986, Congress and Reagan enacted a sweeping overhaul that gave legal status to up to 3 million undocumented immigrants, if they had come to the U.S. before 1982. Spouses and children who could not meet that test did not qualify.

This segregation incited protests that the new law was breaking up families.

Early efforts in Congress to amend the law to cover family members failed. In 1987, Reagan's Immigration and Naturalization Service commissioner announced that minor children of parents granted amnesty by the law would get protection from deportation.

Spouses and children of couples in which one parent qualified for amnesty but the other did not remained subject to deportation, leading to efforts to amend the 1986 law.

Likewise, the Senate acted in 1989 to broaden legal status to families but the House never took up the bill. Through the Immigration and Naturalization Service, Bush advanced a new "family fairness" policy that put in place the Senate measure. Congress passed the policy into law by the end of the year as part of broader immigration legislation.

Obama's anticipated executive order could come as early as this coming week and cover as many as 5 million people. Like Bush, Obama is expected to extend deportation protections to families of U.S. citizens or permanent residents.

Whether or not there is any big impact on workers' compensation is, of course, subject to debate. Paduda argued to the group that there would be no great impact and that the nation's immigration policy was a waste of money - that funds presently used to support a massive presence at the borders was better put to use on real criminal enforcement.

Wilson argued that there are laws in place for a reason and that Obama was being arrogant and had no legal authority to declare 5 million people "legal" by his fiat.

Separately, Peter Rousmaniere, not on this upcoming blogger panel but one who also has a distinct opinion on immigration, feels that there may be a slight up tick in claims because these workers tend to occupy the most injury prone jobs.

"This may happen in earnest in selected situations, where undocumented workers have reported relatively few of their injuries and now feel empowered to file claims, with claimant bar and activist group encouragement," Rousmaniere writes in a WorkCompCentral column (free to all). "For the workers' compensation field as a whole, the impact could be modest. Even if the number of lost-time compensable claims of undocumented workers increased by 50%, the total increase of such claims in the workers' comp field would be, I expect, a couple of percentage points, spread over several years."

The reason, Rousmaniere notes, is because, "Among the largest 100 jobs, undocumented workers account for about 4.5% of all workers. Because they tend to hold more injury-prone jobs, they likely incur about 8% of lost-time compensable injuries – or would if they filed claims at the same rate as authorized workers do."

As with any big issue the questions and the answers are not so clear and easily established. There will be winners and there will be losers.

Potential winners in this program, at least in the short term, are the insurance companies that should see increased premiums as a result of increased payroll reporting; that is assuming that the employers which traditionally tend to skirt employment laws actually comply when their workers are no longer "undocumented" and because, experience has taught us, once these workers become "documented" and, ergo, "legal" their wages tend to increase.

In addition, the industries in which the most undocumented workers are found are among the highest in occupational risks: farming, construction, hospitality, and institutional (building and grounds maintenance). Those occupational codes rate much higher and thus produce much larger premiums.

My best guess is that there isn't going to be any great impact on workers' compensation overall, that the industry will move along like it nearly always does with the various parts doing what they do best, California will be most heavily impacted (because it has, by far the largest immigrant population employed in the most hazardous occupations) and there will be some scapegoat identified somewhere upon whom we can foist collective discontent.

Come to the Bloggers' Panel Thursday at 3:45 to get more of this barb tossing (breakout session CM6).

Evidence Based Mental Health

What a great weekend. 

N6641M took me on a visit with Mom on Saturday (she's doing great!), then to see my life long friend, TZ (we literally have been together since 2 years old) to go to the International Motorcycle Exposition at the Long Beach Convention Center, then a Sunday morning motorcycle ride up Angeles Crest Highway to Newcomb's Ranch for breakfast, and then a nice (but Santa Ana wind swept) bicycle ride in the afternoon followed by a delicious tri-tip dinner... My mental health yesterday peaked at an all time high.

Imagine that - what could be better than seeing loved family, wonderful life long friends, flying airplanes, drooling over and then riding motorcycles and bicycles, and filling the tummy with delicious wonderment - a life affirming, psychologically stimulating time important to mental health.

I'd been on a huge path to burn out prior to this weekend - the stress of numerous speaking engagements in November, the upcoming WorkCompCentral Comp Laude Gala, running a business and all the uncertainty and stresses, plus all of the other complications in life...

My wife texted, after seeing a picture of me that was sent to her, "you look extremely happy David," to which my son dutifully replied, "that's because motorcycles make one happy."

They're both right.

I'd say that this past weekend was a great experiment supporting all of the evidence out there that mental health is as much, if not more, important to good functioning than nearly anything else.

Happy - motorcycles do that.

The workers' compensation insurance and claims community is big on evidence-based medicine. We hear it all the time about supporting a treatment decision based on scientific evidence; that's what utilization review and independent medical review, treatment guidelines, etc. is supposed to be all about.

But there is a huge component of science the industry chooses to ignore: psychology typically makes up a larger component of outcomes than any physical treatment.

There are several professional medical organizations (such as the American Academy of Orthopedic Surgeons or the American Academy of Disability Evaluating Physicians) that have, for years, been espousing the science behind this concept - that an injured worker's mental health is as much, if not more, important to good outcomes than nearly anything else. There are numerous studies and peer reviewed papers published in credible medical journals supporting this.

And a pair of articles published in this month’s issue of The Spine Journal support this concept even further.

Researchers principally from University of Zurich in Switzerland conducted a review of previous studies and found that two psychological phenomena – catastrophizing and fear-avoidance beliefs – are associated with return to work and levels of pain among patients with lower back pain.

Catastrophizing is essentially a thinking pattern that elevates perceptions of problems to catastrophic levels. Fear avoidance is refraining from engaging in behaviors out of concern that it will increase pain.

There are two common methods used to determine a patient’s level of fear avoidance. A team of researchers led by Gordon Waddell, a professor at Glasgow, Scotland’s Western Infirmary, created a fear-avoidance belief questionnaire in 1993 that creates a number score. The questionnaire asks patients to agree or disagree based on a numbered scale with statements such as "I should not do physical activities which make my pain worse" and "my work might harm my back."

The Tampa Scale of Kinesiophobia, developed in 1991, is structured in a similar way and asks comparable questions to produce a score.

The score a patient gets based on those responses, according to the University of Zurich researchers, is associated with the outcomes patients had. Several studies included in the review found higher pain levels and fewer patients returning to work when they had higher scores. When patients went through interventions targeting those problems, they had better outcomes.

A series of studies from the Workers Compensation Research Institute bolstered the evidence supporting that theory in June. The studies, which examined predictors of worker outcomes in eight states, surveyed more than 3,000 workers in those states. When asked whether they feared being fired because of their injury, 52% said they strongly disagreed, 9% somewhat disagreed, 12% somewhat agreed and 27% said they strongly agreed.

The survey was conducted in 2013, and the participants were all injured in 2010, meaning they had been in the workers’ compensation system for at least three years. Of those who said they strongly agreed that they might be fired because of their work injury, 21% weren’t working at the time of the interview. For those who strongly or somewhat disagreed, the number was 10%.

Further, the disability of those who strongly agreed lasted an average of 13 weeks, compared with nine weeks among those who disagreed that their injury might lead to being fired.

I can go on and on and on.

But here's the hypocrisy - while there is substantial, if not almost insurmountable evidence that taking care of an injured worker's head is critically important to desired workers' compensation outcomes, the claims community would rather not take on that can of worms.

And I can understand why - because insurance and claims management in particular isn't designed to do this; the actuaries didn't factor in the cost of correcting one's behavior and psychology when analyzing the cost of claims.

Nor did the business people that have the obligation of making money off of claims management factor that into their models; it's frankly cheaper to pay off a claim than to tackle the "long tail" of psychological therapy necessary to turn a person around. Indeed, that all may be for naught - there may never be a "turn around."

Because for all the rhetoric about an employer taking an employee as he or she is, and thus being responsible for whatever occurs on the job, there is very little ability to monitor, much less influence, one's psychological state.

So here's the deal - we can talk about mental health of a workers' compensation claim ad nauseum, but the business of workers' compensation is not about taking care of the whole person; it was designed only to take care of what happened specifically at work.

The best claims management can do with this information is be aware of the extent to which psychology plays a part in an injured worker's recovery and, if it looks like psychology is in the way of the desired outcome, then cut the claim chord off as quickly as possible.

It's a harsh reality, but that is the reality.

Kind of like when I told my wife that I finally decided on what new bike I needed to get after the motorcycle exposition - that part of the David-management system got cut off as quickly as possible.

Something about having one motorcycle is enough ...

Good Logic Applied

The California Supreme Court this week denied review of a case where logic was actually applied by the lower courts. Though unfortunate for the injured worker, the courts application of the law brought a rational result.

John Aresco had developed Guillian-Barre syndrome, a rare disorder in which the body's immune system attacks part of the peripheral nervous system, in 1998.

According to the National Institute of Neurological Disorders and Stroke, it affects about one person in 100,000, and its causes are unknown.

The Workers' Compensation Appeals Board had said that "the record was unclear how applicant was injured at work, and [had earlier] concluded regardless of whether the injury was caused by eating tainted food, picking up trash, or eating a berry given to him by a co-worker, none of these can be considered an "extraordinary" employment" within the meaning of Labor Code Section 3208.3(d).

Bowzer didn't think it smelled right...

Section 3208.3(d) bars compensation for psychiatric injuries for workers who have been employed for less than six months, unless it arises from a "sudden and extraordinary" event.

Since Aresco had not worked for his employer for at least six months before his fell ill, the "sudden and extraordinary" exception was his only hope of obtaining compensation for his alleged psyche injury.

But the board said it "is not the medical condition which must be extraordinary," rather, it is the employment condition causing the injury that must be "unusual, uncommon, or unexpected."

This finding resulted in a diminution of Aresco's permanent disability rating from 47% (if psyche were included) to 13% (with only internal injuries left).

Aresco appealed, but the 1st District Court of Appeal summarily denied writ in August. 

The Supreme Court then decided not to take up the matter, Aresco v. WCAB (Marine World Africa USA), No. S221011, at its case-review conference on Wednesday.

I'm all for injured workers getting the maximum amount of benefits due them under the law, and I don't fault Aresco's attorneys for pushing the limits - they're doing their job too.

But the law, as they say, is the law, and the Board and subsequent appellate courts have correctly interpreted the statute.

THAT might be an extraordinary (though not sudden) event.

Oh! To Be An Attorney!

Florida’s Office of the Judges of Compensation Claims will release its report to the state legislature in a few days as required by law. Chief Judge David Langham had primed the pump, so to speak, by blogging about initial findings on attorney fees in the state.

After his first report he discovered anomalies in the data which led him to investigate, and eventually correct the error. One of the reporting third party administrators had been using an incorrect query and consequently had erroneously inflated defense attorney expenditures by a few million dollars.

The corrected numbers are posted now on Judge Langham's blog.

The corrected numbers reflect that attorneys in Florida for fiscal 2012-13 were paid a combined total of $382 million; claimant attorneys got $142 million and defense attorneys about $240 million.

The total amount of fees being paid attorneys has been on the decline in the state since SB 50 had passed severely restricting claimant fees, and the assumption from participants in the system is that had a similar effect on defense fees.

In contrast, the California Workers' Compensation Insurance Rating Bureau last reported gross total attorney fees in California for 2012 was about $1.223 billion. Applicant attorneys got $450 million of that gross, and the defense was paid about $773 million.

Fees in California have been growing at about 8 % per year since just a couple years after Schwarzenegger's SB 899 sharply curtailed the benefits upon which most applicant attorney fees are based.

Indemnity claims in CA with an attorney are 78% of all claim costs. 

I was curious about how California stacked up against Florida - both states are known for being particularly litigious in workers' compensation.

A walk around the exhibit floor at the annual Workers' Compensation Institutes conference in August impresses one with all of the defense firm exhibits (and parties).

California lawyers on the other hand each have their own conferences, and even still defense firms will exhibit at some of the other employer or carrier based conferences in the state.

In contrast to FL, CA defense fees have continued to grow.

So while this is not a scientific study, and in fact I'm not even comparing apples to apples because the dates of the data collection are different, and there are other serious issues with this analysis that any competent high school statistician could tear apart, it is interesting nevertheless in terms of seeing where a big part of the money goes.

One comparison is just how big of a market are we really talking about.

For instance, California's gross written premium for 2013 according to the WCIRB was about $14.8 billion; the national gross written premium according to the National Council on Compensation Insurance was about $41.9 billion (includes state funds and private carriers).

So California represents about 35% of the total gross written premium of the entire nation.

According to NCCI's last report Florida's total gross written premium for 2013 is $3.21 billion, or 7.7% of national gross.

If we compare attorney fees as reported above to gross written premium, then for every premium dollar collected in California, twelve cents went to attorneys.

In Florida that ratio is 8.4 cents; a difference of about 30%. In other words, if you're going to be a lawyer in workers' compensation, California is about thirty percent more lucrative than Florida.

If we compare how much goes to defense representation as opposed to injured worker representation, the ratio is very close.

In California the ratio is 1.72. In other words for every applicant attorney dollar the defense spent a dollar and seventy two cents.

In Florida the ratio is 1.69; a very similar ratio.

Defense attorneys will defend (pun intended) their fees because work comp is "long tail" so they are working on cases that may be years old, or that they need to deal with issues that claimants don't such as resolving unsettled medical expenses.

Whatever - the point is that there is a lot of work available for attorneys, particularly defense attorneys, in workers' compensation. Just look at WorkCompCentral's job ads!

Sometimes I wonder if I should have stayed the course and remained a defense attorney instead of founding WorkCompCentral.

Nah....

Just The Way It Is

Anyone that doubts that workers' compensation is a "political compromise that obfuscates medical science to achieve a financial outcome" simply needs to read this morning's WorkCompCentral story about Illinois governor-elect Bruce Rauner, and the anticipated strategy the Republican plans to use workers' compensation as a bargaining chip to achieve other promised campaign goals.

Democrats hold about 60% of the vote in the Illinois legislature so whatever Rauner comes up with, to be successful, will need Democratic support.

And while Rauner never clearly outlined exactly what kind of reforms he had in mind during his election campaign, Michael Lucci, director of jobs and growth at the Illinois Policy Institute, noted for WorkCompCentral that Rauner said he would raise the minimum wage in the context of reform for workers’ comp and other tort liabilities.

“You can see that he is sort of framing a compromise there,” Lucci said.

Illinois went through a big reform of its system in 2011, but the state has been criticized for lagging in its execution resulting in a number seven ranking of the most expensive work comp states according to the last Oregon biennial study, although Illinois was ranked fourth in the nation when the last study was published in 2012 indicating some progress in shrinking costs, primarily by reducing medical treatment payments.

The pro-business lobby in the state is crowing that it's next border state, Indiana, has one of the lowest rankings in the Oregon study.

This of course, in my opinion, is a red herring argument - any business that says that it is moving to another state only because of workers' compensation evidences to me a management that doesn't know how to control its other costs since work comp is really a very small part of a business' overall expense budget; there's a lot more problems under the hood than just work comp.

Here's the political challenges facing any more tinkering with the Illinois system at this stage:

Otto Von Bismarck

1) Republicans and pro-business leaders want to change the causation standard to make it more difficult for workers to make a claim for benefits. Labor opposes this idea, and says that more insurance industry regulation is needed.

2) Illinois has gone through major changes to its comp system 3 times in the last 10 years - Rauner faces legislative fatigue on the issue.

3) Rauner is tying a promised minimum wage increase to $10 an hour to workers' compensation and tort reform, attempting to forge a compromise between Labor and Business in a face off where both sides must essentially come to the bargaining table in order to make any changes - Lucci says the members of the Illinois Workers' Compensation Commission must all sign off on any changes that are made to the policy, making some reforms harder to push through than others.

What's interesting about the minimum wage issue is that on Election Day, 67% of voters supported an advisory initiative to raise the state’s minimum wage to $10 an hour, reflecting Illinois' strong Blue roots.

Regardless, workers' compensation has always been a political compromise clearly dating back to the very first iteration introduced by Otto Von Bismarck in his 1884 Workers' Accident Insurance system.

I've said before that workers' compensation works as it is designed, but not as it is intended. That is because it is, always has been, and always will be, a political tool tied to unrelated social objectives of elected officials (or perhaps more often the objectives of those financing those politicians).

And that's just the way it is.

Vultures At Both Ends

Yesterday I espoused about our industry penchant to make a very simple proposition much more complex and difficult than necessary. We introduce all sorts of officious intermeddlers into the system and, I believe, that when we really get down to it anything that wrong with workers' compensation is our own doing.

Even on this own blog you are likely to run into advertisements like this one:

Would you click this ad?

Clicking on this ad will take your browser to http://workers-compensation-law.us where you will find "Free Workers' Compensation Help - Get your FREE, no-obligation evaluation today and find out how much your claim is worth."

This is obviously an attorney referral service, and frankly is probably against state bar rules in many states - but how can that be regulated effectively over the Internet and across the nation?

The website says that when you submit your information you are going to be contacted, and not necessarily by an attorney, but probably by a slick telephone sales person that will prey upon your work injury weakness and ensure that you are directed to one of their referral clients:

"By submitting your request, you grant permission for up to two of our premier partners to contact you using the phone number or email address that you have provided so we may assist you with your request for a free case evaluation and potentially an offer of representation and services. You agree that the matched partner may use an automatic telephone dialing system even if the number you provided is a wireless phone number. You understand that consent to being contacted is not a condition of purchase or acceptance of services of any kind."

Click around and you are taught that it's probably a good thing to get an attorney through this referral system:

"By law, you have the right to represent your own interests when filing a workers' compensation claim. You are not required to hire an attorney. However, because the process of filing a workers' compensation claim can be complex, many injured workers hire a legal professional or an attorney to advocate on their behalf. This is to ensure that they receive the maximum amount of compensation for which they are eligible."

The advertisement play hard on the adversarial nature of employer versus employee, I'm sure hooking every injured worker out for revenge:

"If you are an injured worker that has always worked hard for his or her employer, it may be difficult to accept that you can no longer work in the same capacity as you once did. Moreover, you may also have personal issues with receiving the assistance you need to sustain yourself. An attorney or legal professional can help to ease the burden and stress of dealing with the complex and bureaucratic process of receiving compensation. Furthermore, dealing with the complexities of the workers' compensation process as well as the emotional and physical strain of a debilitating injury is overwhelming for most people. An attorney advocates for you and eases many of the legal and emotional hassles so you can focus on recovery or rehabilitation.

"Insurance companies and state agencies are focused on giving you the smallest amount possible for your injury. They are professionals and deal with this system on a daily basis. Their experience and knowledge of the system is a tremendous asset in contested or difficult claims.

"If you are injured you deserve the maximum amount allowable in order to take care of yourself and your loved ones. A competent experienced attorney or legal professional will ensure that your claim receives the benefits you deserve."

The salacious solicitation goes on and on with predatory appeal to emotions surrounding entitlement mentality, insecurity, retribution and vengeance, and of course just plain greed.

BUT IS THAT ANY WORSE THAN THIS?

From a recent post on the WCC forums:

"I have found at least one major CA UR company is limiting 50 pages of medical documents allowed when appealing a UR denial. If more than 50 pages are sent, they call the claims adjuster and ask for approval to review more records. If the claims adjuster says no, then they stop reviewing records at page 50. There is nothing in the states rules and regulations that state such a limit. I did ask if they notify the person who sent the records, either the doctor, attorney or injured worker when they do not review all of the records. The answer I got from a UR supervisor was "no, the claims adjuster is our customer and we have to do what he says, if he does not want us to review more records or does not want us to review certain records we do not". I was advised to ask the claims adjuster about this as they only do what he states they can do."

ARE YOU KIDDING ME?

So let's drive the claimants to attorneys with nonsense like this. Limiting the quantity of records that are sent to utilization review is, in my mind, not only against the Labor Code and regulations concerning UR, but is both a sanctionable event via hearing before the Workers' Compensation Board (I know, claims LAUGH at penalty attempts now a days since they were essentially eviscerated by SB 899) and California Audit Unit (which as we have seen in prior posts is laughably meek as well).

It seems to me that this claims directive of randomly limiting the number of pages of records to 50 in order to save a couple scheckles is practicing medicine without a license. It's also behavior that intentionally deprives an injured worker of a fair review even if the UR company isn't also owned by the claims house or getting kickbacks, or some other nefarious financial interrelationship that is of questionable ethics.

“Analytics can give you a sense of which types of claims result in litigation, how much it can cost and can perhaps tell you how to alter the claim management so, again, there is less likelihood of it resulting in litigation,” Robert Hartwig of the Insurance Information Institute said in a story this morning in WorkCompCentral News.

Guess what folks, you don't need analytics. You just have to look at examples like the one above to understand what needs "alteration."

I've said it before and I'll say it again, and again, and again ...

THERE'S NOTHING BROKEN ABOUT WORKERS' COMPENSATION!!!

The only problem the system has is YOU.

Feed the system crap and you get crap.

Capitalists, Labor and Work Comp

An interesting realization came to me lecturing at the American Academy of Orthopedic Surgeons Workers' Compensation Course this past weekend - debating how to get the patient better, to return to work, to obtain the best outcomes medically, and all of the rest of the banter has nothing to do with making workers' compensation actually perform the way it was designed. These are doctors that really care about what they do in work comp and they get frustrated because they are scientists and linear thinkers, and they have a difficult time accepting areas of gray (e.g. "lighting up" a pre-existing condition).

I talk with a lot of them and, like many in the industry, they believe that workers' compensation is a broken system rife with fraud, dereliction and dysfunction.

The truth of the matter is that, while workers' compensation isn't the most efficient and functional system in the world, it has the ability to perform just fine if we allow it to. But it seems to me that in our quest to do the best job that each of us has been assigned, we forget the how and why of work comp.

It all comes down to understanding capitalism and its relationship to labor.

Capitalism is the act of gathering up money, investing money into a business idea and then hopefully getting a return on that money.

Labor provides the means by which capitalists are able to obtain a return on investment. Without labor, machines don't run, design doesn't occur, trenches don't get dug, trucks aren't driven. I use labor in the broad sense - each person that works provides a service, labor, that allows things to get produced and services to be provided.

And just as labor provides the means for capitalists to get a return on investment, capital provides a means by which labor is able to eek out a living - usually.

Don't confuse the capitalist with the employer - they are two different things. The employer is the mode by which deployment of capital occurs; the conduit by which money is managed through labor (and "hard" assets) to build the widget or provide the service.

While the economics of work comp are a bit more complex than this simplistic view, as long as the roles are understood it really is pretty simple.

First - employers do not pay work comp premiums. Employers collect work comp premiums from consumers of the services or products that are the product of capital and labor by adding the cost into the price of their product or service.

For the average employer, it is a zero sum game. For the employers that are really bad at managing their work environment it is a good deal more punitive. They may argue that work comp premiums drove them out of business but I'd guess they were really poor businessmen and there were a dozen other things that contributed to their demise.

I don't buy that workers' compensation in any state has ever driven business out of a state to another in and of itself. For the vast majority of businesses workers' compensation is tenths of a penny on the overall dollar. Workers' compensation may be a contributing factor, but it is not a reason in and of itself.

And I don't buy that workers' compensation drives business under ground. Contractors for instance have a whole host of employment related issues that influence under the table compensation to the workers, not the least of which is culture, which is tied to greed, which is the product of ... 

And I'm not going to discuss that work comp is a government mandated social contract here. We've covered that topic many times before. Suffice it to say, 'It exists - it is the Law' - just like traffic laws, tax laws, and environmental laws. I don't hold much hope that the legislators will figure out how to craft more laws to have an effective and fair system. They have been at it for 100 years and one could argue it's worse now than when it started.

Karl Marx' "Das Kapital" should be required reading for every economist, legislator, and business owner. His text clearly defines capital and labor in great detail. He states that without Labor, Capital is dead. Without Capital, Labor cannot subsist (at least not since the Hunter-Gathers 300,000 years ago).

The combination of Labor and Capital is designed to produce a Surplus (after the return of Capital and paying for the subsistence of Labor). Where we in America take issue with Marx' work is that he believed Surplus should be distributed to Labor. Obviously I, and most Americans, disagree.

A friend of mine did a study of the Fortune 500 - arguably the largest concentration of employers - a while ago to figure out this relationship between Capital, Labor and Surplus. Here's how the numbers break down: Before one employee can come to work (and run that drill press or whatever) some Capitalist has to put up $127,000 in capital. Of that amount, 57% is equity and the other 43% is borrowed.

At the end of the year, the employee has had guaranteed wages and (hopefully) some benefits. The Capitalist has, on average, earned around $2,400 per employee for his efforts. This compares to the average wage of $50,000 plus for the worker. Of course those numbers are generalizations and are a blend of some making much more and some losing a lot more.

Don't get me started on Management compensation. A) They are not the Capitalist, and; B) Their conduct and compensation has the implicit approval of those who are the Capitalist - not to mention the legal mandate to maximize the profits of the shareholders provided it is within the Law.

All these arguments about how the work comp system is broken and it is Corporate America's fault are nothing more than Red Herrings. The simple fact of the matter is that the behavior of people, and remember corporations are people (the United States Supreme Court told us so!) is what we have a problem with.

Whether that behavior is reasonable or not is balanced by what the Law says is reasonable, and when the Law doesn't tell us what is reasonable then we are left to our own ethics and morals.

Sometimes, as we all know, ethics and morals don't necessarily align; some folks have looser standards than others, some have tighter standards, and these are all tempered by what is demanded of each of us within all of our respective jobs.

It's time for us all to "Man Up" and take responsibility. The system isn't broken and it doesn't need to be fixed (God save us from another round of legislation designed to fix the system). Work comp is an Administrative system and it has rules and regulations. For the most part, those rules and regulations are designed to protect both the injured worker and the employer equally.

Is the clerk at Walmart slow and incompetent? Perhaps! But, that's where you go to buy things and despite the inconvenience or frustration you buck up and deal with it (at least my wife does - I get too frustrated to shop at Walmart...).

Is the clerk at the DMV slow and incompetent? Once again, perhaps! But, that's where you go to get your license and registration so you get in line, put up with the malarky, and get on with it!

I have never been able to make anything come about because I whined about it - in public or in private; vocally or in writing. The ONLY time I've ever been able to effectuate change is to just do it. We can all talk. We can all write. We can all do all sorts of things that don't accomplish anything.

Collectively, we can "Make Work Comp Work." Collect the premium or reserves. Pay the bills, and provide the treatment.

And we can do this without all of the phony baloney intermediaries that provide zero value to the basic equation of work comp: which is spreading the risk of financial ruin due to an occupational injury, be it employer or employee.

If you don't like the way the law works, if you don't like having to pay for an exacerbation of a pre-existing ailment, if you don't like restrictive medical treatment, if you don't like the increase in premium, there's a simple solution - immigrate to a nation where there are no such protections!

There's a reason why third world countries are, and remain, Third World - because Capital, Labor and the relationship between them are distorted.

As I tell the physicians that attend the AAOS course work time and time again, "workers' compensation is a political construct that obfuscates medical science to achieve a financial outcome."

Start telling that to anyone that will listen.

Have A Kick Ass Day

Dwight Johnson lost both legs in separate industrial accidents.

But when he was really down he thought of his seven children, his wife, and the rest of his life.

“I was laying in the hospital bed and I asked the nurse, I said ‘Give me the red button and leave it on; I’m done’,” Johnson told CBS News in an interview.

Johnson's job was inspecting skyscrapers. The first occupational injury was incurred on a trip to Hong Kong for work, when he developed a staph infection. Three days later, his foot was dead, and his only option was amputation.

After that first ordeal Johnson returned to work on high-rises with the use of a prosthetic leg.

“I basically had to learn how to walk all over again, like a child,” Johnson said. “All your balance, you learn your core, and where your balance is, and then you go from there.”

Round two occurred a year and a half ago when he was was struck by a transit bus while crossing the street in New York City, again on the job.

This put Johnson in a deep hole, and he initially refused to see a doctor because he knew amputation was imminent.

“We went through a couple nights where he wasn’t going to go, and I kind of had to give him an ultimatum that he had to go,” his wife Debbie says on the news report. “Otherwise, he would have died on me right in the house.”

“Something just told me I could do it,” Johnson said. “With the seven kids and my wife, I wasn’t ready.”

Dwight Johnson with his best "kick-ass" scowl!

Tom Nomura is Clinic Manager at Hanger, the Newport Beach company that created Dwight’s new legs and providing rehabilitation.

“He had to go through rehab each one of those times,” Nomura explained. “So it was his perseverance and his determination that really made it work for him.”

Johnson says he's in pain every day, takes medication all day long, but still says, "I'm not ready to sit in a chair."

Besides returning to the work force, Dwight and Debbie also began work with Amputee Empowerment Partners, to assist other amputees in their own transition into new routines.

Dwight's goal is to inspire amputees who remain in their chairs to work with their prosthetics.

“I meet a lot of people that are still sitting in their chairs, and they have prosthetics and they won’t put them on," he says. "So, I’m hoping this will entice somebody to get up off their rear and get up and go.”

Dwight's favorite sign off phrase is, "have a kick-ass day."

Dwight will be the motivational speaker at the 3rd Annual WorkCompCentral Awards and Gala on December 6.

Get your tickets now, they're going fast, and you will have a "kick-ass day."