Monday, November 3, 2014

It's Not About Them

While SB 863's introduction of the controversial lien filing and activation fees has been credited with reducing the quantity of filings, law enforcement crackdowns on allegedly fraudulent vendor practices demonstrate how the lien culture in California work comp became so pervasive and caused this legislative reaction.

Dr. Douglas J. Abeles of Castro Valley was arrested on 31 felony charges for allegedly submitting bills for the review of drug test reports under the names of various providers who have said they did not submit the bills, were not aware they had been submitted and were never paid by Abeles.

A warrant filed Oct. 22 in the Alameda County Superior Court alleges that about 30,000 bills totaling $73,545 were sent to six carriers, including State Compensation Insurance Fund, Zenith Insurance Co., Berkshire Hathaway Homestate Cos., Liberty Mutual Insurance Co., Travelers and Fireman's Fund.

WorkCompCentral reporter Greg Jones queried the Electronic Adjudication Management System and found 417 claims totaling $994,520.15 from Abeles and his companies, Redwood Laboratory Management and Physicians RX Network.

The rapid rise in Abeles' and related entity lien filing volume shows how the culture in California promotes this excessive behavior.
From 2009 to 2011, 13 claims were filed under the name "Douglas Abeles" with a combined value of $111,630. Six claims were filed under the name "Redwood Laboratory Management" in 2011 and 2012 with a total value of $9,231.

The remaining 398 liens, with a total value of $873,658, are in the name of "Physicians RX Network."

The EAMS data also shows a dramatic escalation in lien filing that started in 2010 and peaked in 2011.

PRXN filed just 10 liens from 2000 to 2008, according to the EAMS data. The total value of these claims was $12,550. In 2009, PRXN filed 45 liens worth a combined $90,615, while Abeles filed a single claim for $11,569.
"It's not my fault, but it is my responsibility."

In 2010, when prosecutors allege the billing scheme started, PRXN and Abeles filed 153 liens for a combined $396,353. The next year, PRXN, Abeles and Redwood filed 202 claims seeking a total of $474,768.
At that point, the lien filings all but stopped. Redwood filed two claims for a combined $3,488 in 2012 and PRXN filed three claims for a combined $4,473, according to EAMS data.

It seems to me that the perception of little risk in getting caught because of the veil of "no fault," and the easy road to collections via an administrative dispute resolution system that recognizes vendor "rights," is a combination that is responsible for clogging the system.

We all have been saying for a long time that workers' compensation is "broken."

I disagree. Work comp isn't broken - the system will work as designed if we allow it to.

But it won't work as we "intend" it to - those of us that aren't "essential" to the grand compromise: i.e. employer, employee, and government - get in the way with OUR intent.

Doctors are necessary to render medical treatment, but the system isn't about them.

Attorneys are necessary for dispute resolution, but the system isn't about them.

Medical equipment and pharmaceutical vendors are necessary to supply requested treatment, but the system isn't about them.

Interpreters are necessary to assist non-English language workers understand, but the system isn't about them.
Insurance companies are necessary to spread the risk and ensure no single employer endures financial catastrophe, but the system isn't about them.

The system is about employers, workers, and the government is to stitch it all together to keep them honest.

It's no fault of the employer (with rare exception) that an employee gets hurt.

It's no fault of the employee (with rare exception) that he or she got hurt.

It is the responsibility of the rest of us (including the government) to keep it that way.


  1. So Mr. Depaolo, I have some one asking me what I think the fix would be for workers comp in WA State and across our country, his name is
    Pedro, Pedro Celis for Congress @

    Out of all the folks running for political office in our State He's the only one willing to talk openly on his FB page about workers comp. Here is what he asked me,

    Pedro Celis for Congress We appreciate your information on these issues, the question is, what is the solution? What can a member of congress do?

    Surely workman's comp is fraught with inefficiencies and corruption, especially the more the government is involved. The question is, given this information, what do you propose?

    We would love to help.


    Team Pedro
    Like · November 1 at 12:55pm

    Darren Fonzseau Thanks for responding and I am going to take a few to ponder the question and confer with others and get back to you ..... but thanks for responding that shows great character.
    Like · November 1 at 1:47pm

    Pedro Celis for Congress You are welcome Darren. We have seen your posts, but we have been unsure what exactly to say... so instead we asked you what your solutions are! We understand how frustrating it can be to have your 'servants' in congress ignore you and your concerns. That is why we decided to respond the next time you reached out. Even though we do not know exactly how to address the points you have raised, we wanted to make sure you knew that we want to help you as best we can.

    Thank you for being so active and involved!

    Team Pedro

    Kind of Cool hey, like Live Democracy on the net.

    Any way, if you could give us your thoughts, on what would be the FIX, for our comps system at this time.

    For if an executive like pedro and even my work manger at this time, both are asking me what I would do to fix comp? Then maybe folks are just really uneducated as to the facts.....

    So if you get a chance, could you please stop by Pedros FB page, and or through one of your article's, let this man, who is running for the US Senate, know what it is that needs to be done to fix things.

    I told him, I would get back to him, that I wanted to confer with the professionals out there in the world and get back to him, and then he agreed to keep his thread open so that others can pipe in and give their ideas as well, so that maybe we all might come up with some kind of UNIVERSAL solution. Hmmm ? Peace.

  2. It would be easier to keep an eye on one little theifdoom than having to police 50, that no one is really policing any more. any way Hmm?

  3. Time for DOJ to get involved, nationally. The more I do the more I see how common my story is. It's not broken. It's a mega billion dollar industry working as it is designed yo. Injured workers are just fodder. BUMMER. Commonly called fascism?? #WorkCompkills

  4. Dear Darren,

    In 1972 a commission was established to review each states workers compensations laws. This study provided advocates with data that did lead to changes in many states, where laws were inadequate for the injured worker.

    There was another bill proposed by California Senator Baca a few years ago, to have a similar commission. It unfortunately did not pass. This is one idea and I will provide what this bill proposed below.

    You can get involved politically and lobby for legislation in your state that helps injured workers. In my state, California we have an applicant attorney association which lists proposed legislation on their website. If you have not done so already, I suggest finding resources that would provide you with current workers compensation legislation in your state.

    Here is information to a bill that was proposed a few years ago, but unfortunately died.


  5. FEDERAL HR635

    A BILL To establish the National Commission on State Workers' Compensation Laws.

    Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

    This Act may be cited as the `National Commission on State Workers' Compensation Laws Act of 2009'.

    The Congress finds the following:
    (1) The full protection of American workers from job-related injury or death requires an adequate, prompt, and equitable system of workers' compensation as well as an effective program of occupational health and safety regulation.
    (2) The vast majority of American workers and their families are dependent on workers' compensation for their basic economic security in the event such workers suffer injury or death in the course of employment.

    (3) In 1972, the National Commission on State Workmen's Compensation Laws found that the system of State workers' compensation laws was `inequitable and inadequate'. Since that time, changes in reductions in State workers' compensation laws have increased the inadequacy and inequitable levels of workers' compensation benefits. Serious questions exist concerning the fairness and adequacy of present workers' compensation laws in light of the growth of the economy, changing nature of the labor force, misclassification of workers as independent contractors, and as leased employees, as well as erosion of remedies for the bad faith handling and delay in payment of benefits and medical care to workers and their families, increases in medical knowledge, changes in the hazards associated with various employment, new risks to health and safety created by new technology, and increases in the general level of wages and in the cost of living.


    There is established a commission to be known as the `National Commission on State Workers' Compensation Laws' (hereinafter in this Act referred to as the `Commission').


    (a) In General- The duties of the Commission shall be--

    (1) to review the findings of the previous National Commission on State Workmen's Compensation Laws and its recommendations;

    (2) to study and evaluate State workers' compensation laws in order to determine if such laws provide an adequate, prompt, and equitable system of compensation for injury or death arising out of or in the course of employment; and

    (3) to study and evaluate whether additional remedies should be recommended to ensure prompt and good faith payment of benefits and medical care to injured workers and their families.

  6. (b) Matters To Be Evaluated and Studied- The study and evaluation under subsection (a)(2) shall include--

    (1) the amount of permanent and temporary disability benefits and the criteria for determining the maximum limitations of such benefits or the elimination of such maximum limitations;
    (2) a study and evaluation of State workers' compensation laws in order to determine if, and ensure that, such laws provide an adequate, prompt, and equitable system of compensation and medical care for injuries or death arising out of in the course of employment;
    (3) a study of whether other adequate remedies are available to ensure the prompt payment of benefits and to reduce or eliminate bad faith delays in payments of benefits, providing medical care, and discouraging misclassification of workers as independent contractors and or leased employees to avoid paying workers' compensation benefits;
    (4) the amount and duration of medical benefits and provisions ensuring adequate medical care and free choice of physician;
    (5) rehabilitation;
    (6) standards for determining assurance of benefits caused by aggravation or acceleration of preexisting injuries or disease;
    (7) time limits on filing claims;
    (8) waiting periods;
    (9) compulsory or elective coverage;
    (10) administration;
    (11) ensuring prompt hearings and due process evidentiary rights in the resolution of claims;
    (12) the relationship between workers' compensation on the one hand, and old-age, disability, and survivors insurance and other types of insurance (public or private) on the other hand; and
    (13) methods of communicating the recommendations of the Commission.



    (a) Number and Appointment- The Commission shall be composed of 14 members, as follows:

    (1) 1 member, appointed by the President, who shall serve as chairman of the Commission.

    (2) 1 member, appointed by the majority leader of the Senate in consultation with the majority leader of the House of Representatives, who shall serve as vice chairman of the Commission.

    (3) 2 members appointed by the majority leader of the House of Representatives.

    (4) 2 members appointed by the minority leader of the House of Representatives.

    (5) 2 members appointed by the majority leader of the Senate.

    (6) 2 members appointed by the minority leader of the Senate.

    (7) The Secretary of Labor, the Secretary of Commerce, the Secretary of Health and Human Services, and the Secretary of Education shall be ex officio members of the Commission.

    (b) Affiliations-

    (1) Not more than 6 appointed members of the Commission shall be from the same political party.

    (2) There shall be at all times at least 3 members that represent injured workers, 3 members that represent insurance carriers or employers, and 1 member of the general public.

    (c) Qualifications- It is the sense of Congress that individuals appointed to the Commission should be United States citizens

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  9. So my reply to you Darren, on what can be done for all states is to have another commission, like the one that was formed in 1972 to review EVERY states workers compensation laws.

    The data that can be received from such a commission can be used as the starting point for injured worker advocates to then push for changes in their states laws.

    Anyone can lobby for legislation they believe in, and those who are passionate about their cause can be very effective.

    There is a forum connected to this blog that has of topic area for injured workers if you are interested in posting topics such as this.

  10. Thanks anon WC That's Awesome info... That I will use and share... Peace