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.