Friday, May 27, 2016

Distrust Government

There are three stakeholders in workers' compensation: employers who pay for it; injured workers who benefit from it; and government which sets the rules and enforces them.

Or at least is supposed to.

We prosecute employers who commit fraud. Ditto for employees.

But at least the executive branch of the California state government seems to feel it is beyond reproach when it comes to opening its books for audit.

Assemblyman Tom Daly, D-Anaheim, had made a request for the state auditor to take a look at how the Department of Insurance and Division of Workers' Compensation work with prosecutors, insurers and employers to fight fraud.

But the governor's office didn't like the oversight request.
Sure you trust this guy?

According to sources who discussed the matter with WorkCompCentral on condition of anonymity, Gov Jerry Brown quashed Daly's efforts with considerable political pressure on Democratic members of the audit committee.

Daly’s May 2 audit request says lawmakers created tools to prevent or reduce unnecessary treatments for injured workers, but despite those tools, “there is ample evidence that the system remains rife with fraud and waste in connection with providing care, and related services to injured workers.”

Daly sought an explanation into how and to what extent state agencies, county prosecutors, self-insured employers and insurance companies worked together to fight workers’ compensation fraud.

Daly wanted to know how these entities coordinate anti-fraud efforts and the metrics used to measure progress in reducing fraud. He also wanted the auditor to investigate strategies used in other health care systems to prevent and prosecute fraud, as well as identify practices that may not be fraudulent, but that “result in the wasteful or abusive provision of services to injured workers.”

Staff members for the legislators on the audit committee who responded to reporter inquiries on Thursday said there was some support for the measure by both Democrats and Republicans.

But Brown's office, without explanation, did not want any review of the fraud-fighting apparatus, which is largely funded through assessments on employers and overseen by the Fraud Assessment Commission, the Department of Insurance and the DWC.

So Daly withdrew his request Wednesday depriving the Joint Legislative Audit Committee the opportunity to hear testimony or vote on whether to approve the audit.

Daly's office did not respond to reporter's inquiries either.

The industry talks about transparency all of the time and the chorus has been getting louder over the years. For example, it seemed that every presentation at the Self Insurance Institute of America's Workers' Compensation Executive Forum I just attended talked about the need for more transparency.

Employers want transparency because they pay for the system. 

Employees need transparency to know that they're getting what they should.

But the California government doesn't want transparency because it makes the rules, including the rules about enforcing its own rules...

Workers' compensation seems to be a system built on mistrust - and Brown's office wants to keep it that way.


On March 31, 2016, the news publication Reveal of The Center for Investigative Reporting published, "Profiteering masquerades as medical care for injured California workers." (Reveal has a whole series on work comp fraud and it is excellent and should be required reading for everyone in the industry, especially in California).

The most telling quote in that piece, which is completely validates by the notion that our government either has something to hide, or an embarrassment to protect, is by accused fraudster, owner of Landmark Medical Management, Kareem Ahmed who was caught on tape, according to the article, stating, "Nobody gives a fuck.”

Indeed, the article points out that "while health care programs such as Medicare have developed an arsenal of weapons to ward off fraud, California state regulators have few tools at their disposal. For one thing, the state shares oversight with hundreds of insurers and self-insured employers, leaving no one clearly in charge."

Perhaps it is THIS embarrassment that Brown intends to hide.

Partial remedy: mandate that ALL medical EOBs be shared with the patient, then reward patients for reporting activity that ends up either fraudulent or clearly erroneous. That is one simple tool that may cost carriers a little more, but could lighten the fraud assessment surcharge on employers considerably.

Hiding the ball by avoiding audits, however, is just plain wrong and the government needs to be called out on this bullshit.

The administration says it wants to deliver "evidence-based, appropriate and quickly delivered" medical care, but does nothing to avoid the opposite.

If mistrust is to be reversed, then we should not tolerate hypocrisy from our government officials.


  1. Great report David.

    It's interesting how one day, it's a Republican Governor in Kentucky working to stack the deck against injured workers, and the next day it's a Democratic Governor in CA not wanting to be transparent when it comes to fraud in the workers compensation industry.

    Politicians from both political party's not working in either the injured workers, nor the employers interest.

    Could it be that leaders from both parties have been influenced by a group named ALEC (The American Legislative Education Council)? For to hear the WILG lawyers tell us about it, this group has worked to stack the deck and influence law makers from both party's. To erode the grand bargain, harming employers and employee's in the process, while a few select groups seem to be profiting off the set up. As one of the lawyers from WILG have stated, this should offend folks, no matter what political party your from.

    You can hear a WILG lawyer, explain more about this subject and ALEC, here:

    What WILG Is Doing For Workers Compensation

    I agree with you that these leaders all seem to be either aiding in the abuse, or turning a blind eye to it. Yet, we need to move past pointing the finger at these bad leaders alone, and start to expose who it's their covering up for, and who is behind their efforts to basically erode the grand bargain, for a few to profit. IF we do not get to the root cause, of who is creating this bought out system, and expose those who are buying it out, and breeding the mistrust of our government to start with, then were doing nothing but pissing in the wind.

    When every one is pointing their fingers at every one ell's, but no one is pointing their fingers at the root cause, ALEC? It all just seems like a fruitless endeavor.For even if we expose the bad leaders, and get them out eventually, ALEC just puts in new ones, that have the same bad behaviors.

    Please take the time to hear what the WILG lawyers are saying about ALEC, and share with us all that side of the story. For the whole story can not be told, with out folks learning about the root cause, and group behind it all, ALEC. As well as the legislative lobbying war they have declared on injured workers, and our employers, grand bargain. An injury to one, is an injury to all, no matter how big, or small. Just saying, as always. Peace

  2. David,

    Thank you for this article. I know from personal experience that insurance carriers, law firms, medical providers are all committing crimes against injured workers... but more to the point, I have sought out help from many in the State of CA including Governor Jerry Brown's office, law enforcement, the DA's office, Senators, Representatives and many more, on several occasions > to not only report the many crimes beset against me alone but to have those who are committing crimes against me and likely other injured workers prosecuted. Crimes that include the heinous and intentional systematic maiming of my body, intrusions into my home, stolen medical history and workers comp related documentation, tainting of my food and refreshments, phones tapped, e-mails hacked, car vandalized several times, computer attacked with malware and viruses, even the Judge at the WCAB participating in what I view as corrupt acts during my WC trial, noise campaigns where I currently, interference in my healthcare outside of workers comp, documents falsified including medical reports and surgery reports, the insurance carrier to this day, still refusing to provide me with a copy of the audio taped interview that I began asking for back in January 2014, copies of documents that I completed for medical providers - denied to me and much more.
    I have no doubt that there are those who are working within State and local government who are aiding and abetting if not participating in the crimes that injured workers endure.
    Thanks against David, for this article. I hope that the future of workers compensation improves for the sake of injured workers, however, if our own elect and government paid officials are just as corrupt, there is little hope of that.