California's Workers' Compensation Appeals Board has rendered an em banc decision on medical treatment and MPNs.

The case, Elayne Valdez v. Warehouse Demo Services, is likely to have a significant impact on the California workers' comp system.

In Valdez, there may have been a valid MPN. I say may, because the WCAB decision defers a determination on that issue, but analyzes the case on the assumption that there was probably a valid medical network.

For those of you late to the party, employers and insurers can set up networks, forcing workers who do not have a valid predesignation on file to treat with a doctor on the network.

Around the state, different patterns of workers' comp practice exist.

In Southern California workers and attorneys have often sought to regain
"medical control", finding technicalities to allow the worker to escape the MPN network and treat elsewhere. With a large number of doctors willing to provide such treatment, often on a lien, workers would sometimes treat off-network.

In Northern California this is seen much less frequently, probably because there is not a large pool of non-MPN physicians willing to "treat on a lien".

In Valdez, Ms. Valdez treated with an MPN doctor for about three weeks.
At that point, she apparently was referred to a non-MPN doctor by her attorney.

Valdez did not attempt to change doctors within the MPN. Nor did she invoke the infrequently used procedure to seek a formal "second opinion".

Nevertheless, at trial level the Workers' Comp Judge based an award of temporary total disability on the opinion of the non-MPN physician, Dr. Nario.

In deciding the case, a majority of the WCAB commissioners (Joseph Miller, James C. Cuneo, Deidra E. Lowe and Alfonso J. Moresi, with separate concurring and dissenting opinions from Frank M.Brass and Ronnie G. Caplane) take a hard line.

Where unauthorized treatment is obtained outside a validly established and properly noticed MPN, reports from the non-MPN doctors are inadmissible, and may not be relied on.

In a blow to the economic model of many of the non-MPN providers, the Valdez case indicates that the employer and insurer are not liable for the cost of non-MPN reports.

To reach this result, the majority makes several key points.

First, they note that workers can change doctors within the MPN and can invoke a multi-level appeal process within the MPN.

Second, they note that Labor Code 4061 and 4062 are QME process remedies where a party disputes determinations regarding medical treatment and diagnosis issues.

Third, they distinguish Labor Code Section 4605 and 5703(a) sections which appear to allow workers access to consulting or attending physicians at the worker's expense.

In a direct retort to Caplane's dissent, the majority notes that
"It is those applicants who have chosen to disregard a validly established and properly noticed MPN, despite the many options to change treating physicians and challenge diagnosis or treatment determinations within the MPN, and to dispute temporary or permanent disability opinions under sections 4061 and 4062 outside the MPN, who have removed themselves from the benefits provide by the Labor Code."

I'll be providing further analysis and reaction to this decision in a post in the next few days. Stay tuned.

Meanwhile, here is a pdf version of Valdez vs. Warehouse Services (2011):
http://www.dir.ca.gov/wcab/EnBancdecisi ... aldezE.pdf

Julius Young
www.workerscompzone.com
www.boxerlaw.com
www.thecompguys.org

Although worker fraud busts are sexier, employer fraud is probably costlier.

Studies have shown that employer workers' comp fraud in California is huge, as employers either misclassify employees or go without insurance altogether. This unfairly burdens honest employers, who then are at a competitive disadvantage.

Prior posts on this were "It's the Employer Fraud, Stupid" Part One:
http://www.workerscompzone.com/index.ph ... 670342ae49

And a later post, "It's the Employer Fraud, Stupid" Part Two:
http://www.workerscompzone.com/index.ph ... 818-110358

Now the legislature is poised to tighten some loopholes regarding sofflaw contractors.

A bill carried by Democratic Assemblyman Bill Monning, AB 397, would require employers to provide proof of workers' comp insurance when renewing contractor licenses with the Contractors State Licensing Board.

Although this would not solve the problem of unlicensed contractors, it would likely cut down on workers' comp fraud by licensed contractors.

Here is the current proposed text of the bill:
"SECTION 1. Section 7125.5 is added to the Business and 2 Professions Code, to read: 3 7125.5. (a) At the time of renewal, all active licensees with an exemption for workers’ compensation insurance on file with the board, submitted pursuant to subdivision (b) of Section 7125, shall either recertify the licensee’s exemption by completing a recertification statement on the license renewal form, as provided by the board, or shall provide a current and valid Certificate of Workers’ Compensation Insurance or Certificate of Self-Insurance,
whichever is applicable. (b) The license shall not be renewed unless a licensee with an 1exemption for workers’ compensation insurance on file with the board recertifies the exemption status or provides a current and valid Certificate of Workers’ Compensation Insurance or Certificate of Self-Insurance in conjunction with the license renewal. (c) If the documentation required by subdivision is not provided with the license renewal but is received within 30 days after notification by the board of the renewal rejection, the registrar shall grant a retroactive renewal pursuant to Section 7141.5 back to the date of the postmark of the otherwise acceptable renewal. A renewal that is still incomplete for any reason after 30 days after notification of rejection shall not be eligible for retroactive renewal under this subdivision.

Co-authored by Republican Tom Berryhill, the bill appears likely to make it to the Governor's desk later this year.

Here is the Assembly legislative analysis of the bill:
"1)Rationale . This bill, sponsored by the Contractors State
License Board (CSLB), is intended to create a system for the
board to maintain a list of active workers compensation
exemptions. Under current law, a licensee could have an
exemption certification on file for years without needing to
confirm that the exemption is still an accurate representation
of the licensee's status. This bill requires licensees to
recertify their exemptions each time their licenses are
renewed."

" 2)Background . The CSLB within the Department of Consumer Affairs
(DCA) licenses and regulates more than 300,000 contractors
under the Contractors State License Law.

All licensed contractors must carry workers' compensation
insurance and file proof of coverage with the CSLB unless they
receive an exemption. A contractor who has no employees and
has filed a statement with the CSLB certifying that he or she
has no employees and does not hold a C-39 roofing
classification license is exempt from carrying workers
compensation insurance."

This is another good bill which deserves bipartisan support.

Stay tuned.

Julius Young
www.workerscompzone.com
www.boxerlaw.com
www.thecompguys.org

In the Capitol yesterday in Sacramento a number of workers' comp bills advanced out of committee.

In my last post I included links to the text of many of these bills.

Advancing were these:

AB 211 (Cedillo)
This bill, which would make changes in the supplemental job displacement voucher, advanced on a bipartisan 10-0 vote.

AB 584 (Fong)
This bill, which would require some UR to be done by California licensees, passed from Assembly Insurance on a party line 8-4 vote.

AB 1155 (Alejo)
This bill, to ban discrimination in apportionment, prevailed in committee, again along a party line vote.
Here is a link to how the vote tallied:
http://www.leginfo.ca.gov/pub/11-12/bil ... _comm.html

AB 378 (Solorio)
This measure, to tighten up pricing on compounded drugs, made it from Assembly Insurance on a 9-0 vote.

AB 1168 (Pan)
Also sailing through on a 9-0 vote, this bill would set a fee schedule for vocational expert testimony.

SB 432 (DeLeon)
The hotel industry opposes this bill, which would set some standards for the safety of hotel housekeepers. But the bill passed on a 5-2 vote from Senate Labor and Industrial Relations.
Voting no were Republicans Wyland and Runner.

SB 826 (Leno)
There was more agreement on this one. The measure would set some penalties for administrators who fail to comply with data reporting requirements. The bipartisan vote was 6-0.

With the legislature consumed with the issue of the budget, it is unlikely we will see any major legislation arise in California workers' comp this year.

Brown's policy team on workers' comp is still not publicly set yet.

While rumors swirl around about who is out and who is in consideration for Administrative Director of the Department of Industrial Relations, it would appear that only a handful of key players really know.

If even they know.

Stay tuned.

Julius Young
www.workerscompzone.com
www.boxerlaw.com
www.thecompguys.org

Up for consideration in committees today at the California Senate and California Assembly were a number of workers' comp bills.

I'll be noting the progress (or lack thereof) of many of these bills as the session progresses.

Meanwhile, here are links to the text of the more important bills themselves:

AB 1155 (Luis Alejo, D-Watsonville)
This bill is a replay of previously passed anti-workers' comp discrimination bills that were vetoed by Governor Schwarzenegger:

http://www.leginfo.ca.gov/pub/11-12/bil ... oduced.pdf

AB 1168 (Richard Pan, D-Sacramento)
This bill would establish a fee schedule for voc rehab expert testimony in workers' comp. This concept could be important if the Ogilvie case survives appeals and there is more litigation attempting to rebut the PD rating schedule.
http://www.leginfo.ca.gov/pub/11-12/bil ... oduced.pdf

AB 378 (Jose Solorio, D-Anaheim)
This bill would create some pricing limits on compounded drugs and their ingredients. The increasing use and cost of compounded drugs and
nutriceuticals has been an increasing concern in the system. A recent study by RAND for CHSWC outlined many of the concerns in this area.

http://www.leginfo.ca.gov/pub/11-12/bil ... sm_v98.pdf

AB 335 (Jose Solorio, D-Anaheim)
This bill would require benefit notices to contain plain language rather than legalese. A CHSWC study identified notices as one area that could result in system cost savings. Designing notices is not as easy a project as one might think, however, though a worthy goal it be.

http://www.leginfo.ca.gov/pub/11-12/bil ... oduced.pdf

AB 211 (Cedillo, D-Los Angeles)
This bill would lower the potential amount of the retraining voucher but provide for easier access to the voucher. Delays in accessing the retraining voucher has hobbled many workers since negotiators struck a deal in 2004 that resulted in the end of workers' compensation retraining benefits.

http://www.leginfo.ca.gov/pub/11-12/bil ... oduced.pdf

SB 432 (Kevin DeLeon, D-Los Angeles)
This bill would assist hotel housekeepers by regulating some of the workplaces. Long handled scrubbers and fitted sheets would be required.

http://www.leginfo.ca.gov/pub/11-12/bil ... oduced.pdf

SB 826 (Mark Leno, D-San Francisco)
This bill would put some relatively small penalties in place where insurers failed to comply with required data reporting requirements

http://www.leginfo.ca.gov/pub/11-12/bil ... oduced.pdf

Few of these bills appear likely to show up on the CalChamber's "Job Killer" list. For the most part these are bills designed to make small changes in the system, or head off potential abuse.

Many of them will probably advance.

In coming posts I'll update you on where things stand.

Stay tuned.

Julius Young
www.workerscompzone.com
www.boxerlaw.com
www.thecompguys.org

The last decade has been a hard one at Cal-OSHA.

With an administration that was often hesitant about stepping forward on occupational health and safety matters, and with a pro-employer majority on the OSHA Appeals Board, Cal-OSHA has been withering.

Inspectors are spread thin, and I'm told that staff morale has been very low.

Federal concern about California's program has been increasing. And there's been increasing media focus on concerns that Cal-OSHA's mission is not being fulfilled:
http://www.workerscompzone.com/index.ph ... 122-103155

As of January 2011 California had only 196 OSHA field compliance inspectors for the whole state. 14 positions were vacant. Federal OSHA funding would authorize up to 235 inspectors.

Since California has a workforce of around 16 million workers as of December 2010, this means that 196 inspectors were tasked with enforcing occupational safety and health laws at an approximate ratio of one inspector per 93,000 workers.

This ratio compares very unfavorably to inspection ratios in other states:
- Average of all states (2006): 1 inspector per 66,354 workers
-Average of states with their own OSHA plan (2006) 1 per 50,166
-Nevada (2006): 1 inspector per 33,706 workers
-Oregon (2006): 1 inspector per 22,239
-Washington (2006): 1 inspector per 26,902
-British Columbia (2006): 1 inspector per 10, 564

By comparison, California has more fish and game wardens than occupational health and safety inspectors

Things may be poised for a turnaround, however.

In a good appointment, Governor Brown has appointed Ellen Widess to be chief of Cal-OSHA (the Division of Occupational Safety and Health). That's one of the sisters to the Division of Workers' Compensation under the umbrella of the department of Industrial relations, now to be headed by Christine Baker.

Widess is well known and well liked in California labor and occupational health circles. She has taught Environmental Law and Policy, Occupational Health Law and Toxic Torts at the University of California, Berkeley and the University of Texas Law School. Widess was Chief of CalOSHA’s Pesticide Program and Director of the Pesticide Program for the Texas Department of Agriculture. She has also been a Director of Health Policy for Children's Advocacy Institute and Executive Director of Lead Safe.

Finding revenue streams to address the poor inspector to worker ratio will be difficult in California's current budgetary environment. It's not clear what might be proposed to address that problem.

But the administrative change at Cal-OSHA will also be leveraged new Brown appointments to the Cal-OSHA appeals board.

Brown has announced the appointment of Ed Lowry and Art Carter to the Cal-OSHA appeals board. Carter, already on the board since 2009, will move into the position of chair. Carter's bio includes a stint as the deputy chief administrative officer for the city of San Francisco and from 1976 to 1983 as the chief of the Division of Occupational Safety and Health Administration for the Department of Industrial Relations. Carter was the secretary-treasurer for the Contra Costa County Central Labor Council from 1967 to 1976.

The Cal-OSHA appeals board sets the tone for enforcement. It's time to use a firm hand with scofflaw employers who cut corners, ignoring health and safety laws. Under Carter's leadership we'll likely see some progress on that.

Those of us in the comp community know well what happens when safety and health regulations are ignored. Workers from those workplaces often wind up in our offices. It's that simple.

Stay tuned. Interested in getting an RSS feed to the blog? Click on the buttons on the lower right corner column.

Julius Young
www.workerscompzone.com
www.boxerlaw.com
www.thecompguys.org