It was smooth sailing at the legislature this week for Christine Baker and Rosa Moran.

Both easily won confirmation to their posts as head of the DIR and the DWC.

By all accounts, Moran and Baker work well together.

With reform efforts on the horizon, the political pressures on both will be substantial.

Each brings a unique background to the job of managing California's workers' comp programs. Baker has years of experience navigating workers' comp politics, dealing with stakeholder groups and policy wonks. Moran has extensive experience in the system from representing injured workers and serving as a workers' comp judge.

Congratulations to both.

Julius Young
www.boxerlaw.com
www.workerscompzone.com

The DWC listening tour is now over.

Yesterday I had a chance to catch one of the final sessions in Oakland.

It was interesting that the only specific mention of monetary savings I heard yesterday came from comments by SCIF's representative. SCIF claims that they project over a billion in achievable savings if certain changes are adopted.

By now it's clear that influential employer spokespeople are seeking to remove judges from making decisions about medical treatment. Apparently those stakeholders are unhappy with the current dispute resolution process.

But I'm not aware of any studies that show how this would generate savings.

And from the level of a practitioner, most treatment decisions are either dictated by UR physicians or by tie-breaker QMEs.

If numbers have been crunched on the savings that could be generated by other dispute resolution methods, I'm not aware of that. I don't believe that CHSWC has data on that issue at this time.

So this push may be philosophy driven rather than data driven.

Whatever. The push is on.

I'm told it is for some sort of IMR system. That's Independent Medical Review.

You'll likely be hearing a lot more about this. So to help you get up to speed, here is a link to a RAND report that analyzes different IMR models that could be used in California workers' comp (the HMO model, the Medicare model and the Texas workers' comp system model):
http://www.rand.org/content/dam/rand/pu ... ndixes.pdf

And here is a link to a study by the California Healthcare Foundation of the IMR program used with California healthcare plans:
http://www.chcf.org/~/media/MEDIA%20LIB ... istory.pdf

Stay tuned.

Julius Young
www.boxerlaw.com
www.workerscompzone.com

American culture has long touted the retirement years as "golden years".

The baby boomer generation in particular has nurtured the notion that "seventy is the new sixty". Living longer, getting cosmetic surgery, bringing our pop culture along with us as we age.

Mick Jagger and Neil Young are still rockin'.

But there is rising angst as Americans recognize that retirement security is, well...not so secure.

This is highlighted in the results of a March 2012 study by the Employee Benefits Research Institute, written by Ruth Helman, Craig Copeland and Jack VanDerhai, titled "The 2012 Retirement Confidence Survey: Job Insecurity, Debt Weigh on Retirement Confidence, Savings".

Here are the key finding of the EBRI paper:
-"Americans’ confidence in their ability to retire comfortably is stagnant at historically low levels. Just 14 percent are very confident they will have enough money to live comfortably in retirement (statistically equivalent to the low of 13 percent measured in 2011 and 2009)."
-"Employment insecurity looms large: Forty-two percent identify job uncertainty as the most pressing financial issue facing most Americans today."
- "Worker confidence about having enough money to pay for medical expenses and long-term care expenses in retirement remains well below their confidence levels for paying basic expenses."
-" Many workers report they have virtually no savings and investments. In total, 60 percent of workers report that the total value of their household’s savings and investments, excluding the value of their primary home and any defined benefit plans, is less than $25,000."
-"Twenty-five percent of workers in the 2012 Retirement Confidence Survey say the age at which they expect to retire has changed in the past year. In 1991, 11 percent of workers said they expected to retire after age 65, and by 2012 that has grown to 37 percent."
-"Regardless of those retirement age expectations, and consistent with prior RCS findings, half of current retirees surveyed say they left the work force unexpectedly due to health problems, disability, or changes at their employer, such as downsizing or closure."
-"Those already in retirement tend to express higher levels of confidence than current workers about several key financial aspects of retirement."
-"Retirees report they are significantly more reliant on Social Security as a major source of their retirement income than current workers expect to be.
 Although 56 percent of workers expect to receive benefits from a defined benefit plan in retirement, only 33 percent report that they and/or their spouse currently have such a benefit with a current or previous employer."
-" More than half of workers (56 percent) report they and/or their spouse have not tried to calculate how much money they will need to have saved by the time they retire so that they can live comfortably in retirement."
-"Only a minority of workers and retirees feel very comfortable using online technologies to perform various tasks related to financial management. Relatively few use mobile devices such as a smart phone or tablet to manage their finances, and just 10 percent say they are comfortable obtaining advice from financial professionals online."

The study noted that:
"One reason for the difference between workers’ expectations and retirees’ experience of retirement age is that many Americans find themselves retiring unexpectedly. The RCS has consistently found that a large percentage of retirees leave the work force earlier than planned (50 percent in 2012) (Figure 33). Many retirees who retired earlier than planned cite negative reasons for leaving the work force, including health problems or disability (51 percent); changes at their company, such as downsizing or closure (21 percent); and having to care for a spouse or another family member (19 percent). Others say changes in the skills required for their job (11 percent) or other work-related reasons (23 percent) played a role. Some retirees mention positive reasons for retiring early, such as being able to afford an earlier retirement (33 percent) or wanting to do something else (28 percent), but just 8 percent offer only positive reasons."

Many injured workers find themselves in the big group that retires dearly due to health problems or disability.

This is one reason why any changes to California's workers' comp system need to be crafted very carefully.

With credible studies showing a huge drop in permanent disability indemnity benefits paid to disabled workers since 2004, there are many California workers who are even less prepared for retirement than they would have otherwise been.

That's why it is important to carefully consider how a benefit increase is done. How will a benefit increase be distributed between lower end disabilities and disabilities of workers who cannot return to work?

If procedural hurdles are placed in front of workers, and impairment rating standards further tightened, will an "increase" be illusory? If disability percentages are assigned increased monetary amounts on a chart but percentages of disability awarded are compressed, how will this actually play out?

If the Almaraz-Guzman and Ogilvie cases were to be deep-sixed, how do we know that workers would not be that much further in the hole?

I have yet to see any reliable studies on these questions.

Legislators and the workers' compensation press are going to want to know more as further discussions between stakeholders proceed.

The statewide DWC listening tour has been great. Let's hope that some of the ideas that have emerged can be used in systemic changes.

But pretty soon the DWC leadership and stakeholder leaders need to start floating some of their ideas.

It's too important to emerge from a back room as a done deal at the end of the legislative session.

Here is a link to the employee benefits study. The study is replete with interesting charts and tables:
http://www.ebri.org/pdf/briefspdf/EBRI_ ... 9_RCS2.pdf

Julius Young
www.boxerlaw.com
www.workerscompzone.com

I recently settled a case that I'd handled for about eight years.

As I wrapped up some loose ends on the file, I printed out a log of "case activity".

The log was 33 pages long. There were about 800 activity entries. From the first meeting, filing the opening papers, to scanning in the settlement documents.

Entries of hundreds and hundreds of phone calls. Hundreds and hundreds of letters. Hundreds and hundreds of documents logged in or scanned.

And those are just the noteworthy calls, letters and documents. We wouldn't log or scan many of the random activities undertaken in the file.

I suspect the actual activity total was at least double if not triple.

Like a symphony played by an orchestra, there it was, laid out in the log. Notes from a receptionist, my secretary, my paralegal, our scheduler, and myself.

Responding to late checks, requests for advances, scheduling doctor appointments and depositions. Status discussions. Hand holding the applicant. Trying to explain why things happen. Explaining what may happen next. Taking information. Putting pieces of a puzzle together.
Putting out the "fires" which inevitably happen in cases.

In the workers' comp system, lawyers and judges get plenty of attention.

But in truth in many offices it is the staff that keeps the system running.

We're in the middle of what used to be "Secretaries Week", now commonly referred to as "Administrative Professionals Week".

Any office representing injured workers has a dedicated staff doing the sorts of things outlined above.

These are the workers who speak with the injured worker claimants, who hear the frustration and angst those workers voice. They are the folks who make many of the followup calls while the attorneys are in court and deposition.

It's not an easy job, but many of them do it year in and year out with aplomb. Many of them are incredibly dedicated.

They deserve our recognition and thanks. We couldn't do it without them.

Julius Young
www.workerscompzone.com
www.boxerlaw.com

Prime Healthcare is one of California's largest hospital chains.

Operating multiple California hospitals (all but one in Southern California), Prime was founded in 2001 by a cardiologist, Dr. Prem Reddy. According to Prime's website, among the facilities Prime Healthcare Services currently owns and operates are Desert Valley Hospital in Victorville, Chino Valley Medical Center in Chino, Montclair Hospital Medical Center in Montclair, Sherman Oaks Hospital and the Grossman Burn Center in Sherman oaks, West Anaheim Medical Center in Anaheim, Huntington Beach Hospital in Huntington Beach and La Palma Intercommunity Hospital in La Palma, California.

Several of these hospitals have been under attack in the press and by regulatory authorities for some time.

A 2007 Los Angeles Times article referenced allegations that the hospital pursued profits by cutting unprofitable patient care offerings and canceling insurance contracts.

Later there were allegations that the hospitals were upcoding billings and doing a lot of treatment for conditions such as septicemia that were claimed much more often at the chain's hospitals.

In late 2011 the FBI was said to be investigating Prime's billing practices for patient care of the elderly.

And more recently the chain has been accused of "trapping".

It appears that the "trapping" claims refer to an alleged policy of hanging on to patients who would otherwise be transferred to the hospital serving the patient's insurer network.

How is this said to work?

Here are a few paragraphs from a piece done by a reporter for California Watch, Christina Jewett:

"If a Kaiser Permanente customer ends up in the emergency room of another hospital, Dr. John Shohfi and his team of Kaiser doctors and nurses expect to be informed.

They're on call 24 hours a day, coordinating care when Kaiser patients are treated elsewhere.

But when Prime Healthcare Services took over a chain of Southern California hospitals, Shohfi testified today, there was a noticeable change in his relationship with Prime and its doctors.

“No calls,” said Shohfi, an emergency room physician. “They just stopped calling.”

Two health care providers, Kaiser and Heritage Provider Network, have accused Prime of "trapping" or "capturing" their patients in Prime emergency rooms and hospitals in order to charge more for treating patients from outside their medical networks."

Prime's policies were the subject of a February 24, 2012 legislative hearing.
As with many of the varied allegations about Prime's policies, the chain disputes any claims of wrongdoing and cites various awards the chain has received and the positive role of the hospitals in their communities.

But concern over these policies has led to a bill, SB 1285, carried by Ed Hernandez (D-West Covina). Hernandez is chair of the California Senate Health Committee.

It's easy to see how "capturing" could be a problem in workers' comp, if out-of-network hospitals hang on to patients, driving up billings.

Although I'm not aware of any studies that have been done on a workers' comp component to these alleged practices, focus on the issue may cause some workers' comp payers to look at how this affects them.

This controversy comes in the wake of concern about the role economic incentives may be distorting the provision of care in California, particularly in the Los Angeles area.

Here is a link to today's article in California Watch by Ms. Jewett that explores the background on SB 1285.
http://californiawatch.org/dailyreport/ ... ents-15818

It's pretty dry stuff, but for wonks out there, the current version of SB 1285 contains this description:
"Existing law provides for the licensure and regulation of health facilities by the State Department of Public Health and requires a licensed facility that maintains and operates an emergency department to provide emergency services and care to any person requesting the services or care for any condition in which the person is in danger of loss of life or serious injury or illness, as specified. Existing law requires hospitals to maintain a written policy regarding discount payments for financially qualified patients as well as a written charity care policy. Existing law requires a hospital to limit the expected payment for services it provides to certain low-income patients to the highest amount the hospital would expect to receive for providing services from a government-sponsored program of health benefits in which the hospital participates. Existing law, the Knox-Keene Health Care Service Plan Act of 1975, provides for the licensure and regulation of health care service plans by the Department of Managed Health Care and makes a willful violation of the act a crime. Existing law requires health care service plans, or their contracting medical providers, to reimburse providers for emergency services and care provided to its enrollees until the care results in stabilization of the enrollee.
This bill would require a hospital with an out-of-network emergency utilization rate of 50% or more to adjust its total billed charges for emergency services and care provided to a patient prior to stabilization to an amount no greater than the amount the hospital could expect to receive from Medicare for the services and care or, if there is no established payment amount by Medicare or if that amount is not sufficient to cover the actual cost to the hospital, an amount no greater than a good faith and reasonable estimate of the actual cost of providing the necessary services and care, as specified. The bill would specify that this provision does not apply to charges billed by emergency physicians, as defined, or to charges provided as treatment for an injury that is compensable for purposes of workers’ compensation. The bill would also specify that its provisions do not apply if any other law requires the hospital to limit expected payment for the emergency services and care to a lesser amount, if a contract governs the total billed charges for the emergency services and care, or if a government program of health benefits is the primary payer for the emergency services and care. The bill would require health care service plans or their contracting medical providers to reimburse hospitals in accordance with these provisions. Because a willful violation of that reimbursement requirement by a health care service plan or its contracting medical providers would be a crime, the bill would impose a state-mandated local program.
The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.
This bill would provide that no reimbursement is required by this act for a specified reason."

Stay tuned.

Julius Young
www.workerscompzone.com
www.boxerlaw.com