Sunday, July 31, 2011, 09:47 PM - Understanding the CA WC systemDid the City and County of San Francisco, defendant in the Ogilvie case, win the battle but lose the war?
It would appear so, as the opinion by the California Court of Appeal 1st District appears to allow a broader rebuttal of the PD schedule than that contemplated by the mathematical formula devised by the WCAB in its Ogilvie en banc decision.
No doubt in the coming days there will be a plethora of commentary on the Ogilvie decision from many distinguished comp attorneys.
From the tone of some of the e-blasts I've already seen, many in the defense industry believe the decision creates more problems than it solves. On the other hand, applicant attorneys are generally happy with the decision, though some I've talked to wish that the court had created a bright line methodology for rebutting the schedule.
Unless the cases is settled, we may well eventually see an Ogilvie III en banc from the board. That's because the 1st District remanded the case to the WCAB for further proceedings.
Of course it's possible that the California Supreme Court will eventually grant review. And here may be other cases in other appellate districts which reach different results.
So the fat lady has not yet sung.
But a number of things stand out in the opinion from the panel of Justices Siggins, Pollak and Jenkins.
The court finds "no meaningful difference" between "diminished future earning capacity" (the SB 899 standard) and "ability to compete in the open labor market" (the old standard).
The 1st District panel noted that the RAND study referenced in Labor Code 4660 considered earnings loss data
"categorized by descriptions used by the California Permanent Disability Rating System, while Senate Bill No. 899 requires injury descriptions based on the American Medical Association Guides...The descriptions are quite different in practice, and at the time the future earning capacity adjustments were established, there was no direct link between the data used by RAND and the American Medical Association Guides...An ideal system would combine information on earnings losses with actual American Medical Association Guide ratings."
As a result, the court concluded that
"A challenge to the ratings schedule on the basis that there was a factual error in the calculation of one of its component factors, or it was incorrectly applied in a particular case does not undermine the schedule's "consistency, uniformity, and objectivity" (4650, subd.(d).) It merely serves to correct it or ensure its accurate application".
The LeBoeuf doctrine continues to live. But the court notes that the cases limit LeBoeuf's application
..."to cases where the employee's diminished future earnings are directly attributable to the employee's work related injury, and not due to nonindustrial factors such as general economic conditions, illiteracy, proficiency to speak English, or an employee's lack of education."
Did someone say Hertz? Montana?
Hooking up the LeBoeuf and Brodie cases, the 1st District panel notes
"An employee effectively rebuts the scheduled rating when the employee will have a greater loss of future earnings than reflected in a rating because, due to the industrial injury, the employee is not amenable to rehabilitation."
In what my be the most significant portion of the opinion, the court notes that "in certain rare cases, it appears the amalgamation of data used to arrive at a diminished future earning capacity adjustment may not capture the severity or all of the medical complications of an employees' work injury".
It would appear the court is aware that for some injured workers, injuries do involve complications. Multiple impairments sometimes have a synergistic impairing result.
But rather than create a bright line formula for rebutting the schedule, the panel concludes that
"We leave it to the WCAB in the first instance to prescribe the exact method for such a recalculation that factors the employee's anticipated diminished earning capacity into the data used by the RAND institute".
That basically guarantees an Ogilvie III and a further appeal.
In the meanwhile, Ogilvie will intensify talks to revise the 2005 PDRS.
That's if the Brown Administration can devise cost savings to minimize any potential impact on workers' comp costs and the economy.
The 1st District Court clearly is sensitive to any efforts to rebut the schedule that reference other causes than the industrial injury. As a result, the court rejects the notion that for purposes of rebuttal "an employer takes the employee as he is". The court notes that
"Were we to hold that an employer takes the employee as he is and is therefore responsible for any loss of earning capacity the employee may have following an injury to matter the cause, we would create a strange disincentive for employers to extend opportunities for employment or advancement."
Returning Ogilvie's case to the WCAB, the court noted that "we cannot determine on this record the degree to which the experts may have taken impermissible factors into account in reaching their conclusions".
The ultimate financial and political impact of this decision are yet to be
Saturday, July 30, 2011, 10:37 AM - Political developmentsThe Potomac debt-limit drama continues, as cliffhanger politics play out with Obama, Boehner, Reid and McConnell.
Whatever your opinion of the Tea Partiers, the reality is that they have hijacked the process and the results of the debt and deficit debate.
It's amazing that we know so little about what hundreds of billions
(or over a trillion, depending on the final compromise) will be cut.
There's very little available analysis on how such large cuts would be distributed among specific programs.
Whatever the details, the impacts will be huge for California, as California receives over $75 billion each year from the Federal government. As Carolyn Lochhead notes in an article in the San Francisco Chronicle, "Debt Deal Could Devastate California Budget", "when the federal government sneezes, California catches a cold".
The California workers' comp system is basically user funded, so it's hard to see how budget cuts will directly affect the workers' comp system.
But other Department of Industrial Relations programs may not be so lucky. Cal-OSHA receives federal funding. And California's unemployment insurance fund, way in debt to the Feds anyway, may be affected.
Outside of the DIR, look for impacts on agencies such as EEOC, research funding, and Federal healthcare funding.
The point is that now we don't know much, but there will be collateral impact on services and programs available to workers in need of assistance.
The House GOP budget resolution unveiled earlier this year will not be the final template of a debt ceiling deal.Thus, the final debt deal impacts may be different. But it's instructive to look at an analysis of the 2011 House GOP resolution to see the kinds of cuts that may be in play. An analysis of projected impacts was done by the California Budget Project. Here's their April 2011 briefing paper, titled "House Budget Plan Would Force Deep Cuts and Make Radical Changes to Key Federal Programs":
To see the piece by Carolyn Lochhead, click here:
http://www.sfgate.com/cgi-bin/article.c ... &tsp=1
Friday, July 29, 2011, 02:03 PM - Political developmentsThe Ogilvie case has now been decided by the California Court of Appeals, 1st District.
The opinion acknowledges that the 2005 PD rating schedule is rebuttable but rejects a mathematical formula devised by the WCAB for doing so.
The 1st District did not decide the details on Ogilvie's case, remanding the matter to the Workers' Compensation Appeals Board for more condisderation.
Although the opinion appears to give little guidance regarding the specifics of how the schedule may be rebutted, it is notable that the court states:
"In certain rare cases, it appears the amalgamation of data used to arrive at a diminished future earning capacity adjustment may not capture the severity or all of the medical complications of an employee's work-related injury."
The court notes that:
"A scheduled rating may be rebutted when a claimant can demonstrate that the nature or severity of the claimant's injury is not captured within the sampling of disabled workers that was used to compute the adjustment factor".
Concluding, the court says that:
"Thus, we conclude that an employee may challenge the presumptive scheduled percentage of permanent disability prescribed to an injury by showing a factual error in the calculation of a factor in the rating formula or application of the formula, the omission of medical complications aggravating the employee's disability in preparation of the rating schedule, or by demonstrating that due to industrial injury the employee is not amenable to rehabilitation and therefore has suffered a greater loss of future earning capacity than reflected in the scheduled rating."
More on these developments later.
Meanwhile, you can access the opinion here:
http://www.courtinfo.ca.gov/opinions/do ... 126344.PDF
Friday, July 29, 2011, 08:01 AM - Political developmentsWorkers' comp heating up?
That's the thesis of a piece published today by Dan Walters in the Sacramento Bee. Walters notes a "burgeoning political debate" over the direction of the system.
According to Walters:
"Insurers have also complained about losing money on compensation, but Schwarzenegger and former Insurance Commissioner Steve Poizner opposed multiple efforts by the industry to sharply increase premiums.
The WCIRB's report says that during 2010, insurers' operating expenses, payments to injured workers and medical care outstripped premium income by $1.5 billion, lending credence to their pleas for premium boosts."
Walters observes "With Democrat Jerry Brown now governor, Democrat Dave Jones now insurance commissioner and Democrats controlling both legislative houses, there are new moves to effect change and put pressure on Brown to undo the much-criticized administrative rules."
Walters notes that "At the same time, however, business groups contend that raising employers' costs will impede recovery from recession and discourage rehiring the million-plus workers who have lost jobs.
Although California's workers' comp costs have dropped sharply since 2004, they're still fifth highest in the nation, according to an Oregon state agency's study, and a third higher than the national median."
Walters closes by noting "It's another issue, like the budget and water, that Brown finds familiar as he returns to the governorship after a 28-year absence. He tried and failed to overhaul workers' compensation during his first stint as governor."
It's a safe bet that Jerry Brown would be happy to never hear the two words "workers' compensation" again. So pieces from seasoned Capitol observers like Walters aren't welcome news for Brown.
Workers' comp may become a hot topic again, but for the moment Walters has probably overstated it.
It's likely that we'll see the Governor sign some of the less costly measures working their way through this year's legislative session. But major changes, including a new PD rating schedule, will require negotiations among the key stakeholders in order to achieve savings.
Here is a link to the complete Walters piece:
http://www.sacbee.com/2011/07/29/v-prin ... ation.html
Tuesday, July 26, 2011, 10:41 PM - Political developmentsSome people like to fool around with dummies.
Some are dummies.
Years ago I had a roommate who would put an inflatable doll in the passenger seat as he drove across the San Francisco Bay Bridge in the carpool lane. It worked for awhile, but he eventually paid a stiff price after being pulled over by the CHP.
Before that, one of my fellow college students pulled a similar trick, installing a mannequin in his seat during a college-required assembly.
But you'd think a doctor would know better than to pose as having performed work that wasn't performed.
That's what Los Angeles psychiatrist Kristine Eroshevich is now accused of having done. Eroshevich is said to have billed SCIF for work that was performed by others. Eroshevich has been in the public eye before in connection with her role as treater of Anna Nicole Smith.
The allegations-centered around misrepresentations in the QME process- are in a complaint filed against Eroshevich by the Medical Board of California. The complaint is viewable here:
http://documents.latimes.com/anna-nicol ... iscipline/