CA Injured Workers Face Stacked Deck During Workers’ Comp Appeals Process-Injured Nurse Co

CA Injured Workers Face Stacked Deck During Workers’ Comp Appeals Process-Injured Nurse Commits Suicide Due To Anti-Worker Program
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Injured Workers Face Stacked Deck During Workers’ Comp Appeals Process, Critics Say

Independent medical reviewers rarely overturn denials of treatment for injured workers, an analysis by the NBC Bay Area Investigative Unit has found.

By Liz Wagner, Michael Bott, and Jeremy Carroll


Many of California’s injured workers say they don’t have a fighting chance to recover under a workers’ compensation claim. The Investigative Unit is digging into a system that many patients and doctors say unfairly denies medical care, and examining an appeals process critics claim rubber-stamps denials of critical treatment. NBC Bay Area learned that nearly 90 percent of the time, anonymous reviewers agree injured workers don’t need the medical treatment their doctors have requested to get them back on the job. Sometimes it can lead to devastating consequences. Liz Wagner reports in a story that aired on Aug. 24, 2016. (Published Wednesday, Aug. 24, 2016)
This is Part III of an NBC Bay Area investigation into California’s workers’ compensation system. Click here to see Part I. Click here to see Part II.
Injured workers face an uphill, long-odds battle if they want to appeal the denial of medical care through California’s workers’ compensation system, state data shows.
Since reforms made in 2013 under Senate Bill 863, injured workers can no longer appeal treatment denials in front of a judge. Now, the state contracts with a private, for-profit corporation that reviews appeals under a process called “Independent Medical Review.” The company pays anonymous doctors, who have never examined the patient in person, to make those decisions based on a standard set of guidelines.
Patients don’t stand much of a chance under the new system, the data shows. Between 2013 and 2015, injured workers contested almost 600,000 denials of medical treatment. Those denials were upheld nearly 90 percent of the time when reviewed on appeal by independent medical review doctors.

What that number means, though, depends on who you ask.
Critics of the system point to that figure as evidence the appeals process is one sided -- simply rubberstamping the denial of treatment for injured workers. But those who say the system is working as intended have a different take. The fact that only one in every ten cases is overturned under appeal, they say, proves that correct treatment decisions are being made at each previous step in the process.
For Joan Dismuke, though, the debate is far more personal. A workplace injury in 2003 would mark the beginning of a long descent into chronic pain and depression for her daughter Lorrie Mays.
Mays would end up taking her own life in February, the same week Independent Medical Review upheld the denial of the only treatment Dismuke said brought her daughter any relief.
“I think everybody has a limit to what they can take,” Dismuke said. “[Workers’ comp] provided a lot of care for Lorrie. She just needed more.”
Mays was working as a nurse for the Fresno County Health Department helping women with at-risk pregnancies when she slipped on a flight of stairs during a house call. She went through surgery, but continued to have chronic pain in her legs and lower back.

Lorrie Mays
“Chronic pain is day in and day out,” Dismuke said. “And at some point, someone who develops chronic pain, which is unrelenting, develops depression.”
Workers’ compensation medical guidelines do in fact acknowledge a link between depression and chronic pain resulting from a work-related injury. It’s why anti-depressants can be prescribed by workers’ comp doctors. But for Mays, whose fun-loving personality would disappear after the injury, anti-depressants were ineffective.
So in 2014, her doctor turned to a treatment called Transcranial Magnetic Stimulation (TMS), a procedure used to treat depression in patients resistant to medication. Mays’ medical records show the treatment seemed to be effective.
But when her doctor requested another round of treatment in September, it was denied.
The denial stated the following: “The new criteria for proceeding with this treatment includes failure of multiple medications and failure of a trial of electroconvulsive therapy. The records do not clearly establish that the patient has recently failed a trial of electroconvulsive therapy. Further, the guidelines advise that a standard course of treatment includes 30 treatments. The patient has far exceeded this quantity.”
Mays appealed the denial, asking the state for an Independent Medical Review. In February, the doctor reviewing her appeal upheld the denial. Lorrie’s family was at the beach when she received the decision letter.
When Dismuke returned home, she found a note on the front door written by her daughter. It said to call the police – and not to go in the backyard.
“I knew instantly what it meant,” Dismuke said.
Dismuke would find other letters written by her daughter that spoke to the pain and frustration she endured trying to get the medical care she hoped would make her better.
“It’s been 12-plus years of hell,” Mays wrote. “The past several days have been so exhausting. I’m worn out, drained, depleted, gone.”
“We treat our employees while injured worse than we treat our veterans,” Mays wrote in another letter.
Mays’ case is extreme. But critics of the workers’ comp system say the implementation of independent medical review stacked the deck against injured workers.
A company called Maximus Federal Holdings won the contract to provide independent medical review for the state in 2013. The corporation is paid anywhere between $345 and $515 to review a case. It’s paid for by the injured worker’s employer or their employer’s insurance company.
The contract has been lucrative for Maximus. A study by the Workers’ Compensation Insurance Ratings Bureau found treatment denials are being appealed far more than expected.
“The number of IMRs filed in 2014 and 2015 was three times higher than initial WCIRB projections,” the report states.
Although Maximus received nearly 500,000 appeal requests over that time period, doctors employed by the company determined 90 percent of those requests were not medically necessary and upheld the original denials.

But who those doctors are is a controversy in itself. Their names are confidential and there is currently no requirement they have to be licensed to practice medicine in California. An analysis of state data found 39 percent of IMR doctors who reviewed cases in 2014 were licensed out of state. In 2015, 29 percent were out of state.
IMR doctors never actually examine the patient, either. Instead, they’re provided a slice of that worker’s medical history and make a determination using a standard set of guidelines.
“To have some anonymous person review your need for medical care and say you don’t need it – there’s zero transparency in that,” said Diane Worley, policy director for the California Applicants’ Attorneys Association.
Worley, whose organization advocates for injured workers, says the move to IMR was made to help contain costs, but the pendulum has swung too far.
“If the treatment the doctor is requesting isn’t the right treatment, the goal should be, ‘well, what is the right treatment?’” Worley said.
All that money going to Maximus, Worley said, means less money being spent on medical care for workers.
“The money that was going to treatment is now going to this bureaucratic nightmare of paper and review,” she said.
Maximus declined interview requests for this story, as did officials with the Department of Industrial Relations, the state agency that oversees workers’ comp.
But reports published by the insurance industry show the 2013 reforms have resulted in significant savings of nearly $800 million across the system. The WCIRB says those savings are beginning to translate into lower premiums for employers, which had been rising steadily for years.
And in July, a state report emphasized the continued need to make medical decisions based on evidence-based guidelines. By encouraging treatment that’s proven to work and discouraging treatment that’s ineffective, the report states fewer resources are wasted and injured workers get better care.
Dismuke, though, says those guidelines don’t fit every patient. They didn’t fit her daughter Lorrie, she said, and the consequences were devastating.
“It’s always bad to be the atypical patient,” Dismuke said. “I don’t care what field you’re in. If you present differently than the norm, you are liable to not get the treatment you need. I think here, she didn’t fit the profile of what they expected treatment to have to be.”


February 8, 2013
Is Maximus Paying $100 for Independent Medical Reviews?
https://www.workcompcentral.com/columns/show/id/cff1b25cd93737e0c8736ee5b3030f8cj
California's Independent Medical Review system is starting.

Workers with injuries after 1/1/13 will in most cases have to fight treatment denials by asking for Independent Medical Review. After 7/1/13, IMR will apply to pre-1/1/13 injuries.

Insurers or self-insured employers will pay the cost of IMR, which will be substantial.

Recently adopted DWC emergency regulation 9792.10.8(a)(1)(A)(i) specifies that the cost of a basic IMR to be done by Maximus, the IMR provider contracted with the Department of Industrial Relations, will be $560.

So it was of great interest when the issue of IMR came up in a panel at this weekend's winter CAAA convention in San Diego.

Past CAAA President Brad Chalk posed a question to Christine Baker, Director of the Department of Industrial Relations. Chalk noted that he had heard that some doctors had received notice that Maximus was hiring doctors to do IMR reviews.

Chalk noted that he had heard that doctors doing IMR reviews were going to be paid something in the range of $100. "Is that correct?" Chalk asked Baker.

Baker responded that she was not sure what Maximus pays the doctors doing reviews.

Baker essentially indicated that this was not a DIR/DWC concern since it is a contractual matter between Maximus and the doctor agreeing to do the reviews.

A moment later Baker came back to the point, noting that she will "look into it."

If Chalk's information is right, then we have a curious situation. Could Maximus be charging $560 for IMRs and paying doctors $100? If so (which is currently unconfirmed), this is quite an eye opener.

First, it would indicate a huge administrative "mark-up" by Maximus. Should employers be paying for that?

Second, how can California's DIR expect quality medical reviews if doctors are to be paid so little to do the reviews? If payments are that low it would seem extremely unlikely that a physician would bother to read contextual medical records to get an understanding of the worker's medical situation, what has been tried, what prior treatments did and didn't work and whether the requested treatment meets one of the hierarchy of standards specified under the Labor Code.

IMR will have little credibility if the doctors doing the reviews give short shrift to the process because they are paid so little.

After all, IMR reviews will not be appealable except for the most narrow grounds.

Ms. Baker needs to get on this issue immediately. The workers' comp community has a vital interest in understanding the cost structure behind the IMR system.

Julius Young is an applicants' attorney with the Boxer & Gerson law firm in Oakland. This column was reprinted with his permission from his Workers' Comp Zone blog.


MAXIMUS Launches Independent Medical and Bill Review Services for California Workers’ Compensation Programs
http://investor.maximus.com/press-release/corporate-announcements/maximus-launches-independent-medical-and-bill-review-services-
Contracts and Awards
Thursday, May 16, 2013 6:30 am EDT
RESTON, Va.
EmailPDFPrintRSS
NYSE:MMS
"We are drawing on our proven business processes and team of professionals to provide timely, independent reviews for California’s workers."
RESTON, Va.--(BUSINESS WIRE)--MAXIMUS (NYSE: MMS), a leading provider of government services worldwide, announced that it has launched operations under two separate two-year contracts with the California Division of Workers’ Compensation to provide independent medical review and independent bill review services. The combined value of both contracts is estimated to be up to $40 million over the two-year period.

Independent medical reviews are a cost effective non-judicial way to resolve disputes concerning the medical treatment of injured employees served by the California workers’ compensation system. If an injured worker’s physician’s request for medical treatment is delayed, denied or modified by a claims administrator for the reason that the treatment is not medically necessary, the injured employee may ask for an independent medical review of that decision.

Under the Independent Medical Review contract, MAXIMUS professionals will provide independent medical reviews of denied authorization requests or payments for medical services. These reviews are provided by an experienced team of independent professional staff, including nurses, doctors, physical therapists, health appeals specialists and other professional health clinicians. Under the Independent Bill Review contract the Company will provide review services for payment disputes between providers and claims administrators.

MAXIMUS is a leading provider of independent reviews of health care appeals for the Centers for Medicare & Medicaid Services (CMS), the Department of Veterans Affairs (VA), the U.S. Office of Personnel Management (OPM), as well as more than 44 state regulatory agencies nationwide. Since 1989, MAXIMUS has completed more than two million health care appeals on a timely basis and under rigorous quality control standards.

“This latest contract allows MAXIMUS to grow our independent review business while securing a foothold in a new, adjacent market, which is part of our larger strategy to extend our core capabilities to new programs and agencies,” commented MAXIMUS CEO Richard A. Montoni. “We are drawing on our proven business processes and team of professionals to provide timely, independent reviews for California’s workers.”

About MAXIMUS

MAXIMUS is a leading operator of government health and human services programs in the United States, United Kingdom, Canada, Australia and Saudi Arabia. The Company delivers business process services to improve the cost effectiveness, efficiency and quality of government-sponsored benefit programs, such as Medicaid, Medicare, Children's Health Insurance Program (CHIP), Health Insurance BC (British Columbia), as well as welfare-to-work and child support enforcement programs across the globe. The Company's primary customer base includes federal, provincial, state, county and municipal governments. Operating under its founding mission of Helping Government Serve the People®, MAXIMUS has approximately 8,800 employees worldwide. For more information, visit http://www.maximus.com.



MAXIMUS
Lisa Miles, 703-251-8637
lisamiles [at] maximus.com
or

SB 863: Landmark Workers’ Comp Reform to Support Injured Workers
Statement by California Labor Federation Executive Secretary-Treasurer Art Pulaski
http://www.calaborfed.org/index.php/site/page/sb_863_landmark_workers_comp_reform_to_support_injured_workers
"Finally, there’s a solution to the growing workers’ compensation crisis – a bill that provides a system-wide benefit increase of $860 million for injured workers, while reducing delays and friction that waste time and money.
"SB 863 is a landmark proposal that achieves a true rarity in Sacramento. It finds a way to increase benefits while reducing costs. After months of negotiations between labor and management, and a statewide listening tour hosted by the Department of Industrial Relations, a comprehensive reform deal was struck that benefits both workers and employers.
"Under this proposal, workers receive a 30 percent benefit increase. Those injured on the job will receive faster, higher quality medical treatment. Workers on permanent disability will receive a benefit increase and quicker payments of benefits. Dispute resolution is expedited, freeing up hundreds of millions of dollars that go straight to injured workers and their families. By cutting waste in the system, benefit increases were made possible while overall costs were reduced.
"Injured workers have suffered enough under Arnold Schwarzenegger’s draconian cutbacks to workers’ compensation. SB 863 puts more money in the pockets of injured workers while strengthening the system for years to come. Doing nothing is not an option. Under the current system, insurance costs are expected to rise by 18% in January. SB 863 is the right reform at a critical time.
"Opponents of SB 863, many of whom profit from the system, have engaged in a campaign of misinformation in an effort to protect the failed status quo. Not only are the reforms proposed in SB 863 necessary, they’re literally a lifeline for the system and the workers it benefits.
"SB 863 tackles the toughest challenges facing the workers’ compensation system head on, providing fresh hope to injured workers that have suffered for eight years under the failed reforms of the Schwarzenegger Administration. It’s time for real reform that puts injured workers first. We urge the legislature to pass SB 863 today, sending it to Gov. Brown for his signature."

CA AFL-CIO Pulaski And Wei Supported SB 863: Real Workers’ Comp Reform to Reduce Costs and Help Injured Workers
SB 863: Real Workers’ Comp Reform to Reduce Costs and Help Injured Workers
By Angie Wei, California Labor Federation
http://www.calaborfed.org/index.php/page/sb_863_real_workers_comp_reform_to_reduce_costs_and_help_injured_workers
Arnold Schwarzenegger rode into the Governor’s office in 2003 on the campaign promise to “fix” the workers’ compensation system. Every day in 2004, the media hammered home Schwarzenegger’s talking points that California’s highest-in-the-nation workers’ compensation costs were driving employers, and jobs, out of the state.
In the face of a relentless media campaign and the threat of an extreme workers’ comp reform ballot measure, the Legislature passed SB 899 in 2004—a draconian bill that gutted the workers’ compensation system and created more pain and suffering for injured workers.
Since SB 899, permanently disabled workers have seen their benefits slashed to the bone. Medical treatment is delayed and denied by insurance companies, sometimes for over a year. As a result, injured workers are stuck at home battling insurance companies for the medical care they need, with no ability to return to work.
After eight years of watching injured workers struggle with a slashed permanent disability schedule, we say, “Enough is enough.” Enough of injured workers stuck in a system where medical treatment is delayed and benefits aren’t enough. Enough of workers’ comp costs rising because of administrative costs – money going to claims administration and NOT going to injured workers.
The Schwarzenegger “reform” has failed both employers and workers. The system is still unstable and costs are rising across the board. Now is the time for real reform that protects workers, eliminates waste and reins in costs for workers and businesses. This year, representatives from both labor and management came together to fix the system before we face another workers’ comp crisis. Admittedly, labor and management don’t agree often on many issues. But both sides see the crisis facing workers’ comp, and want to get ahead of the impending disaster before employers and injured workers are crushed by rising costs and no path to increased benefits.
After hundreds of hours of negotiations, a team from labor and management, with the support of the Department of Industrial Relations, has developed a workers’ comp reform package that drastically improves the system, increasing benefits and instituting savings throughout the system.
We have an opportunity, in the next five days, to pass significant workers’ comp reform (SB 863) that would (1) add $740 million in NEW permanent disability money into the pockets of injured workers, (2) mitigate the delays injured workers face getting medical treatment, (3) deliver savings to the employers and (4) actually bend the rising cost curve of workers’ comp.
Not only is this reform proposal good for injured workers and for employers, but it is good for all of us in the union movement. How many times have we been at the bargaining table only to hear employers say they can’t afford a raise or benefit increase, or that they have to cut benefits for family coverage, because workers’ comp rates are bleeding them dry? How much have union members given up in wages and benefits because comp rates are skyrocketing?
Labor and management’s reform puts $740 million into the pockets of injured workers and helps them get timely, appropriate medical care. We have a governor who will sign the deal and employers who negotiated it.
Still, opposition from vendors who profit from the status quo is steep. The question we ask the opposition is this -- what are YOU going to do to get $740 million in new dollars for injured workers? What is YOUR plan to stop the delays and denials of medical treatment? How will YOU stave off double digit increases in workers’ comp costs? What are YOU going to do when union members are at the bargaining table fighting for wage increases and health care, when workers’ comp costs increases have eaten up the money on the table?
Finally... opponents to reform are saying this deal does too much, too fast, too late in the session. The Federation has been fighting to get more money to injured workers for eight years. This year, the Assembly Insurance Committee and the Senate Labor Committee held an informational hearing in March to tee up labor-management negotiations. The Department of Industrial Relations and the Division of Workers’ Compensation held a statewide listening tour to take input from all stakeholders in the system before negotiations started. Many of the medical reform provisions have been passed by the labor-management Commission on Health and Safety and Workers Compensation, through public testimony, written feedback, and public votes to adopt the research.
Why anyone is surprised about this effort is a surprise to us.
This negotiated deal is not perfect, we don’t profess it to be so. But that is the nature of negotiations – no one gets everything they want. Yet, we have a proposal that garners the support of both unions and employers, meeting the fundamental goals of getting more money to injured workers, bending the cost curve, and saving employers money.
There is no other path to getting $740 million back in benefits to injured workers. The Legislature must pass SB 863.

Posted on 08/27/2012 • Permalink

CA AFL-CIO Angie Wei Backs Anti-Injured Worker SB 863-Injured Workers Excluded From Secret Negotiations

SB 863: Real Workers’ Comp Reform to Reduce Costs and Help Injured Workers
By Angie Wei, California Labor Federation
http://www.calaborfed.org/index.php/page/sb_863_real_workers_comp_reform_to_reduce_costs_and_help_injured_workers
Arnold Schwarzenegger rode into the Governor’s office in 2004 on the campaign promise to “fix” the workers’ compensation system. Every day in 2004, the media hammered home Schwarzenegger’s talking points that California’s highest-in-the-nation workers’ compensation costs were driving employers, and jobs, out of the state.
In the face of a relentless media campaign and the threat of an extreme workers’ comp reform ballot measure, the Legislature passed SB 899 in 2004—a draconian bill that gutted the workers’ compensation system and created more pain and suffering for injured workers.
Since SB 899, permanently disabled workers have seen their benefits slashed to the bone. Medical treatment is delayed and denied by insurance companies, sometimes for over a year. As a result, injured workers are stuck at home battling insurance companies for the medical care they need, with no ability to return to work.
After eight years of watching injured workers struggle with a slashed permanent disability schedule, we say, “Enough is enough.” Enough of injured workers stuck in a system where medical treatment is delayed and benefits aren’t enough. Enough of workers’ comp costs rising because of administrative costs – money going to claims administration and NOT going to injured workers.
The Schwarzenegger “reform” has failed both employers and workers. The system is still unstable and costs are rising across the board. Now is the time for real reform that protects workers, eliminates waste and reins in costs for workers and businesses. This year, representatives from both labor and management came together to fix the system before we face another workers’ comp crisis. Admittedly, labor and management don’t agree often on many issues. But both sides see the crisis facing workers’ comp, and want to get ahead of the impending disaster before employers and injured workers are crushed by rising costs and no path to increased benefits.
After hundreds of hours of negotiations, a team from labor and management, with the support of the Department of Industrial Relations, has developed a workers’ comp reform package that drastically improves the system, increasing benefits and instituting savings throughout the system.
We have an opportunity, in the next five days, to pass significant workers’ comp reform (SB 863) that would (1) add $740 million in NEW permanent disability money into the pockets of injured workers, (2) mitigate the delays injured workers face getting medical treatment, (3) deliver savings to the employers and (4) actually bend the rising cost curve of workers’ comp.
Not only is this reform proposal good for injured workers and for employers, but it is good for all of us in the union movement. How many times have we been at the bargaining table only to hear employers say they can’t afford a raise or benefit increase, or that they have to cut benefits for family coverage, because workers’ comp rates are bleeding them dry? How much have union members given up in wages and benefits because comp rates are skyrocketing?
Labor and management’s reform puts $740 million into the pockets of injured workers and helps them get timely, appropriate medical care. We have a governor who will sign the deal and employers who negotiated it.
Still, opposition from vendors who profit from the status quo is steep. The question we ask the opposition is this -- what are YOU going to do to get $740 million in new dollars for injured workers? What is YOUR plan to stop the delays and denials of medical treatment? How will YOU stave off double digit increases in workers’ comp costs? What are YOU going to do when union members are at the bargaining table fighting for wage increases and health care, when workers’ comp costs increases have eaten up the money on the table?
Finally... opponents to reform are saying this deal does too much, too fast, too late in the session. The Federation has been fighting to get more money to injured workers for eight years. This year, the Assembly Insurance Committee and the Senate Labor Committee held an informational hearing in March to tee up labor-management negotiations. The Department of Industrial Relations and the Division of Workers’ Compensation held a statewide listening tour to take input from all stakeholders in the system before negotiations started. Many of the medical reform provisions have been passed by the labor-management Commission on Health and Safety and Workers Compensation, through public testimony, written feedback, and public votes to adopt the research.
Why anyone is surprised about this effort is a surprise to us.
This negotiated deal is not perfect, we don’t profess it to be so. But that is the nature of negotiations – no one gets everything they want. Yet, we have a proposal that garners the support of both unions and employers, meeting the fundamental goals of getting more money to injured workers, bending the cost curve, and saving employers money.
There is no other path to getting $740 million back in benefits to injured workers. The Legislature must pass SB 863

CA AFL-CIO Officials Conned By Gov Schwarzenegger "Labor movement neutral on the Schwarzenegger reforms"
"For the state labor federation, we like to consider ourselves as leaders in helping contain costs in worker’s compensation."
Angie Wei, Art Pulaski's Legislative Director

http://www.nasi.org/events/archive

Health and Income Security for Injured Workers:

Key Policy Issues


Thursday, October 12, 2006 - Friday, October 13, 2006


This policy symposium convened in the Ballroom of the National Press

Club, 529 14th Street, NW, Washington, DC.

Commentary

Angie Wei, Legislative Director, California Labor Federation, AFL-CIO



ANGIE WEI: Good morning. I’ve always wanted to say this. I want to thank the

academy for having me this morning. (Laughter.) I also want to acknowledge, off the

top, Christine Baker, the executive officer for the Commission on Health and Safety and

Worker’s Comp. Christine, in my opinion, is one of the hardest working and most

effective public servants in California, and I want to thank you for having me here. I

have to acknowledge, of course, Tom Rankin, a past president for the state labor

federation in California, who was the font of knowledge in representing workers and

injured workers in our state.



One of the things that Tom Rankin taught me as I started trying to pick up the

expertise he had in worker’s comp is that we have to be data-driven; too often anecdotes

drive our public policy. And anecdotes are very powerful, but what really should drive

our decisions and the positions that the state labor federation takes on legislation and

policies are the data, and that’s why I feel especially grateful to be here at the academy

and sit on the commission, because the data that you provide and the research that you do

really help illuminate the policy discussions in which we’re engaged.



I want to start by saying in California, we at the State Labor Federation really

believe in worker’s comp; maybe not in a lot of other issues. But in worker’s comp, the

employees and the employers do share the same goals for worker’s comp outcomes. We

think that these two parties are the two principals in a worker’s comp system. Everybody

else is a vendor. It doesn’t mean that they’re bad people. But let’s face it; they have a

financial interest in the system. So we want to do as much as we can to work with the

employer community because we do think that we have shared goals.



Bill and I worked hard this year to regulate and impose a fair fee schedule on

doctors dispensing prescription drugs, and after a good two years of hard work – why we

had to work so hard on such a clear issue is still kind of beyond me – we are going to get

to a point where we will have a fair fee schedule for doctor-dispensed prescription drugs.

Bill, I want to acknowledge also, was also critical on behalf of some employers to help us

maintain our own right for some of us in California to see our own doctors under the pre-

designation system. And while that right was supposed to sunset in April of ’07, we did

get Governor Schwarzenegger to assign a bill to extend that right to December of ’09.

And there are parts of the employer community who I think are reasonable who helped us

make that happen. And I want to acknowledge and thank him for that. Bill and I will

likely disagree from here on out on permanent disability. (Laughter.)



Two other final opening comments from me: we live in a term limited situation in

California and probably in a lot of your different legislatures, and on term limits, there is

a lot of churn, both at the legislator level as well as the staff level. We’ve lost

tremendous expertise in social insurance programs and in worker’s compensation. And

these new legislators come to town, they hear a lot about worker’s comp and they all

want to bang a home run with big changes in comp, based on anecdotes. And that’s why

55

we need the data to make rational and reasonable decisions, because we’ve lost so much

expertise in our state house, I believe, in social insurance programs.



For the state labor federation, we like to consider ourselves as leaders in helping

contain costs in worker’s compensation. I talked about vendors in the system. We have

all kinds of vendors who try and introduce bills to increase the reimbursement rates and

the fee schedules. You know, they provide durable medical equipment, specialty doctors,

pharmacists. You name them; we’ve got them – probably like you do in every other

state. And we try to be very consistent on the positions that we take on legislation that is

introduced by some of these stakeholders. It has to be data-driven. If you want change in

the system, if you want to justify a fee increase or change in your reimbursement rates,

show us the data for why it’s needed and then we’ll make an informed decision.



I think that there are certain employer trade associations that have big tents, and

represent a variety of interests, not just pure employer “I-pay-the-premium” interests.

They represent the insurers. They represent the durable medical equipment providers.

They represent the doctors. And so, in my opinion, some of these trade associations, like

the chamber of commerce, don’t take the right positions on these issues that drive up

costs. We want to stand in the way of cost drivers in the system because we want the

system to be fair and for employers to pay fair premiums, but we also know that as costs

go up, in the end it comes off our backs. As costs go up, the first place people often look

is at injured workers’ benefits and how to slash those benefits to retain costs. So we want

to play an important role to make sure that people are getting paid fairly – people, the

vendors – so that in the end, it tries to save the benefits of the injured workers and we

have to look beyond some of these employer trade associations. We’re lucky to have Bill

who represents an employer, a single employer, as opposed to some of the larger, big

umbrella, big tent, trade associations who may not have the best employer interests at

heart.



With that being said, I want to start talking a little bit about permanent disability.

And I’ll talk about the policy and about the politics. To put the permanent disability new

system that we have adopted in context – Frank started on this – we see in total about 65

percent cuts in total dollars in permanent disability, 5 percent from apportionment that

Frank described earlier; we’ve cut the number of weeks on the low end of the rating

system and that equates about 9 percent of the dollars in the system. We haven’t talked

anything about the zeros, those claims that don’t get rated under the AMA and fall out of

the system altogether. And that’s going to total about 15 percent of the total dollars in the

system. And then we have the actual permanent disability ratings schedule, which as

Frank closed his presentation, it’s about 50 percent cuts in total dollars.



Aggregate those four changes in permanent disability – I’m not a mathematician –

it adds up to something in the 70s for me, but Frank tells me it’s 65 percent cuts in dollars

because of cumulative impacts across the board or something. But if you take all those

factors into place, the total is 65 percent cuts in dollars in permanent disability.



56

The labor movement in California was neutral on the Schwarzenegger reforms

adopted in 2004. We would have never been neutral on a bill that would have taken 65

percent of the dollars out of the system. Governor Schwarzenegger and his negotiators

told us that they did not mean to cut benefits to the severely injured workers, to the

permanently disabled workers. And Schwarzenegger made those promises, and that’s

why we and Tom Rankin insisted that we write into the labor code statute, the reference

of the RAND study; if we base things on real, empirical data and wage loss data, we

would have a fair system. We recognize some benefits would go up and some benefits

would go down based on the type of injury. But we never anticipated a 65 percent cut in

the dollars in the system. And when the administration was putting together the new

rating system, they told us, oh, this will not end up in 50 percent cuts that you guys are

estimating. And I was taught to never say, I told you so; but on this one, we told them so.

We told them it would be 50 percent cuts, and actually we were right.



As we look at permanent disability, a couple of things that I was reminded

listening to Frank and Mr. Hunt. For us, return to work is the best outcome for injured

workers. That’s the way that we can get maximum wage replacement. We don’t support

keeping injured workers off the job. If they can and are ready and able to go back to

work, we think that is the best outcome for them.



Secondly, as Frank outlined in his presentation, and I’m remiss that I didn’t bring

a copy of it with me, the labor code was amended to take into account the RAND study.

We went to the AMA guys and we had adjustments – age, occupation, and this notion of

the future earnings capacity, the FEC factor. And that future earnings capacity was

supposed to be based on the empirical data of the RAND study and to do the crosswalk to

wage loss. The regulation that was adopted by this Schwarzenegger administration never

did that crosswalk, never tied it to the empirical wage loss data, and that’s why we see the

50 percent cuts in the rating schedule.



Let me say this: at the end of the legislative session, the president of our state

senate, Don Perata, moved a piece of legislation that would have increased the number of

weeks of benefits for permanently disabled injured workers. It was a bill that we

supported even though it might not have been, in our opinion, the best approach to restore

fairness in the permanent disability schedule. We saw it as increasing the number of

weeks for extremely low benefits. The better solution we would have liked was to

actually adjust the future earnings capacity. But we supported it. Partially why I think

our legislative leadership took that approach is because Stanley Zax of Zenith Insurance

Company supported this piece of legislation. He thought that if we restored and

increased the number of weeks for injured workers that the system could absorb that

amount, and maybe decreases in the employer premiums may have slowed down by less

than 5 percent. So we actually had an insurer support this legislation with respect to the

AMA guide with these adjustors for age, occupation, and the future earnings capacity,

because we agreed with the notion that we wanted a more consistent and more

predictable permanent disabilities system.



57

But with slashes in benefits this deep, I think we’re moving away from that stated

goal. We’re not going to get consistency and predictability because I think some of the

permanent disability raters themselves think that these cuts are too deep, and may be

trying to find ways to adjust them as much as they can. The lawyers who represent the

injured workers think that these cuts are too deep and are going to find every

methodological way to try and get the ratings increased. Some of the judges in the comp

system are going to think that these cuts are too deep and find ways to adjust upwards as

well. So while we try to get to the goal of consistency and predictability, having such

deep cuts in the system I think actually works against that goal.



I see the time clock ticking so let me just close in terms of the politics of the

situation. You know, Governor Schwarzenegger kind of pushed the legislature and all

the different stakeholders to a position of having to face this reform by kind of holding up

the threat of a ballot initiative over our heads. And he used that way to get to this deal.

And, I would argue that this was his only legislative success in the first two years of his

administration. Everything else failed; we killed everything else or it never got off the

ground. And so, to be able to tweak the permanent disability system meant that they

would have to admit that they made a mistake, and that’s a pretty uphill battle to push to

get the administration to admit that they made a mistake when he’s up for reelection.

And for us, it became his first promise broken. He promised not to cut benefits for

severely injured workers and clearly that has been broken. So Governor Schwarzenegger

is out on the campaign trail now touting his worker’s comp reforms in every commercial

and every piece of mail that they have. We, of course, are touting the 50 percent cuts in

permanent disability benefits as another reason why we should not send this guy back.

And in the end, injured workers are suffering.



Now, I understand that the administration’s division of worker’s comp is

undertaking some studies to try and tie wage loss to return to work rates to look at

whether or not in their opinion the permanent disability system needs to be tweaked. And

for us, the CHSWC commission in California has come up with a methodology that takes

baby steps to bring some justice back into the system and some fairness back into it. The

policy question in our minds is should we let injured workers suffer these deep cuts for as

long as it takes to do these studies or should we make minor adjustments on a regular

basis so that we can bring a little bit more relief to them? And we think that it’s

important to make the investment now and make these changes rather than wait for

however long it’s going to take to get these empirical studies done. I understand the

RAND study based on ten years of data. We don’t have time to wait. We can’t wait ten

years to try and restore some of these benefits. So we’ll come back next year, regardless

of who is in the governor’s office and try and do both regulatory and legislative work to

restore these benefits. Again, I thank the academy.

CA Workers' compensation deal faces fierce opposition-CA AFL-CIO Angie Wei Working With Bosses To Screw Injured Workers
Workers' compensation deal faces fierce opposition
http://www.latimes.com/business/money/la-fi-mo-comp-deal-faces-opposition-20120814,0,7244613.story



•

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Lawyers that represent injured workers are the most vocal opponents of a proposed $1-billion-plus overhaul of the California workers' compensation program. Above, workers' comp Judge Pamela Foust meets with a lawyer for an injured worker at Santa Monica court as other lawyers wait their turn, left. (Bob Chamberlain / Los Angeles Times /March 2, 2012)
By Marc Lifsher
August 14, 2012, 4:05 p.m.
SACRAMENTO -- A proposed overhaul of California's workers' compensation insurance is running into heavy resistance even before it's been formally introduced in the waning weeks of the legislative session.

A special hearing of the Senate Labor and Industrial Relations Committee scheduled for Wednesday at the state Capitol was postponed and no new date has been set.

As of Tuesday, the most vocal opposition to the $1-billion-plus deal is coming from lawyers that represent injured workers in California's specialized workers' compensation courts.

The lobbying group known as the California Applicants' Attorneys Assn. has issued an "urgent action alert" to its members, clients and allies "to contact your state senator or Assembly member now!"

The alert charges that the proposal, which has been worked out between labor unions and large employers, including Safeway Inc. and Walt Disney Co., is anti-worker.

"The measure gives insurance companies total control not only of medical care, but of all aspects of an injured workers' medical-legal case," the alert states.

A spokesman for Sen. Ted Lieu (D-Torrance) said that his office phone had been ringing continuously with complaining calls. Lieu, the chairman of the Senate committee whose meeting was postponed, is expected to carry the workers' compensation overhaul in his bill, SB 863.

Proponents of the overhaul counter that they carefully crafted legislation that would increase benefits paid to permanently disabled victims of on-the-job accidents by $720 million. Money for the boost would come from streamlining the system and by eliminating some payments made to doctors, lawyers, claims administrators and other service providers in the $11 billion-a-year workers' compensation system.

While the lawyers have aggressively attacked the proposed overhaul, other workers' compensation players are being more cautious about commenting before they've digested the 279-page bill.

"A lot of us are looking internally to see what we make of this," said Mark Webb, a vice president of Pacific Compensation Insurance Co. of Thousand Oaks.

The fierce reaction from the applicants' attorneys, he said, "has thrown everybody for a loop."

Nevertheless, Webb stressed that the deal is far from dead, and "proponents continue to meet in the Capitol with members to explain the value of their plan."



Deal on California workers' compensation overhaul appears likely-CA AFL-CIO Angie Wei Working To Screw CA Injured Workers
http://www.latimes.com/business/la-fi-workers-comp-overhaul-20120809,0,2165078.story

Unions and large employers are close to a deal to cut costs and hike benefits in the workers' compensation system. The Legislature could get the plan next week.


By Marc Lifsher, Los Angeles Times
August 9, 2012
SACRAMENTO — Hopes for a last-minute agreement to overhaul the state's $11-billion workers' compensation system are growing as the end of the 2012 legislative session approaches.

A small group of labor unions and large employers has been meeting quietly since April to craft legislation that would cut administrative, legal and medical costs enough to fund a significant boost in benefits paid to workers who suffer permanent disabilities from job-related injuries or illnesses. And an agreement seems imminent.

"We are very hopeful that we will be able to deliver to the Legislature a significant bill that both restores some modicum of justice to the injured worker and brings efficiency and less friction to the system," said Angie Wei, a key negotiator with the California Labor Federation of the AFL-CIO.

And in a prediction likely to please business interests, the labor leader said, "We think we can deliver real savings to the employers who pay the bills."

Senate Labor Committee Chairman Ted Lieu (D-Torrance), whose panel handles workers' compensation bills, is optimistic that something substantial can be achieved.

"I'm glad both sides are working together to hammer out an agreement that is fair for everyone," he said. "Preventing cost increases to employers and helping injured workers are vital goals."

The goal of the talks, which have been blessed by the administration of Gov. Jerry Brown, is to find a way to increase permanent disability benefits without raising insurance premiums paid by tens of thousands of small and large businesses and nonprofit organizations across the state.

Those rates have fallen about 60% since lawmakers and then Gov. Arnold Schwarzenegger in 2004 approved a landmark revision of California's workers' compensation laws. Sacramento lobbyists and state officials say they expect to see detailed provisions of the new overhaul when it's formally introduced in the Legislature early next week.

Quick action is considered essential because the annual legislative session adjourns Aug. 31, and lawmakers say they are ready to check it out.

The package is expected to be a priority partly because this is an election year, and the unusual alliance of big businesses and unions gives both groups, which hand out millions of dollars in campaign contributions, plenty of political clout.

The plan is being presented Thursday at a closed-door meeting called by the California Chamber of Commerce. Attending will be the employer representatives who negotiated the deal

Although the details are not public, representatives of employers have said they're open to providing more financial assistance to injured workers after eight years of support for a law that reduced their benefits.

Permanent disability benefits fell by more than half to an average of $12,000 per injured worker last year from $25,000 in 2004, according to a UC Berkeley Survey Research Center study.

Money to pay for the increase may be found by removing some of the frictions and inefficiencies from the system, said Martin Morgenstern, Brown's secretary of labor and workforce development, in an interview earlier this year. The administration is not commenting on the recent negotiations.

A 2009 analysis estimated potential savings of $793 million to $1.5 billion. Much of the funding could come from simplifying criteria for calculating benefits for various types of injuries.

Other savings, it suggested, could be achieved through changes in the fees paid to doctors and hospitals for outpatient surgeries and by cutting into a backlog of more than a half a million outstanding medical bills that have been piling up in the Los Angeles regional workers' compensation courts.

Such savings would give employers a sound basis for endorsing a hike in benefits to injured workers, said Jerry Azevedo, a spokesman for the Workers' Compensation Action Network, a coalition of businesses, nonprofit organizations and insurance companies.

"Employers would like to see a package that has verified cost savings that would be greater than the price tag" of any benefit increases, he said.

marc.lifsher [at] latimes.com

CA AFL-CIO Angie Wei Negotiating With Pols With Aim Of "Eliminating benefits for certain health conditions" for increase in permanent disability benefits

http://www.californiahealthline.org/articles/2012/8/15/unions-circulating-draft-of-bill-to-boost-workers-compensation-benefits.aspx#ixzz23lKAXZ7k

Wednesday, August 15, 2012
Unions Circulating Draft of Bill To Boost Workers' Compensation Benefits
Lobbyists for labor unions are circulating a summary of proposed legislation to increase workers' compensation benefits, the Sacramento Bee's "Capitol Alert" reports (Walters, "Capitol Alert," Sacramento Bee, 8/14).
On Wednesday, the Senate Industrial Relations Committee is scheduled to hold an informational hearing on language of the proposed bill (Johnson, Sacramento Business Journal, 8/14).
Background
Although there is less than a month left in the legislative session, California labor unions have pushed for the introduction of a bill that would increase workers' compensation payments to permanently injured workers and limit the fees that can be charged in processing claims.
Angie Wei -- a lobbyist with the California Labor Federation -- said that her group has been in talks with the chairs of the Senate Labor and Assembly Insurance committees about the issue and that unions and employers have been negotiating over workers' compensation for months (California Healthline, 8/9).
Details of Summary
According to a 45-point summary of proposed language, the bill would increase workers' compensation benefits by a total of about $700 million annually for individuals with permanent injuries ("Capitol Alert," Sacramento Bee, 8/14).
The legislation also would reduce costs in the workers' compensation system by a projected $1.2 billion to $1.4 billion (Sacramento Business Journal, 8/14).
The bill would cut costs by:

• Eliminating benefits for certain health conditions; and

• Scaling back considerations of future earning capacity while setting benefits.
The provisions detailed in the summary could be incorporated into a separate workers' compensation bill (SB 863) by Sen. Ted Lieu (D-Torrance), according to "Capitol Alert."
Reaction to Summary
The summary is drawing opposition from lawyers who specialize in workers' compensation cases. They argue that the bill is worse than workers' compensation reforms implemented by former Gov. Arnold Schwarzenegger (R), which the legislation seeks to undo.
According to "Capitol Alert," it is unknown how health care providers and health insurers would react to the bill ("Capitol Alert," Sacramento Bee, 8/14).

Injured Workers National Network IWNN Stands Against CA CHSWC Board's Attack on Injured Workers And In Opposition To CA AFL-CIO Support For SB 863
IWNN Opposes Secret Meetings By CA AFL-CIO Legislative Director Angie Wei and California AFL-CIO to "reform" Workers Compensation And Leaving Out Injured Workers Voices

The California legislator's Commission On Health and Safety and Workers Compensation CHSWC board has decided to make a deal with the California AFL-CIO top officials & the legislators to eliminate the third leg of the applicant (injured workers) attorneys. These attorneys were the professionals that the union referred their union members to! Now the unions are cutting of the third leg to help the state with employers to further harm injured workers!

Under this bill:

*This workers compensation package grants injured workers an illusory $720 million increase in permanent disability benefits while actually cutting benefits. It will reduce benefits for most injured workers in greater amounts than SB 899 did in 2004.

*It mandates the establishment of the Medicare Fee Schedule for workers’ compensation treatment and this will reduce injured workers’ access to specialty medical care, make it more difficult for injured workers to prove the cause and extent of their disabilities and increase employers’ insurance premiums.

*It permits employers to delay payments of permanent disability benefits and creates roadblocks that will discourage injured workers from returning to work.

*The proposed Independent Medical Review (IMR) system will further delay injured workers’ treatment, deny workers due process of law and will be very costly for employers. (See attachment for additional analysis.)

The state union leadership with Angie Wei, the AFL-CIO Legislative Director and also chairwoman of the CHSWC board has decided to collude with Governor Brown and corporations like Safeway Inc and Disney Corporation to sell out more benefits for injured workers, thus, omitting more money for applicant attorneys. Either way injured workers lose yet again as usual with the promise of more benefits, seldom seen by injured workers who suffer serious injuries and or illnesses caused by negligent employers.

http://www.latimes.com/business/money/la-fi-mo-california-comp-bill-difficulties-20120827,0,1832553.story



Angie Wei has publicly stated that she prioritize to bring "efficiency to the system" and "And in a prediction likely to please business interests, the labor leader said, "We think we can deliver real savings to the employers who pay the bills." Is this the way unions treat their own member by giving savings to employers who caused the injury or illness in the first place?

http://www.latimes.com/business/money/la-fi-mo-comp-deal-faces-opposition-20120814,0,7244613.story

California AFL-CIO leaders Angie Wei and Art Pulaski were also "neutral" on former Governor Schwarzenneger’s SB 899 which Wei now calls a “draconian bill”. At the time, they urged the labor movement not to take a stand against the anti-injured worker bill.

http://www.nasi.org/events/archive

http://www.calaborfed.org/index.php/page/sb_863_real_workers_comp_reform_to_reduce_costs_and_help_injured_workers

Christine Baker, the director of the California Department of Industrial Relations DIR has also publicly supported this new “reform” bill SB 863 and is seeking to push it throught the legislature. There have been no hearings by the Commission On Health and Safety and Workers Compensation on this proposed bill where all parties including injured workers would have the opportunity to speak out on the dangerous measures contained in this bill.

Furthermore not only are the Applicant Attorney’s Association representing workers compensation lawyers opposing the bill but the Voters Injured at Work organization VIAW is opposing this bill. In the past the California AFL-CIO supported this organization and said that they represented injured workers in California yet there are no injured workers organizations that are supporting this bill.

As always this is about takeaways in the California Workers' Compensation system with the promise of increasing benefits that seriously injured workers seldom see.

Why should injured workers give up certain injuries or illnesses to attain more permanent disability when this is already promised to them about a hundred years ago.. Every reform are in actuality benefits that are taken away from injured workers with the pseudo promise of increasing more benefits. Legislators now with the AFL-CIO have made a deal with the devil to deny more, There isn't much left for injured workers, nor was there ever going to be, as the politicians continue to erode what little benefits are left for the working class!

The Injured Worker National Network Stands for

*Elimination of ACOEM rules/guidelines

*Elimination of the Qualified Medical Examiner QME and the availability of doctor or your choice.

*Criminal felony penalties for fraud by insurance companies and employers for withholding required healthcare and terrorizing injured workers.

*Investigation of cost shifting by employers and the insurance industry and criminal fraud prosecution for such illegal activity.

California injured workers cannot afford another bill that punishes injured workers and covers up the fraud by corporations and the insurance industry who are once again attacking the injured workers of California

Please contact your union, Labor Council and the California AFL-CIO at (510)663-4000 and (916)444-3676x12 and and your California legislators and call for a no vote on California SB 863 (Lieu).

Also there will be a press conference at the September 6, 2012 meeting of the California Commission on Health And Safety and Workers Compensation CHSWC.

The press conference will be at 9:00 AM at 1515 Clay St. in Oakland California. The Commission hearing begins in the Auditorium at 10:00 AM

For more information call
Injured Workers National Network
IWNN

(415)282-1908

http://www.iwnn.org