The Medicare Secondary Payer Statute: In Search of Ariadne’s Thread

In Greek mythology, Daedalus built the Labyrinth for King Minos of Knossos to contain the awful half bull/half man Minotaur. Theseus eventually killed the Minotaur, but only found his way out of the Labyrinth because Ariadne had given him a magic thread to mark his way in and out of the maze. I’m beginning to think that American health care makes the Labyrinth look like an easy walk across Boston Common on a sunny day. And, so far at least, no one seems to have found the magic thread.

Workers’ compensation medical care is now getting whipsawed by two powerful and unstoppable forces: the Medicare Secondary Payer Statute (MSP) and the inexorable aging of the baby boomer generation.

We’ve written about these two looming catastrophes in the past. Seventy-eight million baby boomers are hard to ignore, and the MSP issue is starting to remind me of the 1958 horror movie, The Blob , wherein a gelatinous creature grew gargantuan by eating everything in its path. Two things have already occurred in the new year that bode well for continued growth of the MSP Blob.

The insurance industry goes a-begging
Last week the American Insurance Association, the National Association of Mutual Insurance Companies and the Self-Insurance Institute of America wrote to the Department of Health and Human Services Secretary Kathleen Sibelius asking her to delay the 1 April 2010 implementation of MSP mandatory reporting requirements. You can find the reporting requirements here.

The new regs lay a heavy burden on the comp insurance industry, referred to in the regs as Responsible Reporting Entities (RREs). (Such unfortunate acronyms bring me back, alas, to my days in the military.) RREs must report to the Centers for Medicare and Medicaid Services (CMS) any workers’ compensation claims that involve ongoing medical payments, with the exception of most medical only claims. In their letter, the organizations list five reasons they believe an implementation delay is necessary. The first items are all about process: security protection, a lack of guidance from the CMS and an insufficient period for testing the proposed reporting procedures. The fifth reason, which is really the first reason, is the economic big stick which, when deadlines are missed, will slap fines of up to $1,000 per day per claim upside the heads of RREs. Ouch!

There’s a lot more to it, and we’ll be writing more about it in the coming months, but for now it’s enough to know that the insurance industry is on its collective knees asking for a delay in the implementation of reporting requirements that have already been delayed and extended once.

Inedible Maryland Crabcake?
The second thing affecting MSP that happened in the new year may or may not turn out to be a big deal. On 4 January 2010, the Maryland Workers’ Compensation Commission issued emergency regulations that require CMS approval for all workers’ compensation settlements, not just the ones that meet the review thresholds in the CMS User Guide, version 2.0. The commission is requiring CMS review of virtually every claim up for settlement.

The new procedures require that every settlement pass through CMS before the Commission will approve it. Here is an excerpt from Maryland’s emergency regulations:

A settlement that falls within the Medicare thresholds must be approved by CMS before it will be approved by the Commission.

A settlement the falls outside the Medicare thresholds may be approved by the Commission provided that the settlement agreement:

1. Contains a statement confirming that the interests of Medicare have been considered in reaching the settlement; and

2. Identifies the amount of the proposed settlement:

a. Apportioned to future medical expenses;or

b. Set-aside for future medical expenses through a formal set-aside allocation

3. The apportionment of the amount of the settlement associated with future medical expenses shall be supported by medical evidence such as a medical opinion or evaluation.

While it remains to be seen if the Commission’s action will significantly delay settlements or increase costs in Maryland, it's reasonable to assume that it will. As any workers’ compensation professional knows, the longer a claim stays open, the more it costs. As a result, the Maryland approach to Medicare set asides is not a good candidate for replication in other states.

A Magic Thread
As I write this, I’m about to leave for San Antonio for the 2010 Health and Productivity Forum, sponsored by the Integrated Benefits Institute and the National Business Coalition on Health. I’ll be participating in a panel discussion organized and led by Broadspire’s Gary Anderberg, one of the smartest people I know. Our panel will be addressing workers’ compensation medical care and costs and the effect health care reform may have on both. I sure hope that Gary has brought a few spools of Ariadne’s thread. We're going to need some magic to guide us through this formidable labyrinth.

Posted by Tom Lynch at 10:25 AM Link to, Comment (1), or E-mail this post

Health Wonk Review and other news briefs

Get the latest scoop from the health policy blogosphere at this week's excellent "Health Wonk Review - so what do we do now?" edition. Joe Paduda at Managed Care Matters is our most capable host this week. Kudos to Joe, who is the visionary and founder of Health Wonk Review, a biweekly compendium of best posts from more than 80 participating health policy bloggers, journalists, and organizations. It's been a particularly useful guidepost to the health care reform efforts.

Happy birthday to RIMS - RIMS is celebrating its 60th anniversary as an organization this year. You can look back at the 60 year-history in the current issue of Risk Management, which now is available in digital editions. The current January/February issue also includes articles on the the soft property/casualty market continuing in 2010, a multi-generational perspective on communication, steps to avoid when investigating an employee for fraud, and steps to reduce stress.

Mea culpa, medical style - What happens when doctors who err say they are sorry to their patients? Kevin O'Reilly examines the issues surrounding medical disclosure and apologies when things go wrong in an article in American Medical News. Thirty-five states have laws offering some kind of legal protection for physicians who express regret or empathy to patients who experience an adverse event, and some hospitals that have adopted "I'm sorry" policies have experienced drops in both the numbers and costs of claims. But in looking at some of the legal issues, some attorneys counsel caution. Thanks to David Harlow of HealthBlawg for pointing us to this interesting article, in which he is quoted.

Social networking - At the LinkedIn Workers' Compensation Forum, there have been some lively discussions this week . One on an Illinois Supreme Court ruling which found that an employer is liable for continued TTD benefits to an employee who was accommodated on light duty and terminated for cause, and another on proposed Colorado legislation that would put limits on an employer's ability to spy on employees in workers' comp cases.

Preventing retail fatalities - There has been a decade-long drop in the number of retail workers who died as a result of workplace violence - from 286 in 1998 to 167 in 2007. Of that number, nearly half were employed in late-night establishments: 39 in convenience stores, 32 in gas stations, and 7 in liquor stores. OSHA has updated its guidance for prevention: Recommendations for Workplace Violence Prevention Programs in Late-Night Retail Establishments.

Manufacturing declines - At Comp Time, Roberto Ceniceros looks at the the steep downward slope of manufacturing jobs in California and in the nation, and raises the question of this decline's long term impact on workers comp premium production and services.

Workplace wellness - The Health Affairs blog recently featured a pair of posts on workplace wellness programs. Jaan Sidorov makes the case for why wellness incentives belong in the workplace. In response, Alec Balch examines more issues surrounding incentives: whether financial rewards and penalties should be tied to an employee's coinsurance premiums, and to what extent incentives should be based on the employees ability to meet certain health standards vs wellness program participation.

Regulatory forecast - A rundown of the U.S. Department of Labor’s (DOL) regulatory agenda for 2010 is available on Human Resources News. There's a strong emphasis on safety. Thanks to HRhero for the pointer.

Case law - Featured on the LexisNexis Workers' Compensation Law Center - The Top 10 Bizarre Workers’ Comp Cases for 2009 makes for a fascinating read.

Bad employee of the month - we offer our nominee. She will just have to try harder if she wants to earn a slot in the Insurance Fraud Hall of Shame - the class of 2009 features some rather egregious offenders.

Toyota: Hands Off!

Toyota, the world's largest automaker, is in the midst of a public relations nightmare. Over two million vehicles have been recalled for a problem with acceleration: gas pedals are prone to sticking, which leads to unstoppable cars hurtling along at high speeds. For months, Toyota denied that there was a problem. Well, there is no denying it now. U.S. Transportation Secretary Ray Lahood has advised owners of the vehicles not to drive them. [Update: he is backpedaling from his statement.]That's over two million people who are not supposed to drive for the foreseeable future. With all due respect, Mr. Secretary, in this culture where the automobile is less a luxury than an essential, what are these millions of drivers supposed to do?

For the sake of clarity, here are the specific vehicles with a pedal problem:

2007-10 Camry
2009-10 RAV4
2009-10 Corolla
2009-10 Matrix
2005-10 Avalon
2010 Highlander
2007-10 Tundra
2008-10 Sequoia
2004-09 Prius
2007-10 Tacoma
2009-10 Venza

We frequently blog the compelling issue of personal risk management: the myriad decisions we all make in mitigating risk and prolonging the chances of living to see another day. Well, we have here a crisis of huge proportions that confronts Toyota drivers with some very difficult decisions. In keeping with our usual mandate, we will try to focus primarily, but not exclusively, on the implications for workers comp.

At the head of the line are companies that operate Toyota fleets, or that have employees operating Toyotas leased by the employer. At this moment there are irrevocably immense liabilities in allowing employees to continue to drive the vehicles listed above. Of course, the usual "to and fro" issues prevail in determining whether employees injured in an accident are covered by workers comp. (Astute readers will recall that in California, anyone driving a company car is covered by comp 24/7.) But even where comp should be the "exclusive remedy," employers are vulnerable to suits alleging "wilful intent" should they insist that Toyota drivers stay behind the wheel. Prudent risk managers will rent alternative vehicles until the Toyotas have been repaired.

For employees driving their own Toyotas, the "to and fro" rule prevails. However, what happens when an employee is "in the course and scope" of employment and gas pedal lock leads to an accident? Will the employer be held liable for the injuries to third parties? Should employers prohibit employees from driving the compromised Toyotas while working? If yes, how are these employees supposed to do their jobs? Who pays for the replacement vehicles?

Secretary Lahood has accelerated the risks associated with the Toyota recall. He has put the nation on notice than any use of the above vehicles entails unreasonable risk.

This all brings to mind a Toyota ad campaign from an earlier decade. The slogan was: "Get your hands on a Toyota. You'll never let go." I remember thinking at the time that there was a gruesome ambiguity to the wording. The image of a dead driver behind the wheel of a crushed vehicle rose up in my (admittedly hyper-active) imagination. Well, that slogan has come back to haunt the automotive giant. This is no time to put your hands on the wheel of a Toyota. Until this immanent hazard is addressed, it's definitely time to let go.

Addendum:
We just noticed that Renaissance Alliance's Consumer Insurance Blog has a post on what to do if you experience sudden acceleration - it includes a video and some tips from Consumer Reports - whether you own a Toyota or not, it's a good safety skill to learn

Twitter feeds we recommend

For workers' comp news and other links in between blog posts, we encourage you to follow @workcompinsider on Twitter. If you aren't yet on Twitter, you may want to think about it. Even if you aren't ready to engage, it can be a great way to follow industry buzz. You may already be following many blogs and news sources through RSS (syndicated) feeds via news readers - we do, too. But Twitter feeds add diversity and immediacy as well as the potential for engagement. You don't have to have messages fed to your mobile devices, you can choose to follow folks on your Twitter home page or via a service like TweetDeck.

Here are just a few of the interesting Twitter feeds that we follow - most are insurance- or work-related:

@AIADC - The American Insurance Association "represents approximately 350 major insurance companies that provide all lines of property and casualty insurance"

@sthomas_eea - by Stephanie R Thomas, "economic/statistical expert & consultant specializing in employment issues"

@ijournal - daily insurance news headlines for the Property Casualty industry

@mashable - "The hottest Twitter news, Twitter tips and Twitter help"

@TheClaimsSPOT - Snippets from the blog of Marc Lanzkowsky, founder of Lanzko Consulting "Spotting process improvements & cost savings for claims & related orgs"

@ClaimsMagazine - by Eric Gilkey, Editor-in-Chief of Claims magazine

@safetycommunity - "the first online community created exclusively for the workplace safety industry," hosted and maintained by the folks at Ansell Occupational Health

@HRHero - by Tony Kessler, Group Publisher at HRHero. Information on employment law for HR and business pros from law firms in all 50 states, D.C., and Canada

@MWConsultingLLC - a company that focuses on OSHA compliance through employee training and proficiency

@NIOSH - The National Institute for Occupational Safety and Health

@hpandpsafety - "Specialists in workplace safety with emphasis on maintaining OSHA compliance"

@OccHealthSafety - Occupational Health & Safety Magazine; Carla Saavedra, Jr. Web Editor

@Health_Affairs - "The Policy Journal of the Health Sphere"

@workforcenews - News about workforce management and HR issues from Workforce Management magazine

@fastompany - "empowers innovators to challenge convention and create the future of business"

One Toke Over the Line

My colleague Julie Ferguson raised some fascinating issues relating to the growing movement to approve marijuana as a medication. As is so often the case, the implications for workers comp diverge substantially from general health issues. A toke may be just what the doctor ordered for pain management, but in the context of the workplace, any such prescriptions are likely to preclude actually reporting to work.

Here are just a few reasons why the use of medical marijuana is incompatible with the workplace:
- I cannot think of any job suitable for a person who is experiencing a marijuana high (actuaries? Just kidding)
- You cannot operate a motor vehicle or any piece of equipment safely while under the infuence of marijuana
- Imagine the impact on co-workers when a fellow employee lights up a joint. ("Note from a doctor. Yeah, right! By the way, who is your doctor?")
- Smoking is prohibited by law in virtually all indoor workplaces. "Accommodating" a marijuana smoker by allowing him/her to light up outside of the building raises issues for co-workers and the general public, not to mention the police.

It will be very interesting to see how strongly state legislatures step in to protect medical marijuana users. As Julie pointed out, no state is currently requiring that employers offer "reasonable accommodation" in this situation; it is unlikely that any will do so. The day may come when marijuana makes the list of approved medications in the workers comp system, but prescriptions for weed are unlikely to be accompanied by a return-to-work release from the doctor.

Medical marijuana, along with alcoholic beverages and prescribed opiates, may be legal substances, but employees under their influence do not belong in the workplace. Employers should place the burden of proof squarely on the shoulders of the treating doctor, who must be able to certify in writing that the prescribed use of pot does not put the employee, co-workers and the public at risk for injury. Quite frankly, unless someone works from home, I don't see how this burden of proof can be met. When it comes to performing a job safely, any toke is a toke over the line.

The current buzz on medical marijuana and the workplace

In our news roundup Wednesday, we cited a few items about medical marijuana, the most interesting to our purposes being the recent California court ruling about whether marijuana should be covered as a workers' comp medical benefit. In his posting on the topic, Roberto Ceniceros notes that there is a growing likelihood that medical marijuana will become a comp issue at some point, particularly since NJ just became the 14th state to allow medical marijuana use.

Now honestly, we hadn't given a great deal of thought to these laws previously, but if 14 states have enacted such legislation, it seems to be nearing critical mass so we went Googling to see what we could learn. Not only did we find a good resource that offers an overview of the 14 legal medical marijuana states, we also learned that there are an additional 12 states with pending legislation to legalize medical marijuana. The site is a great resource for tracking legislation, and it provides summaries with links to relevant state laws and to state sites. Did you ever think you'd see the day when states were posting marijuana FAQs?

Medical marijuana and employment issues
Clearly, medical marijuana is an issue that requires attention from any employers who have employees in affected states. And judging by the trend, it's something all employers may want to think about, starting now. Above and beyond complex issues such as workers comp, there are some immediate employment issues that come to mind: Can employers refuse to hire someone who is authorized by the state to use medical marijuana? Can an authorized medical marijuana user be fired for flunking a drug test? And if fired, can an employee file a discrimination suit under ADA? How do drug testing programs handle positive results for authorized users? And if marijuana is not considered an illicit substance due to medical authorization, how do zero tolerance programs need to adjust for this? How do employers authenticate those who are authorized to use marijuana versus those who are not authorized? And it's not just employers who have questions - authorized users of medical marijuana have employment questions too.

At Law.com, Tresa Baldas looks at many of these issues: Employers in a Haze Over Medical Marijuana Use. Citing Danielle Urban of the Denver office of Atlanta's Fisher & Phillips:

" ... under federal law, employers are not prohibited from taking adverse actions against someone who tests positive for marijuana. But Colorado permits medical marijuana, and another state law says it's illegal for an employer to fire someone for engaging in legal, off-duty behavior.

And then there's the Americans With Disabilities Act to consider. Under the ADA, an employee fired for using pot for health reasons could file a discrimination lawsuit.

"It's a gray area to know what you can do," Urban said. "But I think it's still risky to just fire someone for using it."

At least in Colorado, the caution seems well placed. According to Renee McGaw writing in the Denver Business Journal, the state has two conflicting laws: one that says that employers don’t have to accommodate medical marijuana use in the workplace while another prohibits firing employees for engaging in legal activities during nonworking hours.

On the heels of New Jersey's recent law legalizing medical marijuana, Amy Komoroski Wiwi and Nicole P. Crifo of the law firm Lowenstein Sandler PC also examine some of these issues in the unintended Impact of New Jersey's New Medical Marijuana Law on the Workplace.

The authors note that "The Act states that a qualifying patient "shall not be subject to any civil or administrative penalty, or denied any right or privilege" related to the medical use of marijuana, but it also explicitly provides that employers are not required "to accommodate the medical use of marijuana in any workplace.'" This is similar verbiage to some other state laws. (Colorado: "Nothing in this section shall require any employer to accommodate the medical use of marijuana in any work place." Rhode Island: "...employers are not required to make accommodations for employees who use medical marijuana." Montana: "Nothing ... may be construed to require an employer to accommodate the medical use of marijuana in any workplace." )

As for the issue of drug testing, the authors suggest caution when medical marijuana is cited as a defense in a positive drug test result. First, there is the matter of whether the user is authorized or not; and if so, an employer must consider whether it could be subject to liability under laws prohibiting disability discrimination for taking any adverse action against an authorized and registered user.

It's still uncertain ground. Courts in California and Montana have upheld employers that terminated employees who failed company drug tests, but each state law is different and issues haven't been fully tested in the courts. In its FAQs, when asked "What should I tell my employer if I am subjected to a drug test?," the state of Montana responds: "The law is silent on this issue."

Wiwi and Crifo offer some good tips to employers:

• Review the company’s policies and other documents addressing drug use and testing (including drug testing consent forms) and update them as necessary to state your position on medical marijuana use by job applicants and employees.
• Ensure that all Human Resources and drug testing personnel are aware of the company’s policy regarding medical marijuana.
• Adopt appropriate measures for maintaining the confidentiality of employees' and applicants' registry status.
• Maintain uniformity in the enforcement of any drug testing policy and response to positive test results.

Cavalcade of Risk and an assortment of workers' comp news briefs

It's Cavalcade of Risk day - visit the bi-weekly roundup of posts about risk, graciously hosted this week at Wenchy's Place - check out this week's edition and wish the hostess a happy birthday while there.

In other workers' comp-related news:
Medical costs and WC - Joe Paduda explains why you should expect work comp medical costs to be heading up over at Managed Care Matters. He points to one of the primary problems: "Misaligned incentives for work comp managed care programs, and payers' increased reliance on managed care program revenue and profits."

Moving violations - U.S. bans truckers, bus drivers from texting. The National Safety Council estimates that at least 1.6 million crashes are caused each year by drivers using cell phones and texting. The NSC has called for a total ban all cell phone use and texting while driving. Here's a good site to bookmark since cell phone and texting laws have been changing frequently in response to safety reports: State cell phone and texting while driving laws. It's maintained by the Governors Highway Safety Association.

More on marijuana - Should pot provided as a work comp medical benefit? Roberto Ceniceros talks about a California
marijuana ruling at Comp Time. Meanwhile, the CA Supreme Court nixed limits on medical marijuana and the Los Angeles City Council voted to close hundreds of dispensaries that have sprung up.

Global risk - Before you open that branch office in Somalia, you may want to take a look at Emily Holbrook's posting on Risk Monitor: the most hazardous countries for business.

P/C Forecast - What's in store for the property-casualty industry in 2010? Ernst & Young offer a 2010 U.S. industry outlook. (PDF)

Comp Case Law Over at LexisNexis WC Law Blog, Larson's Case Law Developments offers their picks for The Top 10 Workers' Compensation Cases of 2009.

Union census - Workplace Prof Blog reports on a Department of Labor report which shows that the union density rate was essentially unchanged in 2009 - 12.3% vs 12.4% in 2008. Among private sector employees, the rate dropped to 7.2% from the 2008 rate of 7.6%. Also of note from the report: "The data also show the median usual weekly earnings of full-time wage and salary union members were $908 per week, compared to $710 for workers not represented by unions. Union members earn 28 percent more than their non-union counterparts."

Quickies

• CA staffing firm ordered to pay $20 Million in workers' comp fraud case
• OSHA's Greatest Hits: Top 10 Citations in 2009
• Obesity epidemic in your workplace? CDC can help
• Amusing advertising clips on the topic of risk
• What's so great about Fortune's top 100 companies?

Instant Message, Instant Catastrophe

Robert Sanchez operated Metrolink trains in the Los Angeles area. By all accounts, he was a personable fellow. You might say, nice to a fault. He occasionally invited young passengers to take control of the train. He stayed in touch with train enthusiasts and friends via texting. Cool!

On September 12, 2008, he was operating a train near the end of an 11 hour shift. He was also sending and receiving text messages - 57 in all while on duty that day. Sanchez missed a red light signal and plowed without braking into a freight train heading in the opposite direction on the same track. Twenty five people died (Sanchez included); 135 were injured, many critically. For dozens of the survivors, life will never be the same. (You can attach faces to the numbers here.)

The National Transportation Safety Board (NTSB) has issued its final report. While criticizing the long shifts and the lack of automatic crash controls, the board has placed the blame squarely on the shoulders of the late Mr. Sanchez. Distracted by his texting activity, he failed to notice yellow and red signals, which should have alerted him to trouble ahead. As one board member put it, "his head was not in the game." That's an odd but apt metaphor for a tragedy on this scale, with losses totalling about $12 million, not to mention the random destruction of human life.

Distractions
We live in a world where distraction is deeply embedded in our way of life. As the poet T.S. Eliot put it in his poem "Burnt Norton," we are "distracted from distraction by distraction." From moment to moment, one thing or another tempts us. Don't like the music? Change the station. Wondering what a friend is up to? Fire off a text. No need to be bored when there are so many ways to engage our flighty minds. It's deceptively easy to multi-task your way out of the doldrums. It worked for Sanchez - up to a very specific point in time.

Eliot's poem ends with what might be an epitaph for the victims of this terrible incident, Sanchez included, who surely never intended any harm:

Ridiculous the sad waste time
stretching before and after.

Ridiculous and sad, indeed.

Health Wonk Review and other news briefs

It's Health Wonk Review week and our host is Jaan Sidorov at Disease Management Care Blog. He's just posted the "Tree of Blogs": An Avatar Movie Inspired Health Wonk Review. Jaan must be of the "spoonful of sugar makes the medicine go down" philosophy because he always manages to post the HWR news in an entertaining format. Needless to say, with the recent Massachusetts' election, health care reform will be a hot potato in this and in upcoming issues. Get the scoop from the web's smartest wonks.

For whom the bell tolls - And speaking of the Massachusetts' election this week, Joe Paduda of Managed Care Matters is right out of the gate. He takes a hard look at the state of health care reform in a pair of grim posts: An epitaph for health reform and Why health reform is dead.

Haiti relief Clair Wilkinson of the Insurance Information Institute's blog posts about the insurance industry's charitable response to Haiti so if you or your organization would like to make donations in conjunction with others in our industry, she's got the scoop. Joanne Wojcik of Business Insurance reports on some of the early insurance industry funds pledged for Haiti. Also of note: Hesperian, a non-profit publisher, is also making emergency health materials in Hatian Creole available free.

New NCCI report NCCI has just issued a new research report on Medicare and Workers Compensation Medical Cost Containment. The report looks at how how Medicare reimbursement rates influence prices paid for workers' comp medical care. Among the findings, NCCI notes that, "The proportion of workers compensation medical costs that are subject to physician fee schedules is declining, with proportionally more billings by facilities. To maintain the effectiveness of medical fee schedules, workers compensation might consider using Medicare billing approaches for hospital stays (DRG) and ambulatory services (APC), but in doing so should adapt Medicare models to workers compensation priorities."

Sleep deprivation - Roberto Ceniceros of Comp Time posts about shift work and sleep-related accidents related to workers comp in light of a recent court decision denying workers comp to a nurse who was in an accident while driving home after a 16-hour shift. (See our posts on sleepy doctors and the link etween shift work and cancer for other sleep-deprivation matters related to workers' comp.)

Still a buyer's market out there - The rumors of an impending soft market may be greatly exaggerated, at least according to the folks in the trenches. In the RIMS benchmark survey, risk managers report there is still no softening in sight. In fact, prices continue dropping, with workers comp being at the head of the pack: "Workers’ compensation and general liability saw the largest decreases, with average declines in renewal premiums of 5.5 percent and 5 percent, respectively. Average D&O premium fell 2.8 percent, and property was essentially unchanged, falling less than half of a percentage point."

EEOC reports high claims - The EEOC reports that 2009 was the second highest year for workplace bias claims. The most frequently filed discrimination allegations in 2009 were based on race (36%), retaliation (36%), and gender (30%), which the EEOC said followed recent trends.

Florida steps up fraud efforts - The state of Florida has been aggressive in its efforts to chase down employers who commit fraud by premium avoidance. Now, under a fraud pilot program, employees who swindle workers' compensation insurance companies will be targeted aggressively, too. A streamlined state bureau of workers' comp fraud investigators, assisted by an assigned prosecuter and and a team of detectives in South Florida, hopes to double arrests this year.

Short shorts
West Virginia Workers Compensation Insurer BrickStreet Approved in Illinois
OSHA issues new booklet on hexavalent chromium standards (PDF)
Avatars in the Workplace: A Legal and Ethical Minefield?
LinkedIn's Workers' Compensation Forum
Does OSHA Inspect Employers with 10 or Fewer Employees?

In Search of a Good Cup of Joe

We recently blogged a "to and fro" case involving a meandering motorcycle ride back to work from a conference. The cycle crashed and the employee filed for workers comp. The court in Wyoming determined that the accident took place during a deviation from the direct route home and thus was not compensable. Some readers commented that the employee was following his supervisor's lead, so the injury should have been compensable. "To and fro" often raises issues in the gray zone. Here's another gray area: coffee breaks.

Jesse Cooper, master plumber and foreman, needed to consult with someone at the union hall in Winslow Township, New Jersey. His contact was teaching a class, so Jesse decided to take a coffee break. He preferred the coffee at a deli some five miles down the road. On his way to a good cuppa, he was involved in a serious accident, breaking his arm and both legs.

Personal Comfort or Personal Errand?
Cooper's employer, Bernickel Enterprises, argued that the coffee break was a personal errand. Workers comp judge Bradley Henson determined that a coffee break was part of the working day and that Cooper was under the "coming and going" rule while on his way to a somewhat distant cup of joe*. He found the injuries to be compensable.

Henson describes Winslow Township as a "rural area", so the options for coffee are somewhat limited. In his summary of the case, New Jersey comp guru John Geaney notes that there were other coffee options closer than the deli; the judge, however, "accepted as credible that petitioner knew the deli had good coffee."

This ruling certainly stretches the parameters of the "personal comfort" doctrine to its outer limits. One wonders when that hypothetical line between work and personal might actually be crossed: if I have a sudden craving for a Caramel Brulee Latte (not likely, mind you) and the nearest Starbuck's is 15 miles out of the way, am I still "working" when I head in that direction?

The Driving Hazard
These two cases share one important characteristic: both involve accidents while driving, statistically the most dangerous part of the working day. As risk managers contemplate enhancements to safety programs, they would do well to put safe driving near the top of the list.

* Why do they call it a "cup of Joe"? Check this link for a possible if not entirely plausible answer involving a former Secretary of the Navy.

Older Workers and Comp: Low Risk and A Few Surprises

NCCI has issued its latest report (PDF) on the status of older workers in the comp system, with a particular focus on workers 65 and up. If nothing else, the study reinforces the notion that older workers are safety conscious and a relative bargain. For employers worried about workers comp costs, older workers are not a significant problem.

In 1988 eleven percent of workers 65+ participated in the workforce; now 17 percent of these older workers are still working. That percentage will likely increase as the long-term effects of the financial collapse continue to resonate through the damaged economy. Some people continue working because they want to; many more continue because they have no choice.

Injury Prone?
The frequency rate for older workers varies by occupation: in construction, older workers appear to be safer than younger workers - they are injured at a 4 percent rate, compared to 12 percent for their younger colleagues. The results are flipped in retail/sales: older workers are injured at a 23 percent rate, compared to 15 percent for all others.

As you might expect, the leading cause of injuries for 65+ workers are slips, falls and trips - 47 percent of all injuries for this cohort. (Younger workers suffer these injuries at a 24 percent rate). For strains and sprains - the overall leading cost-driver for workers comp - the results are reversed: the frequency for older workers is 23 percent, compared to a whopping 38 percent for all others.

It does take longer for older workers to recover from injuries: they have a median days-away-from-work rate of 16, compared to 12 days for workers in the 55 to 64 group and 10 days for workers 45-54. Despite this higher rate, overall indemnity costs are lower. Why? Because older workers make substantially less on average than younger ones. Wages peak in the mid-50s and then fall off dramatically after age 65, down to the same level as the entry level 20 to 24 group. So much for the notion of paying for experience!

The only red flags in the study involve the retail trade and service/hospitality industries, where older workers are showing higher-than-average costs for comp. These jobs probably offer ample opportunity for slips, trips and falls, the number one cause of injuries for these workers, .

It will be fascinating to watch NCCI's study evolve over the next decade. The percentage of workforce participation for the 65+ group is going to increase steadily. With this growth, the risks will be enhanced. There is likely to be an upward trend in both frequency and severity, but perhaps not as much as feared. Certainly, the NCCI study reinforces the argument that older workers are safe, reliable and motivated. There is no reason to discriminate against them. If anything, you could make a good case for preferring an older worker to a younger one. Fodder for further thought, indeed.

NOTE: Special thanks to reader Soon Yong Choi for spotting an error in an earlier version of this post (see comments). Given my checkered track record with numbers, I can only hope that Choi and similarly adept readers continue to cast a critical eye on any of my postings where statistics are involved.

New blog discoveries for our blogroll

We're in the process of updating our blogroll to add some blogs that we've been following, as well as to delete some old favorites that have become inactive. Here are a few of the blogs we've added - check them out:

Work Comp Complex Care Blog - affiliated with Total Medical Solutions, a FL-based firm that focuses on home health care and complex care products and services for the workers' comp industry.

Lexis Nexis Workers Comp Law Blogs - this is a news feed of various law bloggers who post on workers' comp legal matters.

MEMIC Safety Blog - safety & loss control consultants from Maine's largest workers' compensation insurer post about workplace safety issues.

Advanced Safety & Health Blog - safety & prevention news sponsored by a company of the same name.

Coal Tattoo - investigative reporter Ken ward Jr. of The Charleston Gazette blogs about West Virginia mining, mining safety, mining-related public health issues, and more.

Today's Workplace - a blog from workplacefairness.org, a non-profit organization that provides information, education, and assistance to individual workers and their advocates nationwide and promotes public policies that advance employee rights.

MassDevice Blog - This blog is associated with Massachusetts Medical Devices Journal, an online journal of the New England medical devices industry, with coverage of emerging trends, technology and devices that save lives.

Medgadget - this long-time favorite bills itself as the internet journal for emerging medical technologies.

WSJ Health Blog - Wall Street Journal's blog on health and the business of health.

Want to Avoid Alzheimer's? Just Keep Talking

In the interests of keeping Insider readers mentally alert for as long as possible, we present the results of a study that appeared in the Journal of Alzheimer's Disease (and is summarized in the Wall Street Journal). The study found that long-term cell phone use appears to protect against and even reverse Alzheimer's-like symptoms in mice. Here is the Journal's description of the study:

Mice genetically engineered to develop brain impairments similar to Alzheimer's in humans were divided into two groups. One group was exposed twice daily to hour-long electromagnetic fields akin to those created during cellphone use. Mice in the other group were not exposed to the radiation. After seven months, young mice in the first group fared significantly better on cognitive tests than their unexposed littermates. Older mice, which had already developed symptoms of Alzheimer's, exposed to the radiation for eight months in a subsequent experiment also performed better than older nonexposed mice. Mice, younger and older, not engineered to develop Alzheimer's also appeared to benefit from the radiation. Biopsies suggested such exposure might fight Alzheimer's by inhibiting the buildup of certain protein plaques in the brain, the researchers said.

Given that exposure to radiation is considered a plus here, head set devices cannot be used. If your goal is Alzheimer's prevention, you have to keep that cell phone clamped against your ear.

Before you start dialing up everyone on your call list, you might want to take note of a few caveats: first, what is true for mice is not necessarily true for humans. Further studies involving larger numbers of mice would be needed, and even then there would be no definitive correlation with humans.

There are also a couple of potential safety issues connected with cell phones: use of cell phones while driving is a widely-recognized hazard. In some states, use of cell phones without a head set is illegal. After being pulled over, you could try the line: "but officer, I cannot use a headset because I'm trying to avoid Alzheimer's." You'll get a chuckle...and a ticket.

Beyond the safe driving issue, there are some inconclusive but alarming indications that heavy use of cell phones might result in brain tumors.

So there you have it: talking on your cell phone might help prevent Alzheimers, but it might also cause a motor vehicle accident or even a brain tumor. Personal risk management at its ambiguous best. It's all so confusing, I'm going to take a coffee break. Caffeine, they say, is really good for you. Except when it isn't.

Haiti

As the world watches in horror and hopelessness, the people of Haiti are trying to extricate themselves from one of the great natural disasters of our lifetime. As I write, thousands of people are still alive, trapped beneath the rubble of what was once Port-Au-Prince. Very soon, most of these people will die, along with scores of the relatively unscathed who have no food, no water and no shelter. Faced with formidable logistical obstacles, the rescuers will not be able to reach most of the trapped people in time and the trickle of essential supplies may be too late for many others.

Our thoughts are with everyone who is suffering in this unimaginable disaster.

As the roads are cleared and supplies finally make their way into what is left of Haiti's capital, rescuers will face enormous hazards. Unstable buildings may collapse at any moment. Further aftershocks are likely. Everyone in the devastated landscape is breathing air contaminated with toxins. There is even a danger of mob violence, as victims become increasingly frustrated by the lack of effective response.

Among the many issues that need confronting at this time, workers comp coverage for the rescuers is probably at the bottom of the list. Yet we know from the World Trade Center experience that many first responders will be exposed to life-threatening injury and illness in the coming days and weeks. Given the magnitude of human suffering in front of them, these responders are not about to raise the issue of their own disability coverage. But the day will come when the extent and nature of that protection is paramount, when the as-yet undiscussed benefits will be an absolute necessity for individual rescuers and their families.

We blogged recently about the personal risk management in which we all engage on a daily basis. We make our choices, moment to moment, in the expectation that nothing really bad will happen. If our luck holds, we live to face the micro challenges of another day.

For the poor people of Haiti and the brave souls trying desperately to help them, the time for micro management is over. The challenge of a lifetime confronts them with savage force. May all who suffer find peace and may all who are trying to alleviate the suffering return home safely.

Postscript
See a post at HR Web Cafe on Haiti earthquake resources, which includes links for:

• Finding missing loved ones
• Ways that you can help
• Avoiding scams
• News resources
• Twitter feeds

Cavalcade of Risk and other news briefs

The first Cavalcade of Risk of the new decade has been posted by Louise of Colorado Health Insurance Insider - check it out. And while you're visiting the Cavalcade, why not check out the rest of the entries on the C.H.I.I. blog? We don't live in Colorado, but if we did, we'd definitely be doing business with Jay and Louise Norris.

The importance of the right doctor - Roberto Ceniceros of Comp Time posts about a new John Hopkins study published in the Journal of Occupational and Environmental Medicine that shows that 3.7% of doctors accounted for 72% of claim costs in a study of claims data from Louisiana Workers' Comp Corporation from 1998 to 2002. He notes that one of the researchers commented, "...it makes sense to analyze how practice patterns drive costs before instituting sweeping reform."

Sandy Blunt and the goings on in North Dakota - Good for Peter Rousmaniere and Joe Paduda for shedding light on the travesty of a prosecution related to Sandy Blunt, former CEO of North Dakota's Workforce Safety and Insurance. I met Sandy Blunt at a conference in DC a number of years ago and had been following the turn-around he was effecting in North Dakota's system. He struck me as progressive, innovative, and very sharp - it seemed a real coup for North Dakota to have his services. Then came a series of surprising charges resulting in his ouster. In following the case, it appears that most of these charges were minor, trumped up administrative issues, such as spending a few hundred dollars on lunches and gift certificates to motivate staff - practices that were not uncommon in other state departments. Other more serious charges were dismissed or shown to be erroneous. Blunt has appealed his conviction to the state's Supreme Court and we hope he will prevail.

Insurance Fraud - Emily Holbrook of Risk Monitor posts about a spike in insurance fraud as indicated by a recent report from the Coalition of Insurance Fraud: "Overall, the economy in 2009 appears to have had a significant impact on the incidence of fraud. On average, fraud bureaus reported the number of referrals received and cases opened increased in all 15 categories of fraud included in the survey." Unsurprisingly, the biggest number of fraud cases occurred in the category of bogus health insurance.

Popcorn flavorings vs public and worker health - Celeste Monforton of The Pump Handle provides an update on a public health issue of concern to workers and consumers alike: butter flavorings in popcorn. After a public outcry about diacetyl flavorings, which were causing worker and consumer health problems, the industry began substituting a product labeled as "no diacetyl." Preliminary reports from NIOSH indicate that these chemical changes do not translate into less health risk to exposed workers and consumers.

EEOC report - Workplace Prof Blog posts about Equal Employment Opportunity Commission enforcement statistics, which were recently issued for fiscal year 2009. A sampling from the EEOC press release: "The FY 2009 data show that private sector job bias charges (which include those filed against state and local governments) alleging discrimination based on disability, religion and/or national origin hit record highs. The number of charges alleging age-based discrimination reached the second-highest level ever. Continuing a decade-long trend, the most frequently filed charges with the EEOC in FY 2009 were charges alleging discrimination based on race (36%), retaliation (36%), and sex-based discrimination (30%). Multiple types of discrimination may be alleged in a single charge filing."

Work violence - Does the economy play a role in workplace violence? That's a question posed by the Christian Science Monitor in the light of a recent shooting rampage by a disgruntled worker of manufacturer ABB Group in St. Louis that left three dead and several wounded. One factor that the article did not reference is the stress that many people feel post holidays. This story brought to mind a post-holiday workplace shooting rampage in Massachusetts a number of years ago involving another disgruntled employee.

To and a Meandering Fro

Richard Selest worked for the state of Wyoming Department of Transportation. He was asked to attend a training session 100 miles away from his office. Given the nice June weather, Richard, his supervisor and a co-worker decided to ride their motorcycles. (This surely would not have been an option in January!) On the way back to the home office, they discussed taking a scenic route, but no final decision was made. When they arrived at the intersection for the scenic road, the supervisor, riding in front, turned off. Richard and the co-worker followed. In the course of the ride, Richard lost control of his motorcycle and suffered serious injuries. Compensable under comp?

Richard's claim was initially denied on the theory that the scenic route - 50 miles longer - was a deviation from the road back to the office and thus not compensable. Richard countered that his supervisor approved the deviation and that he was not on any specific "personal errand." He merely was going back to his office, albeit in a meandering fashion.

The case, like the scenic road, wended up to the Wyoming Supreme Court, where Richard once again lost. The court found that the choice of a scenic road was purely personal and a clear deviation from the "course and scope" of employment. Even though Richard had no specific goal in taking the longer road, and even though he was in fact heading back to the office, the deviation in route was substantial, thus taking him outside of comp's protective umbrella.

One justice dissented, but I think the majority acted appropriately. Despite the fact that Richard was paid for the entire trip (which took one hour longer than the direct road) and despite the fact that he followed his supervisor's lead, the deviation had nothing whatsoever to do with work. As all good claims adjusters know, this is a matter of reading a map: the presumptive route to the office is a (relatively) straight line. Richard and his co-workers were seduced by the curvy call of nature, for which poor Richard has had to pay a very steep price.

From Hedge Funds to Comp Board: A Welcome to Jeffrey Fenster

Back in June we blogged the resignation of Zach Weiss from one of the more difficult jobs in America: head of New York's workers comp board. Weiss had been appointed by former governor Elliot Spitzer (whose libidinous indiscretions, we note in passing, were relatively modest, at least when judged by the new standard set by Tiger Woods). After two years mired in New York's deeply adversarial system, Weiss quit to become an administrative law judge.

Governor David Patterson, who stepped in when Spitzer stepped down, has announced the appointment of Jeffrey Fenster as the new director of the board. Today is Fenster's first day on the job. Fenster is a lawyer who once worked for WR Group Holdings, a hedge fund group based in Connecticut. The company website features a picture of the Connecticut shore with a lighthouse in the distance. The sea is absolutely calm - not exactly indicative of the world of hedge funds, or the world of workers comp, for that matter.

If nothing else, Fenster's experience in hedge funds prepares him for the complex risks involved in his new position. He now manages one of the most expensive, frictional, cumbersome, and ineffective comp systems in America. Despite recent reforms, rates are still too high, benefits are too low, fraud is rampant and virtually all stakeholders are miserable. The Empire state is a mess. I have no idea what Governor Patterson promised Fenster for taking the job, but it probably wasn't enough. Fenster is likely to look back on his presumably hectic hedge fund days as the calm before the storm, which is not exactly high praise for his new job. Good luck to him and to all who labor in New York's challenged and challenging comp system.