September 2012 Archives

September 27, 2012

 

Being Washington DC denizens, Jennifer Salopek and the folks over at Wing of Zock have had a hard time focusing on anything besides the playoff, but they've taken their eyes off the ball long enough to compile a stellar Health Wonk Review: Nationals Playoff Edition! - check out the biweekly best of the health policy blogosphere.

Work Fatalities - Preliminary results from the Bureau of Labor Statistics show that workplace fatalities declined in 2011. The number of workers who died from on-the-job injuries was 4,609 in 2011, down from a final count of 4,690 in 2010. Good news, but that is still 13 workers too many, on average, who die at work every day. Liz Borkowski looks at what the report does and doesn't tell us.

Flu vaccines & workers comp - Jon Gelman has a good post on Compensating Adverse Flu Vaccine Reaction Victims. He notes, "In many jurisdictions, vaccinations afforded to employees resulting in a benefit to the employer against possible disastrous business consequences, have been considered to be "a mutual benefit." Therefore, any disease arising from such vaccination has been deemed compensable."

Global warming & productivity - Will climate change affect worker productivity? According to recent research, 2% per degree Celsius is the magic number for how worker productivity responds to warm/hot temperatures. In addition to citing specific research on the topic, the poster cites a recent real-life scenario: After the Fukushima earthquake and tsunami knocked out a big chunk of the country's nuclear power, the Japanese government mandated reduced energy consumption, and found that when you lowered the AC, it had an effect on output: "every degree rise in temperature above 25 Celsius (77 degrees Fahrenheit) resulted in a 2 percent drop in productivity."

Litigation - Insurance journalist/blogger Anne Marie Lipold has a good pair of posts on how good communication practices when a worker is inured can minimize the friction that all too often leads to preventable litigation. See Why Injured Workers Hire Attorneys (and What Employers Can Do About It) , part 1 and part 2. In the same vein, we refer you to one of the best pieces we've seen on this topic - written by someone who ought to know, plaintiff attorney Alan S. Pierce: Top Ten List as to Why Injured Workers Retain Attorneys.

Kudos - Congratulations to Bob Wilson and crew -- today marks year 13 for workerscompensation.com. A landmark worth celebration - Bob was quite the visionary to be out there on the web and very smart to have purchased such a great web address! His site has always been in the forefront of what's happening in the work comp arena - it's an online staple. In his post, he waxes nostalgic about some of the developmental highlights over the highlights. Good on you, Bob - thanks for being a steady resource!

More news of note


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September 25, 2012

 

One of the most compelling issues in the compensability of workers comp claims is determining the moment when coverage begins. For most workers, coverage begins at the worksite, often in the employer's parking lot. Under the "coming and going" (or "to and fro") rule, the commute to and from work is generally not covered. There are exceptions, of course, and these exceptions become the focus of litigation when an injury occurs during a commute. When a serious injury or, in today's case, a fatality occurs, there is a lot at stake in the interpretation of this deceptively simple rule.

Juan de los Santos worked for Ram Production Services, a Texas company that services gas and oil leases. De los Santos was assigned to work on a gas lease located on a large piece of fenced ranchland. The employer furnished de los Santos with a company-owned truck and paid for work-related fuel expenses. The truck was not for personal use. De los Santos spent a significant part of his workday traveling to wells and job sites within a designated area known as the Buck Hamilton Ranch. De los Santos entered the ranch through the only entrance, a gate where he was signed in by a guard. De los Santos traveled to the exact same location each day to begin his work, which started at 6:00 a.m. He was a salaried employee, who was not paid extra for his travel.

One Fateful Day
In June of 2005, de los Santos was driving to work, on a public highway, when he was involved in an accident that resulted in his death. He was survived by his wife, Noela, and his daughter, Kimberly Ann. [Note that the litigation around the compensability of his death remained unresolved more than seven years later.] Noela filed for workers comp benefits, which were denied, then granted, and then finally resolved in the Texas Fourth Court of Appeals.

Mrs. de los Santos tried to develop a narrative of the accident that met the standard for a compensable claim: she noted that her husband was traveling in a company truck furnished as part of his employment contract, and that her husband's travel originated in the employer's business because he was taking a route to a remote job location, was on a "special mission" at the time of the accident, and was transporting tools and equipment to the worksite.

Deconstructed Narrative
The appeals court dismantled her narrative one piece at a time:
- Being in a company vehicle does not mean you are necessarily "in the course and scope" of employment;
- Yes, he was driving to a remote location, but that was his regular assignment, unchanging from week to week;
- Even though he was meeting a contractor at the jobsite, this did not mean he was on a "special mission" as he was headed to his usual workplace at the usual time;
- And the fact that he was carrying tools and equipment did not change the nature of the commute. [NOTE: had he been injured moving the equipment into the truck, he would have had a compensable claim.]

The court noted that "there is no bright line rule for determining if employee travel originates in the employer's business; each situation is dependent on the facts." And the facts, as the court interpreted them, did not favor the widow's claim. They reversed the trial court's ruling by rendering a "take-nothing" judgment. Take nothing, indeed.

Thus, after seven years, the case grinds to its conclusion. Mrs. de los Santos and her daughter are on their own.

Letter of the Law
The court was correct in its determination that de los Santos was on his ordinary commute to his regular workplace. While we all have moments when we might like to engage in social engineering - the widow and her daughter certainly could use a helping hand - the rules are the rules and the law is the law. Workers comp offers a formidable package of benefits to workers across America. The wage benefits are generous and the medical benefits superior to any conventional health plan. But the barrier to coverage is substantial: the injury - in this case, fatality - must arise "in the course and scope" of employment. In his drive seven years ago on that lonely and presumably quiet back road to his remote job site, de los Santos was commuting to work. He never made it to the Buck Hamilton Ranch. Now, years later, his widow must deal with the consequences of his not quite reaching the gate, where his compensable workday would have begun.

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September 24, 2012

 

Cooper Road in Middletown, New Jersey, is rumored to be haunted by strange, ghostly creatures. They jump out from behind trees and startle the drivers of cars traveling down an unpaved portion of the road. There are no street lights and the road has sharp turns, so the appearance of these apparitions is both sudden and alarming. Based upon the numerous oddities in New Jersey's workers comp law, these ghostly beings might well be carrying sign boards that read "Ruined by balanced billing."

From the perspective of virtually any other state jurisdiction, New Jersey's approach to the reimbursement of medical providers in the workers comp system is demon-ridden and rather strange. To begin with, there is no fee schedule. Providers are entitled to their "usual and customary" fees. By leaving fees to the providers, the state creates an unusual level of tension between these providers and the insurance carriers and self-insured employers who pay the bills.

The tensions are not limited to the payers, however. When a payer refuses to cover all or part of the "usual and customary" bill, the provider has the option of billing the injured worker for the balance. The euphemism is "balanced billing" but in both concept and practice this is as unbalanced as a comp system can get.

The Broken Premise
The fundamental premise of workers comp is that the medical costs and lost wages of workers injured on the job will be covered by their employers. In return, workers have given up the right to sue their employers for work-related injuries and illnesses. In most states, the protective barrier between injured workers and the costs of treatment is absolute: there are no copays, no deductibles and no fees whatsoever for injured workers. Comp even covers the cost of travel to and from treatment. "Out of pocket" is a concept that simply has no place in workers comp.

Medical coverage under workers compensation is, in the words of my colleague Tom Lynch, "the best coverage plan in the world": it pays for everything and includes indemnity payments for lost wages, too. The only catch - and it's a big one - is that to qualify you must be injured "in the course and scope" of employment, with an injury "arising out of" employment.

Balanced billing is patently unfair to workers. Routine disputes between medical providers and payers spill over to injured workers. Unpaid portions of medical bills are sent to the workers, who are in no position to pay them. When workers routinely refuse to pay these bills, they may find themselves harassed by collection agencies. Not exactly what the doctor ordered when you are trying to recover from your injury and return to work.

Senate 2022 to the Rescue?
Senate Bill 2022 is wending its way through the New Jersey legislature. The bill recognizes the inherent unfairness of balanced billing and would put an end to the practice. Any disputes about payment would revert to the workers comp bureaucracy, but under no circumstances would the disputed portion of any medical bill become the responsibility of the injured worker.

It's interesting to note that the bill explicitly avoids the issue of a fee schedule. Medical providers will continue to bill for their "usual and customary" fees, which, in turn, will keep the cost of medical treatment relatively high. But at least the injured workers will be exempt from the dispute. That's the least the Garden State can do in its belated effort to restore fairness and equity to the comp system.

Here's hoping that S 2022, in one form or another, finds its way to the Governor's desk in time for Halloween. That would soothe the ghosts on Cooper Road and allow them to revise their signs to address some other glaring inequity in our imperfect world.

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September 21, 2012

 

Back in 2009 we blogged the fate of strippers at the ironically named King Arthur lounge in Chelsea MA. The club treated the women as independent contractors, but the court found that they were employees and ordered the lounge to pay back wages to the strippers. (I wonder if they were able to collect.) Today we examine a similar situation with a dramatically different outcome: the saga of LeAndra Lewis, a free-lance stripper in the Carolinas.

The 19 year old Lewis worked a network of strip clubs in North and South Carolina. She traveled from one club to another, bringing her own (skimpy) costumes and working on her own schedule. She would approach a given club, uninvited and unannounced, and ask for access to the stage. She would pay an enrollment fee (about $70) and then dance as she wished to dance, collecting tips from the customers. If a given customer really liked her work, he might "make it rain" with dollar bills. At the end of the evening, she would pay a portion of her tips to the club owner. Lewis grossed an estimated $82,000 a year, but no one knows for sure, as she did not bother filing a tax form.

In June of 2008 she found herself working in L.B. Dynasty, DBA Boom Boom Room Studio 54 - you have to love the Studio 54 tag, adding a touch of New York glamour - and some white powder? - to an otherwise marginal venue. A fight broke out while Lewis was in the club. A random bullet hit her in the stomach, causing severe internal injuries. She filed for workers comp benefits; the club did not carry insurance (surely no surprise), so the claim reverted to the South Carolina Uninsured Fund. Her claim was denied on the basis that she was an independent contractor, not an employee of the club.

The Usual Criteria in an Unusual Setting
In its ruling on Lewis's claim, the South Carolina Appeals Court upheld the denial. They used the typical four pronged analysis for independent contractors to determine her work status:

1. The right or exercise of control: Lewis was free to come and go and free to dance as she chose; there were rules of behavior, but these did not constitute an employment relationship;
2. Furnishing of equipment: the court observed that the provision of a stage, a pole and music were practical matters, as a traveling stripper would not be able to bring these to each venue;
3. Method payment: the club did not actually pay Lewis anything, as she herself paid a fee to dance and a portion of her earnings to the club.
[NOTE: As we noted above, Lewis paid no taxes on her earnings, and it goes without saying the club paid no benefits on her behalf.]
4. The right to fire: the court determined that the right to throw Lewis out for violation of club rules did not make her an employee.

Judge Short dissented from the majority opinion, noting instances in other states where strippers were determined to be employees - he did not site the King Arthur Lounge case. But sad as Lewis's story is, and tragic as the results for her have been, the court probably got this one right. Lewis worked as an itinerant stripper, with no real base of operations. She walked into clubs, offered her services, and was given a stage on which to perform. She moved on when she felt like it. Had she been a regular at the Boom Boom Room, she could have made a stronger case. But this 19 year old woman was very much on her own. The money was good while it lasted, but she now finds herself unable to have children and, due her scars, unable to perform her chosen work. Like all truly independent contractors, Lewis was on her own that fateful day in 2008 and she must live with the consequences for the rest of her life.

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September 19, 2012

 

The man of the hour - Kudos to Gary Annenberg, whose guest post on Predictive Modeling we featured earlier this week. We were pleased to learn that he was also just named as a 2012 Risk Innovator in Safety and Prevention. The awards are presented annually by Risk & Insurance - see a list of all 2012 Risk Innovators. But that's not the only news item we noticed about Gary - he is also scheduled as a speaker for the 2012 Business Insurance Workers Compensation Virtual Conference on Oct 25. There's no charge to attend, and Gary is one of an impressive lineup.

Cavalcade of Risk - Jeff Rosen makes his hosting debut with the biweekly roundup of risk-related posts at his Life Insurance blog - check it out: Cavalcade of Risk #166.

Recommended reading - Check out Sandy's Corner over at Meddata. It's a forum where Sandy Blunt occasionally opines, most recently on Medical Treatment Guidelines. Among the many hats Sandy wears, he provides consulting services to Medata as a technical subject matter expert in workers' compensation.

Emergency Responders - This month, NIOSH Science Blog focuses on safety and health risks related to emergency workers. The post includes links to a new technical assistance document, Emergency Responder Health Monitoring and Surveillance. It includes specific recommendations and tools for all phases of a response, including the pre-deployment, deployment, and post-deployment phase. The intent is to identify exposures and/or signs and symptoms early in the course of an emergency response.

Mining fatalities higher than last year - At Coal Tattoo, journalist Ken Ward reports on the death of a West Virginia miner last week at a Consol Energy operation in Monongalia County. The week also saw the death of a miner at a Drummond Mining Co. operation in Alabama. Ken notes that the WV death was the state's fifth coal-mining fatality in 2012. To date, mining fatalities through mid-September 2012 are higher (15) than at the same point last year (13).

Fraud - A new report from Deloitte Consulting says that fraud is exploding, with the rate of questionable claims increasing by 19 percent from 2009 to 2011. The report says that workers comp is one of the largest fraud areas. And in a related matter, here are the Top 10 Most Sensational Fraud Stories of the First Half of 2012


$576 billion price tag - That's the annual cost to employers for unhealthy workers, according to the Integrated Benefits Institute. This includes absences ranging from sick days to time lost to workers' compensation claims. IBI researchers attribute 39 percent (or $227 billion) to lost productivity associated with poor health.

News Briefs


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September 18, 2012

 

Five years ago we blogged Missouri's tough-on-workers reforms that made it more difficult to collect benefits in the "show me" state. Among the provisions in the new law was a 20 to 50 percent reduction in indemnity for workers who are injured while wilfully ignoring the employer's safety program.

Which brings us to Dennis Carver, a roofer who worked for Delta Innovative Services in Kansas City. Carver was carrying a 100-pound roll of composite weather barrier up a ladder - no easy task! - when he injured his back, resulting in a permanent total disability. The problem was that Delta had a safety policy that required three point contact with a ladder at all times: it would be physically impossible to carry a 100 pound roll and maintain three point contact. Because he violated the policy, Carver's indemnity was cut in half, from $743 per week to $371.

Carver admitted that he went to work with the intent of violating the policy. He knew that instead of having the usual crew of 11 men on the job, the crew that day would total two people: himself as foreman and one other crew member working in a separate area. He knew full well that he was on his own. He also knew that company policy required that he use a hand pulley or power equipment - or request the assistance of a coworker - to lift materials to the top of a ladder.

Delta argued that Carver caused his own injury by failing to follow its "three-point" safety rule. Slam dunk for the employer? Here is the statute:

[w]here the injury is caused by the failure of the employee to use safety devices where provided by the employer, or from the employee's failure to obey any reasonable rule adopted by the employer for the safety of employees, the compensation and death benefit provided for herein shall be reduced at least twenty-five but not more than fifty percent; provided, that it is shown that the employee had actual knowledge of the rule so adopted by the employer; and provided, further, that the employer had, prior to the injury, made a reasonable effort to cause his or her employees to use the safety device or devices and to obey or follow the rule so adopted for the safety of the employees.§ 287.120.5

"The burden of establishing any affirmative defense is on the employer․ In asserting any claim or defense based on a factual proposition, the party asserting such claim or defense must establish that such proposition is more likely to be true than not true." § 287.808.

The Checklist
Thus the statute presents a checklist for reducing indemnity payments:

1. that the employer adopted a reasonable rule for the safety of employees; CHECK

2. that the injury was caused by the failure of the employee to obey the safety rule; CHECK

3. that the employee had actual knowledge of the rule; CHECK and

4. that prior to the injury the employer had made a reasonable effort to cause his or her employees to obey the safety rule. NOT SO FAST!

Theory and Practice
While Delta's owner, Danny Boyle, testified that "[n]ormally our guys are trained ․ [that] the only thing that should be carried on a ladder is the person himself," he then testified that employees routinely violated that rule:

Q. Does that mean nobody ever carries anything?

A. Not at all. Guys tend to do things wrong all the time.[emphasis added]

Q. And that's what--

A. I'm just being truthful.

Q. Sure. It happens. It's faster to carry it up sometimes?

A. Yes.

Q. Because you're trying to finish a job and get something done, you may carry something up a ladder as opposed to using the beam?

A. Yes.

Q. Or the pulley?

A. Yes.

Even though Boyle was aware of multiple instances in which employees had failed to follow the three-point rule, he was unable to provide any testimony concerning discipline imposed on noncompliant employees. In other words, the policy was not enforced. And because it was not enforced, Delta must own the consequences of employees failing to follow it.

The Court of Appeals remanded this case back the workers comp commission, for a closer examination of whether there were grounds for reducing the indemnity payments. In all likelihood, Carver will collect the full indemnity.

Roofers at Risk
Boyle's testimony that "guys tend to do things wrong all the time" reminds me of a telling moment in a training session some years ago. I was explaining the implications of implementing a drug testing program and the owner of a small roofing company responded: "I could never do that. Half my guys would fail." [Need I add that, following the seminar, I alerted the underwriter to flag that account for non-renewal?]

Would it surprise you to learn that roofing is one of the most expensive job classes in workers comp? The rates can run as high as $50.00 per $100 of payroll and even higher. It is difficult, demanding work. In some respects, there is no such thing as a good day for a roofer: it's either too hot, too cold, or too windy. The exposures are relentless and the work itself, especially on the commercial side with hot tar involved, can be noxious.

Owners of roofing companies like Danny Boyle are faced with a daily conundrum: do I enforce the rules and slow down the work? Do I discipline employees for violations or let the work flow, hazards be damned? In the course of normal employment, it's tempting to ignore the finer points of safety. But that puts workers at risk for serious injuries - and owners at risk for footing substantial bills.

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September 17, 2012

 

Today, we host a guest blog written by our good friend and colleague, Gary Anderberg, PhD (Stanford). In addition to being one of the smartest people I have ever met (and I've met a lot of smart people), Gary is an exceptionally interesting and imaginative person. Currently Broadspire's Practice Leader for Analytics and Outcomes in its Absence and Care Management Division, Gary is quite the expert regarding predictive modeling.

Gary's been a college professor, a management consultant, VP of a California TPA and Founder of another California TPA. He helped design Zenith National's Single-Point Program and Developed Prudential's Workers Comp Managed Care Program, as well as its Integrated Disability Management Product.

Gary went to college to become an astrophysicist, but along the way found himself with a passion for ancient languages and cultures. As he puts it, "Some of my best friends have been dead for a few thousand years." If that's not enough, he also writes mystery novels, short stories and screenplays, and is a member of the Mystery Writers of America. In his spare time (you may be forgiven for asking, "He has spare time?"), Gary can sometimes be seen driving his space-age motorcycle through the back roads of Pennsylvania, wearing enough protective gear to make him look like an intergalactic warrior. - Tom Lynch

Predictive Modeling in Workers' Compensation

Predictive modeling (PM) appears to be the buzzword du jour in workers' compensation. There are real reasons why PM can be important in managing workers' comp claims, so let's stop and take a look at the substance behind the buzz.

PM is a process. Put simply, we look at tens of thousands of claims and try to discern patterns that link inputs - claimant demographics, the nature of an injury, the jurisdiction and many other factors - to claim outcomes. Modelers use many related techniques - Bayesian scoring, various types of regression analysis and neural networks are the most common - but the aim is always to link early information about a claim with the most probable outcome.

Obviously, if the probable outcome is negative - a high reserve, a prolonged period of TTD or the like - modeling can prompt various interventions designed to address and ameliorate that negative outcome. In effect, we are predicting the future in order to change the future. Spotting the potential $250,000 claim and turning it into an actual $60,000 claim is how PM pays for itself.

There are two approaches to PM: (a) mining existing claims data and (b) using claims data plus collateral information that models claim factors not well represented in a standard claim file. Ordinary data mining uses the information captured as data points during the claim process - claimant demographics, ICD-9 codes, NCCI codes, location, etc. But the standard claim file is data-poor. Much of the most revealing information about claimant attitude, co-morbid conditions, workplace conflicts and the like is captured - if it is captured at all - as narrative. Text data mining is a complex and less-than-precise science at this point, thus conventional data mining is limited in what it can provide for PM.

The best PM applications based on conventional data mining can provide a useful red light, yellow light, green light classification for new claims, identifying those claims with obvious problems and those that are obviously clean, leaving a group of ambiguous claims in the middle. This is a good start, but two important refinements that ratchet up the usefulness of PM materially are becoming available.

Sociologists, psychologists, industrial hygienists and others have done a tremendous amount of research in the last 30 years or so into the many factors that influence claims outcomes and delay normal RTW. Many of these factors are not captured in the standard claims process, but they can be captured through the use of an enhanced interview protocol and they can be mathematically modeled as part of a PM application.

Systems are already in place that ask value-neutral but predictive questions during the initial three point contact interviews. Combining the new information from the added questions with the models already developed through claim data mining produces a more granular PM output, which can identify particular claim issues for possible intervention.

For example, development is now underway to include a likelihood of litigation component in an existing PM system by adding a few interview questions and combining those responses with information already captured. Predicting the probability of litigation has a clear value to the adjuster and others in the claim process. Can potential litigation be avoided by changes in how the claim is managed? Do other factors in the claim make running the risk of litigation a worthwhile gamble? Better predictions make for more effective claim management.

Most of the PM systems in development or online are front-end loaded and look at the initial claim data set. But some trials are already underway to perform continuous modeling to look for dangers that may arise as the claim develops. The initial data set for a new claim can predict the most probable glide path for that claim, and in most cases the actual development of the claim will approximate that glide path. In some cases, however, the development can go awry. A secondary infection sets in or the claimant unexpectedly becomes severely depressed or lawyers up. This new, ongoing PM process monitors each claim against its predicted glide path and warns whenever a claim seems to be in danger of becoming an outlier - or a reinsurance event.

But wait a minute: isn't an alert adjuster supposed to catch all of these factors from the initial interviews on? The use of PM is predicated on the idea that the best adjuster can have a bad day or miss a clue in an interview. A claim may have to be transferred to a new adjuster due to vacation, illness or retirement. Claim adjusters may well have invented the concept of multitasking and we all know that oversights can happen in a high-pressure environment.

A good PM application is the backstop, and it can be set up to alert not just the adjuster, but also the supervisor, the unit manager and the client's claim analyst all at the same time. This brings new power and precision to the whole claim process, but only if the PM application becomes an integral part of how clams are handled and is not relegated to after-the-fact reporting. Several presentations at a recent Predictive Analytics World Conference in San Francisco made it clear that, in a wide range of business models, PM is still a peripheral function which has not yet been integrated into core processes.

To make the best use of PM in managing workers' comp claims, two conditions have to be met: (a) adjusters have to understand that PM does not replace them or dumb down their jobs and (b) claim managers have to trust the insights that PM offers. When the PM system tells you that this little puppy dog claim has a very high potential to morph into a snarling Cujo based on how the claimant answered a handful of non-standard questions . . . believe it. Taking a wait and see approach defeats the whole purpose of PM, which is to get ahead of events, not trail along after them in futile desperation.

Remember, the purpose of PM is to avert unfortunate possible outcomes. This is one job at which you can never be too effective. Progress catches up with all of us - even in workers' comp (one of the last major insurance lines to go paperless, for example). It is unlikely that, in another five years, any claim process without a robust PM component can remain competitive. If you can't predict how claims will develop, you will be throwing money away.

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September 14, 2012

 

Whether in a local coffee shop or a Dunkin Donuts (but never a Starbucks?), the coffee break is an iconic moment in the routine of a police officer and thus appropriate fodder for our Friday blog.

Carolyn McDermed, a lieutenant in the Eugene, Oregon, police department, left her desk in the station and walked across the street to purchase coffee. She planned to drink it at her desk. Unfortunately, she was struck by a car and suffered multiple injuries. Her claim for workers comp revolved around one central issue: was she on a personal errand or "in the course and scope" of employment? Was she on a break or on call?

An administrative law judge ruled that McDermed was indeed working; the ruling was upheld recently by the Oregon Court of Appeals.

McDermed worked in the Office of Professional Standards; she managed her own time and took breaks when she felt like it. But unlike most of us, who can leave our work behind when we head out for coffee, McDermed was still prepared to do her job. She carried her cell phone and might be required to return to her office on a moment's notice. Indeed, her coffee breaks were not without incident: one time she witnessed an auto accident and administered first aid; another time she escorted a woman fearful of a stalker to the latter's office; and when a vehicle caught fire near her office, she applied a fire extinguisher and exerted crowd control. As a well-known, 17 year veteran of the force, she found herself frequently answering questions out in public about community law enforcement concerns. No wonder she would take the coffee back to her desk, where she could at least enjoy it in relative quiet.

Public safety officers are a bit like comic book heroes: they are expected to respond to public need at a moment's notice. Thus, even though there were no safety issues on the day of the accident, McDermed was prepared to respond had something arisen. She was on duty and on call. Her work environment was not limited to her desk in the police station, where most of her duties were performed.

In the Course of Employment
The appeals court clarified the concept of "in the course of" employment:

An injury occurs 'in the course of' employment if it takes place within the period of employment, at a place where a worker reasonably may be expected to be, and while the worker reasonably is fulfilling the duties of the employment or is doing something reasonably incidental to it."

It is possible to extend the implications of this ruling to the point where public safety officers are on call 24/7. When the police encounter a circumstance requiring intervention or assistance, they are obligated to respond. They might be home in bed, or shopping at a mall with the family, or just moseying across the street for a cup of coffee, but they must be ready for anything and thus they are, potentially at least, at work. Compensability would revolve around what they were doing at the time of the injury and why they were doing it. In McDermed's case, her taking a break did not sever her availability for service.

So the next time you see some cops taking a coffee break (that shouldn't take very long), rather than ask whether they could find something better to do, remind yourself that they are on call and at work, unlike most of us, whose coffee breaks really are a break from our daily routines.

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September 13, 2012

 

Check out a fun and smart Health Wonk Review - "Football Is Here" Edition posted by Louise Norris at Colorado Health Insurance Insider.

We don't want to step on her toes here, just go read the whole edition, which is a pretty full one -- Louise always does a very thoughtful job in framing each entry -- but we would echo her recommendation to be sure to visit the post from Amy Berman - the first one in this edition. It's so very worth reading and thinking about. Thank you Amy, and best to you!

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September 11, 2012

 

I have written before about what I consider to be a true Massachusetts Miracle: The 1992 reform of the Commonwealth's workers' compensation system and the results achieved following that reform. Bottom line - premium rates in Massachusetts are among the lowest in the nation while benefits are among the highest.

To make that happen back in 1992 all of the varying and vested constituencies had to come together and enter a grand compromise where everyone lost something so that the system could flourish as it has ever since (I won't bother to mention that the current crop of folks we Americans have sent to the nation's capital might learn something from this).

Employers and injured workers have benefited hugely from the 1992 reform. Insurers not so much, especially lately. Early this year, the Massachusetts Workers Compensation Rating and Inspection Bureau, representing insurers doing workers comp business in the Commonwealth, requested that Massachusetts Commissioner of Insurance, Joseph G. Murphy, approve a premium rate increase of 18.8%. After the Division held hearings and thought about it for a while, Mr. Murphy announced that he was denying the request - all of it. Result: Status quo, just as in New York a few weeks earlier. But if you think about it, this might actually be an insurer victory of sorts, because Massachusetts Attorney General Martha Coakley had made her own rate filing, which called for a reduction in rates of 8.8%. After Commissioner Murphy announced his decision, Ms. Coakley issued a press release saying, "The industry's request to raise rates could not have come at a worse time for small businesses in Massachusetts." She also congratulated herself and Commissioner Murphy by saying, "The decision will save Massachusetts workers compensation insurance customers approximately $175 million compared to the rates they would have paid if the proposed rate hike was approved."

The decision will also cost the Commonwealth's insurers the same $175 million.

But let's get real for a minute. As Bill Clinton said last week, "It's all about the arithmetic."

Now, there are many variables impacting premium rates in any state. For example, workers compensation medical loss costs have been rising in Massachusetts. Just a couple of years ago they comprised an enviable 36% of total loss costs; now they're up to about 40%, and rising. But I thought perhaps I could put things in perspective if I just looked at the Massachusetts evolutionary development of a few key factors since the 1992 reforms. And those factors would be workers compensation premium rate changes, wage development and the progression of the CPI. The data in the chart below is taken from the Bureau of Labor Statistics, the Massachusetts Division of Unemployment Assistance and the Massachusetts Department of Industrial Accidents (DIA), summarized in the Massachusetts Division of Insurance's Annual Report of 2010 (PDF) and DIA Circular Letter 336, dated 6 October 2010 (PDF).

ma-rate-changes.JPG

In the 17 years since 1994, there have been six years with double digit rate reductions, the largest being 21.1% in 1998, five years with single digit reductions, ranging from 1% to 4%, five years without change, and one year with a whopping big rate increase of 1%. The result is that rates in Massachusetts are where they were in the early 1980s. One by-product of this situation is that many Massachusetts employers seem to have lost the sense of urgency when injuries occur.

On the other hand, the CPI has increased every year since 1994 with the exception of 2010, when there was no change (it's interesting to compare the CPI development with periods of recession; look at 2009 and 2010, for example), and the average weekly wage in the Commonwealth has grown from $586 in 1994 to $1,088 in 2010 (in 2012, it's now more than $1,100).

The result shows a steady increase in costs and a steady decline in rates. I have to say that the reductions from 1994 through 1999 were entirely appropriate; those are the result of the 1992 reform. However, the six years with reductions since then, totally 28.3%, are questionable.

The consequences of both Commissioner Murphy's current decision as well as the recent reductions are now being felt. The Massachusetts Assigned Risk Pool is growing quickly; in the last year it's jumped from 12% of the market to 15% ($152 million in premium), and that was before the decision of two weeks ago. It would not surprise me to see Pool growth accelerate in the immediate future.

You can only keep the pressure cooker's lid on for so long.

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September 10, 2012

 

We have been tracking the compelling issue of compensability in drug overdoses within the workers comp system. We have blogged drug-induced fatalities that are compensable (Tennessee) and non-compensable (Ohio and Connecticut). Given the prevalence - make that rampant over-use - of opioids in the workers comp system, prescription drug abuse is an issue with profound implications for injured workers, their employers and the insurers writing workers comp policies across the country.

Which brings us to the saga of Bruce Ferguson-Stewart. He was injured on May 25, 2004 while working for AltairStrickland, an industrial contracting firm in Texas. A bolt weighing several pounds fell from above, striking Ferguson-Stewart and injuring his shoulder and neck. The MRI showed "minor disc bulges" at three levels on his cervical vertebrae. His treating physician diagnosed him with a left shoulder contusion and prescribed hydrocodone as part of the treatment plan. The doctor also recommended surgery to repair the shoulder.

Denial and its Consequences
For reasons that are not clear from the trial documents, the claim was denied by Commerce & Industry Insurance, the employer's carrier. The carrier lost the initial appeal and then lost again. The insurer then sought judicial review of the Division-level finding of compensability.

Meanwhile, with his shoulder untreated and in extreme pain, Stewart continued to take his prescribed Hydrocodone, known locally as an "East Texas cocktail." At every level of appeal, the compensability of the claim was upheld, but the surgery was delayed - with apparently disastrous results. (The delaying tactics may have been related to Stewart's alleged history of abusing prescription drugs.)

On October 3, 2004, while his worker's compensation claim was still being contested, Ferguson-Stewart died from an overdose of hydrocodone. His blood contained a hydrocodone level of 0.38 mg/L, which is consistent with acute severe toxicity. The blood also contained carisoprodol, a prescription muscle relaxant, and marihuana.

Trial by Jury
Ferguson-Stewart's widow filed for death benefits under workers comp, but the case was denied. The widow appealed.

At trial, Ferguson-Stewart presented two theories as to how and why Stewart might have unintentionally or unknowingly ingested a lethal dose of hydrocodone. First, in what CIIC describes as the "accidental overdose" theory, Ferguson-Stewart alleged that the overdose must have been accidental because her husband did not intentionally or knowingly commit suicide.

Tommy J. Brown, a forensic pathologist who performed an autopsy on Stewart, concluded that the cause of death was hydrocodone toxicity and that the manner of death was "accidental." Brown's testimony is right out of central casting:

Well, I--I see it a lot. I do autopsies on people with chronic pain a lot and this--like before I see them, start out with their drugs and then they increase the drugs, and then to try the [sic] alleviate the pain more, and pretty soon they're taking more than prescribed, and pretty soon they will overdose theirselves [sic] or they will overdose theirselves [sic], some people do. And then they die and it's usually in a low lethal range [like that observed in Stewart]. So I consider that an accidental death because they were overdosing due to the chronic pain.

With its pathos and illuminating detail, the widow's testimony reads like a monologue from a Faulkner novel:

The day before or the day of--that he died. They say he actually died
early in the morning; so, I guess the day before. He was really disoriented. He was not acting normal or the way he had been acting since he was hurt. He wasn't acting normal at all. His speech was slurred. He was stumbling and falling all over things. I remember--I think I remember one time he actually falling [sic] out of a chair and--in the yard
because he was trying to get up and he tripped over a root and he fell on
the shoulder he had injured. And that made it even that much more
painful for him. He was--he was very--he was crying about it. He really
had hurt himself.
. . . .
He was--in the last couple of days before he died, he was getting really
bad about forgetting that he had already taken his medicine and taking it
again; and you know, sometimes I would have to tell him, "Hey, you
already took it. You can't take it again." And usually he would agree with me; but there were times when he would say, "No. No. No. I didn't take it. I'm sure I didn't take it. I'm still hurting too bad, and I don't remember taking it." So, he'd take it again.
But especially the day of [his death], he was entirely too confused. He
wasn't--like I said, he wasn't himself at all.

The jury charge instructed that "[a] claimant's death does not
result from medical treatment instituted to relieve the effects of his compensable injury if the death results solely from a claimant intentionally or knowingly failing to comply with his doctor's instructions[emphasis added]." The jury concluded that Ferguson-Stewart's death was unintentional, resulting from the treatment for his compensable injury. The widow was granted death benefits.

Intention, Confusion and Compensability
Under Texas law, compensability hinges on Ferguson-Stewart's intent: was the death an intentional suicide or was it an accident? He had no intention of killing himself, so the death was compensable. In a somewhat similar Connecticut case (see above), the overdose was the result of the deliberate (and illegal) act of using a needle to ingest drugs. That case was denied.

Behind every death due to prescription drugs lies a story worth telling. Powerful and effective pain killers are transformed into instruments of death. When it comes to the compensability of these cases, disorientation and confusion are not limited to injured workers experiencing pain. The medical and workers comp systems struggle with the ambiguous legacy of medications: while opioids offer immediate, short-term relief from pain, the relief is followed all-too-often by a downward spiral of addiction and dependency.

I truly wish the testimony of Ferguson-Stewart's widow could be played in the examination room of any doctor about to write a script for an "East Texas cocktail." The doctor just might consider a more benign and less toxic alternative.

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September 6, 2012

 

The Insider has come across an intriguing but ultimately frustrating study concerning the under-reporting of workers comp claims in New Hampshire. Under the auspices of the NH Department of Health and Human Services, the Behavioral Risk Factor Surveillance System survey (with the unfortunate acronym of BRFSS) conducted phone interviews with nearly 7,000 adults who were employed during 2008. About 340 people - close to 5 percent - reported that they had been injured at work sometime during the prior year - injured, that is, seriously enough to require "medical advice or treatment." (Sigh, when you include "medical advice," you might be including the first-aid-only incidents that should be excluded from the study.)

Here is the interesting - if somewhat compromised - nugget from the study. Among those who were injured, only 54 percent reported that their treatment was paid ("all or in part") by workers compensation. The remaining 46% reported their treatment was paid for by private or government insurance (25%) or by other means (21%). Unfortunately, by the time you get down to the 150 people in the non-comp segment, the combination of small numbers and ambiguous questions seriously reduces our ability to draw any meaningful conclusions. The study may indicate substantial under-reporting, but to know for sure, the researchers are going to have to ask some more questions.

Focus on Comp
Because the survey is conducted by the Department of Health and Human Services, the focus on workers comp is, pardon the expression, almost accidental. In fact, the 2008 survey was the first time they included questions about workplace injuries and payment for related treatment. While I applaud their interest in comp, I hope they would consider adding just a few questions to make the survey more effective. Assuming the survey guarantees anonymity, the questions might include:
- For those reporting that they are self-employed, ask whether they carry workers comp insurance (it is optional in NH).
- For those reporting that they were injured, the follow-up questions should be limited to those who secured outside medical treatment (and not those seeking only "advice").
- If comp paid just "part" of the treatment cost, who paid the remainder?
- For any worker whose treatment was not covered 100% by workers comp, ask whether they paid anything out of pocket (which would be a violation of comp law).
- If treatment was covered by a non-comp insurer, ask whether workers were instructed by their employer to report the injury as "non-work related" (employers giving this instruction and employees following it are committing insurance fraud).
- For any workers reporting injuries, ask whether they lost time from work due to the injury and whether they were paid for the time they missed. (Some employers are so determined to avoid the comp system, they pay wages for employees missing time due to injury, even beyond the state's three day waiting period.)

Cost-Shifting?
Lurking in the shadows of this study is the distinct possibility that under-reporting is real and possibly instigated by employers trying to game the experience rating system; they are shifting costs onto forms of insurance that are less loss sensitive. In addition, Injured workers may fear retaliation for reporting legitimate injuries: they may face disciplinary action, may be fired, may be denied overtime or may even ruin the "days without accident" program that dangles the promise of a pizza lunch and drawing for a TV if a certain number of days are free from (reported) injuries.

The BRFSS study provides just enough data to tease us: there may be a serious issue here, but then again, there may be no problem at all. To the good folks in New Hampshire, let this be a word of encouragement. Your study, to put it rather harshly, may be kind of useless in its current form, but with a little tweaking, it might lead to genuine insight into the way injuries are managed in - and possibly diverted from - the state's workers comp system.

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September 5, 2012

 

Hot off the press: Jason Shafrin hosts this week's Cavalcade of Risk #165: Vegas-Style NFL Kickoff Edition at his Healthcare Economist blog - get the best bi-weekly risk roundup in the blogosphere, replete with Vegas style odds!

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September 4, 2012

 

As a belated tribute to Labor Day, we offer a smorgasbord of items about work, worker safety, and some of our favorite tributes to workers.

Celebrating the American Worker
America at Work - Alan Taylor compiles superlative photo essays for The Atlantic's In Focus series. This collection of images from the recent Recession and its years of uncertainty -- of men and women both at work and out of work in the United States.

Earl Dotter, Photojournalist - A remarkable portfolio of work documenting American workers. In the author's words:
"For more than thirty five years the camera had enabled me to do meaningful work. Starting with Appalachian coal miners, and continuing through the years over a broad array of occupations in all regions of the country, I have observed and documented the working lives of Americans. Standing behind the lens, I have celebrated their accomplishments. I seek out those who are taking steps to improve their lives and their effectiveness at work, and use the camera to engage them by giving testimony to their achievements. The images that result tell of the satisfactions their work brings as well as its everyday challenges."

Lost Labor - For more than 20 years, visual artist Raymon Elozua has been assembling a vast collection of company histories, pamphlets, and technical brochures that document America's industrial history. This site features 155 photos from that collection - images of factories, machinery, and laborers hard at work. Many of the jobs depicted have faded into history. The artist grew up in the South Side of Chicago in the shadow of the giant steel mills and factories. His dad worked at U.S. Steel and his first job was at U.S. Steel, triggering a life long interest in everything about these industrial behemoths, from the architecture to the people who worked the jobs within. His interest in documenting this bygone era of American working life was sparked by the demise of the South Works industries.

Worker Safety
Hard Labor - The Center for Public Integrity says: "Each year, some 4,500 American workers die on the job and 50,000 perish from occupational diseases. Millions more are hurt and sickened at workplaces, and many others are cheated of wages and abused. In the coming months the Center for Public Integrity will publish, under the banner Hard Labor, stories exploring threats to workers -- and the corporate and regulatory factors that endanger them."

In particular, we point you to two recent stories:
Fishing deaths mount, but government slow to cast safety net for deadliest industry

Kentucky death case: Another black eye for state workplace safety enforcement

The Best Reporting on Worker Safety - ProPublica compiled "12 pieces of great reporting on workplace safety: from slaughterhouse diseases to lax regulatory oversight and deadly vats of chocolate."

Workers in Popular Culture

From our archives

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