CMS Is Requesting for Comments on Mandatory Reporting

As the deadline for implementation nears, The Centers for Medicare & Medicaid Services (CMS) has made a request for more comments on the implementation of mandatory reporting under Section 111 of the Medicare, Medicaid, and SCHIP Extension Act of 2007 (See 42 U.S.C. 1395y(b)(7)&(b)(8)).

Failures at OSHA Put Workers at Risk

A recently released report from the US Department of Labor reports that the past failures of OSHA under the Bush Administration placed workers at risk. The Labor Department's Office of Inspector General released a repot on March 31, 2009 indicating that failure in inspection, training and enforcement led to the unnecessary deaths of workers.

Injured Workers Without Lawyers - A New Concern

A major decline in the participation of attorneys in workers' compensation claims has accelerated what is already a declining spiral in representation of injured workers. This downward swing, in a formerly recession proof industry, raises the concerns as to whether injured workers are now receiving adequate legal guidance.

Attorneys are joining the unemployment ranks in huge numbers. Last week marked the 10,000th attorney laid off from the major law firms in the last 15 months. The US government reports that over 20,000 lawyers are now unemployed. Sadden Arps announced an offer to it entire associate staff to take a year off at one-third pay. The incentive was valued at an average of $80,000.

The workers' compensation system nationally has been impacted by multiple facts that has accelerated an ongoing decline in the representation of injured workers. State systems have been dismantled, co-ordination of benefit issues and medical reimbursement issue have slowed the system and created a reluctancy in filing of claims. Economic issues exist as to whether costs exceed recovery to make claims viable to handle. Uncertainty exists as whether the claims and the demand for representation will bounce back.

The resulting problem is that injured workers will lack adequate formal representation. Injured workers without lawyers raises new concerns that will need to be addressed.

Asbestos Related Diseases Reflecting a Slight Decline

Asbestosis: Number of deaths, crude and age-adjusted death rates, U.S. residents age 15 and over, 1968–2005

Asbestosis deaths among U.S. residents age 15 and over have increased from 78 in 1968 to 1,493 in 2000 and then decreased slightly to 1,470 in 2004. (Ref. No. 2007F01-01, 2007T01-01). Data from the Occupational Safety and Health Administration (OSHA) and the Mine Safety and Health Administration (MSHA) indicate a trend towards lower asbestos exposure levels from 1979 to 1999, concomitant with mandated reductions in the OSHA permissible exposure limit (PEL). However, data indicate a steady increase in asbestos exposure levels in the mining industry for the years 2000 through 2003 and a slight rise in all other industries in the two years previous to 2003. (Ref. No. 2007F01-05, 2007T01-12).

Residents of California, Florida, New Jersey, New York, Pennsylvania, Texas, Virginia, and Washington together accounted for nearly half of all asbestosis deaths in the 1995 to 2004 period. (Ref. No. 2007T01-04).

There were over 15,000 malignant mesothelioma deaths among U.S. residents age 15 and over accounting for more than 200,000 years of potential life lost to life expectancy in the 1999–2004 period. (Ref. No. 2007T07-01, 2007T07-03). For 1999–2004, nearly 20% of mesothelioma decedents were female. (Ref. No. 2007T07-01). Occupations associated with significantly elevated mesothelioma mortality in 1999 include plumbers, pipefitters, and steamfitters; mechanical engineers; electricians; and elementary school teachers. (Ref. No. 2007T07-09).

The Work-Related Lung Disease (WoRLD) Surveillance System, produced by the National Institute for Occupational Safety and Health (NIOSH), presents up-to-date summary tables, graphs, and figures of occupationally-related respiratory disease surveillance data on the pneumoconioses, occupational asthma and other airways diseases, and several other respiratory conditions. For many of these diseases, selected data on related exposures are also presented.

Raptiva® Withdrawn From Market for High Risk of Fatal Brain Disease

Raptiva® users who have experienced neurological changes including unusual weakness, loss of coordination and changes in vision may have claims against the manufacturer, Genentech.

On April 8, 2009, the drug manufacturer Genentech announced a phased withdrawal of the psoriasis drug Raptiva® (efalizumab) from the U.S. market.

Since October 2008, Raptiva® has been associated with a higher risk for progressive multifocal leukoencephalopathy (PML), a rare, and often fatal neurologic viral disease that affects the central nervous system. The associations between Raptiva® and PML are generally associated with individuals with weakened immune systems.

Symptoms of PML may include:
-Unusual weakness
-Loss of coordination
-Changes in vision
-Difficulty speaking
-Personality changes
-Other neurological changes
-Death

There are no known effective therapeutic options for PML, and no known screening tests that can reliably predict PML. The PML infection often leads to an irreversible decline in neurologic and brain function and death. People who live with PML are severely disabled.

The product withdrawal plans to remove Raptiva® by June 8, 2009. According to the FDA, prescribers should not initiate new Raptiva® treatment.. The phased withdrawal is designed to allow patients time to find other effective treatments for psoriasis so as to avoid severe worsening of the condition or hospitalization.

History of Raptiva®
Raptiva® was approved by the FDA in 2003. It is a once-weekly injection for adults with moderate to severe plaque psoriasis.

Genentech began receiving reports of PML among Raptiva® users as early as September 2008. On October 16, 2008, the Raptiva® label was updated to warn of the risk of life-threatening infections, including PML. A Public Health Advisoryinforming patients and prescribers of the risk of PML in patients taking Raptiva® was issued in February 2009, after four patients developed PML, three of whom died. On March 13, 2009, the FDA approved a Medication Guide for Raptiva® and included additional information in the drug's labeling regarding PML.

Further Information
FDA Notice Withdrawal 4/8/2009

FDA Labeling Notice Updated 10/20/2008

FDA Public Health Advisory 2/19/2009

Medication Guide for Raptiva®

Expanding the Long Arm of CMS

Legislation has been introduced in Congress to phase out the waiting period for Medicare over the next 10 years from 24 months to zero. Under the proposal, "......[i]n 2010, it would be reduced to 18 months and then reduced by 2 months each year until January 2019, when it would be totally eliminated."

Such an expansion would expand the involvement of CMS's roll in the workers' compensation program under the Medicare Secondary Payor Act to seek reimbursement.

Medical Bills of Smokers Reported to be Less Than Expected

It has been recently reported that smokers may actually cost society less for medical treatment than non-smokers. The CDC has reported that since smokers die on the average 10 years earlier, their medical costs are actually less to society that non-smokers.

Jordan Barab Named Acting OSHA Chief

Jordan Barab has been named Deputy Assistant Secretary for OSHA and Acting Assistant Secretary effective April 13, 2009. Barab has been an outstanding spokesperson for injured workers and was author of the well known and influential blog Confined Space. Internationally recognized as a stronger advocate for worker safety, his incredible advocacy for a safer work environment has been a hallmark of leadership. 

The AFL-CIO reported:

Peg Seminario, the AFL-CIO’s director for safety and health, says Barab is an “excellent choice” for OSHA deputy assistant secretary. 

He has decades of experience in safety and health working in the labor movement, at OSHA and in the House of Representatives on a broad range of issues. He has a deep commitment and dedication to protecting workers and will bring to OSHA the kind of energy and leadership that is sorely needed to move the agency in a new direction.

CMS Workers' Compensation Mandatory Reporting Teleconference Thursday April 9, 2009

Teleconference Event for Mandatory Reporting for
Liability Insurance (including Self-Insurance), No-Fault Insurance and Workers’ Compensation
Date: April 9, 2009
Time: 1:00 PM – 3:00 PM Eastern Time
Participation is by telephone only. (The Centers for Medicare & Medicaid Services (CMS) will not have space for individuals/entities to participate onsite at CMS).

Call-in Line: 800 779 4354
Pass Code: SECTION 111

Please begin dialing in approximately 20-30 minutes before the call due to the large number of participants.

Click here for Notice and Agenda

AIG Workers' Compensation Under Investigation Again

American International Group Inc. (AIG) is reportedly now under investigation by the insurance regulators of 50 states who are reviewing whether the company violated rate setting rules. AIG in 2006 agreed to a payment of $300 Million in a Federal law suit for mistaking premiums. The company has also been the subject to multiple Federal bailout attempts.

Candy Makers Found to Have Popcorn Lung - Flavoring Illness

It has been reported by, Andrew Schneider, investigative reporter, that severe cases of "popcorn lung" caused by exposure to diacetyl butter are now being reported in candy makers as well. Five cases of severe lung disease have been identified by physicians. Those cases involved workers who made candy.

NJ Issues a Procedural Alert for Medicare Elligible Petitioners

The New Jersey Division of Workers' Compensation has issued a procedural alert to attorneys handling claims of Medicare Elligible Petitioners. Peter J. Calderone, Director and Chief Judge of the NJ agency issued a Memorandum in an effort to establish a formalized and smooth transition with the integration of the mandatory reporting requirements to be initiated this year by The Centers for Medicare and Medicaid Services (CMS).

1. "...parties should not send unsigned settlements to CMS";

2. "...settlements signed by a judge which are not based on a transcribed court record would violate our law since judges must find a settled case resolution fair and just on the court record presented";

3. "Up to date Medicare information must be obtained prior to the entry of a signed workers' compensation order that needs final CMS approval";

4. "When a case is settled, the parties can agree on language in the settlement that a party, usually the petitioner, will be responsible for any additional CMS reimbursements. The petitioner is generally identified since only the petitioner can petition CMS for a waiver from additional payments on hardship or equity grounds. We are advised that such waivers when supported are most often granted;" and

5. "As an alternative, the parties can agree in Orders Approving Settlements (but not Section 20 Orders [lump sum payments in lieu of compensation]) and the judge can insert language in judgments that the parties have the right to reopen the case ifthere are additional Medicare reimbursements and a dispute as to which party is responsible for the payment."

The memorandum goes on to caution the parties that if the parties and the Court are uable to agree upon settlement terms, then a trial and judicial resolution will be required.

Domer on Wisconsin Workers' Compensation Law Published

Thomas and Charles Domer have authored an exhaustive and authoritative analysis of Wisconsin Workers' Compensation Law. Their volume provides excellent practical insight on how to handle the simplest case to the most complex litigation. Wisconsin Workers' Compensation Law furnishes compensation lawyers with historical information and a current analysis of the law. The treatise skillfully identifies trends to aid the practitioner in crafting winning legal arguments in critical and cutting edge issues.

Wisconsin Workers' Compensation Law, 2009 ed. (Vol. 17, Wisconsin Practice Series) By Charles F. Domer, Thomas M. Domer

Petition Filed to Re-Consider California AMA Guide Decision

The California Workers' Compensation Appeals Board (CAWCAB) has decided to review its prior decision of February 27, 2009, challenging the AMA Guidelines. The CAWCAB has issued an Order granting reconsideration and inviting mucus briefs to be filed.

"We also will give any interested person or entity until 5pm on Friday, May 1, 2009 to file an amicus curiae brief and to serve that brief on all counsel in both the Almaraz and Guzman cases."

Alvaraz v. Environmental Recovery Services, et al.

CMS Publishes Memo on Pricing Future Prescription Drug Treatment

The Centers for Medicare & Medicaid Services' (CMS) has published a memorandum outlining the methodology of pricing future prescription drug treatment costs/expenses in Workers' Compensation Medicare Set-Aside Arrangement (WCMSA) proposals.

"The CMS will begin independently pricing future prescription drug treatment costs/expenses in WCMSA proposals beginning June 1, 2009. Effective with complete WCMSA submissions received by CMS’ Coordination of Benefits (COB) Contractor on or after June 1, 2009, where the WC related injury warrant(s) the need of prescription drugs for the ongoing treatment of the WC related injury, CMS’ independent pricing of the prescription drug amount will be calculated and priced using average wholesale price (AWP). The CMS will not use or recognize any other pricing, discounting, or calculation methods when determining the adequacy of the prescription drug amounts in WCMSA proposals. "

US Supreme Court Hears Challenge to Manville Asbestos Bankruptcy Plan

The US Supreme Court once again hear oral argument in a claim arising out of "the longest running tort" in the nation's history, asbestos litigation. The case played to a full house as the Court revisited the 1986 Johns Manville Bankruptcy program and questioned whether the the process that paid out more than $2.8 Billion could be challenged yet again. Plaintiff lawyers, not party to a settlement mediated by former NY Governor Mario Cuomo, argued that they should be allowed to sue various insurers including Travelers Insurance Company.

Travelers Indemnity Co. v. Bailey

Color X-Rays to Beam in on Asbestos Disease

A new radiography technique has been announced to diagnose asbestos related disease. Dr. Michael Harbut, co-director of the National Center for Vermiculite and Asbestos-Related Cancers at the Barbara Ann Karmanos Cancer Institute in Detroit, Michigan reported a new method to assist the diagnose of workers who have been exposed to asbestos, coal dust, beryllium and other heavy metals.

“If we can identify the ’sentinel’ or first cases of asbestosis or lung cancer at an early stage, then we can help identify asbestos exposures in places where it might not have previously been suspected,” said Harbut, who is also chief of the Center for Occupational and Environmental Medicine at Wayne State University.

CMS/MSP Not Going To Require Pre 12/5/1980 Exposure Reporting, BUT....

CMS will not require reporting of claim data where the exposure occurred prior to 12/5/1980 (Effective date of the MSP Act), but if exposure continues after that date, that is another story.

"We were asked about the 12/5/80 date for liability and no fault and the date of incident. Yes we say that in general CMS is determined that it won’t pursue recovery if the date of CMS defined date of incident is prior to 12/5/1980. But then we give an example of a situation with a continuing DOI specifically with respect to exposure.

"If it’s easier for you to think of it that way, if you have a situation with exposure and that exposure continues on or after 12/5/80 it’s really like you’ve got a series of continuous multiple DOIs and we only require you to report the first DOI but yes we do have a recovery claim in that situation.
Transcript of Teleconference 3/24/1980, page 12

CMS/MSP Requires Deceased Beneficiary Information

CMS has announced that workers' compensation information concerning deceased beneficiaries must be reported by insurance carriers.

"We received another question about deceased beneficiaries, were they covered under the reporting; yes they are. If someone is a Medicare beneficiary or was a Medicare beneficiary at any of the time period issue the claim has to be reported if it meets the other criteria."
Transcript of Teleconference 3/24/09, page 5

Death benefits to dependents, are those reportable? Again you go back to what we’ve referenced in the manual where something that doesn’t claim or release or have the effect of releasing medicals with respect to the beneficiary does not need to be reported. But if it does any other those things then yes it needs to be reported.
Transcript of Teleconference 3/24/09, page 12

NY Times Series Calls The Compensation System "A Costly Legal Swamp"

In another of a series of articles, the NY Times highlights the serious procedural and emotional issues involved in navigating the present workers' compensation system.

“This is a terrible thing to say,” said Dr. Robin Herbert, co-director of the occupational and environmental division at Mount Sinai Medical Center, “but if I had a health problem at work, I’m not sure I’d file a workers’ comp claim. It’s the Wild West of health insurance.”

http://tinyurl.com/dyp4c7

Nationalizing Workers’ Compensation Medical Delivery

Recently the Obama Administration invited the medical insurance industry to the White House to discuss possible future scenarios on the delivery of health care. A planted floated at the meeting was one that President Obama advocated in h campaign. That proposal was allow the Federal government to sell health care coverage.

Obama remains committed that employees and employers, as well as the Federal government, should participate in the program. Does that mean that workers compensation insurance coverage is also going to be an element of the plan? The next obvious step would be to allow the Federal government to sell workers’ compensation insurance coverage.

Representative Jan Schakowsky (D-IL), a probable author of the legislations, stated, “We're not trying to figure out what represents the interests of private insurers, we're trying to come up with a plan that makes sure all Americans have health care…”

 The Federal Government is ultimately going to set the stage for the change in health care delivery. The incentive will be the $19 Billion dollars it has set aside for health information technology. Where the road to health care reform takes the ailing workers’ compensation medical delivery system in this era of struggling industrial growth still remains uncertain

Administration in California Requests Judges to Vacate Their Decision Against AMA Guides

California Administration officials have written to the California Appellate Judges and requested that they vacate their decision setting aside the AMA Guides.  The letter, an unprecedented action, has not yet received a response from the California Workers' Compensation Appellate Court.

However, Todd McFarren, a California attorney and President of the California Applicants Attorneys Association, has remarked that the the Judges, will “...still be handcuffed by the administration’s inadequate permanent disability schedule.”  “The administration has not addressed the fundamental flaws in its disability rating schedule. We’ve been waiting more than a year for the governor to approve his own administration’s proposal to restore a small percentage of the permanent disability compensation he cut by 50% to 70%.”

Salaries Frozen for State Workers' Compensation Staff

The national economic downturn continues to impact State administrative services. The NJ Department of Labor and Workforce Development has been prohibited by legislation from raising the salaries of Judges and administrative personnel of the NJ Division of Workers' Compensation for the fiscal year 2009.

The bill directs that no Fiscal Year 2009 appropriations may be used to provide salary increases to workers' compensation judges or administrative law judges, retroactive to January 1, 2009. The legislation provides for an exception if Federal stimulus become available.

"Notwithstanding the provisions of R.S.34:15-49 to the contrary, including the reference therein to salaries of judges of the Division of Workers' Compensation determined as a percentage of the annual salary of judges of Superior Court, beginning on January 1, 2009 there shall be no increase paid from appropriations made herein for an annual salary increase for judges of the Division of Workers' Compensation."

2009 NJ Sess. Law Serv. Ch. 22 (SENATE 15)

Court Holds Autopsy Not Required in Mesothelioma Claim

A New Jersey Appellate Court has ruled that an autopsy is not required in order to proceed with a claim against the manufacturers, suppliers and distributor of asbestos fiber. The appeals court decided that the defendants did not present a sufficient basis to prove that retrieval of lung tissue from the deceased workers' body would lead to obtaining significance evidence for use at trial. It was alleged that the former auto-repair worker had died of mesothelioma as a result of exposure to products containing asbestos fiber.

Furthermore, since the trial in the matter had been scheduled to commence within two weeks of the death of the worker, the Court also held that the trial preparation in the claim was , "... in no way hampered by the denial of their [defendant's] request for a limited autopsy."

Defendants in the claim, including Chrysler Motor Corp and Honeywell International, obtained a Court Order to bar the funeral minutes before the burial of the deceased asbestos worker. On review, following an evidentary hearing, the Appellate Court denied the request by the defendant's for a limited autopsy of the deceased worker.

New Jersey ranks second highest in the nation for asbestos related deaths. Over 10,000 workers each year continue to die from asbestos related disease. Asbestos is not yet banned in the United States.

Harold St. John v. Affinia Group, Inc., et al., NJ Appellate Division, March 3, 2009.

6th Circuit Allows RICO Decision Against Employer to Stand

The Sixth Circuit Court of Appeals permitted its favorable decision for employees and against an employer, its workers' compensation insurance carrier and its examining physician to stand. The Court, on January 5, 2009, denied a Rehearing and a Rehearing En Banc request made by the defendant who were held to be in violation of the Racketeer Influence and Corrupt Organization Act (RICO).

The Court held that 13 original predicated acts constituted a pattern of racketeering activity. The workers were not required to plead or prove reliance on the misrepresentations. The Circuit Court also ruled that the Michigan workers' compensation act did not reverse preempt RICO under the McCarran-Ferguson Act.

Brown v Cassens Transport Co. 546 F.3d 347 (6th Cir. 2009).

CMA Issues an Alert on MSP Reporting Data Extending Testing Period and Setting Thresholds

The Centers for Medicare and Medicaid Services (CMS) has issued an Alert on mandatory workers' compensation reporting extending the permissible testing period through December 31, 2009. They have also issued threshold criteria for “Ongoing Responsibility for Medicals” (ORM) and “Total Payment Obligation to the Claimant (TPOC).”

The Voice of Change in the Medical Care Debate

The Workers' Compensation industry  appears to lack a meaningful voice in the US health care legislative debate. As the interested parties are being tapped by a coalition of Senate leadership for support, the fractionalized workers' compensation industry remains on the sidelines waiting for the opportunity to be asked to dance at the party.

The Henry J. Kaiser Family Foundation reports that Senator Edward M. Kennedy (D-Mass) and a core group of other Senators, including Republicans, have formed a coalition to craft health care legislation. The legislation will be introduced before the August recess.

Based on a report from CongressDaily, it appears that the Senators are forming a coalition of strategic partners  with a variety of economic positions. The target is the introduction of a single bipartisan health care bill. 

This is consistent with reports appearing in The Hill which reflect that a conciliatory approach is being followed by the Obama Administration and the legislative leadership. This creates a very uneasy position for the traditional Republican leadership and the traditional lobbying groups.

The workers' compensation industry now consists of a broad and fractionalized group of stakeholders. They seek  individual economic survival in the current frantic and fearful economy. Their adverse interests have been a huge factor in the expansion of the administrative process and increasing stagnation within the present system. 

As the individual stakeholders find that their interests are being represented individually in a new and non-traditional setting, the need for their economic survival will over power the existing organizational lobbying effort. That lobbying effort was very successful in past decades to defeat legislative initiatives for a universal health care system.

Should this new legislative strategy advance and succeed, the voices of the past will be silenced. The transformation process has already commenced. Public opinion surveys report a majority of Americans want change. It is that voice that will govern the legislative process. This occurred in the  non-partisan outrage over AIG bonuses.  In the end, the process will be successful, for after all, we are a county of " The People,"and it  is their voice that will be the voice of change.