Injured Workers Assert Class Action Claiming Wal-Mart Violated RICO Act

Several injured Wal-Mart workers' have claimed that the company, in defending their workers' compensation claims, violated the Federal RICO Act. The employees of Wal-Mart have alleged that the company conspired with the insurance carrier and claims adjuster to "dictate, withhold, delay, deny and/or interfere with" the type and duration of their medical care.

The employees have filed a motion for class action certification in their Federal RICO claim against: Wal-Mart, Concentra Health Services, Claims Management, Inc. and Home Assurance Co. (the workers' compensation insurance carrier). The complaint alleges the defendants' activity violated the Colorado's Consumer Protection Act [Colo. Rev. Stat. Section 6-1-105(1)(b),(c),(e) and (u)], and that there were also violations of the federal Racketeer Influenced and Corrupt Organization Act [18 U.S.C. Sec. 1961-1968.] The Class Action Complaint was filed on March 24, 2009. Gianzero v Wal-Mart Stores, Inc. , et al., US DCT (D. Colorado) No. 09-cv-00656 REB BNB.

Wal-Mart's workers' compensation has been critically reviewed in the Seattle Weekly. The publication indicates that the Washington Department of Labor and Industries, in an Order, indicated that, .... “Over the last seven years, Wal-Mart has “repeatedly and unreasonably” delayed giving injured workers the benefits they were owed under workers’ compensation laws, and, in some cases, Wal-Mart employees were not allowed to file workers’ comp claims at all.”

The expansion of RICO actions arising out of workers' compensation claims is an issue to be addressed by the US Supreme Court should two pending Petitions for Certiorari be granted in other pending matters. See the Workers' Compensation Blog for additional articles on this topic.

Medical Provider Claims Viable RICO Action Against Insurance Company in Petition to US Supreme Court

A Petition for Certiorari has been filed to the US Supreme Court in a RICO claim involving a medical provider who claims an insurance company committed fraud in processing the provider's bills for services. George Schroedinger, MD has filed a Petition to seek review of a Eight Circuit decision that over turned a favorable RICO action against United Healthcare of the Midwest, Inc.

The medical provider alleges that United's computer system "often inappropriately grouped and down coded, improperly suspended claims, unnecessarily requested plaintiffs claims that United continued to classify" the medical provider.

This Petition follows a Petition for Certiorari has been filed in Brown v. Cassens Transport Co., 546 F.3d 347 (6th Cir. Oct 23, 2008) (NO. 05-2089), following the rehearing and rehearing en banc denied (Jan 05, 2009). Brown is a landmark decision of immense national significance, the US Sixth Circuit Court of Appeals ruled that a RICO claim brought by injured workers against their employer, insurance carrier and employer medical expert could proceed. The Brown case is scheduled for a Supreme Court conference on September 29, 2009.

George Schoedinger, et al., Petitioner v. United Healthcare of the Midwest, Inc, No. 09-80 (July 16, 2009)

NJ Proposes Informal Process for Medical Bill Disputes

The number of disputes concerning the payment/reimbursement of medical bills have increased in workers’ compensation claims in New Jersey. The State has proposed converting the Informal Hearing procedure into a new Informal Process to hear such disputes and other matters previously consider as an Informal Hearing.

In a published article, “ Clearing the Workers’ Compensation Benefit Highway of Medical Expense Land Mines ,” the difficulties of the issue were previously identified. “Medical expenses in contested workers’ compensation cases are now a significant and troublesome issue resulting in uncertainty, delay and potential future liability. The recent NJ Supreme Court decision, University of Mass. Memorial Hospital v. Christodoulou, 180 N.J. 334 (2004) has left the question of how to adjudicate medical benefits that were conditionally paid or paid in error. Presently there is no exclusively defined procedure to determine the allocation, apportionment of primary responsibility for unauthorized medical expenses and reimbursement.” “The new benefit highway that embraces a new paradigm which extends to a new
safety net and the existence of these collateral programs require a modification of the
Workers’ Compensation Act and/or Rules to safeguard the interests of the parties, while
remaining consistent with the social remedial intent of the legislation.”

Previously legislation was proposed that would have given the NJ Division of Workers Compensation exclusive jurisdiction over medical bills. A-2501 That legislation was never enacted.

The proposed process would allow medical providers, or their representatives, to appear, without the need of an attorney, to informally discuss their disputes with the parties in an effort to seek a consent agreement for resolution. The proposed rule also repeals the need for registration of party representative.

The proposed rules were published on Monday, July 20, 2009 (41 N.J.R. 2768(a) and a public hearing is scheduled on Monday, August 17, 2009 from 9:00 to 12:00 noon NJ Department of Labor and Workforce Development, Trenton, NJ.

Overseas Workers Not Covered by State Mandated Workers' Compensation Insurance

In a novel decision the New Jersey Appellate Division ruled that overseas employees are not entitled to coverage even though the workers' compensation act in New Jersey mandates compensation insurance for all employees. The court, utilizing the full faith and credit doctrine, rationalized that insufficient contacts existed between the State of New Jersey and the employees to require insurance.

The employer, a corporation headquartered in NJ, whose business was to employ volunteers to work overseas in an educational program, made an inquiry to the New Jersey Compensation Rating and Inspection Bureau (NJCRIB) for a determination as to whether or not coverage should be afforded to the employees who were based outside of New Jersey, not hired in New Jersey, and not actively engaged in the employment of the respondent in New Jersey. After the NJCRIB notified the employer that insurance was required, the employer sought a declaratory action and judicial interpretation.

International School Services, Inc. v. NJ Department of Labor and Workforce Development, ___ A2d _____ Docket No. A-5722-07T3 (App.Div. 2009). Approved for publicatoion July 10, 2009.

Declining Salaries and Unemployment Challenege Workers' Compensation

The decline of wages is yet another major factor in the determination of the health of the workers' compensation system. Recently released surveys reflect that the increase in salaries is the lowest in decades.

The US Department of Labor has reported that the average workers' salary has only increased 2.2% in last year. The demonstrates a fall of 3.2%.

Most workers' compensation systems are based upon the Sate Average Weekly Wage (SAWW). The SAAW establishes the limits for benefit payouts. Usually States mandate that both minimum and maximum payments are a percentage of the SAWW. Compounding that predicament is the fact that the recession has eliminated 6.5 million jobs since 2007.

Both higher levels of unemployment and a reduction in salary increases impact have a fiscal impact of the workers' compensation system. Wages are the basis for the calculation of premiums collected. Few employees and lower wages reflect in lower incomes for insurance companies.

Of course lower employer gives rise to declining claims and lower salaries give rise to lower rates. However, medical costs, the driving force in workers' compensation continue to rise. As the economy continues to decline and fewer businesses remain afloat, the challenge to keep the workers' compensation system afloat will become more acute.

Hot Topics in Workers' Compensation 2009 Seminar

Wednesday, October 07, 2009 5:00 PM to 9:00 PM New Jersey Law Center, New Brunswick

This seminar will provide practitioners with new strategies and techniques to handle workers' compensation cases in the changing economy.This fast-paced program features a panel of some of the most respected New Jersey Workers' Compensation Judges and attorneys, who will review and provide insight on the top issues and cases that have emerged during the past year.

As an attendee, you’ll pick up practical pointers that have proven successful in matters ranging from jurisdictional issues through coverage of employment. The program will expand your horizons and broaden your practice potential into expanding in developing areas of the law. Make plans to register today!

Program Agenda:
• The New Rules For Preparing, Defending and Processing Motions For Emergent Medical Care That Require A Showing Of “Irreparable Harm.” - Hon. Peter J. Calderone

• The Standard Of Proof Required To Establish Liability In A Multiple Employer And/Or Successive Insurance Carrier Orthopedic Claim - Nancy J. Johnson, Esq.

• Differences Among Jurisdictions in Cash Benefits - Professor Emeritus John F. Burton, Jr.

• What Should Be Considered In Addressing Injured Workers’ Needs For Adapting A Home As A Barrier-Free Environment - Jerome L. Eben, AIA. PP. CID

• The Evidence Burden Required To Successfully Establish Compensability In A Claim Involving Secondary Fragrance Exposure In The Workplace - Kenneth A. DiMuzio, Sr., Esq.

• How And When An Employer Or Subsidiary Can Assert A Lien On Settlement Proceeds From A Third Party Recovery - John J. Jasieniecki, Esq.; James Jude Plaia, Esq.

Moderator:

JON L. GELMAN, ESQ.

Author: “New Jersey Workers’ Compensation Law” (3rd Ed., Thompson-West) Law Offices of Jon Gelman (Wayne)

Speakers include:

HON. PETER J. CALDERONE

Director and Chief Judge, Division of Workers’ Compensation (Trenton)

JOHN F. BURTON, JR.

Former Chair, National Commission on State Workmen’s Compensation Laws Professor Emeritus, School of Management & Labor Relations (SMLR), Rutgers University (New Brunswick)

JEROME L. EBEN, AIA, PP, CID

Past President, New Jersey Society of Architects Jerome Leslie Eben - Architect (West Orange)

JOHN J. JASIENIECKI, ESQ.

Green, Jasieniecki & Riordan (Florham Park)

NANCY J. JOHNSON, ESQ.

Certified by the Supreme Court of New Jersey as a Workers’ Compensation Attorney Weston, Stierli & McFadden (Piscataway)

(at New Brunswick)

JAMES JUDE PLAIA, ESQ

Offices of James Jude Plaia (Verona)

KENNETH A. DiMUZIO, SR., ESQ

Hoffman DiMuzio (Woodbury)

Click here to print paper registration form. Register online Tuition fees Reg. Fee Reg. Type Early Registration Discount! Register by 8/14/09 $119.00 EB General Tuition $169.00 REG NJICLE Season Tickets 1 Season Ticket(s) STX MEMBERS, NJSBA Co-Sponsoring Section $125.00 COS MEMBERS, NJSBA $135.00 NJB MEMBERS, NJSBA YLD $125.00 YLD Recent admittees (last 2 years) $145.00 YL Paralegals $115.00 PAR Law Students (with Student ID) $0.00 STU Full Time Judges $0.00 JUD Credit Type Credit Amount CT or CrT: 3.75 credits pending WCM: 1.0 credits PAS: 2.5 ($16 fee for all PA credits) PAE: 1.0 (Included in PA credit fee) NYP (t&n/t): 3.5 credits NYE (t&n/t): 1.0 credits MG: 2.75 credits pending MP: 1.0 credits pending WCG: 2.75 credits DOOR REGISTRATIONS: $189 Advance registration closes at noon of the day preceding the program. After that time you may still register, space permitting, for the Door Registration Fee. PLEASE CALL FIRST to confirm the seminar schedule and space availability. * NJSBA Member Price – To qualify for this reduced price, you must provide your NJSBA Member# at the time you place your order. If you place your order without providing your NJSBA Member#, you will be charged the regular price. Cancellation policy Presented in cooperation with The New Jersey Society of Architects CAN'T ATTEND? HOT TOPICS IN WORKERS' COMPENSATION LAW 2009 Seminar Materials and Audio Packages More Details New Jersey Institute for Continuing Legal Education The non-profit continuing education service of: The New Jersey State Bar Association Rutgers - The State University of New Jersey Seton Hall University One Constitution Square, New Brunswick, New Jersey 08901-1520 Phone: (732)214-8500 Fax: (732)249-0383 • CustomerService@njicle.com

NJ Employer Indicted for Failing to Have Workers' Compensation Coverage

A NJ employer who failed to have workers' compensation insurance was criminally indicted the NJ Attorney General announced. The owner of Accurate Paving, Mack Setvens, was alleged not to have insurance coverage.

The NJ Uninsured Employers' Fund (UIF) is required to make payments to injured workers when no coverage is maintained by the employer. In this instance the UIF paid $253,000 in payment to the injured worker.