WCDefenseCA

Every business looks for ways to cut expenses – and workers’ compensation insurance is no exception.  So what’s a better way of saving a few dollars than by reporting your roofers as marketers, your truck drivers as mail clerks, and your construction workers as data entry specialists?

And what do we call such efforts?  Resourcefulness? Creativity? Perhaps even efficiency?  The San Bernardino County District Attorney’s Office calls it fraud, and has charged two business owners with felony insurance fraud because of these very efforts, in what appears to be a case of employer-broker collusion to rip off an insurance company.

Sadly, the complaint is a little light on the details, so we can only imagine what the defendants’ are charged with and just how creative they were in (allegedly) stretching the truth as to what their employees actually did.

WCDefenseCA sends its salute to First Comp Insurance for detecting this possible fraud and making sure a case made its way to the DA’s office.  Most times, it is the insurer or self-insured employer that provides the eyes and ears laying the foundation for a fraud case.

So what happens when an injured employee returns to work and the employer can no longer accommodate his or her work restrictions?  Well, in some cases, the injured worker files a lawsuit for Americans with Disabilities Act violations.

The Union Tribune of San Diego reports that a jury awarded David Flores $520,000 of San Diego’s money after finding that the city had violated the Americans with Disabilities Act in firing the city employee.   Mr. Flores, while employed as a mechanical inspector, had sustained an industrial injury in 2006, but had returned to work for the city a few months later.  In 2009, his treating physician imposed a restriction against climbing ladders.

The city couldn’t accommodate the restriction, so Mr. Flores was let go.

But then Flores came back with an ADA lawsuit, claiming that San Diego should have still accommodated him despite a medically-imposed work restriction.

Now, bear in mind, your humble blogger is an even humbler Bay Area workers’ compensation defense attorney.  As such, he knows little to nothing of litigating ADA matters.  But what he is learning again and again is that employers just can’t win in California, and this story is no exception to the rule.

CORRECTION:  Lien regulations ARE effective now.  Good hunting, everyone!

Welcome back from the long weekend!  As we head to the water-coolers, coffee-machines, and breakfast-conference rooms to swap stories of burgers grilled and items purchased at discount, perhaps there is room to say a word or two about liens as well?

The word around the proverbial workers’ compensation water cooler is that the new lien regulations have been distributed to the workers’ compensation judges (but not yet effective).  Beware, lien claimants, your day is upon you!

If this copy of the proposed regulations is legitimate, the new regulations, if adopted in their entirety, will have the following effects (among others):

1. Lien claims can be dismissed as inactive after 180 days;
2. Liens must have ADJ case numbers if the application has already been filed – so lien claimants will have to do their homework!
3. Lien claimants will be required to appear at lien hearings and be prepared to discuss the case.

Hopefully these regulations will take effect soon and we will have the opportunity to take them out for a spin.  As some southern-California practitioners will tell you, past efforts to deal with the lien problem have met with the fatal mark of “local rules.”  State-wide regulations of this sort are a good step towards solving the problem.

Orange County is known for many things.  The trees grow tall, the sun shines bright, and giant oranges roam the streets eating smaller oranges in vicious acts of orange-on-orange violence.  Well, maybe it’s not known for that, but news in the workers’ compensation world spreads fast that Orange County is facing major problems with its workers’ compensation reserves.  The Voice of OC reports that Orange County is now at 60% reserves of predicted workers’ compensation losses over the next 5 years.

Orange County, of course, is self-insured, and the well looked like it was getting dry in early May.  However, Workers’ Comp Executive reports that the O.C., as the kids call it, is moving to boost workers’ compensation reserves up to 80% by moving $2-3 million from other departments over the next five years.

Your humble blogger offers his salute to Orange County for this approach – instead of raising taxes on other employers under the County’s domain, the County is instead dipping into its own pockets to make up the gap – like any employer or insurer would do to stay afloat.

Perhaps Governor Brown could take a lesson from this modest community of former-orange growers in dealing with the workers’ compensation deficit on the state level.

A Flash Report from the Workers’ Compensation Executive, the sister publication of the late, great Appeals Board Reporter, a personal favorite of your humble blogger and a publication deeply missed by the workers’ compensation community, tells us of Governor Brown’s proposal to reduce the budget deficit by reducing the hours of state employees.

Do you remember the furloughs?  Do you remember having a handful of days during the month when the Boards’ doors were [physically] closed to justice and their lights [literally] turned off to the truth (and everything else)?  Perhaps we can expect those days once more.

The proposal includes longer business hours and fewer business days, which doesn’t really help those of us working conventional hours of 9-5.  Even the attorneys and adjusters that actually work longer hours usually reserve the hours before 9 and after 5 to catch up on solo work – reports, paperwork, research, preparing for hearings, and even checking our favorite daily workers’ compensation defense blogs (hint, hint).

What this proposal would provide is a substantial decrease in services (20%) for a tiny decrease in cost (5%).  In other words, the Governor is proposing increasing costs to employers and insurers by 15%

In all fairness to Governor Brown, he was active in vetoing several anti-employer bills and signing several defense (a.k.a. California) friendly bills in 2011.  However, if we overlook the issue of whether the Governor can close portions of the government not funded out of the general budget to “reduce the budget deficit,” your humble blogger submits that, perhaps, the Governor and his administration is taking the wrong tack.

Instead of hobbling the Board offices with a 20% reduction in productivity (let’s be honest here, how productive will you be working 12-hour days when you used to work 8-hour days, especially in those last four hours?) the Governor should be seeking to increase services in workers’ compensation, in quantity AND quality.

With Christine Baker and Rosa Moran enjoying recent confirmation, the efforts should be to make outcomes at the WCAB consistent, predictable, and in accordance with the law.  The various Board venues should be open to provide speedy justice to employees and employers alike – and justice, mind you my dear readers, is not “fairness” or “generosity” with the employers’ capital and the insurers’ reserves.  It is, instead, the correct application of the law without any hooks or crooks.

Instead, with a reduction in services, applicants’ attorney will now be able to threaten the defense community with overworked government employees, delays in closing files, and an overwhelming flood of cases allowing injustice to regularly slip through the growing cracks.  You need a date for that MSC?  Check back in six months.

Come on, Governor, cut the fat, not the muscle, and tighten the guts, not the belt!

A new report from the California Workers’ Compensation Institute states that 2011 has seen a record high average cost of workers’ compensation cases – $66,922.  The website Workforce.com has an article on this, reporting that 2011 saw an increase in the average indemnity costs of each claim.

The short and the long of it is that workers’ compensation costs are going up, steadily and consistently.  The gains made by employers and insurers in 2005 are steadily being chipped away.  The trend, since 2005, appears to be “declining frequency” and “increasing severity.”

Perhaps more reforms are necessary, with a particular focus on lien and medical expenses, to keep these costs from growing any more.  Perhaps practicing workers’ compensation attorneys need to be included in a meaningful way in any reforms that are produced.

Your humble blogger hates to be the bringer of bad news, but it ain’t looking good, folks.

Facebook.  In days like these, we cannot afford to brush it off as just a venue for attention-seekers to document every meaningless aspect of their lives for the world to see.  It is also a great resource for catching fraudsters and plugging workers’ compensation leaks.

There are sophisticated methods of using Facebook to catch injured workers exceeding their “physical limitations.”  For example, you might catch a TTD applicant posting pictures of himself playing basketball, or that spinal injury case might be uploading video of herself doing tricks on a jet-ski.  But sometimes the lies are even more glaring.

Kristi Denise Motty was convicted for workers’ compensation fraud following a two-day trial.  For this case, the deputy district attorney stepped back from the trees and showed the jury the forest – it didn’t matter what Ms. Motty was posting on Facebook; she didn’t need to discuss mountain climbing or bear-wrestling.

While Motty was off work, she entered nearly 200 updates on her Facebook account, even though “it was impossible to write or type” and her pain from doing so was “excruciating.”  Motty worked as an office technician at Corcoran’s California Substance Abuse Treatment.

Motty was also photographed loading textbooks into her car, attending nursing school classes, taking out the trash, texting on her phone, and carrying heavy grocery bags.

WCDefenseCA sends its congratulations to the Tulare County District Attorney’s Office for a job well done!

Are you sick of NFL related posts on WCDefenseCA yet?  Your humble blogger sincerely hopes you’re not, because he has another one for you.  This time, however, the proverbial cross-hairs are on an applicant’s attorney, Mark L. Floyd of St. Louis, Connecticut.  Here is a video the firm apparently put out for Youtube, although the website appears to be down:

So, what could former St. Louis Rams linebacker Jamie Duncan have against Mark Floyd, Esq.?  Well, according to this article from CourthouseNews.com, in 2007, Mr. Floyd advised Mr.  Duncan to sign a settlement for $1,000 which included a waiver of future medical benefits, in a claim filed in Missouri.  (Thanks to KatkeRisk for the article.)

However, when Mr. Duncan retained a California attorney, the California attorney pursued claims for cumulative trauma and reached a settlement of $300,000 for all claims including future medical treatment.  The Rams then realized that a settlement agreement had already been reached in Missouri in 2007.  The parties ultimately settled the California claims for $45,000.

The civil complaint alleges that Mr. Floyd should have explored the option of filing a claim in California.

As if all the other stories on this point were not enough, the threat of being sued by former clients will serve as the drop of blood in the water – applicant’s attorneys from sea to shining sea are going to be going through their rolodex for that classmate from law school who headed out West so long as their client has ever set foot in California.

And you thought the clerks at the Board were busy already…

Have you seen bills for Implantium?  Well, if you have, you may want to hold off before you pay them.  The Santa Clara County District Attorney’s Office has charged Trudy Maurer (CEO) and Tigran Shahsuvarya (Medical Director) with nine felony counts of fraud, the allegations being that the two inflated invoices and submitted them to various government employers in San Jose County.

Shrugging off the medical fee schedule, Implantium allegedly overbilled the government employers for devices implanted (or supposed to be implanted) into injured employees backs.

If your gamble-inclined blogger were inclined to gamble, he would guess that these were more of those spinal stimulators or neural stimulators that work so well during the “trial” phase and then stop working all together after being implanted, requiring additional surgery to remove them.

If these allegations are true, hopefully the District Attorney’s office will not hesitate to throw the proverbial book at the perpetrators.  These parasitic acts bankrupt the workers’ compensation system and hurt tax-payers, employers, and employees alike.

One can also hope that the DA’s office will not hesitate to pursue the same sort of transgressions when committed against private-sector employers and insurers.

As always, WCDefenseCA wishes the District Attorney’s office good hunting!

The reach and influence of your humble (and arguably delusional) blogger spans far and wide.  Reliable sources have pointed out a fraud story that is simply ridiculous.  On January 5, 2012 the San Diego District Attorney’s Office filed a felony complaint, alleging sixteen counts of perjury against Joseph Arthur Wolf.  Wolf, who on at least one occasion testified as an “expert witness” in a lien recovery matter for workers’ compensation cases, made claims that he had received degrees from universities (which he apparently had not), and that he had been mayor of a town in New Jersey (which he apparently had not either).

Among his other claimed titles were: Police Commissioner (of two different towns in two different states), President of the Board of Health, and Assemblyman.  He also claimed to have taught medical doctors at Chicago University Pritzger School of Medicine.

Also of interest is Count 2: “[d]efendant stated he had no financial interest in the outcome of the hearing, but was being paid by the surgery center.”

According to the complaint, Wolf was testifying for Wolf & Associates when these 16 acts of perjury occurred.  But the Wolf & Associates website makes no mention of Joseph Arthur Wolf, but only of Leslie Wolf and her “20+ years experience in the medical and workers [sic] compensation fields.”

Efforts to retrieve cached versions of the Wolf & Associates website, ones that would include some mention of Joseph Arthur Wolf, were unsuccessful.  In any case, it appears that Wolf & Associates provided lien recovery services to various lien claimants, and, on at least one occasion, offered Joseph Arthur Wolf as an expert witness to carry the requisite burden of proof as to necessity and/or reasonableness of charges.

The defense attorney in that case must have been as diligent as they come – he rooted out the patent fraud and perjury committed by this so-called “expert” and the District Attorney is now involved.  How many other lien-recovery outfits try these sort of shenanigans?  How many times have the succeeded in influencing workers’ compensation Judges to award undeserved funds to lien claimants?

As a member of the defense community, I would also like an investigation into Wolf & Associates – did they know about his background? How often have they retained Mr. Wolf as an expert witness?  Are the facts there to support a charge of conspiracy to commit perjury?  California in general and Southern California in particular are plagued by the devastating effect of liens – when applicants are wondering where all the money is going, they can find the lien claimants siphoning off the defendant’s reserves and litigation budget.  This is an example of the problem.

WCDefenseCA sends a very sincere “good hunting” to the San Diego District Attorney’s Office.