WCDefenseCA

California Workers’ Compensation defense practice offers few enough defenses for self-insured employers and insurance companies to use in resisting claims.  Two such defenses are bars to compensation, available when the injury is the result of horseplay (Hedges v. Workers’ Compensation Appeals Board), or when the injured worker is the initial physical aggressor. (Labor Code § 3600(a)(7).)

[For an interesting case touching on the initial physical aggressor defense, see this post.]

The WCAB recently clarified the proper application of these defenses, although unfortunately the defendant paid the price for this explanation.

In the case of Sergio Nufio v. Bridge Hospital, LLC, applicant and a coworker offered conflicting testimony as to “who started it,” each claiming that the other was doing the name-calling and butt-grabbing.  [Folks – I just report these cases, I don’t make them up.]

Applicant testified that this was not playful on his end, but rather he was being harassed by his co-worker.  Another coworker later testified that applicant was regularly goofing off at work.

Eventually the two decided to settle the matter downstairs in the basement.  Applicant, walking in front of his coworker, was shoved down the stairs, giving rise to the subject injury.

Defendant asserted two alternative defenses, horseplay and the initial physical aggressor defense.  In reviewing this case, the WCAB found that neither defense applied.

The initial physical aggressor defense was not available because the first physically aggressive act, as distinguished from horseplay, was performed by the coworker in shoving applicant down the stairs.

“But wait,” cried the defense, “the first physical act was applicant’s butt-grabbing!” [Again, dear readers, I don’t make these facts up.]

To this the court replied that those acts prior to the stair-shoving were acts of horseplay, and so do not trigger § 3600(a)(7).  And since the horseplay itself did not result in an injury… well, you understand.

So even if applicant was acting like a regular jerk and had it coming, his injury, at least in this case, is still compensable.

In other words, brave readers, if you play with fire, you will get all the benefits ofCalifornia’s Workers’ Compensation system.

Dear readers and brave citizens of California’s Workers’ Compensation system… it’s time for a self-check.  For all the fresh feel and sweet taste this blog offers, one can’t help but be tainted with some residue of that substance known as cynicism.  So, now that you’ve all been reading for so long, it’s time to see if you’ve become borderline cynics like your faithful blogger.

So this is how the test works:  I will lay out some simple facts of a case, and you guess whether the Workers’ Compensation Judge found the injury compensable.

Applicant butcher files a claim for a specific injury and a cumulative trauma, the specific having been allegedly sustained in April of 2009, and the cumulative trauma allegedly spanning the time from April to August of 2009.

The injury was denied by the defendant, and at trial applicant testified that she (1) didn’t remember seeking treatment before August 2009 and (2) didn’t remember reporting the injury or telling anyone about it before August 2009.

Applicant’s supervisor testified that applicant had shown no sign of any injury prior to August of 2009, and that applicant missed no work during that period either.  However, the supervisor also testified that in mid-August, the employer instituted a new policy, prohibiting employees from eating behind the deli counter, and applicant told him that she “felt singled out and that she was going to sue her employer.”

At her lunch break, applicant left work and never came back…

So, dear readers… did the WCJ find the “injury” compensable?  I’m sorry to tell you, you must choose between being wrong or being a cynic.  The WCJ found the injury compensable.

In the case of Denise Hernandez v. Big Buy Food, the Workers’ Compensation Appeals Board granted Defendant’s petition for reconsideration, finding that “the overwhelming weight of the evidence [indicated] that applicant did not sustain an injury.”

Time and time again, experience shows us that California Workers’ Compensation Defense practice requires one eye be kept on the Appeals Board deadlines for filing a Petition for Reconsideration when heading to trial.

The California Workers’ Compensation Institute has a relatively new study out showing a decreased frequency of workers’ compensation claims for private self-insured employers in 2010.  The CWCI does great work, and I previously blogged about a study the institute performed having to do with temporary disability levels.

The study concluded that while claim frequency has fallen, the average claim has risen.  Your humble author has heard, directly and indirectly from people in Human Resources, that employees are becoming more and more reluctant in the filing of actual, good-faith claims.  Of course, the fraudsters and cheats are going to do as they do, but it appears the honest worker is becoming less likely to file a real claim.

In Grinberg logic, this makes sense – jobs are not littering the streets of California anymore; instead they fill the air with their death cries and stain the roads with their treadmarks (usually leading to Arizona or Texas).

So if you can conceal your ankle injury and continue working at your desk, odds are that your personal health insurance will cover the medical treatment and the temporary and permanent disability will run out long before the first paycheck of a new job comes in.

But the important thing to note is that we are, by no means, out of the woods.  Claims are still being made and, as soon as jobs become less scarce, claim frequency will go back up.  And, while the average claim cost will fall when balanced with less serious injuries, the total cost to employers will rise again.

A recent writ denied case highlights the importance of diligently reviewing and thoroughly understanding the medical basis for the opinions of evaluating physicians.

In the case of Daniels v. Workers’ Compensation Appeals Board, defendant petitioned for reconsideration of the Workers’ Compensation Judge’s order and award of 70% permanent disability for applicant’s injury.

The WCJ awarded applicant 65% PD for the orthopedic spine injury and 10% for his alleged psyche injury, combining the two for a 70% award.  One should note that at 70% permanent disability, applicant becomes entitled to a pension, so there is a big step between 65% and 70%.

Because this is a 2002 injury, each party retained their own Qualified Medical Evaluator instead of going through the panel process.  Defendant’s psyche QME found no ratable psyche injury, based on two evaluations and using the 8 work functions of the 1997 rating schedule.  Applicant’s psyche QME, to the surprise of no one, found impairment in all eight of the functions.

However, at trial, cross examination of the applicant revealed that there was little to no impairment to any of the 8 work functions associated with the alleged psyche injury.

Although the WCJ found that the opinions of the defendant’s QME were “better reasoned and more persuasive” than those of the applicant’s QME, using the “range of evidence” in her instructions to the DEU the WCJ achieved a 10% psyche rating, coming to a total impairment rating of 70%.

The Workers’ Compensation Appeals Board granted defendant’s petition for reconsideration, reasoning that applicant’s QME’s report did not constitute substantial evidence, and therefore the WCJ was mistaken in relying on his report.

Often times enough, practitioners in the world of California’s Workers’ Compensation hesitate to roll up their sleeves and deal with the dirty details of medical reporting.  This isn’t always a case of laziness – sometimes there is concern for billing needless hours in a seemingly futile (or slam dunk) case.  The details of the medical reports are where the fighting needs to take place – skipping to the conclusion section will also skip over the best arguments and the best chances of defeating or defending a medical report.

Previously, I posted on a few would-be laws that were headed for the Governor’s desk.  Your humble blogger had expressed guarded hope that bills such as AB 947 and AB 889 would meet a brutal and gruesome death on the Governor’s desk, while AB 378, which would rein in compound drug abuse, would become law.

Well – the Governor is done signing (and not signing) bills, and the results are in!

It looks like AB 947, which would have more than doubled the allowable period for temporary disability suffered Governor Brown’s veto, while AB 378 was signed into law.

As for AB 889, it is still in committee and has not received the Governor’s treatment (yet).

Several other workers’ compensation bills were signed and vetoed, and over the next couple of weeks, I hope to blog on them as well.

But, my dear readers, be aware, that lien claimants should tremble and compound-drug peddlers doctors should tighten their belts: Grinberg, armed with the now-signed AB378, is coming after your liens!

From time to time, your humble author mentions the wonderful defensive maneuver of establishing a Medical Provider Network.  Therefore, instead of recapping the many benefits of the MPN, I will modestly allow my dear readers to click the link and review my old posts on the subject.  But, as beneficial as it, applicant’s attorneys, lien claimants, and applicant-friendly Workers’ Compensation Judges try regularly to chip away at the MPN’s effectiveness.  With that preface, I mention the recent writ denied case of Charter Oak Unified School District v. Workers’ Compensation Appeals Board (Salvador Cerda).

Applicant sought treatment from a doctor within the MPN, but the treatment was administered at a different address, for a different entity, and under a different tax ID number than what was listed in the MPN.  While the case-in-chief settled, the lien claim of the treating physician proceeded on the question of whether membership in the MPN is specific to the treator or to the location/entity.

The Workers’ Compensation Appeals Board found that the membership in the MPN pertains to the individual physician, and a different address/ entity name/ tax ID number does not negate membership.  That decision being made, the lien claimant’s other argument of an invalidly noticed MPN was rendered moot.

In reading this case, it is important to note that the prospect of contracting around the effect of this decision is a promising one.  In establishing the MPN, a contract clause could be inserted to the effect that the treating physicians will only treat at their registered facilities, and not at other offices.

By no means does this negate the benefits of the MPN, but it important to keep our eyes open for further encroachment on the few effective cost-control measures available to defendants.

In California’s Workers’ Compensation system, the standard to establish compensability is fairly low — if you got hurt at work, or your injury is the type that could occur at work, you will likely be compensated.  Most of the fighting in workers’ compensation is really over how much compensation – the deck is usually stacked against the employer from the start of the process.

In this way, the burden placed upon the applicant in the workers’ compensation arena is lower than the negligence requirements placed upon a tort plaintiff.

But a claim for additional compensation for serious and willful misconduct presents a much higher standard (Labor Code § 4553).  In the writ denied case of Flores v. Workers’ Compensation Appeals Board (2011 Cal. Wrk. Comp. Lexis 138), applicant’s efforts to recover under § 4553 did not carry this higher burden.

Flores was a lead mechanic in a tomato cannery and was summoned to the scene of a low pressure steam line that had separated when a clamp came loose.  Ignoring the company safety protocols regarding calling a supervisor to turn off the pipe and giving time for it to cool, Flores went diligently to his repair work until a burst of steam burned his leg.

The theory in this case, which applicant stood firm with all the way to the Court of Appeal, was that his past suggestions, that double bolt clamps be used instead of butterfly clamps to bind steam lines, satisfied the “notice” and “reckless disregard” requirements of § 4553, was rejected by all three courts.  Further testimony showed that butterfly clamps were, in fact, factory recommended for low-steam pipes.

Labor Code § 4553 sets out a relatively higher standard for prevailing on a serious and willful claim, and rightly so.  To justify the conduct that § 4553 seeks to punish and discourage, an employer or its agent would almost have to try or intend to get the applicant injured.

All that happened in this case was what the workers’ compensation system was designed for – Mr. Flores sustained an injury in the course of his duties, and he was compensated generously appropriately.

Fortunately for the tomato canning industry, the Workers’ Compensation Judge, the Workers’ Compensation Appeals Board, and the Court of Appeal all agreed on this last point.

I think it is no secret that lien claimants and their representatives are not all on Santa’s “nice” list.  Some of them engage in what I would call, in an act of unfathomable generosity, ethically questionable tactics.

Often enough, sanctions are not awarded against them (although there are exceptions), and even then not with enough frequency to make the tactics unprofitable.

But then, there are cases like those of one hearing representative, who shall remain nameless.

In this en banc opinion, the Workers’ Compensation Appeals Board ordered a hearing on whether or not this hearing representative should be stripped of the privilege of appearing before the Board.  The WCAB provided a long list of the hearing representatives’ bad faith tactics, including the filing of frivolous petitions, failing to appear, making false statements of fact, and others.  This sanctionable conduct goes back as far as 2003.

Just as an aside, the fact that the first actual sanction was imposed in 2003 suggests to me that there may be other actions which were never sanctioned, inflating the frequency and longevity of this history of conduct.

For eight years, this hearing representative was sanctioned again and again.  A hearing is ordered on this matter and hopefully there will be no more defendants harassed, shaken down, or bullied by this person.  Of course, this can only serve as a personal deterrent to him, taking his ability to do these things away, and somewhat of a scare tactic to others.

Overall, however, the Workers’ Compensation Judges and the WCAB seems reluctant to punish bad behavior on the part of lien representatives (or applicants’ attorneys), so if anything is ever to be done about the unethical amongst us, be sure to contribute to a record to help document who-did-what-wrong.

The Workers’ Compensation Appeals Board recently issued an opinion on a 132a claim in the case of Miller v. County of Alameda (39 CWCR 208).

Miller was a licensed clinical social worker and would drive to see her patients, until she was hurt in a car accident while on one of these trips.  The injury was accepted by the defendant, and Miller eventually returned to work.  The defendant expressed doubts about her ability to continue driving as often as she had before, and told her she needed to find another job.  Miller found an applicant’s attorney instead and filed a claim for 132a.

Labor Code § 132a, prohibiting employer discrimination against employees for filing a workers’ compensation claim (or being a witness in a workers’ compensation case) is covered by your faithful author from time to time.

The reason why this case is important is because of applicant’s theory and its rejection by the WCAB.

Applicant argued that she heard a vague rumor was aware that another employee with a non-industrial injury had stricter restrictions and yet was allowed to keep her job.  The Workers’ Compensation Judge found this to be a violation of Labor Code § 132a, and defendant petitioned for reconsideration.

The WCAB granted reconsideration, reasoning that the vague allusion to some worker, without bringing the worker to trial as a witness, was not enough for applicant to carry the burden of proving a 132a claim.

In other words, the rules of evidence matter at least a little bit, even in the realm of California’s Workers’ Compensation.

A recent article on MarketWatch covered the efforts of the California Restaurant Mutual Benefit Corporation in combating insurance fraud.

The article focused on a solid victory for the self-insured group.  CRMBC’s investigation lead to charges being filed against a former manager of Jack-in-the-Box.  Jeanette Gallo entered a plea of no contest on two counts of felony fraud linked to her workers’ compensation stress claim for a robbery in which she participated.

Fraud is a regular topic for this blog, particularly because of its permanent damage – employers will never recover the money fraudulently obtained; it is always spent long before any charges are filed.  The only remedies are deterrence, which requires the cooperation of law enforcement, and prevention, which can be achieved through the proactive efforts of employers.

Having read the MarketWatch article, I reached out to the CRMBC to find out more about their anti-fraud program.  I was lucky enough to speak with Joe Burgess, the Senior Executive Vice-President at CHSI, the program administrator for the CRMBC.

What he described came across as a practical, thorough, and clearly effective program to detect, prevent, and deter the white-collar robbery of California employers by disloyal and unscrupulous employees.

The program begins with education.  CRMBC’s members are given information on how to investigate fraud and how to properly (read: legally) respond to it.

Joe explained that the first three days following an alleged injury are key – after that, witnesses get forgetful, surveillance tapes get written over, and the physical evidence that would normally poke holes in the applicant’s story gets cleaned, put away and forgotten, as the business stops being a fraud crime scene and returns to being a business.

“The key to success in fighting fraud is immediate, documented investigation by the employer and engagement with the employee,” says Joe.

Members are kept updated by newsflash e-mails, training sessions, and a library of materials on the membership website.

The next phase is the bigger investigation, which covers the applicants using surveillance and background checks, and the providers, making sure they are actually performing the services they are billing for (unlike some providers we’ve heard of).

The final stage is the deterrence, which includes cooperation with law enforcement to see these cases prosecuted and the fraudsters convicted.  But, as any prosecutor will tell you, the best evidence on which to build a case would probably have been collected by the employer at the time of the alleged “injury.”

But the value of the program is not in the final step, says Joe: “Success in fighting fraud is not measured in arrests and convictions – those are not that common.  Success in fighting fraud is fewer serious indemnity claims – because  the employer puts processes in place such as rapid response, good initial investigation, [and] engagement with the employee.”

Fraud is a parasitic plague which saps the strength of the workers’ compensation world.  To stop these ticks in their tracks, employers must become their own guardsman – the employers are the best situated to take the lead here.

As Joe puts it, “we can control what we do, not what others do – but by creating the right structured environment we can make it less likely that fraud will flourish.”