Archive for January, 2007

Working Beyond the Grave: Dependent Benefits in Missouri

Wednesday, January 31st, 2007

There are many ambiguities in the world of workers comp. (Without them, there might not be a need for this blog.) So today we find ourselves in Missouri, the “show me” state, where the state’s supreme court shows us how a dead man can be available for work.
The case involves Fred Schoemehl, a 62 year old man who suffered a work-related knee injury in 2001. He was eventually awarded permanent total disability, but unfortunately, one month after the award, he died of causes unrelated to the work injury. In most states, a deceased employee’s dependents will collect benefits if the death is work related. Otherwise, the benefits cease with the death of the employee. The assumption, even in the case of a permanent total disability, is that the dependents are entitled to benefits as long as the employee is at least theoretically “available for work.” Upon Mr. Schoemehl’s death, that availability ended. When Fred died, the dependent benefits to his wife, Annette, ceased.
She sued. Fred was dead, but Annette still was dependent upon his income. The court writes: “Until this case, no Missouri court had determined whether the right to compensation for the permanent total disability of an injured employee, who has died from causes unrelated to the work injury, survives to that injured employee’s dependents.” A majority of the state Supreme Court found in Annette’s favor. They determined that she is technically “an employee” – citing section 287.020.1 of the workers comp law, which provides that “any reference to any employee who has been injured shall, when the employee is dead, also include his dependents….”
So, Annette, who was not a disabled employee, continues to receive the indemnity benefits of a permanently disabled worker.
Judge Stith dissented from this finding:

The disability at issue here was an injury to Mr. Schoemehl’s knee. That injury necessarily discontinued upon his death. Even if the second prerequisite to payment under section 287.200.1 — continuance of the employee’s life — is met by reason of section 287.020.1’s inclusion of dependents in the definition of “employee,” the first prerequisite — continuance of the disability — is not satisfied. Therefore, upon Mr. Schoemehl’s death, neither he nor his dependents were entitled to continued permanent total disability payments. Accordingly, Mrs. Schoemehl is not entitled to receive compensation for permanent total disability benefits beyond that already accrued to Mr. Schoemehl at his death.

Predictably, insurers and business advocates are upset with this decision. Gary Marble, president of Associated Industries of Missouri, sees a troubling precedent, where any and all dependents of diseased disabled workers will now file for continuation of benefits. “Basically,” he says, “if not corrected, the workers compensation system has been relegated to a life insurance policy in addition to the legally mandated coverage for injured workers. The system simply cannot support this additional cost.” Needless to add, such benefits are not contemplated in current Missouri rates.
The ambiguities in the Schoemehl case disappear when a worker is killed on the job or dies from work-related causes. In these sad cases, the dependents are unambiguously entitled to benefits, as long as they meet the legal definition. Children lose eligibility when they become adults. Widows and spouses secure lifetime benefits, unless, of course, they choose to marry.
It will be interesting to track the impact of this ruling on Missouri claims. The state legislature may choose to respond to the business lobby and change the law to eliminate the ambiguous definition of “disabled employee.” Short of that, the “show me” state has opened the door to a new level of benefits. This approach is certainly humane, if not exactly what most people have in mind when they think of paying workers indemnity for the specific times they are at least theoretically available for work, but unable to do the job.

Linkapalooza – new tools and resources

Tuesday, January 30th, 2007

Here are a dozen new links ranging from safety resources to tech tools. We’ll be adding most of these to our sidebar, where we have collected an ever-expanding array of organizations, publications, resources, and tools – check them out!
Florida Agsafe – a great resource page of agricultural safety and disaster information from the Agricultural and Biological Engineering Department of the University of Florida and The Institute of Food and Agricultural Sciences.
Workers’ Comp Executive – published 22 times per year and is the journal of record for the workers’ comp community in California.
Cal-OSHA Reporter – a Weekly Publication For The Occupational Safety & Health Community
Appeals Board Reporter – California workers compensation legal publication featuring up to the minute cases, objective status and reviews, a place to research issues and much much more.
Risk Manager’s Guide to All 50 States – links to state offices relevant to risk management.
Employer state labor posting requirements – a handy reference list.
State health facts – a resource from the Henry J. Kaiser Family Foundation designed to provide free, up-to-date, and easy-to-use health data on all 50 states.
Business Pandemic Influenza Planning Checklist – the Department of Health and Human Services and the Centers for Disease Control and Prevention developed this activities checklist to help large businesses be prepared for a pandemic or other emergency.
I want a freeware utility to… – 450+ free utilities to solve common problems and save money.
Periodic table of visualization methods – planning a report, training session or presentation? This handy chart will help you to think through data, concept, and information presentation.
Research Beyond Google: 119 Authoritative, Invisible, and Comprehensive Resources – research like a librarian using a variety of alternative search tools.
Common errors in English – an alphabetical list of common goofs.

Working at Home: Employees or Contractors?

Monday, January 29th, 2007

Over 12 million American workers perform their jobs away from the office: many work out of their homes, perhaps commuting occasionally to the office for mandatory meetings. The benefits of working at home are pretty obvious: you can set your own hours (at least to some degree); you don’t have to worry about traffic and bad weather; and no one cares how long you take for a coffee break. No wonder so many people prefer this work option. It’s a no brainer.
Well, the no brainer has become a brainer. We read at that class action lawsuits have been filed in California, Colorado, Missouri, New Jersey, New York and Ohio. The suits allege that at-home work arrangements violate basic labor laws: no pay for overtime work; no severance pay; no travel reimbursement for mandatory trips to the office; and no pay for being on “stand by” while computers are down. The fundamental issue is the nature of the employer-employee relationship. Are at home workers subject to overtime and related regulations (“non-exempt”) or more like supervisors and managers (exempt from these regulations)? Most employers assume that these employees are exempt, simply by the nature of their workplace. But that’s not necessarily the case.
It’s deceptively easy to view at-home workers as “independent contractors” because they function, well, independently. The distance from the customary worksite leads to ambiguity. Nonetheless, home employees are still employees, whether exempt or not, and companies should take steps to clarify their status. That means treating at-home workers the same as worksite-based employees. Not treating them identically – that is simply not feasible – but establishing clear and explicit groundrules, preferably in the form of a written agreement. The optimum time for doing this, of course, is before the work at home begins:
: develop timesheets which document hours on task (these can usually be incorporated into the log on /log off process)
: require approval for any proposed overtime
: set ergonomic standards for at-home workstations (see below)
: clarify in writing the benefits available to at home workers, including travel reimbursement, sick leave and severance pay (Be prepared to explain any differences in the benefits involving commuting employees)
: outline the explicit criteria for exempt and non-exempt employees, so the at-home worker understands his or her status
Workers Comp at Home
Then there is the subject near and dear to the Insider’s heart: the status of workers comp coverage for at home workers. Employers might be tempted to exclude at home workers from this benefit, but this is not an option. The payroll for at home employees gets rolled into the workers comp premium calculation. Employees are covered by workers comp while they are “in the course and scope of employment.” In other words, they are covered while working at home, even if they set their own hours and despite the fact that they have no direct supervisors. This raises some intriguing issues: what if I slip and fall or trip over a box in my home office? What if my work station is ergonomically risky? What if I burn myself making a cup of coffee? What do I report to my manager and how?
There are no easy answers here. But one thing is sure: with over 12 million at-home workers, work-related injuries are going to occur. The “work at home” culture – with its many benefits – will continue to grow. At the same time, management needs to learn how to manage employees who are definitely out of sight, but, one hopes, not out of mind.

Wonk! Wonk!

Thursday, January 25th, 2007

The latest edition of Health Wonk Review, hosted by Jane Hiebert-White at Health Affairs, is up. Jane has done a terrific job of weaving together many disparate threads, all timely and all resonating with interesting implications for risk management, insurance, business and government. There are plenty of viewpoints among the talented participants. Whether your interest is national and state policy, big pharma or fundamental cost controls, this posting is a great place to begin. Health policy rocks! Check it out.

Comp in New York: Death Spiral Finally at an End?

Thursday, January 25th, 2007

Workers comp seems to embody the worst of all possible worlds in New York state: the benefits are way too low; the premiums are way too high. The system is full of friction, with virtually every claim decision requiring the involvement of a judge. The system, forged in the cauldron of early 20th century labor-management conflicts, is in deep trouble.
New York has always been a high cost state. With California and Texas cutting costs through dramatic reforms, New York might be duking it out with Florida for the dubious title of Number One: highest comp costs in a major industrial state. The cost of comp has become a political issue, with newly elected Governor Elliot Spitzer weighing in. Spitzer concedes that the system fails everyone: “the employers who pay some of the highest premiums in the country…and the workers who receive some of the lowest benefits.”
The Payroll House of Cards
There is one aspect of the problem that fits readily into Spitzer’s comfort zone: rampant fraud. We read in the New York Times that premium fraud has reached an unprecedented magnitude in the Empire State. The Fiscal Policy Institute estimates that employers are avoiding payment of somewhere between $500 million and $1 billion in premiums – 15 percent to 20 percent of all premium in the state. (The premium avoided exceeds the premium paid in most states!)
The institute compared total employee payroll reported to the Labor and Tax departments – $389 billon – to the payrolls reported for workers comp. The comp payroll came in around $311 billion. That means that New York either has the largest concentration of independent contractors on the planet – or employers are under-reporting payroll to their comp carriers.
Interesting to note, we recently blogged the fraud charges against Cover-All, a huge contractor in California. Their scam was uncovered with the same simple methodology used in New York: payroll tax records compared to payrolls reported for comp. You would think in this age of the computer that such comparisons would become the norm.
As is usually the case in rampant fraud, it is the legitimate, law abiding companies in New York who are paying the price – in the form of very high costs (and mediocre benefits) for their mandated coverage. Injured workers are going to receive benefits, regardless of whether their employers paid all, part or none of the comp premiums. As the costs associated with premium avoidance are shifted to the fully insured employers, their cost of doing business keeps going up. That, in effect, is the comp death spiral.
In some respects, the solution to New York’s comp problem is simple : First, update the state’s comp law, procedures and benefits to bring them in line with the twenty first century. And second, establish a credible enforcement effort to crack down on wide-spread abuse. It won’t be easy, but as California and Texas have shown, it can be done in a relatively short time. All that is needed is a sense urgency – a sense that the current mess must not be allowed to continue. Given that the system is so unfair, inefficient and wasteful, reasonable people should be able to achieve the necessary reforms in the proverbial New York Minute.

State Farm is (finally) There

Wednesday, January 24th, 2007

We read in the New York Times that State Farm has suddenly agreed to accept liability for many of the claims it had previously denied in Katrina-ravaged Mississippi. The giant insurer has set aside a minimum of $80 million to settle 640 lawsuits. They have also agreed to re-open 35,000 denied claims. In most cases, home owners will collect half of the policy value. In a few cases, they will cash out at full value.
This is a dramatic turnaround from the insurer’s prior position: they based their initial denials on the premise that most, if not all, the damage from Katrina was caused by storm surge (flooding is not covered by conventional homeowner’s insurance) and not by wind (wind damage would be compensable). In the final analysis, I doubt that they are backing away from the scientific premise of their denials. They still probably believe that they are on solid legal ground for denying the claims. No, in the end, State Farm has agreed to pay claims it really feels are not compensable for one simple reason. They are still in the insurance business. They still want to sell policies. And the negative fallout from their routine denial of Katrina claims threatened their core reputation, the brand name they have so carefully cultivated over the years.
The Times article quotes Randy Maniloff, a lawyer at White & Williams in Philadelphia who represents insurance companies. He said yesterday that it was clear that the bad publicity had been a big factor in State Farm’s decision to settle. “They spent 80 years building up a brand,” he said, “and the adverse publicity from these lawsuits has been clearly doing damage to the brand. It just flies in the face of their portrayal of themselves as good neighbors.”
When we first blogged this issue, we raised the irony of State Farm’s “good neighbor” tag line. Real neighbors help out regardless of the circumstances. In contrast, corporate “good neighbors” might well use the small print of an insurance policy to serve stock holders and maximize profits. If that means boarding up entire communities, so be it. There is at least some legitimacy to State Farm’s original position. The case can be made that this capitulation is wrong and sets a dangerous precedent for the industry. Other carriers now have to scramble to recalculate their earnings statements. In addition, all purveyers of home owners insurance are revising policies to clearly and explicitly exclude storm surges from future coverage. But they are all going to help pay for Katrina.
Business and The Public Good
The scale of this disaster was so great, it transcends the insurance industry itself. While insurers are extremely reluctant to compromise the sacred language of the policy, they are involved here in something much greater than corporate bottom lines. Entire communities have been wiped out. The scale of displacement caused by Katrina is unprecedented in American history. State Farm’s settlement is a small part of a great public good. As a result of this agreement, desperately needed cash will begin flowing at long last into the devastated communities. The rebuilding will finally gather some momentum. At the same time, State Farm can credibly tout itself again as a “good neighbor.” Not the most willing, perhaps, and not entirely convinced they want to be doing it. Nonetheless, for the people of Mississippi, State Farm, like a good neighbor, is finally there.

News roundup: compensable harassment, Bush health-care, Iraq vets, new blogs, and more

Tuesday, January 23rd, 2007

Unwelcome sexual advances factor into compensability award – Judge Robert Vonada of PA WC blog points us to the a recent PA Supreme Court decision that awarded workers comp to a miner based on sexual harassment that aggravated the claimant’s pre-existing PTSD. (RAG (CYPRUS) Emerald Resources, L.P. v. WCAB (Hopton), Appeal of: Ronald A. Hopton) The unanimous decision by five justices reverses a Commonwealth Court ruling, which had denied benefits to the claimant. in it article Pa. High Court Rules Unwanted Advances Are Abnormal Working Conditions, offers more details on the case.
A Bush health-care proposal – Joe Paduda offers a preview of a major new health-care initiative that will be announced by Bush in tonight’s State of the Union speech. Joe’s assessment in a nutshell? “The hole in the US health care insurance and delivery systems is way bigger than the patch provided by Bush’s plan.”
Iraq vetsThe New England Journal of Medicine features a grim but excellent photo essay on Caring for the wounded in Iraq – be warned, the photos are graphic. Medical advances are keeping more vets alive, despite profound injuries. These are the vets that will be returning to the work force.
A dim view of mandatory arbitration – In Mandatory arbitration: stupid employer tricks, attorney Jay Shephard of the delightfully-named blog Gruntled Employees discusses the reasons why employers may want to consider mediation rather than compulsory arbitration as a method of alternative dispute resolution. In reading this piece, we can see where such an agreement might also factor negatively into workers comp negotiations.
Cheer up – you made it through Blue Monday. We learn from Management Issues that yesterday was the most depressing day of the year:

“Cardiff University psychologist Dr Cliff Arnall has singled out today on the basis of a mathematical equation where [W + (D-d)] x TQ M x NA where W = weather, D = debt, d = money due in January pay, T = time elapsed since Christmas, Q = time since failed New Year’s resolutions to quit smoking, drinking etc, M = general motivational levels, NA = the need to take action.”

If it quacks like a duckThe Museum of Questionable Medical Devices catalogs medical quackery throughout the ages.
New weblog discoveries
Ergonomics in the News – a good blog featuring a variety of ergonomic-related posts, such as Confronting driver distraction and The Aging Workforce – Physical Changes Require Ergonomic Intervention
Employment Law Colorado is the blog of attorney Peter Mullison. A sampling or recent posts include On the job injuries and Colorado Posting Requirements. Mullison offers a free copy of the American Bar Association’s new book Guide to Workplace Law in exchange for the best employment law questions submitted by the end of the month.
California Employee Rights Blog – is a blog by attorneys James J. Peters and Sara R. Peters. A sampling or recent posts include Terminated while on FMLA and “Side Effects” of California’s new minimum wage law.

The weekly toll: death at work

Monday, January 22nd, 2007

Every other week, our blog neighbor Tammy at Confined Space compiles a list of news stories about workers who have lost their lives at work. We’ve linked to it before. Despite its length, it’s only a partial list at best- whatever manages to turn up in the search engines. The roster makes for some chilling reading. No matter how many times I’ve read these lists before, I am almost always jarred to see how many deaths occurred in my state – sometimes, just a town or two away. I am also struck by how pedestrian the circumstances sound – on a golf course, in a restaurant, at a market, on a farm. I guess it’s the human tendency to think these things occur in far away places, at different kinds of work sites.
There’s no doubt – some industries are infamous for their associated danger. The year starts off with three mining deaths, one in Colorado and two in West Virginia. And public servants like police and firefighters are often high on these lists, killed in the line of duty. This week’s list also seems particularly violent – from cab drivers and store clerks killed in robberies to managers of a strip club gunned down by a patron and a pastor shot on the steps of his church. There are vengeful killings too – a postal manager killed by a disgruntled worker, a newspaper ad rep chased down and shot by an estranged spouse.
But while this violence is striking, the quiet tragedy of the ordinary worker struck down on an ordinary day under ordinary circumstances is perhaps more jarring. It’s frustrating to read the list and see “the usual suspects” of highly preventable deaths occur again and again. I don’t think I’ve ever read one of these lists that doesn’t have a trench death or two or several falls from heights. And there are also the very gruesome accounts of workers pulled into a shredder, a worker pinned in machinery, and a worker yanked into an industrial drill after being ensnared by his clothing – terrible, sad stuff.
The toll on survivors
In story after story, the reports from co-workers are heart-wrenching – witnesses to the carnage, some after having frantically fought to save a colleague. It must be terrible to have to return to a job after having witnessed a beloved coworker die. It must be a heavy burden for coworkers and supervisors, and should they actually bear some negligence in the events, it could be soul crushing. Indeed, a year or two ago we noted the deaths of roofing workers on a construction site in Florida. There had been numerous safety violations, and in following up to see the criminal disposition, we learned the owner of the contracting company had taken his own life – no doubt, the horrible events played a role in his death, too. He and others paid a steep price for whatever corners were cut in shortchanging safety.
If you are reading Workers Comp Insider, it’s likely you have some vested interest in the workplace. Whatever it is that you do and whoever it is that you are, I encourage you to set aside a few minutes to read through this list. For those of us “in the industry,” preventing such everyday tragedies is the real reason we should be coming to work – the dollars and cents will follow. For those of us who are bosses or managers, it should remind us of the weight of our responsibilities. And for those of us who are workers (and aren’t we all?), it should serve as a reminder to buckle up, lock down, and be our own and our brother’s keeper. We can all do better.

NFL Preview: Bigs Hits, Big Trouble

Friday, January 19th, 2007

As we head toward the climax of the football season, with just four teams left on the path to the Superbowl, we read in the New York Times (registration required) that the big hits we cheer for may be causing permanent damage.
In November, Andre Waters, a 44 year old former safety for the Philadelphia Eagles, killed himself. He may have been a great safety, but he did not perform his job safely. He was famous for his relentless style and his ferocious hits. Waters thought he might have had as many as 15 concussions during his career. “I just wouldn’t say anything. I’d sniff some smelling salts, then go back in there.”
For the moment, we will pass on the question whether Waters’s death – despite the wilful intent – is work-related and possibly compensable under workers comp.
Chris Nowinski, a former lineman for Harvard and professional wrestler, convinced Waters’s family to provide brain tissues for testing. The results revealed the brain of an 85 year old man with early stage Alzheimer’s. Nowinski himself suffers from bouts of depression, which he relates directly to his half dozen concussions. “I have maybe a small window of understanding that other people don’t,” he says, “just because I have certain bad days when my brain doesn’t work as well as it does on other days…But I know and understand…because I know it’ll probably be fine tomorrow.” Of course, Nowinski is only 28 years old. I wonder how he’ll feel at 44.
The NFL policy on concussions is what you might label “wishful thinking.” They allow players who sustain a concussion to return to play the same day if they appear to have recovered. Despite a concussion, the Jets’ Laveranues Coles was available during the playoffs, as is the Colts’ Cato June, who suffered a concussion last week and who looks forward to jamming his helmet in the bodies of the New England Patriots this week. The NFL’s mild traumatic brain injury committee has published several papers in the journal Neurosurgery defending the practice. They see no signs of neurocognitive decline among the players returning to “work” immediately after being injured. But Nowinski points out that these studies are limited to active players. When you look at players after retirement, the picture is not so rosy.
In a survey of more than 2,500 former players, the Center for the Study of Retired Athletes found that those who had sustained three or more concussions were three times more likely to develop earlier onset of Alzheimer’s. A new study finds a similar correlation with depression. That’s after just three concussions. The odds against Andre Waters, with his 15 or so concussions, must have been formidable.
Let the Games Begin!
Humankind needs danger-ridden spectacles. We cheer on our gladiators, even as we deride the behemoths from the other city. According to Wikipedia, the Roman gladiators were less prone to killing off the losers than Hollywood has led us to believe. Some died, some lived to fight another day. After three years of toil, the best-performing gladiators of old could retire and live the good life. Not all that different from modern times. But at what price? When the spectators have left the stadium, when the awards have all been handed out, we’re left with the walking wounded, the ones who paid the price. It’s enough to give us pause, but not for long, as we breathlessly look forward to the Sunday kick off.

Cavalcade of Risk, No. 17

Thursday, January 18th, 2007

David Williams is hosting Cavalcade of Risk #17 at Health Business Blog. It’s brimming with lots of good links for you risk-o-philes out there. While over at David’s place, be sure to check out his blog’s svelte new layout, too.