Posts Tagged ‘Connecticut’

The Enigma Variations: Comp Rates in Connecticut and Massachusetts

Wednesday, October 17th, 2012

Today we examine two states, side by side on the map, going in opposite directions in their workers comp rates: Connecticut, which has the dubious distinction of being the second most expensive state (only Alaska is higher) and Massachusetts, ranked 44th for overall costs, with rates so low the market is beginning to implode. These states may be headed in opposite directions, but each faces a pending crisis.
Messing with the Miracle
We begin with Massachusetts, which my colleague Tom Lynch summarized brilliantly a few weeks ago. After nearly two decades of rate reductions, MA employers are now paying about the same rates as existed in the early 1980s. Compared to the other New England states, MA rates are consistently lower, some times one fourth that of their neighbors. So it is hardly surprising that the Workers Compensation Rating and Inspection Bureau (WCRIB) sought an increase in the rates: they initially requested 18 percent, with the realistic hope of ending up somewhere in the vicinity of 6 to 8 percent. A rate increase of this magnitude would maintain the state’s position as the lowest among the major industrial states, still far below its New England neighbors.
The response of the state’s Division of Insurance is, in its methodology and ultimate result, a public work that might make the infamous Big Dig seem prudent and reasonable. The Division dismantles the entire application, demeaning and ultimately dismissing virtually every data element supporting the rate increase. While it is true that some of the data was inconsistent – due largely to the idiosyncracies of insurer submissions – the report’s conclusion that no rate increase was merited defies common sense. Indeed, when the attorney general opines that higher rates “would greatly increase the cost of doing business in Massachusetts and have a deleterious effect on the overall employment level,” one can only wonder what they have been smoking – perhaps the substance on the ballot up for legalization next month.
One the mainstays of the Division’s argument is the fact that insurance carriers continue to offer rate deviations: proof, in the Division’s eyes, that the rates must be high enough. Perhaps it is time to remind the bureaucrats who administer this program that insurers always think they can defy the odds and find the optimum risks. Insurers sell insurance to the people and organizations least likely to use it – or so they hope. As Tom Lynch likes to say, “insurance companies are prone to eating their young.” Nonetheless, a glance across state lines and across the country reveals that Massachusetts is about to cook the golden goose: with the current unabated rate suppression, the assigned risk pool will continue to grow and savvy carriers will scale back their participation in the workers comp market.
Asleep at the Wheel
While Massachusetts’s inaction on rates jeopardizes the most successful comp reform program in the country, Connecticut meanders toward economic disaster. As recently as 2008, the state was ranked 20th for overall costs in the invaluable Oregon Rate Study. But in 2010 they rose to 6th, and the state now sits in the number two spot, ahead of such reliably high cost states as New York, California and Florida. The median cost of comp in CT has risen to $2.99, compared to the nation-wide average of $1.88. (MA comes in at a paltry $1.37.) CT suffers from a toxic combination of very high medical costs (doctors love it) and a worker-centric system that is extremely generous with benefits. To add insult to injury, NCCI is requesting an additional 7.1 percent increase in the already bloated rates. Costs are out of control and regulators are asleep at the wheel.
Surely it is time for business advocates in Connecticut to raise the red flag. The cost of comp has reached unacceptable levels. When business owners can move their operations to New York to lower the cost of workers comp, you are in deep, deep trouble.
Across the Rate Divide
MA and CT provide compelling examples of enigma variations: in the perpetual search for comp rates that are fair to both carriers and businesses alike, these states have drifted too far from the middle ground. How they reached this point may be an enigma, but what they need to do is clear: take immediate steps to extricate themselves from rate cycles that simply are not working. It will take leadership, vision, and courage to confront these reverse-image crises.

In MA, regulators must stop playing political games – no easy task in a hyper-political state – and allow rates to begin a long overdue, moderated rise.

In CT, regulators must confront entrenched stake holders and begin to exert control over runaway costs.

With rates either much too low or much too high, state leaders and regulators are mired in swamps of their own making. If the current inertia is allowed to continue, the two states may eventually end up in the same place: with dysfunctional comp systems incapable of serving the needs of injured workers and employers alike.

Physician drug repackaging, front and center

Thursday, July 12th, 2012

The drum that our colleague Joe Paduda has been beating for several years – the outrageous cost of repackaged drugs in Florida – appears to be resonating. This esoteric little nook and cranny of workers comp that is costing employers millions across many states would normally not attract much attention in mainstream media – heck, even a lot of grizzled workers comp vets weren’t conversant with the practice or the potential adverse affect on costs. But yesterday, the issue made the business section of the New York Times in an article by Barry Meier and Katie Thomas, Insurers Pay Big Markups as Doctors Dispense Drugs. They sum up the crux of the matter: “At a time of soaring health care bills, experts say that doctors, middlemen and drug distributors are adding hundreds of millions of dollars annually to the costs borne by taxpayers, insurance companies and employers through the practice of physician dispensing.” The article goes on to note that, “The practice has become so profitable that private equity firms are buying stakes in the businesses, and political lobbying over the issue is fierce.”
Florida and the case of Automated HealthCare Solutions are used as examples in the article. We’ve leave you to follow the excellent job the reporters do in outlining the issue, tracking down connections, and showing how a recent legislative attempt to close this costly loophole was squelched. Alan Hays, the Republican state senator in Florida who introduced the defeated bill said that, “The strategy of the people that were opposed to this bill was to put the right amount of dollars in the right hands and get the bill blocked,” he said. “And they were successful in doing that.” That defeat is costing employers and taxpayers some $62 million, according to the state’s insurance commissioner.
Don’t miss the accompanying infographic, Paying Much More in the Doctor’s Office. Also note the 424 comments to the article, which we are still perusing at this time – it’s not often that a detailed workers’ comp issue garners that much attention in the so-called mainstream press.
We give a big tip of the hat to Paduda, who has posted on the Florida repackaging issue repeatedly. going back several years, despite some personal jeopardy in the form of a threatened lawsuit, later dismissed by a federal judge.
How Connecticut is dealing with Physician Drug Repackaging
In February, Paduda posted that physician dispensing was coming to Connecticut and urged his readers to contact regulators. At Evidence Based blog, Michael Gavin posts an update: Connecticut Gets Drug Repackaging Right: Removing the Financial Incentive. Interestingly, this was done via a rule change rather than a statutory change. Plus, it does not ban the practice of physician dispensing, and it even allows a reasonable administrative fee. Gavin suggests that these central tenants of an effective regulatory approach to repackaged drugs might serve as a model for other states. Florida, take note!

Of Pain Killers, Wilful Misconduct and Compensability

Monday, June 11th, 2012

The immortal Mae West once said that “too much of a good thing can be wonderful.” When it comes to pain relievers, however, too much of a good thing can kill you. Which brings us to the sad saga of Anthony Sapko, who died of an accidental prescription drug overdose in August of 2006. Sapko worked as a policeman for 21 years in New Haven, CT, and went on in the mid-1990s to become a state corrections officer. Beginning in 1999, he was treated for depression. He suffered four work-related injuries while working in corrections, the last being a back problem from which he never returned to work.
Sapko was treated with a cornucopia of medications: oxycodone, Zanaflex, Kadian, Celebrex, Roxicodone, Avinza, Lidoderm patches and Duragesic. When his depression deepened in 2006, his psychiatrist prescribed Seroquel. Two weeks later, Sapko was dead. The autopsy revealed a level of oxycodone 20 times normal, and of Seroquel at 5 times normal. The combination of the two over-consumed drugs proved both toxic and fatal.
Suicidal Intent Vs. Accident
Sapko’s widow filed for workers compensation death benefits. The claim was denied at the Commission level and again at the Appeals Court level. Sapko’s widow argued that the death was directly related to his workplace injuries, but the court found a disconnect: this was not a suicide (where such a link might be established), but an accidental overdose.
In a December 2011 blog, we made note of two similar cases: a compensable case in Tennessee and a denied case in Ohio. Fatal overdoses, in other words, may or may not be compensable, depending upon the specific circumstances and state-based precedents. But the over-arching issues are clear: the abuse of prescription narcotics has reached epidemic proportions in workers comp; some individuals are unable to properly self-manage the use of these medications; and doctors are all-too-too willing to prescribe very powerful drugs to alleviate pain.
Workers compensation is endlessly fascinating because it inevitably brings together pain (from workplace injury) and pain suppression (far too often, opioids). In Sapko’s foreshortened life, the combination of medications was toxic. In workers comp as a whole, the mixture of pain and drugs is proving to be a formidable problem.
No Will, No Way?
One of the interesting sidebars in this case is the concept of wilful misconduct: when an injured worker abuses prescription medication, is this a “serious and wilful” action that precludes compensability? Or is the pain so consuming and the drugs so powerfully addicting, that the concept of “wilful” disappears in a drug-induced haze? There are no simple answers. There is undoubtedly some link between Sapko’s depression, the work he performed and the injuries he suffered. But in the world of comp these links must be explicit and, unlike life itself, unambiguous. It would require a novelist to reveal the connections. Unfortunately for Sapko’s widow and children, the commissioners and judges in charge are simply not in a position to craft that kind of narrative.

Risk carnival, election wrap-up, and tooting our own horn

Wednesday, November 3rd, 2010

This week’s Cavalcade or Risk is posted by Ironman at Political Calculations. This biweeky roundup of risk posts is a sampling or “carnival” or topic-related posts. Ironman grades the entries for topicality, quality and readability – check it out.
Election resultsWashington’s Initiative 1082 to privatize workers’ comp was soundly defeated last night, as about 58% of the voters opted to keep the system that has operated since 1911 in place. Obviously, this is a disappointment to private insurers and independent agents that hoped to open the state.
In Louisiana, it looks like Amendment 9 passed, but news reports we found are still vague. This change would require that claims would have to be re-argued before a panel of at least five appeals court judges before an agency’s decision could be reversed or changed.
In Arizona, Oklahoma and Colorado, voters cast ballots on constitutional amendments that would bar healthcare reform’s mandate that individuals buy insurance. Opt-out measures were passed in Oklahoma and Arizona, but was defeated in Colorado. Missouri had rejected the mandate in August, but not by a a state constitutional amendment.
At Comp Time, Roberto Ceniceros took a pre-election look at what gubernatorial wins might mean in California and New York. He notes that Jerry Brown was very quiet on the issue of workers compensation in California, but in New York, Andrew Cuomo has employee misclassification on his radar screen. As the state’s Attorney General, he recently joined attorneys general from Montana and New Jersey in an intent to sue FedEx.
And as long as we are on politics, it seems like a good time to bring up today’s news that the Treasury expects to earn a profit on AIG investments. Overall, despite the controversy, the Troubled Asset Relief Program (TARP) bailout looks as though it is earning a healthy return.
CT Commissioner resigns – somewhat upstaged by yesterday’s election brouhaha was news that Connecticut’s Insurance Commissioner resigned abruptly. National Underwriter reports that Thomas Sullivan resigns amid pressure over healthcare rate hikes. He faced criticism after approving a 47% rate hike by Anthem BC/BS of CT.
Workers Comp Insider again named to top WC blogs
We were gratified and pleased to be named to 2010 roster of the LexisNexis Top 25 Workers Compensation and Workplace Issues:

“Consistently at the top of the heap when it comes to workers’ comp blogs, the Workers’ Comp Insider is a rare combination of breadth and depth. Now in its eighth year, the Insider covers comp issues, risk management, business insurance, and workplace health and safety from Anchorage to Miami. It provides in-depth analysis concerning workplace legislation, occupational medicine, and best practices from Maine to Hawaii. It should be in the “favorites” folder of every comp attorney’s web browser.”

We thank you, our readers, for your continued interest and support. We were happy to see many friends and colleagues on the list as well – we’re honored by the company in which we find ourselves. Be sure to check out some of the other fine blogs on the list. Also, if you haven’t discovered the gem that is the LexisNexis Workers’ Compensation Law Community, we urge you to check that out, too.

The aftermath of a CT tragedy

Tuesday, August 10th, 2010

Yesterday was a day of remembrance for the victims of last week’s horrifying shootings at Hartford Distributors in Connecticut – our hearts go out to the family, friends, and coworkers of the deceased. Their lives will be forever changed and imprinted by this terrible event.
In chilling testimony minutes before death by his own hand, we hear the shooter in the deadly rampage calmly relaying his motive to a police dispatcher: “This place right here is a racist place…They’re treating me bad over here. And treat all other black employees bad over here, too. So I took it to my own hands and handled the problem. I wish I could have got more of the people.”
Omar Thornton’s murderous acts left eight coworkers dead and two grievously wounded. The horrifying massacre brought to mind another racially-motivated workplace-based mass murder, the 2003 shooting at a Lockheed Martin plant in Meridian, Miss., which left 6 dead and 8 wounded. Unlike last week’s shooting for which there were few if any advance clues or hints, the killer in Meridian had left a trail of violent threats and behaviors. Many who knew or had worked with Doug Williams feared and even predicted that his threats would culminate in some terrible event.
Whether racism was a trigger in the Connecticut case or not seems a moot point. Even if it were true that racism occurred, as alleged by the family of the shooter, that would not justify such a heinous and wildly disproportionate reaction. Company and union officials deny the allegations of racism and say that no such grievances had been filed or were on record. Yet Thornton’s call and the allegations will likely play a factor as lawyers for the victims seek damages. If victims seek any redress beyond workers compensation, they will face a high hurdle. When litigation is successful at piercing the exclusive remedy shield, it often involves employer misconduct that is highly egregious.
In 2005 and again in 2008, courts barred tort claims for Lockheed victims and upheld workers compensation as the exclusive remedy. Plaintiffs felt they had a strong case and sued Lockheed on the basis of having been deprived of civil rights. They cited a 2004 EEOC report, which stated: “(Lockheed) was aware of the severity and extent of the racially charged and hostile environment created by Mr. Williams, which included threats to kill African-American employees,” the determination by the EEOC’s Jackson office said. “(Lockheed’s) reaction to those threats against African-American employees was inadequate and permitted the racially charged atmosphere to grow in intensity, culminating in the shooting of 14 individuals.”
We noted then and note again now that, while often an imperfect and unsatisfying system, workers comp generally holds up as the exclusive remedy in such cases.
Can employers inoculate against such events?
While most workplace risk can be managed and risk mitigation strategies can be adopted to eliminate or minimize hazards, when it comes to the human heart and mind, preventive strategies can be less certain. There are certainly best practices that can be put in place, predictive profiles and warning indicators that can be consulted, and good hiring and supervisory practices that can be enacted.
Connecticut attorney Daniel Schwartz has been following this event and others on his blog. He recalled another terrible CT event on the 10 year anniversary of the 1998 Lottery headquarters shooting, which claimed the lives of four supervisors. Schwatz has revisited the topic of workplace violence on more than one occasion, offering best practice tips and resources for employer vigilance. In light of the recent tragedy, he asks if there are any lessons to be learned from evil. He concludes:

“Despite all the guidance and advice that can be given, the awful truth is that there really is no way to prevent tragedies like this from ever occurring. An employer can do everything “right” and yet still a rampage ensues by someone committed to carrying out a terrible crime.
That’s not to say that employers should ignore the issue; they shouldn’t. But we also should be careful not to draw conclusions from an incident like this too.
Indeed, as we look for answers from this tragedy, perhaps its best to acknowledge that we can never truly understand what brings people to commit evil and that despite whatever efforts we might make, something like this will sadly happen again.”

Trusts in Trouble

Friday, May 7th, 2010

We recently blogged the collapse of the self-insurance trust market in New York. When CRM Holdings, a Bermuda based operator of self insurance groups (SIGs), folded like a house of cards, the New York comp board went after the healthy SIGs to cover CRM’s liabilities. They hit these innocent folks with a whopping $11 million assessment. As a result, a number of SIGs abandoned the New York market, only to learn two years later that the comp board’s assessments were illegal. Oh, well. It seemed like a good idea at the time.
Now we move a few miles to the east and find a similar situation brewing in Connecticut. Municipal Interlocal Risk Management Agency (MIRMA) has been writing comp policies for municipalities since 2002. The great thing about comp is that it’s so easy: offer coverage at rates lower than competitors, collect the premiums and pay the claims as they come in. Unfortunately, the premiums MIRMA has been collecting are not covering the claims generated by the insured municipalities. So MIRMA is in the uncomfortable position of trying to collect additional funds from cash-strapped municipalities. For example, North Branford owes $600,000, Westbrook owes $158,000; and Killingworth owes $71,188. In these trying times, that’s not exactly chump change.
The legislature passed a bill to give the municipalities more time to come up with the money. The bill would have amended the amount MIRMA was required to keep in its reserves, and thereby allow the towns to pay the amounts they owe, interest free, over four years. Governor Jodi Rell is not buying that approach; she vetoed the bill. The governor issued a statement:

MIRMA has been undercapitalized since its creation. Although it has been given several years to remedy its financial situation, it has failed to do so. Now, providers are not being paid and injured workers are at risk of not being treated. MIRMA can no longer exist in its current state of outright capital inadequacy.

The governor went on to state that MIRMA stopped paying workers’ compensation claims simply because it does not have the money to pay, which is “wholly unacceptable.” She wrote that MIRMA’s deficit has grown by more than 300 percent in the last six years, and is predicted to reach well over $15 million by 2013. That might seem small by CRM standards – their deficit was upwards of $50 million – but then again, Connecticut is a lot smaller than New York.
Untrustworthy Trusts
The governor has ordered a complete review of MIRMA’s finances. I could write the report without even looking at the books. In their effort to build market share, MIRMA underpriced their policies. They probably spent a lot on marketing and frills. To balance the books, they under-reserved claims, hoping to cover the cash short-fall by building market share. It worked until it didn’t. Now they have run out of money, so they cannot pay the claims. If the auditors have a sense of history, they will conclude that MIRMA operates like a subsidiary of CRM.
NOTE: CRM, still operating in California, appears to be on the ropes.
Connecticut’s short term solution – requiring the insured municipalities to come up with the money – is fair, if hardly feasible. At least Connecticut is not going to penalize the municipalities who declined to participate in what appears to be MIRMA’s modified Ponzi scheme. That’s good. But it remains to be seen how cash-strapped municipalities – already facing substantial budget cuts – are going to come up with these substantial sums of money.
When it comes to self-insurance trusts in the Empire and Nutmeg states, it’s time to put away the beer kegs and cancel the golf outing: the party is over.

Health Wonk Review and other noteworthy news briefs

Thursday, April 1st, 2010

Rich Elmore has posted a most excellent Health Wonk Review: Special Edition on Health Care Reform, which might also be called the “when pigs fly” edition. It has a good roundup of the health policy blogosphere’s reaction to the landmark legislation and a handy, must-see one page info-graphic of the time line.
Prevention in Health Reform – at the NIOSH Science Blog, John Howard, the Director of National Institute for Occupational Safety and Health, summarizes prevention provisions in the Patient Protection and Affordable Care Act and their implications for workplace safety and health.
Frequency – At Comp Time, Roberto Ceniceros looks at the way that health care reform might impact workers comp claim frequency. He explains that the data in this area is thin, but elicits some educated opinions on the topic.
More grim news from China – In addition to the increasingly desperate search for 153 miners which we discussed earlier this week, Ken Ward reports that in a different China mine, 12 miners have been killed and another 32 are missing.
Lifesaver – HR Daily Advisor tells us that survival rates for out-of-hospital cardiac arrest are only about 5% due to the length of time it takes to get treatment to the victim. The sooner defibrillation is started, the more likely the victim will survive. A recent series of posts discuss the benefits of adding an Automated External Defibrillator (AED) as part of a corporate wellness program. “OSHA says that immediate use of an AED can result in a 90 percent survival rate. With each minute of delay, however, nearly 10 percent fewer survive.” A follow-up post discusses related legal and training issues
Food processing – At The Pump Handle, Carlos Rich makes the case for food processing companies to treat workers more like humans and less like machines. We agree. Meatpacking and poultry processing plants are some of the most notorious environments for safety today. Many also play fast and loose with employment laws.
New blog finds

  • Fair Warning – “…an online nonprofit publication that seeks to provide robust, public interest journalism on issues of health, safety and corporate conduct.” The publication promises investigative journalism, legal and regulatory news, and reports from think tanks, academics, and advocacy groups.
  • Work Safety Blog from Blog4Safety – bills itself as “Your online resource for safety information, safety tips, and safety compliance.” It’s not a new blog, posts go back to 2008, but it is a new discovery for us. The blog is sponsored by The blog content has been provided by Texas America Safety Company (T.a.s.c.o.).

9/11 suit back to bargaining table – Southern District of New York Judge Alvin K. Hellerstein surprised a lot of people when he rejected the proposed $575+ million settlement for 9/11 first responders. His complaints? The settlement paid to victims was too little. Read more from law.com: 9/11 Lawyers Return to Bargaining Table to Refine Settlement.
Quick Takes

Cavalcade of Risk #100 (!) and other news of note

Wednesday, March 10th, 2010

Is the 100th time the charm? Cavalcade of Risk celebrates its centesimal issue today – that’s a lot of risk coverage! Our host for this landmark issue is Russell Hutchinson of moneyblog – tip of the hat to him for a good issue. And kudos to Cavalcade founder and visionary, Hank Stern of InsureBlog.
Chronic Pain – a few weeks ago, we brought you one approach to chronic pain management. In Risk and Insurance, Peter Rousmaniere discusses the CT Workers’ Compensation Trust approach to chronic pain. This self-insurance pool of 390 healthcare employers introduced a a five-pronged program in 2009, which Rousmaniere outlines. He challenges readers to “consider how many of the five you or your vendors apply.”
Uncovered in Georgia – a loophole left 88 injured workers without workers’ comp coverage on the recent failure of Atlanta-based workers’ compensation insurer Southeastern U.S. Insurance (SEUS) Inc. Normally, the state’s insolvency pool would serve as a safety net for failed insurers, but up until a law change in 2008, captive insurers were not covered by this pool. While SEUS had converted from captive to become a traditional insurer, 88 workers claims predated the conversion and are responsible for their According to the article, “Eight of those workers have catastrophic injuries and will need lifetime care. One has medical needs exceeding $45,000 a month.”

“Twelve other firms that operated under rules that exempted the failed company’s clients from drawing from an insolvency pool still do business in the state. And while they all now pay into that pool, 10 have claims predating the 2008 change in the law that required them to do so.
If any fail, workers with active pre-2008 claims could find themselves in a similar bind. State insurance regulators say they don’t know how many people ultimately could fall in that category. But they say they don’t think any of the 12 companies is in danger of failing.”

Mad as a hatter – On the recent release of Tim Burton’s Alice in Wonderland, the CDC reminds us that the phrase “mad as a hatter” originated from on-the-job mercury poisoning. To shape felt hats, hat makers used a solution of mercuric nitrate and, as a result, often suffered from agitation, tremors, slurred speech and other neurological symptoms – thus, “mad as a hatter.” Hat manufacturers used mercury until 1941. Mercury is still used in many industries and the CDC article has some interesting statistics, as well as a page devoted to recommendations, reports, and other resources for preventing hazardous exposures to mercury on the job.
Fatal Injury mapping – via Occupational Health & Safety, we learn that OSHA has introduced a new fatal injury mapping module, which “…allows users to create customized, color-coded maps of injury-related death rates throughout the United States. It defines injury-related deaths according to intent (e.g., unintentional, homicide, suicide) and mechanism of injury (e.g., motor-vehicle traffic, fall, fire or burn, poisoning, cut).” CDC’s Fatal Injury Mapping Module. Other data and statistics are also available from CDC’s WISQARSTM (Web-based Injury Statistics Query and Reporting System), an interactive database system that provides customized reports of injury-related data.
NY crane deaths followup – Liz Borowski of The Pump Handle offers and update on the 2008 crane NY crane disasters. The owner of the city’s largest construction crane company is expected to be indicted for manslaughter in the death of two workers in one of the incidents. She also updates status on OSHA’s crane & derrick rule.
Legislator, heal thyself – More than 70% of congressional offices violate OSHA safety standards – but the good news is that violations have dropped. “The number of Occupational Safety and Health Administration (OSHA) violations found in each office has significantly decreased over the years as well — from an average of about 8.15 violations per office in 2007 to an average of 1.75 hazards in each office this year.” (via Advanced Safety and Health)
March is workplace eye wellness monthReliable Plant offers some tips on eye and face protection. Other resources: OSHA Eye and Face Protection; NIOSH: Eye Safety; National Safety Council: Protecting Your Eyes from Injury; Healthy Vision 2010: Occupational Eye Injuries
Briefs

(Uncompensable) Nightmare at Work

Tuesday, February 23rd, 2010

In December we blogged the horrendous case of Carla Nash, a lovely woman who was mauled by a chimpanzee owned by Sandra Herold, a friend. The 200 pound chimp literally ripped her face apart. Nash, who lacks health insurance, has been hospitalized for over a year at the Cleveland Clinic. The attack destroyed her vision and rendered her face unrecognizable (and unviewable). Doctors have determined that she is not ready for a facial transplant. She has sued Herold for $50 million. Her medical bills will easily run to 7 figures; who will pay has yet to be determined.In our prior blog, we noted that Herold was trying to limit the exposure to her workers comp policy.
A little lost in Nash’s tragedy is the fate of Frank Chiafari, the Stamford, Connecticut police officer who came to Nash’s aid. The raging, blood-covered chimp approached Chiafari’s cruiser, tore off the mirror, ripped open the door and tried to attack the policeman. Chiafari shot and killed the chimp.
In the weeks and months following the incident, Chiafari suffered from post-traumatic stress disorder (PTSD); he experienced anxiety, flashbacks, mood swings and nightmares. He underwent counseling. (It’s not clear how much time, if any, he was away from work.) Chiafari’s workers comp claim was denied: under Connecticut law, public safety officers are eligible for PTSD benefits only when they shoot people – not animals.
Compensating for the Uncompensated
The good news is that Stamford has been covering Chiafari’s medical bills, although they did require him to switch to a therapist of the city’s choosing. The even better news is that Chiafari has literally been working his way through this work-related nightmare. He is still on the job.
There is movement in the Connecticut legislature to amend the workers comp statute so that public safety officers are covered for PTSD resulting from the use of deadly force involving animals. As is so often the case, the law will be adjusted long after the incident that exposed the gap in coverage. Fortunately for officer Chiafari, the city, despite the comp denial, recognized the legitimacy of his claim and paid for the needed counseling. They did the right thing for an officer who did the right thing. Nothing will erase the horrible images from that fateful day last February. But life for Chiafari can go on in all its ordinary splendor – more than we can say, alas, for the ill-fated Carla Nash.

“Exclusive Remedy” for Losing Your Face?

Tuesday, December 8th, 2009

Usually employers try to prove that someone is not an employee, in order to avoid the workers comp liability. (Think “independent contractor.”) Today we examine a truly horrific case where the employer is desperate to establish compensability under workers comp, so that a grieviously injured employee can only collect comp benefits. By using the “exclusive remedy” provision of comp, the employer wants to avoid liability for pain and suffering. Some pain, some suffering!
Sandra Herold runs a towing company out of her house in Stamford, Connecticut. The company had a mascot – a 200 pound chimpanzee named Travis, who lived with Herold. I do mean lived with her: according to reports, they shared wine at candle lit dinners and shared a bed as well (no further comment possible).
Charla Nash occasionally worked for Herold, in an unspecified capacity. In February 2009, Herold called Nash and asked her to come by, as she was having trouble controlling Travis. As soon as Nash arrived, Travis attacked her, ripping off her face (literally). She lost her eyes, nose and mouth in the horrendous attack. (While images of her ravaged face are available on the internet, I do not recommend viewing them.) Police eventually were able to shoot the chimp.
Nash somehow survived the attack and is suing Herold for $50 million; a second suit against the state of Connecticut seeks an even larger amount, alleging negligence in allowing Herold to keep the animal in her home. (It is worth noting that no criminal charges have been brought against Herold.)
Exclusive Remedy?
Herold’s first line of defense is establishing workers comp as the “exclusive remedy.” She claims that Nash is an employee and thus is prohibited from suing her “employer.” While it may be premature to judge this particular strategy, it seems highly unlikely that Herold will prevail. Even if she can show that Nash was on the payroll, it is clear that Nash was not working on the day of the attack; Herold had called her and asked her to come over to help with Travis. And even if it can be proven that Nash occasionally helped out with Travis, it is unlikely that her job description included the duties of an animal trainer (for which she is not qualified).
In the unlikely scenario that this case is limited to workers comp, the claim will run in the multiple millions: comp will have to pay for Nash’s humongous medical bills – including a face transplant – and support her astronomical living expenses. This is a permanent total injury, so the indemnity portion may also be substantial. (If I were Herold’s comp carrier, I would aggressively deny this claim as not being work related.)
Herold is banking on a judicial process that finds having your face ripped off by a 200 pound beast is simply part of the job, part of the “assumption of risk” we all accept simply by showing up for work. (If that were the case, how many of us would be willing to report to work?) Herold’s house-of-cards defense will collapse with the most humble of gestures: Nash revealing her destroyed face to a jury.
Exclusive remedy is an important concept, one well worth preserving, but in this situation, it has no place. Herold must be held accountable for the actions of her late companion, Travis – anything less would be a travesty.