Posts Tagged ‘litigation’

News roundup: Risk Roundup, Wal-Mart Class Action, WCRI Report, Massey Probe Widens & more

Wednesday, November 28th, 2012

Risk Roundup – Emily Holbrook hosts Cavalcade of Risk #171 at Risk Management Monitor – be sure to check it out.
One to watch: Wal-Mart Class action & WC – In Business Insurance, Roberto Ceniceros writes about a Wal-Mart class action settlement that raises big workers comp questions. Josephine Gianzero et al. v. Wal-Mart Stores Inc. resulted in a settlement for 13,521 plaintiffs. It raises several issues of concern related to workers comp: the case was a breach of the exclusive remedy provision – an issue that is always of some concern to employers – and it raises questions about medical claims management.
According to Ceniceros: “The settlement involving Wal-Mart’s claims administration unit and Concentra Health Services Inc. in Colorado also is troubling since it is believed to be the first payout resulting from recent suits alleging that employers’ and workers comp service providers’ claims management practices violated the Racketeer Influenced and Corrupt Organizations Act, several observers say.”
This is quite the hot potato and of concern to TPAs, several of whom declined comment on the case. As Ceniceros reports, “The issue is sensitive because the lawsuit raises the question of how far claims administrators can pursue management of questionable medical treatments found through common practices, such as utilization reviews, without violating the law, the source said.”
(Here’s a summary of the case when the class action was certified in 2010.
How to keep injured workers from turning to lawyers – In the current issue of CFO, Richard Victor writes about a recent Workers Compensation Research Institute (WCRI) study that sheds light on why injured workers feel the need to hire an attorney: How to Keep Unneeded Lawyers Out of Workers’ Comp . It’s a good article and worth the read – here’s a snippet:

“Not surprisingly, the study found that workers are more likely to seek attorneys when they feel threatened. Sources of perceived threats can take different forms. The character of the employment relationship, for example, was a factor for the 23% who strongly agreed that they hired attorneys because they feared being fired or laid off. Fifteen percent also strongly agreed that they needed attorneys because their employer could perceive their claims as illegitimate.

Miscommunication in the claims process was another significant factor. In fact, 46% said they hired attorneys because they felt the claim had been denied when, in fact, it had not yet been accepted into the process. Attorney involvement among workers with the most severe injuries were 15 percentage points higher than those with mostly minor injuries.”

Related: We refer you to one of our favorite articles on the topic by plaintiff attorney Alan S. Pierce: Top Ten List as to Why Injured Workers Retain Attorneys
More Charges; Big Branch Probe Widens – Ken Ward reports that today, federal prosecutors have charged a longtime Massey Energy mine manager with being part of a decade-long conspiracy to defy safety laws and dupe government inspectors. Expect more to come:

But in new court documents, Goodwin and Assistant U.S. Attorney Steve Ruby allege a broader conspiracy by as-yet unnamed “directors, officers, and agents” of Massey operating companies to put coal production ahead of worker safety and health at “other coal mines owned by Massey.”

It is the first time in their probe of the Upper Big Branch Mine Disaster that prosecutors have filed charges alleging Massey officials engaged in a scheme that went beyond the Raleigh County mine where 29 workers died in an April 2010 explosion.

Follow the ongoing story and find links to other coverage at Ward’s Coal Tattoo blog.
Pharma Costs – Joe Paduda links to and comments on a recent Express Scripts drug trends report. The long and short of it? Pharmacy price increases are driven by brands.
Fighting Fraud – Southern California has 65 billboards warning about work comp fraud. To raise public awareness or criminal penalties associated with fraud, the boards will be placed on billboards and transit shelter posters placed across San Diego County.
Strange Risks – Can you insure against acne attacks or hair loss? Lori Widmer has an entertaining read in this month’s Risk Management Magazine: The Stranger Side of Risk.
Other noteworthy items

News roundup: Risk, Dispensing Docs, Costs for Employees, Litigation & more

Wednesday, October 3rd, 2012

Risk roundup – Our Down-Under friend Russell Hutchinson of Chatswood moneyblog posts this week’s Cavalcade of Risk, with a global roundup of posts. Check it out.
Costs for EmployeesInsurance Journal reports on the latest Bureau of Labor Statistics report on the cost of U.S. employees, noting that the nationwide average cost for private industry employers was $28.80 per hour worked in June 2012. “The costs ranged within each region, with total compensation costs of $24.44 in the East South Central division to $33.47 in New England.” The article offers more detail on the report, noting that costs were collected from a sample of 47,400 occupations from about 9,500 establishments in private industry. Data excludes self-employed and farm and private household workers.
Physician Dispensing – Joe Paduda looks at potential conflict of interest issues in a post about ABRY Partners, he asks, “How is it that an investment firm owns stakes in a TPA, MSA company, subrogation firm – and a physician dispensing and billing company?” Is one company cleaning up a mess that another company makes? In other repackaging news, he notes that Miami-Dade Schools has taken a stand on physician-dispensed repackaged drugs – they are refusing to pay the markups, a move that saved more than half a million dollars. Employers take note: Is this a potential area of savings in your comp program.
Narcotics Studies – Rita M. Ayers reports on a recent study by Accident Fund Holdings and Johns Hopkins University that links opioid use to an escalation in overall claim cost in the Tower MSA Blog. She notes that the study reveals that 55% to 85% of injured workers receive narcotics for chronic pain. She says that the study, “…examined the interrelationship between the utilization of short- and long-acting opioid medications and the likelihood of claim cost escalating to a catastrophic level (> $100,000). Analyzing 12,000 workers’ compensation claims in Michigan during a four-year period, the study focused on whether the presence of opioids alone accounted for the cost increase or whether costs increased because opioids were associated with known cost-drivers, such as legal involvement and injury severity.” Related: WCRI: Nearly 1 in 12 Injured Workers Who Started Narcotics Still Using 3-6 Months Later.
Worst States for Lawsuits – “Lawsuit Climate 2012″ is a study evaluating how fair and reasonable states’ tort liability systems are perceived by businesses in the U.S. It was conducted by the U.S. Chamber Institute for Legal Reform. According to those surveyed, Delaware has the best legal climate for businesses.See respondents’ picks for the Top 10 Worst States for Lawsuits, along with more on the study’s results.
High Costs for Police Dept. – The LA Daily News reports that Los Angeles spends more on LAPD workers’ comp claims than for all others combined – some $65 million in 2010-2011 alone. The department averages 250 claims a month. Authorities say that it is “…one of four drivers of the city budget deficit. Others include the costs of salaries, pensions and health care.”
News Briefs

Addendum As a follow-on to yesterday’s post about Shackleton’s Medical Kit, we found more information and a photo of Shackleton’s medical kit at The Science Museum of London, and a related post from NPR’s Health Blog: ‘Cocaine For Snowblindness’: What Polar Explorers Packed For First Aid.
shackleton-medical-kit.JPG

A Cup of Tea and Millions Three

Monday, November 8th, 2010

On February 19, 2008, Rachel Moltner, a 76 year old New Yorker, went into the Starbucks at 80th Street and York Avenue and ordered a “venti’-sized” tea. Her tea was served to her double-cupped and lidded. She took it back to a table and tried to remove the lid to add sugar. She had difficulty with the lid, and in the course of her attempts to pry it off, the tea spilled onto her left leg and foot. Moltner suffered severe enough burns to require a skin graft. To compound her woes, during her hospital stay she suffered from bed sores and a fractured sacrum and herniated discs caused by a fall out of bed.
Moltner sued Starbucks. In a follow up to the suit, Starbucks asked how much Moltner was seeking, to which she responded, “not more than $3 million.” (Even at Starbuck’s prices, that’s a lot of tea…)
The suit accused Starbucks of serving tea that was too hot and that the serving in a doubled cup was inherently dangerous. She also said Starbucks should have warned her the tea could spill.
The appeals court rejected her case, saying “double-cupping is a method well known in the industry as a way of preventing a cup of hot tea from burning one’s hand.” Hm. Mitigate one risk, expose another…
Moltner also lost a subsequent appeal, based upon Starbuck’s slow response to her initial suit.
Tea Time
David Jaroslawicz, a lawyer for Moltner, said Tuesday’s ruling probably ends his client’s case.
“The other side presented an old lady knocking over her tea,” he said. “The case was really about that Starbucks has a directive to employees that you should not double-cup because it changes the center of gravity and can cause the cup to tip over.”
Note to engineers: Does double cupping really change the center of gravity?
Note to risk managers: Double cup to spare the hand or single cup for steadiness?
Better yet, how about taking your afternoon cuppa in a big white reusable porcelain mug? Still risky, to be sure, but slowing down is the best way to prevent bad things from happening, and slowing down is what tea used to be about.

Fresh Health Wonk Review & assorted news briefs

Thursday, April 15th, 2010

New Health Wonk Review – David Harlow of Health Blawg has posted an entertaining and informative Tax Day edition: Health Wonk Review: Block That Metaphor. Grab your coffee and dig in.
Diabetes prevention – At GoozNews, Merrill Goozner writes about the cost-effectiveness of diabetes prevention programs. Employers take note. We’ve frequently talked about the effect of co-morbidities such as diabetes and obesity on comp claims. Any progress on the prevention front would be good news for employers – both for the workers comp costs, and also for overall employee health and productivity.
Handy new toolCompPharmaPedia, a glossary of terms commonly used in the comp pharmacy business, published by CompPharma LLC, a consortium of workers comp PBMs. Not sure what a PBM is? Look it up!
Fleet safety – At the MEMIC Safety Blog, Randy Klatt posts about how GPS as a safety tool for fleet safety. “You can instantly see where all your trucks, vans, or cars are located and their current speeds… More efficient responses will also mean less temptation for drivers to exceed speed limits, especially since they know their movements can be seen. For those who have hours-of-service restrictions, GPS can be used to ensure accurate reporting and log keeping.”
Trainer killed by elephant – It’s been a tough time for animal trainers. A few weeks ago, a trainer was killed by a whale at a Florida”s SeaWorld, and last week, elephant handler Andrew Anderton was killed by Dumbo, the elephant that he trained and lived with for 15 years. The death is under investigation by OSHA, but was thought to be an accident after the elephant had a run in with sparks from an electrical wire. Animal-related occupational fatalities are more common than many might realize. Over a 6-year study period in the 1990s, the Department of Labor logged 350 animal-related fatalities.
Bullying – teen bullying has been much in the news of late, but unfortunately, this is not a phenomena that people outgrow. At Strategic HR Lawyer, Diane Pfadenhauer talks about workplace bullying.
Time lapse – At Comp Time, Roberto Ceniceros offers his nomination for strange claim of the month. OK, and while we’re on the theme of “strange,” we nominate the case of Copenhagen workers who went on strike in protest after an unusual work benefit was rescinded. You have to wonder what the safety record had been like.
10 ways to trigger a lawsuit – At HR Daily Advisor, Attorney Barbara Meister Cummins offers her picks for the 10 most lawsuit-attracting lines she hears from managers, part 1 and part 2. We’d add one that my colleague wrote about recently: “Don’t report that, you’ll screw up the safety bonus.”
Scary medical story of the week – If you think getting a computer virus in email program is bad, just wait until the hackers turn their sights to implantable medial devices. According to the MassDevice blog, hackers have already hijacked a patient support website for epileptics, MRI machines and electronic medical records. The post talks about these incidents and discusses the need for heightened security for devices with life-sustaining functions.
Scam alert – The National Association of Insurance Commissioners (NAIC) to consumers: Beware of health insurance scams.

Fresh Health Wonk Review; also – the power of pink, the bunkhouse rule, and more

Thursday, February 18th, 2010

Clear the decks – it’s Health Wonk Review day and Brady Augustine has posted Health Wonk Review: “The Relationship Rescue” edition over at medicaidfirstaid. It’s a Dr. Phil-themed issue replete with art, videos, and commentary on some of the best of the health policy blogosphere. Check it out.
The Power of Pink – Sometimes those of us who work in workers comp are so focused on the process, the insurance issues, and following the dollars that we lose sight of the fact that we are actually in the people business. Our friends at the Work Comp Complex Care blog have a refreshing post that demonstrates the difference one person can make: A little pink goes a long way.
The Bunkhouse Rule – Can an injury that occurs at home be compensable? Yes, if your home is your employer’s property, according to the South Carolina Supreme Court. Read more details on the ruling in Roberto Ceniceros’ article in Business Insurance, Migrant worker’s injury in company housing ruled compensable.
Misclassification – The L.A. Times features an article by Dave Gram on a topic that is near and dear to our heart (search for “FedEx”): how companies are slashing payrolls by calling workers independent contractors. The Internal Revenue Service and 37 states are cracking down on this practice, which resulted in an estimated underpayment of $2.72 billion in lost Social Security taxes, unemployment insurance taxes, and income taxes just in the year 2006, according to the Government Accountability Office. Many experts think that the economic downturn has exacerbated the problem of employee misclassification.
Good PT and bad PT – At Managed Care Matters, Joe Paduda asks How many dollars are wasted on physical therapy?. He suggests that while he’s a believer in the benefits of physical therapy, but advocates for clinical guidelines to separate the wheat from the chaff.
More on the Toyota mess – At Claims Magazine, Mary Anne Median writes that . Her article focuses on issues associated with claim-handling, subrogation, and litigation. It’s a fascinating read – here’s just a sampling:
“To break it down; damages, subrogation, and settlements will all be affected, not only for current, but also past and future accidents involving Toyotas.
This also leaves us with questions surrounding the diminished value of the vehicles. In determining that a vehicle is a total loss, what is the value? Can we apply this diminishing value factor when we are establishing what the insured’s or claimant’s vehicle is worth? How does this affect the resale and salvage value?”

Record workers comp-related ADA payout

Wednesday, February 17th, 2010

An employer’s failure to to accommodate an injured worker to return to the workplace can be costly – just ask Sears Roebuck & Co., who learned the hard way. The U.S. Equal Employment Opportunity Commission (EEOC) just announced that Sears will distribute $6.2 million to 235 former employees, the result of Americans With Disabilities Act (ADA)-related litigation. The monetary distribution stems from a September 2009 consent decree which resolved a class lawsuit against the retail giant. It is the largest ADA settlement in a single lawsuit in EEOC history.
This case began in 2001, when appliance technician John Bava injured his knees, wrist, and back after falling down the stairs while on a service call at a customer’s home. The injuries required two surgeries and physical therapy.

“Afterward, he tried to go back to work under restricted conditions in which he would not be required to kneel or squat for a prolonged period. “They wouldn’t let me come back,” he said.
Bava, 58, said he applied for several other jobs at Sears, including a service manager position that he claims went to someone younger and less qualified. He said he learned he had lost his job when his wife tried to use his employee discount card and found it had been canceled.
Bava obtained a copy of his personnel file from Sears, and found a memo saying he had been fired for medical reasons.
Bava said he now works as a repairman for another employer and stays busy despite the restricted conditions that his injuries make necessary.”

Bava filed a discrimination charge through the EEOC. A subsequent investigation by EEOC turned up 235 other employees who sought return to work with an accommodation, but were fired by the company; more than 20 other claimants’ situations were investigated and found to be ineligible.
The average award is approximately $26,300. According to reports in the National Law Journal via Law.com, employees will receive between $2,500 and $122,500 each, depending on their individual circumstances. As with all EEOC litigation, none of the settlement fund will retained by the EEOC; all of it will be distributed.
Employers would do well to examine their own return-to-work policies and programs in light of the other provisions that the three-year consent decree prescribes beyond monetary relief: an injunction against violation of the ADA and retaliation, a requirement that Sears amend its workers’ compensation leave policy, and train its employees regarding the ADA. Sears must also provide written reports to the EEOC detailing its workers’ compensation practices’ compliance with the ADA and post a notice of the decree at all Sears locations.
Besides compliance with the ADA, there are several other lessons to be learned by the stunning lack of communications evidenced in this case:

  • When an employee is out on disability, stay in frequent communication to monitor their recovery progress
  • Have a return-to-work goal and plan for all injured workers
  • If you fire employees, tell them! They shouldn’t have to learn about it through canceled benefit cards.

News roundup: health care reform, nursing safety, blog discoveries, retaliation, falls & more

Monday, June 25th, 2007

Health Care Reform – Joe Paduda was blogging the Democratic candidates’ positions on health care all last week. He offers a handy summary of where candidates stand on issues related to health care and offers his own prescription for the basics in health care reform. And in today’s post, he tells us what voters want in health care.
Nursing safetyMassachusetts nurses are seeking stronger protection against on-the-job violence. Fifty percent of the nurses responding to a 2004 Massachusetts Nurses Association survey reported being punched at least once in the previous two years. Many say the problems are getting worse, and are looking to the state legislature to extend protections. Lawmakers are considering a bill that would require hospitals to conduct an annual violence risk assessment and violence prevention plans.
Blog discovery – We are happy to see that Claire Wilkinson of the Insurance Information Institute is blogging at Terms and Conditions. Her most recent post (as of this writing) is a notice about a carrier evaluation survey conducted by Willis on performance metrics.
And speaking of nurses as we have today, it’s a good day to do a shout-out to Emergiblog, a nursing blog by Kim, a San Francisco-based nurse who deals with nursing-related issues and who often manages to infuse humor and style in her presentation. She also launched Change of Shift, a carnival for blogging nurses.
Falls in construction – rawblogXport reminds us of the heavy toll that falls take, particularly in construction. See our prior post on Falls and human fall traps: Fatalities in the construction industry.
Wrongful terminations – an in-house safety inspector was awarded $2 million in back pay, punitive damages and what the jury called “aggravation, inconvenience, humiliation, embarrassment and loss of dignity.” He was formerly employed at a mine owned by Massey Energy Co. and was fired after reporting safety problems at the mine to the federal Mine Safety and Health Administration. And in New Jersey, a forklift operator for Weyerhauser Company won an award of more than $600,000 because he was fired within two months of his having been injured on the job. Most states don’t take kindly to retaliatory firings. Jurors seem to like them even less.
Briefs