Posts Tagged ‘Missouri’

Annals of Compensability: (Lack of) Education Pays

Tuesday, March 26th, 2013

Imagine identical injuries to two workers: one is a junior college graduate, the other lacks a high school diploma;one can read and compute fairly well, the other reads at the 8th grade level and performs math at the 6th grade level. The injury involves failed back syndrome, with the injured worker experiencing fairly constant pain and the inability to perform sustained physical work.
In the world of workers comp, the first worker is deemed “employable” and entitled to temporary total benefits, followed (in some states) with a lump sum settlement for permanent loss of function. The second worker, lacking the education and skills to transfer to another job, is awarded permanent total disability benefits. In the two claims involving identical injuries, a marginal education pays.
For many years, Missouri resident Todd Grauberger worked for Atlas Van Lines, moving furniture and household goods. He performed heavy lifting routinely, avoiding physically demanding work only when driving from pick up point A to delivery point B. Ironically, his injury did not involve heavy lifting: in December 2001, he bent over to put padding on a nightstand – something virtually anyone could do – and felt an immediate pain in his back. His herniated disc required surgery. Even after some minor improvements, he continued to suffer from substantial pain and numbness in his legs. He was diagnosed with a phrase that terrifies any injured worker – and any claims adjuster: “failed back syndrome.”
Grauberger filed for permanent total disability benefits. His employer countered with a vocational rehabilitation assessment that concluded – without directly interviewing Grauberger – that he could perform light factory work or perhaps drive a car or truck. But the claimant’s doctor countered that with a failed back and almost no transferable (non-physical) skills, Grauberger was unemployable for any position that he might be qualified to hold. In other words, his only employable asset was the labor of his body and his body was irreparably broken. In a unanimous decision, the Court of Appeals in Missouri sided with Grauberger and upheld the award of permanent total benefits.
Hiring Conundrum
Employers do not give much thought to transferable skills when they hire new employees. They simply hire people qualified to do the work. Indeed, for jobs requiring sheer physical strength, it is often cheaper to hire the lowest skilled available workers. But workers comp, long the great equalizer, takes a post-injury look at employability. Once maximum medical improvement has been reached, the issue for workers comp is simple: the worker is either employable or not. If employable, benefits come to an end. If there are no transferable skills and no reasonable prospect of employment, the benefits may continue for the lifetime of the worker.
Grauberger will never again have to worry about finding gainful employment. Because he can offer nothing of value to the labor market, and because of his persistent, debilitating pain, he will be supported by workers comp indefinitely. It’s an odd calculus, seemingly rewarding the absence of marketable skills beyond the strength in one’s body. In this Missouri case, limited skills and limited education secure a future well beyond the reach of a failed back and a failing body.

Missouri: The Roofer’s Conundrum

Tuesday, September 18th, 2012

Five years ago we blogged Missouri’s tough-on-workers reforms that made it more difficult to collect benefits in the “show me” state. Among the provisions in the new law was a 20 to 50 percent reduction in indemnity for workers who are injured while wilfully ignoring the employer’s safety program.
Which brings us to Dennis Carver, a roofer who worked for Delta Innovative Services in Kansas City. Carver was carrying a 100-pound roll of composite weather barrier up a ladder – no easy task! – when he injured his back, resulting in a permanent total disability. The problem was that Delta had a safety policy that required three point contact with a ladder at all times: it would be physically impossible to carry a 100 pound roll and maintain three point contact. Because he violated the policy, Carver’s indemnity was cut in half, from $743 per week to $371.
Carver admitted that he went to work with the intent of violating the policy. He knew that instead of having the usual crew of 11 men on the job, the crew that day would total two people: himself as foreman and one other crew member working in a separate area. He knew full well that he was on his own. He also knew that company policy required that he use a hand pulley or power equipment – or request the assistance of a coworker – to lift materials to the top of a ladder.
Delta argued that Carver caused his own injury by failing to follow its “three-point” safety rule. Slam dunk for the employer? Here is the statute:

[w]here the injury is caused by the failure of the employee to use safety devices where provided by the employer, or from the employee’s failure to obey any reasonable rule adopted by the employer for the safety of employees, the compensation and death benefit provided for herein shall be reduced at least twenty-five but not more than fifty percent; provided, that it is shown that the employee had actual knowledge of the rule so adopted by the employer; and provided, further, that the employer had, prior to the injury, made a reasonable effort to cause his or her employees to use the safety device or devices and to obey or follow the rule so adopted for the safety of the employees.§ 287.120.5
“The burden of establishing any affirmative defense is on the employer․ In asserting any claim or defense based on a factual proposition, the party asserting such claim or defense must establish that such proposition is more likely to be true than not true.” § 287.808.

The Checklist
Thus the statute presents a checklist for reducing indemnity payments:
1. that the employer adopted a reasonable rule for the safety of employees; CHECK
2. that the injury was caused by the failure of the employee to obey the safety rule; CHECK
3. that the employee had actual knowledge of the rule; CHECK and
4. that prior to the injury the employer had made a reasonable effort to cause his or her employees to obey the safety rule. NOT SO FAST!
Theory and Practice
While Delta’s owner, Danny Boyle, testified that “[n]ormally our guys are trained ․ [that] the only thing that should be carried on a ladder is the person himself,” he then testified that employees routinely violated that rule:
Q. Does that mean nobody ever carries anything?
A. Not at all. Guys tend to do things wrong all the time.[emphasis added]
Q. And that’s what–
A. I’m just being truthful.
Q. Sure. It happens. It’s faster to carry it up sometimes?
A. Yes.
Q. Because you’re trying to finish a job and get something done, you may carry something up a ladder as opposed to using the beam?
A. Yes.
Q. Or the pulley?
A. Yes.
Even though Boyle was aware of multiple instances in which employees had failed to follow the three-point rule, he was unable to provide any testimony concerning discipline imposed on noncompliant employees. In other words, the policy was not enforced. And because it was not enforced, Delta must own the consequences of employees failing to follow it.
The Court of Appeals remanded this case back the workers comp commission, for a closer examination of whether there were grounds for reducing the indemnity payments. In all likelihood, Carver will collect the full indemnity.
Roofers at Risk
Boyle’s testimony that “guys tend to do things wrong all the time” reminds me of a telling moment in a training session some years ago. I was explaining the implications of implementing a drug testing program and the owner of a small roofing company responded: “I could never do that. Half my guys would fail.” [Need I add that, following the seminar, I alerted the underwriter to flag that account for non-renewal?]
Would it surprise you to learn that roofing is one of the most expensive job classes in workers comp? The rates can run as high as $50.00 per $100 of payroll and even higher. It is difficult, demanding work. In some respects, there is no such thing as a good day for a roofer: it’s either too hot, too cold, or too windy. The exposures are relentless and the work itself, especially on the commercial side with hot tar involved, can be noxious.
Owners of roofing companies like Danny Boyle are faced with a daily conundrum: do I enforce the rules and slow down the work? Do I discipline employees for violations or let the work flow, hazards be damned? In the course of normal employment, it’s tempting to ignore the finer points of safety. But that puts workers at risk for serious injuries – and owners at risk for footing substantial bills.

Annals of Compensability: Of Heroes, Acts of God, and (No) Mercy

Monday, October 24th, 2011

When the category 5 hurricane hit Joplin, Missouri on May 22 this year, Mark Lindquist was perched on a mattress which covered his clients, three mentally disabled adults. Lindquist, a social worker for Community Support Services, was following the tornado protocol in a town where basements are virtually non-existent. Unfortunately, the protocol proved utterly ineffective in the wake of 200 mile per hour winds. Lindquist was plucked from his perch and hurled a block away. He was impaled on debris, with every rib broken, his shoulder destroyed and most of his teeth knocked out. He was put into a coma for about two months, nearly dying from Zyomycosis, a rare fungal infection that killed 5 other victims. And to top things off, his three clients perished in the storm.
Lindquist’s survival is well beyond the expectations of his doctors. His right arm remains in a sling, but he has use of the hand. An eye that was temporarily blinded has full sight. He moves slowly and has short-term memory loss, but is able to speak clearly.
A Hole in the Safety Net?
Lindquist assumed that workers comp insurance would cover his medical costs (a whopping $2.5 million), pay for his 12 daily meds and provide indemnity for his lost wages. (As a low wage worker, Linquist could not afford health insurance.) His assumption of coverage has proved naive. He certainly was “in the course and scope of employment.” However, under Missouri law, Acts of God are only covered by workers comp if work exposes the individual to unusual risk. If, on the other hand, there was no greater risk for Lindquist than that facing the general public at the time of the tornado, the injury is not compensable. Lindquist was working – heroically – but the work itself did not cause the injuries. His claim has been denied.
End of story? Not quite. Certainly a case can and will be made that by lying on top of a mattress, in that particular location, Lindquist was more exposed to harm than the general public. He will be able to show that had he not been working, he might have been able to drive his van out of harm’s way. Given the high profile of his claim, he is likely to prevail at some point in the process.
It’s worth noting that of 132 comp claims filed in the tornado’s aftermath, only 8 have been denied. It may have been an Act of God, but somewhere along the line there will be an act of mercy to help a courageous worker rebuild his shattered life from the ground up.
Thanks to Mark Walls and his Workers Comp Analysis Group for the heads up on this story.

Health Wonk Review, Illinois reform, Missouri SIF, mobile risks & more news notes

Thursday, June 9th, 2011

Health Wonk Review – John Irvine & Matthew Holt host a hefty edition of Health Wonk Review over at The Health Care Blog – lots of good health wonkery there!
Illinois work comp reform – After all the sturm und drang in the Illinois reform process, we’ve had a breakthrough … a reform bill finally passed on the last day of the legislative session. In a Tale of Persuasion, AP’s Zachary Colman takes you step by step through the painful process. And at Managed Care Matters, Joe Paduda offers an excellent rundown of some of the key provisions in the Illinois work comp reform bill.
In other Illinois news, the matter of $10 million in repetitive stress claims filed by Menard County prison guards has taken some new twists. The Illinois house recently passed a bill requiring the release of the related workers’ comp test records in compliance with the Freedom of Information Act. A report obtained through the FOIA shows that locking and unlocking prison cells didn’t injure the guards.
Missouri’s second injury fund woesInjured workers in Missouri are being left in the lurch, according to a story in stltoday.com. about the state’s troubled Second Injury Fund Roberto Ceniceros posts more about Missouri’s financially-ill second injury fund.
Mobile risks – Andrew Simpson writes about the increased workers comp exposure as more workers go mobile in Insurane Journal. In the past, the workplace was a clearly defined place and the hours of operation were also clearly defined, but as more and more workers go mobile, things are much less clearly defined – the lines between professional and personal life are blurring. Plus, employers are often supplying the mobile devices to workers, increasing their exposure to claims that occur when off site or off the clock. “Insurance claims professionals say claims made by workers injured while doing things where the relation to their employment is unclear are on the rise and the increasing use of mobile devices is challenging traditional notions of work-related injuries.”
Workplace violence factorsThe Workplace Violence Blog posts about the prevalence of workplace violence as evidenced by a Society of Human Resource Management survey, and states that “Approximately $55 billion a year is lost to litigation awards, property damage and lost productivity from workplace violence. It is estimated that productivity can drop as much as 50% in the six to eight weeks following a workplace violence incident.” The post includes seven common organizational factors that contribute tow workplace violence.
Industry growth – Insurance is one industry that is poised for growth. According to a recent research report issued by IBISWorld, employment in TPAs and and claims adjusting is set to grow 5.7% annually between now and 2016. “Other industries in the IBISWorld top 10 fastest-growing for the next few years include sustainable building material manufacturers, multi-family home builders, used car dealers, remediation and environmental cleanup services.”
MRSA facts from the CDC – From the CDC, MRSA and the workplace, including a list of frequently asked questions. Staph infections, including antibiotic resistant MRSA, MRSA skin infections can occur anywhere. However, the CDC notes that some settings have factors that make it easier for MRSA to be transmitted. These factors, referred to as the 5 C’s, are as follows: Crowding, frequent skin-to-skin Contact, Compromised skin (i.e., cuts or abrasions), Contaminated items and surfaces, and lack of Cleanliness. Locations where the 5 C’s are common include schools, dormitories, military barracks, households, correctional facilities, and daycare centers.

Re: Re-Insurance

Monday, May 23rd, 2011

With yesterday’s catastrophic tornadoes in Joplin, Missouri, the most recent in a long line of 2011 disasters, the cost of re-insurance is going up. Prior to yesterday, the reinsurance bill for 2011 stood in the vicinity of $50 billion, leaving virtually no room for additional losses through the end of the year. Alas, we now have Missouri, and the year is not even half over, with hurricane season yet to begin.
Risk & Insurance magazine highlights the problems facing reinsurers:

Yvette Essen, an analyst for A.M. Best, said that the catastrophic first quarter means that many reinsurers will struggle to record any full-year underwriting profit for 2011.
“The industry faces further challenges in achieving profitability as the hurricane season approaches and investment yields remain low,” she commented.
“While reinsurers continue to maintain sound capital positions, the excess capacity that existed at the prior year-end has clearly been diminished,” he said.

Richard Ward, CEO Of Lloyd’s of London, warns that the relatively inexpensive cost of insurance is really an illusion: “Prices are dangerously low at present,” he told an industry conference. “Clients may think they are getting a bargain. But the fact is that they are buying security. The insurers who write unprofitable business are inevitably the first to collapse when disaster strikes.”
Beyond Risk Transfer
It appears we are entering a period of steadily increasing instability in nature. Ferocious storms and floods in the US, the Japan earthquake and tsunami, the volcano in Iceland, the fires in Australia – all flitter across our computer screens and raise the specter of inconceivable loss. Insurance – where it’s available – merely provides capital for rebuilding. Much of what is lost cannot be insured and even where there is insurance, what is lost on a personal, family-to-family level cannot be replaced. Yet we see selfless efforts to help survivors, most of whom will demonstrate a remarkable ability to endure. So much of what is precious to these people has been lost, but they will move on. That’s human nature at its best.
Meanwhile, the reinsurance market, long in the soft-market doldrums, will finally begin to harden. We will all pay a little more for insurance – and we will complain about it. That, too, is human nature, not at its best, perhaps, but a reflection of these tumultuous times.

Health Wonk Review, NCCI, networks, Missouri, and more

Thursday, May 15th, 2008

Jason Shafrin of Healthcare Economist hosts this week’s edition of Health Wonk Review in newspaper style – it’s lean and clean, and packed with interesting pointers to the latest news.
NCCI conference – Peter Rousmaniere attended the annual NCCI Conference this year and reports back on his findings, posted at Joe’s place.
When less is more – Joe Paduda of Managed Care Matters beats a drum that needs beating. Why do buyers use unit cost reductions rather than total cost reductions as a metric of savings in measuring network performance? It’s a perverse incentive that encourages utilization.
You-Don’t-Say Department – a recent survey of small businesses shows that many are spending work comp dollars without knowing what they’re buying. About one out of every seven couldn’t name their insurer and don’t understand their coverage. In a related survey, almost one in five respondents who had just switched to a new insurer weren’t able to name that insurer. Our experience has been that small employers often learn about workers comp the hard way – it would be great if as an industry, we did a better job communicating what workers’ comp is and how it benefits both employers and employees.
Missouri gets tough – Missouri employers who try to cut corners by not carrying workers comp should think twice – the Supreme Court recently upheld a felony conviction for an employer that failed to carry workers comp coverage for his employees. The conviction includes one year in prison and $30,000 in fines and penalties. (More about the Court’s proceedings.)
Useful resource101 little known scholarship sources for nurses – a good reference list for both undergraduates and graduates.
And the winner is… – In an interesting bit of insurance trivia, Fireman’s Fund Insurance names the riskiest film of 2007.

State news briefs

Thursday, October 30th, 2003

Workers Compensation Fund Sues State of Utah
“This dispute has been long standing. WCF believes that the assets of the company are owned by its policyholders – that it is a mutual insurance company. WCF began in 1917 with $40,000 in seed capital from the State…This action is even more necessary now with last week’s announcement that WCF intends to spin off its subsidiary, Advantage Workers Compensation Insurance Company. “

Missouri: State reduces workers compensation insurance tax
“The state will reduce a tax that businesses pay on workers’ compensation insurance, a move that state officials say will save Missouri employers $12 million a year…The cut applies to a 2 percent tax that employers pay on workers’ compensation insurance premiums. “