Posts Tagged ‘uninsured’

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Health Wonk Review, Worker Memorial Day, OK, Obesity, Appendectomies & more

Thursday, April 26th, 2012

Health Wonk Review – Jennifer Salopek and Sarah Sonies have posted Health Wonk Review: Shiny Happy (Mostly) Edition, an excellent hosting debut at Wing of Zock, a blog sponsored by the Association of American Medical Colleges for practitioners of academic medicine. Make sure you click through to learn the origins of the fanciful name of the blog.
April 28 is Worker Memorial Day – an event dedicated to remembering those who died on the job from workplace injuries and diseases. It’s also a time to commit to doing better, to renew efforts for safe workplaces. The National Council for Occupational Safety & Health has a list of Workers Memorial Day events throughout the country, as well as fact sheets and resources in both English and Spanish.
Oklahoma decides against “alternative workers comp” – Last week, the Oklahoma Senate gave the nod to a bill that would allow some employers to opt out of workers comp system by offering a comparable alternative, but the OK House rejected the opt-out measure. Last week, Senator Harry Coates had issued an editorial discussing the opposition viewpoint: Be careful what you ask for. See Dave DePaolo’s take on OK’s non-subscription model and the recent Walmart opt out in Texas.
Is it OK to discriminate against obese people? – In what may be a first among hospital hiring restrictions, Victoria Hospital in Texas has stated they won’t hire very obese workers. HR pro Suzanne Lucas (also known as “Evil HR Lady”) asks if it is okay to discriminate against obese people, offering 5 reasons why she feels it is a bad policy. In addition to potential illegality, another issue she raises is that many health professionals consider the BMI or Body Mass Index a faulty indicator of health. The first link quotes a physician as noting that “A professional football player might have a body mass index of 32, which is technically obese, but only have 7 percent body fat.” (Be sure to check out the Flickr gallery of real people and their BMIs that Lucas links.) Now whether or not this is the wrong “solution,” the fact that obesity is a workplace problem is not at issue. A new Cornell study says that obesity accounts for almost 21% of U.S. healthcare costs, and “An obese person incurs medical costs that are $2,741 higher (in 2005 dollars) than if they were not obese.”
Usual and customary? – How much will an appendectomy cost you in a California hospital? It might depend on your insurance coverage. In one hospital, the cheapest procedure was $7,504 and the highest cost in the same hospital was $171,696. See more in Merrill Goozner’s post on the Anatomy of A Walletectomy.
Jail time for scofflaws/ – Jon Gelman notes that North Carolina is raising the stakes for employers that don’t carry workers comp – “the first contempt hearing is scheduled for May 22 when 125 uninsured employers have been noticed to appear in court.” The state says pay up or go to jail.
Sex, workers comp & horseplay – Joe Paduda posts about compensable sex on the road, an Australia case where a worker was injured while in flagrante delicto. My colleague discussed this case previously in his post Compensable Sex, Down Under? We don’t get to talk about sex very often on this blog, although there was a spanking incident a number of years ago (sadly the link to the news item appears broken.) The spanking post dealt with an instance of horseplay – an issue that Cassandra Roberts poss about at LexisNexis in her post A Roll In the Hay: Delaware’s Horseplay Defense and Australia’s Sex Romp Case Revisited, where she lists an array of quirky cases in which the horseplay defense failed.
More Noteworthy News

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GCs in MA: Comp’s Not-So-Exclusive Remedy

Wednesday, May 25th, 2011

Henry C. Becker Custom Building Limited was doing some construction work in Newburyport MA. They hired the Great Green Barrier Company to do some waterproofing. They apparently did not ask for a certificate of insurance; Great Green Barrier did not carry workers comp for their employees. There was an explosion on the jobsite. Timothy Wentworth, an employee of Great Green Barrier, was killed; his son, Ezekiel, was severely injured. As the employees of an uninsured subcontractor, the Wentworths collected workers comp through Becker’s insurance company, which paid out substantial lump sum settlements to each.
Then the Wentworths sued Becker as a third party. Becker objected: comp, after all, is an exclusive remedy. Once the Wentworths collected comp benefits, they should be precluded from any other remedies. Becker sought and won a summary judgment dismissing the lawsuit.
The case wended its way to the MA Supreme Judicial Court, where the justices determined that the summary judgment was improper: the exclusive remedy provision of the comp statute applies only to employees. The Wentworths were not employees of Becker, but of Great Green Barrier. Becker, in other words, was a third party and thus, despite the payment of comp benefits, was not immune from lawsuit.
Compounded Liabilties
Becker is going to pay and pay again: first, under their workers comp policy, the payroll for Great Green Barrier employees will have been added to the Becker payroll in the premium audit; that’s the chump change. Then, the substantial losses for the Wentworths – each likely exceeding the state rating point limit of $175,000 – will be added to the experience modification calculation for Becker over a three year period. That’s serious bucks (but nowhere near the financial hit taken by Becker’s comp carrier).
Then, given this ruling, the Becker company is vulnerable to a lawsuit, which is likely to result in additional payments to the Wentworth family. The MA Supreme Court has made it crystal clear: general contractors are liable for the comp costs of uninsured subs, but the acceptance of comp benefits does not preclude a third party lawsuit.
The lesson for GCs should be clear: proper risk transfer must be a fundamental part of the operation. Make sure subcontractors carry workers comp: require that any and all subs produce a certificate of insurance, with the GC named as an additional insured. Track the expiration dates on the certificates and do not allow subs on the job site unless they have shown that comp (and liability) policies are in place.
Henry C. Becker Custom Building has learned about risk transfer the hard way, an expensive lesson indeed. May a word to the wise be sufficient.

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Holiday Health Wonkery and other news briefs

Friday, December 10th, 2010

Brad Wright has an excellent holiday edition of Health Wonk Review posted at his blog, Wright on Health – check it out! It’s the last issue until 2011 so fill up on your health wonkery now!
And in other news briefs….
Nix on the Mine Safety Bill – Ken Ward of Coal Tattoo reports that an attempt to resurrect a major mine safety reform bill was defeated in the House of Representatives, but that the House did approve more funding for mine safety.
The Most Influential People in Workers Comp for 2010 – as designated by Workers’ Comp Executive – hat tip to Roberto at Comp Time for the pointer.
Healthcare reform and workers comp – Joe Paduda or Managed Care Matters offers his analysis of the SwissRe analysis of health reform and workers comp.
Health Care and the Uninsured – HealthLawProfBlog offers helpful links to important parts of the updated Kaiser Family Foundation’s Commission on Medicaid and the Uninsured.
The Bunkhouse Rule – Do you know what this is? If not, Judge Tom offers a good example.
Overview of Wal-Mart Stores Inc. v. Dukes – atty. Gerald Maatman presents a backgrounder and overview of the class action gender discrimination suit against Wal-Mart which is being heard by the Supreme Court.
Eight tips for meeting with a potentially violent employee – tips from attorney Robert Bettac’s recent presentation at BLR’s National Employment Law Update are posted at HR Daily Advisor.
Worried about scanner-related radiation? – Check out this line of radiation shielding and privacy undergarments. Not sure if they work, but they are a hoot.
A few new-found resources

  • Actuary Info Blog – we’ve linked to this smart blog before – it bills itself as a “brain teaser Blog with non-conventional, witty, remarkable and serendipitous financial and actuarial related news.” There are some fun and thoughtful entries.
  • The OSHA Updater – a safety blog by Chad Marshman of the EasySafetySchool.com
  • DocuBase – a hand-picked selection of resources, reports and publications from government agencies, NGOs, think thanks and other public interest organizations
  • Safe Lifting Portal focuses on patient safety and caregiver injury prevention, sponsored by Liko, a designer and manufacturer of lifts, slings and patient transfer accessories.
  • Crowd Management Safety Guidelines for Retailers – an OSHA Fact Sheet

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Tewksbury (Finally) Opts In

Tuesday, June 15th, 2010

There are five towns in Massachusetts that do not carry workers comp insurance for their employees. Four of them – Dana, Prescott, Enfield and Greenwich – are under 412 billion gallons of water: they were submerged during the 1930s in the making of the Quabbin Reservoir, which supplies drinking water to Boston and a number of suburban cities and towns. The fifth, Tewksbury, voted to join the workers comp system way back in 1914, but a clerical error recorded the positive vote as negative, resulting in nearly 100 years of a go-it-alone, pay-as-you-go, hope-for-the-best approach to comp among the residents of the town, now nearing 30,000 people.
To date, Tewksbury has been pretty lucky. The town has paid out between $100,000 and $189,000 per year for claims in recent years. That’s not bad, considering that one failed back can run upwards of $500,000. But just because Tewksbury has been lucky does not mean they are going to stay lucky. The liability to the town’s tax payers is precariously open-ended. In these challenging times of reduced budgets for all municipal services, the specter of an unanticipated claim could put Tewksbury on the verge of bankruptcy. Because the town did not participate in the comp system, injured workers had the option of suing for damages unavailable in the comp system.
As we read in Insurance News Net, last month the town meeting voted to adopt workers comp coverage. (Presumably, the vote was properly recorded this time.) It will take a few years to develop an experience rating, based upon actual losses and statutory benefits. Overall the cost of insurance will run a bit higher than an average loss year, but that’s price you pay for transferring the risk to a third party.Comp will finally become a set cost in the town budget. A workers comp policy comes with a comfort factor that cannot be measured simply in premium dollars: any claims, large or small, any catastrophic losses involving multiple town employees, will now be covered by insurance. That should help town residents and officials sleep a little better at night.
As for the surviving citizens of Dana, Prescott, Enfield and Greenwich, displaced long ago by the state’s appetite for water, comp is not a likely component in their dreams. I imagine they welcome a nocturnal glimpse of the communities where they once lived and waken with sense of sadness and of loss.

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Focus on fraud

Tuesday, October 13th, 2009

States offer public tools to curb premium fraud
Massachusetts has recently announced an online tool to verify that an employer has workers’ compensation coverage. The tool can be accessed from the Department of Industrial Accidents site.
In addition to helping employees to verify that they will be covered should they be injured on the job, businesses may also want to verify that their competitors are not gaining unfair advantage by avoiding their workers compensation obligations. Officials say the stated goals of the program are to:

  • Permit homeowners to ensure that hired contractors have workers’ comp insurance
  • Allow general contractors to ensure that all subcontractors are properly insured
  • Assist medical providers with coverage questions when treating an injured worker
  • Aid state and municipal officials with ensuring workers’ comp compliance with licensing, permitting, and awarding public contracts
  • Help protect employers from agent and broker fraud allowing them to verify their own coverage

State officials have noted that 36 other states have similar public services online – we’ve seen such services on the NY, CA, FL, IL and TX workers’ comp sites, although on some sites, it can be a devil of a time to find the services. See All 50 States’ and D.C.’s Home Pages and Workers’ Compensation Agencies
While most states have some type of anonymous fraud reporting system on their websites, some states are getting more aggressive than others in promoting their services to the public. Florida has been touting the results of their workers comp whistle blower site, which allows citizens to submit referrals of alleged violations of workers compensation rules. As of August, after only two months of operation, the site had already produced hundreds of new complaints and over $500,000 in penalties. Fraud reporting systems aren’t just for reporting noncompliant employers. They can also be used to report suspected employee, physician, or attorney fraud related to workers comp.
Fraud is on the rise
According to the National Insurance Crime Bureau, workers comp fraud referrals were up by 2% in the first half of 2009. Premium fraud was down by 21%, but other types of fraud such as medical provider fraud and claimant fraud have risen.
Steve Tuckey is currently writing an in-depth series on fraud for Risk and Insurance. The first installment, Transparency of Evidence, deals with fraud by doctors, hospitals and other healthcare professionals. He notes that “grayer areas of so-called abuse or overutilization continue to vex payers, insurance companies and lawmakers eager to maintain the financial stability and integrity of the system that has protected workers for nearly a century.” Evidence-based medicine standards are helping to curtail both the egregious fraud as well as “softer” abuses. Part 2, Vanishing Premiums, deals with the issue of premium fraud and the myriad schemes employers use to avoid paying their fair share.
Social networks provide clues
Some employers and insurers are finding that social networking sites are a useful new tool in com batting employee fraud. In fact, in many cases, fraudulent employees are outing themselves as cheats by bragging about false claims or posting photos or videos of themselves engaging in activities that are incompatible with the injuries they are claiming.
“Some claimants supposedly too disabled to work post locations and dates for their upcoming sports competitions or rock band performances, boast of new businesses launched, and include date-stamped photographs of their physical activity, investigators say.
Others have openly bragged about fooling their employers with “Monday morning” workers comp claims for injuries that occurred the weekend prior and away from the workplace.”
However, employers need to ensure that they stay within the law when using online information about employees. New Jersey attorney Jonathan Bick suggests some best practice policies for employers when mining social networks. The issue of employee privacy can be a murky one. A good rule of thumb is that an employer should avoid duplicitous methods to spy on private, nonpublic pages – a New Jersey jury recently upheld a group of employees’ rights to privacy in just such a case. Information that employees post to public pages may be another matter. As Bick notes, “In order for a person’s privacy to be invaded, that person must have a reasonable expectation of privacy.”

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Annals of Fraud: Corrections Officer in Need of Correcting?

Thursday, October 8th, 2009

Stephen Zaczynski, 49, is a lieutenant with the Connecticut Department of Correction. He claimed an on-the-job injury in September of 2008 and collected over $12,000 in benefits. While on disability, he continued to run a company he co-owned, New England Pellet. People in need of pellets pre-paid for the product, which, unfortunately for them, was never delivered. The company closed soon after Zaczynski went out on comp and filed for bankruptcy protection in January. To complete the trifecta, it appears that Zaczynski did not carry workers comp protection for his employees.
Let’s see if we’ve got this one straight: Zaczynski collects comp for an injury that did not disable him, freeing him up to run a business that did not deliver the product that his customers paid for – a product at least theoretically handled by employees who were not covered by workers comp insurance. (Perhaps they were “independent contractors”?)
Zaczynski has a court date on October 20, where he faces charges of first-degree larceny, workers comp fraud and failure to maintain workers comp insurance.
His attorney, Jim Oliver, denies all the charges: “I do not believe that a crime has been committed by Stephen. We intend to vigorously defend all claims.”
Oliver may have a case. In not delivering the pellets, Zaczynski perhaps was not performing work that exceeded the medical restrictions that kept him out of work. (We have no way of knowing whether the DOC tried to bring him back to work on light duty – as a lieutenant, this would surely have been an option.) While not delivering the product reduced the workplace hazards for his employees – less material handling, for sure – Zaczynski would still be required to provide workers comp protection, assuming these folks were, in fact, employees of the company. There’s usually not a lot of wiggle room on that issue.
Finally, failure to deliver the pellets certainly appears to be a form of larceny, but theft on a much bigger scale worked out pretty well for the giant banks, mortgage companies and insurers, so perhaps it can work for Stephen, too. In the final analysis, his problem may be one of scale: he just didn’t think big enough. If you’re not going to deliver the goods, you want to screw people out of more than a few pellets for a stove. Next time, Stephen, think big, really big. It’s the American way.

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Homicidal Employers

Wednesday, July 29th, 2009

Back in May, we blogged the appalling story of Albania Deleon, a legal immigrant who founded Environmental Compliance Training (ECT), the largest asbestos removal training school in New England. Despite the fact that the training only requires 32 hours, she frequently sold certificates of completion to “students” who never attended classes. In other words, she sent these marginal workers – many of them undocumented – into asbestos-ridden jobsites with no preparation whatsoever.
Well, Albania, meet Chong-mun Chae, an illegal immigrant who ran a Queens-based asbestos removal company apparently modeled on ECT standards. Chae claimed to have only one employee, a receptionist. In other words, his company removed asbestos from job sites all over New York, but he accomplished this without any workers. By calling his workforce “independent contractors,” he avoided workers comp premiums to the tune of $1.6 million. As we read in the New York Times, Chae has been sentenced to 4 years in prison, to be followed by deportation to South Korea.
Chae avoided detection for over a decade by frequently changing the name of the company. He was not without a sense of humor – let’s call it diabolical – as one of his company’s incarnations was “Charlie Brown Services.” His premium avoidance scheme was exposed when an investigator read a report filed by Chae stating that he had no workers. You might think that a connection would easily be made between a company with hundreds of thousands in billings and no payroll, but that was not the case. In our collective haste to get rid of asbestos, we try not to think very much about the people actually performing the work.
Killer Jobs
Chae, like Albania Deleon, is getting off lightly. After all, he has only been convicted of insurance fraud. At some point in the not-too-distant future, when Chae is enjoying his retirement in South Korea, he will be guilty of murder, as his phantom workforce and their families succomb to debilitating lung disease. We don’t know who they are or where they live. Collectively, perhaps we don’t really care.
Entrepreneurs like Chae and Deleon exploit the margins of the working world, removing a deadly menace in a deadly manner. They offer jobs that pay relatively well, to a workforce that labors in the shadows. Chae and Deleon are nothing less than murderers. It’s too bad that our system of justice is incapable of holding them accountable for their deeds.
If hell operated a dating service, surely the decrepid Chae and the fugitive Deleon would be a match: at 71, he is a lot older, where Deleon is a single mother with a now-abandoned 3 year old child. Despite the difference in ages, however, they have a lot in common. They have ruined hundreds of lives, wreaked havoc on thousands of families and reaped the profits of a corrupt business scheme. With values like those, age is surely no barrier.

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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 resource – 101 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.

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Left and Right Converge on Health Care Coverage

Tuesday, May 31st, 2005

We continue to track the national crisis in health care coverage. we’ve blogged it before and we’ll blog it again. As of 2003 about 45 million Americans lacked health insurance. Of these, there are about 20 million American workers without health coverage, which comprises a seismic undercurrent in workers compensation. Health care coverage tends to follow income: the lower your income, the more likely you cannot afford health insurance. The Kaiser study, which we cited back on April 6, notes that 40% of the workers without health insurance have less than a high school diploma. Twenty two percent of the uninsured report their health as “fair or poor.” In addition, about one third of uninsured workers rely on physical labor for their living. These three overlapping groups are at especially high risk for prolonged disability under workers comp. It’s probably no coincidence that Texas, the state with the highest incidence (27%) of non-covered workers is also the state where workers with a low education are most likely to receive permanent disability payments.
A recent article in the Boston Globe (registration required) by Theo Emery of the AP notes that Massachusetts has joined the ranks of the states singling out large employers who fail to offer coverage to all their employees. The state pays more than $52 million a year to cover workers in a broad range of jobs, from universities and hospitals to the U.S. Postal service. Four employers — Dunkin Donuts, Stop & Shop, Walmart and McDonald’s – have more than 1,000 employees each who received public health benefits. Now there is talk of surcharging these and similarly situated employers. Any such surcharge would provide political fireworks indeed!
Coalition of the Stymied
So I was pleased to read Robert Pear’s article in in the New York Times (registration required) that a group of 24 leaders representing health care, business and workers has been meeting quietly to hash out a concensus for providing coverage to the uninsured. The participants range from the liberal Families USA to the conservative Heritage Foundation, the U.S. Chamber of Commerce and the National Association of Manufacturers (NAM). The group also includes the AARP, the A.F.L.-C.I.O. and the American Medical Association. I am encouraged that, first, they agreed that there is a major problem; second, that they can meet in a room together and just talk and listen to each other; and third, that despite their ideological differences, they might be able to agree on some solutions.
So far they are focusing on proposals to expand coverage to as many people as possible, as quickly as possible. They recognize that there are many reasons for people being uninsured, so rather than trying to come up with a “one size fits all” solution, they are exploring more flexible models.
Neil Trautwein, assistant VP for NAM, compares the talks to medieval alchemy, bringing together disparate and volatile ingredients: “It could produce some wondrous proposal, or could blow sky-high.”
Thus far, here are some of the options they are exploring:
Tax credits to help parents provide insurance for children.
Deduction programs for employees whose employers do not offer health insurance; the employee contributions would be matched by other sources to provide coverage.
Tax credits to small businesses to help pay for insurance.
Expansion of Medicaid.
Federal grants to states to help them establish insurance purchasing pools.
Aggressive Timetable
The working group hopes to have a specific proposal by the end of the year. They have no illusions about the scale of this effort. As Stuart Butler of the Heritage Foundation says, “it’s a coalition built of frustration. True believers on the left and the right have been stymied on this issue.” Here’s wishing them the best of luck in this essential endeavor. We’ll keep you posted.

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Trading tax cuts for health care?

Sunday, April 11th, 2004

How important is health care to the average American? We certainly knew it was important, but an article in bizjournals about a recent poll on health care conducted by the Commonwealth Fund drove the point home: It is apparently important enough that “62 percent of Americans would be willing to give back all of the recent federal tax cuts in exchange for universal health insurance coverage.”

And also on the topic of health care coverage or the lack of it, read 10 Myths of the Uninsured, testimony presented to a congressional committee by economist Len Nichols, Ph.D., vice president of the Center for Studying Health System Change (HSC). He pokes holes in many common assumptions about health care, including the idea that American businesses pay $400 billion a year to provide coverage for workers, stating that “Economists believe that ultimately most workers end up paying for health insurance in the form of lower wages.” Thanks to Pulse for pointing us to this article.

George’s Employment Blawg also has a good post on health care issues, including a link to a report entitled Health Care Benefit Crisis: Cost Drivers and Strategic Solutions (note: 30 page pdf file) by Eric Parmenter of Grant Thornton. We will quote George in summarizing it:

Packed with facts and figures, this document begins with a comprehensive, yet concise analysis of sources of increases in health care benefit costs, including: the aging of the baby boomers, costs of new technology, legislative initiatives such as HIPAA, “managed-care saturation,” “direct-to-consumer prescription marketing,” “insurance industry consolidation and profit-taking,” our “litigious society,” poor health care quality, “preventable and avoidable accidents and health problems,” lack of insurance, and “consumer cost insulation.”

Rounding out our reading on the health care crisis, Tom Mayo at HealthLawBlog updates us on recent developments on the issue of drug costs. Tom says: “Who knows? Maybe drug costs will be the leading edge of a health-care reform movement that drags the country, kicking and screaming, into universal coverage (maybe single-payer, but probably not).”

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