Tag Archives: Reform

Cries of High Costs and Fraud – Watch for Reforms

Today’s post comes from guest author Kit Case, from Causey Wright.

There is always discussion, in every state, about the expense of workers’ compensation insurance to employers. It is common to hear stories of corruption and fraud when employer costs run high. This discussion can lead to cries of fraud, usually with fingers pointed towards claimants and often tied into efforts to reduce benefits to injured workers. As a recent example, take a look at the article published on July 23rd in the Fresno Bee, written by Dan Walters of CALmatters, titled “California workers’ compensation system plagued by high costs and fraud.” In the article, Mr. Walters points to Southern California as an area particularly afflicted by fraud, inserting the hot-button phrase “immigrant workers,” as follows:

“Why Southern California? Its large numbers of immigrant workers are easily persuaded by recruitment agents, called “cappers,” to file claims that allow unscrupulous lawyers and medical providers to milk inflated payments for nonexistent injuries.”

Mr. Walter’s statement is misleading and inflammatory. The link provided by Mr. Walters to support his claim of fraud leads to a news piece – not a study – released by the Center for Investigative Reporting on their “Reveal” radio and web platform.  

The story on Reveal, titled “Profiteering masquerades as medical care for injured California workers,” published in March of 2016, focuses on fraud within the medical component of the workers’ compensation system.  It makes no mention of “immigrant workers” although there is discussion of Spanish-language service providers within the article. The conclusion of the Reveal piece describes injured workers as the real victims of the scams they investigated.

From our experience representing injured workers in Washington State, we see very little in the way of fraudulent acts, by medical providers, injured workers, insurance carriers or employers. In our cases, the fraud we encounter most, on both small and large scales, is committed by employers. We see misclassification of workers to reduce premium rates paid or the failure to provide coverage of a worker by stating they are independent contractors.  We see inaccurate data about earnings and overtime provided by employers in an effort to reduce compensation paid to injured workers and even outright lies about the circumstances of an injury to try to keep a claim rejected.

We do, however, see inefficiencies, on a daily basis, usually under the guise of cost management. Claims managers spend an incredible amount of time and energy micromanaging claims, segregating medical conditions from claim coverage, delaying or denying medical treatment authorizations, sometimes leading to litigation with months, or even years, involved and no relief from legal fees or costs for the claimant, even if successful at trial. In most cases, private insurance policies will not authorize treatment or surgery when a workers’ compensation claim is involved until the litigation has been concluded and the responsibility for coverage is clearly under their policy.

Fraud is a problem whenever it occurs, whomever is committing the fraudulent acts. To hear the cry of “fraud!” – especially when peppered with phrases like “immigrant workers” –  is a good warning bell. These cries often indicate another round of injured worker benefit cuts will soon be on the table. Watch for more news stories, videos of an injured worker riding a jet ski, and you’ll know there’s soon to be “reforms” proposed.

“The “grand compromise” is just as valid today as it was in 1914, but it could collapse if costs – and the fraud and other unseemly aspects of work comp that drive them – are not tamed. The next overhaul should be systemic, not just another backroom deal.” – Dan Walters

An efficiently run system run with fairness and respect and a focus on a speedy, full recovery after an injury and limiting lost wage earning capacity for workers permanently injured on the job should be the goal of all of the players within a workers’ compensation system. Cost savings and improved outcomes can both be achieved. These goals are best met through broad-based efforts to work together on the full spectrum of issues rather than singling out one or more of the segments – doctors, lawyers, claimants, carriers or government agencies – as the primary culprit. There’s room for improvement in all of these segments.

Photo credit: Kit Case

Call “Reform” What It Is: Death By A Thousand Cuts For Workers’ Rights

Today’s post comes from guest author Catherine Stanton, from Pasternack Tilker Ziegler Walsh Stanton & Romano.

This week I attended the 20th anniversary of the Workers’ Injury Law and Advocacy Group (WILG) in Chicago. I am a proud past president of this group – the only national Workers’ Compensation bar association dedicated to representing injured workers.  

As an attorney who has represented injured workers for more than 25 years, I have seen their rights and benefits shrink under the guise of “reform”. After the tragic Triangle Shirtwaist Factory fire in 1911, which killed almost 150 women and girls, workplace safety and Workers’ Compensation laws were enacted. For the next half century or so, many protections and safeguards were implemented. However, many of these reforms were not sufficient, and in 1972, the National Commission on State Workmen’s Compensation Laws, appointed by then-President Nixon, issued a report noting that state Workers’ Compensation laws were neither adequate nor equitable. This led to a decade when most states significantly improved their laws. 

Unfortunately, there has once more been a steady decline in benefits to injured workers, again under the guise of reform. One major argument is that many workers are faking their injuries or they just want to take time off from work. There was even a recent ad campaign in which a young girl was crying because her father was going to jail for faking an injury. Workers’ Compensation fraud does exist, but the high cost of insurance fraud is not as a result of workers committing fraud.

A colleague of mine compiled a list of the top 10 Workers’ Compensation fraud cases in 2014 in which he noted that the top 10 claims of fraud cost taxpayers well more than $75 million dollars with $450,000 of the total amount resulting from a worker committing insurance fraud. That leaves $74.8 million as a result of non-employee fraud, including overbilling and misclassification of workers. We are told that insurance costs are too high; yet, according to the National Council on Compensation Insurance (NCCI) in 2014, estimates show that private Workers’ Compensation carriers will have pulled in $39.3 billion in written premiums, the highest since they began keeping data in 1990. More premiums result in higher net profits. Despite this, many states have implemented changes in their Workers’ Compensation systems aimed at reducing costs to the employer. The end results, however, is that fewer benefits are given to the injured worker and more profits go to the insurance companies.

In New York, one of the reform measures increased the amount of money per week to injured workers but limited the amount of weeks they can receive these benefits with the idea that they will return to work once their benefits run out. Additionally, limitations have been placed on the amount and types of treatment that injured workers may receive. Again, this is with the notion that once treatment ends, injured workers miraculously are healed and will not need additional treatment. In reality, those injured who can’t return to work receive benefits from other sources from state and federal governments at the taxpayer’s expense.  This is what is known as cost shifting, as those really responsible to pay for benefits – the insurance companies who collect the premiums from the employers – have no further liability. The reformers of 100 years ago would be appalled at what is happening to injured workers and their families today. It is time that those who are generating profits at the expense of injured workers do what is fair and just – provide prompt medical care and wage replacement to injured workers for as long as they are unable to work.

To stay on top of important Workers’ Compensation happenings, please visit the Facebook page of Pasternack Tilker Ziegler Walsh Stanton & Romano, LLP and “Like Us.” That way you will receive the latest news on your daily feed.

 

 

Catherine M. Stanton is a senior partner in the law firm of Pasternack Tilker Ziegler Walsh Stanton & Romano, LLP. She focuses on the area of Workers’ Compensation, having helped thousands of injured workers navigate a highly complex system and obtain all the benefits to which they were entitled. Ms. Stanton has been honored as a New York Super Lawyer, is the past president of the New York Workers’ Compensation Bar Association, the immediate past president of the Workers’ Injury Law and Advocacy Group, and is an officer in several organizations dedicated to injured workers and their families. She can be reached at 800.692.3717.

 

Measuring Our Progress Since The Triangle Shirtwaist Factory Fire

Today’s post comes from guest author Catherine Stanton, from Pasternack Tilker Ziegler Walsh Stanton & Romano.

As an attorney who practices in the field of Workers’ Compensation, there are some events that are seminal in the history of workplace safety. One of those events was the Triangle Shirtwaist Factory fire, which occurred on March 25, 2011. The Triangle Shirtwaist Factory was one of the largest factories in New York and employed 500 mostly Italian and Jewish immigrant women between the ages of 13 and 23.

These women worked long hours for low wages in this cramped sweatshop at sewing machines to produce women’s blouses, known in those days as shirtwaists. In order to protect themselves from their claim of thefts by the workers, the factory owners would lock the doors to one of the stairways leading to the street. While the union movement in New York was very strong and some of the workers had joined the International Ladies’ Garment Workers’ Union, the factory itself was a non-union shop; many believed the owners would lock their doors to keep organizers out. Whatever the reason, locking those doors had devastating effects. 

On that fateful day in March, a fire broke out that was fueled by thousands of pounds of fabric. Many were able to escape to the roof and then to adjoining buildings. Unfortunately for those on the ninth floor, there was very little means of escape. The elevator proved inadequate as it was only able to accommodate 12 people at a time, and the operator was only able to make four trips before it broke down totally. Bodies of many of the workers were found at the bottom of locked stairwells or in the elevator shaft when they tried to escape. The fire escape was flimsy and when it became overloaded with panicked women, it broke and sent dozens to their death. Those trapped in the factory by the fire were left with the agonizing choice of jumping to their deaths or being burned alive. Many chose to jump. Bystanders recounted stories of seeing victims kiss each other or hold hands as they jumped two and three at a time; they described the horrific thud as bodies landed on the stone streets below. When the final tally was taken, 146 people had perished. The catastrophe sent shockwaves throughout New York City and the immigrant communities of Manhattan’s Lower East Side, where families struggled to recognize the charred remains of their loved ones in makeshift morgues. 

On March 24, 1911, the New York Court of Appeals declared the state’s compulsory Workers’ Compensation law unconstitutional. The next day, 146 people were dead from that Triangle Shirtwaist fire. With no Workers’ Compensation system in place, family members and dependents had to turn to the courts in an attempt to force Triangle to compensate the injured and the families of the deceased. A civil suit brought by 23 victims’ families against the owners netted a whopping $75 in damages per victim! New Yorkers were appalled and angry at the greed and negligence of the owners and managers. 

The Triangle Shirtwaist Factory Fire was a preventable tragedy caused by unsafe work conditions and was a catalyst for change. New York finally adopted a Workers’ Compensation law in 1913. This law was intended to protect workers from unsafe working conditions and afford them with wage replacement benefits and medical treatment in exchange for giving up their right to sue. Unfortunately, we see an erosion of many of these benefits under the guise of reform, while insurance companies have made record profits. This month, while we acknowledge this grim anniversary, we need to make sure that these women’s deaths were not in vain. Let us never forget the reason Workers’ Compensation laws were enacted, and let’s be sure the system is not watered down to the point that injured workers and their families go back to getting $75 for a preventable death.

  

Catherine M. Stanton is a senior partner in the law firm of Pasternack Tilker Ziegler Walsh Stanton & Romano, LLP. She focuses on the area of Workers’ Compensation, having helped thousands of injured workers navigate a highly complex system and obtain all the benefits to which they were entitled. Ms. Stanton has been honored as a New York Super Lawyer, is the past president of the New York Workers’ Compensation Bar Association, the immediate past president of the Workers’ Injury Law and Advocacy Group, and is an officer in several organizations dedicated to injured workers and their families. She can be reached at 800.692.3717. 

Careful What You Wish For: Denying Worker’s Compensation for Undocumented Workers

Today’s post comes from guest author Charlie Domer from The Domer Law Firm.

Immigration reform is a continual and vexing issue in Washington. While politicians, lobbyists, and service organizations grapple with potential resolutions, there is no disputing the existence of illegal immigrants working for employers in our country. And when there are employees working, work injuries happen.  This may be especially true with the undocumented population who may be more susceptible to significant injuries because many perform more dangerous or hazardous jobs that other may not accept. For further information, see Do Immigrants Work in Riskier Jobs? and the CDC’s report on work-related injury deaths among Hispanics.

…excluding illegal immigrants from worker’s compensation coverage could create a financial incentive for employers to keep hiring illegal immigrants.

When injured, are these undocumented workers eligible for worker’s compensation? Some harshly argue that these workers should receive no benefits, as they are not working legally in the country. However, one of the underlying pillars of worker’s compensation is that the expense of workplace injuries (covered by insurance) should be placed on the employers who profit from the workers’ labors. Additionally, excluding illegal immigrants from worker’s compensation coverage could create a financial incentive for employers to keep hiring illegal immigrants—a practice that is against federal law.

The worker’s compensation laws in our country do not have a definitive answer to this question—though the trend is toward coverage of undocumented workers. Many states do Continue reading