State: Georgia

Area of Interest: United Healthcare HMO Fined $150,000

Atlanta - Georgia Insurance Commissioner John W. Oxendine today fined United HealthCare of Georgia, Inc., for violating Georgia’s prompt pay law, the third health maintenance organization (HMO) to be fined this year for delaying claims payments. Commissioner Oxendine ordered the HMO to pay a penalty of $150,000. The fine is the latest in a series of fines against health maintenance organizations and other healthcare plans resulting from ongoing reviews by Commissioner Oxendine’s office of claims data that the plans are required to submit quarterly.

"I will continue to monitor our state’s HMOs and fine them if necessary," Commissioner Oxendine said. "We’ve seen some improvement in claims handling since I started the initial round of examinations in 1999. I expect that improvement to continue."

Georgia law requires that managed care plans pay claims within 15 working days, or notify the provider or policyholder why a claim can’t be paid.

In August 1999, Oxendine issued a directive to all healthcare plans licensed in Georgia that his office would begin examining claims data every quarter, beginning with the quarter ending September 30, 1999. Since then no HMO reviewed to date has been in 100 percent compliance with the law. HMOs and other healthcare plans have been repeatedly warned by Commissioner Oxendine that nothing less than strict compliance with the law is expected.

Source: State of Georgia

State: Massachusetts

Area of Interest: Fatal Explosion and Fire Lead To Over $71,000 In Proposed Fines For Worcester Company

SPRINGFIELD, Mass. - The death of a welder in a Worcester, Mass., explosion and fire has led to $71,250 in proposed fines against his employer for failing to protect workers against the hazards of flammable vapors during cutting and welding operations.

TS Truck Service, Inc., a commercial fuel delivery firm located at 22 Eskow Road, has been cited by the U.S. Labor Department's Occupational Safety and Health Administration for alleged willful and serious violations of the Occupational Safety and Health Act following the Dec. 17 fatality. On that day, an employee who was welding atop a delivery truck's fuel tank died after flammable vapors inside the tank ignited, causing an explosion and fire that engulfed him.

OSHA's inspection found that the company allowed the welding to proceed without first ensuring that the tank and its piping had been cleaned thoroughly enough to eliminate any flammable materials or substances which could produce flammable vapors, according to Ronald E. Morin, OSHA area director for central Massachusetts.

"This is a critical safety precaution that was not followed even though it was required and the employer was well aware of it," said Morin. "As a result, we are citing this item as willful, the most severe category of OSHA citation, and proposing a $49,000 fine."

An additional $22,250 in fines is proposed for seven alleged serious violations, including: failure to have an authorized person inspect the work area for fire hazards before welding; failing to properly cover or locate flammable and combustible materials at least 35 feet from welding operations; not having suitable fire extinguishing equipment present and immediately available for use during welding; failure to suitably train workers; electrical outlets, lighting and fans that were not approved for a hazardous location; no fall protection for an employee working atop a 10-foot, 6-inch high truck tank; and inadequate training for forklift operators.

OSHA defines a willful violation as one committed with an intentional disregard of, or plain indifference to, the requirements of the Occupational Safety and Health Act. A serious violation is one where there is a substantial probability that death or serious harm could result and the employer knew, or should have known, of the hazard.

TS Truck Service, Inc. has 15 business days from receipt of its citations and proposed penalties to either elect to comply with them, to request and participate in an informal conference with the OSHA area director, or to contest them before the independent Occupational Safety and Health Review Commission.

Source: Occupational Safety and Health Administration

State: New York

Area of Interest: 12 Reportedly Stolen Vehicles Worth $500,000 Recovered in Car Insurance Fraud Investigation

Owners Arrested for Allegedly Falsely Reporting Their Cars Stolen for Insurance Settlements

New York State Insurance Superintendent Gregory V. Serio joined by Queens District Attorney Richard A. Brown and Police Commissioner Raymond W. Kelly announced today that 12 car owners have been arrested in a $500,000 automobile insurance fraud scheme. Among those arrested are a doctor, a physician’s assistant and a licensed stockbroker.

Superintendent Serio said, "Rip-offs like these victimize New York's drivers who end up paying higher prices and increased auto insurance rates to offset the losses that result from these fraudulent claims. Today's arrests of a doctor, physician’s assistant and stock broker, among others, proves that insurance criminals come in all shapes and sizes. The good news is that our on-going collaborative efforts with the Queens District Attorney's office and the NYPD have been successful in taking these crooks off the street. Working together we will continue to crack down on these cheats who attempt to feast on auto insurance fraud."

According to the charges, all of the owners falsely reported that their vehicles had, on a certain date, been stolen, when in fact those vehicles were already in police custody pursuant to this undercover police operation. The vehicle owners then filed insurance claims, allegedly falsely reporting that their vehicles had been stolen and received settlements of up to $33,599 each. In each case, the owners sold their allegedly stolen cars to an unapprehended third party.

District Attorney Brown said, "Hopefully people are beginning to get the message that auto insurance fraud is a serious matter. Insurance fraud means higher insurance rates for all of us. Investigations like this one help drive down auto insurance fraud and we are very much committed to continuing them."

Police Commissioner Kelly said, "These individuals thought they could scam insurance companies out of hundreds of thousands of dollars. But like so many frauds, this one has been rooted up and exposed, and its perpetrators will now face the consequences. As always, our undercover officers did a superb job catching these criminals and bringing them to justice."

The arrests are the result of an investigation known as Operation Fraud Fools, the latest in a series of undercover operations in Queens County targeting auto insurance fraud that began in 1991. The operation was conducted by the New York State Insurance Department Frauds Bureau, the NYPD’s Organized Crime Control Bureau Auto Crime Division and the Queens District Attorney’s Organized Crime and Rackets Bureau.

The defendants have been arrested for various charges including Grand Larceny in the Third Degree, Insurance Fraud in the Third Degree and Falsely Reporting an Incident in the Third Degree and Conspiracy. Most face up to seven years in prison, if convicted.

Source: State of New York

Area of Interest: Ohio One of Six States to Sign Innovative Cooperative Agreement for Market Conduct Exams

Ohio Department of Insurance Director Lee Covington has signed a cooperative agreement that will increase the efficiency and effectiveness of market conduct examinations of insurance companies doing business in Ohio. Market conduct exams determine the extent to which insurers comply with state law regarding the marketing of insurance in the state.

Ohio last week joined Nebraska, Kansas, Iowa, South Dakota and North Dakota in signing the "Cooperation Agreement for Comprehensive Market Conduct Examinations," which is intended to increase the effectiveness of state market conduct programs and reduce redundancy in staff and resources through enhanced cooperation between the participating states.

By signing the Cooperation Agreement, Ohio agrees to perform comprehensive market conduct examinations for insurers headquartered in Ohio and defers to the cooperating states regarding examinations of insurers in their respective states.

Each time Ohio conducts an exam of a domestic insurer, they will invite other participants in the Cooperation Agreement to take part in the exam and/or share the data collected during the exam with those participating states. When other states conduct an exam, Ohio will be invited to participate in the same way.

"We’re excited about joining this agreement. This is all about effective, efficient, and value-added insurance regulation. This agreement enables the Department to better utilize its existing resources and at the same time provide additional protections for Ohio consumers," Covington said. "Market conduct reform is a top priority for all insurance regulators, and this agreement is a key component of our plan."

Governor Bob Taft signed the Information Sharing Act (SB 138 -- Sen. Nein) in March, a new law that enables the Department of Insurance to exchange information with other state, federal, and international regulatory agencies. The legislation, which becomes effective on June 18, allows Director Covington and the Department to enter into information sharing agreements such as the "Cooperation Agreement for Comprehensive Market Conduct Examinations."

"As a result of this legislation, Ohio now has the ability to give and receive access to information that leads to a more efficient and effective market conduct system nationally," Covington said.

Ohio recently spearheaded another interstate cooperative project that capitalizes on the value of the information sharing abilities of state regulators. The Ohio, Oregon, Illinois and Nebraska insurance departments combined efforts, staff and resources on a recent examination of one large insurer. The four states first identified priority issues and established protocols for multi-state examinations, assigning each examiner specific functional areas or test standards. The examiners reviewed files on behalf of all four states, departing from a traditional examination where each examiner reviews files applicable only to their state. As a result of these protocols, the examiners were able to complete their onsite work in just three weeks.

The exam was completed in an expedient and comprehensive manner and has led to the development of new cooperative exam techniques and best practices shared with other states.

Source: State of Ohio

State: Oregon

Area of Interest: Recordkeeping: OSHA record-keeping and workers' compensation claim confidentiality

The following is WCD's policy position regarding release of 801 information by a temporary or leasing company to its client:

Background: Oregon OSHA received a question from a temporary employment agency. As the employer, the temporary agency receives the claim from its employee on Form 801. However, the client is responsible for keeping the 300 log and associated Form 301 or equivalent.

Question: Can the temporary agency forward a copy of the 801 to the client so the client can use it for record-keeping purposes? If so, can the temporary agency forward both the worker's and employer's pages?

Answer: The temporary agency (or leasing company) may forward the employer-page of the 801 but not the worker's page.

Reason:
(1) The worker's page of the 801 is a "claim" form and may not be released to anyone except the worker, worker's attorney, the insurer, or DCBS (unless the worker signs a release). OAR 436-060-0017 likely applies to employers, though it specifies what insurers may release. (2)The worker's page is unnecessary for record-keeping. (3) The employer's page of the 801 includes a statement: "This form satisfies OSHA Form 301 record-keeping requirements." It is not a "claim" form and may be used for record-keeping even in the absence of a workers' compensation claim. (4) OSHA rules (OAR 437-001-0700(14)) state "You must use OSHA 300, 300-A, and DCBS Form 801 or equivalent forms, for recordable injuries and illnesses. The OSHA 300 form is the Log of Work-Related Injuries and Illnesses, the 300-A is the Summary of Work-Related Injuries and Illnesses, and the DCBS Form 801 or equivalent is the Worker's and Employer's Report of Occupational Injury or Disease."

Source: State of Oregon

State: Texas

Area of Interest: Consumer Bills of Rights Updated

Commissioner Jose Montemayor today approved updated consumer "bills of rights" that automobile and residential property insurance companies must provide to each of their policyholders.

"Knowledge is power, and I’m very pleased that Texans now will have the very latest information on their rights as auto and home insurance policyholders," Montemayor said. "I hope that every insurance consumer will take the time to read these bills of rights and refer to them when questions arise about such things as cancellations, claims and discounts."

As provided by the Texas Insurance Code, the Office of Public Insurance Counsel (OPIC) submitted proposed changes to the bills of rights. Texas Department of Insurance (TDI) staff subsequently worked with OPIC on the changes and recommended them to Montemayor. In general, the revisions reflect legislation and TDI actions since the bills of rights were originally adopted in 1993.

There is a separate Consumer Bill of Rights for Personal Automobile Insurance and a Consumer Bill of Rights for Homeowners, Dwelling and Renters Insurance. Insurance companies are required by law to provide the updated bills of rights to all new customers when they receive their policies. Insurers also must provide the updated bills of rights to all existing customers with their next policy renewals. Changes included in the updated bills of rights include but are not limited to:

BOTH AUTO AND RESIDENTIAL PROPERTY

• Addition of language about the residential property and private passenger automobile Market Assistance Programs operated by TDI to help consumers in underserved areas.
• Expansion of the sections concerning the consumer’s right to be told, upon request, the reasons for denial, cancellation or non-renewal of an auto or residential property policy.
• The addition of e-mail addresses to TDI consumer contact information. * AUTO INSURANCE
• Updated language on auto insurance discounts, including the increase of the two-car discount to 20 percent and the addition of discounts for installing anti-theft devices on one’s car and for taking approved alcohol and drug awareness classes.
• New language reflecting rules prohibiting an insurance company from refusing to renew an auto policy based solely on the age of any person covered by the policy.
• A new notation that loans from premium finance companies may be more costly than the installment plans offered directly by insurance companies. RESIDENTIAL PROPERTY
• Addition of language summarizing TDI rules against refusal to insure a property based solely on the age or value of a house.
• A summary of property insurance discounts for home security, electronic burglar alarms, sprinkler systems and impact-resistant roofs.
• New language summarizing the Voluntary Inspection Program for residential property insurance purposes. A VIP inspection certificate creates a presumption that a home is insurable.

Source: State of Texas

State: Ohio

Area of Interest: OSHA Establishes Whistleblower Complaint Procedures for Airline Employees

OSHA issued an interim final rule last month to protect airline employees against retaliation by air carriers, their contractors, or subsidiaries for providing information to authorities on air carrier safety violations. The rule establishes procedures for handling airline employee complaints under the whistleblower protection provisions of the Wendell H. Ford Aviation Investment and Reform Act for the 21st Century (AIR21). The rule explains requirements for filing complaints and provides investigation and due process procedures. OSHA, under Section 11(c) of the Occupational Safety and Health Act, enforces whistleblower complaints related to occupational safety and health activity. In addition to the OSH Act and AIR21, OSHA is responsible for whistleblower cases governed by 10 other federal statutes.

Source: Occupational Safety and Health Administration