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February 2007

DC OSHA Injuries

WASHINGTON, Jan. 24 /PRNewswire-USNewswire/ -- The Occupational Safety and Health Administration today reminded employers that beginning Feb. 1, they must post a summary of the total number of job-related injuries and illnesses that occurred during 2006. Employers are only required to post OSHA Form 300A (summary), not the OSHA 300 log. The summary must be posted from Feb. 1 to April 30, 2007.

The form is to be displayed in a common area wherever notices to employees are usually posted. A copy of the summary must be made available to employees who move from worksite to worksite, such as construction employees and employees who do not report to any fixed establishment on a regular basis.

Copies of the OSHA Forms 300 and 300A are available on the OSHA Recordkeeping Web page in either Adobe PDF or Microsoft Excel Spreadsheet format.

Source: InsuranceNewsNet

Ohio Health-care Provider Pleads Guilty to Workers' Comp Fraud

The Ohio Bureau of Workers' Compensation (BWC) announced today that a Cleveland woman pleaded guilty to a felony count of workers' compensation fraud.

The woman pleaded guilty in Cuyahoga County Common Pleas Court to a fifth-degree felony. The court ordered her to repay investigation costs of $1,383.96, sentenced her to one year of probation and 40 hours of community work. The Cleveland woman had previously repaid $8,133.25.

Source: Insurance Journal

Oneonta, N.Y. Business Owner Pleads Gulity to Insurance Fraud

An Oneonta, N.Y. businessman has pled guilty to fourth-degree insurance fraud related to a fire that occurred at a tire sale company in Oneonta in August 2002, according to Acting Superintendent of Insurance Louis W. Pietroluongo and Otsego County District Attorney John Muehl. This announcement follows his arrest in April 2006.

The businessman’s plea of guilty to fourth-degree insurance fraud is in exchange for a sentence of five years of probation and restitution of $56,592.60. He is due to be sentenced on April 2, 2007.

The investigation was the second conducted under a new pilot program initiated by the insurance department in 2006 and the second to end successfully with a conviction. Under this program, the state lends an experienced insurance fraud prosecutor to local counties to act as an assistant district attorney. In this case, the fraud prosecutor was charged with responsibility for investigating and evaluating the merits of the fire and corresponding insurance claim.

Source: Insurance Journal

Commissioner Steve Poizner Issues Declaration of Insurance Emergency in Agricultural Freeze

Commissioner expedites insurance adjusters to State of California for agricultural devastation

SACRAMENTO - Anticipating that the magnitude of the agricultural freeze devastating California's crops and pending insurance claims will create a shortage of qualified insurance adjusters, California's new Insurance Commissioner Steve Poizner issued an Emergency Declaration today to help expedite insurance claims from the disruption of California's agricultural industry.

"Today, I am issuing a declaration which will dispatch additional insurance adjusters to the state of California to assist the agricultural community with insurance claims resulting from the disastrous freezing temperatures," said Commissioner Poizner. "During this state of emergency, I want to ensure that our farming communities avoid the red tape and get paid quickly so they can get back to the business of farming."

Today's proclamation from the Department of Insurance will allow out-of-state insurance adjusters to be dispatched to California's agricultural community to assist in California's state of emergency. The declaration comes as the Department of Insurance surveys California insurers and determines that outside adjusters will be in overwhelming demand for claims, just days after Governor Arnold Schwarzenegger proclaimed a state of emergency due to extreme low temperatures and freezing conditions which began January 11.

Preliminary data indicates that there may be more than one billion dollars of damage to California agricultural products, including approximately $700 million in damages to citrus crops, as well as extensive damage to avocado and strawberry crops.

Approximately 90% of crops in California are covered by crop insurance, and during a state of emergency the state's claims adjusters would be in high demand, causing severe delays.

Source: California Department of Insurance

Delaware Moves Swiftly to Enact Major Workers' Comp Reform

The Delaware Senate and House moved swiftly in the past week to pass a bill containing major reforms of the state's workers' compensation system and Gov. Ruth Ann Minner immediately signed the reforms into law.

Lawmakers hope the new law — SB 1 — will mean more than $30 million in rate relief for employers. Some estimates project savings could reach up to $43 million annually.

Lawmakers and Minner acted quickly in part to send a message to auto manufacturer DaimlerChrysler, which is considering whether to close a plant in the state that employs about 4,500 workers.

The new law promises to control workers' compensation costs by imposing fee schedules on physicians and some restrictions on lawyers' fees. It also promises to encourage certain best practices guidelines for treatments as well as standardize some of the health care forms used by employers, insurers and medical providers.

Under the new payment system, doctors could receive up to 90 percent of the most common charges for medical services while surgery charges by hospitals could be cut by 15 percent.

Attorneys for injured workers will have to have written fee agreements with their clients. The law attempts to limit when a lawyer can collect a percentage of a client's weekly benefit check.

In an effort to streamline payments to workers, the law authorizes an insurance carrier to make payments of indemnity benefits or health care benefits to a worker without affecting the insurer's right to later contest the employer's claim.

Insurers would be able to halt workers' compensation benefits to any persons jailed due to a criminal conviction.

The reform law also requires insurance carriers to notify the Department of Labor of cancellation of coverage on a business and enhances penalties for employers violating the state's mandatory insurance coverage provisions.

The legislation was developed by bill sponsors, Rep. William Oberle Jr., R-Newark, and Sen. Anthony DeLuca, D-Wilmington, who credited the cooperation of labor, medical and insurance representatives.

Minner tried but failed to enact workers' compensation legislation reforms last year.

The legislation mandates that the state hire a firm, Ingenix, to assist the Health Care Advisory Panel in developing the medical fee schedules and treatment guidelines.

In some of its specific provisions the new law:

• authorizes the Delaware Department of Insurance to order restitution against or for the benefit of self insured employers in connection with findings of insurance fraud.
• directs that a new workers' compensation rating plan be filed with the Insurance Commissioner within 90 days of the effective date of a medical payment system and practice guidelines, and at least annually thereafter.
• requires that carriers make rate filings 60 days after the adoption of each such rating plan.
• implements procedures for collection of data relevant to the workers' compensation system in the state, including data concerning injury reports, mandatory insurance requirements and health care treatments and costs.
• clarifies the obligations of independent contractors and subcontractors with respect to maintaining workers' compensation insurance.
• requires that petitions to the Industrial Accident Board for attorneys' fees be accompanied by affidavit, and that fees awarded to an employee's counsel offset any financial obligation the employee otherwise has to such counsel.
• establishes new procedures for attorneys' fees in workers' compensation matters. Among other things, it requires that attorneys representing employees have written fee arrangements and limits an attorney's ability to collect fees from an employee's periodic benefit payments to special circumstances that are subject to verification and approval by the Industrial Accident Board.
• authorizes employers or insurance carriers to make payments of indemnity benefits or health care benefits without prejudice to the right to later contest the employer's obligation to pay the expense in question. This section of the Act is intended to streamline payments to an injured worker.
• establishes a Health Care Advisory Panel charged to develop various health care cost containment and efficiency measures.
• provides for a health care payment system intended to control health care costs in connection with workers' compensation. The system will be developed by the Health Care Advisory Panel. The system is to provide clear schedules of maximum acceptable charges for professional services, hospital services, independent treatment centers, laboratory and pharmaceuticals. Such schedules after adoption will be adjusted annually by reference to the consumer price index. The health care payment system is required to be adopted within six months of the first meeting of the Health Care Advisory Panel.
• provides for the development of health care practice guidelines. Such guidelines will implement best practice standards for treatment standards in workers' compensation. Such guidelines will be developed by the Health Care Advisory Panel within one year of its first meeting.
• provides for the development of certification standards for health care providers treating employees in the workers' compensation system. Certification will require such providers to commit to certain standards in order to treat employees without pre-authorization. Such certification shall not be required for an employee's first treatment by a professional or for treatment by emergency medical personnel.
• provides for the adoption of forms for a consistent and uniform reporting system among employees, employers, insurance carriers and health care providers. Such forms are intended to better facilitate communication about an employee's condition with the objective of returning the employee to health and employment.
• allows the Industrial Accident Board to offset payment otherwise due to an employee where the Insurance Commissioner has made a finding of insurance fraud and ordered restitution.
• provides for workers' compensation matters before the Industrial Accident Board to be referred to mediation.
• provides a procedure to suspend workers' compensation benefits to persons who are incarcerated due to a criminal conviction.
• directs that the Industrial Accident Board, when reviewing a proposal to commute benefits, consider information relating to attorneys' fees and costs.
• requires that contractors and other parties doing substantial work within Delaware ensure that their employees are adequately insured for workers' compensation.
• strengthens mandatory insurance provisions by requiring insurance carriers to notify the Department of Labor of cancellation of coverage and requiring employers to either establish that the employer has gone out of business, or is no longer required to maintain workers' compensation insurance. It also enhances penalties for violating mandatory insurance coverage provisions.
• formalizes a workplace safety program already implemented by the Department of Insurance. The program allows premium credit to certain employers who meet safety standards that are verified by the Department of Insurance.
• authorizes the Office of Workers' Compensation to engage the firm of Ingenix, Inc. to provide services in connection with the development of health care cost containment measures adopted in the Act. Ingenix is a health care information technology and consulting firm with experience in addressing health care cost containment and affordability issues, both generally and in the specific area of workers' compensation.

Source: Insurance Journal

Monterey County Contractor Accused of Leaving Employees Without Workers' Comp

Case underscores abuses in the “underground economy”

MONTEREY - Insurance Commissioner Steve Poizner announced today a longtime Monterey County construction contractor faces charges after a California Department of Insurance (CDI) investigation showed he had been leaving his employees uninsured for on-the-job injuries. The contractor is scheduled to appear in Monterey County Court January 23, 2007 to enter a plea.

"This kind of fraud is particularly unconscionable," said Insurance Commissioner Steve Poizner. "What the contractor did was put his own greed above the welfare of the people he employed. If any one of these workers had been injured on the job- and that's not uncommon in the construction industry- that employee and his family could have faced financial ruin."

The contractor had been doing business in Monterey County for approximately 26 years. He allegedly hired and employed staff, for many years, without providing workers' compensation insurance. He has been charged by the Monterey County District Attorney's Office with four felony counts of committing perjury on a contractor's license application and several renewal applications for a partnership that never existed; four misdemeanor counts of failing to provide for workers' compensation; one misdemeanor count of fraudulent use of a contractor's license number; one misdemeanor count of contracting without a license; and one misdemeanor count of unlawful advertising.

According to investigators, on March 14, 1980, the contractor obtained a state contractor's license as a sole owner a drywall company. When his license lapsed ten years later, he continued to operate his business, employing uninsured workers until he encountered legal problems in 2000. Needing to show he had a contractor's license, he recruited a friend who had an active license and convinced him to form a dummy partnership in order to get a new expedited license from the Contractors State License Board (CSLB). With the aid of his friend, the contractor circumvented the license requirements and ran his dummy partnership for years, renewing the license every two years, and each time certifying under penalty of perjury that he and his friend were running the business together. In addition, he had filed with the CSLB a certification that he was not employing any persons as to be subject to the workers' compensation insurance requirements. That certification and his license were both found to be phony when he was recently caught on a job site in Pebble Beach with a handful of workers hanging drywall. Some of the workers reported they had been working for him for years.

The contractor was first arraigned on January 9, 2007, but did not enter a plea at that time. He will return to court on January 23, 2007 for further arraignment. The potential loss in this case is estimated at more than $64,219.

"When employers intentionally underinsure or under-report they undermine a system designed to protect everyone," said Commissioner Poizner. "Schemes to avoid payroll taxes, labor laws, and workers' compensation insurance premiums undercut legitimate businesses who cannot compete, workers are denied the benefits to which they are entitled, consumers are exposed to unexpected liabilities and shoulder unfair tax burdens, and the State of California is significantly harmed and limited in providing necessary services."

There are an estimated 800,000 employers in California, and approximately 30% do not have workers' compensation insurance.

Source: California Department of Insurance

Nashua, N.H., Contractor Faces $64,700 in Fines from U.S. Labor Department's
OSHA for Cave-In Hazards at North Conway Worksite

CONCORD, N.H. – A utility construction company faces $64,700 in proposed fines from the U.S. Department of Labor's Occupational Safety and Health Administration (OSHA) for alleged cave-in hazards at a North Conway worksite. The contractor was cited for four alleged willful, repeat and serious violations of safety standards following a September inspection at a water main installation site on the White Mountain Highway.

OSHA's inspection found employees working in a nine-foot-deep trench that lacked protection against a collapse of its sidewalls. This resulted in one willful citation, carrying $56,000 in proposed fines. 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 and regulations.

"This employer knows that all excavations five feet or deeper must be protected against collapse, yet failed to do so despite having been cited for the same hazard one month before this latest inspection," said Rosemarie Ohar, OSHA's New Hampshire area director. "Failure to provide cave-in protection exposed employees to imminent and potentially fatal crushing and suffocation hazards."

One repeat citation, with a proposed $6,000 fine, was issued for locating the trench's access ladder in an unprotected area of the trench. OSHA cited the company for a similar hazard in August 2006. The company also received two serious citations, with $2,700 in proposed fines, for employees in the trench working beneath undermined asphalt and an unsupported concrete slab and for not using a trench box according to its manufacturer's specifications.

A serious citation is issued when death or serious physical harm are likely to result from a hazard about which the employer knew or should have known. A repeat citation is issued when an employer has previously been cited for a similar hazard and that citation has become final.

Detailed information on excavation safety, including a trenching "Quick Card," is available for employers and employees on OSHA's Web site at: www.osha.gov/SLTC/trenchingexcavation/index.html.

The company has 15 business days from receipt of the citations 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. The investigation was conducted by OSHA's Concord area office, phone (603) 225-1629.

Under the Occupational Safety and Health Act of 1970, employers are responsible for providing a safe and healthful workplace for their employees. OSHA's role is to assure the safety and health of America's working men and women by setting and enforcing standards; providing training, outreach and education; establishing partnerships; and encouraging continual process improvement in workplace safety and health. For more information, visit www.osha.gov.

Source: OSHA

"The time is always right to do what is right"
- Martin Luther King Jr.