Wednesday, August 27, 2008

Problem in Ohio Industrial Commission Add to Workers’ Compensation Backlog

A "climate of fear" among employees within the Ohio Bureau of Workers’ Compensation and the Ohio Industrial Commission may be affecting their ability to process workers’ compensation and make decisions on whether injured workers are entitled to benefits, contributing to a backlog of cases.

A recent audit, as well as a series of investigative articles by the Columbus Dispatch revealed that the backlog of workers’ compensation cases awaiting decision grew as employees of the Bureau of Workers’ Compensation grew increasingly unhappy and fearful about their own working conditions.

In a story published in February, The Dispatch found that a backlog of injured-worker cases grew last year as employees filed dozens of union grievances on workplace issues. Many of the 111 union grievances filed in 2007 alleged retaliation and unequal application of policies such as timekeeping, pregnancy leave and outside employment.

An audit of the agency by the Ohio Department of Administrative Services, revealed some shocking information:

  • More than 90 percent of employees of the Ohio Industrial Commission complained about retaliation and other management issues.
    Half of those interviewed said they had experienced some type of discrimination.
  • Two of the Industrial Commission employees were "visibly shaking and trembling" when interviewed, the report said. Another cried. Seven were "very hesitant to speak."
  • The report was strongly critical of the management of the 500-employee agency, which hears appeals of Bureau of Workers' Compensation decisions and all cases involving compensation for permanent disabilities.
  • The report dealt specifically with the Industrial Commission's handling of Equal Employment Opportunity complaints, but it also noted a climate of fear and retaliation. Employees were "frantic" as soon as the Department of Administrative Services launched its inquiry, fearing retaliation if they participated in the process, the report noted.
  • The Ohio inspector general's office, which investigates reports of wrongdoing and other problems in state government, also is probing the commission. That report is expected today.

The commission's chairman, Gary DiCeglio, a former union official whom Gov. Ted Strickland appointed in July, said he can't identify the source of alleged retaliation.

  • "There's never been one person who's said, 'It's happened to me,' " DiCeglio said. "I've asked where, but I've never come up with a showing in this instance. Please tell me who's doing the retaliation and where."
  • DiCeglio said the commission has nearly worked through the backlog, while labor-management issues have improved. DiCeglio and other Industrial Commission officials met in mid-February with leaders of the Ohio Civil Service Employees Association to try to iron out the disputes.

Sunday, August 17, 2008

Montana Cutting Workers’ Comp Rates for Some Businesses

Working safer is paying off in Montana.

For the second year in a row, the Montana State Fund is cutting workers' compensation insurance rates. The average savings will be 3 percent, but some businesses, including day care centers, grain elevators and oil and gas lease operators, will see their rates drop by a third. However, other businesses, including manufacturers of fireproofing materials and taxidermists, face rate increases of 25 percent to 37 percent.

Laurence Hubbard, the State Fund president, said the cut shows Montana's businesses have been safer and are working to return their injured workers to work quickly. He also said the State Fund has worked on safety programs and managing injured-worker claims to help cut costs.

"This is great news for our businesses," said Joe Dwyer, chairman of the State Fund board of directors. "In comparison with other states, Montana has been ranked as having the fifth-highest workers' compensation rates in the nation due to the high cost of injury claims. This reduction is a positive step toward changing that for the better."

The new rates go into effect July 1. Workers’ compensation rates are calculated based on a company’s safety performance and how dangerous the work is.

Sunday, August 10, 2008

The Hidden Cost of Reporting a Workplace Injury

An attorney-blogger at Injury Board talks about what can happen when workplace safety programs pit workers against their coworkers.

The blogger is not against safety and training programs that keep workers safe and prevent injuries. But he does point out that sometimes workers may face a harrowing choice – inform a superviser of an injury and lose a bonus for consecutive injury-free days or keep quiet. What’s more, injured workers may face peer pressure from their coworkers to keep quiet if there’s a chance that bonuses could be affected.

It’s interesting food for thought:

Rewarding workers for exercising proper safety techniques, attending safety meetings or offering recommendations for improving safety practices all sounds good, right? But, here’s where worker safety incentive programs can become a problem. In these programs, the employer rewards its employees for the company having gone so many days, weeks or months without a workplace injury, or without any lost time days. The rewards may take the form of monetary compensation, awards or recognition for having reached a predetermined goal as established by the employer.

What’s the downside you ask? While workers may be encouraged to report all injuries, the reporting of an injury, regardless of how minor can cause a break in the run of consecutive injury-free days from work and, perhaps more importantly for some, no reward ($$) from the employer. By following the rules and reporting all injuries, a worker risks incurring the anger of co-workers who have been informed by their employer that they will not receive a prize.

Here’s the dilemma: Report the injury and lose the reward, or don’t report the injury and risk potentially serious consequences by way of a reprimand, suspension or something worse for having failed to follow company policy. The situation becomes much more problematic down the road, if what seemed like a minor back strain that the worker chose not to report out of fear of turning the co-workers against him is later diagnosed by a doctor as a herniated disc for which surgery is needed. Now the worker has a huge problem because the workers’ compensation claim resulting from the workplace accident will likely be denied by the employer and workers’ compensation insurance company because there is no record of the worker having reported the accident to the plant nurse, supervisor, or anyone else in a managerial capacity.

What now is the worker to do if he has been taken off work by his doctor for an accident and condition that the employer has denied is work-related but prevents him from working and generating income, and which requires an operation? The problem is greatly magnified if the injured worker lacks health insurance, lacks short or long-term disability benefits, or lacks a second household income with which to pay for medical care, groceries and rent.

Worker safety programs are intended to bring workers together by providing them with a reward for having an injury free workplace. Programs that implicitly encourage the under reporting of injuries are wrong. It is simply unfair to place an employee in the position of having to forego a bonus because his friend and co-worker has suffered an injury on the job. Instead of uniting workers, the safety incentive programs may well have the unintended consequence of dividing them.

Friday, August 1, 2008

California Mans Faces 54 Years in Prison for Workers’ Comp Insurance Scam

An insurance agent in California who sold businesses scam workers’ compensation insurance has been charged with 153 felonies, including forgery, grand theft, identity theft and insurance fraud.

For four years, Anthony David Medina operated Prompt Insurance Agency in Newport Beach. Calif. During that time, he collected more than $2.5 million from 18 business owners, including restaurants, plumbing and painting businesses, and other service- oriented businesses, according to the California Department of Insurance. These companies believed they were paying Anthony David Medina to secure workers’ compensation and general liability insurance; instead, he is accused of pocketing the money.

Medina is accused of failing to take out insurance policies for many of the businesses and charging the victims more than the stated premiums. In some instances, he is accused of forging documents to finance insurance policy premiums instead of paying the full amount up front to the insurance company, despite the fact that the victims had paid him the total cost of the policy premium.

Anthony David Medina was charged with 153 felony counts including 86 counts of forgery, 33 counts of transacting as an insurance company without a certificate of authority, 19 counts of grand theft, five counts of filing false tax returns, four counts of willfully failing to file a tax return, four counts of identity theft, two counts of insurance fraud, and sentencing enhancement allegations for excessive taking more than $50,000 and $150,000.

Medina was arrested at a business in Oxnard, Calif., and is being held on $2.9 million bail. To post bond he must prove that the money is from a legitimate source. Medina faces a maximum sentence of 54 years and four months in state prison if convicted on all counts.

Medina's wife, Vanessa Chaverri, was arrested at a Ladera Ranch, Calif., home, and is charged with five felony counts of filing a false return. She is being held on $436,000 and must prove the money is from a legitimate source before posting bail. Chaverri faces a maximum sentence of six years in state prison if convicted.

Because of Medina’s alleged fraudulent actions, some injured workers were unable to collect workers’ compensation benefits. And several businesses experienced other losses that should have been covered by insurance but were not because no policies were in effect.

In some cases, employees who had been injured at work did not receive the workers' compensation benefits they were due because their employer did not have the workers compensation insurance they had paid Medina to secure. Many of the business owners had to pay for employee workers' compensation care that should have been covered by insurance.