Месечни архиви: October 2015

Another Report Shows California Workers’ Comp Reforms Working

Another Report Shows California Workers’ Comp Reforms Working

A new study on worker’s compensation across 17 states shows that reforms sometimes work – and such is the case of sweeping reforms made in California, the report shows.

The Workers Compensation Research Institute, an independent, not-for-profit research organization based in Cambridge, Mass, issued a set of studies this week that examine the factors behind trends of medical payments per claim in state workers’ comp systems and the impact of legislative and regulatory changes.

The WCRI studies, CompScope Medical Benchmarks, 16th Edition, examine trends in payments, prices, and utilization of medical care for injured workers.

The studies cover the period from 2008 through 2013, with claims experience through March 2014. The states studied are: Arkansas; California; Florida; Georgia; Illinois; Indiana; Iowa; Louisiana; Massachusetts; Michigan; Minnesota; New Jersey; North Carolina; Pennsylvania; Texas; Virginia; and Wisconsin.

workers_compFindings in the report seem to indicate that reforms passed with SB 863 in California in 2012 are working.

Among the many SB 863 reforms were a mandated adoption of a resource-based relative value scale for professional fees, a reduction in ambulatory surgery center fees from 120 percent to 80 percent of Medicare hospital outpatient rates, as well as independent medical review and independent bill review processes.

SB 863 also established a $150 lien filing fee and a $100 activation fee for liens already filed.

The Workers’ Compensation Insurance Rating Bureau issued a report in August that shows the lien fee was among elements of SB 863 that have helped to reduce costs within the system.

The fees were intended to reduce the hundreds of thousands of liens filled each year costing the system hundreds-of-millions of dollars, according to the WCIRB.

The Department of Industrial Relations and its Division of Workers’ Compensation released a report in July that detailed increased payments to injured workers and significant cost-saving benefits for employers.

That report also showed lien filings have decreased by roughly 60 percent since the passage of SB 863.

In May the California Department of Insurance adopted advisory pure premium rates for July 1, which on average are five percent less than the industry average for filed pure premium rates as of Jan. 1, and 10.2 percent less than the average of the approved Jan. 1 rates.

However, not all reports have pointed to falling costs across the board. The WCIRB report in July showed that workers’ comp premiums in California continue to grow at double-digit rates.

The WCRI study out this week on California showed medical payments per claim fell 5 percent in 2013, which the report’s authors say was likely a reflection of the early impact of the SB 863 reforms. That decrease included reduced reimbursement rates for ambulatory surgery centers and elimination of separate reimbursement for implantables.

A key driver of the decrease in the average medical payment per claim in 2013 were ambulatory surgery center facility payments per claim, which fell nearly 24 percent that year, the study states.

Following the transition to the resource-based relative value scale based fee schedule, prices paid for primary care rose in California while the prices paid for specialty care decreased in 2014, the study shows.

“SB 863 is expected to affect both the prices and utilization of medical care for most types of providers,” the report states. “Based on data with six to 15 months of experience post-reform, this report examines some early impact of several SB 863 provisions on a series of performance measures in California, including the average medical payment per claim, ASC facility payments per claim, prices paid for various types of professional services, and billing patterns of office visits and report codes in the state.”

Alex Swedlow, president and chief executive officer of the California Workers’ Compensation Institute, said this study and previous studies have continued to show that the 2012 reforms have been effective so far.

He said it’s too early to know what the impact will be on permanent disability, but the evidence from the reduction in liens, decreasing medical costs, the reduction in ambulatory surgery center costs and back surgeries all point to success so far for the SB 863 reforms.

“Workers’ compensation reform never ends,” Swedlow said. “There’s always modifications and adjustments going on. But right now I think we can feel optimistic that many areas of reform that are targets in SB 863 appear to be working.”


Ninth Circuit Court Upholds California’s Workers’ Comp Liens
Report on California Workers’ Comp Reforms Touts Successes
Liens Stress California Workers’ Comp System
California WCIRB Report Shows Medical Bill Transactions Fell in 2014
Surgical Funding Firm Accused of Inflating Claims


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California Bill Requiring Earthquake Reports on Water Infrastructure Signed

California Bill Requiring Earthquake Reports on Water Infrastructure Signed

California Gov. Jerry Brown on Friday signed into law a plan to require regional water-management officials to report the vulnerability of their water systems to an earthquake.

Senate Bill 664, authored by Sen. Bob Hertzberg, D-Van Nuys, addresses Urban Water Management Plans, a collaborative overseen by the state Department of Water Resources to identify and use regional water-management solutions to increase regional self-reliance and manage water.

SB 664 will direct all UWMPs to include an assessment or evaluation of the seismic vulnerability of the water infrastructure.

earthquakeThe introduction of the bill followed a Los Angeles Department of Water and Power report that identified $15 billion in potential need for seismic upgrades to water infrastructure. Last year voters approved a water bond that provides $810 million to water-management projects. Seismic-safety upgrades may be eligible for funding from recent bond measures.

“Gov. Brown understands that with a fourth-straight year of drought driving home the precarious nature of California’s water supplies, we cannot ignore forecasts showing a greater than 99-percent chance of a 6.7 earthquake within the next 30 years,” Hertzberg said in a statement. “Much of California’s infrastructure, including key water-delivery systems, remains seismically unsafe and extremely vulnerable.”

Hertzberg’s district includes the San Fernando Valley, where the 6.7 magnitude Northridge earthquake left 57 dead, more than 9,000 injured and caused more than $40 billion in damages in 1991.

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Delaware’s Pumpkin Flinging Event Canceled Due to Insurance Issues

Delaware’s Pumpkin Flinging Event Canceled Due to Insurance Issues

For the second year in a row, Delaware’s annual pumpkin flinging contest has been squashed.

Organizers of the World Championship Punkin Chunkin said Thursday that this year’s event, scheduled for next month at Dover International Speedway in Dover, Delaware, has been canceled because of problems finding insurance coverage.

The Punkin Chunkin, in which contestants launch pumpkins with a variety of homemade contraptions, began in Sussex County in 1986. Organizers started looking for another site last year after a Sussex County farmer said he would no longer make his property available. That decision came after a lawsuit was filed by a Punkin Chunkin volunteer who was seriously injured in an ATV accident while working the 2011 event.

Organizers say fans who purchased tickets will have their credit card payments refunded.

“Unfortunately, despite the best efforts of our Board throughout an exhaustive, nation-wide search, we have been unable to locate a willing insurer to adequately protect our host venue, our organization, our fans and our spectators,” the Punkin Chunkin organizers said.


Copyright 2015 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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BHSI Launches Professional Liability Network Security Privacy Policies

BHSI Launches Professional Liability Network Security Privacy Policies

Berkshire Hathaway Specialty Insurance (BHSI) has launched two new policies providing cyber liability and breach response coverage with risk management resources, the Professional First Network Security & Privacy Policy and the Professional First Professional Liability and Network Security & Privacy Policy. The latter also includes customizable errors and omissions (E&O) liability coverage.

The Professional First Professional Liability and Network Security & Privacy Policy provides E&O coverage for technology and specified miscellaneous services. Both policies include multi-faceted network security and privacy liability insurance and risk management resources, which can be tailored for professional services firms of all types, from technology enterprises, to financial institutions, to law firms.

Features of both policies include:

Coverage for third party exposures resulting from data security and privacy breaches, including regulatory investigations, fines and penalties.
Breach expense and extortion threat coverage, addressing the wide range of direct expenses an Insured incurs to effectively respond to a breach or extortion threat.
Media liability coverage, which responds to traditional media exposures (e.g. through a company’s website) arising from electronic content.
Business interruption coverage to pay lost income and related expenses incurred as a result of the Insured’s business’ partial or full interruption due to a network security failure.
Online access to eRiskHub, which provides state-of-the-market tools and resources to help policyholders understand cyber exposures, establish a breach response plan, and prepare to mitigate the impact of a breach on their organization. eRiskHub is provided via NetDiligence, a leading cyber security and e-risk assessment firm.

BHSI’s new Professional Liability and Network Security & Privacy Liability Polices are the latest additions to BHSI’s Professional First suite of professional liability products for financial and commercial firms.

Berkshire Hathaway Specialty Insurance provides commercial property, casualty, healthcare professional liability, executive and professional lines, surety, travel, programs, and homeowners insurance. It underwrites on the paper of Berkshire Hathaway’s National Indemnity group of insurance companies.

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OSHA Louisiana Bag Maker Exposed Workers to Amputation Hazards

OSHA Louisiana Bag Maker Exposed Workers to Amputation Hazards

Federal safety officials have cited Bancroft Bags Inc. in West Monroe, La., for failing to protect workers from amputation hazards. The company has been fined $84,000.

Bancroft was cited for 16 serious violations on Oct. 7, 2015. The citations allege the company failed to guard machinery and implement appropriate shut down procedures.

OSHA began an inspection in  April 2015 after receiving notification from the employer that a printing press operator, who was trying to remove a gear from its shaft, had his hand pulled into the gears and his index finger amputated.

“The cost of implementing safety procedures is so low, and the cost of ignoring them is so high. If Bancroft had implemented procedures to keep the press from starting up, this man would still have all 10 fingers. Instead he’s suffered an injury that will affect him the rest of his life. This was a preventable injury and it’s incumbent upon the employer to find and fix hazards that pose a threat to the safety and health of its workers,” said Dorinda Folse, OSHA’s area director in Baton Rouge.

Bancroft Bags, manufactures bags for pet food, fertilizers and chemical product companies, and employs about 400 workers at its West Monroe packaging plant.

The company has 15 business days from receipt of its citations to comply, request an informal conference with OSHA’s area director, or contest the citations and penalties before the independent Occupational Safety and Health Review Commission.

Source: OSHA

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IICF Week of Giving About Helping Hope Future

IICF Week of Giving About Helping Hope Future

Giving can go well beyond being a mere act of philanthropy.

That’s the thinking behind the upcoming Insurance Industry Charitable Foundation event from Oct. 10 through Oct. 17.

The IICF Week of Giving, formerly known as Volunteer Week, is the group’s most visible program that allows insurance industry professionals to take a leadership role in community involvement.

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The program provides an opportunity for the insurance industry to come together for a united week, giving time, talent and resources to benefit local community nonprofits, its organizers say.

Connie Taylor, Zone Officer at The Navigators Group of Navigators, described the Week of Giving as an eight-day, industry-wide opportunity for individual volunteers to participate in three or more hours of volunteer service and nonprofit actives.

Taylor is leading IICF’s Western Division Week of Giving efforts.

“It’s foodbanks, it’s delivering food to the elderly, it’s reading in local libraries or shelters, you can do Habitat for Humanity projects,” Taylor said. “It’s a broad range of people’s passions.”

Taylor said a theme that can be found in the popular book “Peaceful Warrior,” can also be found in the ideology behind the Week of Giving.

“There’s no higher purpose than service to others,” Taylor said, adding, “there is no higher commitment than giving your time and this is an opportunity for us to do that.”

Week of Giving was founded in the Western Division in 1998 by the founders of IICF, and this year participation is expected to exceed 6,000 volunteers and more than 200 events in roughly 90 cities across the US.

The volunteer service areas are numerous, and include education, food, homeless and youth programs, as well as arts and literature, senior services, disaster preparedness, Taylor said.

“What we want to do is make a significant difference in a couple of key areas,” she added.

IICF is also the group behind the popular charitable venture Every Day is a Reading and Writing Day.

With the goal of encouraging early childhood reading, IICF and Sesame Workshop, the nonprofit organization behind Sesame Street, promote Every Day is a Reading and Writing Day at events nationwide and reach out to families and volunteers through local and national programming.

The initiative from IICF and Sesame Street is in response to the wide gap in literacy rates that prevails between children of high and low-income families, according to the groups.

To help promote the event the groups typically pick community centers in poor urban areas and bring in Sesame Street characters to help cheer of volunteers and grab the attention of children in attendance. Elmo and the Cookie Monster have both made appearances at events.

Taylor sees another advantage for firms that get involved with Week of Giving that goes beyond the good feelings generated by helping others.

Firms with a perpetuation problem, of which there are many in the insurance community, can use the Week of Giving as a way to help grow successors, she said.

Taylor suggests that firms consider nominating a young professional to lead a Week of Giving project, which will teach the person leadership skills and the importance of community involvement.

“It’s a way to get young employees to lead the way, and help train them and get then enthused,” Taylor said.

Since 1998, IICF supporters have provided nearly 200,000 volunteer hours, serving over 150 nonprofits nationwide, and involving over 200 industry companies and offices.

More information on the Week of Giving can be found at www.iicf.org/week-of-giving.

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VW Reports Business-as-Usual at Tennessee Plant Despite Scandal

VW Reports Business-as-Usual at Tennessee Plant Despite Scandal

Inside Volkswagen’s only U.S. assembly plant there’s little hint of the diesel emissions cheating scandal embroiling the German automaker around the world. Sparks fly off robotic welding arms, new versions of the Passat sedan roll off the line and workers install equipment to build a new SUV billed as a key to reviving the company’s growth prospects in America.

“Nothing has changed, and the factory construction goes on,” plant spokesman Scott Wilson told The Associated Press on a tour of the sprawling facility where Volkswagen plans to add 2,000 jobs as it expands the facility by 30 percent.

But despite the business-as-usual feel of the plant, production of diesel-engine vehicles has been put on hold by VW until they get more clarity on the consequences of the emissions scandal, which has already led to the CEO’s resignation, cost the company billions of dollars in lost stock value and unleashed a flood of lawsuits.

The carmaker has admitted that 11 million of its diesel vehicles worldwide were fitted with a program that duped U.S. testers into believing the vehicles meet environmental standards.

And while the full effect on demand for Volkswagen’s remaining vehicles remains to be seen, some Tennessee officials fear for job prospects at the plant that currently employs 2,400, where the average hourly wage is about $21 and perks include reduced-cost leases on VW vehicles with free insurance coverage.

Tennessee Gov. Bill Haslam said the scandal presents a “big hit” to Volkswagen’s status in the United States.

“My primary concern is getting Volkswagen back to where they’re in a mode to sell cars,” Haslam said. “Because, if they’re not selling cars, those 2,000-plus people working in Chattanooga’s life is going to look different.”

Workers at the plant have largely remained mum on the scandal.

Mike Cantrell, a quality control worker at the plant, said an initial wave apprehension among his colleagues has eased as operations at the Chattanooga factory have moved forward.

“You could just sense a lot of anxiety and a lot of questions people had,” said Cantrell, who also heads the United Auto Workers Local 43 at the plant.

Cantrell said some of those concerns were put at ease by VW leadership “taking more responsibility and working to rectify” the problem, leaving workers at the plant to focus on producing the new Passat and preparing for the SUV.

The UAW sees the Chattanooga plant as an opportunity to gain traction in a region where Republican politicians are hostile toward organized labor, and union officials frame their concerns in delicate terms. Secretary-Treasurer Gary Casteel in a statement said the union has offered its help for Volkswagen to “emerge as a stronger and more responsible manufacturer.”

Representatives of a rival labor group, the American Council of Employees, have not returned phone messages.

Volkswagen’s openness to organized labor has riled Republican Tennessee politicians including Haslam and U.S. Sen. Bob Corker. Another critic, Chattanooga state Sen. Bo Watson has called for hearings on the scandal, prompting company supporters to grumble that he wants to go after the automaker in its darkest hour.

Watson says the hearings are warranted, given the nearly $900 million in incentives that state and local governments have poured in to the project since VW announced it would locate the new plant there in 2008.

Tennessee’s incentive package to Volkswagen included everything from infrastructure and construction grants, tax credits and training funding to a “Volkswagen Chattanooga” sign on the roof of the plant that stretches the length of more than two football fields.

In a memo to lawmakers this week, the state economic development department stressed “assurances” from Volkswagen that plans at the plant are on track, and outlined the state’s ability to recoup portions of its latest $166 million grant if the company fails to average at least 80 percent of the promised new jobs there starting in 2020.

The emissions scandal hit at what was already a delicate time for the company suffering from declining sales following a 2012 sales bonanza surrounding the introduction of the U.S.-made Passat. Although Volkswagen executives made bold predictions of boosting Passat production by more than 60,000 vehicles in 2013, sales began what would become a 17 percent slide by the end of 2014.

Overall U.S. Volkswagen sales also dropped by a similar margin during that period as the company didn’t offer competitive products in key market segments like midsized SUVs or pickup trucks.

Volkswagen announced in July 2014, after repeated delays, that it would build the new seven-seater SUV in Chattanooga. Then-CEO Martin Winterkorn said at the time that the announcement sent a “strong signal for the U.S. as an industrial and automobile production location.”

Winterkorn resigned in disgrace shortly after the cheating scandal become public. But plant workers, the Chattanooga community and the state officials hope what he said then still holds true.


Volkswagen to Recall 11 Million Vehicles for Diesel Fix
U.S. Investors Sue Volkswagen Over Diesel Emissions Scandal
Car Dealers Sue Volkswagen Over Losses Tied to Diesel Cheating
How Regulators Caught Volkswagen’s Diesel Deception
Trying to Put a Price Tag on Volkswagen’s Emission-Fraud Scandal Copyright 2015 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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Insured Losses From Joaquin Might Be Minimal at This Juncture Macquarie

Insured Losses From Joaquin Might Be Minimal at This Juncture Macquarie

While still a major hurricane that turned into a Category 4 Thursday above the Bahamas, the estimated track for Hurricane Joaquin has continued to track further east of the U.S. in recent estimates. If the latest forecast holds, that could mean U.S. insurers’ losses from the storm might turn out to be minimal at this juncture, according to investment bank Macquarie Group.

Reports are still calling for significant amounts of rain over the coming days, which could result in some personal lines losses to cars and homes, Macquarie said in its research note Friday morning. But the firm also noted that the standard homeowners’ policy excludes flooding and any coverage would have been needed to be bought separately. At this juncture, it remains to be seen if this will even be a significant event, Macquarie said.

Even as recently as Wednesday, some weather models had forecast Joaquin tracking to the mid-Atlantic region. While forecasters haven’t ruled out a U.S. East Coast strike by Joaquin, more projections now are showing Joaquin will miss, the National Hurricane Center said.

The National Hurricane Center five-day tracking advisory for Hurricane Joaquin, Friday, Oct. 2, 11 a.m. EDT. Source: NOAA


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Consolidated Agency Partners iPrevision to Offer Cyber Risk Management Services

Consolidated Agency Partners iPrevision to Offer Cyber Risk Management Services

Consolidated Agency Partners, Inc. (CAP), a preferred carrier market access firm, and iPrevision, have formed a strategic alliance to enhance the cyber and data liability coverage needs of their members and clients.

iPrevision specializes in educating and training agency managers and sales professionals in the formation of a cyber & technology risk practice within an agency. In addition to their Cyber Risk Practice Program, iPrevision provides cyber risk mitigation products and services, including a new Social Engineering Assessment & Awareness self-paced training program for the agency and the agency’s clients and security ratings for cyber insurance.

CAP has offices in Northern Nevada, California and Michigan, and works with small-to medium-sized insurance agencies offering a range of commercial and personal lines carrier products from nationwide insurance carriers. Through the CAPNet Connect Portal, members are able to submit business and manage all of their quotes, written policies, and service requests.

iPrevision Insurance Solutions is headquartered in Southern California.

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Texas Hospital Should Forfeit 32M in Ike Funds Report States

Texas Hospital Should Forfeit 32M in Ike Funds Report States

A federal review says a Houston, Texas hospital should forfeit $32 million in government grants for Hurricane Ike recovery due to misuse of the money.

Riverside General Hospital was named in the Office of Inspector General report released this week. The hospital closed as of April.

Ike hit Galveston in 2008, swamping parts of the city and dumping heavy rain in the region. The hurricane caused $29 billion in damage and left more than three dozen people dead.

Hurricane Ike, Sept. 2008; Photo - NOAA

Hurricane Ike, Sept. 2008; Photo – NOAA

Riverside’s main campus and three other locations were damaged by the storm.

The ex-president of Riverside General Hospital, Earnest Gibson III, in June was sentenced to 45 years in prison on convictions for conspiracy to commit health care fraud and conspiracy to commit money laundering. Prosecutors say the case involved $158 million Medicare fraud.

Copyright 2015 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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