Workers’ Compensation and Statutes of Limitation

When an employee sustains a work-related injury, there are many steps and a lot of paperwork that needs to be completed as quickly as possible.  The beginning of a workers’ compensation case is mostly punctuated with trying to make sure an employee gets lined up with the proper medical professionals as soon as possible, as well as efforts by the employer to determine just how the injury occurred.  To make sure that efforts are made promptly to seek appropriate medical care and to allow a proper investigation to be conducted, California has enacted a series of statutes of limitations which provide for strict timelines when particular claims and tasks must be completed.

A statute of limitations is a law that states a particular amount of time in which a plaintiff has to bring legal action.  In the context of workers’ compensation, this means the deadline by which an employee who sustained a work-related injury must notify his or her employer and must file a claim.  California Labor Code 5405 provides that an injured employee has one year from the date of the injury to file for workers’ compensation benefits.  Although this sounds simple, there are important complications.  An employee is required to provide notice to his or her employer within thirty days of the injury, or in the case of a cumulative injury, the date when the employee became aware of the disability or should have been aware of the disability when exercising “reasonable due diligence.”  Similarly, claims for serious and willful misconduct or claims for discrimination under Labor Code section 132(a) must also be brought within one year.  In workers’ compensation cases involving the death of an employee, the employee’s family must file for benefits within one year of the employee’s death, but no longer than 240 weeks from the date of the injury.  It is important to note that although workers’ compensation claims may be barred after a year, an employee may still be able to file a personal injury claim against a third party for up to two years.

Employers should also be aware that employees have gotten permission to continue on in workers’ compensation cases filed outside the statute of limitations period in some situations.  Several notable cases provide that where the employer failed to provide particular written notice of rights to employees, the statute of limitations may be tolled.

Statutes of limitations may seem straightforward at first glance, but there are many exceptions and nuances.  If one of your employees has sustained a work-related injury, contact us today at (714) 516-8188 to discuss crucial deadlines you need to know.

The Gregory Formula

Workers’ compensation benefits are designed to help an employee who has sustained a work-related injury by paying for related medical expenses.  The injured employee may receive a large variety of treatments including, but not limited to, physical therapy, prescription medication, chiropractic care, psychological services, or the use of durable medical equipment.  An employer may very well be on the hook for the costs of these services.  When providing medical care to an injured employee, medical providers and group health insurance providers may file liens against the workers’ compensation recovery in order to ensure reimbursement for care provided to the employee.  Ultimately an employer and an employee may agree to settle the workers’ compensation claim by a compromise and release agreement.  In a case styled Kaiser Foundation Hosp. v. Workers’ Comp. App. Bd., the WCAB addressed the issue of what happens when the medical providers who have filed liens do not agree with the amount settled on in the compromise and release agreement.

In that case, four separate cases were consolidated for consideration by the WCAB.  The issue revolved around how much a lien claimant should recover in a denied case.  It was proposed that the Lien Claimant should be eligible for the same ratio of recovery that the injured worker accepted as settlement of the case.  Where the lien claimant does not agree with the amount of the settlement compromise, the workers’ compensation referee shall “determine the potential recovery and reduce the amount of the lien in the ratio of the applicant’s recovery to the potential recovery in full satisfaction of its lien claim.”  The court stated that the phrase “potential recovery” means “the amount of recovery which is reasonably probable” in a contested trial, examining the entire record.  The proposed settlement should include the formula for determining the reduction of the lien, called “the Gregory Formula,” and the computation of the potential recovery needs to include a variety of figures, including the percentage of disability, medical expenses, and the duration of future medical expenses.  In the simplest terms the proposed recovery is a fraction, where the actual settlement amount is the top number (numerator), and the total reasonable case value if Worker won at Trial is the bottom number (denominator).  Basically, if the Injured Worker accepted 25% of the potential case value as settlement, that number could be attributed to the lien claimants.  These need to be set forth in specific detail for the judge.  These figures have to be disclosed to the lien holder to allow it to examine the basis on which the settlement would reduce the award against it.  If the Lien Claimant objects to the formula after notice, the WCAB may withhold that lien from resolution, and give the Lien Claimant an opportunity to independently prove up an injury.  The lien claimant then runs the risk of zero recovery if they fail to independently prove an injury.

If you have a question about how the Gregory Formula could help reduce the financial liability of your business during a workers’ compensation case, contact me today at (714) 516-8188.  We can discuss your business and your options.

How and When Workers’ Compensation Benefits Are Paid

The workers’ compensation system is designed to help employees when they get injured at work.  Employees will be entitled to receive a variety of different type of payments, including temporary disability, permanent disability, and medical costs.  Understanding when and how these payments are made can be immensely helpful to getting a better grasp to how the workers’ compensation system works.

Temporary disability is either temporary total disability, i.e. when the employee is not able to work at all during recovery, or temporary partial disability, meaning the employee can work, but not work a full schedule while recovering.  Temporary disability payments are two thirds of the gross wages the employee receives, although there is a cap set by state law.  The temporary disability payments begin after the employee’s medical provider determines that the employee is unable to work for at least three days.  Payments are made directly to the employee, and are made every two weeks.

Permanent disability means that the employee has a lasting disability that permanently reduces the employee’s earning capacity.  The employee may be entitled to permanent disability payments even if he or she is able to return to work.  After a doctor determines that an employee’s injury has become “permanent and stationary,” meaning the employee’s injury has reached the maximum level of recovery, the amount of permanent disability must be determined according to very particular formulas.  The percentage of permanent disability will be converted to a specific dollar amount, based on average weekly rages at the time of the injury.  The permanent disability payments are made directly to the employee, and must be paid within fourteen days after temporary disability payments end.

Medical payments are typically handled directly between the health care provider and the workers’ compensation insurance company.  The medical provider will bill the workers’ compensation insurance company directly for the cost of medical services and devices.  If the worker’s claim is accepted, the medical provider is not permitted to bill the injured worker for the balance of services rendered if the workers’ compensation insurance company does not provide as much payment as they usually receive.  The employee will only receive copies of the bills from the medical provider if he or she specifically requests to receive them.

The timing and method of workers’ compensation payments can seem overwhelming.  Call us today at (714) 516-8188 and let us help you understand the system.

Developing a Return-to-Work Policy

Workers’ compensation is designed to help get a worker who sustains a work-related injury recompense for their lost wages and medical expenses.  The worker wants to get back up on his or her feet and get back to work as soon as medically possible, in most cases.  Employers should be mindful of this and are obligated to help their employees by making certain accommodations for the injured worker.  This benefits both parties, as the employee can get back to work and the employer no longer has to worry about certain job duties needing to be covered by other workers.  To this end, employers need to work to develop a return-to-work policy that helps employees return quickly and safely to work.

An employer should take proactive steps to help an employee return to work.  This includes reaching out to the employee and his or her medical providers to determine the nature and the extent of the injury.  Employees and employers should keep an open dialogue about what is medically appropriate for the employee in terms of job duties and needed accommodations, and come to an agreement about what any type of modified duties will include.  This will necessarily include making sure that the medical providers agree with the restrictions and abilities of the employee.  An employer should research and evaluate the possible restricted work duties that are available in the business and make an offer of modified employment accordingly.  In the optimal situation, the employee will be able to remain in his or her original position with some accommodations that take the injury into account, but it may be necessary to assign him or her to a different position during the healing process.  After the employee starts on the new position, the accommodations should be monitored and modified as necessary.

Developing a plan to implement this return-to-work policy should be a group effort.  There may be several different people involved in this process, and an employer should keep in mind what other employees would be best suited to help with each step.  For example, the floor supervisor would be an excellent resource to ask about reasonable accommodations that are available, but may not be best suited to ask to retrieve paperwork from medical professionals.  Each step should be thoughtfully mapped with each employee knowing precise roles.  The employer should put particular emphasis on getting all paperwork done promptly and with a high degree of detail.

Implementing a return-to-work policy is an essential step for businesses and should be done with mindfulness.  Contact us today at (714) 516-8188 to talk about your policies and your business.

Independent Medical Reviews

Following an incident at work wherein an employee sustains a work-related injury, that employee may need to seek medical treatment.  A workers’ compensation claim is almost sure to follow shortly thereafter.  A worker may be entitled to have the costs of his her or medical appointments and treatment covered by the employer or the employer’s insurance under the workers’ compensation system.  However, in some cases, there may be a dispute between the employee and the employer about whether a particular injury is of such a nature as to be covered under the workers’ compensation claim.  An Independent Medical Review (IMR) is one way that these disputes may be resolved.

Once an employee sustains a work-related injury and gets involved in the workers’ compensation system, a request for a particular course of medical treatment must pass through a “utilization review” procedure.  This review process is to make sure that any treatment prescribed by the treating physician is actually medically necessary to treat the work-related injury.  In some cases, the utilization review board may modify or deny the treatment recommended by the doctor.  If this happens, the injured employee may request that decision be reviewed through the IMR process.

Upon receipt of denial by the utilization review board, an employee may request an IMR by filling out and faxing in specific forms that will be provided to the employee.  The state will then decide within thirty days if an IMR is appropriate in the particular case.  If it is decided that an IMR is appropriate, a physician will be assigned to the employee’s case.  Note that this is a doctor chosen by the state, and not by either the employee or the employer.  The employee, employer, and insurance company will have the chance to send supporting documentation to the independent physician.  The independent doctor will review all of this documentation and then make a determination as to whether the treatment prescribed by the employee’s own physician is actually necessary to treat the work-related injury.  The independent doctor does not actually examine the employee at all.  It is all done through examination of medical records and documentation.  If the independent doctor does decide that the treatment is necessary, then the treatment must be then authorized by the insurance company within five days of receiving the IMR decision.  The overwhelming majority of IMR decisions uphold the determination initially made by utilization review.

If you have questions about your business and workers’ compensation, contact me today at (714) 516-8188. I am highly experienced in guiding my clients through this complicated area of law.

Workers’ Compensation Lien Process

After an employee sustains a work-related injury, there are a number of processes which must be set in motion. The injury must be properly documented, witness statements need to be taken and filed, notice needs to be sent to insurance companies, and a variety of other procedures. Many of these procedures, such as medical appointments, attorneys, and living expenses involve the exchange of funds on behalf of the injured worker or his or her family. In some cases, a lien may be filed against the worker’s compensation claim in order to obtain reimbursement for these expenses.
Not every type of expense associated with a workers’ compensation case is eligible to file a lien against a claim. The expenses eligible are: attorney fees, burial expenses, living expenses for the spouse of the injured employee and minor children, unemployment disability benefits paid while waiting on a determination of the work-related injury, unemployment benefits paid to the extent that the payments overlap the time period that an employee is entitled to temporary total disability, indemnification granted by the California Victims of Crime Program, and reasonable expenses incurred by or on behalf of the injured worker for medical treatment, unless those treatments are subject to a dispute involving an independent medical or bill review.
Medical treatment expenses are typically the most common liens filed against a workers’ compensation pay out. In order to file a lien, a filing fee of $150 must be paid, although there are certain types of claims that are exempt from the fee. Other types of liens, such as burial fees, attorney fees, spousal expenses and several others also are not required to pay a filing fee. If a filing fee is required for a lien and the fee is not paid, the lien will be considered invalid and it will be as if the lien was never filed. Liens must be filed electronically, using one of two methods, called E-Form or Jet File. All liens must be reviewed by and approved by the Workers’ Compensation Appeals Board. A lien is only payable once the WCAB has issued an order allowing payment of the expense.
Liens are an effective method to make sure that those associated with a workers’ compensation case receive compensation for services rendered, and also to ensure that a worker does not receive double payments from both the disability system and the workers’ compensation system. If you have a question about liens in workers’ compensation cases, contact me today at (714) 516-8188. We can discuss your business and the lien process

Social Security and Workers’ Compensation

In California, as well as across the nation, employees sustain work-related injury every day. When this happens, employees may be eligible to file a claim for workers’ compensation against their employer in order to pay for the medical costs associated with their injury, as well as some other stipends in some situations. California employers are required by law to carry workers’ compensation insurance in order to make sure that workers are adequately compensated when they sustain qualifying work-related injuries. Workers’ compensation provides an alternative to litigation and help to streamline the process, and by operating outside of the traditional court system, prevents the courts from having dockets clogged with workers’ compensation issues.

Social Security disability is a separate system, although it also is designed to assist people who are unable to work. The essential difference between Social Security disability benefits and worker’ compensation is that workers’ compensation is designed to provide compensation for work-related injuries. An individual who is injured outside of his or her employment may not receive compensation under workers’ compensation. Conversely, Social Security disability may allow an individual to seek to make up for lost income when he or she has an injury or illness that occurred outside of employment but still prevents the individual from working.

There are some occasions wherein a person may apply for and receive both workers’ compensation benefits and Social Security disability benefits. The first requirement is that you must be injured or expect to be injured for at least a year plus a day. A worker who has a terminal illness could also qualify. An injured worker must also have paid in to the Social Security system for a minimum amount of time, which is typically at least ten years. In such a situation, an injured worker could potentially receive both types of benefits at the same time. It should be noted, however, that the amount an injured employee receives through Social Security may be at least partially reduced by the amount received through workers’ compensation. This is different than unemployment benefits, as typically an injured worker may not draw both unemployment benefits and workers’ compensation at the same time.

 If you have questions about how to make your workplace safer and safety committees, contact me today at (714) 516-8188. We can talk about protecting your employees from injury, and your business from future litigation.

Home Healthcare and Workers’ Compensation

For obvious reasons, workers’ compensation is intricately intertwined with the health care industry. This may include hospital stays, physical therapy, chiropractic services, psychological treatment, or an enormous variety of other services, depending on the nature of the work-related injury. With respect to home healthcare, employers need to be aware of two different potential issues that are related to workers’ compensation.

The first potential issue is if the employer’s own business is to provide home healthcare services. In California, it is required that all employers provide workers’ compensation insurance for all of their employees, with a few limited exceptions. The home healthcare industry is not one of those exceptions, in and of itself. In other words, chances are that your home healthcare business is required by California law to carry workers’ compensation insurance. Although home healthcare is not typically thought of as a “high risk” industry, there are many hazards inherent in the home healthcare business. Home healthcare providers are always inside of unfamiliar homes that may not be very clean or safe. Even if the home is completely free of typical hazards, simply being unfamiliar with surroundings can lead to more injuries. Accordingly, it is essential that home healthcare business owners not ignore the workers’ compensation insurance mandate.

The other potential issue could be whether an employer of a worker who has sustained work-related injuries is required to pay out a claim for home healthcare. This issue was addressed in a WCAB case called Hernandez v. Geneva Staffing, Inc. that was handed down in June 2014. In that case, a worker had a severely injured hand and received home healthcare services from his wife. He submitted a claim to his employer for payment for those home healthcare services. The employer denied the claim, based on the fact that the employee failed to provide a valid medical prescription for the home healthcare services. The WCAB explained that an employer may be liable to pay for home healthcare services where certain conditions are met, such as a valid medical prescription. The WCAB also explained that the amount that the employer may be liable for is limited by the Official Fee Schedule.

Employers of any industry have many responsibilities toward their employees when it comes to workers’ compensation. Call me today at (714) 516-8188 and let me review your business’s obligations with you.

How the Employer Can Smooth the Claims Process

As an employer, it is important to understand your responsibilities under the California workers’ compensation system. Unfortunately, the system can be complicated and confusing. No employer wants to hear that his or her employee has suffered a work-related injury. However, if certain steps are taken before the injury has happened, then a business may smooth the claims process. These steps can help take out some of the confusion and stress that typically accompany any involvement with the workers’ compensation system.

The first steps should be taken before an injury actually happens. Reviewing your safety procedures, implementing a safety program, and creating safety committees are all ways that you can make sure that your workers are as safe as possible. A business owner should also make sure that proper training is provided not only to new workers but also existing employees and managers. Create a written guidebook for managers to review and learn so that they all understand the steps that must be taken in the event that an employee does sustain a work-related injury.

If an employee is injured on the job, the employee should be provided immediate and appropriate medical attention. Even if an employee tries to downplay the severity of the injury, he or she should be encouraged to obtain assistance. Ignoring injuries can exacerbate the condition, leading to higher costs for the business because of aggravated injury. This is especially the case where soft-tissue injuries are concerned. Discuss possible accommodations for the worker with him or her, as well as the treating physician, where appropriate.

The claim should be immediately reported to the insurance carrier. If there are witnesses, their statements should be taken promptly, while their memories are fresh. Similarly, all the paperwork required by your insurance carrier needs to be completed promptly. Delaying this essential paperwork will only prolong the process. Business owners should be involved and diligent in this process, and review the details in the paperwork to ensure accuracy. It can also be important to stay engaged and interested with the injured employee. This can help to get a more precise idea of the nature of the injury, different accommodations that should be made, and when he or she would be likely to be able to return to work.

The workers’ compensation process can be confusing, and you need an experienced attorney to help guide you through the claims process. Contact me today at (714) 516-8188. We can review your business and make sure that you are doing all you can to smooth the claims process.

Executive Opt Out Rule

The general overarching rule in California is that employers are always required to carry workers’ compensation insurance to cover their employees in case of injury on the job. There are exceptions, however, such as if the business is self-insured. With the new year, some of the exceptions have changed. One such example is what is referred to as the “executive opt-out rule.”

Before 2017, the executive opt-out rule was that certain high-level officials in California businesses had to affirmatively opt-in to workers’ compensation coverage. In other words, they had to take action in order to be covered. The new rule expands their coverage somewhat. It reverses the previous position, and states that if an executive does not want workers’ compensation coverage, he or she must affirmatively opt-out of coverage. This rule does not include any “high level” employee. The employees covered under that rule are corporate officers or directors who are the sole shareholders of the business. It also covered working members of a limited liability company or a partnership. The new rule, which is found in AB 2883, states that as of January 1, 2017, all officers or members of boards of directors who are employees of a company must be covered by workers’ compensation insurance, as any other employee. The only exception to this is if the officer or member of the board owns at least 15% of the outstanding stock for the corporation, and also executes a sworn statement that he or she is eligible for the exemption of workers’ compensation insurance coverage. Moreover, working members of a limited liability company or partnership who receives wages from that limited liability company or partnership may also qualify for the insurance exemption. In order to be exempted, he or she must 1) be a managing member of a limited liability company or a partner in a partnership, and 2) execute a waiver, just as the members of the boards of directors. This waiver is only effective once it has been signed and received by the workers’ compensation insurance company.

The general aim of this law is to expand those who are covered under workers’ compensation insurance in the state of California. It prevents owners of small businesses from giving an employee a false title in order to avoid providing workers’ compensation insurance for those employees, as was possible under the old rule.

These rule changes could have a big impact on your business. If you have a question about your responsibilities under the new law, contact me today at (714) 516-8188. We can discuss your business and how to make sure you are in compliance.

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