Common Reasons Claims Are Denied

The claims process for workers’ compensation can be notoriously complex and difficult to navigate. Each employer should make every available effort to smooth the claims process before it starts by providing adequate training to employees, including managers, and making sure that there are definite procedures in place for the process. Despite best efforts, claims can be denied. Understanding common reasons behind an initial claim denial can assist in smoothing the process.

 

One of the most common reasons for denial of an initial claim is filing a claim after termination .  In California, the statute of limitation on workers’ compensation claim is one year from the date the employee suffered the injury. If the injury was cumulative, meaning it was sustained little by little over time, this could be an exception. If the claim is filed after the statute of limitation has passed, the claim will probably be denied.

 

Another reason could be that the documentation backing the claim is inadequate or inaccurate. An employee needs to provide as much detailed and compelling medical documentation as possible. This includes not only the initial diagnosis, but also how this injury impacts the employee’s ability to work. Just because an employee provides documentation that he or she is injured, even if that injury seems significant, this is not enough. A key component of a workers’ compensation claim is determining an employee’s level of disability. Inadequate documentation supporting a workers’ compensation claim will likely result in the claim being denied.

 

A dispute between the employee and the employer is another common reason for claim denial. An employer may contest a workers’ compensation claim for a number of reasons. For example, an employer may dispute that an injury actually occurred in the scope of employment or that an injury occurred at all. In such a situation, it may be necessary for the employee to gather even additional evidence to resolve the dispute from the employer. Employers should be vigilant for a lack of documentation or other possible signs of fraud, and not be afraid to request additional proof. Workers’ compensation claims may increase an employer’s insurance premiums, so an employer needs to make sure that any potential claims are valid.

 If you have questions about your business and the workers’ compensation claims process, contact me today at (714) 516-8188. The claims process can be complicated, and you need an experienced attorney to walk you through it.

Regional Overview of California Workers’ Compensation Claims

Workers’ compensation is a system designed to make sure that employees who sustain work-related injuries are able to get the treatment they require. When handled properly, it can also help protect employers from liability. Different industries have different rates of workers’ compensation claims, as some types of jobs involve an inherently higher level of danger. Just as the frequency of claims varies from profession to profession, it also may vary by region.

A report released by the California Workers’ Compensation Institute determined that employees in California’s Central Valley have a different claims experience that those workers in other areas. The study determined that the time lag between when the employee notifies the employer of the work-related injury to the notification of the administrator to the initial treatment of the employee are significantly shorter than other regions in the state. The study went on to find that after twenty four months have elapsed after the initial injury, Central Coast claims average more medical visits for the purpose of rehabilitation, evaluation, management, or chiropractic care. The biggest difference, though, was in the surgery rate. Central coast workers’ compensation claims after 11.2 percent more medical payments for surgery than the rest of the state. However, the claims in the Central Coast seem to run significantly faster than in the other regions. The average claim lasts 325 days, which is two and a half months shorter than in other parts of the state. This is consistent with the fact that claims are addressed more quickly in this region over all. In 2015, the Central Coast accounted for 7.7 percent of all work-related injury claims in the state. Over the span of the last eleven years, the Central Coast accounted for an average of 6.7 percent of all workers’ compensation claims.

A large proportion of the claims reviewed in the study were agricultural claims. Almost eighteen percent of the claims involved in the study were agricultural claims. Despite this overall percentage, in the Central Coast, only 2 out of 10 job injury claims were related to agriculture.

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

Completed and Accepted Doctrine

The “Completed and Accepted” Doctrine has a long history in the State of California.  Over fifty years ago in Kolburn v. P.J. Walker Co. (2d Dist. 1940) 38 Cal. App. 545, a California appeals court established this doctrine.  This rule states that where an owner accepts the completed work under a contract, the contractor is not thereafter liable to other people who sustain damages arising from allegedly negligent construction.  The reasoning behind this is that once the contractor has finished the work and the owner of the property or item has accepted the work as complete, the chain of negligence is broken.  From there on out, it is up to the owner to maintain the property or work in good working condition and to prevent third parties from being injured.  Essentially, the owner has “accepted” the work as “complete,” and thereafter the burden shifts to the owner.

An illustration of how this doctrine could apply to a workers’ compensation case is provided from a recent unpublished opinion out of Los Angeles.  In that case, the plaintiff worked for Keogh Electric Corporation (“KEC”) on a project to build a distribution panel on top of a concrete pad for Kramar’s.  The panel and pad were installed in August 2012, and the plaintiff texted his boss at KEC that “Kramar is done.”  Kramar paid KEC for the work, and no other person from KEC was ever seen doing additional work on the project.  The plaintiff then accepted a job from Kramar.  In September 2012, the plaintiff tripped and fell into the panel and was injured.  He then sued KEC for negligence.  The plaintiff’s workers’ compensation insurance carried, Insurance Company of the West, intervened.  KEC argued that the plaintiff could not sue, and cited the Completed and Accepted Doctrine.  The appellate court agreed that the work was completed and accepted, and so the plaintiff’s lawsuit as well as that of the workers’ compensation insurance carrier was dismissed.  What this means is that because the work was completed and accepted, the plaintiff could not sue the original contractor for his injuries.  He was required to go through workers’ compensation against his current employer, if possible.  Moreover, the insurance carrier would not be able to recover its expenses paid out under the workers’ compensation claim against the original contractor.

Workers’ compensation can result in an unusual set of facts leading to an unexpected result in terms of who should be held liable for an employee’s work-related injuries.  If you have questions about workers’ compensation and your company’s liability, contact me today at (714) 252-7078 to talk about your business.

Overview of the Workers’ Compensation Process

Law suits can be a long and confusing process. Workers’ compensation law and claims are no exception. The fact that the process does not typically operate like a typical lawsuit makes it even more convoluted and obscure to the typical person off the street. This can really add to the stress and confusion experienced by the people involved in a workers’ compensation suit. A basic understanding of the process can help reduce stress and help you manage the process more efficiently.

The first thing that will happen must be the initial claim. After a worker sustains a work-related injury, he or she will need to make a detailed and accurate account of the related injury. The employer should also take reasonable steps to make sure the report is truthful and complete. This includes determining if there were witnesses to the event. If there were witnesses, the employer should be meticulous about gathering and maintaining written statements, and providing all of this information to the attorney responsible for defending and managing the workers’ compensation claim on the business’s behalf.

After the insurance company receives the statement, an investigator may  be sent out to examine the circumstances of the injury. The investigation will most likely include an on-site survey of the injury site but also an inquiry into the medical records of the injured worker. The investigation will need to look into the extent of the injury and whether it is long term or short term. These issues will obviously have a large impact on the nature, amount, and duration of the benefits awarded to the injured worker.  Following an investigation, there will likely also be an exchange of documents and information that is referred to as “discovery.”  During discovery, both the employer and the employee must exchange certain requested information, including medical records, employer reports, witness lists, and other pertinent material.

After the investigation, if the claim is still disputed, it may go before the Workers’ Compensation Appeals Board. The WCAB will hear the evidence from both sides. The board can then make a decision about whether the injured worker will receive benefits and for how long. If either the employer or the employee disagrees with the results, it is possible to appeal the finding to a higher court.

If your business is facing a workers’ compensation dispute, you need an experienced attorney on your side.  Contact me today at (714) 252-7078 to discuss your business and your case.

Medical Marijuana and Workers’ Compensation

Medical marijuana is becoming more and more common across the United States, and California is no exception. Supporters of medical marijuana proclaim its effectiveness against diseases and chronic pain, and some studies support these claims. Some workers who have sustained work-related injuries are seeking treatment that may include medical marijuana. The use of medical marijuana as a treatment for work-related injuries and whether workers’ compensation covers this type of treatment is not yet resolved. Many states have come to different conclusions, and California does not yet have a definite answer.

 

In Cockrell v. Farmers Insurance, an injured worker had chronic pain from a work-related injury sustained while working at Farmers Insurance. The worker requested that his medical marijuana prescription, which was given to help deal with this pain, be covered by his workers’ compensation benefits. The Workers’ Compensation Appeals Board held that California Health and Safety Code § 11362.7 protected Farmers Insurance from having to cover the medical marijuana. The WCAB based its ruling on the fact that the statute states that a health insurance provider is not liable for reimbursing for medical use of marijuana. However, the case was then sent back to the trial level to determine if a workers’ compensation carrier is a health insurance company, and whether it is accordingly exempt from covering medical marijuana claims.

 

Medical marijuana is further complicated by the fact that marijuana is illegal under federal law, and is classified as a Schedule I drug.  An employer should therefore be cautious when an injured worker returns to work if he or she has a prescription for medical marijuana. It is difficult to determine whether a worker is “impaired” under the use of marijuana. While this could also be said of other pain relievers, such as opioids, because marijuana is illegal under federal law, an employer should be certain to take extra precautions to make sure all workers are safe. Employers should also make sure to review their policies in place to make sure they are current with the latest in state and federal guidelines about the use of medical marijuana in the workplace and whether medical marijuana is covered under workers’ compensation claims.

 

If you have questions about medical marijuana and workers’ compensation, call me today at (714) 516-8188. This is an unresolved area of law and you need an experienced attorney working with you to protect your business.

ACA Repeal and Workers’ Compensation

Today’s shifting political landscape brings many challenges, including planning for the future. The new administration has repeatedly promised to repeal the Affordable Care Act. There are 20,000,000 Americans who currently have insurance purchased through the Affordable Care Act, and a total repeal will undoubtedly have sweeping effects.   These effects would extend to an impact on workers’ compensation.

 

Under the Affordable Care Act, workers’ compensation paid out fewer claims. In 2014, medical costs only rose by 3%, and in 2015, the costs dropped a percent. One reason this probably happened is so many more people had health insurance, due to the Affordable Care Act. As a result, workers’ compensation had to pay out fewer claims. This is because in cases where an uninsured, injured employee had non-injury-related conditions that had to be addressed as part of a treatment plan, workers’ compensation had to pay for the entirety of the treatment plan. However, where the worker had insurance, the worker’s health insurance would take over the portion of the treatment costs attributable to the non-injury related condition. Because so many more people have health insurance due to the ACA mandate, this means that the amount of workers’ compensation claims paid out decreased.

 

The President Elect and other Republicans have frequently promised to do a wholesale repeal of the ACA, which would include the individual mandate. If this happens, there would be definite effects on the workers’ compensation system. Without the individual mandate and the accompanying premium subsidy, many workers may drop their health insurance. This could lead to a higher burden on the workers’ compensation system. Another factor could be that typically people with health insurance are healthier than people without health insurance. This is because those with health insurance are more likely to seek medical care for their conditions or injuries. Without health insurance, it is more likely that an injured worker would have the extra health issues that a treatment plan under a workers’ compensation claim would have to treat. It is not clear exactly how much the ACA has reduced the cost of workers’ compensation claims, but logic dictates that it certainly has been a contributing factor.

 

The future for the ACA and workers’ compensation is unclear. If you have questions about your business’s workers’ compensation liability and future or current legislation, call me today at (714) 516-8188 for an appointment. We can talk about your business and your future.

Workers’ Compensation and Third-Party Claims

In California, an employer is required to carry workers’ compensation insurance to make sure that injuries suffered by employees in work-related incidents will be covered. However, there are some situations in which an employer may not be completely responsible for an employee’s injuries. For example, if an employee is injured because of a scaffolding collapse, and the scaffolding company negligently produced the product, then there is an additional issue in the case of the scaffolding company’s liability. This is called a third-party claim, and provides options for both the employer as well as the injured employee.

If an employee’s injuries were influenced by the actions or negligence of a third-party, then the employee has a cause of action against that third-party. The employee has the right to bring a case against the third party for their actions at the same time the workers’ compensation claim is pending. The employee would bring a personal injury lawsuit against the third party, which is obviously different than a workers’ compensation claim against an employer. This is called a “cross over case”. In the personal injury case, the employee will need to prove that the third party’s negligence or actions contributed to the injury.

In the event the employee wins the suit against a third party for the personal injury, then the employer has the right to be reimbursed from the money award received by the employee for any workers’ compensation benefits already paid by the employer. The reason for this is to prevent an employee from “double dipping,” i.e. receiving an award from the employer and also an award from the third party for the same injuries.

In order to recover any amounts under this theory, an employer has several options. The first would be to settle with the third party out of court. If this is not an option, the employer can also directly sue the third party. The employer may also join in the action already filed by the employee. Finally, there is also a possibility for the employer to file a lien against an award. If the employer takes the option of filing a lien against the employee’s award, the employer will only get paid after the employee’s attorneys’ fees and litigation expenses have been paid out of the settlement.

If your business has the potential of a third party case, you need an experienced attorney on your side. Call me today at (714) 516-8188 for an appointment to discuss your business’s third party claim.

Professions Most Susceptible to Workers’ Compensation Claims

Every employer strives to make their work-site as safe and accident-free as possible. In recent years, the number of work-related injuries has declined, due in part to these efforts as well as advancements in technology and methodology. However, there are some professions that are still very susceptible to work-related injuries and, by extension, workers’ compensation claims.

Transportation workers, and in particular, truck drivers have a high incidence of work-related injuries. Unfortunately, truck drivers tend to face many dangers in their day-to-day jobs. Another driver who is speeding, intoxicated, or driving while distracted could cause an accident, resulting in injury to the truck driver. Drivers face other potential injuries, however, while not on the road. A driver may be injured while handling heavy trucking equipment or raising the truck hood. Loading and unloading cargo or even slipping and falling from loading docks also pose dangers. Employers should be on the watch for ways to make sure their drivers are aware of all of these potential dangers and to limit the risk.

Another profession that is particularly susceptible to workers’ compensation claims is construction work. Construction sites are dangerous places and there are a variety of different injuries that can occur. Falls from ladders, scaffolding, roofs, or other elevated surfaces are particularly common. Being struck by a falling or improperly secured object is also quite common. Being caught between large objects such as trucks or other large vehicles poses a great danger. Finally, certain specific construction workers may also be in danger of being electrocution, such as electricians. Construction workers should also be alert for their tools of the trade. Employers need to make sure that tools, equipment, and vehicles are in good repair and do not pose a danger to their employees. In addition, employers need to be aware of any special training or safety gear that employees may need to provide extra protection from work-related injury.

Finally, law enforcement officers are definitely at risk of work-related injury. California law also provides extra protection to law enforcement officers, by providing that certain injuries are “presumptive” injuries, including heart trouble, hernias, and pneumonia. Firefighter also receive special consideration for particular types of cancer in workers’ compensation claims.

If you are an employer in an industry with a high risk for workers’ compensation claims, call me today at (714) 516-8188. We can discuss your business and its future.

What is the UEBTF

Under California law, all employers (with very few exceptions) are required to carry workers’ compensation insurance. This law is meant to ensure that all employees injured on the job will receive fair compensation. Even if an employer does not carry the mandatory insurance, an employee with a work-related injury is still entitled to compensation for medical treatment and other related benefits. In the case where an employee is injured while working for an uninsured employer, the employee may apply for benefits from the Uninsured Employers Benefits Trust Fund (UEBTF), which is funded through a tax that is placed on every workers’ compensation policy premium in the state of California, as well as fines and penalties collected from any illegally uninsured employers.

The UEBTF is a fund held by the State of California to make sure that employees with work-related injuries can still obtain the monetary benefits they would receive if they had been working for an employer who held the required workers’ compensation insurance. The UEBTF was established in 1971 in an effort to make sure that employees with work-related injuries receive compensation even if their employer was illegally uninsured. An employee who receives a work-related injury may seek a judgment from the Workers’ Compensation Appeals Board (WCAB) for the amount of their medical costs and other injuries as allowed by California workers’ compensation law. After an employee receives an award from the WCAB, then he or she may apply to the UEBTF for compensation if the employer was not insured at the time of the injury, and the employer fails to pay the award within 10 days.

If an employee successfully receives compensation from the UEBTF, that does not mean that the uninsured employer is off the hook for the costs of the employee’s medical care or other expenses. After the UEBTF expends funds to compensate the employee, the UEBTF will then seek to be reimbursed for those expenses paid by the UEBTF from the uninsured employer. It does this by seeking to place a lien on the assets owned by the uninsured business. The business will receive a Special Notice of Lawsuit before the UEBTF becomes a party.  After the UEBTF becomes a party,  a lien can be placed by the UEBTF on all assets of the business and any substantial shareholders. Recoveries from illegally uninsured employers are another source of funding for the UEBTF.

If you are facing a lien or action from the UEBTF call me today at (714) 516-8188. I look forward to discussing this process with you and helping your business with the complicated issues associated with it

Key New Laws for Employers from 2016

This past year saw many new laws come into effect, passed by the California legislature, or signed into law by the Governor. Understanding changes in the law is vital to keeping your business in compliance and avoiding penalties, both civil and criminal.

AB 622 came into effect on January 1, 2016, and is now codified in California Labor Code 2814. This law was passed in an effort to prevent discrimination against those who are not permitted to work under federal law, as is the case for undocumented immigrants. Pursuant to Labor Code 2814, an employer may not use the E-Verify system to check whether an employee is authorized to work before making an offer an employment, unless such a check is required by federal law. The employer is still permitted to use the system to check the employment status of employees already employed by the employer.

Another new law is AB 2883, which will go into effect on January 1, 2017. This law creates a large change for small businesses and closely held corporations. The law currently in place states that although employers must carry workers’ compensation insurance for all employees, “employee” did not include offers or directors of private corporations where those officers were the sole shareholders, or all working members of a partnership or a limited liability company. The new law, however, revises these exemptions. As of January 1, 2017, the exemption for officers or members of the board of directors only applies if the member owns at least 15% of the corporation’s stock, or in the case of the general member of a partnership or managing member of an LLC, that the person elects to be excluded by executing a document affirming that he is a qualifying office, director, general partner, or managing member. This document is signed under the penalty of perjury.

Next, SB 623 modifies that benefits can be received under the Uninsured Employers Benefits Trust Fund and the Subsequent Injuries Benefits Trust fund. California law states that immigration status shall not have an impact on an injured workers’ ability to file for workers’ compensation. Under this new law, immigration status also will not act as a bar to applying for benefits under the UEBTF or the SIBTF.

Finally, under SB 560, the Contractors State License Board may now inspect certain job sites. This law allows the Board to conduct investigations and enforcement of licensees to make sure that they are carrying valid and current workers’ compensation insurance. The Board must also provide information regarding licensees to the Employment Development Department.

It is of central importance that your business conforms to the changing landscape of the law. Call me today at (714) 516-8188 for an appointment to discuss your business’s compliance with California Labor Code.

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