Louisiana's Medical Claim Process Upheld

In October 2018 the Louisiana First Circuit Court of Appeal rendered its decision in Barber v. Louisiana Workforce Commission, et. al. (this has not been released for publication yet, and is therefore subject potentially to change). This followed a trial court permanent injunction that precluded the Commission and its agents "from applying and/ or enforcing certain statutory provisions and regulations regarding the medical treatment schedule authorization and dispute resolution procedures."

The Court recited that the dispute originated from 2009 legislative amendments to the Louisiana workers' compensation statute. The purpose was "to establish meaningful guidelines for the treatment of injured workers." This is similar to the Medical Treatment Utilization Schedule (MTUS) enacted by California, discussed recently in IMR in Florida and IMR and Due Process. The California MTUS treatment guidelines were adopted from a publication of the American College of Occupational and Environmental Medicine (ACOEM), published by ReedGroup Ltd. Louisiana elected not to adopt any group's guidelines, but instead created its own. 

In the two recent posts, it is suggested that IMR as a process needs the foundation of at least treatment guidelines. It is probable that the adoption of a pharmaceutical formulary is as necessary to the success of IMR. Each of these standards provides an objective and transparent representation of the appropriate care in the broad sense of a particular diagnosis, subject to narrowing to a more specific focus potentially as regards a particular patient. 

When the Louisiana Legislature mandated the adoption of treatment guidelines, a constitutional challenge was raised. The Office of Workers' Compensation (OWC) created guidelines and defined a process for the determination of medical disputes. Disputes were to be administratively determined by "a medical director employed by the OWC and administrative appeals therefrom to the OWC judges."

In June 2015, the trial court concluded that the treatment guidelines and regulations were "unconstitutional as violative of the Due Process Clause of the Fourteenth Amendment to the United States Constitution and Louisiana Constitution Article I, Section 2." It found fault in terms of specificity, "both substantive and procedural due process," and that the change "violates the separation of powers doctrine." The trial court therefore issued a "preliminary injunction" and precluded the state from "applying and/or enforcing" the treatment guidelines. See Another Unconstitutional Statute. 

The trial court was reversed in October 2015 by the Louisiana Supreme Court. It concluded that "the constitutional issue was not properly raised in the trial court." It identified other flaws in the trial court decision and transferred the appeal to the Appellate court for review of the judgment. This blog was critical of the trial court for allowing lawyers in the case to draft the court's decision; drafting orders is the judge's job. In June 2016, the appellate court reversed the trial court injunction.

The matter thus returned to the trial court for consideration of the merits of the claims of constitutional infirmity. In March 2017, the trial court judgment was entered "permanently enjoining, restraining, and prohibiting defendants from applying and/or enforcing" the treatment guidelines and process. The Court also:

"enjoined, restrained, and prohibited the defendants from allowing anyone to attempt to communicate with judges of the OWC regarding pending workers' compensations claims."

The OWC judges were directed by the trial court to make decisions regarding medical claims based only upon "the facts and law presented to them on the record." This communication prohibition is consistent with both judicial independence and the prohibition on ex-parte communications with judges. 

The Circuit Court of Appeal addressed the separation of power complaint. It noted that the new legislative process, of review by the "medical director," was a significantly more rapid process than had previously existed. There was testimony regarding the overarching theme of workers' compensation, an:

"affirmative duty to provide all reasonable and necessary medical treatment and provides that such treatment shall be delivered in an efficient and timely manner"

The Court recited the purpose and restraints of delegated legislative authority and separation of powers. It explained legislative delegation, and the ability of an agency to promulgate rules generally, as well as the specific promulgation authority stated in statute. Ultimately, the Court concluded that the OWC Director's adoption of guidelines and procedure were not violative of the separation of powers clause. 

Turning to due process, the Court explained "substantive" due process:

"Substantive due process may be broadly defined as the constitutional guaranty that no person shall be arbitrarily deprived of his life, liberty, or property."

Focusing on the substantive, the Court concluded that a "claim for workers' compensation benefits" is a "property interest" protected by due process. But, the Court agreed with the OWC contention that the regulations and guidelines were 

"rationally related to the legitimate government interest of protecting injured workers from undergoing medically unnecessary treatment and doctors from rendering services without compensation."

Thus, the Court concluded the challengers had not proven "that the tacit denial provisions are unconstitutional."

The Court rejected the challengers' claims that the regulations were "fatally vague" and thus a violation of due process. The Court explained that the standard for vagueness is "when a person of ordinary intelligence does not have a reasonable opportunity to know what is prohibited" or a law that does not include "a standard to prevent arbitrary and discriminatory application." The Court concluded that the challengers did not demonstrate the regulations in this instance are "unconstitutionally vague."

Specifically regarding the process of medical denials being reviewed by the "medical director and thereafter to an OWC judge," the Court addressed the challenger's allegations that procedural due process is not afforded as "an injured worker is not provided an opportunity to be heard at any level." That is, there is no hearing. And, there is no opportunity to "object to information or documents," or any opportunity before the medical director to "present evidence, examine witnesses, or be informed as to what information or documents have been submitted to the medical director."

The Court explained that this challenge was one of "procedural due process." That right is to "be heard at a meaningful time and in a meaningful manner." How much procedural process is "due" is dependent upon the situation, as the Court noted it is "a flexible standard." The Court concluded that in an "administrative action, the judicial model of an evidentiary hearing is neither required nor even the most effective method of decision making in all circumstances," citing the United States Supreme Court. 

The opportunity "to present their case" must be "meaningful," but not necessarily a hearing. The Court cited the legislative intent, a "rational policy choice by the legislature," to determine medical necessity in advance "to avoid case-by-case disputes and variations and to streamline the process." Ultimately, it concluded "the private interest affected by the statutory and regulatory provisions at issue is substantial," but the procedure for medical determinations by the medical director was not shown to violate procedural due process. It specifically noted that there is the right to review by an OWC judge that includes the right to present "additional evidence." 

Admittedly, the standard in the OWC judge proceeding is "clear and convincing evidence," but it is an opportunity nonetheless. This is important because it means a worker faces a significant burden in seeking an OWC judge alteration of the medical director's decision. Of note, the same "clear and convincing" evidence standard has been adopted in regard to the opinions of Expert Medical Advisors  (EMA) in Florida. See section 440.13(9)(c). In Louisiana, "clear and convincing":

"means to demonstrate that the existence of the disputed fact is highly probably, in other words, much more probable than not."

The Court acknowledged that the challengers did not agree with the procedural process adopted by the Legislature. However, it noted that disagreement "does not establish that the process itself is arbitrary."

The medical decision-making process outlined by the Louisiana Legislature is thus upheld by the Court of Appeal as regards all challenges raised in Barber. This outcome is not inconsistent with the California Court conclusion in Stevens v. Workers' Compensation Appeals Board, discussed at length in the two prior IMR posts mentioned above. A notable distinction, however, is that the Louisiana decision is not predicated upon a specific state constitutional provision or "plenary power," as mentioned in Stevens. 

The singular important point on which the Barber Court affirmed the trial court regarded the evaluation of OWC judge's performance. Though there was testimony that administrators were cautioned not to direct judges as to how they should rule in a case, the Court held that " an independent and honorable judiciary is indispensable to justice in our society." It conceded that OWC judges are not part of the judiciary, but acknowledged their judicial function. It stated that due process guarantees require the "essential" element of "an impartial decision-maker." 

As such, the Court affirmed the trial court

"judgment permanently enjoining defendants from allowing anyone to attempt to communicate with OWC judges regarding pending workers' compensation claims."

Administrative oversight of the finder of fact, the adjudicator, is not wholly precluded. However, the decision-making process has to be protected from both interference and the implication of interference or imbalance. This is consistent with the fundamental of judicial independence, which every adjudicator must strive to maintain. And that will be the subject of a future post. 

IMR and Due Process

The Florida workers' compensation marketplace was recently introduced again (This blog introduced the concept in July 2015: Another Unconstitutional Statute - and it's not Florida) to the idea of Independent Medical Review (IMR) by the publication of a report by Florida Tax Watch. The fundamentals of the IMR process are discussed in IMR in Florida? Beyond the overview of IMR, however, is the oft-noted "due process concerns" of the IMR process. Though IMR is reasonably recent, having been enacted by the California Legislature in 2012, there is some California decisional authority on that precise point. 

In 2015, the California First District Court of Appeal decided Stevens v. Workers' Compensation Appeals Board, 241 Cal.App.4th 1074 (Cal. Ct. App. 1st 2015). It includes some history of California statutory changes in 2004 and again in 2012. The 2004 changes created a process called "Utilization Review," (UR) and established that "a request for treatment cannot be denied by a claims adjuster and must be approved unless a clinician determines that the treatment is medically unnecessary." The 2004 law also required the adoption of treatment guidelines, titled the "Medical Treatment Utilization Schedule," (MTUS).

California UR, the Court noted, is not bilateral. The UR decision can be challenged by the injured worker, but not by the employer. For employers, the UR process is binding. If the UR determines the requested care to be appropriate, it must be provided, and the employer has no recourse except to provide it. The Court explained that thereafter the 2013 statutory changes "built off the 2004 legislation and established a new procedure, 'Independent Medical Review,' (IMR), to resolve workers' challenges to UR decisions."

Ms. Stevens challenged "the constitutionality of the IMR process." The arguments included violation of separation of powers, the state Constitution's requirements that workers' compensation decisions be subject to review and the system “accomplish substantial justice,” and principles of due process. The Court was not convinced of any of these grounds and concluded that California IMR is constitutional. 

As to the challenges related specifically to the California Constitution, the Court noted that "the Legislature has plenary powers over the workers' compensation system under article XIV, section 4 of the state Constitution." Furthermore, the Court concluded that IMR affords the injured worker with sufficient due process as guaranteed by the Fifth and Fourteenth Amendments to the U.S. Constitution. Essentially, the Court concluded that the ability to provide written arguments to the physician throughout the IMR process was sufficient. 

Ms. Stevens' July 2013 claim was for four medications and the provision of a home health aide following a work accident. Notably, this case discusses "compensability" as it relates to the claimed benefits, but there was no dispute regarding "the general proposition that Stevens suffers from pain and other ailments and is entitled to receive" medical care. The UR process involved review by "a board-certified anesthesiologist," who denied the requests in "an extensive, nine-page" decision, sent to Ms. Stevens. 

The Court's recitation of the grounds for denial focuses on the medical purpose and efficacy of the four medications (Ativan, Flexeril, diclofenac cream, and hydrocodone). The UR physician's conclusions and denial were essentially that other alternative treatments would be better, or at least should be tried before the claimed medication. Ms. Stevens disagreed and asked for a UR evaluation with "a different 'Physician Adviser,'” a re-review. Stevens was afforded and took "the opportunity to submit additional evidence for the (second) internal review." 

A second "board-certified anesthesiologist" reviewed the request for care. For it, Ms. Stevens submitted "a seven-page report by Dr. Jamasbi dated August 14, 2013, addressing" the first UR decision/denial. The second UR physician nonetheless also denied "the request for the four medications." That was similarly provided to Stevens in a written, nine-page report. This illustrates how the UR process affords the injured worker two opportunities to submit evidence, the initial UR and an "internal review" that involves a second physician and can include additional documents. 

On the basis of the second UR denial, Ms. Stevens sought an IMR. She was allowed to, and did, again submit additional medical documentation for the IMR review. Thus, there were a total of three opportunities to submit documentation. The IMR "final determination" was issued "in February 2014," and upheld the UR denial of home health aide and the four medications, based on the MTUS. 

The denial did not identify "the IMR physician," but stated "the IMR reviewer was “Board Certified in Pain Management, had a subspecialty in Disability Evaluation, was licensed to practice medicine in California, . . . had been in active clinical practice for more than five years, and was currently working at least 24 hours a week in active practice.” The IMR determination "became" the determination of the Director of the Division of Workers' Compensation (director) as a matter of law. (§§ 3206, 4610.6, subd. (g)). That legal function made the IMR decision "state action" for the purpose of the due process discussion and analysis. 

The injured worker appealed the IMR/Director's decision to the Workers' Compensation Board. The Board denied that appeal and affirmed the IMR/Director, noting Stevens had not proven "one or more of five grounds for appeal listed by the Legislature in section 4610.6(h) by clear and convincing evidence.” The Legislature provided specific reasons for which the IMR could be disregarded by the Board. As regards the "clear and convincing," there are those who find the California IMR similar to the Florida Expert Medical Adviser process in Section 440.13(9). 

The Appellate Court reiterated that the California Constitution "gives the Legislature 'plenary power ... to create ... and enforce a complete system of workers' compensation.'” The use of "plenary" suggests "absolute or unqualified" power. Some suggest that is a distinction relevant to Florida's consideration of IMR, as there is no similar Florida grant of "plenary" power, affording such unfettered authority regarding workers' compensation. 

Notably, in enacting the "IMR process," the California Legislature made specific findings as to the "then-existing system of resolving disputes about treatment requests." It concluded the process

"was 'costly, time consuming, and [did] not uniformly result in the provision of treatment that adhere[d] to the highest standards of evidence-based medicine, [and this] adversely affect[ed] the health and safety of workers injured in the course of employment.'” 

It reached similar conclusions regarding the pre-IMR process for the appointment of "qualified medical evaluators (QME) to examine patients and resolve treatment disputes. 

The Stevens Court stressed the independence of the IMR providers, the requirement of adherence to the MTUS, and the requirement for detailed decisions regarding requested reviews. The availability of appellate review by the Board, for specific grounds, also affords a level of due process according to the Court, although its power is limited to ordering a new IMR. And, ultimately, the decision can be reviewed "in the Court of Appeal" as in Stevens, but notably, the record may not include all of the documents involved in the various medical reviews. Each of these was found to include elements of due process. 

The Court concluded that "both workers and employers benefited from the 2004 and 2013 reforms." Primarily, the Court noted the speed and efficiency of decisions, the UR finality if in favor of the employee, and the reduced "insurance costs by creating uniform medical standards and reducing litigation." Thus, at least arguably, the benefit of "standards" is perhaps less about IMR than it is MTUS, UR, and perhaps the California pharmacy formulary. 

The Court concluded that Stevens' California Constitution challenges failed because of the plenary authority granted to the Legislature. That grant of power was intended to "remove all doubts as to the constitutionality of then-existing [workers'] compensation laws.” The Court concluded that the evolution of this "plenary power" clause "compels the conclusion that Section 4 supersedes the state Constitution's due process clause concerning legislation passed under the Legislature's plenary powers over the workers' compensation system. 

The Court was equally unmoved by the "principles of due process under the federal Constitution." It noted that "to prevail on a federal due process claim, plaintiffs must show that the state deprived them of a property or liberty interest without affording sufficient notice and opportunity to be heard." The Court expressed some doubt that such a decision as to the appropriateness of medical care either "constituted state action" or "implicated a protected property interest." 

It conceded that the due process issue is not settled by the United States Supreme Court, and discussed some similar factual medical necessity determinations in other cases, as well as some distinctions. In light of that uncertainty, the Stevens Court proceeded assuming that both "state action" and a "protected property interest" were present, so as to implicate the due process clause (of the Fourteenth Amendment by direct application, or potentially the Fifth Amendment subject to selective incorporation). 

The Court concluded that Ms. Stevens was "afforded ample process." It noted this included the IMR process, but more. It found the ability to submit documentation and written explanations through UR and IMR persuasive. And, the Court balanced the constraints (seemingly "confrontation" and "cross-examination" against a "governmental interest" previously determined to be "strong," as regards other medical decisions (in group health) IMR processes in California. It noted that ultimately, "the risks of erroneous deprivations under the workers' compensation system appear to be fewer, and certainly no more, than the risks under the" other California IMR process previously upheld. 

The Court specifically rejected the argument that due process was violated by the anonymity of the IMR physician. The physician is a "decision maker" and not an adversary. The Court found no legal protection for a party "to cross-examine such decision-makers." The person making an "initial decision" ("a clinician [that] determines that the treatment is medically unnecessary") might be subject to such examination, "to discover what that basis was." But, the Court explained, in California workers' compensation, patients "are given detailed explanations of the reasons for a denial" and "given multiple opportunities to submit evidence and challenge those decisions." 

The Stevens Court also rejected due process concerns centered on the limited nature of available appeals. First, it noted that whether the "due process clause" guarantees "any review" is unclear. There may be no constitutional right to appeal. Furthermore, the Court concluded that "the IMR process is itself a review." And, furthermore, it found efficacy in "the Board's authority to review an IMR determination," despite the statutory limitations. The real limitation on the patient, according to the Court, is "the MTUS." (There was no challenge to the MTUS or formulary in Stevens). 

Notably, one ground of the due process challenge was that the IMR statutory time limits are not subject to any "meaningful enforcement procedures." The process is intended to be completed within 30 days. However, the Court concluded that the failure of the IMR to comply with such a time constraint did not invalidate the IMR outcome. The 30-day limit is instructive, and directory, but not mandatory. That suggests that while IMR is intended to be more rapid, its promise may be illusory in some situations. 

Of note, the Florida Courts have repeatedly concluded that the time constraints upon Judges of Compensation Claims holding hearings and making decisions are similarly "directory," see AT&T Wireless v. Frazier, 871 So. 2d 939 (Fla 1st DCA 2004); Brown v. Pumpian, 504 So. 2d 481 (Fla. 1st DCA 1987). See also Miller v. Oolite Industries, Inc., 336 So. 2d 1152 (Fla.1976); Scottie-Craft Boat Corp. v. Smith, 336 So. 2d 1150 (Fla.1976). 

Stevens is not the last California word regarding due process concerns. In September 2018, the California Fourth District Court of Appeal rendered Barri v. Workers' Compensation Appeal Board, 28 Cal.App.5th 428 (Cal. Ct. App. 4th 2018). This is not an IMR analysis or decision, but it refers to Stevens in the context of due process. In Barri, the challenge instead involved a medical provider seeking payment (in California that is called a "lien"). The government cited Stevens and the "plenary power" in support of its actions. 

Though the Court ultimately concluded the government action was appropriate in Barri, it expressed reservations as to the extent of the "plenary power." It noted:

"The Legislature cannot carte blanche exercise its plenary powers and create legislation (1) unnecessary to the workers' compensation system or that (2) conflicts with the federal due process clause." 

Thus, while the concerns raised in Stevens and Barri were not found violative of due process, the Barri Court suggests that due process remains a factor to consider even in light of the "plenary" provision of California's Constitution. What that would require or preclude precisely remains unclear. However, there is the suggestion that "plenary" is perhaps not altogether unrestricted. 

Some now advocate Florida adopt the IMR process. Others will argue that California first instituted UR and the MTUS. Though Florida has heard debate of treatment guidelines over the past decade, neither such guidelines nor a medication formulary have been adopted (or some argue even seriously considered). IMR would ultimately be dependent upon the existence of each of these critical elements. California's course was to adopt those changes first, in 2004, followed by IMR eight years later, in 2012. Some will argue that if IMR is the goal ultimately adopted by the Florida legislature, a similarly sequential process would be appropriate or even necessary. 

There will likely be a debate on the importance of "plenary" authority. Some will find the presence of that language critical in the Stevens analysis. They may argue that without that authority, the IMR process fails to satisfy the other protections of the Florida Constitution. Notably, Florida does not have such a "plenary" power provision. Others may argue that the Stevens Court focus on Section 4610.6(h) occurred only because that section exists in California, but that the Court could have (or would have) reached the same decision if "plenary power" did not exist, merely upon other grounds. 

There will also likely be some discussion of the persuasiveness of Stevens as an appellate decision. Some will argue that this is not a decision of California's highest court. The California Supreme Court did not review it. The United States Supreme Court was asked to review but declined. Stevens v. California Workers' Compensation Appeals Board, 137 S.Ct. 384 (2016). Proponents of this argument may point to the many Florida District Court decisions that concluded attorney fee constraints in Section 440.34 were constitutional in the years leading up to the Florida Supreme Court decision to the contrary in Castellanos v. Next Door Company. 

In response, there will also likely be those who find the Castellanos argument unpersuasive. Some find that decision an unsupportable deviation from the standards of constitutional review. Arguably, the Castellanos Court did not address constitutionality following the expected precedential process, but inferred a "presumption" neither stated nor, they argue, appropriately demonstrated there. The Castellanos critics may perhaps argue that the dissent there was more persuasive and that a different result might well come from the Florida Court having a second chance in the future to review such a case. In that regard, the argument may be that the string of District Court cases were in fact correctly decided, and the Castellanos Supreme Court majority conclusion is atypical or aberrant, and therefore an erroneous, result.

Any or all of these arguments might be worthy of consideration or at least discussion. And, the arguments would likely require years of litigation and consideration. The constraint on Florida attorney fees passed in the 2003 reforms was litigated for years. The provisions of section 440.34 were again legislatively amended in 2009. The Supreme Court eventually decided Castellanos in 2016. Potentially, therefore, the next decade of Florida workers' compensation could be as interesting as the last, in the event that IMR is elected as the Legislature's chosen path. 

IMR in Florida?

Florida Tax Watch recently issued a report Keeping Workers' Compensation Premiums Low Through Independent Medical Review. It noted that in terms of workers' compensation insurance premiums, Florida is currently "33rd among the 50 states and District of Columbia," and notes the impact that recent court decisions could have on those premiums. It suggests that "the success of the IMR program in California" suggests that the program should be considered in Florida. 

The report notes that California has the highest premium in the country, at "$3.24 for every $100 of payroll," compared to Florida's rate of just over half that: "$1.66 for every $100 of payroll." It notes that "soaring drug prices are driving up health care costs," and cites specific examples of rising prices in recent years. And, overall, the report notes that costs are projected to continue to rise for all of "national health spending" over the near term. 

Last April WorkCompCentral published The Conundrum of Medical Inflation, which further supports that medical costs are increasing at rates well over inflation generally. Tax Watch reports that medical costs are significant in Florida, noting "only Louisiana, North Carolina, and Alaska have higher healthcare costs." There is also a reference to the "legal fees associated with workers' compensation claims," and to the 2017 OJCC Annual Report. For those who wish to review the latest, the 2018 OJCC Annual Report has also now been published. 

Tax Watch explains that the California Legislature sought to control system costs, and enacted Independent Medical Review (IMR) in 2012. This is a "non-judicial process" that resolves "disputes about the medical treatment of injured workers." It is tied to a separate but "related process" called Independent Bill Review (IBR). 

In the IMR process, a worker dissatisfied with care, or seeking different or more care, makes a request. That request is subjected to Utilization Review (UR). That process could result in the provision of the requested care, or the care could be denied. If denied, then the worker can request IMR. In that process, "professionals use principles of 'evidence-based' medicine to determine whether the requested care is medically necessary." The IMR process costs "are paid by employers." 

Tax Watch notes that the organization performing the IMRs, the "IMRO" "decided that the disputed service was medically necessary and appropriate 91.6 percent of the time" in 2016. It also notes that a significant majority of Reviews upheld the determination of the UR process (denial). Those two statements are difficult to reconcile. Notably, the California "Division of Workers' Compensation has also adopted an evidence-based drug formulary." That has been discussed in Florida, but no formulary has been adopted. 

Similarly, California has adopted, and recently updated, its Medical Treatment Utilization Schedule (MTUS). These are codified "treatment guidelines and rules for determining what is reasonable and necessary medical care." These determinations are "based on principles of evidence-based medicine." The California guidelines were developed by the American College of Occupational and Environmental Medicine (ACOEM). Thus, the UR process compares what is requested to the MTUS then, if a review is sought, the IMR compares the request to the MTUS. Both processes have objective criteria against which to measure a request. 

Tax Watch says that there would be considerable financial savings if Florida adopted IMR. It notes that IMR costs $345 to $390 to $515 each (depending on the claimed issues). It notes that the IMR resolution takes no more than 30 days, compared to the potential of 210 days afforded for OJCC trial in the Florida statutes. In 2018, the actual OJCC average time was 211 days to trial and an additional 15 days from trial to final order. 

Tax Watch says that at the $390.00 rate for IMR, the petitions litigated before the OJCC in 2016 would have cost $22.6 million. In 2016-17, however, the overall cost per petition in Florida was not $390, but $244 (2017-18 FLJCC Annual Report, P. 20). However, it emphasizes the savings in time (30 days to resolution), "PFB processing costs," and "a sizable reduction in attorney fees." It also sees the potential of "reducing or eliminating the Office (of Judges of Compensation Claims) or reassigning some or all of the 31 judges to hear other pending cases at the Division of Administrative Hearings." 

There are various topics intertwined in this proposal that bear discussion. First, Florida has not thus far shown any interest in either treatment guidelines or a formulary. The Tax Watch discussion seems to support that both UR and IMR, as they exist in California, are dependent upon the adoption of these standards. As I have heard about IMR from Californians, that is likewise the impression conveyed. The IMR could not viably process without standards. 

According to the National Institute of Health, Clinical Practice Guidelines "are systematically developed statements to assist practitioner and patient decisions about appropriate health care for specific clinical circumstances.” In other words, for a particular malady or diagnosis, there are pre-determined treatments that are deemed appropriate. The UR process relies on that consensus to decide if the requested care is appropriate. The IMR process likewise relies upon it. Is it possible that some of the California medical savings is based not upon UR/IMR, but upon the existence of published, clear, guidelines and formulary definitions as to what is or is not appropriate? 

If such guidelines were adopted in Florida, would that aid employers in making decisions about care, in a UR process? Would that "evidence-based" decision-making lead to fewer petitions being filed? Would the outcome of filed petitions before judges and mediators be more predictable? Would that "standard-based" process result in cost savings from less employer/carrier UR analysis, fewer petitions, and less litigation? If the guidelines produced that result, would a corresponding savings in attorney fees naturally follow, through resolution in the existing litigation system?

Similarly, would a list of medications that are covered in workers' compensation (a "formulary" according to Medicare) afford some objective standard for decisions regarding claims for medication? Would that "evidence-based" decision-making regarding medication likewise increase predictability and transparency, and perhaps expedite the resolution or adjudication of disputes?

Finally, there are two legal points worth mentioning. First, there are many disputes that would likely remain for adjudication. The term "compensability" as it is used in IMR would address whether a condition is or is not related to an event. However, it would not address whether or not the alleged event occurred. Those disputes would remain. Further, according to the 2017-18 OJCC Annual Report, over 30% of claims included a claim for temporary partial disability, slightly less sought temporary total, determination of the average weekly wage, permanent disability benefits, and other less frequent issues. Some systems for the resolution of those disputes would likely remain despite IMR. 

The second legal point mentioned by some is the "detached" or "impersonal" nature of IMR. There is no "hearing" in that process. Documents are submitted by the worker seeking care and by the employer. The IMR decision is based on those papers. There is no cross-examination or determination of credibility. There are those who see that as a due process issue, although there is precedent concluding that IMR affords sufficient due process. That legal analysis will be for another post. 

Nature v. Nurture

It seems that science is nowhere near ceasing to amaze us. A recent study by "a team of researchers at the University of British Columbia" has identified evidence of environmental effects being demonstrable in human DNA (deoxyribonucleic acid). DNA is not a new subject. The recent news has featured various instances of DNA providing leads in criminal cases. See Science, the Right to Privacy, and Big Brother (June 2018). But this recent news is not about using DNA to link a person to an event or another person. This is about human cells marking events, and perhaps potentially implicating descendants. 

In Child abuse leaves ‘molecular scars’ on victims, study finds, the Times of Israel reports that this British Columbia study involved a small group, 34 adult men. Of these, some "had been victims of child abuse years earlier." That included "varying levels of emotional, physical or sexual abuse." The scientists found alterations to the DNA, called methylation. According to news-medical.net, methylation is an "epigenetic signaling tool" that influences a variety of "cellular processes" in the body. When a particular DNA strand is "methylated, the result can be the inappropriate silencing of genes such as tumor suppression genes." 

The news-medical.net discussion suggests that methylation is "vital to healthy growth and development," and may protect against "potentially dangerous sequences of DNA" which are present in the person. This has been the subject of research regarding "cancer and tumor suppressor genes." Hypermethylation is hypothesized to potentially impede body response and thus could "lead to spread of cancer." Not being a scientist, this leads me to conclude methylation is a normal and necessary process, and when it goes too far, that poses a risk to the body. 

In the British Columbia study, researchers found that "effects of the trauma were indelibly printed in 12 regions of the DNA." The normal methylation process produced evidence or indicia. Men who "had experienced varying levels of emotional, physical or sexual abuse" retained evidence of that experience on their DNA. The article explains that genes might be thought of similarly to light bulbs, and the methylation "controls how strong each light is." The researchers see this indicia of prior experiences as potentially aiding "investigators or courts to weigh allegations of child abuse." This is intriguing, that events, emotions, and traumas can leave evidence on the very building blocks of our person. 

The study concludes that genes are not "entirely pre-programmed from conception." Instead, the contention is that some are "activated or deactivated by environmental factors or an individual’s life experience" ("varying levels of emotional, physical or sexual abuse"). This suggests that emotional reactions to our environment may be evidenced by the appearance of our individual DNA. 

Certainly, that is the focus of this current study on abuse victims. However, it is DNA evidence of the influence of the environment. There has long been a "debate within psychology" regarding the "extent to which particular aspects of behavior are a product of either inherited (i.e. genetic) or acquired (i.e. learned) characteristics. See Nature vs. Nurture in Psychology. Thus, the potential to corroborate environmental (emotional or physical) events is reasonably noteworthy. This may be in support of "what" we each are, but also potentially "why" we are as we are. Researchers see potential for "the development of tests that could be used by healthcare workers or potentially even as forensic evidence.”

The implications in criminal law and psychology generally are easy enough to envision. However, how could this be implicated in the cause-and-effect disputes that so permeate fields like personal injury litigation and workers' compensation? The ability to document from DNA when some emotional or physical event(s) occurred could potentially influence the determinations of causation of either physical or emotional complaints. Is it possible that determining the onset of psychological complaints could be substantiated or challenged with accuracy using this methodology? Is it possible that a person's DNA might support the existence of emotional distress, for which damages are sought?

And, there is a suggestion that the presence of these effects in DNA perhaps means that environmental events occurring in one generation might be passed to another. In the field of personal injury litigation, could that potentially result in damages being sought both on behalf of a person who suffered an event, but also some other set of damages sought on behalf of a descendant? There are a multitude of questions that are raised. For example how long might such a process involve (imagine a young child experiencing an environmental trauma and then reproducing perhaps 15 years or more in the future, passing that DNA methylation to another generation). And, what are the implications for lasting transfer, might that child's child (grandchild of the person who experienced the event) also receive and maintain that altered DNA, albeit in some combination with other inherited effects?

For now, this research is limited to male subjects. The hypothesis is that similar changes will also eventually be identified and documented in females. The Times reports that testing will have additional hurdles and thus costs associated. Therefore, it may be this line of scientific inquiry proceeds only with male studies in the near term. 

It is certainly too soon to predict where this might lead. One source quoted by the Times of Israel concludes that "it is possible that epigenetic changes in sperm cells play a role in the physical and mental health of the next generation." It is possible that the debate of nature v. nurture is not as clear-cut as was once believed. It is possible that some of your nature is the result of your parent's or perhaps other ancestor's nurture, or lack of it. These are intriguing times indeed. 

Texting and other Distracted Driving

Technology is changing the world around us. Another example came up last June as reported by Fox in She says she was just checking her Apple Watch. This is interesting as various states have passed legislation aimed at distracted driving. Florida has a law but is considering changes yet again. Senate Bill 76 (SB76) has been filed for the 2019 session according to the Tampa Bay Times. A recent opinion piece in the Times refers to current law as a "blunder." Safety is an overall societal concern, but motor vehicle accidents are a leading cause of workplace injury (in case you were tempted to ask "What does this have to do with workers' compensation?"). 

Currently, Florida prohibits texting while driving in section 316.305, Fla. Stat. But, that provision is specific to texting and is limited to a "secondary action," meaning that a driver can only be ticketed for this if they are stopped by an officer for some other reason. The proposal in the language of SB76 removes specific references to "texting" and "text messaging" in favor of broader prohibition on "using a wireless communications device" and "listening or talking on such a device . . . for the purpose of nonvoice or voice interpersonal communication." The limitation to secondary offense would also be removed by this bill. 

SB76 would thus preclude making or receiving telephone calls while operating a motor vehicle; it says a person cannot operate a motor vehicle "while sending or reading data or listening or talking on such a device for the purpose of nonvoice of voice interpersonal communication." This bill specifically authorizes law enforcement to stop a driver "using a wireless communications device while driving." That is a reasonably broad prohibition. 

However, there is a specific list of exceptions already in section 316.305 regarding "texting," which would remain even if "texting" is expanded as SB76 seeks. Law enforcement, fire, and medical services professionals may use their mobile devices. Anyone may use their device for "reporting an emergency," or for "navigation" or "radio broadcasts," or to receive messages that are "safety related . . . traffic, or weather alerts." 

And, there is a clarifying sentence that "a motor vehicle that is stationary is not being operated and is not subject to the prohibition in this paragraph. Thus, it would appear that interacting with your mobile device at a stop light would not be a violation. Furthermore, as the age of The Jetsons approaches ever more rapidly, the law "does apply to a motor vehicle operator who is operating an autonomous vehicle, as defined in section 316.003, in autonomous mode" (and no, that does not include merely "driver assistance systems"). 

Shortly after SB76 was filed, House Bill 45 (HB45) was filed. It also addresses section 316.305, Fla. Stat. and distracted driving. It likewise is focused on "using a wireless communications device," rather than "texting" specifically. This amendment would forbid "holding or otherwise touching" such a device while operating a motor vehicle. In the list of specific exclusions (this "does not apply") would be added "communication through the use of a hands-free device." HB45 similarly removes the "secondary action," limitation. Thus, either bill would make mobile device use a "primary offense."

An interesting element of HB45 would require police agencies to track the race of those ticketed for "holding or touching a wireless communications device." That data would be compiled in a report annually to the "Governor, the President of the Senate, and the Speaker of the House."

Last summer, a Canadian driver was stopped at a red light. A police officer "noticed a 'glow' in her car from an electronic device," and observed the driver to "glance up and down about four times." The driver was also "slow to start moving when the light turned green." The officer testified that "he had to shine a light to get her to go, at which point he pulled her over and ticketed her." The British Broadcasting Company (BBC) also reported on this. 

The driver's defense was that she was merely "checking the time." The court interpreted "Ontario's anti-distracted-driving law, which bans driving 'while holding or using a handheld wireless communication device.'" And, the driver was fined $400.00 by the court, despite the driver's argument that her "Apple Watch shouldn't be considered a handheld device." The Judge, according to the BBC, said "smartwatches were a distraction as much as a 'cellphone taped to someone's wrist.'" In a similar story, 9to5Mac reports a Canadian was fined for changing music on an Apple watch. 

In a California case, Benchmarks reports that a judge fined a driver who took a call on his cell phone while stopped at a traffic light. The foundation for an appellate court upholding that decision was that "driving" "encompassed a 'fleeting pause' at a traffic light." There is language in the interpretation focused upon the car being in gear, held in place only by the brake. The suggestion being that shifting into "park" might change the outcome. What would be the impact of cars at traffic lights habitually shifting into "park" so a device could be checked? 

Back to Canada, Fox, BBC and others note studies that "various studies" support that "hands-free devices in general (are) not safer than handheld devices while driving." Furthermore, there are studies that "smartwatches in particular slow down driver response time." According to the National Safety Council, "at any moment, 7% of drivers are using cell phones." And, "drivers looking out the windshield can miss seeing up to 50% of what's around them when talking on any kind of cell phone." However, somehow talking to a passenger in your car is not "just as distracting." 

But, of course, none of us are guilty, right? In 2017, the Sun-Sentinel reported that as many as "92 percent of drivers nationwide with cell phones have used them while in a moving car." The study that reached that conclusion also said that generally "Florida ranks second only to Louisiana for distracted driving." That could be more than phones though. 

There are those who reportedly shave while they drive. There is some evidence to link eating and drinking to distraction, as well as smoking. How about reading a book, or putting on makeup? But notably, Safestart ranks the number one distraction as being "lost in thought." That is somewhat troubling, as it attributes that in 62% of the distracted events, and "cellphone use" in only 12% (number 2 on the list), to perhaps 14% (because another listed category is "reaching for a device"). No plans have been found to allow primary ticketing for that vast population driving while "lost in thought." 

There is also some suggestion that distractions affect us all, not just those who are not emergency responders. One officer claims "distracted driving is just as serious and problematic among police officers as it is among civilians." But, the law seems inclined to exempt all such distractions for "law enforcement" and others regardless of whether such use is "necessary," or "emergency," or even work-related. The exception of Section 316.305 seems to apply to "law enforcement" and others in the broadest context. But officers do cause accidents while distracted, according to NBC 13, WAVE3 News, and NBC5. 

So, where would SB76 or HB45 bring Florida? The National Conference of State Legislators says that only 16 states "prohibit all drivers from using hand-held cell phones while driving." However, 47 states and four territories have banned text messaging for all drivers. That website has a chart illustrating what is banned where, and which states have designated primary versus secondary offenses. There is discussion in the Times' recent opinion piece referencing the risk of "novice drivers." But, really, if distraction is a problem is it more or less so based on experience? The reports of police causing accidents due to distraction seem to suggest the problem exists despite experience? 

Returning then to the Apple Watch, the question may be whether it is or is not a "handheld." It may be that the answer to that is no different than analyzing the use of a phone, it depends. Not on the device, but on the purpose for which it is being used. Could a motorist be ticketed for "touching" his or her watch under the proposed Florida legislation? Will distinctions of movement, "stopped" or in "park" make a difference? At the end of the analysis, will there be fewer accidents and injuries with a change in the law?

Drugs and Work

A couple of recent news stories brought my mind back to the potential issues that will continue to draw attention in an evolving ever-friendlier American drug environment. The people who keep track of injuries tell us that the predominant causes of workplace injuries include "falls to lower level" (#4) and "roadway incidents involving motorized land vehicles" (#6). The two stories involved these common workplace challenges. 

From Nebraska comes a decision on imputed relationships and responsibility: Supreme Court Rejects Suit Against Contractor for Fatal Accident by Drug-Using Trucker. WorkCompCentral reports that the Nebraska Supreme Court was asked to analyze the employment relationship, independent contractors, and statutory employers. That worker and employer relationships can be complex is nothing new. 

Factually, Lyle Carman was a truck driver. He decided to drive a dump truck while "under the influence of amphetamine and methamphetamine." Anyone who has driven a large truck will likely tell you that they are no picnic to drive under the best of conditions. Thankfully the dump truck was empty when Mr. Carman drove it into another vehicle (#6), causing his victims to "tumble end over end into a ditch." 

The 23-year-old driver of the other vehicle was killed. Her husband and infant daughter were injured. The survivors sued Carman. the owner of the trucking company which owned the vehicle (Lopez), and Werner Construction. "Werner had hired Lopez Trucking to haul debris." The survivors claimed that Werner was the "general contractor" and as such was a "statutory employer" and thus responsible for the actions of Carman. 

The Nebraska Supreme Court concluded that Werner lacked control over the way in which Lopez Trucking performed the debris removal it was hired to perform. The Court noted that Werner did not direct the performance or tasks for Lopez and thus for Carman. Therefore, Werner was dismissed from the lawsuit. Control was critical to the analysis of "employee" versus "contractor." 

The second article, also from WorkCompCentral was Worker Failed to Prove Discipline for Positive Drug Test Was Pretext for Discrimination. This describes a case from New Jersey. It involves an employee, Mr. Baker, who "fell down a flight of stairs" (#4). Mr. Baker was treated for his work injury and returned to work almost a year later. 

Mr. Baker felt inappropriately treated upon returning to work. He alleged that the company discriminated against him, including comments about the cause of his accident, allegations of drug addiction, and denial of a requested transfer to avoid particular coworkers. The month before he had returned to work, Baker was informed he had been selected for a random drug test, which was actually performed the month after he returned. That test was positive for amphetamine. 

Mr. Baker was therefore suspended for five months. He sued the employer alleging discrimination and retaliation. However, in his testimony, he admitted "he did not believe his suspension had anything to do with his injury or any perceived disability." 

The commonality of these stories is obviously amphetamines. Amphetamines are stimulants, sometimes prescribed for attention deficit disorder, narcolepsy, and even obesity according to drugs.com. Methamphetamine is similarly a stimulant but produced for illicit use, according to the NIH. The first story illustrates how an employer, like Lopez Trucking and whomever else might be implicated by proof of "control," can be held responsible for events that occur when its employees are under the influence. The second story illustrates that when an employer seeks to enforce policies to prevent such use, they can be sued by the employees who are tested or disciplined. 

Thus, an employer can be liable if drug use occurs by those in its control, and can be sued for attempting to prevent drug use by those employees. This puts employers in a difficult situation. It could put someone hiring an employer (like Werner) in a difficult and expensive situation. Drug use in the workplace is a reality, but how widespread? As the American public witnesses the use of prescribed, recommended (marijuana is not prescribed), and illicit drugs in the workplace, how will that affect the working relationship overall? How will the cost of resulting accidents be socialized in the costs we all pay for goods and services? 

It is a curiosity. With the loosening enforcement on various substances, reports of increased use of methamphetamine, and the challenges of imported substances like Fentanyl, it is a subject that will likely remain prevalent in the news. It is also a probable topic in workers' compensation hearing rooms and appellate courts.

The Appointments Clause

WorkCompCentral reported on September 10, 2018, that "Trump Order Makes ALJ Appointments More Political." The article refers to the Executive Order Excepting Administrative Law Judges from the Competitive Service, which references Lucia v. Securities and Exchange Commission, No. 17-130 (June 21, 2018), a decision of the Supreme Court of the United States (SCOTUS). It is an intriguing topic regarding the employment of Administrative Law Judges (ALJ) by the Federal government. This has implications for any administrative judge perhaps, depending upon whatever state constitution or statute authorizes such appointment. 

The matter was instigated when the Securities Exchange Commission (SEC) charged Mr. Lucia with some security law violations. The SEC assigned the matter to an ALJ who thereafter concluded Mr. Lucia "had violated the law." The ALJ therefore imposed sanctions. Mr. Lucia appealed citing the "Appointments Clause" of the United States Constitution regarding Presidential powers:

. . . and he shall nominate, and by and with the Advice and Consent of the Senate, shall appoint Ambassadors, other public Ministers and Consuls, Judges of the supreme Court, and all other Officers of the United States, whose Appointments are not herein otherwise provided for, and which shall be established by Law: but the Congress may by Law vest the Appointment of such inferior Officers, as they think proper, in the President alone, in the Courts of Law, or in the Heads of Departments.

Mr. Lucia contended that agency ALJs are "Officers of the United States," and as the ALJ assigned to his case had not been appointed by either the President, "the Courts of Law" or the "Heads of Departments," that his appointment was invalid. A panel of The Circuit Court for the District of Columbia held that SEC ALJs are not "Officers of the United States." When the whole Circuit Court heard the case ("rehearing en banc), it split evenly on the question, thus leaving the panel decision intact. That itself is interesting in understanding the dynamic of appellate decision processes. 

The Lucia case has an intriguing procedural element also. The SEC was defended before the Circuit Court by the U.S. Department of Justice, which agreed that the ALJ was an employee, not an Officer. However, when Mr. Lucia petitioned the SCOTUS, the "Government switched sides," leaving the SEC on its own. The SEC is a federal agency that has 4,527 employees; it is not the Social Security Administration (61,062 employees) or Veteran's Affairs (378,319), but the SEC hardly seems defenseless. However, the SCOTUS "appointed an amicus curiae (friend of the court) to defend the SEC's "employee" contention. The SCOTUS noted that "the only way to defeat" Mr. Lucia's argument would be to "show that those ALJs are not officers at all, but instead non-officer employees," or "lesser functionaries."

The SCOTUS reversed the Circuit Court for the District of Columbia, concluding that ALJs are "Officers of the United States." It was not a unanimous decision, with six Justices joining the majority, a seventh concurring in the result, but dissenting in part, and two dissenting outright. The SCOTUS conclusion was founded on previously concluding that "special trial judges" of the U.S. Tax Court were "Officers," essentially because they serve on an ongoing basis, their appointment is "specified in the Tax Code," and though they "cannot enter a final decision," they exercise significant duties and possess significant discretion. The SCOTUS attached some significance to the ALJ appointment being a "career appointment." 

In the midst of that litigation, the SEC issued an order ratifying its appointment of existing ALJs. To "put to rest any claim" regarding the appointments clause, the SEC, the "Commission - in its capacity as head of a department - hereby ratifies the agency's prior appointment of" a Chief ALJ and four other ALJs by name. Thus, as the litigation proceeded regarding "employee v. officer," the agency appointed those ALJs again under the Appointments Clause, removing any potential for future issues in a case such as Lucia's, at least with SEC ALJs. 

The June 2018 executive order mentioned above then followed the SCOTUS decision. It recognized that the government "benefits from a professional cadre of administrative law judges (ALJs)." It echoes the finding of "significant duties" and "significant discretion" made by the SCOTUS. It therefore concludes, more broadly than the SEC-focused decision in Lucia, that "at least some ‑‑ and perhaps all ‑‑ ALJs are 'Officers of the United States' and thus subject to the Constitution’s Appointments Clause. 

Based thereon, the President of the United States (POTUS) concluded that the hiring of ALJs should be "an exception to the competitive hiring rules and examinations for the position of ALJ." Thus, affording agencies with greater discretion in the appointment of these career positions. 

This action was to "reduce the likelihood of successful Appointments Clause challenges, and forestall litigation in which such concerns have been or might be raised." There are those who see this conclusion as politicizing the appointment process, as the WCC headline alludes. 

The Executive Order changes appointment and retention for ALJs in a variety of federal departments. Arguably, that change could make the process more political than it has heretofore been. However, the change was mandated to the SEC by the SCOTUS, not by any Executive Order. And, that decision by the SCOTUS was essentially an adoption of the Court's decision in Freytag v. Commissioner, 501 U. S. 868 (1991) regarding arguably similar Tax Court "special trial judges." Further, Freytag and thus Lucia, are founded upon the Court's decision in Buckley v. Valeo, 424 U. S. 1, 126, n. 162 (1976). Some would argue that the foundation for future challenges to agency ALJs under the Appointments Clause are therefore both possible and perhaps probable absent Executive recognition of and compliance with Lucia. 

As such, it is practical to believe that similar challenges regarding the appointment process of other agency ALJs might well have reached the same destination as Lucia, albeit after a similar delay. It is notable that Mr. Lucia was charged in 2012. The decision of the SCOTUS came six years later. And, the result of the SCOTUS decision is that the case against him must now be retried by another ALJ (The SCOTUS concluded that the "head of the department" ratification order from the SEC could not "cure" the ALJ's impaired position under the Appointments Clause at the time of his trial decision). 

Also of note, one of the dissenting SCOTUS Justices agreed with the Court's conclusion that the ALJ appointment by the SEC was improper. His disagreement lay in the reasoning, which he contends could instead be reconciled by statute, rather than resorting to "constitutional grounds." As such, the majority on the issue of improper appointment in this setting was in fact seven of the nine justices. 

The two dissenting Justices disagreed with the SCOTUS conclusion of what constitutes an Officer and proposed a more restrictive "significant authority" test than that applied by the majority. In so doing, the dissent asserted that (1) "this Court’s Appointments Clause jurisprudence offers little guidance on who qualifies as an 'Officer of the United States,'" and that therefore (2) "[Q]uestions about the Clause continue to arise regularly both in the operation of the Executive Branch and in the proposed legislation.” There seems consensus that clarity regarding the Appointments Clause would be beneficial, while there remain perhaps differing opinions as to what that clarity should be precisely. Whether one agrees with the Executive order, it does bring that clarity. 

Both Lucia and the Executive Order perhaps will guide appointments, and avoid the litigation and debate that "arise regularly?" In that vein, the decision likewise addresses the concerns about Executive Branch operation and litigation. Some may argue that the more accurate assessment of the situation is that the Constitution (Appointments Clause) makes ALJ appointments more political. In the end, the Constitution contains constraints and requirements, the highest court in the country has provided its considered interpretation, and the chief executive has effectuated that judicial interpretation. 

That does not mean that critics cannot criticize (Taylor Swift might contend they most certainly will "haters gotta hate," but would that be banal?) It does mean that the change in federal ALJ appointment brings clarity, will decrease litigation and debate, and thus increase predictability and finality regarding ALJ decisions in similar settings. In all, the Lucia decision is instructive and productive, and the Executive Order is appropriate.

The Sunk Cost Fallacy

Recently, workers' compensation prognosticator Peter Rousmaniere published The New Democratic House Likely to Confront Work Comp. He contends that workers' compensation will soon be "under the most intense Congressional scrutiny in decades." That conclusion is predicated in some part by the October 20, 2015 letter penned by "ten Democrats" who "showed their irritation" with the overall workers' compensation concept. They expressed that they were “concerned about a pattern of detrimental changes to state Workers' Compensation laws and the resulting cost shift to public programs like Social Security disability…”

Note that this argument is of a shifting of cost from a system financed by employer insurance premiums to a system financed by employer and employee-paid taxes. Or, it could mean shifting of cost to health insurance, which some contend is majorly subsidized by employers. In any event, the "costs" are likely to be monetized and whether the expense is a payroll tax or insurance premium, it will be passed to the consumer in the price of goods and services. Or, contrarily, when no treatment is provided, the cost is shifted first to the worker, and then to the economy in general through diminished productivity.

Mr. Rousmaniere reminded of the 2015 correspondents' reference to "a 2015 study by OSHA," concluding that workers' compensation costs are allegedly not borne by American industry: Adding Inequality to Injury: The Cost of Failing to Protect Workers on the Job. The correspondents assert that this report concludes “employers now cover only about 20% of the overall cost of a workplace injury. Furthermore, that "the workers themselves, their families, (with) their private health insurance covering nearly 63% of the cost and tax payer-supported safety net programs covering the remaining (approximately 17%).” He further cites research by ProPublica and a series of articles it produced in 2015 (to both acclaim and criticism). 

The fallacy here is that any cost is borne by employers. All costs incurred by employers are passed to their customers (us) in the prices we pay. Costs incurred by employees, not covered by an employer, are generally passed to taxpayers (us) in the taxes we pay. 

The 2015 OSHA Report concedes that after 35 years of concerted effort, OSHA has come nowhere near enforcing its mandates regarding documenting work injuries. It notes "that many, and perhaps the majority, of work-related injuries are not recorded by employers." Of course, the enforcement for monitoring such recordation is OSHA and its 2,100 inspectors. It is notable that the Office of Personnel Management lists OSHA with only 1,876 total employees. In 2019, OSHA's budget is projected at approximately $549 million (about $261,429 per employee at 2,100). 

OSHA is pointing fingers at state laws, and concluding they are either inefficient or ineffective (20%). In publishing its conclusions regarding what is being reported and being paid, it is refreshing for a bureaucracy to note its own shortcomings. According to the OSHA Factbook, those 2,100 inspectors conducted 39,000 inspections in 2007, or about 19 inspections per inspector. OSHA's goal for 2019 is to conduct fewer inspections, but with more employees, according to Safety and Health Magazine. Nineteen inspections per inspector per year, or one about every three weeks. 

The Factbook also notes that in those 39,000 inspections, "two-thirds of work sites were not in compliance with OSHA standards," and that "this demonstrates the success of OSHA’s programs which focus on employers and employees with the most injuries, illnesses, and fatalities." Read that again, that 2/3 of worksites are not in compliance "demonstrates success." The Factbook also notes that there are "over 8 million work sites . . . nationwide." If two-thirds of those work sites are not OSHA compliant (consistent with the findings in 2007 of the extremely small sample of sites that were actually visited), that means potentially about 5.3 million non-compliant work sites. Some will argue this does not "demonstrate success."

It is worthy of note that "over" and "under" inclusion, the phantom of "cost shifting" is often raised in workers' compensation. There are those who believe the industry is avoiding responsibility for a population of injuries appropriately attributable to the workplace ("under"). There are also those who believe that industry is, at least at times, burdened with injuries that are not demonstrably attributed to work ("over"). The truth of the matter may be that determining injury causation, absent some clear trauma like a fall or collision, may devolve to some choosing between competing expert opinions. That may be true in a particular dispute or in a broader category of particular maladies or injuries. It is possible that those decisions are not entirely objective or even capable of being so. 

There is also a suggestion that costs are shifted to workers' compensation indirectly. For example, Why Does Surgery Cost Double in Workers' Compensation? (April 2014). There is evidence in the statistics to support a conclusion that financial reimbursement rates for procedures have the potential to drive conclusions about whether a particular malady is or is not work-related. See Cost Shifting Evolves into Case Shifting? (April 2016). That is to say that individual financial incentives in particular instances may drive the inclusion analysis. And if that is real, could it be that finances drive inclusion analysis overall? Some have suggested that system dysfunction and conflict fuel the demand for expertise and effort, thus some population both embraces and desire system dysfunction. 

At the end of the day one truism has to be faced. Injury and illness are bad. They both hurt, diminish function, and affect performance. I am not saying people cannot learn to deal with pain, overcome impairment and dysfunction, or otherwise persevere. We have all seen examples of inspirational people who do all of those things. But, that they persevere and succeed neither means that it was easy, painless, or quick. We must applaud their achievement but also recognize the price they have paid. When all is said and done, when an injury occurs, Someone Has to Pay. Unfortunately, there is a population that does not achieve the functional restoration that inspires us in some. 

And on the subject, the concept of "payment" deserves some explanation. When we discuss the "real" cost of work injuries, we have to remember that "paying" may mean an economic exchange where money and goods or services change hands. But, paying may also include that residual bodily dysfunction, that pain, that disability. While workers' compensation focuses on how those affect the ability to work, it ignores that these all impact the human being more broadly, 24/7/365. That is true whether a work injury impacts personal life or a personal injury impacts professional life.

As I contemplated Mr. Rousmaniere's contention regarding involving the feds in workers' compensation, I also happened across an intriguing British Broadcasting Company (BBC) article: Whatever Happened to Berlin's Deserted Ghost Airport? See, when the Berlin Wall fell in 1989, the leaders there concluded a new airport was to replace the two (one east and one west) existing airports. They planned, financed, and began construction with their eyes on opening in 2012 at a total cost of about €2 billion (€ means euro, the currency of the European Union). That would be about $2.25 billion (according to The Currency Converter).

Well, 2012 came and went. In 2018, the current estimate is that €7.3 billion will be spent before it opens, maybe eight years overdue in 2020. One airline executive was quoted predicting the terminal will never open. He contends that it will yet be torn down and begun anew. That is eight years behind schedule and over three and one-half times the estimated cost. Notably, the project has been managed by a government corporation, a "committee," rather than a "general contractor." The "committee" decided on this construction model "despite not having experience with an undertaking of that scale." A project on a scale it had never attempted, and "staffed with politicians."

The airport stands empty in late 2018. It is a punchline of sorts. Officials there recently replaced all "750 of the monitors showing flight information." Despite there having never been any flights, no one turned these off, and they simply wore out. For years, this equipment has drawn electricity, and heated circuits, and accomplished nothing in the vacant halls and galleries. The replacement cost was about €500,000. In addition, "4,000 doors were wrongly numbered; escalators were too short." The design of the terminal also did not allow for enough "check-in desks" for passengers. 

Astoundingly, as of now, "approximately 300 to 500 people work regularly in the main terminal building," but no planes ever come or go. It is a mind-boggling mess. This is a bureaucracy functioning for its own interest, accomplishing nothing beyond the consumption of resources. 

As an aside, one wonders if Europeans have been forced to do online flight check-in like we have, complete with cell phone-based boarding passes? I was recently in an airport and noticed the "check-in desks" seem a bit underused perhaps. While they diligently work to enlarge the new airport's check-in facilities, one wonders if they are answering an ever-decreasing problem or need. Are they fixing today's and tomorrow's issues or addressing yesterday's? Perhaps there is a government sub-committee for setting priorities? 

An "airport committee spokesman" faulted the decision to "push forward with fixing" problems, suggesting instead that managers should have decided in 2012 to "totally gut the building and dismantle all the complicated facilities.” the spokesman contends that solution would have been faster and cheaper. The BBC questions whether the airport is a victim of the "sunk cost fallacy." 

If you are in the sales or marketing game, you may have been trained on the "sunk cost fallacy." The more a buyer becomes invested in a purchase or the purchase process, the more likely they will stick around to close the sale. This is because the alternative is going to the next vendor and starting that acquisition cost expenditure (time, money, or both) all over with new issues, questions, and more. There are some who masterfully use this process, driving the investment of time and energy. In the end, a fair amount of sales are accomplished by exhausting the target, uh, I mean customer. 

The BBC notes that there is a value in speed and responsiveness. There seems to be some sentiment that the efforts toward opening have been sincere. However, it cites that over the course of the many delays, additional faults have come to light. Furthermore, as a political entity, that project leadership "has changed hands nearly as many times as the opening date has been pushed back." With every leadership change can come the shifting of priorities, the challenge of driving home long and short-term needs, and the seemingly endless process of describing and documenting both mission and approach.  

And all of that might leave the reader lost (I can see the comments now "What does this have to do with workers' compensation? No worries, I hear that sometimes from even seemingly engaged industry people). I would suggest that the "sunk cost fallacy" might be a point of consideration if the federal government elects to wade into the complexity that is American workers' compensation. It might bear consideration even without the feds, as states consider workers' compensation. Certainly, there has been extensive effort and money invested in these various systems, state and federal. Over the decades, more than one band-aid has been applied here and there. But, if this "facility" that is workers' compensation is not functioning optimally, is another band-aid (or box of them) the answer?

Certainly, there are emotional and intellectual ties that bind us to a particular program, approach, or organization. But, if it is time to look at workers' compensation from a broad and national perspective, it might be appropriate for that examination to include the potential of bulldozing this terminal and starting over. And while they are at it, perhaps the OSHA terminal is due for a similar evaluation based upon its demonstrated success with only an extremely small sampling of American workplaces despite its significant budget? 

Perhaps it is time for some hard conversations about socialism, regulation, compensation, causation, compromise, recovery, residual function, ability, disability, impairment, remediation, cure, and more? Perhaps it is time to consider not where we are, or even where we have been, but to return to an analysis of what is right for all (pronounced "both," as there are only two real parties to workers' compensation, the employer and the employee) involved. 

That is not to say that federalization is the answer. The spectacular under-performance that is OSHA, with its average of 19 workplace visits per inspector per year, more than demonstrates the potential that a national, federal system or process can be as inefficient and ineffective as any other entity. The stories we are provided about the Veteran's Administration are equally cautionary. Bigger and more centralized have certainly not proven to be incontrovertible successes. But, perhaps if there are to be standards or even recommendations from a broad perspective, it is time to start with a clean slate, discuss the challenges of injury and illness, and formulate some core conclusions about work, employers, employees, and the reality of injury and illness. 

All that said, it is doubtful to many that meaningful change is on the horizon in Washington. Our national workers' compensation consensus seems confident that special interests and narrow foci will persevere and prevail, and that band-aids will be the chosen course. There is a perception that many parties engage in the regulatory and legislative processes in the spirit of the sunk cost paradigm, striving to exhaust their opponents into capitulation. In that regard, perhaps workers' compensation is as mainstream as any other American regulatory process?