Eye Of The Storm
May 4, 2016


This week the Florida Supreme Court issued a ruling in Castellanos v. Next Door Company.  At stake was the state's mandatory attorney's fee schedule for workers' compensation claims.  The high court held the attorney's fee schedule to be unconstitutional under the Florida and the U.S. Constitutions as a violation of due process.  Castellanos is one of several cases before the Florida Supreme Court challenging provisions of the Florida Workers' Compensation Act.

$1.53 PER HOUR?

The claimant, Castellanos, and his attorney alleged that the state's system of awarding fees at a rate of 20% of the benefits secured was unconstitutional.  A 2009 WC reform created an "irrebuttable presumption" that attorney's fees calculated under the state's fee schedule were reasonable and irrefutable.  Fees calculated under the schedule in Castellanos resulted in a rate of $1.53 per hour for the 107.2 hours of attorney work needed to secure an $800 benefit for the injured worker.  The court struck the provision and remanded the case for a determination of a reasonable fee for the attorney's work.


In the near term, we expect applicant's attorneys to file fee petitions on open or recently resolved claims for fees in excess of the attorney fee schedule.  Over a slightly longer forecast, the rating bureau, NCCI, is planning to submit an off-cycle rate filing next month for review and consideration by the Florida Office of Insurance Regulation based on this ruling.  While the ruling will cause some tumult, the court did not scuttle the state's WC system.  In fact, the court this week issued a one-page order dismissing Stahl v. Hialeah Hospital, a case that challenged the very constitutionality of the state's entire workers' compensation system.  We continue to monitor conditions in Florida.



The 2016 Atlantic hurricane season is one month away.  Experts are predicting severe weather in the Atlantic.  Up the coast, the U.S. House of Representatives unanimously voted (419-0) this week to passlegislation (H.R. 2901) that would allow lenders to accept private flood insurance solutions from private insurers and qualified surplus line insurers to satisfy requirements for mortgages.  


The flood bill moves to the Senate, where support is already cresting.  Outside the Beltway, support for H.R. 2901 and applause for the House's swift passage has been surging from insurance carriersrealtors, and state insurance commissioners around the country.  Incidentally, the Florida Financial Services Commission this week appointed David Altmaier as Florida's new Insurance Commissioner.  



The White House Office of Management and Budget (OMB) completed its review of OSHA's proposed electronic injury reporting rule, which aims to improve workplace safety through "establishment-specific" injury and illness data.  With the information acquired through this proposed rule, employers, employees, employee representatives, the government, and researchers will be better able to identify and abate workplace hazards.  OSHA first proposed the electronic reporting rule in November 2013 and the regulation has been working its way through the notice and comment process and should be published in the Federal Register in short order.



The U.S. Department of Labor's Office of Workers' Compensation Programs issued a final rule to strengthen safeguards for the health of coal workers. The rule makes significant revisions to the regulations implementing the Black Lung Benefits Act that will give miners greater access to their health information, bolster the accuracy of claims decisions, and require coal mine companies to pay all disability or survivor's benefits due in a claim before challenging an award.


Governor Peter Shumlin signed legislation to strengthen Vermont's captive insurance environment by refining captive governance standards, expanding dormancy rules and captive cells (segments of the captive's capitalization) to be transferred, sold, assigned or converted.  The legislation sends a "strong message" to the industry that the Green Mountain State is committed to "constant improvement to the state's captive insurance laws,"  according to David Provost, Deputy Commissioner of Vermont's Captive Division.  



The Ohio Bureau of Workers' Compensation proposed a first-of-its-kind opioid prescribing rule to support the health and safety of Ohio's injured workers. Under the proposed rule, reimbursement for opioid prescriptions would be limited to claims where current best medical practices, which have been developed by Governor Kasich's Cabinet Opioid Action Team, were followed.  These practices include: individualized treatment plans, addiction risk assessment and close monitoring of the worker's progress.  A new peer-review process would also address a prescriber's failure to comply with best practices.  If approved, the rule would become effective Oct. 1, 2016.



Apparently, The Brickyard is not the only place to see competitive racing in the Hoosier State this month.


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