California Rules
Oct 4, 2016

LEAD STORY

California Gov. Jerry Brown took action on a number of workers' compensation bills before the end of the legislative session aimed at reducing workers' compensation costs to the industry and employers as well as avoiding treatment delays for injured workers.

FRAUD CENTRAL

The California Department of Industrial Relations (DIR) released a statement supporting the two newly signed laws that will reduce treatment delays and improve anti-fraud efforts.  A.B. 1244 requires the Division of Workers' Compensation (DWC) to suspend any medical provider, physician, or practitioner from participating in the workers' compensation system when convicted of fraud. The other anti-fraud bill (S.B. 1160) stays liens filed by physicians or providers who are criminally charged with workers' compensation, insurance, or medical fraud, potentially saving up to $818 million in the workers' compensation system. 

UTILIZATION REVIEW

In addition to the anti-fraud language in S.B. 1160, the bill also reduces and limits utilization reviews (UR) within the first 30 days following a workplace injury. Utilization review is used to determine if treatments are medically necessary for the injured worker and is designed to contain costs and combat medical fraud. The bill also prohibits the use of financial incentives for a physician based on their UR decision and gives the DWC the authority to review UR compensation information.

RATE REDUCTION

The California Workers' Compensation Insurance Rating Bureau submitted an amended and reduced Pure Premium Rate Filing effective Jan. 1, 2017 to the Department of Insurance recommending a rate reduction of 4.3% instead of the previous August recommendation of 2.6%. The new recommendation specially cites the cost savings impact of A.B. 1244 and S.B. 1160 as factors for a further rate reduction.

OPIOID CRACKDOWN

CALIFORNIA

Gov. Jerry Brown signed into law S.B. 482, which will require physicians to check a database for a patient's prescription history before prescribing opioids and other potentially dangerous drugs. California doctors have been able to voluntarily check California's prescription drug monitoring program (CURES) since 2009 but this new law will make it mandatory starting Jan. 1, 2017.

OHIO

Ohio physicians are required to check the state's prescription monitoring program (OARRS) before prescribing opioids, but an audit by the Ohio Pharmacy Board identified doctors who either weren't registered or weren't using the PMP properly. The Pharmacy Board reported those doctors to the Ohio Medical Board, which will investigate the top violators. Approximately 20 states have similar laws requiring physicians to check PMPs before prescribing opioids. New York reported a 75% reduction in "doctor shopping" after its first year using its PMP. In Tennessee, doctors are 41% less likely to prescribe opioids after checking its PMP. PMPs are playing an increasingly valuable role in battling the opioid epidemic. We will keep monitoring its progress.

MAKING OUR WAY AROUND THE COUNTRY

FLORIDA

The Florida Office of Insurance Regulation (OIR) tentatively approved a 14.5% increase to workers' compensation premiums versus the National Council on Compensation Insurance's (NCCI) filing for a 19.6% increase. In its reasoning, OIR specifically cited increases due to the recent Castellanos v. Next Door Company and Westphal v. City of St. Peterburg decisions, accounting for a 10.1% increase and 2.2% increase respectively. The rate increase would become effective Dec. 1 for new and renewal business.

MEDICARE

The Centers for Medicare & Medicaid Services (CMS) issued an alert for Reporting Thresholds for Certain Liability Insurance, No-Fault Insurance, and Workers' Compensation Settlement, Judgement, Awards or Other Payments. Based on its cost-to-recover review, CMS has now established a threshold for no-fault and workers' compensation settlements of $750 or less. Cases that fall within the threshold will not need to be reported and CMS will not seek recovery on the conditional payments related to these cases. The current liability threshold of $1,000 or less remains unchanged.

TEXAS

The Texas Department of Insurance announced an informal stakeholder meeting to discuss the 2017 assessment of insurance maintenance taxes and the determination of rates of assessments for the examination of insurance companies and workers' compensation self-insurance groups. Staff and stakeholders will informally discuss the preliminary estimates for the projected rates of assessment as well as the draft rules to establish the rates of each tax and assessment. The meeting will be held on Oct. 26 at 2 p.m. at the TDI offices. 

RYDER CUP

After 2,933 days (or 8 years), the United States clinched a Ryder Cup victory over Europe. If Arnold Palmer's 1975 Ryder Cup bag sitting on the first tee didn't get you, then check here for some of the most memorable moments from this past weekend. 

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