Tag Archives: settlement

It’s Time to Rethink WCMSA Legislation

A fresh approach may be needed to address how best to protect Medicare’s interest in a workers’ compensation settlement.

Today, the Workers’ Compensation Medicare Set-Aside Arrangement (WCMSA) is a routine part of most settlements. The WCMSA takes a part of the workers’ compensation settlement and allocates it specifically for future medical expense. If this is done correctly, the Medicare beneficiary is then free to spend the non-allocated portion.

The widespread acceptance of the WCMSA is based on a recommendation by the Centers for Medicare & Medicaid Services (CMS), the agency responsible for the administration of the Medicare Trust Fund.  The WCMSA has become the de facto rule because CMS can ignore a workers’ compensation settlement agreement between parties if it believes there has been an attempt to shift responsibility to pay for future medical care to the Medicare Trust Fund.

In recent years, however, some have objected in certain types of claims because changes to the review process have increased the dollar amounts that need to be set aside for the WCMSA, to preserve the Medicare Trust Fund. Some feel that the amounts have become unreasonable.  The result has been some failed settlements, contrary to a public policy that favors settlements.

In establishing a WCMSA, information is submitted to the Workers’ Compensation Review Contractor (WCRC), and it is evaluated to provide an allocation number for the set-aside that CMS will accept. There are obvious tensions. For instance, the contractor may require extensive documentation for medical care that goes beyond what is necessary for the workers’ compensation claim. This requirement can delay the process or even require the parties to the workers’ comp claim to start over. The contractor may also increase the amount that has to be allocated for the WCMSA, as medical treatment that is unrelated to the workers’ compensation claim can make it into the set-aside.

CMS allows for the use of structures to fund the allocation that can save some money by avoiding the need for an up-front, lump sum payment. However, there is little flexibility to discuss disputes over treatment, prescription use and costs.

H.R. 1982 is the legislation, supported by the insurance industry, that represents the present attempt at reform. Introduced on May 5, 2013, by Republican Congressman Dave Reichert from Washington’s 8th Congressional District, and co-sponsored by Democrat Congressman Mike Thomas from California’s 5th District, the bill was immediately referred for consideration to two House Committees with jurisdiction over Medicare issues:  Energy and Commerce and Ways and Means. But little else has occurred. Today, as the close of the 113th Congress draws near, H.R. 1982 has 14 co-sponsors, evenly split between Republicans and Democrats, but no companion legislation exists in the Senate.

It is difficult to imagine a path for this bill to become law. Members are getting ready for the August recess, to campaign. When they return, larger issues of foreign policy and immigration will take center stage.

Passage is not impossible, and it is important to continue support through the end. It is also important to plan ahead, as about 9,170 bills are currently pending, and only about 5% are expected to become law when this congressional session ends on Dec. 31. Revisiting the strategy of H.R. 1982 is important to improve chances of success should re-introduction be necessary.

Revision would necessitate assembling likely stakeholders. This meeting should take place as early as possible to allow for an early introduction in the 114th Congress. The process should follow that adopted by the Medicare Advocacy Recovery Coalition (MARC), which led to the successful SMART (Strengthening Medicare and Repaying Taxpayers Act) at the close of 2012. Broad-based support is critical to success in a Congress that is expected to be even more divided in the next session.

The purpose of H.R. 1982 is to increase the number of workers’ compensation settlements with Medicare beneficiaries. This must be an important goal of any rewrite. Because H.R. 1982 is designed to amend the Medicare Secondary Payer Act (MSP), already considered to be “one of the most impenetrable texts within human experience” (Parra v. Pacificare of Arizona, Inc., 2013 U.S. App. LEXIS 7861), another goal must be to have it be easy to understand. A third objective must be to avoid unintended consequences, by clearly defining terms and reconciling conflicts with existing MSP terms.

There can be no doubt that H.R. 1982 favors the workers’ compensation plan. The workers’ compensation industry would go from having no ability to raise legitimate disputes to being freed from constraints. CMS, neutered by the proposed law, could do very little to seek increased protection for the Medicare Trust Fund. This is most likely the Achilles heel of the present legislation.

Congress enacted the MSP law in 1980 to stem the red ink of the Medicare Trust Fund. Congress passed the Medicare & Medicaid SCHIP Extension Act of 2007 in furtherance of that objective. Any succeeding legislation must be consistent with such protections.

This can be achieved and still provide immense benefit for all stakeholders. To see how, here is a look at the major areas covered by H.R. 1982 and how they could be revised to increase the likelihood of adoption:

Thresholds

H.R. 1982 may be too aggressive in codifying what is already well-established CMS policy for situations where Medicare’s interest need not be considered. Already, in situations where the claimant’s treating physician does not reasonably expect continuing medical treatment, the parties are free to settle without an allocation for a set-aside. All that is required is documentation from the treating physician. Similarly, no allocation can be required if medicals, as alleged or claimed, are not being released (in other words, if the medical portion of the claim is not being settled).

Rather than have legislation codify where Medicare’s interest need not be considered, a better approach would be to require CMS to adopt regulations.

One issue that can only be addressed through legislation is a value-based threshold that involves a release (or settlement) of medicals. The H.R. 1982 threshold value includes settlements of as much as $25,000; below that level, Medicare’s interest would not have to be taken into account. Today, CMS does not review such settlements but expects that they will “consider” Medicare’s interest. The necessary analysis can be expensive and so time-consuming that contractors will exceed CMS limits on workload. A way around the analysis of smaller settlements could be for Congress to authorize the CMS actuary to determine a threshold based on the cost to the government of review. The threshold should work out to at least $25,000.

Qualified Medicare Set-Aside

The term “Medicare Set-Aside” is not currently codified in the MSP law. Stakeholders should study the potential unintended consequences of codifying the term in ways that have the force of statute. CMS has established policy and procedures that it recommends on when to submit a WCMSA for approval. H.R. 1982 does not add any benefit by adding definitions and can be simplified by omitting them.

The critical component that should be discussed by stakeholders is whether the rewrite should establish a “safe harbor” settlement amount in which a certain percentage is paid to CMS by lump sum or stream of annuity payments that legally “considers” Medicare’s interests. This approach prevents codification of the WCMSA and still achieves the objective. The percentage of the settlement amount would need to be analyzed to maintain cost-neutrality of the bill. As a starting point to demonstrate neutrality, Medicare Set Aside stakeholders should be able to provide Congress data on the ratio of the MSA allocation to the amount of the settlement.

Authorizing CMS to Receive Allocation Amount

This is long overdue. While it sounds like such a feature would add revenue to Medicare, helping the bill to pass, government accounting won’t recognize this approach. The Congressional Budget Office must score each bill to determine if it costs or saves money, and the CBO doesn’t count as revenue money that is received in advance of when it needs to be paid out. This method is counterintuitive, but stakeholders must take it into consideration. Nonetheless, for the benefit of the injured worker, and non-interruption of Medicare or Social Security benefits, letting CMS receive the WCMSA allocation amount is important and would make sense to Congress.  It is important to have the legislation authorize both a lump sum and stream of annuity payments.

Limiting Conditional Payments to the Fee Schedule

Stakeholders should discuss the issue of healthcare providers that, under present CMS regulation, may collect more than is allowed under the fee schedule. H.R. 1982 is designed to deal with considering Medicare’s interest in workers’ comp settlements, and it might be wise to limit legislation to that area rather than also taking on the issue with fee schedules. Simplifying the legislation might avoid drawing unintended adversaries who might lobby against it.

Applicability of Fee Schedule

CMS already accepts the workers’ compensation fee schedule or, in its absence, the usual and customary rate. H.R. 1982 would like to extend the use of the workers’ compensation fee schedule, but some plans may already have better rates. Stakeholders should discuss how medical services and items, including pharmacy, should be priced. There must be no cost to the Trust Fund because of any legislation. In fact, there are ways in which the fee schedules could benefit the fund.

Right of Appeal

Last year, the Strengthening Medicare and Repaying Taxpayers Act (SMART) became law, providing for an appeals process for workers’ compensation laws or plans. The legislation requires appeals over any “determinations” by CMS. Because an approved WCMSA is a CMS “determination,” it would logically be subject to the appeals process. But, because the WCMSA process is recommended and not required, the appeals process may not be triggered. When parties use the WCMSA, they also waive any right of appeal. The appeals process specified by SMART therefore has no applicability unless the WCMSA is required by an actual law. Stakeholders should consider adding legislation to strengthen the SMART right of appeal. A fair, two -way process to discuss legitimate disputes is essential to increasing settlements.

Respecting State Decisions

Recently, CMS issued an updated user guide for WCMSA submissions. A section was added that has resulted in confusion on the application of state law. Section 4.4.1 states that CMS will respect the allocation of non-medical portions of a settlement by a board with appropriate jurisdiction, after a hearing on the merits. By implication, what’s left over in the settlement is for medicals, and CMS likely would respect that allocation, as well. But CMS may disagree. Stakeholders should discuss clarification of how state law should work with the Medicare Secondary Payer Act. This may require an analysis of pre-emption rules, as well as defining the types of hearings.

H.R. 1982 has both positive and negative implications, creating mixed support. CMS will most likely oppose it if it moves in the present Congress, as it prevents CMS’ ability to enforce the MSP and protect the Trust Fund. Providers, MSP compliance companies and structured-settlement companies would also line up to oppose the bill. It is not clear where beneficiaries and beneficiary organizations will line up – while, in the short run, H.R. 1982 would cause more cases to settle, the adverse impact to the Trust Fund may result in delay in the delivery of benefits as well as their reduction. Nonetheless, there are positives to H.R. 1982.

A fresh approach is needed with all stakeholders involved to secure broad-based support to resolve problems for the injured worker, CMS and the workers’ compensation law or plan.

With the right legislation, a fix can happen, and one is sorely needed.

Settlement of High-Exposure Workers’ Comp Claims, Part Three

Part I (Identification) and Part II (Valuation) of this series provided insight into identifying and correctly valuing the appropriate cases to approach for settlement. In Part III, we will turn an eye toward successful negotiation and resolution. 

Negotiation

Beyond the financial aspect of the negotiation are underlying factors that are not always obvious. The most important aspect to understand is that there is an individual whose life has been seriously affected by an industrial injury. Many times this fact is lost in the volumes of reports, bills and correspondence.

Preparation

After the valuation of the case has been completed, several elements still remain that need to be addressed before proceeding with negotiation.

First, the future indemnity exposure and its value must be evaluated. Next is consideration of the injured workers’ Medicare status. Criteria have been outlined in various memoranda put out by Centers for Medicare and Medicaid Services (CMS); critical elements include:

  1. Is the individual receiving Medicare benefits?
  2. Is there a reasonable expectation in the next 30 months that the individual will be entitled to Medicare benefits, and the settlement is in excess of $250,000?

If the answer to either question is “yes” then the parties should conduct a Medicare Set-Aside analysis. Is it best to fund the MSA with cash or an annuity? In most high-exposure cases, the MSA is substantial, and the use of an annuity is critical to settlement. Once the MSA is completed, submission to CMS for review and approval should be sought as soon as possible. At present, the turnaround time is approximately four to five weeks, though it sometimes takes considerably longer. 

The next consideration is the value (future and discounted) of items such as home/attendant care, non-covered equipment and off-label medications. These are all the “medical” items that cannot be paid for through the MSA and would become the responsibility of the injured worker. 

Finally, as each case is unique, are there any other factors specific to the individual’s case that must be considered, such as retroactive or unpaid benefits, disputed costs or out-of-pocket expenses?

In most high-exposure settlements, a combination of cash and annuities are going to be the critical elements. At a minimum, most MSAs are funded via “seed” (initial payment) and annual payments via an annuity. The balance in some instances is paid in cash; however, in most cases, some form of future income stream should be created to ensure the injured worker has funds to pay for non-Medicare-covered items as well as some level of income replacement for either a fixed period or for the remainder of his life. 

Human Element

The human element cannot be overlooked. Many times, the individual needs to “vent” by telling his story. This can be a cathartic moment that forms a bond with the injured worker and establishes a level of trust. 

Bringing all parties together face-to-face to lay out the issues from all sides is crucial. This creates an environment of understanding and illustrates a seriousness about resolution, and the intelligence gained is invaluable. Many times, an injured worker makes a seemingly benign comment that is the key to resolving a case. For example: “I want to make sure my family is taken care of after I die.” Or, “All I want to do is move to my house in Oregon and spend the rest of my days bass fishing,” or “I would like better living arrangements for myself and my Rottweilers.”

These are actual comments made during initial discussions that, with a little creativity, let the parties craft a settlement that fit the needs of injured workers. This is not to suggest that these cases could not have otherwise settled, but the key to resolving them was to find what was important and unique to the injured workers.

Many workers are frustrated by the workers’ compensation system and are seeking a way to move on to the next chapter of their lives. 

Creativity

There is no such thing as “one size fits all” in high-exposure claims. Crafting the most beneficial settlement for the injured worker is the key. Gone are the days of a fixed amount of cash plus the funding of the MSA.

For the worker who wanted to bass fish, for example, a settlement was crafted to include a bass boat, a small amount of cash and a lifetime income stream through an annuity. The agreement was reached in a very short time. For the worker who wanted to be sure his family was cared for after his death, a settlement was crafted — again, within the framework of the value of the case — to provide him an upfront sum of cash, an annuity to fund his MSA and a tax-free annuity referred to as a “Joint and Survivor Benefit” that produced income for him and his wife as long as either was still living. For the worker worried about her pets, a creative solution provided for housing accommodations for her and her two very large dogs. 

The point is to pay close attention and understand what is important to an injured worker. While we all may have opinions about the best way to craft a settlement, ultimately it is the injured worker who has to live with it. Providing workers with settlements that meet their specific needs and wants will not only engage them in the settlement process but will leave them with the satisfaction that they got what they wanted.  

Resolution

Once terms are agreed on, we arrive at the resolution phase. At this point, jurisdictional requirements need to be considered, and they are quite variable. 

The first issue is to ensure that Medicare’s interests have been adequately considered. Then, aside from any conditional payments by CMS that may exist and will need to be addressed post-settlement, the remaining issue is to ensure that settlement documents are drafted that meet the requirements of the specific jurisdiction (state, federal, etc.). Typically, this is handled by defense counsel.

Conclusion

If the parties are prepared, the negotiation and resolution phase moves rather quickly from an initial discussion to an agreement of terms, to the preparation of settlement documents and finally to submission to the appropriate entity for approval. Beyond preparedness, the keys to success include understanding the human element and being creative about addressing the needs and concerns of the worker while staying within the value of the case.

Addressing the three elements covered in this series on high-exposure workers' compensation claims — Identification, Valuation and Negotiation/Resolution — will benefit all parties. The carrier/self-insured will reduce projected exposure. For the injured worker, while a settlement cannot replace what he lost, it will let him move forward with his life based on an adequate, fair settlement. 

Settlement of High-Exposure Workers’ Comp Claims, Part Two

(Part I of this series focused on how to identify high-exposure claims and on the factors that drive cost and duration. Part II focuses on approaches to establish the value of a case, to determine if it is a good candidate to settle.)

Three numbers are critical in the valuation and determination of whether a case is a good candidate for settlement: future value, present value and settlement value.

Future value

The analysis of future valuation provides, by reserve category, a value for the indemnity, medical and expenses projected for the future of the case. 

The indemnity exposure is driven by statutory requirements for both permanent partial and permanent total disability. Typically, permanent partial disability is a fixed number of weeks multiplied by a weekly benefit. Likewise, permanent total disability benefits are calculated at a fixed rate; however, in most instances the benefit is payable for the life of the injured worker. A complication is that each jurisdiction views permanent partial and permanent total disability differently.

Determining the future medical exposure can be even more complicated. In many instances, a calculation will be made based on the average spending on the case over the past three years, but a more thoughtful analysis is necessary to determine the true future value. The analysis should be calculated based on the normal, expected treatment that an injured worker will need over the course of the claim but also consider the irregular treatment modalities necessary or requested by the physician. These may be surgeries, replacement of motorized wheelchairs, conversion vans, etc., which occur on an irregular basis; for example, a replacement van would be required every eight to 10 years, or a motorized wheelchair may need to be replaced every five to seven years. By parsing out these items, a much more accurate and appropriate analysis will be developed. 

Even once you understand the future exposure and the present value of a case, you still should consider other factors, such as co-morbidity and the reduction in the life expectancy of an injured worker because of both industrial and non-industrial conditions (factors discussed in Part I: Settlement of High-Exposure Claims Part I). 

Co-morbidity factors can indicate whether an injured worker’s life expectancy suggests there will be a need for, perhaps, a second knee surgery (at the 30-year mark). Will the injured worker’s condition deteriorate to either create a need or expand the existing exposure for home/attendant care? 

The most significant costs in high-exposure claims typically are medical, and a calculation of settlement value should also take into account that great savings can be achieved. In many instances, savings can be realized through turning the Medicare Set Aside, presuming one is necessary, into an annuity. Assessing non-Medicare type items such as home/attendant care and “off label” medications can also produce savings.

Expenses are also sometimes difficult to quantify. Allocated expenses such as legal fees and record subpoena services may diminish over time as issues begin to resolve. Depending on the jurisdiction, continuing litigation costs may be incurred if a defendant denies a treatment modality or procedure. In addition, consideration should be given to “other” medical expenses such as bill review, utilization review and nurse case management services. These typically continue through the life of the claim and may cost thousands, if not tens of thousands, of dollars. 

Present value

When analyzing the present value (also referred to as a discounted value) of benefits, it is important to understand the time value of money and current internal rates of returns on investments. The typical internal rate of return for annuities is currently approximately 4%. This rate varies, primarily based on interest rates. Carriers and self-insured employers have greater buying power, so they might expect a return of 6% to 7%.  

Determining present value is a straightforward calculation based on whatever the right discount rate is but requires a detailed understanding of likely expenses. Is the injured worker only entitled to benefits for a specific number of remaining weeks? Or, is the benefit payable for life? Determining the present value of the consistent medical generally is a matter of calculating the average annual cost and applying the appropriate discount rate. With irregular costs, it is necessary to understand the specific items in question and the estimated frequency of each. If an injured worker needs knee replacements and will require two over her lifetime, an estimate is needed as to when those will occur (for example, in 15 years and again in 30 years) and the anticipated cost of the surgery. The present value of the surgeries can be calculated based on how many years off they are. 

Discounting expenses associated with a case is typically handled much like the medical discounting. For the regular, consistent costs, an annual amount can be calculated and discounted for present value. If intermittent litigation and other expenses may occur, estimates are created and discounted for present value.

It is safe to say there is some art associated with determining present value. Variances in the discount rate used, the manner in which exposure is calculated and other factors can greatly affect the calculation. Understanding these variables and analyzing them correctly is imperative to reaching a solid present value calculation.

Settlement value

The nature and type of insurance program (primary vs. self-insured) as well as the manner in which the defendant has analyzed his exposure will greatly affect the settlement value of a case.  Understanding the differences between the future exposure and present value calculations aid in determining the amount of money that a party is willing to spend to bring closure to a file. 

Lacking a crystal ball, reserving practices have always had an aspect of “art” to them; thus the future value will have some variation over time based on changes in treatment course, deterioration in condition and other factors.  Present value calculations are estimations or approximations based upon the changes in value of money over time.

Likewise, the settlement value of a case is the best estimate of where the future needs of the injured worker will be, with consideration of the time value of money and degree of desire to extinguish the exposure now—before there is any further potential for expansion or deterioration in the condition, creating a greater degree of expense and exposure in the future. 

A discussion of settlement value should consider that a settlement of the case-in-chief not only ends direct expenses such as litigation, utilization review and nurse case management but also brings to an end the time and energy expended to adjust the claim. Time and energy are usually disproportionately great in high-exposure cases because of the complexities.

A settlement also helps the carrier/self-insured employer by possibly allowing it to recover reserves set aside for a case and by reducing exposure to any expansion of the claim as the years go by.

Conclusion

Ultimately, the objective is to bring these high-exposure cases to resolution as promptly and cost-effectively as possible because, for carriers and self-insured employers, this small percentage of cases drive the majority of costs associated with a workers’ compensation program.

Part III of this series will cover Negotiation and Resolution.

Lessons from the Godfather Trilogy: Universal Principles and Practical Advice

Few movies are as revered or have reached the iconic status in American culture as the movies that make up The Godfather Trilogy.  Obviously, the great acting by many incredible actors in these films plays a major part in achieving that status.  But perhaps even more appealing is the writing behind the film which has generated many lines that can not only be considered quotable quotes but also, in a broader sense, universal principles of life.  These universal principles are applicable to all walks of life from the mob underworld to all levels of the business world and can provide practical instruction to all who are open to such advice.

“It’s not personal Sonny.  It’s strictly business”
Michael to Sonny in The Godfather

There may be nothing more important to sound business practices than the principle that decisions to be made should never be motivated by personal or emotional animus but rather should always be the result of an objective decision-making process.  All too often, the actions and adverse positions of opposing parties are taken personally and retaliation is sought without first thinking through and formulating an appropriate response on an objective basis and in accordance with the circumstances.

The pros and cons of a business decision cannot be properly and professionally evaluated if one’s judgment is clouded by emotionally charged and negative feelings towards the opposition, particularly during the course of negotiations.  Accordingly, if you find yourself unable to separate yourself from an emotional opinion of the situation presented, it may be wise to run the matter by a colleague for a fresh and objective viewpoint.

It is particularly important to remain objective when evaluating matters and engaging in settlement negotiations.  Emotions have no place during negotiations but can run high and get in the way of an objective evaluation of the matter at hand.  Ultimately, in all cases, it’s not personal, it’s strictly business.

“Never hate your enemies – it affects your judgment”
Michael to Vincent in The Godfather, Part III

A corollary to the general rule that negative emotions should have no place in business matters is that one should never allow issues to become personal with the opposition.  When one allows their emotions to intrude into their dealings with another, the ability to evaluate any and all issues that arise is clouded by such negative feelings.

As difficult as it may be, one must attempt to disassociate and cut out any negative feelings or animosity (even when such emotions may be warranted under the circumstances) towards a business associate.  Only then can a proper evaluation and handling of the issue or case be completed.  After all, remember what happened to Sonny Corleone in The Godfather when he allowed his emotions to cloud his judgment and get the best of him.

“Keep your friends close, but your enemies closer”
Michael to Pentangeli in The Godfather, Part II

No advice may be as difficult to heed than the caution to keep your enemies or adversaries close.  Unfortunately, there are some adversaries in the business world who thrive on petty confrontation and routinely taking matters to a personal and negative level.  Such people seem to enjoy pushing buttons and disrupting the normally smooth handling of business transactions.  While there is no valid place in business for such boorish behavior, there is usually no recourse against the same and one must be prepared to deal with such people effectively in order to provide their clients with the representation they are entitled to and/or to obtain the result desired.

One way to deal with such “enemies,” or all adversaries for that matter, is to keep them close.  A way to keep them close is to be more knowledgeable on the issue at hand in order to keep a step ahead.  Additionally, as aggravating as the adversary may become, it never fails to remain in control of your own emotions and hit them with kindness, good humor, and/or rational explanations supporting your position.  Also, a positive way to view the difficult situation of having to deal with such people is to remember that each communication will move the parties one step closer to the eventual resolution of the issue at which point you will no longer have to deal with that person on that matter.

“I’m gonna make him an offer he can’t refuse.”
Don Corleone to Johnny Fontaine in The Godfather

In terms of settlement negotiations, it may be said that you can not sell something to someone they do not want to buy.  When negotiating, one should put themselves in the position of that opposing businessperson or client and attempt to frame any settlement offers in the best light from that perspective. 

For example, the value of settling a matter now as opposed to after many more months of negotiation can be emphasized.  Where the parties are engaged in a non-binding mediation and have reached an impasse, perhaps the offering of paying for the mediator’s services by one party can spark further discussions to an ultimate resolution.  By thinking of settlement from the other party’s perspective and being creative and positive in framing your settlement offers, one may be able to effectuate a settlement of a case within one’s range of range of value.

In trying to reach any resolution of a matter, it must be remembered that emotions have no place in negotiations.  If at all possible, check any emotions generated by the case or your interactions with the opposition prior to entering into any settlement negotiations.  All attempts should be made by both parties to participate in the settlement discussions in the most objective and business-like manner possible. 

“I have always believed helping your fellow man is profitable
in every sense, personally and bottom line.”
Michael to reporters in The Godfather, Part III

Although Michael Corleone may have issued this statement with a sense of irony, it cannot be denied that helping your fellow man is indeed profitable in every sense.  In addition to assisting all of our clients with their business matters, a businessperson may also profit on a personal level by volunteering one’s services within the scope of their expertise wherever possible. 

In addition to the altruistic reasons in support of volunteering in the community, such activities have the consequent benefit as a source of networking and advertisement.  By participating in charitable activities, one can come to know many different people as well as have your name or your firm’s name disseminated to the public in a positive light. 

“…a man who doesn’t spend time with his family can never be a real man.”
Don Corleone to Johnny Fontaine in The Godfather

While the demands and pressure associated with developing a business are great, there is no opportunity to replace missed moments with one’s family.  Life is short and there are no second chances to recover such priceless moments.

Whenever possible, a balance between work and life outside of work should be sought and encouraged.  It can be said that people who develop their life outside of work, particularly with their families, but also in terms of their hobbies, recreational activities, and in exploring creative outlets, are more apt to have a higher productivity level when it comes to work.  Spending and enjoying more time with one’s family will tend to serve as a release from the pressures of work and lessen one’s overall stress level which, in the end, results in a more healthy lifestyle overall.  A more healthy lifestyle, in turn, may render you a more productive and efficient worker.  In the end, all aspects of your life both in and out of work will benefit.

Conclusion

 An understanding and application of the universal principles enunciated by the great characters in The Godfather Trilogy to one’s business practices can improve one’s abilities and may also serve to ease the stress generated by the profession.  All in all, with the business world as demanding as it is in and of itself, an effort should be made by people to deal with each other in an objective and professional manner without descending into personal animosity and attacks.  Ideally, we should treat others as we desire to be treated and should maintain positive and objective arguments as opposed to attempting to pursue or defend a matter through negative and emotionally charged tactics or personal attacks.  In the words of Clemenza from The Godfather, we should metaphorically, “Leave the gun.  Take the cannoli.”  In the end, by leaving behind a negative or personal handling of a matter and instead taking a positive business-like approach to all issues, the business world as a whole will benefit.

Workers' Compensation No Longer the Exclusive Remedy: RICO on the Radar, Part 2

Understandably, Part 1 of this article series has been met with some controversy and skepticism. The article is not designed to scare employers, as might have been suggested. Its intention is to educate employers about the many issues facing them when an employee becomes injured, that transcend the State Workers’ Compensation System and a workable solution to overcoming the challenges. Employers can no longer afford to bury their heads and rely on the exclusive remedy position. Yes, it may be here to stay, but it is becoming a bit frayed around the edges.

Coincidently, when Part 1 of this article was published, The National Football League (NFL) announced that it had reached a 765 million dollar settlement with players and their families for the settlement and consolidation of approximately 4,500 concussion claims. The players alleged that the NFL hid or ignored the facts that concussions caused brain injuries. Under the settlement, the NFL will pay 675 million dollars to retired players who demonstrate medical evidence of brain injury. Payouts of up to 5 million dollars each could go to players found to have Alzheimer's or Parkinson's diseases or other concussion-related conditions, or to their families. The settlement came just prior to the start of football season and will put an end to the mounting litigation that threatened the multi-billion dollar league.

United States District Presiding Judge Anita B. Brody appointed Judge Phillips to oversee the negotiations. Judge Philips said, “This is a historic agreement, one that will make sure that former NFL players who need and deserve compensation will receive it, and that will promote safety for players at all levels of football.”

 “This agreement lets us help those who need it most and continue our work to make the game safer for current and future players. Commissioner Goodell and every owner gave the legal team the same direction: do the right thing for the game and for the men who played it,” said NFL Executive Vice President Jeffrey Pash. “We thought it was critical to get more help to players and families who deserve it, rather than spend many years and millions of dollars on litigation. This is an important step that builds on the significant changes we’ve made in recent years to make the game safer, and we will continue our work to better the long-term health and well-being of NFL players.”

Once final documentation is completed, the settlement will be filed with Judge Brody, who will then schedule a hearing to consider whether or not to grant preliminary approval to the agreement. The retired players will then have the ability to file objections to the settlement.

One may ask what this has to do with Part 1 of this article.  An important component of this settlement is baseline testing. According to the settlement, baseline medical exams will be provided, the cost of which will be capped at $75 million. This will be a key element in ascertaining the conditions of current and retired players, gauging  the progression of any injuries they may have and having documentation of the medical status. This key component is the subject of Part 1 of this article. Baseline testing is not simply a self-promotion for the EFA-STM, but is a major part of helping injured workers, no matter what their occupations may be.

These cases are just the beginning, and it appears that the exclusive remedy provision for workers' compensation will no longer serve to prevent costly civil litigation as evidenced by the NFL settlement. An employer, insurance carrier/TPA and physician can take several steps to protect themselves. First, evidence-based medicine should always prevail. Objective medical evidence can help protect against claims for fraudulent denials of work-related injuries. Also, employers should accept only claims that arise out of the course and scope of employment (AOECOE). If an employer can objectively document AOECOE issues, fraudulent claims and fraudulent denials can be avoided and most importantly, correct treatment can be prevail.

A good approach to determining AOECOE claims is baseline testing, as it can identify injuries that arise out of the course and scope of employment. When a work-related claim is not AOECOE, as proved by objective medical evidence, such as pre and post assessments, then not only is there no workers’ compensation claim, there is no OSHA recordable claim, and no mandatory reporting issue. Conversely, if there is an injury, the injured worker can get the best site specific treatment and prevent inappropriate treatment and unnecessary progression of the underlying conditions.

The NFL recognized the importance of baseline testing with its recent settlement, and it is only the beginning. MSD for NFL players is also a significant problem. Why not baseline all football players, or, for that matter, all professional athletes, to address any injuries that may occur while playing and return them to the field sooner? This would promote better health and performance and might extend their careers. Professional athletes tend to play through their injuries, potentially causing more harm. An objective baseline test can assist all parties by providing objective medical evidence of an injury and outlining appropriate care. This truly is a win-win situation.

A proven example of a baseline test for musculoskeletal disorders (MSD) cases is the EFA-STM program. EFA-STM program begins by providing baseline injury testing for existing employees and new hires. The data is interpreted only when and if there is a soft tissue claim.  After a claim, the injured worker is required to undergo the post-loss testing. The subsequent comparison objectively demonstrates whether or not an acute injury exists. If there is a change from the baseline, site specific treatment recommendations are made for the AOECOE condition, giving the doctors more information and helping to ensure the injured worker receives the best care possible.

The case of the NFL settlement may not be a RICO claim, but, certainly, it tries the boundaries of the exclusive remedy provision of workers compensation. Baseline tests like the EFA-STM are a proven way to providing better work-related care. It is time for change and to think outside of the box to provide the answers so that we can become proactive, not reactive.