Category Archives: Legal Issues

Sad News

Learned this afternoon of the sudden death of my fellow blogger, David De Paolo. See the link below. Never met him, but readers here know that I have always reported what he wrote fairly and honestly, and even though my comments to him have not appeared in my posts, I respected him as a fellow blogger.

He will be sorely missed, as he was a regular fixture in many of my posts.

http://www.workerscompensation.com/compnewsnetwork/news/24272-david-depaolo-founder-of-workcompcentral-dies-at-56.html

 

ERISA, Stop Loss and Unintended Consequences

“The problems of the world cannot possibly be solved by skeptics or cynics whose horizons are limited by the obvious realities. We need men who can dream of things that never were.”

John F. Kennedy

“Some men see things as they are and say why. I dream things that never were and say why not.”

Robert F. Kennedy

“It is not because things are difficult that we do not dare, it is because we do not dare that things are difficult.”

Seneca

Those quotes were included at the top of my June 19, 2013 post, “Clearing the Air: My Defense of Implementing Medical Tourism into Workers’ Compensation” where I defended myself against the charge that I was offering “simplistic solutions” to medical travel and workers’ comp. In that post, and in “The Faith of My Conviction: Integrating Medical Tourism into Workers’ Compensation is Possible and is not a Pipe Dream” I acknowledge that is won’t be easy, but there are ways to do it.

In my last post, “Self-Insured Employers Fail To Adopt Medical Travel“, I discussed the reasons given by Irving Stackpole for why US employers have failed to adopt medical travel into their corporate health plans.

In conversations with a noted ERISA and medical travel expert, I have been making the case that laws and regulations such as ERISA, Stop Loss, and other “barriers” erected decades ago, in order to address specific problems such as tort claims, aggregate claim losses, etc., have the unintended consequence of holding back the globalization of health care, which includes workers’ comp.

I have addressed the legal barriers in comp in my White Paper, and found that there were outdated federal and state laws and regulations, intended to protect consumers, actually increase costs and reduce convenience, restrict public providers from outsourcing certain expensive medical procedures, and that federal laws inhibit collaboration, while state licensing laws prevent certain medical tasks being performed by providers in other countries.

Let me state here that I, in no way, am advocating the removal of these laws and regulations. My chief argument is this: our best minds have split atoms, launched satellites and men into space, discovered cures for diseases plaguing humans for centuries, but to send patients to other countries for medical care is impossible, and not worth pursuing, smacks of cowardice or fear that it actually might save money and provide better care. Do we not have the best minds to figure out how to deal with these “barriers”, or are we too fearful and litiginous a society that we have given up accepting new ideas?

Every industry is being affected by two powerful forces today: globalization and automation. With globalization, jobs, plants and other forms of capital are moving across borders. With automation, jobs that were once held by humans and considered very dangerous, are being done by robots, and soon other jobs will be done by artificial intelligence.

Neither force can be stopped, and how we address the consequences of these forces is what many minds are working on right now. But to say that one industry is going to draw a line in the sand and say, “NO” and stop globalization from happening is either insanity or a deliberate attempt to profit from the maintenance of the status quo that many along the supply chain of medical care services, both within the general health care space and workers’ comp have carved out for themselves.

When I was in college, I studied International Relations, and back then, globalization was a word very few outside of academia ever heard. There was an organization created in 1973 by David Rockefeller and Zbigniew Brzezinski called the Trilateral Commission. Its purpose was to foster better cooperation between the countries in North America, Western Europe and Japan (the Trilateral countries) and their multinational corporations. In the ensuing decades, the Commission expanded the membership to the rest of the world, and globalization became a household word.

Coincidence? I think not, since the heads of major US, Western European, and Japanese companies were members, and so were many politicians, including a former peanut farmer from Georgia and most of his top administration personnel. Other politicians after him also have been members, from both sides of the political spectrum.

Their chief goal is to allow capital, goods and jobs to cross national borders, or to eliminate them altogether, and I doubt they expected the health care industry to stand in their way. These are men who generally get what they want, and damn the consequences. We see this in the breakup of the European Union, which many of them advocated for years, just like they advocated for NAFTA, CAFTA, the TPP, and other trade deals, and don’t give a fig about the impact they have.

So, it is important to realize that the only real thing preventing medical travel is what unintended consequences have on the growth and development of the industry. This is where the industry needs to focus its attention, not on slick advertising, but on hard work and cooperation to overcome these “barriers”.


I am willing to work with any broker, carrier, or employer interested in saving money on expensive surgeries, and to provide the best care for their injured workers or their client’s employees.

Ask me any questions you may have on how to save money on expensive surgeries under workers’ comp.

I am also looking for a partner who shares my vision of global health care for injured workers.

I am also willing to work with any health care provider, medical tourism facilitator or facility to help you take advantage of a market segment treating workers injured on the job. Workers’ compensation is going through dramatic changes, and may one day be folded into general health care. Injured workers needing surgery for compensable injuries will need to seek alternatives that provide quality medical care at lower cost to their employers. Caribbean and Latin America region preferred.

Call me for more information, next steps, or connection strategies at (561) 738-0458 or (561) 603-1685, cell. Email me at: richard_krasner@hotmail.com.

Will accept invitations to speak or attend conferences.

Connect with me on LinkedIn, check out my website, FutureComp Consulting, and follow my blog at: richardkrasner.wordpress.com.

Transforming Workers’ Comp Blog is now viewed all over the world in over 250 countries and political entities. I have published nearly 300 articles, many of them re-published in newsletters and other blogs.

Share this article, or leave a comment below.

Florida State Supreme Court Upholds Law’s Validity

Following up on what I reported on earlier this week, the Supreme Court of Florida unanimously decided not to review Daniel Stahl v. Hialeah Hospital, according to Business Insurance’s Stephanie Goldberg.

In my previous post, I mentioned that the 1st District Court of Appeal had ruled that attorney fee schedules violated state law.

But the Court of Appeal also ruled back in March in the above referenced case, that the workers comp system was an adequate exclusive remedy, Ms. Goldberg said in her article.

The State Supreme Court accepted jurisdiction to review the decision, and said in its ruling that, “after further consideration and hearing oral argument in this case, we have determined that we should exercise our discretion and discharge jurisdiction.”

So for the time being, it would seem that Florida’s Workers’ Compensation law is constitutional, and until other cases that are pending are resolved (see my articles, “Constitutionality of Workers’ Comp Challenged: What that could mean for Medical Travel“, “Update on Constitutionality of Work Comp in Florida“, and “Advocacy Group Petitions Florida Supreme Court to Review Work Comp Constitutionality“), Florida’s injured workers will still have something to protect them.


I am willing to work with any broker, carrier, or employer interested in saving money on expensive surgeries, and to provide the best care for their injured workers or their client’s employees.

Ask me any questions you may have on how to save money on expensive surgeries under workers’ comp.

I am also looking for a partner who shares my vision of global health care for injured workers.

I am also willing to work with any health care provider, medical tourism facilitator or facility to help you take advantage of a market segment treating workers injured on the job. Workers’ compensation is going through dramatic changes, and may one day be folded into general health care. Injured workers needing surgery for compensable injuries will need to seek alternatives that provide quality medical care at lower cost to their employers. Caribbean and Latin America region preferred.

Call me for more information, next steps, or connection strategies at (561) 738-0458 or (561) 603-1685, cell. Email me at: richard_krasner@hotmail.com.

Will accept invitations to speak or attend conferences.

Connect with me on LinkedIn, check out my website, FutureComp Consulting, and follow my blog at: richardkrasner.wordpress.com.

Transforming Workers’ Blog is now viewed all over the world in 250 countries and political entities. I have published nearly 300 articles, many of them re-published in newsletters and other blogs.

Share this article, or leave a comment below.

Courts Striking Down Work Comp Laws

Coming back around to the constitutionality of aspects of the various state workers’ comp laws, an article by David De Paolo last week, suggested that rather than corporate America dismantling workers’ comp, it is the courts who are actually doing so.

David says that state supreme courts will be the ones doing the dismantling this year, piece by piece.

A week and a half ago, I wrote that the Oklahoma WC statute relating to the permanent partial disability deferral provisions of the state’s workers compensation statutes of 2013, was struck down in a 7-2 decision.

This decision was first reported in The Oklahoman.

And David also reported in the same article, that the 1st District Court of Appeals in Florida said that the state’s statutory limits on the payment of attorneys for injured workers was unconstitutional.

So while ProPublica and others rightly or wrongly accuse corporate America, the Koch Brothers, ALEC, ARAWC, the Illuminati, Martians, and anyone else we left out, it is the men and women who wear black robes who are striking down the workers’ comp laws in their states.

Is this a coincidence? Is this a vast conspiracy of right-wing jurists and those who put them on the bench? That is hard to say because we don’t know these people at all, who appointed them, and what their individual political motives are.

But if these decisions are any indication, the courts are ruling more in favor of injured workers, than their employers.

If you read De Paolo’s article and the cases linked to them, as well as the OK case, you will see that the courts are generally siding with workers.

What does this mean?

Well, it is too early to tell, but if these trends continue this year, 2016 may be the year the injured worker gets a little break. But we still have laws, regs, and rules in place that are holding back workers from getting the best health care available, at lower cost, no matter where that happens to be, even if it is not within the borders of their state or the country.

And that is something courts in the future will have to decide.

Trouble Ahead for Workers’ Comp

The Denver Business Journal today published an article by Steve Doss, VP of Commercial Lines at CCIG.

Here are the key takeaways from Conning, a Connecticut-based investment management company for the insurance industry:

  • Accident frequency has increased. A stronger U.S. economy has meant more inexperienced workers have joined the workforce, so high-hazard occupations like transportation and construction have seen increases in work-related injuries since 2012. For example, non-fatal work-related construction injuries jumped 9.5 percent from 2012 to 2013. Also, as older employees work longer, the number of accidents among those 65 and older rose 18.5 percent from 2012 to 2013.
  • Accident severity is rising. The Bureau of Labor Statistics reports that construction fatalities rose 5.6 percent from 2013 to 2015, and manufacturing fatalities rose 9.3 percent from 2013 to 2014. In addition, hospital and drug costs – the biggest expenses associated with workers’ compensation claims – are rising faster than inflation.
  • Evidence of cost-shifting. The Affordable Care Act may be driving physicians and hospitals to “leak” group health cases into the workers’ compensation system, where they can charge more for the same services than under a group health contract, according to Conning.

For those of you not familiar with workers’ compensation, and those of you who are, what each of the bullet points mean, in simple terms is this:

  • More accidents,
  • Degree of accident injury increasing and,
  • Cost-shifting is occurring.

Isn’t time to stop and realize that whatever programs are implemented, whatever analytical or predictive modeling techniques are utilized, whatever the so-called “experts” say is the cause of this or that problem, whatever so-called “reform” or work comp alternative is attempted, wouldn’t it be prudent to think outside the box, and outside the borders of your limited minds?

Schopenhauer said the following:

“Every man takes the limits of his field of vision for the limits of the world”

Those of you who will not listen to other ideas, no matter how far-fetched they may be, have limited your field of vision and taken them as the limit of the world. The world is globalizing, health care included.

Aerospace technology will very soon allow us to travel to any part of the world in under four hours. Don’t believe me? Ask Boeing why they are running commercials that tout that very same possibility.

Those who cite judges as saying no to medical travel must ask yourselves this question: Do doctors sentence people to death? (By that I mean execution, not natural death from disease or incompetence)

Those who say the laws won’t allow it, should know that laws can be changed, and laws written in the era of the horse and buggy should not dictate to the post-modern, jet-age, and soon-to-be sub-orbital space plane age. Would you like to live under the laws of Caesar or Charlemagne?

And finally, those who say the injured workers won’t go abroad to get better medical care, have you ever asked them, or are you just putting your words in their mouths?

Methinks you all doth protest a bit too much for the sake of injured workers and myself. Look in the mirror and ask yourselves why workers’ comp is failing. The answer is staring right back at you.

Borderless Healthcare: A Model for the Future of Medical Care in Workers’ Comp

By now, many of you, my faithful, and not so faithful readers (and critics) have been aware of my strong interest and passion about implementing medical tourism into workers’ comp.

The critics have not silenced me, they have only made me more determined than ever to get the word out…MEDICAL CARE UNDER WORKERS’ COMP IN THE US WILL HAVE TO GLOBALIZE, OR ELSE IT WILL FAIL TO PROVIDE ADEQUATE CARE AT LOWER COST AND AT EQUAL OR BETTER QUALITY THAN WHAT IS RECEIVED CURRENTLY.

I capitalized the above because in the three plus years I have been writing this blog, it takes a bit of shouting to get heard in this world.

To make the point I just shouted, I participated yesterday in a webinar on Bloomberg BNA.com produced by Manatt, Phelps & Phillips, LLP/Manatt Jones Global Solutions.

For all of you political junkies out there, Charles Manatt was the Chairman of the Democratic Party from 1981 to 1985, in the first term of that has-been Hollywood actor the GOP shoved down our throats.

The webinar, “Healthcare without Borders: The Opportunities and Challenges of Medical Tourism”, was an almost ninety minute, four-part presentation given by two Managing Directors, a Partner, and a Medical Director of a Mexican hospital system.

The presenters were Jon Glaudemans, Managing Director of Manatt Health Solutions, Andrew Rudman, Managing Director of Manatt Jones Global Solutions, Linda Tiano, Partner with Manatt, Phelps & Phillips, LLP, and Dr. Alfonso Vargas Rodriguez, Medical Director of Hospitales H+.

While the focus of the middle of the presentation dealt with conducting medical tourism in Mexico, the information presented by Mr. Glaudermans was concerned about the trends in healthcare that are pointing to greater demand for medical tourism, and are elaborated in the following graphic:

Megatrends

Source:  2016+Medical+Tourism+Deck.pdf Manatt, Phelps & Phillips, LLP

Here are the key points from Mr. Glaudemans’ presentation slides:

  • Consumers pay more and make more care decision, using social
    media/apps to acquire price/network data.
  • Providers take risk for population/patient/product outcomes, requiring new care models and contracts
  • Care monitoring and delivery move out of traditional settings, shifting the locus of/focus on patient loyalty
  • Providers and payers consolidate to manage costs and enhance power, fighting for CM (care management) space
  • States become more active regulators and purchasers, creating marketplace mosaics and more “experiments”
  • Data on health status and effectiveness become widely available, changing practice and payment patterns
  • Bigger datasets yield insights, informing personalized care and challenging price-setting and patient privacy
  • Employers’ role continues to erode, while exchange plans sharpen focus on multi-year patient loyalty
  • Digital natives’ and baby boomers’ interests coalesce, forcing focus on new ‘late-life/end-of-life’ care models
  • Visibility into global pricing and care models improves, requiring providers to justify value and pricing
  • Social determinants accepted as major cost driver, leading to increased focus on service integration

Naturally, many of these megatrends will not pertain to workers’ comp, but given the fact that comp sometimes follows the lead of healthcare, it is not out of the realm of possibility that some of these trends will be felt in medical care for workers’ comp.

Andrew Rudman’s presentation focused on what medical tourism is, and why Mexico is an ideal medical tourism destination for Americans. The main thrust of his presentation is the proximity to the US, the flight times between major American cities and those Mexican medical tourism destinations he focused on in the discussion.

Mr. Rudman also provided a cost comparison chart between US and Mexican costs of certain medical procedures, which is shown below.

Cost comparison 2012

Source:  2016+Medical+Tourism+Deck.pdf Manatt, Phelps & Phillips, LLP/PROMEXICO

Dr. Rodriquez discussed how Mexican doctors become certified in their sub-specialties and how they get re-certified once they are certified by their respective boards. In addition, he showed slides about the various hospitals in the Hospitales H+ system, and for our purposes here, outlined the price differential for certain orthopedic surgeries at the various hospitals in their system versus that of the US.

Ortho surgery prices

Source:  2016+Medical+Tourism+Deck.pdf Manatt, Phelps & Phillips, LLP/Hospitales H+

Lastly, Linda Tiano covered the legal issues of medical tourism, and those of you who have been reading this blog for three years, know that my original paper covered some of these issues, and I raised them in my presentation in Reynosa, Mexico in November 2014.

Here are the key points Linda made regarding medical tourism benefits.

Medical Tourism Benefits

Source:  2016+Medical+Tourism+Deck.pdf Manatt, Phelps & Phillips, LLP

3rd Party Facilitator

Source:  2016+Medical+Tourism+Deck.pdf Manatt, Phelps & Phillips, LLP

Liability issues

Source:  2016+Medical+Tourism+Deck.pdf Manatt, Phelps & Phillips, LLP

HIPAA

Source:  2016+Medical+Tourism+Deck.pdf Manatt, Phelps & Phillips, LLP

State Regs

Source:  2016+Medical+Tourism+Deck.pdf Manatt, Phelps & Phillips, LLP

At the end, I asked the question, “do you see the possibility of implementing medical tourism into workers’ comp, and what are the legal issues with that?” Ms. Tiano mentioned the state-specific laws regarding workers’ comp, and said that the workers’ comp industry is way behind health care, to which I heartily agreed.

So you can see from this brief, but thorough review of the presentation, that medical tourism is a serious research area for many interested parties. Yet, you guys in work comp refuse to see, hear or speak about the truth of what is happening around you. So here is another picture for you.

hear-no-evil-see-no-evil-speak-no-evil

This is the workers’ comp industry on the subject of global health care and medical tourism…three deaf, dumb and blind monkeys clinging to the same old statutes, laws and regulations that haven’t changed since the days of Taft and Wilson.

So when are you going to catch up to the rest of the world, and to the globalization of health care? In the 23rd century? When are you going to admit to yourselves that automation, new technology, the Internet of Things, telemedicine, etc., are going to make you guys OBSOLETE… to borrow a term from “The Twilight Zone”.

I have a vision for the future of medical care in workers’ comp. What you have is the same old, same old, and expecting different results. That’s not only crazy, that is doing a disservice to the people workers’ comp is supposed to be for, the claimant.

But suit yourselves…the dinosaurs are waiting to greet you.

 

 

 

Satori Files For Bankruptcy: What that Means for Medical Travel

As reported last month by US Domestic Medical Travel.com, Satori World Medical, Inc., a company based in San Diego, filed for bankruptcy.

When news of this story broke, I inquired with my contact at US Domestic Medical Travel.com to learn what this meant for the patent Satori had taken out that had a chokehold on the growth and development of the medical travel sector, both domestic and international.

Her reply was that she was not sure, so I looked up what happens when a company goes bankrupt. Most of the information concerned companies who manufactured products and what happens to the patents to those products after a bankruptcy. The gist of what I found was that they transfer to the receivers/liquidators.

But since Satori’s patent is for an idea, and not a tangible asset like manufactured goods or inventory, I doubt the receivers/liquidators for this action would be willing to take this asset. What would they do with it?

So, instead of wondering, because that may be a fruitless exercise, let’s look at what the patent was all about, what it allowed and did not allow, and then you can decide how best to model your business plan going forward.

The Satori patent, trademarked as the “Health & Shared Wealth Program”, is actually two patents; the first, U.S. Patent 8160897, titled the “Satori Integrated Health & Financial Benefits System and Method” and U.S. Patent 8224668, a Continuation-in-Part to Patent No. 8162897.

They are part of a portfolio of other patents of intellectual property that regard the calculating and sharing of the dollar savings from a medical travel health benefit. The patents provided Satori with exclusive rights to the only permissible medical shared savings model in the medical travel industry.

I know what you all are thinking, how can anyone patent an idea such as this? Isn’t this restraint of trade, you may wonder?

Well, as I am not a patent attorney, nor an intellectual property expert either, I would think not, except that was the case before the bankruptcy.

As Satori’s own website states, the Health & Shared Wealth Program supports organizations by lowering their cost structure for health benefits by providing plan members with a highly-valued benefit option at no cost to the plan sponsor or members.

The parent patent, they continue, is a system and method that calculates the savings generated when a patient selects medical care outside the US.

It waves all co-pays, deductibles, and/or co-insurance, making the selection of outbound medical care a 100% medical benefit for the patient. In addition, it shares the savings between the patient and the insurer/employer.

I want to stop here in the explanation of the patent to tell you my idea, and why this patent seems to me to be a restraint of trade issue and a virtual monopoly.

My idea was to implement medical travel into workers’ compensation in the US, and along the way, after writing my paper on the subject, and this blog, I learned from other individuals that the best way to do so was to offer an financial incentive from the savings to the claimant/patient from either his employer or insurance carrier.

At the same time, I learned from one individual, that in order for this to be advantageous, the savings had to be greater than $5,000 for medical care received outside the US. So for example, if a knee surgery in the US cost $30,000, in order to convince an employer or insurance company of the efficacy of outbound medical travel, the cost of that knee surgery would have to be $25,000 or less.

How much the claimant/patient would receive and when and how they would receive it is a matter of discussion. It could be a percentage of the savings, a flat-rate of say, $2,000 or $2,500, or come from the overall settlement of the claim, but that could take years to realize.

Returning to the patent, the Health & Shared Wealth Program, Satori states, precludes certain entities such as medical travel/medical tourism facilitators (I bet you are hoping mad at this point; I sympathize), health plans, self-funded and fully insured employers, Taft-Hartley trusts (labor unions), unions, workers’ compensation carriers (this got me mad), municipalities, pension plans, etc., from offering any shared savings model similar to the one described above to their clients and/or plan members without written permission from Satori (now you must be steaming!!!!).

So, what does this mean? If Satori is out of business, we can all take a sigh of relief that now the wicked witch of the west (Satori) is dead. What comes next is up to you. Prior to the announcement, there were ways to get around the patent’s restriction. Now, that may not be necessary.

My suggestion is get yourselves some good IP attorneys to see if you are good to go, and if you are given the green light, adjust your business model and plan accordingly. You will only benefit from the fall of the house of Satori.