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Archive for the ‘Office of Workers’ Comp’ Category

Bobby Jindal and former Director of the Louisiana Office of Workers Compensation (OWC) Wes Hataway are gone but a court decision late last month could represent a legal smack down of the way workers’ compensation claims have been handled since July 13, 2011, Jindal’s third year in the governor’s office.

The ruling by 19th Judicial District Judge Don Johnson takes direct aim at a law pushed through the Louisiana Legislature and which set up new medical treatment guidelines for injured workers which plaintiffs said violated the due process clauses of the state and federal constitutions.

In his WRITTEN REASONS FOR JUDGMENT, Judge Johnson struck down provisions which:

  • Stipulated that when a carrier/self-insured employer fails to return LWC forms within the five business days it is deemed to have denied such request for authorization;
  • Provided an automatic “tacit denial” of medical treatment;
  • Allowed OWC to enforce variances from medical treatment guidelines;
  • Denied treatment not covered by medical treatment guidelines;
  • Allowed the OWC a workers compensation carrier to arbitrarily submit—and the OWC medical director to accept—any information it desires without notifying the injured worker of the “evidence.”

The suit was brought against the Louisiana Workforce Commission (LWC) in 2013 by attorney Janice Hebert Barber and several physicians and injured workers who were denied benefits under the new law. Baton Rouge attorney J. Arthur Smith III represented each of the plaintiffs. Also named as defendants were LWC Secretary Curt Eysink, Hataway, and former OWC Medical Director Dr. Christopher Rich.

Barber said the regulations also discriminate against injured workers in that:

  • Medical benefits were denied to injured workers because their physicians could not return calls from Rich’s staff as quickly as they liked;
  • One request for medical treatment was denied because the injured worker’s attorney submitted too many pages of records to Rich;
  • Another request for treatment was denied because the case itself was 12 years old;
  • Numerous requests for treatment were denied because Rich claimed they were submitted by “bad doctors” who were “bad” only because they were too favorable to their patients, in Rich’s opinion;
  • Requests for medical procedures were denied on the basis of who owned the medical equipment which would be utilized for the procedure;
  • As of December 2012, Medical Director Rich had approved only 14 percent of all requests for medical treatment of injured workers in cases where compensability had already been determined;
  • Rich had denied requests for medical treatment in cases in which he never even spoke to the claimants;
  • Hataway repeatedly engaged in ex parte communications with attorneys and others representing workers compensation insurance carriers and self-insured employers;
  • Hataway and his staff repeatedly expressed the Jindal administration’s “positions” on issues to be litigated by workers compensation judges to the judges themselves.

Barber said in her lawsuit that the new regulations had “enriched workers’ compensation insurance carriers and has harmed injured workers in Louisiana.” She claimed that under the new regulations, the Louisiana Workers’ Compensation Corporation (LWCC), the state’s largest workers’ compensation carrier, more than doubled premium dividend payments to Louisiana employers than were paid the year before the new law went into effect.

When Jindal named his four nominees to the University Medical Center Management Corp. Board back in March of 2010, he not only was looking after some of his more generous campaign contributors, but he also placed one of them in a position of potential conflict of interest.

At the time of his appointment as medical director, Dr. Christopher Rich of Alexandria currently held three separate contracts with the state totaling more than $3.3 million and he had already run into ethical problems with one of those contracts.

Rich also was named by Jindal as one of four nominees for the proposed billion-dollar University Medical Center that was to serve as a replacement for the 70-year-old facility that was closed after its basement was flooded during Hurricane Katrina in 2005.

Like many of Jindal’s high-profile appointees, Rich, his wife Vickie and business partner Dr. Mark Dodson, also of Alexandria, combined to contribute $9,500 to Jindal’s campaigns in 2007, 2010 and 2011.

Rich had a $516,646 contract to serve as Medical Director of the Office of Workers’ Compensation (OWC) Administration that called on him to approve or disapprove medical treatments and procedures for the Office of Workers’ Compensation.

That contract is actually to Chrickie Investments, a company owned by him and his wife.

In 2009, the Louisiana Legislature passed a law which changed the process for determining whether or not medical treatment was “medically necessary.” If a workers’ comp insurance company denies a treatment request, the denial is referred to the OWC medical director, in this case, Rich.

Though the law was passed in 2009, problems with implementing the rules to enforce the new law delayed the actual enactment date of the law until July 13, 2011.

Rich testified before the House Labor Committee that he was “denying 80 percent” of all treatment requested.

At the same time he was contracted to be the sole determiner of all medical treatment for Louisiana’s injured workers, he and Dodson were partners in Louisiana Ortho Services which held a $2.3 million contract to provide orthopedic services for the state, specifically Huey P. Long Medical Center.

Huey P. Long Medical Center (HLMC) at the time was one of 10 state hospitals that made up the LSU Health Care System which is administered by the LSU Board of Supervisors which also oversees the University Medical Center Management Board on which Rich sits. HLMC was subsequently shut down by the Jindal administration.

Because he also owned an interest in Central Louisiana Surgical Hospital which also provided medical treatment to injured workers, the question of his eligibility to make decisions on medical treatment which could financially impact the hospital as well as Mid-State came before the Louisiana Board of Governmental Ethics on separate occasions.

In March 2011, the ethics board ruled that Rich was prohibited, in his capacity as Medical Director of the Office of Workers’ Compensation, from participation in any matter involving Central Louisiana Surgical Hospital.

In January 2012, however, a second opinion said there was no conflict since he had terminated his relationship with Mid-State—only six months since the state had awarded Louisiana Ortho, that $2.3 million contract. Though he no longer is affiliated with Mid-State, he remains a partner in Louisiana Ortho with Dodson who in turn remains as a partner with Mid-State. The timing and the connections, to say the least, are curious.

Rich and Dodson also were partners in a company called ACTIVEMED, Inc., which held a $523,000 contract to provide orthopedic medical services to Northwestern State University student athletes.

Activemed also provided secondary insurance, also known as a preferred provider network (PPN) for two Louisiana university college sports teams and athletes. Basically, the athletes’ primary health insurance is the first payor for sports-related injuries. Then, if the student treats with an Activemed provider and they are enrolled with Activemed, then Activemed picks up the tab for the remainder of the treatment.

This means that Drs. Rich and Dodson had direct control over which doctors Activemed refers injured students to and if those same doctors happen to treat any Louisiana workers’ compensation patients, there existed a potential conflict of interest for Rich.

Activemed’s internet web page contains no list of medical providers, nor is Activemed listed under the Louisiana Department of Insurance either as an insurance company, a third party administrator (TPA), or an adjusting company.

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“My service as vice chair of the Labor & Industrial Relations Committee in no manner alters my duties or the constraints placed upon me under the Code of Governmental Ethics.”

—State Rep. Chris Broadwater (R-Hammond), in an email letter to LouisianaVoice last year. Broadwater, former Director of the Louisiana Office of Workers Compensation (OWC), took a job in 2010 with a company that was awarded a $4.2 million contract by OWC only weeks before his resignation.

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The vice chairman of the House Labor and Industrial Relations Committee who once oversaw the Louisiana Workforce Commission’s (LWC) Office of Workers Compensation (OWC) went to work for a consulting firm within weeks of his office’s awarding a $4.2 million contract to the firm, LouisianaVoice has learned.

State Rep. Chris Broadwater (R-Hammond) served as OWC director and concurrently as interim executive council for the executive director of the LWC, previously known as the Department of Labor.

He announced his resignation as OWC Director in an email to a number of recipients on Oct. 28, 2010, with his resignation to become effective on Nov. 12, 2010.

A $4.28 million contract with SAS Institute to deploy a contractor-hosted fraud detection software platform was approved on Oct. 7, just three weeks before his resignation. The contract was made retroactive to Aug. 31, 2010 and expired on Aug. 30, 2013.

“Today I have tendered my resignation as the Director of the Office of Workers Compensation, effective Nov. 12, 2010,” his email said. “I will be returning to the private sector to work primarily in the area of governmental relations.”

A LouisianaVoice story last July said that Broadwater resigned in February of 2011 but the email, which surfaced just last week, indicates he left OCW three months prior to that. https://louisianavoice.com/2013/07/10/vice-chair-of-house-labor-committee-represents-insurance-clients-before-office-of-workers-comp-that-he-once-headed/

He went to work for the Baton Rouge law firm of Forrester and Dick and his curriculum vitae linking him to SAS later appeared as part of an SAS application for a contract with the state of Minnesota. WorkersCompSAS (PAGE 29)

That CV cited his work with Forrester & Dick since 2010 and touted his work with LWC from 2008 to 2010, his serving as Chairman of the Governor’s Advisory Council on Workers’ Compensation and as Chairman of the Louisiana Workers’ Compensation Second Injury Board during that same time period.

Broadwater was first elected to the Louisiana House of Representatives in 2011 and was immediately made vice chairman of the House Labor and Industrial Relations Committee. Last October, he appeared on a video in which he hyped the services of SAS Institute during its Business Leadership Series in Orlando. http://www.allanalytics.com/video.asp?section_id=3427&doc_id=269491#ms.

LouisianaVoice over the past week twice sent emails to Broadwater asking who paid his travel, lodging and meal expenses for attending that Orlando conference. Those emails read: “Rep. Broadwater, could you please tell me if you attended the SAS Business Leadership Series event in Orlando last October and if you did, who paid your travel, registration, lodging and meal expenses?”

Read receipts indicate he opened both emails, but he never responded.

In a four-minute video made during the leadership conference, Broadwater provided a background in problems OWC was having with fraudulent claims and the decision to contract with SAS. He said the firm “was able to take a state that was data rich and solutions poor and compile all of that data in a single location so that we could then have multiple applications.”

In the video, he said that while Louisiana has used SAS to address fraud, “we’re starting to move into an area in Louisiana where we evaluate our accounts receivable. “In Louisiana we had about $8 billion in outstanding accounts receivable that were less than five years old. When we’re running an annual deficit in our budget of about $1.5 billion, it makes sense instead of raising taxes or eliminating some tax credits or tax for businesses that drive the economy or cutting services to existing citizens, let’s go collect the money that’s owed to us anyway.”

Broadwater also represents three clients, Qmedtrix ($275 per hour), the Louisiana Home Builders Association, and LUBA Worker’s Compensation ($135 per hour each) in matters pending before his old agency, according to documents filed with the State Board of Ethics in December of 2012.

Moreover, Broadwater has attended meetings between Qmedtrix and Wes Hataway, his successor as director of OWC, to discuss the disposition of numerous cases involving Qmedtrix. Those discussions centered around efforts to get the cases stayed and transferred to another judge, according to supervisory writs filed with the Third Circuit Court of Appeal in Lake Charles last March in the case of Christus Health Southwest Louisiana, dba Christus St. Patrick Hospital v. Great American Insurance Co. of New York.

That writ application concerns procedures and conversations which took place involving numerous pending workers’ compensation cases. “In what may be the pinnacle of irony,” the writ application says, “Mr. Broadwater actually disclosed this ex parte meeting on his state ethics disclosure form.”

The writ application cited Broadwater’s own comment from the disclosure form: “Met with Director of OWC discussing process of resolving disputes over medical billing.”

Broadwater admitted to meeting with Hataway “three or four times in person” (always with a Qmedtrix attorney present) and speaking with him 10 or 15 times on the phone.

Broadwater, in an email letter to LouisianaVoice, said he has never received compensation from a private source for the performance of his legislative duties. He said he approaches his duties as an attorney and as a legislator “with humbleness and with the highest sense of honor and ethical behavior.”

He said state statute “prohibits me from receiving compensation from a source other than the legislature for performing my public duties, from receiving finder’s fees, from being paid by a private source for services related to the legislature or which draws substantially upon official data not a part of the public domain.

“My service as vice chair of the Labor & Industrial Relations Committee in no manner alters my duties or the constraints placed upon me under the Code of Governmental Ethics,” he said.

And while technically correct in his assertions, his employment with a state contractor only weeks after approval of that $4.2 million contract and his continued close association with the head of his old agency in discussions of the outcomes of pending cases do tend to bring into question the propriety of his involvement in those matters.

His negotiations with his old agency while simultaneously serving as vice chairman of the legislative committee that oversees that agency coupled with his representation of SAS in Minnesota and in Orlando do seem to suggest a relationship that is less than arms-length and one that at least skirts the edge of serious ethics questions.

And his refusal to reveal the identity of the person or entity that paid his expenses does nothing to alleviate growing concerns over the coziness between public officials and current or former employers. And it certainly does little to foster confidence in the Louisiana Board of Ethics that Gov. Bobby Jindal successfully gutted six years ago.

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