Massachusetts Workers' Compensation
Advisory Council Minutes



September 10, 2008
Department of Industrial Accidents
600 Washington Street, 7 th Floor
Boston, MA 02111

Present: Chairman Edmund C. Corcoran, Jr.

CM: Stephen Joyce; Stephen P. Falvey; David P. Powell; John D. Boyle (Teri McHugh); Peter A. Cook, Sr. (Karen Shanley); John Regan; John Pulgini; Dennis Hines; Department of Labor (Tom Jones).

Also Present: DIA: Commissioner Paul V. Buckley; Timothy J. McMahon, Deputy Commissioner of Administration; William Taupier, First Deputy Director of Administration; Yvonne Vieira-Cardoza, Deputy General Counsel; Tom Wielgus, Manager of Civil Litigation Unit; Ellen Keefe, WCRIB; Michael Kelley, AIM Mutual; Anna Lucey, Joint Committee on Labor and Workforce Development; Jennifer Mercandante, Joint Committee on Labor and Workforce Development.

Advisory Council Staff: Andrew Burton; Evelyn Flanagan.

Absent: CM: Vice-Chairman Mickey Long; Tony Frias; Kenneth J. Paradis, Jr.; William Corley; Department of Business Development.






Agenda:

Chairman's Welcome

DIA Update

  • Judicial Update - Martine Carroll, Senior Judge
  • Vital Statistics - William Taupier, Deputy Director of Administration
  • Underground Economy Task Force Update - Tom Jones

Action Items

  • Minutes - August 13, 2008

Civil Litigation Unit - Overview & Highlights - Tom Wielgus, Manager

Executive Director Update

Miscellaneous






CHAIRMAN'S WELCOME

Chairman Edmund C. Corcoran, Jr., began today's meeting at 9:00 a.m. Chairman Corcoran requested that Senior Judge Martine Carroll provide Council Members with the DIA Judicial Update.


DIA UPDATE

Judicial Update
Senior Judge Carroll updated Advisory Council Members on the information contained within the DIA's vital statistic report for September 2008 (see attached). Conference Queue: 308; Hearing Queue: 857; Reviewing Board Inventory: 147; Impartial Exams for FY'09 (to date): 898 (9 waivers); Exam Fees Collected for FY'09: $291,200. In fiscal year 2008 there were 5,187 Impartial Medical Examinations (86 waivers); Exam Fees Collected in FY'08: $1,620,458.

Senior Judge Carroll informed the Council Members that Judges Paul Benoit (AJ), Emily Novick (AJ), and Catherine Koziol (ALJ) have all completed their training and are beginning their caseload. The Senior Judge announced that Judge Dennis Maher (AJ) is scheduled to begin work next Monday. Senior Judge Carroll stated that there was now a full compliment of judges at the DIA.

Senior Judge Carroll stated that although the conference queue is low, it can fluctuate on a daily basis depending on the scheduling cycles and vacations. She also noted that for any case to be continued more than three times, the Judge must receive permission from the Senior Judge.

Stop Work Orders/Caseload Statistics
Mr. Bill Taupier updated Advisory Council Members on the Stop Work Order (SWO) and Caseload Statistics for the month of August 2008 (see attached). The DIA issued 240 SWOs in August 2008 making the total for FY'09 to date at 492. Fine collection for August 2008: $57,600; total fines FY'09: $130,400; SWOs issued FY'08: 1,126; total fines collected FY'08: $437,900; compliance checks for August 2008: 2,614; estimated number of workers now covered by WC insurance as the result of a SWO: 1,126 (FY'09).

Mr. Ray Marchand, Director of Investigations, explained that the DIA will perform a follow-up on companies that were issued a SWO every 120 days to ensure that the company is still in compliance. Mr. Marchand stated that when a workers' compensation policy lapses, the WCRIB sends a notice to the DIA informing them that the company is no longer insured.

CM David Powell stressed the importance of having a mechanism in place to validate that businesses remain in compliance after receiving a SWO.

Council Member Stephen Joyce stated that he has heard from many in his industry that more companies are coming into compliance with the workers' compensation statute. He attributed this positive change to the new Task Force and the aggressive SWO changes made by the Office of Investigations.

Ms. Ellen Keefe, WCRIB, informed the Council Members that the Bureau is providing the DIA with statistics showing a notable increase of workers' compensation applications. Ms. Keefe stated that they noticed this increase when the Office of Investigations changed their procedures.

Mr. Taupier continued the update of the monthly vital statistics. Total number of cases filed in August 2008: 1,140; total number of cases filed in FY'09 (to date): 2,352; total number of cases filed in FY'08: 14,464; total number of First Report of Injury Forms (FRI) filed in August 2008: 2,489; total number of FRI filed online in August 2008: 693 (28%); total number of FRI filed in FY'09 (to date): 5,013; total number of FRI filed in FY'08: 32,794; total number of FRI filed online in FY'08: 9,199 (28%).

Mr. Taupier stated that the DIA is projecting that online batch filing will begin in December 2008 after final testing and the completed construction of the system. Mr. Taupier mentioned that once the DIA has completed testing, the DIA will communicate to all parties the introduction of the new system. Mr. Taupier informed the Council Members that the agency has enlisted the services of Judge MacDonald to test the use of laptops in the court room. Mr. Taupier stated that he would provide quarterly updates on the progress that Judges make with integrating laptops into the court rooms.

Mr. Taupier proceeded with his update on uninsured claims (§65). Total number of §65 claims processed in FY'09 (to date): 30; total amount of §65 claims paid by the Trust Fund in FY'09 (to date): $536,605; total number of §65 claims filed in FY'08: 172; total amount of §65 claims paid by the Trust Fund in FY'08: $6,866,127.

Mr. Ray Marchand informed the Council Members that one of the first duties delegated to him by Commissioner Buckley was to review the Trust Fund claims to determine which industries most often utilized the Fund and to track the number of repeat offenders who were on the list. Mr. Marchand explained that out of the 222 Trust Fund claims, he had only identified one repeat offender.

Mr. Taupier proceeded with the vital statistics for the Second Injury Fund (§37/37A). Total amount of §37/37A petitions paid in FY'09 (to date): $960,712; total amount paid on these claims in FY'08: $20,725,671; total monies recovered by the Trust Fund in FY'09 (to date): $431,769; total monies recovered in FY'08: $1,202,747; total COLA reimbursements to insurers in FY'09 (to date): $6,505,305; total COLA reimbursements to insurers in FY'08: $4.0 million.

Budget/Personnel Issues
Mr. Taupier reported that as of August 2008, the number of employees whose salary is paid by either the Special Fund or the Trust Fund was 280 (244 DIA employees, 36 WCTF employees).

Office of Education and Vocational Rehabilitation (OEVR) Update
Mr. Taupier presented the OEVR statistics. Total referrals to OEVR in FY'09 (to date): 511; total referrals to OEVR in FY'08: 2,828; total mandatory meetings in FY'09 (to date): 429; total mandatory meetings in FY'08: 2,281; total referrals to insurers in FY'09 (to date): 120; total referrals to insurers in FY'08: 647; total Individual Written Rehabilitation Plans (IWRP) approved in FY'09 (to date): 91; total IWRPs approved in FY'08: 419; total number of Return to Work (RTW) in FY'09 (to date): 20; total number of RTW in FY'08: 163; total number of IWRPs completed with no RTW in FY'09 (to date): 16; total number of IWRPs completed with no RTW in FY'08: 134.

Mr. Taupier stated that the Director of OEVR, Robert Demetrio, has had direct communication with both insurers and adjusters in regards to holding informational conferences. The informational conferences will attempt to explain to all parties how OEVR operates in accordance to the statute. Mr. Demetrio will also explain how to facilitate and advance OEVR in an effort to educate the parties on its benefits.

Underground Economy Task Force Update
Chairman Corcoran introduced Mr. Tom Jones, Deputy Director and Legal Counsel for the Department of Labor. In the absence of Mr. Michael Bradley, Mr. Jones provided the Council Members with an update on the Underground Economy Task Force.

Mr. Jones informed the Advisory Council that the Task Force has held three public meetings around the state and intends to hold two additional meetings in Worcester and on the South Coast. Mr. Jones stated that the biggest issue facing the Task Force is misclassification and the impact it has on all the regions. Mr. Jones asked if Council Members knew of any employers who would be willing to attend upcoming hearings to discuss how the underground economy is affecting their industry.

Mr. Jones stated that there have been three areas of focus during the regional meetings: education, compliance and enforcement. He explained that the Task Force was educating employers so they will understand the governing laws and penalties for non-compliance. He informed Council Members that various state agencies have begun the process of working together and sharing information.

Mr. Jones stated that Mr. Bradley has approximately 300 ongoing complaints consisting of wage issues, misclassification and unemployment insurance fraud. He explained that many of these cases are forwarded to the Attorney General's Office and Department of Revenue for appropriate action. Mr. Jones informed the Council Members that the Department of Labor was in the process of reviewing legislative proposals to enhance the existing laws.

Mr. Jones concluded his update by informing Council Members that the next public Underground Economy Task Force Hearing is scheduled to take place on Monday, September 22, 2008, at 9:00 a.m., at Quinsigamond Community College in Worcester. Mr. Jones noted that Lieutenant Governor Tim Murray and the Director of Labor George Noel would both be speaking at the hearing.

Senior Judge Carroll informed the Council Members that Director Noel will be a keynote speaker at an upcoming MCLE meeting in November to discuss the work of the Underground Economy Task Force.


ACTION ITEMS

Chairman Corcoran asked for a motion to accept the Minutes for August 13, 2008.

Motion made to accept the Minutes for August 13, 2008.

MMS - Passed.


CIVIL LITIGATION UNIT - OVERVIEW & HIGHLIGHTS

Chairman Corcoran introduced Attorney Tom Wielgus, Manager of the Civil Litigation Unit. Attorney Wielgus provided the Council Members with an overview of the unit.

Attorney Wielgus informed the Advisory Council that the agency has one full-time attorney solely working on civil litigation matters and approximately nine other attorneys working on both civil litigation and workers' compensation cases. He stated that the agency currently has 200 civil litigation lawsuits pending. Attorney Wielgus reported that there was a 16.4% increase in settlement amounts in FY'08.

Attorney Wielgus explained that the DIA no longer writes off claims that are in default status as was practiced in the past. He reported that 60% of the money received on these cases was a result of resolution at the Board Level, while the remaining 40% cases are pursued through civil action. Attorney Wielgus stated that if a case goes into collections, the case will be filed in Superior Court, District Court or go through the supplementary process.

Attorney Wielgus stated that the Civil Litigation Unit employs many different tools for collection purposes. He noted that a lawsuit could be filed against the owner of a company, a corporation, or the individual corporate officers. To enhance collection efforts, the Unit can attach property to the case - both real estate and personal property. Attorney Wielgus informed the Council Members that the DIA possesses two very good databases, known as Accurit and PACER. The Accurit database can effectively locate employers and verify their assets and history, while the PACER database monitors bankruptcy filings.

Attorney Wielgus stated that the Unit encounters various obstacles to the collections process. He explained that many times the employer may have limited or no assets or will file for bankruptcy protection. Attorney Wielgus noted that problems also develop when claims are severe (death cases, spinal cord injuries, brain injuries) and the compensation payout becomes disproportionate to the assets available for recovery. He stated that another obstacle the Unit faces is determining an employee's proper relationship with the employer under the independent contractor law.

Attorney Wielgus explained that the job of the Civil Litigation Unit has been made easier with the acquisition of the Time Matters database. The database contains all of the documentation pertaining to the case, including billing information, notes, legal proceedings and the amount of time the attorney worked on the case. He stated that according to the law the DIA has the statutory right to collect attorney fees at market rate.

Council Member John Pulgini suggested that the DIA, as a state agency, could legislatively circumvent the Homestead Law. Mr. Pulgini also suggested that the DIA notify mortgage companies to ensure that employers do not transfer property.


EXECUTIVE DIRECTOR UPDATE

Executive Director Burton reported that the Advisory Council currently has one vacant position (vocational rehabilitation) and four membership positions with expired terms. Mr. Burton explained that he has been working with the Department of Labor to have these positions filled.

Executive Director Burton informed the Advisory Council that during last week's WTKK radio show, "Ask the Governor," Governor Patrick received a call from an injured employee who was unable to find a doctor willing to perform a knee surgery due to the inadequacy of the Workers' Compensation Medical Fee Schedule. Although specifics to the case are not known, the Executive Director stated that the caller's dilemma reinforces the ongoing concern of the Advisory Council that there needs to be a Fee Schedule Task Force that can promptly react when areas of the fee schedule become unrepresentative of system costs. The Executive Director reminded Council Members of the 2006 WCRI study that identified "major surgical procedures" as being the area in the fee schedule where surgeons were consistently being paid above the state mandated rates. Mr. Burton stated that he has been communicating with the Division of Health Care Finance & Policy (DHCFP) with respect to the rates.

Chairman Corcoran stated that this was a major issue and that he is hoping that the DHCFP will soon address these rates at a hearing. The Chairman also referred to a Fee Schedule Task Force that was created in Rhode Island and stated that this type of mechanism seems to be working well for that state. Chairman Corcoran stated that he would like to see the best medical care provided for injured employees, thereby allowing them to return to work sooner.

Executive Director Burton reported that he would be organizing an Injury Reporting Subcommittee in the next couple weeks. Mr. Burton explained that Council Member Stephen Falvey had suggested the Advisory Council look into ways to improve injury reporting compliance in the Commonwealth. Mr. Burton suggested that any members who are interested in serving on this subcommittee should notify him after the meeting.


MISCELLANEOUS

Chairman Corcoran asked for a motion to adjourn the meeting.

Motion made to adjourn the meeting.

MMS - Passed.

The next regular meeting of the Advisory Council is scheduled for Wednesday,
October 8, 2008, at 9:00 AM, at the Division of Industrial Accidents, 600 Washington Street, 7 th Floor Conference Room, Boston, MA 02111.