Latest Developments
- Colorado insurer may have incentivized employees to deny workers comp claims.
The AP (9/3, Paulson) reported, "A workers compensation insurer may have paid bonuses to employees for denying claims, a lawmaker said Thursday, citing documents provided by the company. State Sen. Morgan Carroll, D-Aurora, said that documents indicate Pinnacol Assurance paid bonuses to claims adjusters and doctors based on performance standards that included net income targets." Carroll "said employees were rated on how fast they disposed of claims, giving claims adjusters an incentive to dismiss them."
- Two companies indicted in Colorado workers' deaths.
- The AP (8/28, Banda) reported, "Two companies and two executives accused in the deaths of five workers in a 2007 fire inside a tunnel at a Colorado hydroelectric plant have been indicted on federal charges. Xcel Energy, RPI Coating Inc. and two RPI executives face criminal charges in the deaths in a federal indictment that alleges they knew about the danger and did nothing about it." Previous events, "including multiple evacuations due to high levels of carbon monoxide and damage to electrical equipment, made the companies and RPI executives aware that employees faced serious health and safety hazards working in the tunnel, the indictment said."
- The Minneapolis Star Tribune (8/28, Alexander) reported, "The October 2007 fire at Xcel's Cabin Creek Hydro Plant, in the mountains near Georgetown, Colo., occurred during the renovation of a large empty metal pipe down which water normally flowed to create hydroelectric power. Five employees of RPI Coating were trapped in the pipe when chemicals being used in the renovation caught fire and blocked their only exit." Xcel and Public Service Co. of Colorado "could be liable for as much as $5 million in fines if found guilty."
- Colorado lawmakers investigate Pinnacol.
The AP (8/4, Slevin) reported, "After considering raiding Pinnacol Assurance's $684 million surplus to balance Colorado's budget, state lawmakers are taking a closer look at why the state-created workers' compensation insurer has so much extra money on hand. A legislative committee charged with studying Pinnacol's operations met for the first time Tuesday" to determine "whether injured workers are wrongfully being denied benefits and whether the businesses that Pinnacol covers are being overcharged."
- FDA panel recommends smaller acetaminophen doses, painkiller bans.
The CBS Evening News (4/30, lead story, 3:05, Couric) reported, "An FDA panel recommended today that prescription Vicodin [hydrocodone bitartrate and acetaminophen] and Percocet [oxycodone and acetaminophen] be banned, and that over-the-counter Tylenol, Excedrin, Nyquil, and Theraflu contain stronger warning labels...The problem, according to FDA advisors, is that they all contain acetaminophen, which can cause liver damage."
The FDA "panel noted that patients who take Percocet and Vicodin for long periods often need higher and higher doses to achieve the same effect," the New York Times (7/30, A1, Harris) reports in a front-page story. "The two drugs combine a narcotic with acetaminophen," and the panel's vote to "recommend a ban on the combination drugs was one of 11 it took" at the meeting. The experts also recommended "that the FDA reduce the highest allowed dose of acetaminophen in over-the-counter pills...to 325 milligrams, from 500," and "to reduce the maximum daily dosage to less than 4,000 milligrams."
The Wall Street Journal (7/1, Favole) notes that the panel "of 37 doctors, pharmacists, and researchers voted on the recommendations Tuesday after spending two days discussing steps the FDA should take to reduce the number of acetaminophen overdoses." Gerald Dal Pan, director of the FDA's office of drug surveillance, said, "Whatever we do on any of these options, it will really affect the whole healthcare system." The agency also noted that the recommendation to pull "from the market a number of prescription products" may "affect 240 pending drug applications."
"But some on the panel opposed a sweeping withdraw of" prescription acetaminophen combination drugs "that are widely used to control severe, chronic pain," the AP (7/1, Perrone) reports. The panel decided that "if the drugs stay on the market, they should carry a black box warning, the most serious safety label available." Notably, "drug companies avoided the most damaging potential outcome with the defeat of [a] proposal to pull NyQuil and other over-the-counter cold and cough medicines that combine acetaminophen with other drugs."
- OSHA fines Wal-Mart over trampling death of employee.
The AP (5/27, Eltman) reports, "The death of a temporary employee who was crushed in a stampede of post-Thanksgiving shoppers at a Wal-Mart store could have been prevented, federal officials said Tuesday as they proposed fining the world's largest retailer $7,000 - as much money as it makes in about 18 seconds." The agency cited Wal-Mart "for inadequate crowd management following the Nov. 28, 2008, death of Jdimytai Damour at a Long Island store." A spokesperson for Wal-Mart said, "Wal-Mart has 'never had a tragedy like this occur in our stores and we never want it to happen again.'"Dow Jones (5/27) reports, "OSHA's inspection found the store's failure to implement reasonable and effective crowd management meant employees could be crushed by the crowd. The failure included not providing employees with training and tools to safely manage the large crowd of shoppers."
- Jury to consider whether Blue Shield of California wrongfully rescinded coverage.
The Los Angeles Times (5/18, Girion) reports that "for the first time, a jury will weigh whether an insurer owes anything to a canceled policyholder" in a case surrounding Steve Hailey, who was dropped by Blue Shield of California "after a disabling car accident." An appeals court "had ruled that insurers should not wait until members are sick or injured before verifying their medical history," and "if an insurer does wait...it loses its chance to cancel coverage unless it proves applicants intentionally misrepresented medical history." The court stated that "a health plan...'may not adopt a 'wait and see' attitude after learning of facts justifying rescission.'" For its part, Blue Shield "contended that it was within its rights to cancel" coverage for Hailey and his wife Cindy because Steve's "true weight" was misrepresented and the application did not include "his medical history, including hypertension and headaches." But, "the Haileys say that Cindy was confused by the application and made an honest mistake when she filled it out, believing it was asking only about her medical history."
- NHTSA upgrades roof strength regulation.
The Detroit News (5/4/2009, Shepardson) reported, "The long-awaited federal upgrade of the 35-year-old regulation governing vehicle roof strength will save 135 lives, prevent more than 1,000 injuries and add up to $1.4 billion annually to the cost of new cars, the Transportation Department said." Transportation Secretary Ray LaHood said, "These new standards go a long way toward reducing deaths, but safety belts are the first, most important step everyone should take to protecting themselves and their families."
- During 2007, property and casualty insurers continued a trend of charging too much for premiums and underpaying claims, leading to an over-charge of about $870 per U.S. Household over the last 4 years. View the complete study and report written by the Consumer Federation of America at www.consumerfed.org/pdfs/2008Insurance_White_Paper.pdf
