NY Daily News: Fire Fenster
October 23, 2012 [5357]: Bill Hammond, political reporter for the New York Daily News, has just written an opinion piece agreeing with what I have been writing for over a year:
Fire Jeffrey Fenster, the Workers’ Comp Board’s executive director
Hammond writes about the ‘high cost of dysfunction’
at the New York State Workers Compensation Board and then state that as
one of Cuomo’s first acts to make NYS a more attractive place in which
to do business, “He should start with a performance review of the Workers’ Comp Board’s executive director, Jeffrey Fenster.”
The article then goes on to point out the many facts highlighted in this column since Fenster was first appointed
Fenster
was 29 year old, with only four years of work experience as an a
litigation associate with the Manhattan firm of Stroock & Stroock
& Lavan. And he had absolutely no management experience of any kind.
Yet, when looking for an explanation as to why he was appointed to
“lead a notoriously sluggish bureaucracy with more than 1,400 employees
and a budget of $200 million:, it was noted that he key, in fact sole,
qualification was his personal relationship with then-Brooklyn
Democratic boss and Assemblyman Vito Lopez.
May
this Daily News article added to the one by James Odata of the Albany
Times Union and my many critiques of Board management will be the straw
that breaks the camel’s back.[2A201-5357]
WCRI: 2007 Amendments
Do Work ... Partially
October 10, 2012 [5356]: A study by the Workers Compensation Research Institute (WCRI) shows that the 2007 reforms have had a positive impact.
The study
pointed out that as a result of the increase in maximum statutory
benefits, these increases in maximum weekly benefits have brought New
York closer to national norms and reduced the percentage of workers
whose benefits were limited by the maximums.
The
study also reported that the implementation and subsequent change of
the pharmacy fee schedule resulted in decreasing the average price per
pill by ten to 20 percent.
However,
the study did not review the increased length of time that it takes the
New York State Workers Compensation Board to issue a decision on
request for medical variances nor on the delays encounted by those
seeking a review of an administrative law judge decision. Thus it can be
assumed that an increase in maximum benefits could well be offset by
the months or years before the injured workers actually receives them,
if is that increase which is subject to an appeal.
It
is noted that this report by the WCRI did not review any internal
procedural changes required by the 2007 Amendments but just those
aspects of changes in the law that are take place in the system but are
outside the control of the Board.
WCB Special Fund’s Bonds get AA+ Rating
October 8, 2012 [5355]: Fitch
Ratings has affirmed the “AA+” rating which is in effect for the bonds
issued by the NYS Dormitory Authority on behalf of the New York State
Workers Compensation Board which are to be used to settle claims related
to the Special Disability Fund in the state's workers' compensation
program through lump sum settlements to individual injured workers. The
financing program was developed to reduce the volatility and cost of
workers' compensation insurance coverage, which is mandatory for New
York employers, although the size of issuance is well below the levels
originally expected.
This report gives details on the bonds, how the security rating was determined, and background on the finances of the bonds.
New NYSIF Billing Program
October 09, 2012 [5354: New York State Insurance Fund (NYSIF) has selected iHCFA for Electronic Billing Services.
iHCFA is to provide state-of-the-art processing for the electronic
submission of medical bills and supporting documents to NYSIF for 5
years. This program purports to validate the submission of bills and
expedites payments to medical providers, reducing more than 50% of phone
calls inquiring about the status of bills.
iHCFA
was the first company in the industry to be certified by the New York
Workers’ Compensation Board as an EC-4 NARR XML Submission Partner and
is the only company certified by the NY Workers’ Compensation Board to
submit the Ancillary Medical Report (AMR) electronically to the Board.
NYSIF a Winner
October 15, 2012 [5353]: The
American Association of State Compensation Insurance Funds (AASCIF)
announed that the New York State Insurance Fund has won a number of
awards for its publications. The AASCIF is an association of workers'
compensation insurance companies from 26 different states, plus 8
workers' compensation boards in Canada.
With judging done by the Public Relations Society of America – Colorado Chapter, NYSIF won:
- Excellence in Writing: First Place - NYSIF Workers’ Comp Advisor First Quarter 2012
- External Brochure: Third Place - NYSIF Online Service
There were a total of 13 categories. The overall winner was the Texas Mutual Insurance Company - Pinnacol Assurance.
-- Bulletin --
New Chairman for NYSIF
October 5, 2012 [5352]:The
New York State Insurance Fund has a new ‘acting’ chairman: Sidney
Holmes III. The change in the first page of their web site is so new
that at this time, the link for his name does not connect to anything but he is listed as a Corporate Partner at Winston & Strawn LLP.
Donald
T. DeCarlo, a registered Republican, who was the chairman and a
registered Republican has had his name removed for the site.
Details to follow as soon as they are available.
NYIA Calls NY WC Rate Market 'Defective
September 26, 2012 [5351]: The workers' compensation market in New York state is "defective," said Ellen Melchionni, president of the New York Insurance Association. "Workers'
compensation rates have been artificially suppressed and only compound
the problems with a system that is already deficient.”
One problem plaguing the market is the New York State Insurance Fund, which was created as the market of last resort, but "in actuality is not,"
Melchionni said. She said the state fund is able to offer reduced rates
because of unfair competitive advantages, such as a reduced assessment
and not paying agent commissions. The state fund "routinely writes business that could be readily placed within the voluntary market."
Brian
O'Larte, senior financial analyst with A.M. Best Co. Noted that the
economy is also an issue for workers' comp writers nationally, O'Larte
said. "One of the keys to workers' comp is getting the injured worker
back to work. But a lot of injured workers don't have a job to go back
to."
Another
issue impacting the workers' comp market in New York is the premium
assessed to fund the workers' comp system, Melchionni said. Thirty-one
states use a premium tax or assessment to fund their state systems,
according to a study by the Workers' Compensation Policy Institute. As
reported in this website last week, New York’s surcharge is nearly five
times the national average.
Full
details on these points can be found in the complete press release,
written by Meg Green, senior associate editor, BestWeek (Meg.Green@ambest.com) at BestWeek’s web site at:
fpn.advisen.com/articles/article1851974761522624597.html
NYS WC Tax/Assessement US’s highest
September 10, 2012 [5350]: A
surcharge added to workers' compensation costs for all New York State
employers remain the nation’s highest. It is nearly five times the
average of the same surcharge imposed in other states, according to the
annual study conducted by the Workers' Compensation Policy Institute.
New
York’s 18.8 percent surcharge is more than double the 8.3 percent tax
in Minnesota – the state with the second highest surcharge. These
surcharges, called assessments, are essentially a tax on workers’
compensation premiums and are used by state governments to fund the
system.
The
study made some interesting analyses regarding the implementation of
the 200& Workers Compensation Reform Act which was supposed reduce
costs:
- While
assessments in New York decreased by 6.9 percent in 2012, assessments
nationwide were actually down by an average of 9.5 percent.
- This year’s 18.8 percent assessment is the second highest New York has seen since undertaking reform.
- The
Institute's new analysis shows that assessments are continuing to be a
larger part of increasing costs, and employers pay nearly 50 percent
more of their compensation dollars in assessments to fund the system
than they did four years ago
- A
3.1 percent tax of premium to pay for the state to administer the
Workers' Compensation Board exceeds the total cost of assessments in all
northeastern states except Connecticut.
In
summary, the report noted that the slight relief from this burden
offered this year was not enough to change the fact that New York
continues to have the highest administrative costs in the country.
For further details on or a copy of the report, contact Paul Jahn at the Institute: pjahn@wcpinstitute.org (518-220-1111).
New “Best” Medical Provider List
October 2, 2012 [5349]: Karen Wolf of MedMetrics Health Partners has announced that they now have a Master Provider Index
to enable a quick-search for the best medical providers for Workers’
Comp by specialty and geo-zip directly from the Internet anytime,
including individuals, clinics, and facilities.
However,
in order for Master Provider Index to display only the best medical
providers, MedMetrics applies important technical underpinnings and
analytics. MedMetrics does the technical heavy lifting and analytics so
you can easily find the right doctors, those who are scored best based
on the data. The Index, continually updated, includes three major
technical service components, all critical to the result:
- Technical services
- Medical performance analytics
- Online search
Wolfe
can be contacted at karenwolfe@medmetrics.org to get information on
accessing this database, which is done on a licensing basis.
Board Hires Help to Speed Decisions
September 26, 2012 [5348]: The
NYS Workers Compensation Board is finally taking steps to reduce the
backlog of cases that have been piling up in the Administrative Review
Division’s offices (ARD).
Apparently,
some new writers have been added to the ARD to increase the number of
writers to work on the proposed Memorandum of Decisions (PMODs) that
have been piling up and now average probably 6-8 months rather than the
2-4 months as during the late 1990's and early 2000's.
Equally
important, the Commissioners have been told that they must ‘empty’
their work queues by Friday every week. And the writers who prepare
these PMOD’s have been told that they must follow-up with the
Commissioners who have not done their work and/or report to the
appropriate supervisors (theirs or the Vice-Chair I do not yet know).
While
this does not mean that those commissioners who used to sign their
PMOD’s one a month or so without reading them will now read them, they
will at least follow my admonition listed so many times in this website,
most recently in my New 2012 Legislative Agenda for the Board:
If
you are not going to read the decisions, the main responsibility for
which you have been appointed to review, at least sign them on a timely
basis.
Apparently
the Second Floor (the name used when referring to the Governor’s
offices and his executive staff) has decided, for whatever reason, that
the current state of affairs at the Workers Compensation Board is an
embarrassment and must be corrected.
However,
at this time, I am unable to ascertain if the new writers will be
brought in from another agency or transferred/promoted from elsewhere
from within the Board’s offices. Be that as it may, claimants, carriers,
employers and their respective attorneys should start to feel the speed
up within the next two or three months . . . hopefully.
Cuomo’s Republican Appointees
September 23, 2012 [5347]: James Odato, chief political reporter for the Times-Union, reported that, “When it comes to appointments on some state bodies, it could be argued that Gov. Andrew Cuomo favors Republicans.”
Odato noted that Cuomo’s first appointment to the NY Workers Compensation Board was Republican David Dudley who had served as Bruno's chief counsel and had been the former Rensselaer County GOP Committee chairman.
Cuomo then reappointed to the WCB Board Ellen O'Mara Paprocki,
daughter of John O'Mara, Gov. George Pataki's good friend and one-time
Public Service Commission chief. She was originally appointed in 2001
with her first term expiring in 2008 but, in 2006, she had her term
switched with the term of another commissioner in order to add three
more years to her term in office¹. Then only just a few months after her
term expired on December 31, 2011, she was reappointed to another full
seven-year term. Her brother is recently elected NY State Senator Tom
O’Mara (R-C, Big Flats).
In addition, Cuomo has left a Republican in place as the vice chairman of the WC Board, Frances Libous,
a Pataki appointee, whose husband is Senator Tom Libous (R-C-I:
Binghamton) who serves as the Deputy Majority Leader for the New York
State Senate. Paprocki and Dudley earn $90,800 a year while Libous is
paid $101,600.
At the New York State Insurance Fund, Cuomo appointed as the Chairman of the Board Donald T. DeCarlo,
a registered Republican, who had been on the SIF board from 1997 to
2008, when Gov. David Paterson replaced him and other Pataki appointees.
DeCarlo was voted in as chairman of the SIF board in February at
Cuomo's recommendation. DeCarlo serves without pay.
There are also several other Boards with vacancies and Republic holdovers. The New York State Parole Board has two holdovers, Walter Wm Smith appointed by Governor Pataki and Jared Brown
appointed by Governor Paterson. (Odata says there are five vacancies
but there are 14 seats and the Agency’s website shows 14 board members).
Also, the Unemployment Insurance Appeal Board has one Pataki holdover
and one vacancy.
The
question has arisen as to when Governor Cuomo will fill those spots.
But it is expected that he may use some of them to reward loyal members
of the state legislature, both Republican and Democratic, who have or
may lose their position in the upcoming elections, such as Senator Roy
McDonald (R-Saratoga) who lost in a Republican primary.[29197-5347]
¹For
the record, I was that commissioner that was switched with Paprocki. As
a result, Paprocki got the balance of five years from my term and I got
the two years remaining on her original term of office, thus leaving
the Board in 2008. Other beneficiaries of 'term switching' were Candace
Finnegan and Frances Libous. As to whether or not Cuomo would also
resort to 'term switching' to protect his appointees remains to be seen
but there would be no reason to do so until well into his second term.
New Board “Dead Letter" PO Box
September 17, 2012 [5346]: Under
Subject Number 046-91, NYS Workers Compensation Board Chairman Robert
Beloten announced that all upstate mail, rather than being sent to
individual Board offices, now be sent to the Board’s central mail
processing unit in Binghamton.
In the past, only mail from the New York City area was to be sent to Binghamton.
As Beloten states in the Subject Number, “.
. . , to further improve service and expedite the claims process, the
centralized mailing address in use in the downstate area should now
begin to be transitioned to and used for all claims-related mail for the
entire state.”
The Insider Considering how long is it currently taking for appeals on
administrative law decisions to be issued after the appeals are filed
and how long it takes for medical variances to be reviewed once they are
filed, it seems that the net effect of this new administrative change
is that the Post Office will now be delivering to one ‘dead letter’
address rather than two. Also, since the scanning/mail facility is a
privately owned business, this will increase private sector employment
in Binghamton, coincidentally the home of Vice Chair Frances Libous and
her husband State Senator Tom Libous (Deputy Majority Leader for the New
York State Senate) while possibly giving the Board a rational to cut
public sector staff (mail rooms) at the district offices.
NYS WC Assessment US’ Highest
And three reasons why!
September 14, 2012 [5345]: A report issued by the Workers' Compensation Policy Institute
confirms what everyone thought: New York’s 18.8 percent surcharge is
more than double the 8.3 percent tax in Minnesota – the state with the
second highest surcharge.
This
18.8% surcharge is used to fund the New York State Workers Compensation
Board’s 1550 employee staff and systems is substantially higher than
the average assessment of 32 states: 3.8%. And the Board’s increase in
assessments in 2010 and 2011 were higher than the increases in other
states and the decrease this year, mandated by Governor Cuomo, was less
than other states.
In an article in WorkersCompensation.com, attorney Ted Ronca outlines the three reasons comp in NYS is so expensive:
Reason
#1: Bigger is Better. NYS has by far the biggest bureaucracy, the most
hearings, the most open cases, etc. As Ronca reports, “The number of
hearings was so great that a research institute studying the NY comp
system at first concluded that the number of hearings had an extra zero
added by mistake. (Hearings are currently at 200,000/yr, or less.)”
Reason #2: Second Injury Fund Payments. “What
drove the payments to the highest in the nation was the NY board’s
stunning number claims for 'permanent partial disability'.”
Reason
#3: Reopened Cases. Since so many cases in the New York system could be
closed without awards but then reopened at a later date, more often
than not, as Ronca explains, “When the worker retired, the claim
would be reopened and considered for permanent partial disability
settlement since, it was claimed, the worker had retired in part due to
the disability.”
Although
the Second Injury Fund is being eliminated, the claims still exist but
are paid directly out of the carriers’ pockets rather than having the
carrier pay that same amount of money in to the Second Injury fund who
would then pay the claim.
And
the Board seems to spend most of it time, increasing the paper work
demands on all the panties to a claim while thinking of ways to spend
tens of millions of dollars adding a new computer system to handle the
Board’s ever increasing demands for more paperwork.
The Insider: While the Board has taken steps to increase the number of cases it
closes every year, there has been a substantial increase in the number
of cases being reopened every year. But, more important, if you speak to
all the parties who use the system, claimant issues are not being
resolved and far too often medical treatment (and payments for same)
takes months if not years longer to get resolved. Thus despite all the
‘factors’ that look good in the Board’s annual reports and press
release, the one factor neither measured nor apparently of no concern to
the Board is the human factor: the injured worker.
New Maximum AWW
August 3, 2012 [5344]: Since July 1, 2010, the maximum weekly benefit rate for workers' 
compensation has been two-thirds of the New
York State average weekly wage for the previous calendar year, as
determined by the New York State Department of Labor. Workers'
Compensation Law §§ 2(16);15(6). On April 2, 2012, the Department of
Labor Link to External Website reported to the Superintendent of the
Department of Financial Services that the New York State average weekly
wage for 2011 was $1,188.10. Accordingly, for workers' compensation
claims with dates of accident or dates of disablement during the period
from July 1, 2012 through June 30, 2013, the maximum weekly benefit rate
will be $792.07.
The maximum weekly benefit rates in prior years were:
- 07-01-2011 to 06-30-2012 $772.96 ($1,159.44 NYS Average Weekly Wage)
- 07-01-2010 to 06-30-2011 $739.83 ($1,109.75)
- 07-01-2009 to 06-30-2010 $600.00 ($900.00)
- 07-01-2008 to 06-30-2009 $550.00
- 07-01-2007 to 06-30-2008 $500.00
- 07-01-1992 to 06-30-2007 $400.00
Beloten, Not Legislature, rewrites WCL
August 1, 2012 [5343]: Today, under subject number
150-13, NYS Workers Compensation Board Chairman Robert Beloten announced
the Board’s position on the interpretation of ‘wages’ as defined under
WCL §2(9).
Beloten has proclaimed that “the reasonable value of board, rent, housing, lodging or similar advantage received from the employer”
shall be included in the calculation of average weekly wage if they are
provided by the employer as remuneration for work, labor or services of
the employee in the employment.
Citing Practice Commentaries by Martin Minkowitz, a 1978 Court decision
and a 2006 Board Memorandum of Decision, today’s announcement, per
Chairman Beloten, is an update of Subject Number 150-13 dating back to
July 14, 1988.§§§
Seeing that it has taken Chairman Beloten only 24 years to update this
interpretation of the law, it is no wonder that hundreds of appeals in
the Administrative Review Division take more than one year to be
reviewed.
Yes, the 2012 subject number “150-13", at least in this Board memo, is the same subject number “150-13" as it was 24 years ago.
The Insider
