Big Win for Injured Workers in MA: Courts Now Allowing Compensation for Pain and Suffering Damages

On February 12, 2016, the Massachusetts Supreme Judicial Court ruled that, in third-party settlements, workers’ compensation liens will not cover damages for injured employees’ pain and suffering. The compensation for these “noneconomic damages,” which had previously been awarded to workers’ compensation insurance providers, will now be passed on to the workers. The ruling in the case—DiCarlo vs. Suffolk Construction—came as a victory for injured workers, ensuring that workers’ compensation insurance providers may not claim the entirety of a worker’s settlement with a responsible third party.

The Law in Massachusetts

Massachusetts workers’ compensation law entitles injured workers to compensation for medical care and lost wages. However, it does not provide compensation for pain and suffering. In some cases, a worker’s injuries at a workplace occur as the result of negligence by a third party, such as a property owner or contractor. If the third party is responsible for the injury, the injured worker can sue for damages—including compensation for pain and suffering—from the individual or party at fault. In DiCarlo vs. Suffolk Construction, the court ruled that workers’ compensation will not cover the portion of a third-party settlement intended to cover pain and suffering.

What Is the Business Impact of the Court’s Decision?

Third-party settlement amounts are sometimes less than the full amount of a workers’ compensation lien. An injured worker may choose to accept a compromise settlement that guarantees some compensation rather than risking a loss at trial. Prior to the DiCarlo ruling, a workers’ compensation insurance company could reduce its lien and allow an injured worker to keep some portion of a third-party settlement; the law, however, did not mandate such a lien reduction. From now on, an injured worker will now receive the portion of a third-party claim set aside for pain and suffering, with the remainder of the settlement used to defray legal expenses and any workers’ compensation lien.

Agreeing on Fair Distribution

The ruling did not include a formula for allocating compensation for pain and suffering, but the court noted that the amounts must be fair and proportional. Third-party settlements are reviewed by either a trial judge or by the Department of Industrial Accidents; all parties have the right to be heard. As a result of the DiCarlo ruling, compromise must be made in the best interest of both injured workers and workers’ compensation insurers.

About the Author:

John J. Sheehan workers’ compensation law BostonJohn J. Sheehan practices workers’ compensation law in Boston, Massachusetts, where he was born and raised. Mr. Sheehan is a member of organizations including the American Bar Association, the Massachusetts Bar Association, and the Massachusetts Academy of Trial Attorneys. In 1993, John Sheehan graduated from Suffolk University Law School and gained admittance to the Massachusetts state bar.

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Is It Legal for Hospitals to Ban Nicotine-Positive Employees in MA?

In 2011, UMass Memorial Marlborough Hospital adopted a tobacco-free policy for its property. Recently, the same hospital announced that they would be establishing a nicotine-free hiring policy for all new employees as well. Nicotine will join amphetamines, benzodiazepines, cocaine, and others on the list of prohibited chemicals. Hospitals test for these drugs following the interviewing and application process; it is often the last step before an applicant becomes an employee.

umass-memorial-hospitalMarlborough Hospital Leads Nicotine-Free Hiring

According to Steve Roach, president and CEO of Marlborough Hospital, the decision to hire exclusively nicotine-free applicants is meant to encourage employees’ healthy decisions. He expects his employees to abide by the same health advice they give to their patients—to lead by example, essentially. All hospitals in the UMass system have smoke-free and tobacco-free campuses, but Marlborough is the first in the commonwealth to establish a nicotine-free hiring policy.

Is Banning Smokers Illegal?

There is no federal law that protects smokers from these regulations, as the Equal Employment Opportunity Commission does not recognize tobacco smokers as a protected class. However, individual states have their own approaches. Some states say that companies cannot refuse to hire someone simply because he or she is a smoker. Massachusetts is obviously not one of those states. Even some of the states that protect smokers tend to be more strict with the healthcare industry and nonprofit organizations.

Some experts say that this ban will unravel a mess of additional issues. They argue that discriminating against smokers is the same as discriminating against those with diabetes or high cholesterol. There is also the concern that a tremendously well-qualified applicant will be turned away for what some deem to be a trivial issue.

no-smoking-decalMassachusetts Aims to Set Healthy Example

A Swedish study found that smokers take an average of 7.67 more sick days every year than people who have never smoked. Additionally, even if the smoker does not have other medical conditions such as diabetes or obesity, they typically have higher medical costs than the average nonsmoker. If you’ve ever been around a smoker, you know how tightly the smell of smoke can cling to clothing and hair; this new rule will help prevent patients from being exposed to those fumes. Each year, smoking or exposure to smoke causes 443,000 premature deaths and costs over $170 million in healthcare costs and loss of productivity.

Most employees who receive the “quit smoking or quit your job” ultimatum choose to leave tobacco behind. While Marlborough Hospital’s ban doesn’t affect current employees, it will hopefully nudge future employees to kick the habit.

Massachusetts Tanning Ban Has Teens Seeing Red

Massachusetts legislators have initiated a push to make it illegal for teens under the age of 18 to use or operate tanning beds. A bill requiring tanning salon employees and patrons to be 18 or older, An Act Further Regulating Tanning Facilities, was passed without contest in the Massachusetts House last week. Ten states in the US have similar laws already in place, but the current campaign in Massachusetts has been met with some heated debate.

Tanning: A Well-Known Risk

There is no argument against the fact that sunless tanning under high-intensity UV bulbs has been proven to increase the likelihood of certain skin cancers. The risk for melanoma, the deadliest form of skin cancer, increases by 74% when individuals use indoor tanning beds. Studies show that nearly 30% of white female high school students use tanning beds, and 17% use them regularly. According to Senator James Timilty, co-chairman of the public safety committee, much of the UV exposure that leads to skin cancer is incurred in the childhood and teenage years. Diagnoses of melanoma have gone up 200% since 1973.
tan bed 3

Requirements of the Tanning Ban

If successful, the Massachusetts tanning ban would require teens between the ages of 16 and 17 to be accompanied by a parent or guardian. Young adults under the age of 16 will need a “written prescription from a physician” in order to tan—a script not many doctors are likely to ever hand out. The contention surrounding the tanning booth debate centers on what many consider to be an overreach by the “nanny state.”

Under the current state law, teenagers between the ages of 14–17 must present a written copy of parental consent before they are allowed to tan. Adherence to this regulation is predictably inconsistent. Not only can teenagers forge a note from Mom or Dad, but many establishments may not even bother asking for one. If the proposed bill is passed into law, teenagers will need to bring their parents along with them if they want to sun themselves indoors.

Is the Massachusetts Tanning Ban Unfair?

There are those who feel the ban would be an overreach by the state, interfering with a parent’s right to determine what is best for their child. Proprietors of tanning salons have pointed to a potential loss in business as a reason not to pass the new restrictions.

Proponents of the ban claim that banning teens from using tanning beds is a necessary step for ensuring teen health. Is it essential for teens to have access to a luxury service that radically alters their appearance and introduces them to the cosmetic trends of adults? Supporters of the ban believe that setting stricter limits on teen access to tanning is the only responsible option.

Your Turn!

What do you think? Do you allow your teenager to use tanning beds? Why or why not? Comment below.


MA Judge Upholds Sick Time Law

Massachusetts District Court Judge Rya Zobel recently dismissed a complaint filed by two construction contractors, and six construction employee associations, seeking to challenge the Commonwealth’s new sick time law.

The Massachusetts Earned Sick Leave law went into effect on July 1, 2015 following overwhelming support from voters in the fall elections. The legislation requires employers with more than 11 employees to provide up to 40 hours of accrued paid sick time to workers at their “same hourly rate” of pay. Employers with fewer than 11 employees are obliged to provide the accrued time as unpaid leave.

Sick time law don't be your own doctor

An hour of sick time is accrued for every 30 hours worked under the new sick time law, accumulating to up to 40 hours annually. After 90 days of employment, sick time may be used for an employee’s physical and mental health concerns or similar concerns for a direct family member. Employers providing existing leave benefits, if equal to or more comprehensive than the requirements of the new sick time law, will not be required to change their employee benefits.

Employers and employer organizations, including the Labor Relations Division of Construction Industries of Massachusetts, filed petitions with the court to challenge the law under concerns that it would change their existing union contracts. Citing the potential for pre-existing union negotiations would be negated by the change, they argued that the new state sick time law was preempted by the federal Labor Management Relations Act (LMRA). The LMRA, a federal collective bargaining law, was a core component of their argument against having to abide by the new rules for union employees. They contended that employees with benefits currently negotiated through a collective bargaining agreement should be exempt from the new legislation.

In addition, the plaintiffs brought concerns regarding the definition of “same hourly rate” and posed situations under which the term could cause confusion when calculating a sick time pay rate. Additionally, the plaintiffs requested an amendment stating that the new regulations be preempted by a separate federal law known as the Employee Retirement and Income Security Act (ERISA), which was also denied by the court.

Zobel held in the recent hearing that the LMRA does not preempt the new Massachusetts sick time law. In addition, regarding the interpretation of “hourly rate”, Zobel wrote, “If petitioners’ assumptions about how the law will be implemented and applied transport us from the factual to the hypothetical, then their scant allegations about the agreements with which it will conflict carry us on to the fantastical.”

The plaintiffs were provided with two weeks after the hearing date to file a new complaint on the allegation of the law’s conflict with ERISA.

California Superbug Trumped by Massachusetts-Made Device

An outbreak of drug-resistant bacteria at UCLA caused the death of several patients this past year. The source of the “superbug” was traced back to the use of contaminated endoscopes. Officials at UCLA stated that the endoscopes, by their design, are difficult to sanitize and that they followed the manufacturer’s cleaning instructions precisely.

The superbug is called CRE,  is a family of germs that live in the human gastrointestinal tract and have evolved to be resistant to antibiotics. CRE does not always cause an infection in people in fact if someone has a healthy stomach the infection may not occur. CRE becomes dangerous—and potentially fatal—when it reaches the bloodstream or the bladder. It can even cause infection if it is exposed to an open wound on the skin. For patients with other conditions such as cancer, the risk of death increases. Unfortunately, this is precisely the kind of underlying condition patients receiving the endoscopies had at the time the device was used.

Officials at UCLA have stated that the endoscopes are produced by different manufacturers and are all equally difficult to sanitize. Treating CRE is difficult due to its resistance to antibiotics and experts in infectious diseases state that drug companies have stopped producing new antibiotics because there isn’t enough money in the business. The best option, then,  is to prevent the spread of CRE in the first place.

Medford based Langford IC Systems has developed a possible solution to the endoscope threat. The company has been working with Proven Process Medical Devices for more than a decade to create a new medical device cleaning system. The small nooks and crannies of a small device, like an endoscope, pose a serious challenge when trying to assure the removal of microscopic bacteria. Infections can fester and grow despite stringent sanitization processes.

“The machine that we developed would clean, high level disinfect and rinse …off the instrument. It’s way ahead of its time,” said Terry Langford, founder and owner of Langford IC Systems.

Although the device has been approved by the FDA since 2011, there was not much of a market for it until now. With the outbreak of the superbug in California, hospitals have begun to reconsider the way their devices are cleaned. The small crevices and flexible nature of the endoscope make it hard to sterilize manually. The Langford IC cleaning unit is essentially a dishwasher for medical equipment. It pulses water several hundred times a second to flush out bacteria.
So far, a hospital in Missouri has installed the device. With third party proof of concept and an easy install method, the company expects many more requests as the year progresses.

One-Year Extension for Massachusetts to Comply with Obamacare

Massachusetts has been given an additional year to comply with the Affordable Care Act, following a trend of deadline extensions. Initially granted a one-year extension in 2013, they have now been granted another year to get the program aligned with federally mandated standards. Governor Baker has asked for an “indefinite extension” citing that the reduction of qualifiers used to determine premiums could cause a ripple effect of “instability” in the insurance marketplace. The new deadline allows them until January of 2018 to fully comply with ACA requirements.

Currently, Massachusetts Health Connector uses nine identifiers to determine health premiums, under Obamacare, that number would need to be reduced to four—only age, family size, geographic area, and tobacco use would be considered. The extension allows insurance companies to use their full range of factors—such as industry, group size, and participation rate—until 2017 when determining health care premiums. Another point of contention is the definition of small businesses under the ACA requirements. Governor Baker has asked that the definition of a small business in Massachusetts remains 50 employees rather than the ACA specified 100 employees.

The hope is that these allowances will help prevent small business from falling prey to huge rate hikes in insurance and the associated risk of having to downsize or even close shop should the premiums become too large for a small business to afford. Administrators from both sides have continued to negotiate the specifics of the requirements over the last few weeks.
This is just the latest chapter in the story of MassHealth’s continued difficulties complying to the federal ACA requirements and regulations. Just last month it was reported that the US attorney served a subpoena in January of 2015 for the Massachusetts Health Connector records dating back to 2010 in an attempt to figure out the difficulties MassHealth has encountered when trying to meet the ACA regulations. Massachusetts’ continued trouble complying with the ACA is an interesting puzzle, given that the ACA was modeled in large part after Massachusetts law, Chapter 58: An act Providing Access to Affordable, Quality, Accountable Health Care. This leaves one to wonder whether there are true difficulties with and concerns about the ACA regulations or whether the changing winds of political rhetoric and special interests are at the source of these current difficulties.

MassHealth Mistakes Cost Taxpayers Over $500M

In an audit of MassHealth—the MA Medicaid agency—released Tuesday, June 16th, by Massachusetts Auditor, Suzanne Bump, reported that the commonwealth’s health care program has wasted over 500 million dollars over the last five years. The errors resulted in duplicate payments being made for health services that were provided in the years studied. This error is the largest financial error uncovered by Bump’s office in nearly thirty years.

500 Million in Misapplied Funds

The audit of the MassHealth system covered the years between October 2009 and September 2014. During that five year period, the MassHealth system racked up an astonishing 500 million dollars in misapplied funds and unnecessary expenditures. Some 233 million dollars of the total amount was squandered by paying medical providers directly, in direct violation of existing laws that provide for those services to be paid for by a state qualified MCO (Managed Care Organization).

Doubly Charged for a Single Service

According to the audit, the problem that caused these errors has to do with MassHealth’s record keeping. MassHealth did not maintain a master list detailing which medical procedures must be covered by the MCOs program-wide. This meant that the MassHealth claims system was unable to identify the services that should have been covered by the MCOs. As a result, payments were made to direct medical providers for services that were already paid for through the MCOs. This happened not once, but on a total of nearly 1.5 million occasions. The bill has naturally been passed on to the state’s taxpayers, making this an issue that will have far reaching financial, social, and political repercussions.

A Shocking and Shameful Sum

In addition to the 233 million dollar error by the state’s Medicaid system, Auditor Bump’s report also managed to expose an additional 288 million dollars that was wasted when the MassHealth agency spent that amount on services that it was not required to provide. It turns out that these services—although not provided for under the terms of a legally binding contract—were often covered by MCOs in the commonwealth. As a result, the total expenditure of misapplied funds has risen to an officially estimated $521 million.

Disputing the Findings

Following the revelation of these unprecedented charges, MassHealth has struck back in its own defense. The agency has issued statements to the public in which it claims that only $60 million (of the alleged total of $233 million) was wasted in payment for duplicate funds. It also claims that $127 million of the total figure was spent in an appropriate fashion. However, MassHealth also stated that it needed to make their policies more clear and would implement “all actionable recommendations” from the audit.

Some MA Business Owners Urging Delay of Sick Time Law

In November of 2014, by a margin of 19 percent, voters in Massachusetts clearly expressed their wishes that a statewide provision be implemented requiring all employers to offer sick time. Every employer in the state will soon be required to offer either paid or unpaid sick time, depending on their number of employees. In each case, employees will be required to accrue the time with their hours worked, one hour for every thirty. This sick time is to be available to all employees, whether full or part-time.

The regulations are expected to be issued by the Attorney General’s office in mid- June and the law is set to go into effect this July. However, some employers are concerned, saying that the compressed time frame simply doesn’t allow businesses enough time between that publication date and the implementation of the earned sick time law. This is the primary complaint being voiced by most businesses. Without those regulations in place for use as a guideline, they say, businesses will be unlikely to be able to fully comply with the new law quickly enough. There are also concerns about businesses modifying existing sick time policies to match up with the new regulations, particularly given that most are likely in the middle of their fiscal year. Representatives from both camps are now asking that the date for implementation be pushed back to January of 2016

On the other side of the argument are proponents of the new law, like Raise Up Massachusetts, who want the law to go into effect as it was originally intended – on the very same timeline chosen by voters. They claim that the people have shown that they want this law and that this matters more than any difficulties businesses may face as a consequence of implementing the new law.


Spaulding Closing Salem Location

Administrators at Spaulding Hospital have announced that it will shut down The Spaulding Hospital for Continuing Medical Care North Shore’s inpatient operations by the end of September 2015, with the hospital saying that new federal regulations will severely impact patient volume.

Approximately 320 people are scheduled to be laid off because of this move and Spaulding has indicated they would, where appropriate, be assigning some displaced staff to other positions within its parent Partners HealthCare system while others will be receiving severance packages.

The Salem location, formerly known as the Shaughnessy-Kaplan Rehabilitation Hospital, has been experiencing declining inpatient numbers for years and now operates below 50% capacity. Given recent policy changes at the Centers for Medicare and Medicaid Services, inpatient volume was predicted to dip to below 32 percent.

“The dramatic further decline based on the new admitting criteria established by CMS has created an untenable situation. Sadly, it is no longer viable to continue SNS’s inpatient services,” said David Storto, president of Partners Continuing Care, and Maureen Banks, president of Spaulding Hospital for Continuing Medical Care North Shore.

“The new LTAC regulations will not impact Spaulding Hospital Cambridge to the same degree because of a different Medicare mix and a greater number of referring hospitals,” Spaulding officials said.

Spokespeople for Partners HealthCare say the CMS changes won’t affect patient services at any of their other hospitals. Both inpatient and outpatient services will still be available in Charlestown, Cambridge and on Cape Cod, as well as at skilled nursing facilities in Boston and outpatient sites in the North Shore.

Gains Reported in State’s Human Services Sector

A new research study released by the Donahue Institute at the University of Massachusetts in conjunction with UMass Dartmouth has revealed that human services sector employment in the Bay State increased nearly 48 percent during the years spanning 2003-2011, a fact many in the industry will surely find to be a source of encouragement. In addition, the report indicated that the 145,000 members of that sector generated disposable income in an amount ultimately responsible for a $3.4 billion statewide economic impact in 2011 alone.

The study had been commissioned by The Providers’ Council, a leading association for community-based groups across the Commonwealth. Creation of the report was overseen by David Jordan, CEO of Seven Hills Foundation, together with fellow Providers’ Council committee members who had been charged with the task. Formally released at the Statehouse, the report also declared that the 145,000 jobs comprising the human services sector equated to 5 percent of the total jobs within the state, and that this sector had increased in size more rapidly than anticipated.

Other key findings in the report include the fact that, despite sector growth, state budgetary allocations for spending on human services shrunk from 11.8 percent in FY 2003 to just 9.8 in FY 2014, something fiscal watchdogs are likely to applaud. Also of note was the discovery that out of all industries represented within Massachusetts, human services included the highest rate of employees with a defined disability, at 6.5 percent.