Insurance Advocate December 2019 by C Acunto

Vol. 129 No. 20 | December 24, 2018

Reg 187 Battle Lines... Written PIANY and Big I Join in Opposition, as DFS Promulgates Reg 187 PAGE 14

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Contents

16 Reg 187 Battle Lines...Written 4

Foreword: On White Noise Steve Acunto, Publisher

HR Update: Should Companies Screen Their Job Applications’ Social Media? Alfred T. DeMaria

On the Level: Dear Producer - No Insurtech is No Excuse Jamie Deapo

Workers’ Comp: What Does the Future Hold for Workers’

Compensation Insurance Rates Donald T. DeCarlo and Roger Thompson In the Associations: NYIA Provides Industry Roadmap

at New York Auto Forum

On My Radar: Private Limitations of Action Provision Enforced Barry Zalma

In the Associations: IBANY Announces 2018

Insurance Person of the Year 26

Looking Back: November 27, 1993

Courtside: When Medical Providers Bills Under a

“By Report” Code, Insurer Must Demand Supporting Documents if it Wants Them Lawrence Rogak 30 info@insurance-advocate.com www.insurance-advocate.com

Guest Opinion: Epidemics, Fear and Denial: How Every

American Is Threatened Janet M. Orient, M.D.

[ FOREWORD ]

STEVE ACUNTO

On White Noise uThis is a holiday letter as 2018 closes, but I cannot wax too poetically about the season or the past year, given the great insurance professionals we lost and given this past year’s growing factionalism in seemingly everything. I mean everything. The incessant white noise, the insane bickering on TV, whether its Fox or MSNBC or just Chris Cuomo and KellyAnne Conway on CNN slapping each other verbally, interrupting and getting...no where, or those crowded restaurants with boosted ambient amps of throbbing music to make you eat faster or shout louder or that infernal repetition of Santa Claus and his reindeer songs in every store everywhere to make you buy more, faster and perhaps under a spirit of some nostalgia. While I like a lot of what the President has done, I admit to Trump fatigue, ennui, irritation, malaise. I really do not care about Stormy Daniels or Michael Cohen or Menendez of Ocasio Cortez or the many arrests of public officials or the cast of characters to whom we have been treated—on both sides of the aisle—this past year. For one, I care about getting past it all to some new plateau of public discourse. America is electing crooks and major incompetents in the absence of the best and the brightest stepping up. We are at risk of mediocrity as a nation and strangulation of our sense of national pride, as a consequence. Were it not for private industry’s initiative and capital, the inertia would be poured upon us by an assortment of subjective journalists, filthy mouthed actors and actresses who have the public spotlight and by irresponsible elected officials who operate under assumed mandates. It just has not been a beautiful year, whether financially successful or not. Not beautiful. Insurers have little to do – happily – with this sour sense of the present, as long as the promises are kept and the marketing a-political and not politically correct, just straight and clear. The industry stands to do well under the Trump economy, especially if the undoing of the ACA is realized. But somewhere there needs to be a sense of the good and the beautiful again in what we all do every day. I pray for that. Not a very cheery column, but please take from it what I hope is a shared wish: for a return of that dimension of beauty in the lives of all of our readers, beyond material success and beyond the holding of “things”. It is worth striving for and I pledge to do that in the New year as a gift to my family. May you and yours have a Blessed Holiday Season and a richly beautiful New Year. Steve Acunto

Donald T. DeCarlo, picture here with Derrick Chambers former NFL player for the Ravens and Jaguars, was honored at the the 2018 Diabetes Research Institute Gala in November. Congratulations Don!

S I N C E

1 8 8 9

VOLUME 129 NUMBER 20 DECEMBER 24, 2018

EDITOR & PUBLISHER Steve Acunto 914-966-3180, x110 sa@cinn.com CONTRIBUTORS Jamie Deapo Alfred T. DeMaria Sari Gabay Lawrence N. Rogak Barry Zalma PRODUCTION & DESIGN ADVERTISING COORDINATOR Gina Marie Balog 914-966-3180, x113 g@cinn.com SUBSCRIPTIONS P.O. Box 9001, Mt. Vernon, NY 10552 914-966-3180, x113 circulation@cinn.com PUBLISHED BY CINN Global Initiatives P.O. Box 9001, Mt. Vernon, NY 10552 (914) 966-3180 | info@cinn.com www.cinn.com President and CEO Steve Acunto

CINN GROUP

INSURANCE ADVOCATE® (ISSN 0020-4587) is published bi-monthly, 20 times a year, and once a month in January, July, August, and December by CINN ESR, Inc., P.O. Box 9001, Mt. Vernon, NY 10552. Periodical postage pending at Greenwich, CT and additional mailing offices. POSTMASTER Send address changes to Insurance Advocate®, P.O. Box 9001, Mt. Vernon, NY 10552. Allow four weeks for completion of changes. SUBSCRIPTION RATES $59.00 US, Canada $65.00, International $135.00. TO ORDER Call 914-966-3180, email: circulation@cinn.com or write: Insurance Advocate® PO Box 9001, Mt. Vernon, NY 10552 or visit www.Insurance-Advocate.com. INSURANCE ADVOCATE® is a registered trademark of CINN ESR, Inc. and is copyrighted 2018. All rights reserved. No part of this magazine may be reproduced in any form without consent. Trademark registered U.S. Patent and Trademark Office.

For high-quality article reprints (minimum of 100), including digital rights, contact Gina Marie Balog at g@cinn.com or call 914-966-3180, x113 4 December 24, 2018 / INSURANCE ADVOCATE

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[ HR UPDATE ]

ALFRED T. DEMARIA

Should Companies Screen Their Job Applications’ Social Media? uThis has become an increasingly important question since surveys reveal that more than half of employers inquire into a prospective employee’s online social media activity during the hiring process. The insurance industry is no exception. However, there are a number of pitfalls involved in such screening. The major ones are: Pitfall No. 1: Only Performing Social Media Background Checks On Certain Applicants Employers who arbitrarily determine which applicants will be subject to social media screening are subject to the risk of a successful employment discrimination claim in the same way that they would be liable, for example, for randomly performing criminal background checks on some applicants or arbitrarily deciding that certain minimum job requirements, like holding a degree, are only applicable to certain candidates for employment.

Pitfall No. 2 Inconsistently Reviewing Social Media Postings or Taking Into Account An Applicant’s Protected Status An employer that views applicants’ social media postings to determine whom to interview may discover a Facebook posting indicating a protected status, for example, someone who has a disability, or is of a certain religion, nationality, or race. In a discrimination lawsuit, the employer would then be left to argue that although it had knowledge of the applicant’s protected characteristic, it did not take such information into account when declining to invite the applicant to interview. Pitfall No. 3 Hiring a Third Party to Perform Social Media Screenings But Failure to Follow the Procedures of the Fair Credit Reporting Act

BARRY ZALMA, INC. 4441 Sepulveda Blvd., Culver City, CA 90230-4847 www.zalma.com | zalma@zalma.com 310-390-4455 | fax: 310-391-5614 | http://zalma.com/blog

Mr. Zalma recently published on Amazon.com with links at the Zalma Books site, with the following: Non Fiction books: • “Random Thoughts on Insurance • “Insurance Fraud & Weapons to Defeat Volumes IV and V: Digests from Barry Insurance Fraud” In Two Volumes Zalma’s Blog: ‘Zalma on Insurance’” • “The Compact Book on Adjusting Fiction: Liability Claims: A Handbook for the • “HEADS I WIN, TAILS YOU LOSE” Liability Claims Adjuster” • “Candy and Abel: Murder for • “The Compact Book on Adjusting Insurance Money” Property Claims” • “Ethics for the Insurance Professional” • “Murder And Insurance Fraud Don’t Mix” • “Rescission of Insurance” • “Murder & Old Lace” • “The Insurance Examination Under Oath” 6 December 24, 2018 / INSURANCE ADVOCATE

Alfred T. DeMaria is a Senior Partner at Clifton Budd & DeMaria, LLP and is recognized as one of the preeminent management labor attorneys in the field. He has extensive experience in all areas of employment law, including advice on avoiding liability under disability, race, gender, age and related anti bias laws. Mr. DeMaria advises on compliance with all federal, state and local laws governing the employment relationship, including the defense of lawsuits brought by employees against the companies that employ them. Prior to his work at Clifton Budd & DeMaria, LLP, he served as a trial attorney with the National Labor Relations Board.

Using third-parties to screen applicants would subject the employer to the requirements of the Fair Credit Reporting Act (FCRA), a federal law governing employment decisions that rely upon consumer reports. The FCRA imposes stringent requirements on an employer who refuses to hire based, in part, on social media information, which is covered by the FCRA. Pitfall No. 4 Requiring Applicants to Divulge Their Social Media Passwords A not uncommon practice, asking for passwords is the equivalent of an employer asking for the keys to the applicant’s house. Aside from obvious privacy issues, this practice could violate many existing and proposed state laws prohibiting employers from requiring an applicant to divulge social media user ID’s and passwords. OBVIOUSLY, EXTREME CARE SHOU L D BE TA K E N B Y A N Y EMPLOYER USING SOCIAL MEDIA TO EVALUATE APPLICANTS FOR EMPLOYMENT.[IA]

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[ ON THE LEVEL ]

JAMIE DEAPO

Dear Producer – No Insurtech is No Excuse uWhat is insurtech? It’s a recently created name for a growing class of apps, software and insurance startups that use cutting edge technology to quickly and efficiently provide insurance, customer service and customer engagement. If you think insurtech is the answer to writing insurance you’re sadly mistaken. Insurtech is merely a tool to make the job quicker and more efficient. Just like a nail gun replaces a hammer in building a house. The important thing is that in both cases the tool is no good unless it’s used by a professional craftsman or woman. They are the real genius that allows the consumer to get the best product possible. So as an agent or broker, especially a new one, it’s important you realize that insurtech only allows you to spend more time creating relationships and building trust with clients and prospects. Even insurtech companies realize that the technology is most effective when supported by a direct working relationship between customer and insurance professional. I realize there are some insurance providers that depend solely on insurtech, AI and psychological selling methods to capture and retain new clients. They seem to be most attractive to younger consumers who are used to buying things online and don’t understand the danger of buying insurance protection that way. As a professional insurance agent and advisor, you need to use social media, your website and your blog to educate those consumers that would buy direct of the potential of both too little coverage and missing coverage. Not all buyers will listen, however as time goes on more and more of them will be financially hurt and learn the hard way the need for professional advice from a trusted and knowledgeable agent. 8 December 24, 2018 / INSURANCE ADVOCATE

As a professional insurance agent and advisor, you need to use social media, your website and your blog to educate those consumers that would buy direct of the potential of both too little coverage and missing coverage.

So, what does all this mean? Is insurtech not important? The answer is insurtech is important for the most efficient and effective operation of an agency. The speed and service it provides allows more time for working directly with clients and prospects. Many prospects like It because it offers them quick and easy pricing. The issue is that frequently they select coverage that may not adequately protect them. That’s where you as a professional producer can build trust by helping a prospect understand insurance coverage and then helping them select the protection they want and need at a competitive price. You want your agency to have the most effective insurtech available however cost, time and people resources sometimes get in the way. Whether you have little or no insurtech to rely on as a producer you must work smarter and harder to get in front of as many prospects as possible, so you can tell your story. As a producer your job is to find, offer coverage to and write new clients. Lack of insurtech is not an excuse for lack of success. Using whatever resources you have at your disposal you need to find people and businesses that will allow you to offer them an insurance proposal. Social media, your website/blog, introductions, referrals and old-fashioned prospecting are ways to get to see and

Jamie Deapo is AVP of Membership & Member Programs for Big I and is an approved CE instructor in New York. Prior to being with Big I, he was an independent agent in the Syracuse area for 15 years. Jamie started his career in 1972 working for insurance carriers, and he has held various underwriting and marketing positions with several national as well as regional companies. He is a past president of the Independent Insurance Agents of Central New York and served on the board of directors of Big I.

talk insurance with as many people and businesses as possible. The more you are “out there” the more you will see your prospect appointments increase. Aggressive prospecting and activity have a positive effect on the number of people you get an opportunity to talk with or see. Social media is a great way to offer valuable information for insurance buyers. So is your website/blog. Offering useful information shows you are more than just a salesperson. As they find the information informative and helpful, you will be recognized as a knowledgeable resource on insurance issues. Remember information you might think is basic may hold serious consequences for an unaware consumer. The point is as a producer your job is to attract, talk and work with as many people and businesses as possible. Having no or limited insurtech resources at your agency is not an excuse for failing to produce. You need to aggressively work with the tools you have. Your personal knowledge, focus and commitment can overcome faceless automation backed by scripted AI.[IA]

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[ WORKERS’ COMP ]

D ONALD T. DECARLO AND RO GER THOMPSON

What Does the Hold for

Future Workers’ Compensation Insurance Rates

10 December 24, 2018 / INSURANCE ADVOCATE

[ WORKERS’ COMP ] u T he Nat i ona l C ou nc i l on Compensation Insurance (NCCI) reports that workers’ compensation insurance rates will again dip in most states in 2018. The report attributes this continuing decrease to two factors; (1) declines in the frequency of claims; and (2) improvement in the area of workplace safety on the part of employers. Tony Gillespie with the Property Casualty Insurers Association of America observed that “When you couple the claims frequency still going down and you have more stable medical costs and very stable indemnity costs, then you are going to keep seeing a progressive reduction in loss costs and rates.” As background, NCCI is an advisory organization the development and promulgation of workers’ compensation rates in the majority of states. In most states, the NCCI and other rating organizations no longer file final recommended rates. Instead, they file actuarial “loss costs” or pure premium rates. Companies then gross up loss costs for their own particular expenses and rating policies. These insurance rates and loss costs reflect the cost of the product being insured. In the case of workers’ compensation, insurance rates and loss costs reflect the costs associated with wage replacement (indemnity benefits) along with the cost of medical care and

other incidental expenses associated with workplace accidents. In 2017, of the 38 states where the NCCI made rate filings, 36 of those filings were for decreases; many of which were double digit decreases. The trend continued in 2018 where NCCI filings showed decreases proposed in 36 states. As demonstrated in the following exhibit, in 13 of those states, the rate filings decreases were greater than 10%. In states where rates are approved by independent bureaus, there is a similar downward trend in workers’ compensation rate. The New York Department of Financial Services (DFS) approved a 11.7% decrease in workers’ compensation loss costs effective October 1, 2018. In New Jersey, the insurance commissioner has approved a 5.1% rate decrease for workers’ compensation premiums on a new and renewal basis. These decreases are taking place across the country. Even California which has a long history of being among the highest in terms of average insurance rates has seen a recent rate decrease. The filing recently approved to be effective Jan. 1, 2019 decreases workers’ compensation loss costs an average of 11.7%. Further decreases may be in the future following evidence that CONTINUED ON PAGE 12

Donald T. DeCarlo, Esq. is the principal of an independent law firm in Fresh Meadows, NY, which focuses on mediation/arbitration and regulatory and insurance counseling. Previously, he was Partner at Lord Bissell & Brook LLP and headed its New York office. He was Senior Vice President and General Counsel of The Travelers Insurance Companies, Deputy General Counsel for its parent corporation Travelers Group, Inc. and Executive Vice President and General Counsel for Gulf Insurance Group. Mr. DeCarlo is a Certified ARIASUS Arbitrator and Umpire, a Master Arbitrator for the NYS Insurance Department, and an Arbitrator for the American Arbitration Association and Center for Dispute Resolution. He is the Founder, Chairman and President of The American Society of Workers Comp Professionals, Inc. (AMCOMP). In addition, Mr. DeCarlo is a Director of 17 companies in the insurance industry. Mr. DeCarlo has authored numerous scholarly articles in legal and trade journals and is a co-author of two books on workers compensation insurance, Workers Compensation Insurance & Law Practice – The Next Generation and Stress in the American Workplace – Alternatives for the Working Wounded. Mr. DeCarlo Chairs an Advisory Committee of the World Trade Center Captive Insurance Company, and formerly served as Chairman and Commissioner of the New York State Insurance Fund (NYSIF) for 10 years. He also served as an Inspector for the NYS Athletic Commission.

INSURANCE ADVOCATE / December 24, 2018 11

[ WORKERS’ COMP ] CONTINUED FROM PAGE 11

medical payments for workers’ compensation claims continues to fall. These reduced medical payments may be attributed to reforms enacted in 2013 along with a vibrant economy with low unemployment. As stated at the outset, reductions in claim frequency, improved workplace safety, stability in medical and indemnity costs all contribute to the ongoing trend of decreasing workers’ compensation insurance rates. But are there any issues that may portend a change for the future? Things have a way of going in cycles and workers’ compensation insurance rates are no exception. The following looks at some specific areas where the potential exists to reverse recent rate trends. • Obesity in the Workforce – Studies reveal that the number of obese individuals in the United States has steadily increased over the past 30 years. According to the Centers for Disease Control and Prevention (CDC), 37.9% of people 20 years of age and older were obese in 2013– 2014, while a staggering 70.7% of adults were either overweight or obese. Even more concerning is the fact that nearly half of those obese or overweight people are living with comorbidities, such as hypertension, diabetes, heart conditions, lung conditions, and cancer. Employers offering workplace wellness programs can influence the eating and health behaviors of both employees and their families thereby improving the health status of both the current and future workforce. Nonetheless, sustained weight-loss for employees has proven a difficult goal for many wellness programs. Obese and overweight employees often avoid or even resist a wellness weight-loss program if they feel it sets them apart from their co-workers’. Obesity does have an impact on workers’ compensation claims. Obese workers’ often experience injuries that are more severe because extra weight generates increased force during an accident. The period of recovery following a workplace accident is often in12 December 24, 2018 / INSURANCE ADVOCATE

Addiction and overuse of opioids is also common within the workers’ compensation world, since opioids are often prescribed for post-surgical pain and other complex conditions associated with workplace injuries and conditions. creased; a 2010 study conducted by the NCCI found that the duration of indemnity benefits paid is at least five times greater where obesity is involved. Finally, obese individuals have an increased incidence of depression and other mental health issues, which can make them more susceptible to opioid abuse; of, if they undergo surgery, there is a high danger of complications, such as blood clots • Aging of the Workforce – The Bureau of Labor Statistics (BLS) estimates that by the year 2020, the sub-population of older adults in the United States is expected to reach nearly 98 million people, comprising nearly 30% of the entire U.S. population. It is also projected that by 2020, 25.2% of the proportion of the U.S. labor force will be composed of older adults. This continues a trend in increasing rates of older adults remaining in the workforce, as the rates were 13.1% in 2000 and 19.5% in 2010. A complementary trend is the increasing median age of the U.S. workforce. By 2020, the workforce is expected to have a median age of 42.8, which will be an increase from 39.3 in 2000 and 41.7 in 2010. Another factor contributing to an aging workforce is that employment rates among older workers’ are increasing. The number of people who continue working after they are 65 is relatively high in the U.S. when compared to other developed countries. Due to the physical declines associated with aging, older adults tend to exhibit losses in eyesight, hearing and physical strength. While data seems to show that older adults have low overall injury rates compared to all age groups, they are more likely to

suffer from fatal and more severe occupational injuries. In addition it is well recognized that the period of recovery for older workers’ who sustain an injury is also extended. Among older workers’, hip fractures are a large concern, given the severity of these injuries and the duration of recovery. • Opioids and Marijuana in the Workplace - According to the Centers for Disease Control and Prevention (CDC), 115 Americans die each day from an opioid overdose. Opioids are a class of drugs that include illegal drugs such as heroin, synthetic opioids such as fentanyl and a number of prescription pain relievers. One of the often overlooked areas where the opioid epidemic is creating a crisis is the workplace. The BLS recorded 217 workplace overdose deaths in 2016 from non-medical use of drugs and alcohol, accounting for 4.2 percent of all worker injury fatalities that year. Such deaths accounted for 1.8 percent of the total fatalities in 2013 and have increased by at least 38 percent annually over the four-year period. Addiction and overuse of opioids is also common within the workers’ compensation world, since opioids are often prescribed for post-surgical pain and other complex conditions associated with workplace injuries and conditions. Earlier studies conducted by the Workers’ Compensation Research Institute (WCRI), a workers’ compensation research organization located in Boston, MA, confirmed the widespread use of opioids in workers’ compensation. A recent study focusing on the impact these drugs have on duration of disability revealed that temporary disability duration was 251% higher on claims receiving opioids on a long-term basis. The higher the dosage, the greater the increase in disability. Marijuana in the workplace is a well identified topic of concern. The recreational use of marijuana is now permitted in 8 states and CONTINUED ON PAGE 14

ADVERTORIAL

Friendly Fraud and Chargeback Fraud By Sue C. Quimby, CPCU, AU, CIC, CPIW, DAE - Assistant Vice President/Media Editor

u ANY CLIENT WHO D OES BUSINESS with the public, especially online, is exposed to various types of fraud. It is interesting to note that not all fraud is planned or intended. No matter the type of fraud, it has a significant impact on the economy. Helping clients understand and battle various types of fraud is another value-added service of the professional insurance agent. The digital on demand economy has increased the avenues for potential fraud. In the past, there was less chance of misappropriation or malfeasance since credit cards were kept in a wallet and physically handed to the merchant at the point of sale. Now, account information can be stored on multiple sites and purchases are regularly made on “good faith”. The merchant provides the goods or services based on an implied promise that the electronic payment transaction will be completed by the customer. “True fraud” involves identity theft, or use of a stolen credit card. It is usually committed by someone unknown to the victim. “Friendly fraud” or “chargeback fraud” are types of fraud committed by the account holder. There is an important distinction between the two. While chargeback fraud is an intentional effort to obtain goods or services without paying for them, friendly fraud is most often a case of misunderstanding. “Friendly fraud” could come from several sources - misunderstanding of a merchant’s return policy, forgetting about a purchase, or purchases made by another cardholder (such as a spouse) that the cardholder may not know about. A customer could sign up for a subscription service and not understand that there would be ongoing recurring charges. In cases of friendly fraud, the merchant must strike a delicate balance. They want to solve the issue without alienating the customer and losing future sales.

Chargebacks came about as a result of The Fair Credit Reporting Act of 1974, to protect consumers and increase confidence in the use of credit cards. In nearly half the cases, the chargeback was a simple misunderstanding- the consumer did not realize they were filing a chargeback. Confusion over how the transaction is listed on a credit card statement can lead to a chargeback – the billing description needs to be more than just the merchant’s name (https://smallbiztrends.com/2017/10/ chargeback-fraud-small-business.html). “Chargeback fraud” occurs when a customer attempts to obtain a credit for items that they have received. This is an intentional attempt to defraud the seller. Examples include a claim that items were never received, or the items were returned but not credited. Friendly fraud is not insignificant. Estimates place the cost to merchants at over $25 billion by 2020 (https://chargebacks911. com/chargeback-stats-2017). In cases of legitimate disputes, it is essential for customers to contact the merchant directly, rather than the bank or credit card company. While it may seem faster and easier to contact the bank, the process has a number of unpleasant consequences, for merchants as well as consumers. When a customer disputes a charge directly to the bank, the payment to the merchant is blocked, the charge is reversed and the merchant

is assessed a nonrefundable fee of between $5-$35 per item. This is done without the merchant having the chance to prove the purchase was real, without having to first fill out a lot of paperwork. It is time-consuming for merchants to dispute chargeback cases, and therefore they may not do so, except if the dollar amount of the purchase is significant. The loss may be turned back to all of the merchant’s customers in the form of increased prices (https://www.cbsnews. com/news/friendly-fraud-an-enemy-toeveryone-in-the-e-commerce-chain/). The most common targets of chargeback fraud include: clothing, digital content, furniture, high-end merchandise, and anything that can be easily resold. Service industries are also common victims, including financial services, gaming, media, software and travel (https://chargebacks911.com/ chargeback-stats-2017/ ). Sellers can help to prevent chargeback fraud by monitoring for unusual sales – such as large purchases in terms of dollar amount or number of items. Several purchases from the same IP address but using different credit cards may also signif y f raudulent activity (https://smallbiztrends.com/2017/10/ chargeback-fraud-small-business.html). Fraud impacts all facets of society – from lost productivity of the merchant who has to deal with the issue to increased costs passed onto the consumer. Although not all fraud is intentional, it still is costly. Helping clients understand the types of fraud and possible ways to manage their exposure is another sign of the true insurance professional.

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[ WORKERS’ COMP ] CONTINUED FROM PAGE 12

the District of Columbia. 30 states permit its use for medical purposes. In addition to risk of injury, increases in absenteeism and injuries to co-workers’ may occur, as marijuana-containing products become increasingly available to workers’. Both construction and transportation represent employments where the use of marijuana is inherently hazardous. Falls, serious injuries associated with the use of power tools, and vehicular accidents represent the more common incidents. In the meantime, states continue to grapple with approaches that protect the workplace while not infringing on the rights of workers’. Regardless of the strength of the arguments in favor of or against medical marijuana usage, its use in the workplace is primarily a safety issue • Workplace Safety Programs The U.S. Occupational Safety and Health Administration (OSHA) strongly promotes safety and health training as an essential component of employers’ efforts to provide a safe workplace. Hundreds of requirements for safety and health training are found in occupational safety and health standards promulgated by OSHA. Regulations promulgated by OSHA also limit certain jobs to persons receiving specialized training. In addition to OSHA requirements, firms receive worker’s compensation premium discounts for their implementation of safety programs. A survey by BLS indicates that U.S. employers spend a considerable amount of time and resources on both formal and informal training including safety training. This study offers a rare look at the effect of training, benefit packages, and workplace practices on work injury. Results suggest that safety training increases the reporting of injuries but also has real safety effects on days-away-from-work injuries, especially in smaller firms. Safety training appears to be more effective in preventing severe injuries in large firms than in small ones. While overexertion injuries were 14 December 24, 2018 / INSURANCE ADVOCATE

resistant to safety training, toxic exposure events were reduced in manufacturing establishments with a formal safety training program. • Legislative and Judicial Activity - Following the recommendations of the National Commission in 1972, virtually all states worked to broaden the extent of their coverage while at the same time increasing the level of benefit entitlement to injured workers’. Ultimately, there arises the question as to whether the coverage and/ or benefit pendulum swung too far in favor of the injured worker. Over the past 30 years there have been various legislative enactments directed at either one or both of these factors. Many of these laws were designed to raise the threshold in terms of what constituted a compensable injury or occupational disease. More recently, there has been a recognition that over time there has been such an erosion of injured employee rights that the original “grand bargain” is no longer in place and that injured workers’ should, therefore, be allowed to proceed against employers with a direct action for damages. At the state level, we see a growing number of constitutional challenges to provisions such as the time period in which to bring a claim, the level of attorney fees, and the removal of certain benefits available to injured workers’. In response to growing costs experienced earlier, Texas and Oklahoma enacted “optout” provision permitting employers to provide alternative coverage for workplace injuries. In the upcoming years, we may see a healthy debate regarding the level of overall benefits being paid to injured employees along with more expanded coverage. A recently released national study by the Rand Corporation is urging changes to the workers’ compensation system. The study was commissioned by the US National Institute for Occupational Safety and Health (NIOSH) and approaches necessary improvements in order to make the nation’s workplaces safer. While still in the early stages, these activities may prove to portend the future for workers’ compensation.

Roger Thompson is a retiree from Travelers Insurance following thirty years of service in the area of Workers Compensation. Prior to his retirement, Mr. Thompson was Director for Worker’s Compensation Legislative and Regulatory Issues. A graduate of the University of California, Santa Barbara, he began his career with Travelers in Des Moines, Iowa in 1969 and subsequently transferred to the Home Office in Hartford, Connecticut in 1976. During his career with Travelers, Mr. Thompson worked with various trade associations including the American Insurance Association (AIA), The International Association of Industrial Accident Boards and Commissions (IAIABC) and served on the Research Committee at the Workers Compensation Research Institute (WCRI). Mr. Thompson is married with two sons and four grandchildren.

The above noted issues along with a host of others including levels of employment and the potential for an economic recession all lead to the observation that a continuing decline in workers’ compensation insurance rates may not be a sign such action may continue into the future. If these change should occur, history shows that following activity at the state level to increase benefits and coverage following the 1972 National Commission report, state regulators were slow in approving adequate insurance rates. The same concern exists today that insurance regulators may not be as quick to respond to any increase in claim costs and frequency as they are when claim costs and frequency are going down. At the same time, employers are eager to support rate decreases but hesitant to support action in the opposite direction.[IA]

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Not sure how the seemingly nonexistent balance of power in Albany will affect an insurance agents petition to stymie proposed Regulation 78 initiated by the PIANY and the Big I together, but the consent of an insurer segment won’t help much.

uArticle 78 proceeding started, as agents see harmful “vague standard” and worse. Not sure how the seemingly nonexistent balance of power in Albany will affect an insurance agents petition to stymie proposed Regulation 78 initiated by the PIANY and the Big I together, but the consent of an insurer segment won’t help much. It looks to us as if DFS Supt. Maria Vullo may well have the last word on the controversial Regulation. Following the press releases and arguments of the PIANY and Big I of New York, she issued a statement that expresses the solidarity of the life insurance industry with the Reg. “The Department of Financial Services (DFS) is pleased to have the support of New York’s nation-leading life insurance industry for our Regulation 187, which sets a best interest standard for the recommendation of life insurance and annuity products. The industry agrees with DFS that it is prudent, fair and reasonable – and just simply the right thing to do – to act only in the consumer’s best interests and obtain necessary financial and risk information from their clients in order to recommend a specific policy based on that data. Given the vital role that insurance products play in providing financial security to New Yorkers, it is essential that providers not be influenced by a producer’s financial incentives, adhere to a higher standard of care and only recommend insurance and annuity products that are in the consumer’s best interests.” It appears that the agents’ have an uphill battle – not unusual for them; it’s the kind they have won in the legislature historically, but then there are the courts. To fight back against what they call “overreach” by the Department the two groups, which represent 16 December 24, 2018 / INSURANCE ADVOCATE

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the vast majority of independent agents and brokers in New York, filed a legal challenge to the recently adopted amendment to Regulation 187 that imposes, they hold, “a vague standard of best interest on the sale of life insurance and annuities”. The suit seeks to have the amendment voided in full. This new standard, they reason, would significantly alter the agent/broker-customer relationship. The agents argue that the amended regulation would require agents and brokers to obtain detailed financial and risk information about their customers, and then recommend a specific policy based on that data—similar to the way financial investment products are offered. This would overturn decades of well-established case law that holds agents and brokers have no duty to recommend, and consequently significantly increase the risk of E&O lawsuits. They make a strong point, i.e. that the new standard is subjective and “fails to instruct agents/brokers whose best interest they must consider; be it the policyholder, beneficiary, or owner of a policy—interests which are rarely, if ever, perfectly aligned.” The new standard will leave the insurance-buying public with reduced access to affordable coverage, they hold, although that may be hyperbolic to prove the point that the desirability of doing business in the State will discourage agents and their clients. For now, the associations hold, the troublesome amendment affects only life insurance and annuities, but serves to augur serious concerns that the Department could later expand the “best interest” standard to all insurance transactions. “Life insurance is not a uniform, one-size-fits-all product and coverage recommendations should not be regulated. Restricting how an agent communicates with his or her client does a disservice to that client, and will potentially lead to less access for consumers” said PIANY President Jamie Ferris, CIC, AAI, CPIA. Mr. Ferris further remarked, “In a highly competitive business environment, independent producers’ best marketing strength is their concern for their clients. Restricting open, honest discussion, driving out business, ultimately weakening the market will harm New York state’s insurance-buying public.” The lawsuit identifies six separate legal grounds which challenge the amended regulation. Among the key contentions are: the DFS overstepped its authority; violated the State Administrative Procedures Act; created an unconstitutionally vague regulation; and acted in an arbitrary and capricious manner. During the amendment’s public comment period, both Big I NY and PIANY attempted to work in good faith with the DFS to create a balanced approach that would serve customers’ interests while protecting consumer access to the market. CONTINUED ON PAGE 18 INSURANCE ADVOCATE / December 24, 2018 17

CONTINUED FROM PAGE 17

“The DFS is failing one of its most important responsibilities: to ensure New York’s public has access to a healthy insurance market, with multiple products and options for customers’ coverage needs. This amendment will drive business out of the state and leave the insurance-buying public with reduced access to affordable coverage choices,” said Big I NY Board Chairman Louis Atti, CPCU. “That’s in nobody’s best interest.” Earlier this year, writing on behalf of the Big I, lobbyist Jill Muratori addressed these and other concerns to Deputy Superintendent Regalbuto. She writes: “Ultimately, we believe the proposal will make buying life insurance more complicated for consumers and lead to fewer consumers buying these important policies.” Here are objections listed: The Department has created an exemption from the entire regulation for policies purchased in response to a direct solicitation where no producer is involved, and no recommendations made. This exemption raises concerns, most notably that it will be much easier for a company to sell life insurance and annuities directly, without producer involvement. For example, if a product is sold directly with no insurance producer involvement the insurer does not need to consider any suitability information at all. If the same product is sold by a producer, the producer must go through the laundry list of suitability questions. This doesn’t make sense if the product the consumer is purchasing is the same. The Department has established an exemption that will ultimately harm consumers by depriving them of receiving advice and recommendations they may want. The Department has made some changes to the types of suitability information that must be considered by producers when selling term life insurance. We appreciate that the Department has tailored this provision for term life sales, but it has not been narrowed enough. The first three items of information are all that is required for most term life sales. Most consumers do not want and don’t need to get into a detailed conversation about their financial objectives or existing assets. Term life insurance is an important product that is already subject to numerous regulatory requirements that make it difficult to sell. These suitability requirements will only add to the difficulty of selling beneficial life insurance to consumers. The proposal establishes a new “best interest” standard for producers selling life and annuity products. While insurance producers are committed to providing the best possible products and services to their customers, Big I New York is still concerned that the language used in the proposal goes beyond imposing a “best interest” standard and is more akin to a fiduciary standard, which is not an appropriate standard for insurance agents selling simple life insurance products on behalf of their principal, the life insurance company. While the DFS did make a small change in the definition of “best interest,” the standard remains mainly the same and remains problematic. We appreciate that the DFS made changes to the provision which previously stated that every producer in the transaction, regardless of whether the producer has direct contact with the 18 December 24, 2018 / INSURANCE ADVOCATE

consumer, is subject to the entire regulation. The changes now require a producer to have participated in the transaction. However, we remain concerned about how every producer will that may be involved in a recommendation will be able to comply with all parts of the regulation. For example, it will be the producer that has contact with the customer that discusses suitability information with the customer. How does the producer who doesn’t have contact with the customer comply with the regulation’s suitability requirements? Is it sufficient that the producer with no contact with the customer ensure that the producer that has the contact has complied with the suitability analysis? The Department has split the definition of “transaction” into “sales transactions” and “in-force transactions.” Inforce transactions do not generate a sales commission, yet the Department still applies a best interest standard to these transactions. This doesn’t make sense if the Department’s

“Life insurance is not a uniform, one-size-fits-all product and coverage recommendations should not be regulated. Restricting how an agent communicates with his or her client does a disservice to that client.” primary goal for instituting a best interest standard is to avoid conflicted advice by producers. There is no conflict present when a producer is simply carrying out a transaction requested by the customer and no compensation is involved. The proposal includes new requirements on an insurer when it offers a fee-based version and a commission-based version of a policy, to provide to the consumer a comparison, in a form acceptable to the superintendent, showing the differences between the products. This requirement raises a question. What happens if only the fee-based version of a policy or only the commission-based version of a policy is available for sale by a producer because the insurer has restricted the version that the producer may sell? Is the insurer required to provide the comparison form when the producer working with the consumer is only permitted to sell one version? Ms. Muratori concludes: “While we appreciate the fact that the DFS strives to protect consumers who purchase insurance, we ultimately believe this regulation seeks to solve a problem that does not exist, and which will result in fewer life and annuity sales in New York, and fewer policies sold where the consumer has access to advice and recommendations from an insurance professional.” The case will be heard by a judge in the Third Judicial Department of the Supreme Court.[IA]

[ IN THE ASSOCIATIONS ]

(L-R): Barry Levy, Partner, Rivkin Radler; Ellen Melchionni, President, New York Insurance Association; Skip Short, member, Shory & Billy.

uThe New York Insurance Association hosted the New York Auto Forumâ&#x20AC;&#x201D;A Look at the Road Ahead on Wednesday, November 14, 2018. Auto insurance writers and insurance professionals heard from industry experts on a variety of trending topics. Skip Short, member, Short & Billy and Barry Levy, partner, Rivkin Radler shared colorful anecdotes from their many years as litigators in the fields of no-fault automobile insurance fraud during their presentation Stories from the No-Fault Battlefield & The Fight Against Fraud.

NYIA Provides Industry Roadmap at New York Auto Forum uRobert Sinclair, manager, media relations, AAA Northeast and Ben Lieberman, co-founder, Alliance Combatting Distracted Driving and Distracted Operators Risk Casualties talked about the latest research and efforts to address the current distracted driving epidemic during their Impact of Distracted Driving & Possible Solutions presentation. A talk on Trends in Auto Claims was given by Sandee Perfetto, coverage director, personal auto/umbrella product development, ISO where she discussed the challenges of auto safety and structure versus the advancements in technology and comfort including the latest on autonomous vehicles. The Fireside Chat with Legislators featured Senator James Seward, New York State Senate Insurance Committee Chair; Senator Neil Breslin, New York State Senate Insurance Committee Ranking Member; Assemblymember Kevin Cahill, New York State Assembly Insurance Committee Chair and was moderated by Kristofer Snader, senior director government relations at Nationwide. The participants gathered fireside to have a conversation regarding insurance trends and legislation, including topics of fraud, modernization, photo inspections and distracted driving. CONTINUED ON PAGE 22 20 December 24, 2018 / INSURANCE ADVOCATE

(L-R): Ben Lieberman, Co-Founder, Alliance Combatting Distracted Driving and Distracted Operators Risk Casualties; Kristofer Snader, Senior Director Government Relations, Nationwide; Robert Sinclair, Manager, Media Relations, AAA Northeast.

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THE NEW YORK INSURANCE ASSOCIATION SETS COURSE FOR 2019

The New York Insurance Association held its Annual Meeting on Thursday, November 15, 2018. The Annual Meeting is a yearly event that sets the course for the following year. NYIA’s officers and board of directors for 2019 were elected and as part of the Legislative and Regulatory committee meeting, NYIA members adopted the 2019 agenda. Members also heard compelling presentations from industry leaders and specialists. Tanisha Edwards, Governor’s Office, assistant counsel to the governor for taxation and financial services delivered an insightful keynote address to NYIA Annual Meeting attendees. In her talk Edwards discussed a variety of issues and emphasized the importance of collaborative approaches. Featured speakers Steven Groeschen, chief consulting actuary and risk analyst and Joseph Petrelli, president with Demotech, Inc. presented The Long View: Analysis of the New York State Property and Casualty Marketplace. Groeschen and Petrelli briefed NYIA Annual Meeting attendees on their complete analysis of multiline data in New York from 2000–2017. NYIA members reelected the following officers— chair, Elizabeth Heck, president and CEO, Greater New York Mutual Insurance Company; first vice chair, Mark Prechtl, executive vice president and CEO, Chautauqua Patrons Insurance Company; second vice chair, Charles Makey III, senior vice president, insurance operations, Merchants Insurance Group and Norman Orlowski, Jr., president/CEO, Erie and Niagara Insurance Association. NYIA members also elected board of directors to serve a three-year term ending December 31, 2021. Marc Craw of MLMIC Insurance Company and Jennifer Cavolo of Progressive Casualty Insurance Company were elected and Elizabeth Heck of Greater New York Mutual Insurance Company, Matthew Benedict of Midstate Mutual Insurance Company and Jaynine Warner of Farmers Group, Inc. were reelected to serve. [IA]

Ellen Melchionni, President, New York Insurance Association; Tanisha Edwards, Assistant Counsel to the Governor for Taxation and Financial Services, Governor’s Office; Marc Craw, Senior Counsel, MLMIC Insurance Company. 22 December 24, 2018 / INSURANCE ADVOCATE

(L-R) Jaynine Warner, Legislative Affairs North Atlantic; Sandee Perfetto, Coverage Director, Personal Auto/Umbrella Product Development, ISO.

(L-R) Kristofer Snader, Senior Director Government Relations, Nationwide; Senator Neil Breslin, New York State Senate Insurance Committee Ranking Member; Ellen Melchionni, President, New York Insurance Association; Kevin Cahill, New York State Assembly Insurance Committee Chair Assemblymember; Senator James Seward, New York State Senate Insurance Committee Chair.

Steven Groeschen, Chief Consulting Actuary and Risk Analyst, Demotech, Inc.; Elizabeth Heck, President and CEO, Greater New York Mutual Insurance Company; Joseph Petrelli, President, Demotech, Inc.

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BARRY Z ALMA

Private Limitations of Action Provision Enforced Ninth Circuit Affirms Summary Judgment Because Suit Was Filed Too Late uEvery first party property insurance policy contain a special provision that limits the time available for an insured to sue the insurer in the event a claim is rejected. The private limitations provision is usually less than the state’s statute of limitations and protects the insurer from stale claims. In Maxwell B. Williams And Claire N. Williams v. Travelers Home And Marine Insurance Company And Travelers Indemnity Company, No. 17-17368, United States Court Of Appeals For The Ninth Circuit (October 17, 2018) the Ninth Circuit was asked to ignore a private limitation of action provision. FACTS Maxwell and Claire Williams brought a diversity insurance coverage action seeking coverage under their homeowners’ policy after suffering a water loss at their residence in Las Vegas, Nevada. The Williamses appeal the district court’s grant of summary judgment in favor of Travelers Home and Marine Insurance Company (“Travelers”).

24 December 24, 2018 / INSURANCE ADVOCATE

No magic words are necessary to constitute a denial of further benefits; rather the limitations period is triggered by notification that the carrier has failed to fulfill its promise to pay a claim. In Nevada, a claim for bad faith must be filed within four years of the triggering event. A claim based on violation of statute must be filed within three years of the triggering event. Under Nevada law, an insured’s limitations period does not begin to run until the insurer “formally denies” liability or additional benefits. No magic words are necessary to constitute a denial of further benefits; rather the limitations period is triggered by notification that the carrier has failed to fulfill its promise to pay a claim. Here, the limitations period was triggered by Travelers’ October 5, 2011 letter, which stated that Travelers was closing the claim file because the Williamses had failed to cooperate with Travelers’ pre-

Barry Zalma, Esq., CFE, has practiced law in California for more than 42 years as an insurance coverage and claims handling lawyer. He now limits his practice to service as an insurance consultant and expert witness specializing in insurance coverage, insurance claims handling, insurance bad faith and insurance fraud almost equally for insurers and policyholders. He also serves as an arbitrator or mediator for insurance related disputes. He founded Zalma Insurance Consultants in 2001 and serves as its only consultant. Look to National Underwriter Company for the new Zalma Insurance Claims Library, at www. nationalunderwriter.com/ZalmaLi brary. The new books are Insurance Law, Mold Claims Coverage Guide, Construction Defects Coverage Guide and Insurance Claims: A Comprehensive Guide. The American Bar Association, Tort & Insurance Practice Section has published Mr. Zalma’s book “The Insurance Fraud Deskbook” available at http://shop.americanbar.org/eBus/ Store/ProductDetails.aspx?produc tId=214624, or 800-285-2221 which is presently available. Legal Disclaimer: The author and publisher disclaim any liability, loss, or risk incurred as a consequence, directly or indirectly, of the use and application of any of the contents of this blog. The information provided is not a substitute for the advice of a competent insurance, legal, or other professional. The Information provided at this site should not be relied on as legal advice. Legal advice cannot be given without full consideration of all relevant information relating to an individual situation.

[ ON MY RADAR ] vious two requests for inspection of the property and additional information in support of the claim. The letter notified the Williamses that Travelers was “closing [its] file,” and referred the Williamses to their insurance policy’s “Suit Against Us” provision, which set forth a two-year limitation period for breach of the policy. The letter put the Williamses on notice that Travelers would not make further payments on the claim. The only evidence the Williamses offered of any post-closure activity is Travelers’ July 7, 2012 letter, which advised the Williamses that Travelers did not have a record of the check it issued to them on May 26, 2011 being cashed. The letter did not indicate that any further consideration had been or would be given to the Williamses’ claim or that Travelers contemplated further payment. The Williamses filed suit on June 17, 2016—well over four years after the limitations period was triggered by the October 5, 2011 letter. DECISION The Williamses’ claims for bad faith and violations of statute were barred by the applicable statutes of limitation. Nevada has a six-year limitation period for general breach of contract actions. However, the Policy contains a two-year suit limitation provision. Suit limitation provisions are enforceable in Nevada so long as the period provided in the contract is a reasonable balance between the insurer’s interest in prompt commencement of action and the insured’s need for adequate time to bring suit. As noted above, the Williamses filed suit on June 17, 2016—over four and a half years after the limitations period was triggered by the October 5, 2011 letter. The Williamses’ breach of contract claim was barred by the two-year suit limitation provision. ZALMA OPINION The Ninth Circuit found the decision, as it should, a simple decision based on arithmetic. The suit was filed more than four years after the denial. The language of the policy was clear and easy to understand. The failure to file suit within four years of the denial was slothful and gave the court no basis to give the insureds’ the opportunity to sue their insurer.[IA]

[ IN THE ASSOCIATIONS ]

IBANY Announces 2018 Insurance Person of the Year uThe Insurance Brokers’ Association of the State of New York (IBANY) has announced that Elizabeth Heck, President and CEO of Greater New York Insurance Companies, is the 2018 Insurance Person of the Year. Each year, insurance professionals are asked to submit nominations for the Insurance Person of the Year. Nominees are individuals known for their level of engagement within the insurance industry, their positive contributions to the advancement to the industry, their encouragement and fostering of young professionals entering the industry, and participation in their community or charitable organizations. All nominations are presented to the Board who then votes to determine the recipient of the Award. Elizabeth Heck joined Greater New York Insurance Companies in 2001 and served as Chief Financial Officer before being named President and Chief Operating Officer in 2010. In 2015, she was named Chief Executive Officer. Ms. Heck began her career with one of the “Big Four” accounting firms, and went on to work for two national carriers, holding high-level financial positions prior to coming to Greater New York Insurance Companies (GNY). She is active in several insurance-related trade organizations holding board seats and officer positions, including the New York Insurance Association, the American Society of Workers’ Compensation Professionals, the New York Compensation Insurance Rating Board, and the National Association of Mutual Insurance Companies. Her philanthropic activities include Board membership on the Crohn’s and Colitis Foundation of America, which has cited her generous fundraising activities. As the honored recipient of the 2018 Insurance Person of the Year Award, Elizabeth celebrated at the 2018 Holiday Breakfast on Wednesday, December 12, 2018 at the Down Town Association in

Elizabeth Heck

Ms. Heck began her career with one of the “Big Four” accounting firms, and went on to work for two national carriers, holding high-level financial positions prior to coming to Greater New York Insurance Companies (GNY). New York City. Michael Chang, CEO of Sompo Global Risk Solutions, a strategic business unit of Sompo International, was the event’s guest speaker. [IA]

Serving New York, New Jersey, Pennsylvania and Connecticut Since 1889 www.insurance-advocate.com INSURANCE ADVOCATE / December 24, 2018 25

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[ COURTSIDE ]

LAWRENCE RO GAK

When Medical Provider Bills Under a “By Report” Code, Insurer Must Demand Supporting Documents if it Wants Them Pavlova a/a/o Cosby Reavis v Allstate Ins. Co. Edited by Lawrence N. Rogak In this no-fault suit, plaintiff medical provider billed for services under CPT code 20999, which is a “by report” code. The insurer denied the claim on the grounds that the provider did not supply documentation backing up the need for the services. The Appellate Term held that when a provider bills under a “by report” code, the insurer must use a verification request to demand backup documentation; it cannot simply deny the claim on the ground that the documentation was not submitted with the bill.—LNR

In this action by a provider to recover assigned first-party no-fault benefits, plaintiff appeals from an order of the Civil Court which denied the plaintiff’s motion seeking summary judgment to recover for services billed under CPT code 20999 and granted the defendant’s cross motion seeking summary judgment dismissing that portion of the complaint.

uAppeal from an order of the Civil Court of the City of New York, Kings County (Devin P. Cohen, J.). The order denied the plaintiff’s motion seeking summary judgment on so much of the complaint as sought to recover for services billed under CPT code 20999 and granted the branch of defendant’s cross motion seeking summary judgment dismissing that portion of the complaint. The order is modified by providing that the branch of defendant’s cross motion seeking summary judgment is denied; as so modified, the order is affirmed. In this action by a provider to recover assigned first-party no-fault benefits, plaintiff appeals from an order of the Civil Court which denied the plaintiff ’s motion seeking summary judgment to recover for services billed under CPT code 20999 and granted the defendant’s cross motion seeking summary judgment dismissing that portion of the complaint. As plaintiff failed to demonstrate prima facie that its claim for the services at issue had not been timely de-

nied (see Viviane Etienne Med. Care, P.C. v Country-Wide Ins. Co., 25 NY3d 498 [2015]), or that defendant had issued a timely denial of claim that was conclusory, vague or without merit as a matter of law, plaintiff failed to establish its prima facie entitlement to judgment as a matter of law with respect to its claim for these services. Consequently, plaintiff ’s motion for summary judgment on the portion of the complaint that sought to recover for these services was properly denied. It is undisputed that defendant denied plaintiff ’s claim for services billed under CPT code 20999 in its entirety. Because the workers’ compensation fee schedule has assigned a “By Report” designation for that CPT code, a provider billing under that CPT code is required to furnish certain additional documentation to enable the insurer to determine the appropriate amount of reimbursement. Plaintiff properly argues that where, as here, a provider does not provide such documentation with its claim form, and

28 December 24, 2018 / INSURANCE ADVOCATE

Lawrence N. (“Larry”) Rogak has been practicing insurance law since 1981. He has defended over 23,000 lawsuits and arbitrations and has represented over 75 different insurance companies and self-insured corporations. Lawrence N. Rogak LLC is listed in Best’s Recommended Insurance Attorneys, a distinction that requires written recommendations from at least 12 insurance carriers. A 1981 graduate of Brooklyn Law School, Mr. Rogak has published more books and articles on insurance law than any other New York attorney in the field.

the insurer will not pay the claim as submitted, 11 NYCRR 65-3.5 (b) requires the insurer to, within 15 business days of its receipt of the claim form, request “any additional verification required by the insurer to establish proof of claim” (see Bronx Acupuncture Therapy, P.C. v Hereford Ins. Co., 54 Misc 3d 135[A], 2017 NY Slip Op 50101[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2017]). Thus, defendant’s denial of payment for the services billed under CPT code 20999 on the ground that plaintiff had failed to provide sufficient documentation, where defendant did not demonstrate that it had requested any such documentation, was not proper and the branch of defendant’s cross motion seeking summary judgment dismissing so much of the complaint as sought to recover for services billed under that CPT code should have been denied. Accordingly, the order, insofar as appealed from, is modified by providing that the branch of defendant’s cross motion seeking summary judgment dismissing so much of the complaint as sought to recover for services billed under CPT code 20999 is denied.[IA] 2018 NY Slip Op 51654(U) Decided on November 16, 2018 Appellate Term, Second Department

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[ GUEST OPINION ]

JANE M. ORIENT, M.D.

Epidemics, Fear and Denial: How Every American Is Threatened uThis is the one hundredth anniversary of the great influenza pandemic of 1918. In his book The Great Influenza, John M. Barry described it as the deadliest plague in history. It killed more people in a year than the Black Death of the Middle Ages killed in a century. The lack of a vaccine did not cause the flu. All epidemics start with an index case—which may or may not be identified. The great influenza may have begun in a patient in Kansas. The significance of the case was reportedly recognized by a country doctor, who was ignored. As the nation mobilized for World War I, and draftees from across the country were thrown together, illness spread and became much more virulent. Transport ships became “floating caskets.” Troop trains were “rolling coffins.” But Woodrow Wilson denied the existence or severity of the epidemic, and effective public health efforts were thwarted. Despite this history, and the expenditure of billions of dollars, the U.S. is not much better prepared than in 1918. There have been warnings, such as Ebola, severe acute respiratory distress syndrome (SARS), novel H1N1 flu, and the 2014 outbreak of enterovirus D68 in schoolchildren. But when the threats recede, the nation goes back to sleep. When different populations are thrown together, as in boot camp or college dorms when new freshmen arrive, there is a lot of sickness. Each group has a different pattern of colonizing microorganisms to which its members have immunity and others do not. There are terrible historical examples of native populations in the New World being devastated by diseases of European settlers. Epidemics can happen naturally or through neglect—or they could be caused deliberately. Biological warfare is probably the very worst weapon of mass destruction. One scenario is to embed a suicide agent incubating a deadly disease in a mass of migrants. Or there are doubtlessly 30 December 24, 2018 / INSURANCE ADVOCATE

innocent persons infected with deadly diseases to which Americans have no immunity among thousands of migrants overwhelming our border—from Central America and many other places. The mainstream press and even part of mainstream medicine promotes denial. For example, an NBC News article quotes Dr. Paul Spiegel, who directs the Center for Humanitarian Health at Johns Hopkins School of Public Health: “There is no evidence to show that migrants are spreading disease.” The danger of introducing disease is “a false argument used to keep migrants out.” The article even quotes a study that purportedly shows that hepatitis, tuberculosis and HIV “generally only spread within the affected immigrant communities and not to the wider population.” Perhaps there is an invisible shield between an infected migrant and an American but not between him and someone newly arriving from his country? Is this denialism? No, that term is for those who don’t believe that we can change the climate and save the Planet by cutting off energy from the fuels that power 80 percent of the world’s economy. The supposed mainstream of media and organized medicine insists that “climate change”— catastrophic and human-caused—is the existential public health threat that eclipses all others. Let’s have uncontrolled migration, but tight global control of essential fuels. Is concern about the caravan just “fearmongering”? We don’t hear that term applied to those who say we must treat a child missing some mandated vaccines as a “Typhoid Mary” and bar him from schools or doctor’s offices—even though nobody ever caught a disease from a child that wasn’t infected with it. Rather, that’s the word for those who warn about tropical diseases, even if they are much more common and deadly than indigenous measles. Or for those concerned about

Jane M. Orient, M.D. obtained her undergraduate degrees in chemistry and mathematics from the University of Arizona in Tucson, and her M.D. from Columbia University College of Physicians and Surgeons in 1974. She completed an internal medicine residency at Parkland Memorial Hospital and University of Arizona Affiliated Hospitals and then became an Instructor at the University of Arizona College of Medicine and a staff physician at the Tucson Veterans Administration Hospital. She has been in solo private practice since 1981 and has served as Executive Director of the Association of American Physicians and Surgeons (AAPS) since 1989. She is currently president of Doctors for Disaster Preparedness. Since 1988, she has been chairman of the Public Health Committee of the Pima County (Arizona) Medical Society. She has authored numerous books and papers and is the editor of AAPS News, the Doctors for Disaster Preparedness Newsletter, and Civil Defense Perspectives, and is the managing editor of the Journal of American Physicians and Surgeons.

tattooed MS-13 gang members, rapists, jihadists, human traffickers, and other criminals intent on harming Americans. Such people also infect, molest, assault, or murder people in their own countries and in the caravan. Our nation faces real threats that produce genuine body counts from violence and disease. Instead, we are supposed to worry about carbon dioxide, invisible dust particles, and imperceptible phobias and isms. Not just worry, but shut down industries and shut out dissenters from public discourse. A wall is indeed proposed—to confine the half of America that votes the “wrong” way and wants to protect American lives, liberties, and property. We need an outbreak of common sense. [IA]

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