Some employers want to be friends with job applicants. And that’s a dangerous situation.

In an effort to get to know applicants better, some employers have started asking for potential employees’ Facebook passwords, so they can gain access to online posts and other information. The thinking is that this will really let the employer know a lot more about the people they may hire than a standard interview would.

This may sound like a good idea, but it is a volatile one.

First, privacy advocates are screaming that this is a massive violation of individual rights, and it is likely that companies that engage in this practice will receive some negative publicity.

But there are also legal issues in play.

According to the Associated Press,Senators Chuck Schumer and Richard Blumenthal of Connecticut have suggested that this practice is a violation of the federal Stored Communications Act or the Computer Fraud and Abuse Act, and are requesting the Department of Justice and the EEOC investigate the practice.  There are also states considering legislation that would prohibit such inquiries.  Having someone’s password gives you access to more than their posts.  It lets you read private correspondence and messages.  This, on its face, seems to be overreaching and an invasion of privacy.

But even if this practice is legal, is it advisable?  The answer to that question is likely no.  Facebook profiles and postings contain a gold mine of information, certainly.  But some of that information is material potential employers should not have and should not want to have.

Facebook postings can contain information on matters that employers are prohibited from asking about in an interview, such as age, religion and disability status.

“Great!” some employers think.  “This gives me data I want without having to directly ask about it!”

Well, that sounds good. But is it really?  Having this data also opens up employers to discrimination claims.  An applicant who is rejected for valid reasons could easily point to data on their Facebook postings that show they have a medical condition, or that they are over 40, and claim that is why the hiring decision was made.  Can employers eventually overcome that in court?  Maybe.  But why should they give plaintiffs that extra weapon to muddy up the water?

Employers have many perfectly legal tools to gather information on applicants that do not expose them to this potential level of liability and the expense of litigation, whether it is frivolous or not.

It seems that the best practice for employers is to be anti-social when it comes to social media and potential employees.

If Medicare compliance in liability settlements is not a concern for Defense counsel, it should be, because non-compliance can put clients and their attorneys at risk.  Medicare has an absolute right of reimbursement with regard to conditional payments, which means that it can recover from the Plaintiff, Plaintiff’s counsel, Defendants, and Defense counsel.  In addition, a client’s failure to report to Medicare a settlement, judgment, award, or other payment can subject it to large monetary fines.

Thus, Medicare is no longer a subject that only concerns the Plaintiff and his or her attorneys; it should be discussed by both sides and dealt with in the best way to protect all interests.  Below is a brief summary of information about Medicare compliance and strategies that Defense counsel, in particular, should be aware of when taking steps to protect their clients and their firm.

Early in the case, Plaintiff’s counsel should call the Medicare COBC (coordination of benefits contractor)-(800) 999-1118 and provide them with information regarding the alleged incident and injury in order to obtain a conditional payment letter.  A Conditional Payment Letter (“CPL”) provides information on items or services the Medicare Secondary Payment Recovery Contractor (MSPRC) has identified as being related to the pending Non-Group Health Plan (NGHP) claim. The conditional payment amount is an interim amount, and Medicare may continue to make conditional payments while a matter is pending. Consequently, the MSPRC cannot provide a final conditional payment amount until there is a settlement or other resolution. Once the case is established with the COBC, the Plaintiff’s counsel should receive a “Rights and Responsibilities Letter.”  An initial CPL does not need to be requested because it will be generated automatically within 65 days of the “Rights and Responsibilities Letter.”

There are two instances where a Conditional Payment Notice (“CPN”) will be sent out instead of a CPL:

  1.If the MSPRC is notified of a settlement, judgment, award, or other payment through Section 111 reporting rather than from the beneficiary or their representative; and

2. If the MSPRC has been alerted to a settlement, judgment, award, or other payment by the beneficiary or their representative before the usual Conditional Payment Letter (CPL) has been issued.

A CPN provides conditional payment information and states what actions must be taken because the MSPRC has been notified of a settlement, judgment, award or other payment.  Medicare allows 30 days for a response to the CPN before issuing a demand automatically requesting all conditional payments related to the case without a proportionate reduction for fees or costs.  Conditional payments are payments that Medicare has made in the past, prior to the date of settlement, for medical treatment related to the injuries at issue that must be reimbursed as a part of the settlement.  The conditional payment claims should be reimbursed within 60 days from the date of the formal demand letter.  Medicare should not be reimbursed before the formal demand is generated because the amount of such claims is subject to change until that time. If Medicare is not reimbursed within the 60-day timeframe, interest and penalties will begin to accrue.

Defense counsel should be aware of the Section 111 Reporting Requirements as established by 42 U.S.C.S. §1395(y)(b)(8).  The reporting requirements only apply to liability insurance carriers (including self-insured entities), no-fault insurance carriers, and workers’ compensation insurance carriers dubbed “RRE’s” or Responsible Reporting Entities.  Medicare has set up a process by which an RRE can send an early “query” file to determine beneficiary status.  The query file needs nothing more than the identity of the claimant-name, DOB, SSN, and gender.  If the Plaintiff is a Medicare beneficiary, the statutory duty to report is triggered after a settlement, judgment, award or other payment regardless of whether a determination of fault was made.  Failure of an RRE to report makes them subject to a penalty of $1,000.00 per day for each act of non-compliance.  For example, if an insurance carrier had 1,000 claims by Medicare beneficiaries, it could face a $1,000,000.00 a day fine for failure to report.

In summary, Defense counsel should discuss Medicare prior to and at mediation to make sure the Plaintiff’s counsel knows that without at least a conditional lien letter or letter from CMS stating there is no lien, the Defendant will not release the check without putting Medicare’s name on the check or obtaining a Consent to Release and waiting to get information from Medicare. The Consent to Release authorizes CMS to disclose conditional payment information, but it does not give the individual or entity the authority to act on behalf of the beneficiary or the right to further release that information.  In addition, Defense counsel should notify Plaintiff’s counsel that the Defendant will be reporting the settlement to Medicare to fulfill the Section 111 Reporting Requirements.  It is important to note that Medicare may not be made a party and is not bound to any agreement between parties and should the claimant fail to repay the conditional payment claims, Medicare may legally seek reimbursement from almost any party to the action, including the Defendant and/or the attorneys.

Defense counsel may also find it necessary to contact an outside Medicare Compliance Group to review the file and complete a Medicare Set-Aside Allocation Report to show that Medicare’s interests were protected in the Settlement Release in the following situations:

1.  If the claimant is currently a Medicare beneficiary and the total settlement amount is greater than $25,000; or

2. The claimant has a “reasonable expectation” of Medicare enrollment within 30 months of the settlement date and the anticipated total settlement amount for future medical expenses and disability/lost wages over the life or duration of the settlement agreement is expected to be greater than $250,000.

 A Medicare Set-aside (“MSA”) is money that is set aside for future medical expenses that would otherwise be covered by Medicare. MSAs are not required by law in any case. Rather, the Medicare Secondary Payer Act (MSPA) requires that the burden to pay for future medical expenses not be shifted to Medicare when another entity is primarily responsible for future medical treatment.  If Medicare is billed for treatment related to the alleged injuries in the future, it may refuse to pay for the treatment or may pay and then seek reimbursement.  If Medicare pays for treatment, it can seek reimbursement from almost any party to the action.  This absolute right of reimbursement is only one of the reasons; Medicare compliance is a hot topic among attorneys and their clients at this time.

As always, parties should consult with an attorney prior to entering into any settlement agreement which may involve Medicare’s rights.

Several new revisions to The Code of Judicial Conduct have been recently adopted by the Tennessee Supreme Court. One of the primary changes is the implementation of a new procedure for pursuing the recusal of a judge.   This new policy mandates that the judge that denies a request for recusal must now state the reasons for the denial in writing.  This change also provides a new method for seeking an expedited appeal if a motion for recusal is denied.   Litigants will now have the opportunity to appeal de novo to a higher court within 15 days of the judge’s ruling.  This will ensure that the challenged judge does not have the final word on recusal.  New rules also outline the process for the appointment of a new judge when a recusal is granted.

The revisions to the ethical guidelines for judges in Tennessee also attempts to eliminate the influence of large campaign contributions in judicial races. Tennessee judges can no longer preside over cases when either a litigant, their lawyer or law firm has made a substantial contribution to the judge’s campaign that would raise questions regarding a judge’s ability to remain impartial.  This new rule is one that was motivated by the United States Supreme Court ruling in Caperton v. Massey in 2009.  That case acknowledged the threats to public opinion of judicial impartiality that occur when judges preside over cases concerning their campaign supporters.

Judges are also now required to disqualify themselves from a case if they have previously presided over a judicial settlement conference or mediation in the same matter.

Chief Justice Clark stated, “We believe  these changes to the Code of Judicial Conduct will provide Tennessee judges with greater guidance for conducting the business of the courts in an impartial and ethical manner.”

These revisions to the Code were adopted by the Tennessee Supreme Court as a result of a petition filed by the Tennessee Bar Association in the hopes of ensuring judges remain neutral in their rulings.  The new Code of Judicial Conduct is to take effect on July 1, 2012.

Additionally, at the Annual Meeting, the Young Lawyers presented the Boys & Girls Clubs of Greater Memphis with a donation and Judge Jerry Stokes of Division VI of Circuit Court with the Chancellor Charles A. Rond Memorial Award for Outstanding Judge of the Year.

Abby Webb commences her tenure as President of the Young Lawyers Division

Beginning January 31, 2012, most private employers will be required to post information on employee rights under the National Labor Relations Act (“NLRA”).  This information is to be posted along other mandated postings, such as those describing minimum wages and rights under Title VII.  The requirement is a result of regulations promulgated by the National Labor Relations Board (“NLRB”)

Most private employers  (except very small ones) and most private employees are covered under the NLRA, with some exceptions, such as most governmental employees, agricultural workers, individuals employed by a spouse or parent, and, in most cases, supervisors.  The posting requirement applies to unionized and non-unionized workplaces.

The posting, among other things, informs employees of their rights to form a union, to collectively bargain, to discuss wages and benefits and other conditions of employment with co-workers or a union, or to choose not to join a union or take other collective actions, and gives employees contact information for the NLRB.

The posting also must set out various acts that are illegal by both employers and unions.  For example, the posting must state it is illegal for an employer to prohibit employees from talking about or soliciting for a union during non-break time, or from distributing union literature during non-work time in non-work areas such as parking lots and break rooms.  There are other specific requirements as to what the posting must contain.  Fortunately, the NLRB has a free, downloadable copy of the poster on its website, http://www.nlrb.gov/poster.

Many employers have criticized the new posting requirement, arguing that the rule is too pro-union, and that it is unfair for an unelected government agency to be able to mandate what employers must do.  Nonetheless, the rule will be in effect, and employers who fail to put up the required notice could be charged with an unfair labor practice.

As always, if you have any questions about whether or not your business should post this new notice, you should contact an attorney.

UPDATE:  This report has been updated to note that the posting requirement has been postponed until January 31, 2012.

Runaway juries.  Frivolous lawsuits.  Meritless claims.  Defensive medicine.  For years, we have all heard the reasons as to why some action needed to be taken to stem the tide of lawsuits being filed against the medical industry.  Now, by a convergence of forces never before seen in Tennessee, we will have the ability to compare, side-by-side, whether reducing the number of medical malpractice lawsuits or limiting the amount of money that can be awarded in medical malpractice cases will have the greater impact on the single best measure of either’s success – insurance rates.  My money is on reducing the number of lawsuits that are filed.  Here’s why.

When we say that we are going to reduce the number of “frivolous” lawsuits filed against doctors, nurses and hospitals, what we mean in practice is the development of a system that requires more effort on the front end by a potential claimant to investigate the validity of his claim, and to attempt an early resolution of that claim without filing a lawsuit.  In 2008, the Tennessee Legislature passed a statute that required just that.  In its simplest form, before a claimant can file a medical malpractice lawsuit, he must first notify the medical provider of his intent to do so and then wait for a period of 60 days before filing it.  This period of time is designed to give the parties a chance to work their differences out, if at all possible.  Then, if no resolution is reached, the claimant may file the lawsuit, but only if it comes with a certification by the claimant or claimant’s lawyer that the case has been reviewed by a suitable expert who has opined that a valid malpractice claim exists.

When first passed, some who analyzed the legislation were skeptical that it would have any impact on the number of lawsuits filed, many of which would ultimately have been dismissed on summary judgment because no competent expert would support the claim of malpractice.  One commentator even went so far as to call the pre-suit notice and certification concept “ludicrous.”

Fast forward to today.  As more data becomes available, it becomes more and more clear that the pre-suit notice and certification requirements imposed by the Legislature have been far more successful than anyone imagined.  The year before this statute took effect, there were 644 medical malpractice lawsuits filed in Tennessee.  As of September 30, 2009, the first full year of the new law’s impact, only 263 medical malpractice cases were filed, and in its second full year, only 313 cases were filed.  No matter how one analyzes these figures, no one can dispute the success of this approach on reducing the number of lawsuits filed against medical practitioners in this state.

Now let’s talk about capping damages awards, arguably the “holy grail” of the medical industry in Tennessee for years.  Limitations on damages caps, many argue, are necessary because we can no longer trust the jury system to be fair and reasonable.  Runaway juries are driving up the cost of malpractice insurance, they say.  Now let’s look at the facts.

In 2011, the Tennessee Legislature passed a tort reform law that limits the amount of non-economic damages that one may recover to $750,000 in all cases, including those sounding in medical malpractice.  Let’s see how many times that law would have been triggered during the 5 year period of 2004-2008.  During this time, there were 14,363 medical malpractice claims closed in Tennessee.  Of those, only 26 were closed by final judgment in favor a claimant.  Of that 26, only 4 had an award of $750,000 or greater in non-economic damages.[1]  Even if the limit is reduced to the $250,000 amount proposed by some members of the Legislature, there would only be 8 cases to which it would have applied during this 5 year period.  Those 8 claims represent less than six one hundredths of a percent.  Those to which a $750,000 cap would apply represent less than three one hundredths of a percent.  I think you get the picture, even with a cap of $250,000, limiting the amount of awards will not touch enough cases to produce a measurable impact on the malpractice climate in Tennessee.  Reducing by almost half the number of malpractice cases filed, however, did produce those results.

Now, the ultimate measure of success for either of these plans is the cost of insurance.  That’s where the rubber meets the road.  You reduce claims, you reduce rates.  State Volunteer Mutual Insurance Company represents the lion’s share of the doctors in Tennessee.  If you look at the company’s financial statements for the year following implementation of the pre-suit notice and certification statute, SVMIC reduced its rates by more than 20% and declared a $20,000,000 dividend.  I am anxious to see what type of impact that caps on damages will have after one year, if any.  Of course if premium costs are reduced there should also be a corresponding increase in the affordability and availability of quality healthcare to the citizens of Tennessee. Only time will tell.