Sunday, July 10, 2016

PFB Volumes Increasing and the OJCC Looking for Solutions

Florida's fiscal year closed on June 30, 2016. Now come some busy months during which various statistics will be compiled for the 2016 Annual Report. An astounding amount of time and resources are expended on the annual report each year. But, I am often able to answer people's workers' compensation questions by referring them back to the report. 

I began receiving questions about petition for benefit (PFB) volume when the Supreme Court rendered its decision in Castellanos on April 28, 2016. On June 1, 2016 I published a post outlining the petition and "new case" volumes for May 2016. That post received fair attention, and I received some additional questions about case volume, judicial and mediator workload, and whether the Office of Judges of Compensation Claims (OJCC) is prepared to handle the increased volume. 

Caveat number one is that no one as yet knows what the increase in PFB volume will ultimately be. Certainly, the figures for May 2016 indicate an increase, a significant increase of 24% over May 2015. Even before Castellanos, the PFB volumes for 2016 were trending upward, with each month of fiscal 2016 demonstrating some degree of increase. Some would suggest that increases in claims are a natural consequence (to some degree) of an improving economy, greater employment, more work hours, etc. 

Some safety people over the years have told me that injuries are statistically more common to new employees, as those on the job longer have more knowledge of safety protocols and procedures. The logic goes that as the economy improves, hiring increases. As new employees are added, their risk of injury due to lack of familiarity with equipment and processes may present greater risk of injury, and thus more claims. Some would argue that this explanation is more logical regarding accidents, however, than it is regarding litigation. The OJCC does not track injuries, only the cases that become disputes. 

Overall, at the end of April, 2016 the OJCC was projecting a 10% petition filing increase for 2016. The ten month period totaled 54,369 PFB compared to 49,479 for the same ten month period in fiscal 2015. Now, with the fiscal year closed, the total PFB volume for 2016 was 67,265 (this may vary a bit in weeks to come as the audit process concludes and some duplicates may be removed from the count). That compares to 60,021 in 2015, an increase of 12% for the year. 

In this context, it might be argued that Castellanos has yet to demonstrate a significant effect. The increase projected prior to that decision was 10%, the actual increase for the year is slightly higher at 12%. 

However, Looking at the figures for the entire year, the monthly increases in PFB volume averaged about 10% per month in 2016, over the ten months through April. But the increases in PFB volume in May 2016 was 24% and the increase in June 2016 was 21%, over the same months last year. If these significant monthly increases persist, there will certainly be a significant impact on the OJCC. If 20% increases remain consistent over the next 12 months, the total petition volume for fiscal 2017 could be over 80,000. 

The "new case" volume is also measured by the Office of Judges of Compensation Claims. In a particular case, an injured workers might file a single petition (“PFB”) or several. Thus, the PFB volumes may be a more relevant measure of litigation activity in the system, but may not provide a reliable measure of the rate at which cases are entering the litigation process. Conversely, “new cases” statistic measures only the appearance of a new injured worker/accident date into the process. This measure may more accurately describe the “frequency” of litigated claims, but provides little insight into the intensity of those claims (is it a claim in which litigation will be for a single benefit or many?). 

The "new case" volume in 2016 increased 4%, from 29,865 in 2015 to 31,178 in 2016 (fiscal year ended 06.30.16). The new case volume might also be arguably related to an improving economy and more employment. At the end of April, the OJCC was projecting a probable 3.5% increase in “new cases” for 2016. The last two months of 2016 demonstrated "new case" filing increases of 10% (May) and 8% (June) respectively. Thus, the post-Castellanos period did demonstrate increases that are more pronounced than the first ten months of 2016 demonstrated. 

Volumes are clearly increasing. This will certainly impact the OJCC clerically. Every new PFB filed requires a certain amount of effort and attention. Statistically, we might likewise expect some increase in the workload of mediators and judges. However, there is a natural rate of dismissal. Regardless of the gross volume of incoming petitions, some portion will resolve before mediation occurs, and still more before trial. With consistency and predictability provided by the trial judges, a great many attorneys manage to resolve a significant volume of disputes every day. 

We might validly predict that mediation volume will increase. This has not historically been a mathematically predictable corollary. In other words, it is difficult to predict either mediation or trial volume from the PFB or new case volumes. Certainly, the increased volume of petitions will impact the availability of mediation appointments opportunities. The OJCC used to have a one-to-one correlation between judges and mediators. In 2012, the Legislature unfunded one judgeship and four mediators from the OJCC. This has meant a leaner team, and has forced efficiency. However, consistent management has assured minimal impact on the public from this change, although the instance of telephonic mediation has increased as mediators from around the state have stepped in to cover calendars in distant districts. 

The OJCC affords its mediators significant latitude on scheduling mediations. Some mediators schedule a mediation every half-hour (9:00, 9:30, 10:00, 10:30, 11:00, 11:30, 1:00, 1:30, 2:00, 2:30, 3:00, 3:30, and 4:00) through the day; these mediation calendars thus afford 13 mediation opportunities each scheduling day. It is important to note that no one expects a meaningful mediation in 30 minutes; these mediators are counting on a volume of cancellations and thereby a more rational amount of time available per appointment. This is a rational expectation, based on the available data.

Other mediators schedule hour-long mediation appointments (9:00, 10:00, 11:00, 1:00, 2:00, 3:00, 4:00); these mediation calendars afford only 7 opportunities per scheduling day. In a macro-analysis, it is perhaps fair to conclude that the average mediation calendar affords 10 mediation opportunities daily. With 28 state mediators, we thus have available as many as 280 opportunities daily, in the current spectrum of paradigms. If all 28 mediators were to utilize the 13 appointment methodologies, that might increase to a high of 364 per day. 

As an aside, some might quickly ask why not start the day at 8:00 instead of 9:00 and open up more opportunities. The OJCC operates secure offices. Armed security has been a fixture now for more than 20 years. Unfortunately, we are limited to forty hours of security in each office. If we operated public hearings 8:00 to 5:00, there would be an hour each day that we were operating without security, and that would defeat the purpose of securing our offices for the safety of the public. 

There are 53 weeks in the year, and five workdays in each, yielding 260 days. Each mediator has a "personal holiday (-1 day), nine state holidays (-9 days), 176 hours of annual leave (-22 days) and 104 hours of sick time (-13 days). This leaves about 215 work days per mediator. This likewise yields between 60,200 (280 daily opportunities) and 78,260 (364 daily opportunities). So, in a perfect world of no calendar conflicts, the OJCC today can provide mediation appointments for the current level of PFB filing, and even those volumes projected in the near future. Notably, most mediation appointments involve issues in more than one PFB, and so the availability, or capacity, is certainly sufficient (even if we reach the 80,000 projection next year). 

However, parties will certainly experience less flexibility in mediation appointment availability in months to come. There appears to be little capacity in the system from the PFB perspective. Rescheduing will become a greater challenge as calendars become more congested. Attorneys should be reminded that this could lead to more telephonic mediation. Remember that the Rules allow for "voluntary" mediation with any of our state mediators. Attorneys may wish to be proactive in stipulating to coverage with telephonic mediators of their choosing around the state. 

If the four mediators eliminated in 2012 were returned to our team, this would increase capacity by 8,600 (4 x 215 x 10) to 11,180 (4 x 215 x 13). This would be significant. However, it would not provide sufficient resources in the event that PFB volume continues growing to the extent it returns to the volume in 2002-03 when 151,021 PFB were filed; roughly double the projected volume for fiscal 2017. At that volume, it will be impractical to believe that the state mediation appointments will be sufficient to efficiently accomodate all of the petitions. 

However, this is all not to say that OJCC mediators conduct this many mediations daily. In fact, when PFB volumes peeked in 2002-03 at 151,021, the total number of mediation conference held was 25,253, roughly 19%. In fiscal 2015, 60,021 PFB were filed and 15,421 mediations were held, roughly 26%. So the 28 state mediators last year (2014-15) conducted an average of 551 mediations each, or about 2.5 per day over those 215 workdays. There is obviously capacity in the OJCC system when viewed from this perspective. 

The conundrum between "mediation availability" and "mediations conducted" comes down to a conflict in preparedness and due process. The legislature has mandated that mediation shall occur within 130 days of PFB filing ("shall be held within 130 days after the filing of the petition," Fla. Stat. 440.25(1)). But, the mediation cannot be noticed until the petition is 40 days old. And, finally, the parties have to be given appropriate notice of the mediation, consistent with procedural due process (notice and opportunity to be heard). If not provided with sufficient notice, the chances of effective mediation decrease, and as a mandated event there is a sound argument that due process principles apply. 

Thus, the PFB is filed and no notice can be issued for forty days; and when noticed, the actual appointment is approximately 30 days in the future. So, the first available mediation date is about 70 days post-PFB filing and the deadline of 130 days leaves about a 60 day "window" within which to mediate the petition. The average 60 day period includes 16 weekend days and a holiday, leaving about 43 actual working days in that window. 

When do mediation appointments cancel? Fortunately, the deadline of a mediation conference seems to result in resolution of issues in workers' compensation. That is demonstrated by the low (2.5 daily) average volume of actual mediations. Unfortunately, that resolution seems to occur most often in the one to five days prior to the scheduled mediation. Thus, a mediator's calendar for a given week in August (30 days in the future) may be very full as of today. 

Thus, someone calling today in search of a mediation appointment in August may find no available appointments, or at least none that fit a particular set of parties' calendars. As the first week in August approaches, appointments open, as parties resolve their differences through the effort leading to the deadline of the scheduled conference. As these appointments cancel, however, it is difficult to reschedule them and provide parties appropriate notice. 

This illustrates a conundrum between providing sufficient resources (mediators, rooms, equipment, etc.) for a particular litigation volume and conducting a sufficient (efficient and effective) volume of mediations. 

Even currently, this comes to the surface periodically when mediation calendars become congested. This happens when mediators are ill or injured, depart for other opportunities, and therefore a vacant calendar has to be covered by other state mediators. When this happens, the volume of available appointments decreases. 

Similarly, increasing PFB volumes will result in less available appointment opportunities. The legislature has prepared for this. It has mandated that the 130 day deadline still be respected. However, if no state mediator is available to mediate the petition within that period, then "the parties shall hold a mediation conference at the carrier’s expense within the 130-day period set for mediation." Fla. Stat. 440.25(3)(b). I have been asked "why does the carrier have to pay?" The best answer I have is "because the law says so." For a more philosophical or factual answer, one should ask those who wrote the law. 

For now, it appears that resources are sufficient at the OJCC. But, should PFB volumes increase in coming months, there will soon be an insufficient volume of available mediator appointments available for mediation, and some volume of PFB will be involuntarily assigned to private mediation at the expense of the carrier. This will be frustrating with the knowledge that far fewer state mediations actually occur each day (2.5) than are scheduled (10-13). 

In anticipation of the coming volume changes, the OJCC will be actively working to find better solutions to the scheduling and mediation conundrum. This is not a problem unique to the OJCC. Service providers of all sorts have struggled with this for years. 

One solution might be to set more appointments each day. A mediator might be able to set as many as 16 (two each at 9:00, 10:00, 11:00, 12:00, 1:00, 2:00, 3:00, and 4:00). This arrangement, counting on the cancellations, might accomodate a sufficient volume of available appointments. It would create 96,320 (215 days x 28 mediators x 16 appointments). But, what if the three mediations that actually occur on a particular day are the two at 9:00 and one of the ones at 10:00. A congested and lengthy morning results, in which attorneys and parties are spending hours waiting for their turn. 

Another solution might be to notice mediations in "windows" as the cable company and other repair services do. In other words, your mediation will be either "between 9:00 and 12:00 on Monday, August xx, 2016" or "between 1:00 and 4:00 . . ." The mediator could then call a day or two before, when the calendar has cleared through resolution, and confirm a more specific time. This too would be inconvenient for people's planning. I well remember the days of calendars congested with discovery, state court hearings in non-workers' compensation matters, client meetings, and more. Then there are issues like that daycare deadeline for picking up the kids. Obviously, life can be complex and appointments can become conflicts. 

An third solution suggested to me is greater uniformity in OJCC mediator calendars. If all mediations were scheduled "on-the-hour" for instance, it would be fairly simple for a mediator in one office to step in telephonically to cover one of those conflicting 9:00 mediations in another. One attorney even suggested to me that mediators could be "teamed" together so that a particular mediation scheduled a particular day at 9:00 would be with "either mediator ONE or mediator TWO." This is intriguing. But, such an arrangement would likely require some volume of telephonic mediation, an arrangement which most mediators do not favor. 

In short, the facts seem to point toward increased filings. The chances of legislative relief are uncertain. And therefore, we as a community will be pushed toward solutions. The legislature has provided us one, carriers pay for private mediation. But, possibly, we can devise more rational methods for being more effective and efficient with the resources at our disposal? I am working on this and thinking of solutions. If you have solutions to suggest, email me at david.langham@doah.state.fl.us.

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