- Special Projects
Editor’s Note: This story is part of an ongoing series about Hawaii’s workers’ compensation system.
Annette Kanaulu was heading home to Ewa Beach from her job at The Queen’s Medical Center in October 2017 when she got a call telling her to turn around and go back.
It turned out her husband Kimeona, a custodian at Ewa Elementary School, had been found unconscious on the job and was being rushed to Queen’s.
Kimeona died later that evening of cardiac arrest.
Annette didn’t know much about Hawaii’s workers’ comp system, but on the advice of her husband’s colleagues at the school she filed for survivor’s benefits for herself and her teenage son.
That’s when the Department of Education’s workers’ comp unit got involved, launching Annette Kanaulu on an odyssey of denials and late payments that left her feeling angry and disrespected, even as she dealt with the loss of her husband. DOE still hasn’t paid her for funeral expenses.
“I don’t want to go through that again,” she said. “They make it like it’s your fault. They’re not very caring about people.”
The workers’ comp unit is supposed to help workers injured on the job, making sure that those with legitimate claims get the benefits and treatment they need to recover and return to work.
In many cases, it falls far short.
Civil Beat analyzed about 200 administrative decisions from 2013 to 2018 involving claimants who worked in the schools after hearing from workers’ comp insiders, such as attorneys and doctors, that the state Department of Education’s operation was unusually inefficient and hard on workers.
The decisions were handed down by hearing officers at the state Department of Labor and Industrial Relations, which administers the workers’ comp system.
The analysis found a number of recurring problems:
An internal audit in 2015 found sloppy record-keeping and inefficiencies by both the workers’ comp unit and the schools that report injuries to it. The operation relied on a manual process that the audit termed “time consuming and labor intensive.”
Claims managers, instead of assessing medical information and talking to doctors, were overwhelmed with clerical work.
Unlike other workers’ comp operations in the private and public sector, the DOE’s lacked in-house specialists such as vocational rehabilitation counselors, nurses and attorneys.
These inefficiencies led to delays for injured workers.
In 93 percent of cases, for instance, the initial report of the injury was made after the seven-day deadline laid out in statute, mostly when schools failed to forward the reports to the workers’ comp unit on time. The average time for the reports that failed to meet the deadline was 47 days.
Since that 2015 audit, the department says it has made changes to improve service.
Last year’s state budget authorized six new positions, three of them supervisors, DOE spokeswoman Lindsay Chambers said. It upgraded the technology used to track claims, increased coordination between offices to pay bills on time and started working more closely with vendors and others. In addition, the DOE is using new performance benchmarks to curtail service disruptions.
Yet Civil Beat’s review found many cases since 2015 involving the same shortcomings that were common before the audit.
In one recent example, the workers’ comp unit missed the seven-day deadline for rejecting a worker’s request for treatment by three months, and had to pay for massage treatments the department didn’t think were necessary. It told a worker in another recent case that there was no deadline to reimburse her for mileage, then didn’t attend a hearing in which a labor hearing officer disagreed and imposed a fine.
Relying on old medical exams, the workers’ comp unit argued that a teacher shot by a student in 1988 no longer suffered from post-traumatic stress disorder. The labor department disagreed and declared her permanently disabled, awarding her lifetime payments and $150 for the bullet wound scar.
A hearing officer required the DOE to pay one worker’s attorney fees after it failed to respond to the worker’s request for medical records. The workers’ comp unit said it had offered an injured worker light duty, but had no records to prove it, and so had to cover his disability payments.
It failed for several months to give a worker the results of a medical exam it had ordered the worker to attend and had to pay a fine and attorney’s fees. It admitted in the hearing that it had “no valid reason” for the delay.
It didn’t pay an injured worker $1,900 in living expenses and then didn’t show up at the hearing to explain.
The neglect and mistakes have taken a steep personal toll on some DOE workers who’ve filed claims.
Workers struggle to keep afloat without income or treatment, and describe feeling cast away by the employer they served.
“I can’t explain the hardship to you. I’m still in a hole,” said Bernadette Ishikawa, a special education aide whose payments were delayed for months. “You have to borrow money from this or that friend. It’s so embarrassing … They don’t care about people.”
Annette Kanaulu describes her husband Kimeona, the Ewa Beach custodian who died of heart failure, as a humble man who loved his job and never grumbled about anything. He also enjoyed yard work and did side jobs on the weekends. He’d had heart surgery when he was 12, but never any cardiac problems after that until the day he died at the age of 56.
He seemed fine when he and his coworkers went back to their stations after lunch that October day. Hours later, his boss found him on the ground. No one knew how long he’d been there.
The school was supportive. “They helped me all the way,” Annette Kanaulu said.
But when she filed the required form with the Department of Education, the workers’ comp unit rejected it without citing a reason.
At the ensuing hearing, the hearing officer and Annette Kanaulu, who had to take off time from work, both had all the paperwork.
Even though it was three months after her husband’s death, the DOE representative didn’t have any information on the claim – much to the consternation of the hearing officer, Kanaulu recalls.
After copying all the paperwork for the DOE, the hearing officer set a new hearing for a month later, and sent reminders to the parties three weeks before. Annette Kanaulu took time off work again.
This time, no one from the Department of Education showed up at all.
The hearing officer apologized to Kanaulu for wasting her time, and with no input from the DOE on a major case, issued a decision. The department was liable for death benefits for Kanaulu and one of their two sons still living at home, adding up to more than $260,000 to be paid in installments until 2041.
The DOE also was required to cover funeral and burial expenses of $12,690. The hearing officer told Kanaulu she should expect to hear from the workers’ comp unit about payments two months later, in April.
Spring came and went and Kanaulu heard nothing. In June, she contacted someone at the workers’ comp unit, who promised to get things going. A month later, when she still hadn’t been paid, Kanaulu called again. The claims worker said she’d forgotten to submit the paperwork.
“I said, ‘I’ll bet if it was your family, you wouldn’t have done that,’” Kanaulu said.
The death benefits finally started coming, although Kanaulu said they are often a week or so late.
But she still hasn’t been reimbursed for funeral expenses. (DOE said it could not comment on individual cases because of employee privacy laws.)
Jo Ann Kahoopii, meanwhile, is still waiting for the van that a labor department hearing officer ordered the DOE to pay for two years ago so she could get out of the house.
Kahoopii, a special education teacher, blew out her back in 2005 trying to help move a cooler that didn’t have wheels. Her condition worsened over the years, with swelling and hypersensitivity in the left leg confining her to a wheelchair. Her doctor says she is unable to perform daily tasks such as washing dishes and doing the laundry.
In 2016, the DOE argued that her impairments resulted not from the work accident, but from a dog bite in 2009.
The hearing officer didn’t agree. He ordered DOE to pay for a van so that she and her husband, Ralph, also disabled by a workplace injury, would not be housebound. The hearing officer also required DOE to pay for an attendant and temporary disability payments.
Because her husband also needed a van, the parties agreed that DOE would work with his employer, the Department of Transportation, to find one they could both use. Ralph Kahoopii said he found a van that could work and submitted the paperwork.
Then … nothing.
“Two years later and still no van,” Ralph Kahoopii said. (Jo Ann said she was not feeling well enough to talk to a reporter.)
The workers’ comp unit doesn’t return phone calls, he said. “They never answer their phone, never, from the case worker to the supervisor.”
A year after the hearing about the van, a different hearing officer found that DOE had not been paying Jo Ann Kahoopii all of her disability benefits and levied a fine of $441.
But no such remedy was possible for the van delays. A Department of Labor worker researched the statute and told the Kahoopiis that there’s nothing in the law that would authorize the department to fine the DOE for every day of delay in procuring the van.
So the Kahoopiis mostly stay at home. They didn’t go out on their 45th anniversary. For three years, they haven’t been able to join their in-laws for Thanksgiving, as they had been doing for 40 years. They can’t even drive up to the North Shore to watch the big winter surf.
“What they’re doing is deny, deny until they die,” he said.
Maureen Pescaia, an English and culinary arts teacher in Maui, injured her back and right leg when she fell in 2013.
She missed only a few days of work. But she did require extensive treatment, and so she went to a chiropractor.
The workers’ comp unit didn’t pay him for a year-and-a-half, Pescaia said, as his bills mounted to about $2,400.
“He was treating me for free,” she said. “Luckily, he’s a good man and a good friend and he did it.”
In 2017, Pescaia went to a hearing seeking a 20 percent penalty and attorney’s fees because her disability payments were late.
The hearing officer agreed, slapping DOE with a penalty of $4,647. The amount of attorney’s fees were not specified, but typically add up to several thousand dollars, workers’ comp lawyers say.
Pescaia anticipates that she will need neck surgery at some point. But given her experience so far, the idea of reopening her claim to get approval is daunting.
“I would imagine it’s an overwhelming amount of paperwork without anywhere near enough adjustors,” she said. “Or maybe they need to be better trained. I don’t know.”
The education department’s bumbling can even lead to new claims.
Ishikawa, the special education aide whose mileage payments were delayed, also claimed that she had to deal with late disability payments, which caused bank and credit card penalties, and delays in getting her prescriptions filled. The DOE didn’t pay her medical provider, which she feared could lead him to stop treating her.
All of this stress, she said, caused her pre-existing asthma to get worse, and her doctor agreed.
So did the hearing officer, who ruled that the DOE was on the hook for treating the aggravation of her asthma. The hearing officer also awarded attorney’s fees and costs for pursuing the late mileage payments, which added up to hundreds of dollars.
“It’s never-ending with them,” she said.
She feels bad that, because of the delays, she had to depend on her adult children. Her son, for instance, covered her share of the mortgage. And though he told her not to worry about it, Ishikawa said, “It’s a burden on me to have to depend on my children. It’s really difficult for me to ask for help.”
Justin Hughey, an elementary school teacher in Maui, injured his back in 2016 while trying to lift a case of copy paper into an overhead shelf. His bulging disc gave him so much pain that he lost 30 pounds, he said. He couldn’t muster the resolve to go to the refrigerator for a carrot.
Told that he might never be able to teach again, he started getting physical therapy. But the therapist cut him off after realizing that the DOE wasn’t paying the bills.
Hughey researched the DOE’s process for how to challenge unpaid bills. “I was trying to coach them through it,” he said. “They just didn’t want to go there. I understand that.”
The lack of therapy was particularly galling because he knew he had to show progress to get more treatment. He reluctantly got an epidural, so that he could stand doing physical therapy. When the unpaid physical therapist stopped treating him, it was all for naught.
“I was furious,” he said. “This is something I’ve been told I have to have to heal, and I’m not getting it.”
His chiropractor’s office, though, continued to treat him with massage, acupuncture and back adjustments even as the bills piled up.
The workers’ comp unit eventually paid for one chiropractic treatment after eight months. A massage session wasn’t reimbursed for a year. And one visit to the acupuncturist? It wasn’t paid until a year and four months later.
The DOE wouldn’t pay one bill because the name on the massage therapist’s license didn’t match the name on the bill. It turned out it had taken so long to receive payment that the massage therapist had been through a relationship change and switched her last name.
Mary-Lynne Ludloff didn’t get disability payments for more than a year after the DOE rejected her claim for severe back pain and sciatica.
Years earlier, after she tripped on a rock and injured her back, Ludloff had been forced to go to the U.S. Equal Employment Opportunity Commission to get the DOE to agree to provide her ergonomic chairs.
The school where she worked as a special education aide, Castle High School in Kaneohe, had not lived up to the agreement for years, she said. When the pain became too intense to go on, she filed a workers’ comp claim, mentioning the bad chairs as a cause.
In its rejection of that claim, the DOE focused on countering her complaints about the chair rather than the fact she was injured. The workers’ comp system is supposed to be “no-fault”—that is, in almost all cases, the causes don’t matter as long as the worker was injured on the job.
“The supply of your ergonomic chair is not a workers compensation issue but an employment issue,” a claims manager named Avena K-Aloha wrote.
The DOE asked the labor department for a 60-day extension to investigate Ludloff’s claim. Six months later, with Ludloff still not getting payments or treatment, it sent her to a medical exam with a doctor of its choosing.
In recent years, DOE has spent hundreds of thousands of dollars on so-called independent medical exams, or IMEs, including $629,000 in the 2017 fiscal year.
An earlier Civil Beat investigation found that many IMEs are used to cut off injured worker benefits. The IME doctors’ reports often claim workers weren’t injured on the job or don’t need treatment, even though a significant number are later discounted by neutral fact-finders.
As the months dragged on without treatment or the results of the IME, which would determine the DOE’s decision on whether to accept her claim, Ludloff relied on massages from her daughter. The daughter also taught her yoga poses to deal with her sciatica. She ran her credit cards to the limit, borrowed from her adult children and asked two grandsons who live with her to help with rent.
Finally, in November, she got the results of the IME. Even though the doctor had dated the report May 25, claims manager K-Aloha said she somehow didn’t get it until October.
With a labor department hearing on the horizon, the DOE finally accepted Ludloff’s claim and agreed to pay her for the 13 months since she made the claim and into the future.
“It hurts when you know you’ve been such a good employee,” she said. “I think that’s what hurts the most. This is what I get when I’m hurt and miserable. They don’t care.”
During a crisis like this, it’s more important than ever to dig beyond the news, to figure out what government policies mean for ordinary citizens and how those policies were put together.
For the first time, Civil Beat has become a seven-days-per-week news operation, publishing new stories and a new edition each Saturday and Sunday as well as weekdays.
This is perhaps the biggest, most consequential story our reporters will ever cover. And at no other time in Civil Beat’s history have we relied on your support more. Please consider supporting Civil Beat by making a tax-deductible gift.