Andrew T. Heath
Chairman
North Carolina Industrial Commission
Commission Overview
 Personnel Changes
 Commission Initiatives
 Rules Update
 Audit & Commission Response
 Fraud and Compliance Unit
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Statistics of Interest (FY 12/13)
 Roughly 160 employees; $16M budget
 73,295 workers’ compensation claims reported
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(10.7% increase from 66,193 reported in FY11/12)
10,389 settlement agreements, 6,294 administrative
motions and 1,569 medical motions reviewed
7,686 contested claims referred to mediation
75.1% mediation settlement rate
1,358 Deputy Commissioner hearings
497 appeals to the Full Commission
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Danny McDonald (term ends 4/30/15)
 Linda Cheatham (term ends 6/30/16)
 Bernadine Ballance (term ends 4/30/17)
 Tammy Nance (term ends 6/30/18)
 Andrew T. Heath (term ends 4/30/19)
 Charlton Allen (term ends 6/30/20)
UNC Asheville, B.S. Management
 Indiana University Robert H. McKinney School
of Law, J.D.
 Private Practice since 2006
 Workers’ Compensation Insurance Defense
with law firm of Hedrick Gardner Kincheloe &
Garofalo from 2009 until appointment in 2013
 Sworn in as NCIC Chairman 5/10/13
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Trinity College – B.A. History
 American University, Washington
College of Law
 Partner at Johnson, Lambeth & Brown;
Wilmington, NC, 3/06 – 6/13
 Hired as NCIC Administrator 6/10/13
 Chief Deputy Commissioner Effective
1/1/14
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Wofford College B.A. in Finance
UNC Wilmington M.B.A., M.S. in
Accountancy
Worked as Auditor for Ernst & Young, LLP
Worked as Accountant for Thompson,
Price, Scott, Adams & Co
Proficient in Generally Accepted
Government Auditing Standards
Effective 1/1/14
NC State University, B.S. Economics,
B.S. Business Management, M.P.A
 24 years of government experience,
primarily ensuring compliance by state
agencies and auditing entities that
receive state funding.
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Duke University, B.A. in Political Science
 Emory University School of Law, J.D.
 Insurance Defense Attorney for over 7
years
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University of Mumbai Medical College
 UNC Chapel Hill, B.A. in Political
Science
 Wake Forest University, J.D., M.B.A
 Assistant District Attorney for 4 years
 Partner at Stewart, Schmidlin, Bullock &
Gupta in Smithfield, NC
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Best practices.
 In every phase of your work process, identify best practices used in the private
sector, in other sections of the Industrial Commission, in other NC state agencies,
and in other state’s workers’ compensation systems. Once identified, apply them to
your work processes.
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Efficiency.
 Save time, resources and money. Do more with less. Wherever possible, search for
ways to reduce costs and make your processes more efficient.
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Service.
 Customer Service. Excellent customer service must be exhibited in every interaction
with stakeholders. Every NCIC employee should display a “how can I help you”
attitude at all times.
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Teamwork.
 Create a culture where employees work hard, but enjoy their time at work.
Encourage your employees to adopt a team mentality. Recognize your employees’
accomplishments and make them feel like they are an important part of the NCIC
team.
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In 2011, Session Law 2011-287 was
passed requiring the Industrial
Commission to subject all of its 152
rules to formal rulemaking procedure.
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10 of the Commission’s Rules were subject to
another round of legislative review during the
current legislative session.
The 10 rules are:
○ 04 NCAC 10A .0605
○ 04 NCAC 10A .0609A
○ 04 NCAC 10A .0701
○ 04 NCAC 10A .0702
○ 04 NCAC 10C .0109
○ 04 NCAC 10E .0202
○ 04 NCAC 10E .0203
○ 04 NCAC 10L .0101
○ 04 NCAC 10L .0102; and
○ 04 NCAC 10L .0103
Disapproval of NCIC Rules
Session Law 2014-77 was enacted on
7/22/2014. This law disapproved all ten
NCIC rules subjected to legislative
review and provided specific language
to be included in the new proposed
rules.
 This law also made changes to the
medical motion and emergency medical
motion procedures outlined in G.S. 9725.
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April 1, 2012 – When N.C. employers dodge workers’ comp costs, employees pay the price
April 1, 2012 – Two N.C. widows mourn lost husbands – and the lack of insurance, April 1, 2012
April 3, 2012 – N.C. Industrial Commission to review workers’ comp policies
April 4, 2012 – Gov. Bev Perdue wants fast action on workers’ compensation
April 19, 2012 – N.C. agency will force employers to pay injured workers
May 23, 2012 – North Carolina employers find mercy on workers’ compensation
August 13, 2012 – The Ghost Workers: Injured workers pay for employer’s gamble
August 18, 2012 – From the Editor: News & Observer digs into workers’ comp
August 19, 2012 – Tax-dodging companies hide among layers of subcontractors
August 19, 2012 – Struggling to stay in the United States, he feels invisible
August 19, 2012 – The Ghost Workers: Cheating businesses make it tough for honest employers
August 20, 2012 – The Ghost Workers: Inept bureaucracy lets dishonest businesses win
August 20, 2012 – States use SAS to find unpaid tax money
November 28, 2012 – Lawmakers say they will reverse course on worker comp law
December 13, 2012 – Legislators: Employers’ insurance data will be public again
December 26, 2012 – Advocates seek a safety net for injured NC workers
January 29, 2013 – Legislators suggest ways to detect workers’ comp insurance fraud
February 19, 2013 – Audit says Industrial Commission must ensure businesses carry workers’ comp
North Carolina State Auditor’s Office
conducted a Performance Audit of the
North Carolina Industrial Commission,
and released the findings and
recommendations in February of 2013.
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NCIC worked with Government Data Analytics
Center (GDAC), NC Division of Employment
Security, North Carolina Rate Bureau and SAS to
create a system to address each of the Auditors’
issues.
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NCIC created the Fraud/Compliance Section
NCIC added penalty and contempt dockets to its regular
rotation of non-insured dockets.
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SB 44 was enacted on 4/3/13 and provides that the
following information shall be publicly available from
the Commission:
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employer name and address;
carrier name, address, and telephone number;
policy number;
policy effective dates;
policy cancellation dates; and
policy reinstatement dates.
https://ccms.ic.nc.gov/insurancecoverage/inscov/insCoverageSearch
FRAUD AND COMPLIANCE UNIT
• Budget passed in July 2013 included
funding for an expanded Fraud and
Compliance Unit.
• Bryan Strickland was hired as the Director.
• Additional hires include:
• Deputy Commissioner
• Special Deputy Commissioner
• Compliance Officer
• Paralegal
• Two Administrative Assistants
FRAUD AND COMPLIANCE UNIT
Accomplishments (July 1, 2013 – June 30, 2014)
• 413 compliance cases opened outside of the recently launched
GDAC Alerting Tool. A majority of these are from NCIC Fraud
Hotline tips.
• 42 businesses obtained workers’ compensation insurance after
contact with our office.
• Penalty assessment orders issued against non-compliant
businesses totaled $758,895 in 2013-2014. Of these orders, 105
resulted in consent orders. This is a 139% increase from 20122013 to 2013-2014.
• Collected $285,103 in penalties as a result of consent orders. Of
the 105 employers assessed a penalty, 68 have paid in full.
• 601 Fraud Cases opened (447 Employer;146 Employee; 4
Insurance Company; 3 Attorney; 1 Medical Provider).
FRAUD AND COMPLIANCE UNIT
Accomplishments (Continued)
• 16 business owners charged criminally with Failure to Maintain
Workers’ Compensation Insurance. 2 individuals charged with
Obtaining Property by False Pretense.
• GDAC Alerting Tool went “live” on 4/14/14. The system has
generated a total of 5,015 total alerts. 584 cases have been closed
as of 7/24/14.
• Initiated a process to begin using the Debt Set-Off program with the
Department of Revenue. We have initiated this process with 69
cases totaling $857,057.33 in outstanding debt owed.
• Initiated a process to file judgments against noncompliant businesses
that have outstanding debts with the Industrial Commission.
FRAUD AND COMPLIANCE UNIT
To report workers’ compensation fraud:
Call Toll Free
(888) 891-4895 (in North Carolina)
Or Fax your Complaint to
Fax: (919) 715-0282
Or Email your Complaint to:
fraudcomplaints@ic.nc.gov
October 8-10, 2014
Raleigh Convention Center
Raleigh, North Carolina