State News

The Division has issued an updated list of health care providers restricted in the workers’

compensation system. The list includes enforcement actions against health care providers that

involve practice restrictions, doctors removed or suspended from the Designated Doctors List

(DDL), and health care providers removed from or denied access to the former Approved Doctors

List (ADL). Gary Pritchett, DC has been suspended from the DDL from 9/23/16 through 9/23/19.

Jerome Carter, MD was removed from the ADL indefinitely as of 9/20/16. Ray Altamirano, MD

was removed from the ADL through 7/19/18.

A full list of health care providers restricted in the workers’ compensation system can be found at

http://www.tdi.texas.gov/wc/hcprovider/status.html.

This event is by invitation only and is sure to be an important and fun event for system stakeholders.

If you would like an invitation and a chance to bid on some amazing silent auction items, contact

us here at the firm. There are trips to Napa, Cabo San Lucas, Marfa (star parties and gallery tours),

and Colorado, and other one-of-a kind items such as flight in a vintage T-34 “Mentor” Air Force

trainer. Visit www.kidschanceoftexas.org for more information. We are proud to announce that we

already have two scholarship recipients, Christi Campbell and Meghan Hill, who will be at the event

to receive their awards!

NEBRASKA NEWS

NEBRASKA SUPREME COURT 

In Interiano-Lopez v. Tyson Fresh Meats, 294 Neb. 586 (2016), the Nebraska Supreme Court determined counterclaims are not permissible in workers’ compensation cases.  In the case, claimant voluntarily dismissed his Petition, but the Court allowed the case to continue as the employer filed a counterclaim.  On appeal, the Court held that because counterclaims “are not part of the pleading scheme, there is no procedure enabling a plaintiff to admit or deny the substantial averments of a counterclaim, and no procedure by which a plaintiff can state his or her contention with reference to any additional matters in dispute as disclosed by the counterclaim.”  Further, allowing the suit to proceed on an employer’s counterclaim violates the claimant’s right to voluntary dismiss an action without prejudice before the final submission of the case to the court under Neb. Rev. Stat. § 48-177.

Practice Tip: Interestingly, while not judicially efficient, the Court did imply that the employer has the option of filing a Petition to determine the rights of the parties in lieu of filing a counterclaim.  So, if a case is not proceeding or claimant intends to move for dismissal without prejudice under Neb. Rev. Stat. § 48-177, the employer should consider filing a Petition. 

For more information regarding Nebraska news and updates please contact Jennifer Caswell orDanielle Jones in our Omaha, Nebraska office at 402.505.4630 or Jennifer.Caswell@Ritsema-Lyon.com and Danielle.Jones@Ritsema-Lyon.com.

Fall 2016 West Virginia Case Report and Workers’ Compensation Market Commentary

Supreme Court Report

The West Virginia Supreme Court of Appeals Court continues a trend of reporting decisions reflecting the privatization of the insurance market where multiple carriers have to determine compensability of preexisting injuries to current compensable claims, allocate charges from a claim among multiple employers, and calculate impairment from preexisting injuries.

One of the first cases argued before the West Virginia Supreme Court of Appeals in its September 2016 Term wasPioneer Pipe v. Swain, et al., No. 15-0397 (September 19, 2016), in which the Court adopted the OIC’s interpretation it is not mandated to allocate and divide charges for occupational hearing loss claims. The Court’s ruling confirms the OIC’s position allocation in hearing loss claims is a discretionary obligation in West Virginia which is in line with practice in a majority of states. The Court complained W. Va. Code 23-4-6b(g) is a “confusing, poorly-drafted anachronism, a vestibular flicker of the old workers’ compensation system” before privatization. The Court also noted its repeated recognition workers’ compensation law is a “miasma” that is a “sui generis, jurisdictional hodge-podge that stands alone from all other areas of the law, causing decisions rendered in the workers’ compensation arena to be almost wholly unusable in any other area of the law, and vice-versa.” Clearly four justices held their collective noses while making a decision where Pioneer Pipe is responsible for the entirety of a thirty-three year history of noise exposure for an employee with a mere forty hours of exposure at Pioneer Pipe. In her dissenting opinion, Justice Davis found the OIC’s policy injured Pioneer Pipe by denying its right to due process to make an individual determination of allocation on the merits, by preventing Pioneer Pipe from having other employer’s share in the “costs” of a hearing loss claim, and by prohibiting Pioneer from showing it should not be part of the case at all because the claimant worked only forty hours and not the sixty days as required by the statute.   

In the January Term of Court, two cases address compensability of preexisting injuries and the proper methodology for calculating preexisting impairment.

In syllabus point 3 of Gill v. City of Charleston, 783 S.E.2d 857, 858 (W. Va. 2016), the Court held:

“A noncompensable preexisting injury may not be added as a compensable component of a claim for workers' compensation medical benefits merely because it may have been aggravated by a compensable injury. To the extent that the aggravation of a noncompensable preexisting injury results in a discreet new injury, that new injury may be found compensable.”

In SWVA, Inc. v. Birch, 787 S.E.2d 664, 665 (W. Va. 2016), the Court held the proper methodology for determining preexisting impairment is to “deduct the impairment attributed to the preexisting injury from the final whole person impairment rating as determined under West Virginia Code of State Rules § 85-20.” This decision reflects continued reliance on the AMA Guides to the Evaluation of Permanent Impairment, 4^th Edition, and the impairment tables in Rule 20 of the Code of State Rules.

Market Commentary

Declining premium volume is a challenge for carriers as the West Virginia economy struggles with residual loss of business connected to the distressed coal mining and oil & gas industries and the continued economic recession. The workers’ compensation insurance market is sound. As reported by the National Council on Compensation Insurance (NCCI) at its 2016 State Advisory Forum, loss cost decreases continue in West Virginia for the 12^th year in a row. NCCI reported lost-time frequency continued to decline in 2016, but was higher compared with other states in the region. In a press release issued July 29, 2016, Governor Earl Ray Tomblin announced West Virginia employers will see a projected $36 million reduction in workers’ compensation premiums this year, and have seen a savings of more than $352 million since the privatization of workers’ compensation insurance in 2006. NCCI recently filed a proposed reduction of 14.7% in workers’ compensation loss cost rates with the Offices of the Insurance Commissioner. The loss cost rate is effective November 1, 2016. This is the 12th consecutive reduction since privatization and accounts for a cumulative decrease of 69.1% from pre-reform levels. A proposed 14.4% rate decrease for the assigned risk market also was filed by NCCI. Litigation trends also reflect the enduring impact of privatization with the September 8, 2016 report to the Industrial Council by the Office of Judges showing continuing decline in protests acknowledged by the OOJ: 2268 through August 31 compared to 3709 for 2015.

If you have questions or need more information, please call or e-mail Dill Battle at 304.340.3823 or hdbattle@spilmanlaw.com

H. Dill Battle III, Esq.

Spilman Thomas & Battle, PLLC

300 Kanawha Boulevard, E.

Charleston, West Virginia 25301
304.340.3823 - office
hdbattle@spilmanlaw.com

“The Calfee Corner” - Recent Successes Before the Industrial Commission of Ohio and Ohio Courts

Independent Contractors

In one of the few new decisions upholding independent contractor status, the Supreme Court of Ohio recently turned down the appeal of a “short haul” delivery truck driver seeking to be classified as an “employee” so as to be eligible for benefits under the Workers’ Compensation Act of Ohio.  In Barcus v Administrator, Ohio BWC (Franklin Cty C.A. Case No. 14-AP-942); app. denied2016-Ohio-467 (2/10/16), the State Supreme Court upheld lower court and Ohio Industrial Commission determinations that the relationship between driver Barcus and alleged employer CEVA Freight was an independent contractor relationship.

Barcus was a truck driver who delivered “home delivery” freight for CEVA Freight in a dedicated “short-haul” regional area.  Barcus was injured while working for CEVA and sought workers’ compensation benefits.  However, Barcus leased his truck to CEVA, signed an “independent contractor” agreement, was compensated on the basis of a percentage of the tariff for each load and not by the hour, and received a 1099 at the end of the year.  Barcus nonetheless argued that the “economic realities” were that he was merely an employee.  Barcus pointed to the everyday routine of his work; specifically, that he was assigned a group of customers that required delivery within a four hour window (albeit in any order that Barcus chose), that CEVA decals and logo were required on the side of his truck, that CEVA mandated a uniform, and that there were various CEVA training and other work requirements, including a drug test.

At an evidentiary hearing before the Ohio Industrial Commission, the alleged employer presented evidence of the independent contractor nature of the relationship and the services performed, including explaining that any apparent employer requirements were actually requirements passed along either from customers or from Department of Transportation (DOT) and/or Federal Motor Carrier Safety (FMCS) regulations.  The Ohio Commission denied Barcus’ claim on the basis that he was in fact an independent contractor.

Barcus filed an appeal to the trial level court in Franklin County, Ohio (Columbus).  Prior to a trial by jury on the merits, CEVA filed a motion to dismiss the case (summary judgment), supported by a transcript of the proceedings before the Industrial Commission demonstrating the evidence of the independent contractor relationship.  The trial court granted CEVA’s summary judgment motion. 

Barcus filed an appeal to the Ohio Tenth District Court of Appeals.  After briefing and oral argument, the appeals court upheld the trial court’s ruling.  The court’s decision relied upon the long standing “right to control” test and found that most factors pointed towards an independent contractor relationship (agreement of the parties; method of compensation; ownership and responsibility of the primary tool in question (the truck); right to refuse work).  The Court did note that the decal/logo and uniform requirements might point to an employment relationship, but found that these requirements were, in actuality, DOT requirements.  Furthermore, as the court noted, “as a practical matter, every contract for work reserves to the employer a certain degree of control to enable him to insure that the contract is performed according to specifications.”

Barcus filed a further appeal with the Ohio Supreme Court.  On February 10, 2016, the Court turned down the appeal.  This case can be put on the “short stack” of rulings finding in favor of an independent contractor status in our current legal climate.

Barcus was represented by M. Christopher Kneflin of Fox & Fox Co., L.P.A.; Ohio BWC was represented by Ohio Assistant Attorney General John R. Smart; William L. S. Ross and Christopher M. Ward of Calfee, Halter & Griswold LLP represented CEVA Freight.

Anthony Q (15-356755) -- Ohio jurisdiction found for California employee, (June 3, 2016). A Calfee client faced a tough workers’ compensation coverage situation -- it did not have coverage for its California resident employee who suffered an ankle/foot injury in the course and scope of his California employment for the Ohio-based employer.  Worse yet, the Ohio BWC order denying the claim on jurisdictional grounds was not appealed.

Not to worry.  We filed a motion for “Continuing Jurisdiction” asserting a “clear mistake of law or fact” based on there being sufficient contacts between Claimant’s California-based employment and the State of Ohio to allow for Ohio coverage.  Specifically, evidence was presented at hearing that the contract of employment was entered into in Ohio, Claimant’s work activities were directed from Ohio, he was paid from Ohio, the only state of available coverage was Ohio, and, perhaps, most significant, Claimant’s employment, while not localized in Ohio, did involve regular trips to the Ohio home office.  Thus at least some portion of Claimant’s work actually was performed in Ohio. 

Based on the foregoing, the Ohio Industrial Commission exercised its “Continuing Jurisdiction” and allowed the claim to the relief of both the Claimant and the Employer.

Scott P. (14-811966) -- Changing the theory of causation does not get the Claimant a second bite of the apple at the Industrial Commission. (April 6, 2016)

Mr. P is a delivery driver who fell from the back of his truck, hit his head, and cracked his ribs.  The claim was initially allowed for two rib fractures and an intracranial hemorrhage.  Later, the request for the additional allowances of concussion and post-concussion syndrome were granted.  Soon after came the request for psychological conditions -- “Depressive Disorder, Single Episode, Moderate” and “Adjustment Disorder with Anxiety.”  The theory of causation was that of direct causation.  In support of the allowances, Mr. P submitted a report from his examining psychologist.

In defense of these conditions, the Employer scheduled him for an examination with a psychologist of our choice.  To assist our examiner in making the determination of whether this condition was directly related to the allowed physical conditions received in the fall, we requested and obtained records from Mr. P’s primary care physician.  Our request encompassed records from several years prior to this incident.  In those records, we found that Mr. P, due to anger and anxiety, had been prescribed Xanax for several years before this incident -- a small detail that he forgot to tell his own examining psychologist.   

Based on the report from our doctor and the faulty history provided by the Claimant to his expert, the Industrial Commission denied the requested conditions by direct causation at all levels.  Soon after that denial, Claimant filed a new motion asking for the same conditions based on the theory that the allowed physical conditions “substantially aggravated his pre-existing psychological conditions.” When that new motion arrived at the District Hearing Officer level of the Industrial Commission, the Hearing Officer opined that the Industrial Commission lacked jurisdiction to adjudicate the request for “substantial aggravation of a pre-existing psychological condition” based onStarkey v. Builders FirstSource Ohio Valle, L.L.C., 130 Ohio St.3d 114, 2011-Ohio-3278 noting that, when a condition is in court on one theory of causation, the Industrial Commission cannot adjudicate that same condition based on a new theory of causation.  The request for substantial aggravation does not change the condition; just the method of causation and that can be litigated in court with the initial theory of causation. 

The denial of the psychological condition is now in Court on the Claimant’s appeal and hopefully, ripe for settlement of the whole claim.

Timothy H. 14-827371 --- Claimant cannot take a 7-year-old rotator cuff tear and turn it into a new tear. (October 2, 2015)

A factory worker, on 4/25/14, pushed a heavy lift device and chain and felt a pain in his right shoulder. The Self-Insured Employer certified the claim for a right shoulder sprain/strain. On 2/9/15, a motion was filed requesting that the claim be additionally allowed for “Supraspinatus Tendon, Substantial Aggravation of AC Joint Arthritis and Undersurface Osteophyte, Degenerative Changes in Right Shoulder Glenoid Labrum and Humeral Head.”  In a strategic decision, it was decided to take a court reporter to the District Hearing Officer hearing and obtain a more detailed medical history from the Claimant, as it was noted that the doctor providing  the causal for all of these conditions was not only his prior surgeon, but also a friend.

After obtaining a more detailed medical history, records were requested from the Claimant’s prior right shoulder surgeries, CD copies of the shoulder MRIs and X-rays.  The Claimant had several previous surgeries on the same rotator cuff -- failed surgeries.  The Claimant argued that prior to this incident there was “a strand” of rotator cuff remaining, and that “strand” was torn by this incident! To disprove this theory, the MRIs and X-rays were re-read by a radiologist specialist and a separate report was obtained from a medical doctor putting all the pieces together. Despite this, the Staff Hearing Officer additionally allowed the claim for “Supraspinatus Tendon, Substantial Aggravation of AC Joint Arthritis and Undersurface Osteophyte, Degenerative Changes in Right Shoulder Glenoid Labrum and Humeral Head.”

Upon review of this Order, an appeal was filed with the Full Industrial Commission.  A Commission appeal must be based on a mistake of fact or law.  The allowance of “Right Shoulder Supraspinatus Tendon” is not a diagnosis -- it is a body part.  Body parts are no longer recognized under Ohio law as conditions or diagnoses.  Further, the Staff Hearing Officer relied on the Employer’s report to allow these conditions -- a clear mistake of fact.  After a Hearing by the Full Commission, all of the requested additional allowances were denied, based on the Employer’s medical report and radiology review. The Self-Insured Employer will not be required to pay for a shoulder replacement under this claim --- a surgery that had been discussed years before this incident!

COURT DECISIONS OF NOTE

Violation of Specific Safety Requirement (VSSR)

In State ex rel. Armstrong Steel Erectors, Inc. v. Industrial Commission of Ohio, et al.,144 Ohio St.3d 243, 2015-Ohio-4525 (November 3, 2015), the Ohio Supreme Court denied Armstrong Steel Erector’s request for a writ of mandamus and upheld a VSSR award for the Claimant. The Claimant, Frank Seidita, was an ironworker who was working beneath a bridge decking on top of a concrete pier. Chain link fencing had been strung between piers to catch falling debris and to act as a safety net. Seidita was not wearing a safety harness or fall-protection equipment when he fell through a gap between the pier and fencing.

The Industrial Commission (“IC”) found that Ohio Administrative Code (“O.A.C.”) 4123:1-3-03(L)(1) and (3), regarding the use of safety nets, applied to the case and that it was impractical for the Claimant to use personal protective equipment (“PPE”) based on his testimony. The IC found a VSSR, and a magistrate subsequently agreed. In upholding the VSSR finding, the Ohio Supreme Court rejected the Employer’s unilateral-negligence defense based on the Claimant’s failure to use employer-provided PPE because it found that the Employer had not first complied with the applicable safety regulation requiring the use of safety nets.

In State ex rel. Precision Steel Services, Inc. v. Industrial Commission of Ohio, et al., 2015-Ohio-4798 (November 24, 2015), the Ohio Supreme Court granted the Employer, Precision Steel’s request for a writ of mandamus and vacated the Industrial Commission’s finding of a VSSR. The Claimant, Melvin Myers, was injured when a magnet holding a 1,200 pound piece of metal fell on his hand. The Claimant was operating a Kone XLD ten-ton crane with a magnet attached by wire rope to turn a metal piece he was welding. The wire rope holding the magnet had loops at both ends. The upper loop was attached to the crane, and the smaller loop at the bottom of the wire was attached via hook to the magnet. The hook holding the magnet did not have a latch or clip closing it.

The Industrial Commission found that O.A.C. 4123:1-5-14(G)(1) and 4123:1-5­15(B) applied because the Claimant was operating a power-driven crane. The IC found that the crane had “a defective safety device” because of the missing latch and that such defect required the crane be taken out of service. A magistrate reversed, finding that the cited rules did not provide notice to repair or replace a defective hook safety latch on a crane. The magistrate also found that the hook and safety latch were not “equipment” under 4123:1-5-15(A). The Ohio Supreme Court granted the employer’s writ, finding that neither 4123:1-5-14(G) nor 4123:1-5­15(B) specifically requires a latch to be attached to a crane hook. Therefore, neither rule placed the Employer on notice of a legal obligation to put a latch on a hoist hook, replace a latch on a hook if one is missing, or remove the crane from service because a latch was not on a hook.

Temporary Total Disability (TTD)

In State ex rel. Frank Strahin v. Indus. Comm., 2016-Ohio-1323 (10^th Dist. March 29,  2016), the 10^th District Court of Appeals affirmed denial of a writ of mandamus and denied the Claimant’s request for TTD compensation. The Claimant, Frank Strahin, was injured in the course and scope of his employment, and his claim was allowed for various left hip and leg conditions. He was released to work full-duty and continued to work full-duty with no restrictions for approximately three years. The Claimant also testified at IC hearings that he had begun “looking into” retirement during this period. He completed retirement forms in October 2012 and indicated his reason for separation was “retirement.” He did not check the provided box for “health” as a reason, and at the time of his separation he was working full duty. His retirement became effective November 1, 2012.

The Claimant argued that there was evidence that his retirement was medically-induced and that he was therefore entitled to TTD compensation. The Claimant saw his physician on October 2, 2012. His physician noted increased pain due to a “flare-up of his meniscus tear.” The Commission and 10^th district found this to be insufficient evidence. The Court noted that the Claimant testified at the IC hearings that he was contemplating retirement in June 2012, at which time he was working full duty with no restrictions.  The Claimant also testified that his retirement was motivated at least in part by upcoming changes to the PERS system. Finally, the Court noted that there were no records in the parties’ stipulation of evidence which would indicate that the Clamant was having any problems with his knee or receiving any supportive care for the knee in June 2012.

In State ex rel. Ritzie v. Reece-Campbell, Inc., et al., 2015-Ohio-5224 (December 16, 2015), the Claimant, Fred Ritzie, was seeking temporary total benefits under some very unique circumstances.  The Claimant was originally injured on November 10, 1994, and his claim was allowed for lumbosacral sprain, lumbar disc displacement, and postoperative infection. He returned to work light duty on September 25, 1995. He began treating with Dr. Brian Nobbs in August 2007, and he received temporary total disability (“TTD”) compensation and a 29% permanent partial disability (“PPD”) award over the next two years. The Claimant was then again injured in January 2010 while at work, and his 2010 claim was allowed for neck, upper back, and shoulder injuries. The Claimant settled then settled the 2010 claim on December 7, 2011. He continued lower-back treatments with Dr. Nobbs in 2011 and 2012, and Dr. Nobbs indicated that Claimant’s condition was “chronic but shown to improve with treatment.” In July 2012, the BWC additionally allowed three lumbar conditions in the 1994 claim, and the Claimant requested TTD beginning December 8, 2011 – the day after his 2010 claim settled – based on the new conditions.

The Industrial Commission found that he Claimant had not presented persuasive medical evidence of TTD as of December 8, 2011. It found that Dr. Nobbs’ report indicated the Claimant’s condition was improving and that it did not opine that the Claimant was disabled due to the allowed conditions in the 1994 claim. The appeals court denied the Claimant’s request for mandamus requiring the IC to pay TTD benefits beginning December 8, 2011. The Ohio Supreme Court then upheld denial of a writ of mandamus requested by the Claimant to award him TTD compensation and affirmed the appeals court, again noting that Dr. Nobbs’ notes indicated that the Claimant’s condition improved with treatment and that Dr. Nobbs did not indicate he considered the Claimant’s condition to have deteriorated to the point of TTD. The Court also reiterated that adding new conditions to a claim does not necessarily guarantee the payment of a new period of TTD compensation.

Permanent Total Disability (PTD)

In State ex rel. Boyd v. Scotts Miracle-Gro Co.., 146 Ohio St.3d 3, 2016-Ohio-1508 (April 13, 2016), the Claimant, Robert Boyd had an allowed claim for asbestosis in both lungs.  He then applied for PTD benefits and submitted a report of Dr. Marissa Mertz, M.D., as support.  The IC denied the PTD application based upon the vocational disability factors analysis of the medical reports of Dr. Shadel and Dr. Grodner, on behalf of the Employer and BWC, respectively.  The Claimant then filed a writ of mandamus, arguing that the Commission abused its discretion in relying on the report of Dr. Grodner arguing that “he was not qualified to give an opinion because he did not take x-rays of Boyd and he was not a certified “B reader.” 

The Ohio Supreme Court affirmed the appellate court’s judgment holding that the IC did not abuse its discretion in denying PTD to a worker suffering from asbestosis based on medical from a doctor who was not a certified B reader because IC Resolution R03-1-02, which requires evidence from a certified B reader, only applies to the initial allowance of an asbestosis claim. 

In State ex rel. Old Dominion Freight Line, Inc. v. Indus. Comm., Slip Opinion No. 2016-Ohio-343 (September 15, 2015), the Ohio Supreme Court found that the Industrial Commission’s failure to send the Employer’s medical reports to independent examining physicians before their examination of the Claimant was not prejudicial when the Commission subsequently provided those reports to the physicians. The Claimant, Robert Mason, was injured while working as a truck driver. He applied for PTD on 2007 but his application was rejected. He again filed his application in July 2009. The Employer informed the IC that it would be submitting medical evidence opposing the application. The Employer filed reports from Drs. Clary, Sterle, and Murphy regarding the psychological and physical conditions in the claim. The IC then set up the Claimant with its own physicians but did not send them copies of the Employer’s medical reports. The IC denied the Employer’s subsequent requests to depose its doctors. Instead, the IC submitted copies of the Employer’s reports to the appropriate doctors and requested an addendum report.

The Employer’s complaint alleged that the IC’s medical reports were flawed because their doctors did not review the Employer’s medical reports before examining the Claimant. The Supreme Court found that there was no dispute that the IC should have sent the Employer’s medical reports to their physicians but failed to do so, albeit in good faith. However, the Court found that the IC’s doctors presumably reached a PTD opinion based on their own exams of the Claimant and not the findings of other physicians. The Court found Employer’s prejudice argument to be speculative as to whether the IC’s doctors would have reached different conclusions had they been provided with the Employer’s medical evidence at first.

In State ex rel. Tradesmen International v. Industrial Commission, et al 143 Ohio St.3d 336, 2015-Ohio-2342 (June 24, 2015), the Ohio Supreme Court affirmed the court of appeals’ denial of the employer’s mandamus request. The Claimant, Raymond Smith, was injured while working for Tradesmen International in 2003. His claim was allowed for low back sprain, right shoulder sprain, cervical and left wrist sprain, right paracentral disc protrusion, chronic pain syndrome, and adjustment disorder with depressed mood. In 2011, the Claimant applied for PTD compensation and submitted a report from his treating physician, Dr. DePaz, which outlined activity restrictions; limited the Claimant to sedentary work; required “periods of continuous rest to control exacerbations of his back pain;” and found that the Claimant would not be able to maintain a regular working schedule. The Industrial Commission submitted two reports finding that the Claimant was incapable of working based on the allowed conditions in the claim. The Industrial Commission awarded the Claimant PTD compensation. The Employer filed for mandamus, alleging the IC abused its discretion when it ordered TTD compensation to begin on April 26, 2011, the date of Dr. DePaz’s report. The court of appeals denied the writ, finding that while Dr. DePaz stated that Claimant could perform sedentary work, he also outlined restrictions so narrow as to effectively preclude the Claimant from any sustained remunerative employment.

The Supreme Court upheld the denial of mandamus, rejecting the Employer’s argument that Dr. DePaz’s report failed to list the allowed conditions in the claim and stated that Claimant could perform sedentary work. The Court found that the IC knew Dr. DePaz was the Claimant’s treating physician and that his report referred to the Claimant’s back pain and various restrictions. The report contained no indication that DePaz considered any non-allowed conditions. As such, it was within the IC’s discretion to accept DePaz’s identification of back pain as referring to the allowed conditions in the claim. Although the report stated that the Claimant could work sedentary work, DePaz also included numerous restrictions and the entirety of the report therefore constituted evidence of PTD based on the medical factors alone.

In State ex rel. Lacroix v. Industrial Commission of Ohio, et al., 144 Ohio St,3d 17,  2015-Ohio-2313 (June 16, 2015) the Ohio Supreme Court affirmed denial of mandamus requested by the employee. The Claimant, Sherwood Lacroix, was injured in September 2007 while working as a dishwasher/baker/maintenance worker for GMRI, Inc. The claim was allowed for cervical/lumbar strain, head contusion, disc displacement, and postlaminectomy syndrome. The Claimant applied for PTD compensation in 2006 and 2008 but was denied both times. The Claimant again applied in 2010 with a report from his physician, Dr. Timothy Morley. However, Dr. Kiva Shtull examined the Claimant for the Employer, and found that the Claimant was capable of full-time sedentary employment while seated with the following restrictions: (1) ability to change position as necessary; (2) no foot pedal operation with lower extremities; and (3) no exposure to vibratory forces. Dr. Craig Johnston, Ph.D. then examined the Claimant and concluded that, based on Dr. Shtull’s report, the Claimant could perform sedentary work. The Industrial Commission denied the PTD application based on Dr. Shtull’s report, and the court of appeals denied the Claimant’s mandamus request.

The Ohio Supreme Court upheld denial of mandamus, rejecting the Claimant’s argument that Dr. Johnston’s report was flawed because he did not consider Dr. Shtull’s limitation that the Claimant must remain in a seated position, and Dr. Johnston listed potential jobs, such as security guard and cashier, that seemed impossible for a person who relied on a walker or wheelchair. The Court noted that a vocational expert need not list all restrictions when referring to a medical report and that the IC had the discretion to accept some or all of Dr. Johnston’s report.

Employment

In Onderko v. Sierra Lobo, Inc., Slip Opinion No. 2016-Ohio-5027 (July 21, 2016), the Ohio Supreme Court recently held that a worker does not have to establish that he or she suffered a workplace injury to establish aprima facie case of retaliatory discharge under Ohio Revised Code (R.C.) 4123.90.  The Claimant, Michael Onderko, was an engineering tech with Sierra Lobo, Inc., when he suffered an injury to his knee and was prescribed prescription pain medications to aid in his recovery. After the Claimant’s request for light duty work was denied, he filed a workers’ compensation claim. The parties disputed whether the injury occurred at work, and when Claimant’s claim was eventually denied by the Ohio BWC on the grounds that the injury did not occur in the course of his employment, he did not appeal the decision as he had already returned to work.

The Claimant was subsequently fired on December 12, 2012, for filing a deceptive workers’ compensation claim. The Claimant then filed a complaint alleging retaliatory discharge under Ohio’s workers’ compensation statute (R.C. 4123.90).  The trial court granted summary judgment to the Employer on the grounds that the Claimant had not suffered a workplace injury. The Sixth District Court of Appeals reversed, holding that a workplace injury was not required to state a claim of workers’ compensation retaliation.

The Ohio Supreme Court affirmed the Sixth District’s decision. The Court held that the plain language of the statute requires only that an employee file a workers’ compensation claim or institute, pursue, or testify in a workers’ compensation proceeding, but does not require an actual workplace injury.

R.C. 4123.90 states: “No employer shall discharge, demote, reassign, or take any punitive action against any employee because the employee filed a claim or instituted, pursued or testified in any proceedings under the workers’ compensation act for an injury or occupational disease which occurred in the course of and arising out of his employment with that employer.”

The Court reasoned that requiring an employee to prove he or she had suffered a workplace injury undermined the basic purpose of the workers’ compensation statute: to allow employees to exercise their rights without fear of retribution. Interpreting the statute in a manner that may leave employers free to discipline any employee who brought an unsuccessful workers’ compensation claim, the Court said, may produce a chilling effect on employees.  Thus, the Court made clear that theprima facie case of a claim for retaliatory discharge requires only that a plaintiff prove that he or she was discharged, reassigned, demoted, or otherwise disciplined in retaliation for filing a workers’ compensation claim or instituting, pursing, or testifying in a workers’ compensation proceeding.

As proof of a workplace injury is not required under the statute, the Court also rejected the Employer’s argument that failure to appeal the denial of workers’ compensation benefits foreclosed a plaintiff’s retaliation suit.  In response to the dissent’s concerns that the Court’s decision will encourage fraudulent workers’ compensation claims, the five-judge majority stated that employees who bring false claims or make misleading statements in an attempt to receive workers’ compensation benefits are subject to criminal penalties under Ohio law.  Following Onderko, employers should proceed with caution when disciplining an employee who has filed a workers’ compensation claim, even if the claim was unsuccessful, unless the Employer has other, independent justification for taking disciplinary action.

In State ex rel. Aaron’s Inc. v. BWC, Slip Opinion No. 2016-Ohio-5011 (July 20, 2016), the Employer was granted a limited writ of mandamus to order the BWC to explain why it had denied the company’s request that the BWC order reclassifying some of the company’s employees for purposes of workers; compensation premiums be applied solely prospectively. 

The Ohio Supreme Court affirmed the appellate court decision which concluded that the evidence in the record supported the BWC’s decision and that no internal policy of the BWC created a clear legal duty requiring the Bureau to apply the classifications solely prospectively.  Therefore, under this case, the BWC is recognized to have the authority to retroactively adjust the premiums it charged an employer to correct the employer’s improper classification of its employees, even without evidence of intentional wrongdoing. 

In State ex rel. WFAL Construction v. Buehrer, 144 Ohio St.3d 21, 2015-Ohio-2305  (June 16, 2015), the Ohio Supreme Court addressed the employee/independent contractor distinction for workers’ compensation purposes. In 2009, WFAL contracted with Ohio Fresh Eggs to repair barns. WFAL provided the labor and Ohio Fresh Eggs provided materials for the job. The BWC conducted an audit of the WFAL Construction during 2009. The audit was conducted to determine whether WFAL was required to report its payroll to the BWC for purposes of setting and collecting premiums. The BWC concluded from the audit that individuals working for WFAL were employees, not independent contractors and determined that, because WFAL improperly classified the workers, the company owed back premiums.

The Bureau’s adjudicating committee found the workers to be employees, noting that two workers’ compensation claims had been allowed against WFAL in 2009 and 2010, and that the Claimants were employees for workers’ compensation purposes. The court of appeals subsequently denied WFAL’s request for mandamus. The Ohio Supreme Court affirmed, finding that WFAL directed the workers; paid the workers every week based on timesheets; and that the workers were not at risk for a financial loss given the hourly nature of their wages.

RECENT DECISIONS OF THE FULL INDUSTRIAL COMMISSION

Injured Worker Permitted to file two separate “First Report of Injury” and pursue each

The Full Commission, by unanimous decision, vacated an SHO Order denying a Claimant’s 2014 claim asres judicata in light of the Industrial Commissions prior disallowance of the Claimant’s 2013 claim arising from the same incident. The Commission found that while the Claimant’s 2013 claim had been disallowed for the condition of “lumbar sprain” and was currently on appeal to the Court of Common Pleas, that did not preclude consideration of the Claimant’s subsequent request by way of a separate 2014 FROI for a different diagnosis arising from the same 2013 incident. The Commission found that the holding in Ward v.. Kroger Co., 106 Ohio St. 3d 25, 2005-Ohio-3560, 8730 N.E. 2d 1155, allowed for consideration of the compensability of a claim for a new condition, even when the claim has been previously disallowed with regard to a different condition. Accordingly the issue of the “disc bulge and arthropathy at L5-S1 and annular tears at L4-5 and Lr-S1,” as alleged in the subsequent FROI, were referred to the District Hearing Officer for determination on the merits.

Change in job requirements provides employee with an exception to the “coming and going rule

The Full Commission allowed an injured worker’s claim for injuries sustained as a result of an automobile accident that the Claimant was involved in when he fell asleep at the wheel of his car at 3:05 am after working a third shift.  The Employer appealed the claim allowance to the Industrial Commission arguing that the Claimant was a fixed situs employee and therefore subject to the “coming and going rule”. The evidence did support that at the time the Claimant was hired, and for the next year and a half, the Claimant was indeed a fixed situs employee and was not required to travel between stores.

However, in April of 2015 the Claimant was assigned additional duties by the Employer which required the Claimant to assist a team assigned to change cash registers at seven of the Employer’s locations between April and June of 2015.  During this time the Claimant would travel to other cities and assist in changing the cash registers. This was a two night process and the Claimant worked from 8:00 pm until 3:00 am each night. The Claimant was also reimbursed by the Employer for mileage as well.

The Commission found that the Claimant’s change in job duties created special hazards not faced by the public in general, including traveling long distances on the highway at 3:00 am after an 8 hour shift.  The Claimant’s additional job assignment was also found to be a benefit to the Employer, and but for this additional assignment the Claimant would not have been injured.  The Commission found that the Claimant had demonstrated a causal connection between his employment and the injury under the “special hazard exception to the “coming and going rule.”

Claimant fired for buying too much gas found to be pretexual termination and not job voluntary abandonment.  

The Commission found that a Claimant’s termination in October of 2015 for buying too much gas was not a voluntary abandonment of the workforce recognizing “the great potential for abuse” by Employers. The Commission scrutinized the Claimant’s termination and concluded that it was a pretextual termination.

The Employer alleged that the Claimant purchased more gas on two dates in July and August of 2015 that was the capacity of the Claimant’s vehicle. The Commission found that this issue however was not raised by the Employer until October of 2015;  was a “miniscule amount” of gas; and that the Employer had been paying the Claimant salary continuation during the month of September of 2015.  As such the Commission found that the termination was pretexual and did not constitute a voluntary abandonment of the workplace by the Claimant

NEWS FROM THE OHIO BUREAU OF WORKERS COMPENSATION

New BWC Administrator

As of May 2016, Sarah Morrison has been named by Ohio Governor John Kasich as the permanent Administrator and CEO of the State Fund for injured workers at the Ohio Bureau of Workers’ Compensation.  Morrison replaces Steve Buehrer, who left the Ohio Bureau of Workers' Compensation in April 2016. Morrison had been interim leader since his departure.  Morrison leads an agency with more than 1,800 employees that serves more than 250,000 employers.  "Sarah has been an important part of the BWC leadership team that helped drive our state's workplace injury rate below the national average and provide Ohio businesses with $4.3 billion in rate cuts, cuts, rebates and credits. I am confident she will build on that record of achievement and continue BWC's work to strengthen Ohio's business environment," Gov. John Kasich said in a statement.  Morrison had been the bureau's chief legal officer since 2012. She came to the agency after 15 years in private law practice.

Administrator Creates New Position Focused on Customer Service

In one of her first actions as the Administrator/CEO of the Ohio BWC, Sarah Morrison has directed her attention toward improving the overall customer experience with the Ohio BWC.  To those ends Administrator Morrison created a position entitled “Director of Customer Experience,” and has appointed Scottie Powell to fill the new position.  Director Powell is charged with using data to better understand the BWC customers to improve their experience and making processes simpler, faster and less expensive. 

Ohio BWC Cracks Down on Opioid Prescription

The Ohio Bureau of Workers’ Compensation Board of Directors approved a new opioid prescribing rule aimed at preventing opioid dependence and encouraging physicians to employ current best medical practices when treating injured workers with opioids.  Under the rule, the first of its kind in Ohio, BWC will not reimburse for opioid prescriptions written by physicians who fail to use best medical practices.  “We must ensure best practices are followed at the onset of an injury and throughout the course of treatment so injured workers receive care that improves their condition,” said BWC Administrator/CEO Sarah Morrison. “Ohio’s injured workers deserve the best possible treatment that addresses their medical needs without facing the life-changing consequences of opioid dependence or addiction.”

Best practices include the development of an individualized treatment plan, risk assessment and monitoring of the progress and improvement in function of the worker. The new rule strengthens BWC’s peer review process to address physicians who fail to comply with those practices. Corrective actions range from written warnings to removing the physician from BWC’s network of approved providers.

The new rule also allows BWC to provide treatment for opioid dependence that arises from the use of opioid medications covered by BWC. Treatment for dependence could include psychological counseling and medication assisted treatment for recovery.  The rule now moves to the Ohio General Assembly’s Joint Committee on Agency Rule Review. If approved there, it becomes effective Oct. 1 this year.

Ohio Unveils New “Other States” Coverage Option

In November of 2015, a new coverage option was approved by the BWC Board of Directors which hopes to simplify workers' comp for businesses with employees who work in other states. Workers' comp laws vary by state and the new Other States' Coverage will help ensure that Ohioans injured on the job will be covered regardless of where they are injured.  While BWC generally provides coverage for employees working temporarily outside of Ohio, complications can arise when the injured worker files a claim in another state by contracting with an insurer licensed in other states, BWC will be able to offer an option that ensures proper coverage regardless of jurisdiction. A law enacted in 2014 granted BWC the authority to contract with an insurer to provide this coverage, the board approved the rules governing the optional policy offering designed by BWC in November 2015, and the policy in now in place and over 100 policies have been issued as of July 2016.

NEWS FROM THE OHIO INDUSTRIAL COMMISSION

February 2016 Rule Amendments

The Industrial Commission has recently reviewed nine administrative rules, and recommended the following three amendments:

·        O.A.C. 4121-3-16 (Motions): Removes current O.A.C. 4121-3-16(E), which provides for motions to include legal citations and renumbers the remaining subsections.

·        O.A.C. 4121-3-22 (Inspection of Claim Files): Removes current O.A.C. 4121-3-22(B), which sets forth requirements for accepting an authorization on behalf of an injured worker which lacks the claim number, removes current O.A.C. 4121-3-22(E)(F)(G) and (H) which contained requirements related to physical inspections of claim files, and renumbers the remaining subsections.

·        O.A.C. 4121-3-30 (Emergency Hearings): Amends current O.A.C. 4121-3-30(B)(2) and (C)(2) to provide that the hearing administrator and Commission shall contact the parties and attempt to reach an agreement regarding the date and time of an emergency hearing before scheduling the hearing.

The Commission determined that O.A.C. 4121-3-17 (Briefs), O.A.C. 4121-3-18 (Administrative Appeals), O.A.C. 4121-3-21 (Change of Address), O.A.C. 4121-3-24 (Fee Controversies), and O.A.C. 4121-3-31 (Waiver for Recreational Activities) did not require any changes.

New Hearing Officer Manual

After a year and a half of review, the Commissioners of the Ohio Industrial Commission have finalized the revisions to the Hearing Officer Manual, which is effective as of August 15, 2016. The updated version is now entitledAdjudications Before the Ohio Industrial Commission.  Several memos have been moved and new memos have been added and it can be found at

https://www.ic.ohio.gov/policies/adjudications_before_oic/adjudications_before_oic.pdf

LEGISLATIVE NEWS

Ohio’s New Medical Marijuana Law to have little impact on the Bureau of Workers’ Compensation.

House Bill 523, effective September 8, 2016, legalizes medical marijuana in Ohio for certain medical conditions, including pain that is either chronic and severe or intractable, PTSD, and traumatic brain injuries.  At this time, the only legal forms of medical marijuana will be edibles, oils, patches, plant material and tinctures.  Vaporization is permitted.  It cannot be smoked or combusted.  Home growth is prohibited.

The impact of the new law on BWC and its programs is limited.  It does not adversely affect the Drug-free Safety Program, will not require BWC to pay for patient access to marijuana, and expressly states that an employee under the influence of marijuana is not covered by workers’ compensation. 

Specifically:

·        Nothing in the law requires an employer to accommodate an employee’s use of medical marijuana;

·        The law does NOT prohibit an employer from refusing to hire, discharging, or taking an adverse employment action because of a person’s use of medical marijuana;

·        The law specifies that marijuana is covered under “rebuttable presumption.”  In general, this means that an employee whose injury was the result of being intoxicated or under the influence of marijuana is not eligible for workers’ compensation.  This is the case regardless of whether the marijuana use is recommended by a physician;

·        While the law does not specifically address reimbursement for medical marijuana recommended for injured workers, Ohio law already has rules and statutes in place that limit what medications are reimbursable by BWC.

o   Administrative code provides that drugs covered by BWC are limited to those that are approved by the United States Food and Drug Administration.  Marijuana has not been approved by the FDA and remains and Schedule I illegal drug under federal law.

o   BWC-funded prescriptions must be dispensed by a registered pharmacist from an enrolled provider.  Medical marijuana will be dispensed from retain marijuana dispensaries, not from enrolled pharmacies.

o   BWC only reimburses drugs that are on its pharmaceutical formulary, which is a complete list of medications approved for reimbursement by BWC.  Drugs not on the list are not eligible for reimbursement, and under BWC’s current rules, it cannot be included in the formulary, nor is it otherwise eligible for reimbursement. 

“I’m just a Bill...yes I’m only a Bill”

House Bill 207 becomes Law!

House Bill 207 made its way into law this past Summer, effective August 31, 2016, after being signed by Governor Kasich. The new law addresses workers compensation claims involving vehicular accidents and also tackles issues involving self insured employers.

With respect to workers’ compensation claims that involve vehicular accidents, the new law:

·        Requires workers’ compensation claims to be charged to the Surplus Fund Account in lieu of to a state fund employer’s experience in certain circumstances when a claim is based on a motor vehicle accident involving a third party.

·        Allows a state fund employer who believes that a claim may qualify to be charged to the Surplus Fund Account under the act to file a request with the Administrator of Workers’ Compensation for a determination.

·        Requires the Administrator to make the determination within 180 days after the Administrator receives the request.

·        Requires any amount collected by the Administrator through the subrogation process for compensation or benefits that were charged to the Surplus Fund Account to be credited to the Surplus Fund Account and not applied to an individual employer’s account.

With respect to self insuring employers, the new law:

·        Eliminates the minimum number of employees required for a private sector employer or board of county commissioners to obtain self-insuring status under the Workers’ Compensation Law.

·        Requires a self-insuring employer who resumes paying premiums to the state insurance fund to provide the Administrator with any information that the Administrator may require to develop a state fund experience modification factor.

·        Requires, if a professional employer organization agreement is terminated, a self-insuring professional employer to provide the Administrator with information that the Administrator must use to develop a state fund experience modification factor for each client employer formerly subject to the agreement.

House Bill 205 “...is still a just a Bill...”

House Bill 205, sponsored by Rep. Mike Henne (R-Clayton) and Rep. Wes Retherford (R-Hamilton) would modify the requirements for an employer to allow them to become a self-insuring employer for purposes of the Workers’ Compensation Law, to transfer authority over the workers’ compensation self-insurance program to the Superintendent of Insurance, and to allow certain employers and groups of employers to obtain workers’ compensation coverage from a private workers’ compensation insurer.  The bill is has been assigned to the Senate Insurance Committee and has not seen any movement since the early part of 2016.   

ability to retain counsel under a contract that calls for the payment of a reasonable fee by a claimant (or someone on his or her behalf), are unconstitutional violations of a claimant’s right to free speech, free association, and petition....as well as to form contracts...[t]hus we hold that the criminal penalties of section 440.105(3)(c)...are unenforceable against an attorney representing a workers’ compensation client seeking to obtain benefits under Chapter 440..”

NOT TO SAY IT IS THE FIRST TIME THIS HAS
EVER HAPPENED BUT IT VERY WELL MIGHT BE:
CLAIMANT COUNSEL APPEALS STATE WORKERS’
COMPENSATION CASE TO THE UNITED STATES SUPREME COURT
Daniel Stahl v. Hialeah Hospital and Sedgwick Claims Management
Petition for Writ of Certiorari / United States Supreme Court / Case No. 16-98

Mr. Stahl suffered a workplace accident on December 8, 2003. Workers’ compensation litigation commenced July 12, 2004 and persisted until Florida’s First District Court of Appeal issued its written opinion on March 25, 2015 and its mandate on April 30, 2015. During that period the case had made its way to the First District Court of Appeal several times without there ultimately having been a resolution acceptable to claimant. The court, having seen a number of appellate filings in this claim over the years, issued an opinion March 25, 2015. The court set out the issues as follows: did (1) the 1994 addition of a $10 copay for medical visits and (2) the 2003 elimination of permanent partial disability benefits render Florida’s workers’ compensation law an inadequate exclusive replacement remedy for a tort action. The appellate court found that it did not, stating that “[w]e disagree, because both amendments withstand rational basis review, in that the copay provision furthers the legitimate stated purpose of ensuring reasonable medical costs after the injured worker has reached a maximum state of medical improvement, and PPD benefits were supplanted by impairment income benefits. Thus the appellate court affirmed the decision of the Judge of Compensation Claims.

Stahl’s Petition for Certiorari to the United States Supreme Court posits three issues: (1) whether the U.S. Supreme Court should exercise its jurisdiction to review Stahl’s case based on the proposition that the “Grand Bargain” is no longer a bargain; (2) whether Florida’s workers’ compensation law deny injured workers due process by establishing an arbitrary system that provides inadequate benefits; and (3) does the Florida workers’ compensation system provide an insignificant level of benefits so as to violate the United States Constitution’s Fourteenth Amendment’s substantive due process requirement. The Petition for Certiorari itself covers 35 pages with an appendix that covers the Stahl and Westphal cases discussed above. Whether, what and when the U.S. Supreme Court will take its next action remains to be seen. As of the drafting of this discussion, claimant’s petition for writ of certiorari, three amicus curiae briefs, and an order extending time for a response to the petition to September 21, 2016.

Consider this situation:  Company A voluntarily pays approximately $172,000 in medical and temporary disability benefits to Worker.  Company A demands reimbursement from Company B believing that Company B is the true employer.  Worker never files a claim petition against Company A or B.  Can Company A file a claim petition in the name of Worker and recover from Company B all $172,000 that Company A voluntarily paid?            

That is the issue in Diocese of Metuchen, a/s/o/ Elissa Martinez v. Sisters of the Immaculate Heart of Mary, A-1441-14T4 (App. Div. Sept. 6, 2016).  It is the most interesting decision in many decades to come out of New Jersey on the right of a company to seek reimbursement from another company in a non-PIP situation through the Division of Workers’ Compensation.

Elissa Martinez was severely burned in the face, neck and torso while working as a cook at the convent of the Sisters of the Immaculate Heart of Mary (IHM).  The convent, a high school, and an elementary school are part of the Immaculate Conception Church, all owned by the Diocese of Metuchen.  Martinez was hired by the Mother Superior of IHM to cook for a net wage of $175 per week by checks issued by IHM.  The Mother Superior directed the activities of Martinez.  IHM issued a W-2 tax form to Martinez but clearly believed that Martinez was an employee of the Diocese.

The financial relationship of the Sisters at IHM and the Diocese is unusual because the sisters take a vow of poverty.  Hence, no individual sister receives a check.  However, the Diocese pays a stipend for each sister to IHM, which then allocates an amount per month to the sisters of the convent for their living expenses.  An extra stipend of $600 per month also was paid to IHM by the high school and the elementary school.  This stipend, however, was stopped after the accident to Martinez.

After Martinez’s accident, IHM notified its workers’ compensation carrier and the Diocese.  The Diocese paid Martinez’s medical and temporary disability benefits on a “charitable basis.”  Thereafter the Diocese demanded that IHM’s workers’ compensation carrier immediately assume responsibility for making all payments.  When that did not happen, the Diocese filed a workers’ compensation claim on Martinez’s behalf underN.J.S.A. 34:15-15.1  The Diocese denied that Martinez was its employee, and IHM also denied that Martinez was its employee.

As part of the claim petition which the Diocese filed, a motion was also filed to require IHM’s carrier to accept the claim and pay benefits.  The medical provider, St. Barnabas Medical Center, also intervened seeking repayment of $399,017 for in-patient hospital services paid to Martinez.  The Judge of Compensation heard testimony and ordered IHM’s carrier to reimburse the Diocese and pay outstanding medical bills, as well as make payment of $50,000 for counsel fees and pay permanent disability benefits to Martinez.  It is important to note that Martinez herself never filed a claim petition in this case.

The first issue which IHM raised was jurisdiction of the court to hear this case.  The Appellate Division agreed with the Judge of Compensation that the Division had jurisdiction to handle a claim filed by one entity on behalf of a petitioner for reimbursement of benefits.  That conclusion flowed from N.J.S.A. 34:15-15.1 which allows claims for reimbursement to be filed when benefits “have been paid by any person, organization or corporation on behalf of such petitioner.”  This provision is a little known part of the New Jersey Workers’ Compensation Act:

Whenever the expenses of medical, surgical or hospital services, to which the petitioner would be entitled to reimbursement, if such petitioner had paid the same as provided in section 34:15-15 of the Revised Statutes, shall have been paid by any insurance company or other organization by virtue of any insurance policy, contract or agreement which may have been procured by or on behalf of such petitioner, or shall have been paid by any person, organization or corporation on behalf of such petitioner, the deputy directors or referees of the Division of Workmen’s Compensation are authorized to incorporate in any award, order or approval of settlement, an order requiring the employer or his insurance carrier to reimburse such insurance company, corporation, person or organization in the amount of such medical, surgical or hospital services so paid on behalf of such petitioner.

The Appellate Division distinguished this sort of petition for reimbursement from a claim for contribution by one employer against the other, saying contribution claims like this are prohibited under the case of Conway v. Mr. Softee, Inc., 51 N.J. 254, 258 (1968).  The difference in this case was, according to the Appellate Division, that “the Diocese did not file a claim on its own behalf, but rather, as permitted by the statute, filed the claim on behalf of Martinez.” The Court said, “The claim in Conway was for contribution from the other employer, where the present claim is on behalf of the employee for reimbursement.”  In Conway, one employer tried to file a claim against another employer, and the Court said that cannot be done in the Division of Workers’ Compensation.

The next issue that the Appellate Division decided concerned employment by IHM.   It recited the two tests for employment, namely the “control” test, and the “relative nature of the work” test, and under both tests the Court found Martinez was an employee of IHM.   The decision does not make clear whether IHM argued that the Diocese was a “joint employer.”  Presumably that argument was advanced, but one cannot tell from the Appellate Division decision.  Control was established by the Mother Superior providing direction to Martinez.  The relative nature of the work test was met because Martinez cooked daily meals for the sisters in the convent and worked exclusively for the sisters in the convent.  She had no written agreement with the Diocese.

IHM also challenged the counsel fee award of $50,000.  For one thing, IHM argued that $50,000 constituted more than 20% of the award.  The Court noted that the Diocese had paid $172,182 as of January 13, 2015, and St. Barnabas had a claim for $399,017.  The Court said, that an award of $50,000 was far less than twenty percent of the combined amount paid by the Diocese and the amount owed to St. Barnabas.

Interestingly, the Appellate Division reversed an award of permanency to Martinez because Martinez never filed a claim petition and the Judge never explained the basis for the award.

This case is one of a kind, and there are really no other non-PIP cases like it that have been reported.  It is somewhat astonishing because the Diocese volunteered initially to pay medical bills without any court order or claim petition having been filed.  Yet the Diocese managed to obtain full reimbursement after paying $172,182 on a charitable basis by resort to filing a claim petition on behalf of the petitioner pursuant to N.J.S.A.34:15-15.1.   The language that the court focused on would suggest that employers can utilize this procedure rather easily: the standard set forth in the statute is  whether the petitioner would have been entitled to reimbursement had petitioner made the payments herself.  

Until this case, this particular statute has been used almost exclusively by PIP carriers to obtain reimbursement for medical bills and temporary disability benefits that PIP is required to pay under contract with rights over against the workers’ compensation carrier for injuries arising out of and in the course of employment. Based on this case, this statute now has a much wider potential use than just PIP reimbursement actions.

-----------------

John H. Geaney, Esq., is an Executive Committee Member and a Shareholder in Capehart Scatchard's Workers’ Compensation Group.  Mr. Geaney concentrates his practice in the representation of employers, self-insured companies, third-party administrators, and insurance carriers in workers’ compensation, the Americans with Disabilities Act and Family and Medical Leave Act. Should you have any questions or would like more information, please contact Mr. Geaney at 856.914.2063 or by e‑mail at jgeaney@capehart.com.

REEFER MADNESS CLOUDS PENNSYLVANIA

By Kevin L. Connors, Esquire

Released in 1936, the movie classic Reefer Madness captured the social hysteria of drug addiction amid a cloud of marijuana smoke.

Originally titled as Tell Your Children, with alternate titles beingThe Burning Question, Dope Addict, Doped Youth, the movie was an American drama highlighting melodramatic events after High School students were lured by drug pushers to try smoking marijuana, resulting in their slow descent into madness due to marijuana addiction, in the course of which the students were involved in hit and run accidents, suicide, rape, hallucinations, and homicide. 

80 years later, enlightened by time, science, and relativity, although marijuana remains a controlled and prohibited substance under Federal law, there is a growing consensus in the medical community that marijuana can serve a utilitarian purpose in the treatment of serious medical conditions, with 25 states, including Pennsylvania, having legalized medical marijuana.

On April 17, 2016, Governor Tom Wolf, signed the Pennsylvania Medical Marijuana Act (commonly referred to as “Senate Bill 3”, to be referenced herein as the “MMA”), into law, effectively making Pennsylvania the 24th state to legalize medical marijuana.

This enactment will effectuate sweeping changes in Pennsylvania, legalizing the use of medical marijuana, subject to its dispensing and utilization being regulated under the MMA, while marijuana still remains illegal under Federal law, specifically under the Controlled Substance Act (“CSA”), which went into effect in 1970, and classified cannabis as a Scheduled I substance.

Although marijuana is a controlled and prohibited substance under Federal law, the Federal Government is not forcing states that have legalized medical marijuana to criminalize its use, as there are no known cases of Federal prosecution involving the use of medical marijuana in the 25 states that have legalized its use.

In effect, cultivating, distributing, and/or possessing cannabis, even for medical treatment purposes, remains a Federal crime, complicating the issue of who will have to pay for medical marijuana treatment in Pennsylvania, once the MMA is fully implemented in Pennsylvania.

For this very reason, Section 2012 of the MMA, specifically states that “nothing in this Act shall be construed to require an insurer or a health plan, whether paid for by Commonwealth funds or private funds, to provide coverage for medical marijuana.”

So, where do you go to get into line to get your prescription filled?

First, it will take months, if not years, for the MMA to be fully implemented, before prescriptions are being dispensed.

Secondly, the MMA specifically requires that a patient must be diagnosed with a “serious medical condition” to qualify for medical marijuana.  These conditions are listed below:

·                     Cancer;

·                     HIV/Aids;

·                     Amyotrophic Lateral Sclerosis (ALS);

·                     Parkinson’s Disease;

·                     Multiple Sclerosis;

·                     Damage to the nervous tissue of the spinal cord with objective neurological indication of intractable spasticity;

·                     Epilepsy;

·                     Inflammatory Bowel Disease (IBS);

·                     Neuropathy;

·                     Huntington’s Disease;

·                     Crohn’s Disease;

·                     Post-traumatic Stress Disorder (PTSD);

·                     Intractable Seizures;

·                     Glaucoma;

·                     Sickle Cell Anemia;

·                     Severe Chronic or Intractable Pain of Neuropathic Origin or Severe or Intractable Pain in which conventional therapeutic intervention and opiate therapy is contraindicated or ineffective; and,

·                     Autism.

Conditions not specifically listed above are considered to be excluded, as the Legislature intended to limit the conditions considered to be serious enough to warrant the use of medical marijuana as a treatment therapy.

Reviewing the list of “serious medical conditions” identified under the MMA, there are several that could potentially impact on workers’ compensation claims, involving work-related injuries arising within the course and scope of employment, likely being limited to the potential contraction of HIV/Aids, sometimes occurring in the medical profession, spinal cord injuries with intractable spasticity, neuropathies, post-traumatic stress disorder, and severe chronic or intractable pain of neuropathic origin.

If diagnosed with one of the enumerated “serious medical conditions”, the next question is how would a patient go about gaining access to medical marijuana?

The MMA provides several provisions that impact on accessibility, to include the patient being required to secure a medical marijuana card that can only be issued to a patient with a “serious medical condition”.  This will require the patient to be under the continuing care of a physician registered with the Pennsylvania Department of Health. 

The physician will be required to provide a signed certification to the patient, stating that the patient has a “serious medical condition”, with that certification then permitting the patient to apply to the Department of Health for an identification card.

So identified, the patient can then purchase medical marijuana at an authorized dispensary.

So now that the patient has been diagnosed with a “serious medical condition” and has secured the requisite identification card, and has been prescribed medical marijuana by a properly-certified physician, where will the prescription be filled for the patient? 

To regulate dispensement issues, the Pennsylvania Department of Health will require physicians, whether medical or osteopathic doctors, to apply to the Department of Health to become registered as “practitioners”, in the course of which the physicians must complete formal training before becoming a registered practitioner.

Being registered as a “practitioner” will allow physicians to certify patients to use medical marijuana.

Similar registration and training procedures will be implemented for pharmacies to dispense medical marijuana.

How will the enactment of the MMA impact upon workers’ compensation claims and litigation in Pennsylvania?

Well, the MMA contains several provisions, specifically impacting upon employment relationships, to include:

·                     An Employer cannot discharge, threaten, refuse to hire, or, otherwise, discriminate or retaliate against an Employee, solely on the basis of the Employee being certified to use medical marijuana;

·                     There is no requirement that an Employer must accommodate the use of medical marijuana on the premises or property of the Employer;

·                     There is also nothing in the MMA that would limit an Employer’s right to discipline an Employee for being “under the influence of medical marijuana” when working, nor does the MMA prohibit the Employer from disciplining an Employee whose performance falls below the standard of care normally accepted for that position “while under the influence of medical marijuana…”;

·                     There is also nothing in the MMA requiring the Employer to commit any act that would put the Employer in violation of Federal law;

·                     The MMA also allows an Employer to prohibit an Employee from performing certain tasks, deemed to be life-threatening to the Employee or other Employees, if the Employee has a blood content of more than 10 nanograms of active THC per milliliter of blood;

·                     The MMA also allows an Employer to prohibit an Employee who is prescribed medical marijuana from performing any duty or task that is a safety risk, regardless of the financial harm to the Patient/Employee; and,

·                     The MMA also does not allow an Employee to be under the influence of medical marijuana, or be impaired, during the work day, or while performing his or her duties in the workplace.

Signed into law 6 months ago, the Pennsylvania Department of Health estimates that the process of actually implementing the state’s Medical Marijuana Program will take between 18 to 24 months, before access is actually available.

An unresolved question for Employers, Workers’ Compensation Insurers, and Administrators, will be whether to accept or decline liability for paying for medical marijuana prescriptions. 

Consider that two of the “serious medical conditions” listed in the MMA, to include neuropathy and severe chronic pain, are currently regularly treated with excessive opiates, while the alternative of using medical marijuana as a substitute for pain medications might actually result in significant savings for Employers/Insurers.

To date, no specifics have been provided regarding the billing and pricing for medical marijuana treatments, nor is there any requirement under the MMA for Employers and Insurers to be responsible for the payment of medical marijuana prescriptions.

The opening scrawl in Reefer Madness was “the motion picture you are about to witness may startle you.  It would not have been possible, otherwise, to sufficiently emphasize the frightful toll the new drug menace, which is destroying the youth of America in alarmingly increasing numbers.  Marijuana is that drug—a violent narcotic—an unspeakable scourge—the Real Public Enemy Number One!”

Has the world gone mad?

The Takeaway

So, the truth is, beyond the “trust us, we just get it”, that we are not mad, and that we are about to embark on a regulatory framework that will have significant impact on not simply the administration of workers’ compensation claims, but upon the actual workplace, in terms of issues related to accommodation, discrimination, and performance.

Enactment of the MMA will almost necessarily create procedural and administrative frustrations for Employers and Insurers, as it could well take years to streamline the implementation of the MMA, and the regulations that will need to be enacted to manage its impact on treatment and dispensing.

ConnorsO’Dell LLP

Trust us, we just get it!  It is trust well spent!

We defend Employers, Self-Insureds, Insurance Carriers, and Third Party Administrators in Workers’ Compensation matters throughout  Pennsylvania.  We have over 100 years of cumulative experience defending our clients against compensation-related liabilities, with no attorney in our firm having less than ten (10) years of specialized experience, empowering our Workers’ Compensation practice group attorneys to be more than mere claim denials, enabling us to create the factual and legal leverage to expeditiously resolve claims, in the course of limiting/reducing/extinguishing our clients’ liabilities under the Pennsylvania Workers’ Compensation Act.

Every member of our Workers’ Compensation practice group is AV rated.  Our partnership with the NWCDN magnifies the lens for which our professional expertise imperiously demands that we always be dynamic and exacting advocates for our clients, navigating the frustrating and form-intensive minefield pervasive throughout Pennsylvania Workers’ Compensation practice and procedure.

On September 9, 2016, the Alabama Court of Appeals released its decision in Kennamer Bros., Inc. v. Stewart, in which it affirmed the Circuit Court of Marshall County determination that Stewart’s shoulder injury was compensable. In that case, the truck driver-employee was involved in a rollover accident and sustained multiple injuries. However, the primary issue was whether Stewart’s right shoulder injury was compensable. Stewart had been airlifted to a hospital after the accident, where he was treated for head injuries. He underwent several procedures to remove shards of glass from his scalp and was prescribed antibiotic and pain medications. After he came off of pain medications for his head injury, he then noticed pain his right shoulder and was later diagnosed with a rotator cuff tear. However, Stewart did not report his alleged right shoulder pain to his treating physician until nearly five months after the alleged accident. The physician testified that while it would be very unusual for a person with a rotator cuff tear to not experience immediate pain, it was possible that pain from more severely injured parts of his body and/or pain medications administered for others injuries could mask the symptoms of a rotator cuff tear. The physician further testified that Stewart’s symptoms were consistent with his self-reported medical history and were consistent with a rotator cuff injury. Kennamer Brothers failed to present evidence of any subsequent accident or injury that would explain Stewart’s symptoms.

Stewart was ultimately released to return to work in February 2013, but was unable to drive for Kennamer Brothers because the employer could not secure insurance coverage for him due to the fact that he had been involved in several automobile crashes. In January 2014, Stewart went to work for a different employer.

Based on the evidence, the trial court found that Stewart’s right shoulder injury was compensable, and awarded TTD benefits through January 2014. Kennamer Brothers appealed. The Alabama Court of Appeals noted that the employee’s burden of proof is to produce substantial evidence tending to show that the alleged accident occurred and that it caused or was a contributing cause of the injury. The Court of Appeals held that Stewart met this burden of proof, and noted that symptoms that first appear a few hours, days, or even months after a traumatic event may nonetheless properly be deemed causally related if no intervening event has occurred and no alternative medical explanation is provided for the presence of symptoms.

The Court of Appeals acknowledged that TTD benefits may not be owed if the injured employee is able to work and earn his pre-injury wages, but he is prevented from working for reasons unrelated to his workplace injury. However, the Court of Appeals found that the trial court had a sufficient basis on which to determine that the reason for the termination of Stewart’s employment (i.e. his uninsurability) was related to the injury he sustained. The Court noted that had Stewart not been involved in the crash, he probably would not have been an impossibly high insurance risk. Based on this, the Court of Appeals stated it could not conclude that Stewart failed to show a causal link between his injury and his diminished earning capacity, and affirmed the portion of the order awarding TTD benefits through January 2014.

About the Author

This article was written by Charley M. Drummond, Esq. of Fish Nelson & Holden, LLC. Fish Nelson & Holden is a law firm located in Birmingham, Alabama dedicated to representing employers, self-insured employers, and insurance carriers in workers’ compensation cases and related liability matters. Drummond and his firm are members of The National Workers’ Compensation Defense Network (NWCDN). The NWCDN is a national and Canadian network of reputable law firms organized to provide employers and insurers access to the highest quality representation in workers’ compensation and related employer liability fields. If you have questions about this article or Alabama workers’ compensation issues in general, please feel free to contact the author at cdrummond@fishnelson.com or (205) 332-3414.

Three cases were heard together in the New Jersey Appellate Division regarding the right of employers to obtain reimbursement under N.J.S.A. 34:15-40 in situations involving car accidents where medical treatment was potentially recoverable under PIP.  The cases are Lambert v. Travelers Indemnity Company of America, Reed v. Qual-Lynx and Township of Marlboro, and Agar v. Qual-Lynx and Township of Hazlet, App. Div. A-1073-14T3, A-3040-14T1, A-3071-14T1 (App. Div. August 24, 2016).

The first case involved Jennifer Lambert who worked for the Howell Township Board of Education as a school bus aide.  She was injured in a work-related car accident.  Travelers Insurance Company paid $94,705.22 for medical expenses and $54,695.87 for indemnity benefits.  Lambert sued the other driver and recovered $300,000.  Her lawyer refused to reimburse Travelers anything for medical expenses but agreed to reimburse two thirds of indemnity benefits.

The second case involved Paul Reed, who  worked for the Township of Marlboro as a police officer.  Reed was redirecting traffic during work when he was struck by a vehicle.  Marlboro belonged to the Monmouth Municipal Joint Insurance Fund and its third party administrator, Qual-Lynx, paid $60,430.48 for medical expenses and $44,578.29 for indemnity benefits.  Reed recovered $100,000 in his third party law suit.  Counsel for Reed offered to reimburse the JIF two thirds of indemnity benefits but refused to reimburse any medical expenses.

The third case involved William Agar, who worked as a police officer for the Township of Hazlet.  Officer Agar was injured on June 26, 2011 while sitting in his police car, which was struck by another vehicle.  The Township of Hazlet also belonged to the Monmouth County Municipal Joint Insurance Fund and the JIF paid $4,331.02 for medical expenses and $15,693 for indemnity benefits.  Agar recovered $60,000 in his third party law suit and refused to reimburse any of the medical expenses.

All three cases went before the same Judge of the Superior Court, who ruled based on the unreported Dever decision that the plaintiff injured workers did not have to reimburse the portion of the workers’ compensation lien corresponding to medical expenses.  The Superior Court Judge concluded that since a no-fault insured cannot make a recovery from a third party tortfeasor for medical expenses, the workers’  compensation carrier could not seek reimbursement under N.J.S.A. 34:15-40.

The Appellate Division reversed in all three cases and said that the Automobile Insurance Cost Reduction Act  (AICRA) did not negate the right of employers to subrogation of medical expenses.  The Court explained that the way N.J.S.A. 39:6A-6 of AICRA works is that workers’ compensation becomes the primary payor in a work-related car accident.  The PIP carrier must pay initially by contract but ultimately the workers’ compensation carrier must reimburse the PIP carrier.  “N.J.S.A. 39:6A-6 ‘relieves the PIP carrier from the obligation of making payments for expenses incurred by the insured [, including medical expenses] which are covered by workers’ compensation benefits.”   The Court also noted that workers’ compensation benefits “shall be deducted from the benefits collectible under [PIP].”

The Court added, “The collateral source rule does not make workers’ compensation part of the PIP no-fault system; rather it shifts the burden of providing insurance from the automobile insurance system to the workers’ compensation system.”  The Court concluded, “. . . nothing in that statutory language suggests that the Legislature intended to treat a workers’ compensation insurer as if it were an automobile insurer.”   The Court added, “Nor is there any suggestion that the Legislature intended to treat workers’ compensation insurers as if they were PIP insurers.  It is fair to assume that had the Legislature intended to effectuate such a major change, it would have used express language in the statute and discussed that incorporation in AICRA’s legislative history.”

These cases make clear that the unreported decision in Dever is bad law insofar as its ruling on subrogation.  These three decisions have been reported and should end the controversy over recent years about whether a work-related plaintiff injured in a car accident must reimburse the employer for medical expenses when a third party recovery is made.

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John H. Geaney, Esq., is an Executive Committee Member and a Shareholder in Capehart Scatchard's Workers’ Compensation Group.  Mr. Geaney concentrates his practice in the representation of employers, self-insured companies, third-party administrators, and insurance carriers in workers’ compensation, the Americans with Disabilities Act and Family and Medical Leave Act. Should you have any questions or would like more information, please contact Mr. Geaney at 856.914.2063 or by e‑mail at jgeaney@capehart.com.