State News

          Adesina Mercer worked for the Arc of Prince George County from 2004 to 2011.  Her job included applying for and processing initial applications for benefits for Food Stamps and Social Security. 

            In May 2007, The Arc put Mercer on conditional employment status due to poor work performance.  She was returned to regular status the next month. However, while she was on medical leave in 2009, her co-workers discovered that many of the Arc’s food-stamp-eligible clients were no longer receiving benefits.  When Mercer returned to work, this issue was addressed with her and she was instructed to take steps to renew those clients’ benefits.

            In October 2010, Mercer received a performance review which was largely average with only one category being above average.  The next month, The Arc once again discovered that some food-stamp-eligible clients were not receiving benefits.  Mercer was provided with a list of clients and told to pursue reinstatement of benefits.

Mercer countered that these kinds of lapses in benefits were fairly commonplace.  She felt that she should not be reprimanded for these lapses.

            In January 2011, Mercer was involved in a car accident with injuries that kept her out of work for about three weeks.  She requested and obtained FMLA leave.   While Mercer was on leave, other workers performed her job and discovered again that there were many more eligible clients not receiving benefits due to Mercer’s failure to submit renewal or redetermination requests.

            Mercer returned to work on February 22, 2011 and was placed on administrative leave due to poor job performance.  At the end of the five-day administrative leave period, Mercer sought additional FMLA leave until March 14, 2011.

            The investigation of Mercer continued, leading The Arc to conclude Mercer grossly deviated from her job’s requirements and failed to obtain Food Stamp benefits for 99 of 160 eligible clients.  For this reason her employment was terminated during her FMLA leave.  

            Mercer sued and argued that her termination constituted unlawful interference with the exercise of her FMLA rights.  The Arc moved to dismiss the case, and the district court ruled for the Arc.  Mercer appealed to the Fourth Circuit Court of Appeals.  The Court said that “being on FMLA leave does not provide an employee any greater rights than he or she would have had without taking leave, and an employee’s right to reinstatement is not absolute.”

An employer has discretion to discipline or terminate the employment of an at-will employee for poor performance regardless of whether the employer’s reason for terminating the employment was discovered while the employee is taking FMLA leave.

Mercer argued that her employer improperly used her leave request to generate a reason for termination.  The Court said the fact that the leave permitted The Arc to discover the problems with Mercer’s job performance could not logically be a bar to the employer’s ability to fire a deficient employee. 

            The case is helpful because it demonstrates an important rule, namely that an employee on FMLA leave is not entitled to greater rights than the employee would have had without taking leave.  The case can be found atMercer v. The Arc of Prince George County, Inc., 2013 U.S. App. LEXIS 14060 (4^th Cir. 2013).

In a move akin to the zombie apocalypse, a West Virginia legislator attempts to resurrect dead provisions in legislation filed on February 10, 2014.   State Senator Jack Yost, a Democrat from Brooke County, introduced eight bills that eviscerate the legislative progress made in West Virginia’s workers’ compensation system since 2003. 

Highlights of the legislation include:

·        Re-establishment of rule of liberality requiring all “reasonable inferences” be drawn to a claimant’s benefit due to the remedial nature of workers’ compensation legislation

·        Statutorily mandated deference to treating physician and elimination of the current preponderance of the evidence standard of review

·        Requiring approval of any diagnostic testing causally related to the injury and any new diagnosis revealed by the diagnostic testing is “automatically granted” if deemed by the treating physician to be related to the compensable injury

·        Eliminating the Rule 20 medical management rule where the guidelines differ from the opinion of the treating physician

·        Treble damages if treatment denial is reversed

·        Insurance Commissioner makes all initial compensability rulings but no corresponding change to allow for employer protests to the compensability rulings

·        Lowers PTD threshold to 40% from 50%

·        Vocational assessments consider 30 miles the maximum for viable employment from the current rule of 75 miles

·        CTS and other disease impairments based on symptoms rather than measureable impairment may be counted in the PTD threshold

·        No offsets on TTD payments for wage replacement plans

·        PTD benefits payable until death (currently age 70 cutoff)

·        No PTD re-assessments after age 60

·        Occupational pneumoconiosis coverage extended to out-of-state employment performed at the direction and under the care of the employer rather than current rule where only in-state exposures are considered in the compensability of such claims

·        Extension of the statutory presumption in favor of compensability of certain diseases suffered by professional firefighters to volunteer firefighters; also expanding the diseases presumed to be compensable

·        Reinstatement of the 5% PPD award for any claimant with a diagnosis of occupational pneumoconiosis without evidence of pulmonary impairment

We are investigating the impetus behind these bills and monitoring the committees in which they are assigned.  Senator Yost is the chair of the Labor Committee and vice chair of the Military Committee.  He also sits on the Energy, Industry and Mining Committee, the Finance Committee, and Health and Human Resources Committee, among others.   In our opinion, the proposed legislation is an attempt to undermine the workers’ compensation reforms that have been enacted since at least 2003 when we had our first significant bout of reforms.   For any questions, comments, or concerns, please feel free to contact us.

Karin Weingart and Dill Battle, February 12, 2014

Spilman Thomas & Battle, PLLC

kweingart@spilmanlaw.com

dbattle@spilmanlaw.com

The City of Gibraltar employed 41 employees excluding its “volunteer” firefighters.  When it fired one of the firefighters, Paul Mendel, he sued under the FMLA. The City countered that it was not covered under the FMLA because it had less than 50 employees. There were 25-30 “volunteer firefighters” whom the City contended were not truly employees and should not be counted toward the 50 employee threshold.

            The issue in the case came down to the definition of “employee” for purposes of the FMLA.  The firefighters did not receive health, sick, or vacation benefits; nor did they receive social security benefits.  They did training on their own time.  On the other hand, when the volunteer firefighters responded to any emergency call or maintained equipment, there were paid $15 per hour. 

1.      The Sixth Circuit Court of Appeals studied the Fair Labor Standards Act to obtain the definition of “employee” since the FMLA and FLSA use the same standard.  The Court observed that the United States Supreme Court previously adopted an “economic reality” test to determine whether someone was an employee for purposes of the FLSA. While the district court found that the City had no control over the firefighters, the Court of Appeals said that lack of control was not sufficient to account for the result in this case.  “Each time a firefighter responds to a call, he knows he will receive compensation at a particular hourly rate -- which happens to be substantially similar to the hourly rates paid to full-time employed firefighters in some of the neighboring areas.”

            The Court noted that the FLSA excludes those who receive only a nominal fee from the definition of employee, but the Court did not consider a payment of $15 per hour to be a nominal fee. Therefore the Court held in favor of employment status for the so-called City of Gibraltar volunteer firefighters.  It found that the FMLA applied to the City and to Mr. Mendel’s law suit:

Despite the fact that the Gibraltar firefighters are referred to as ‘volunteers,’ the inescapable fact nevertheless remains that they ‘work in contemplation of compensation.’  Thus, the Gibraltar firefighters are ‘employees’ and not ‘volunteers’ within the meaning of the FLSA.

There was an interesting dissent in this case in which it was argued that the City does not require a firefighter to respond to any fires and did not supervise such firefighters on the scene.  Someone could go for years without responding to a single fire.  The dissent pointed out that the volunteers really were not paid $15 per hour considering the fact that they had to complete 152 hours of training, pass an exam and then complete an additional 73 hours of training each year -- all without pay.

This case can be found at Mendel v. City of Gibraltar, 727 F.3d 565 (6^th Cir. 2013).

The Office of Injured Employee Counsel is holding its annual stakeholder meeting in a few days.  A key part of the agenda is OIEC’s legislative agenda for the 2015 Legislative Session. Not surprisingly, OIEC’s wish list would create considerable expense to Carriers. Here are the changes OIEC wants –

Expand LIBs – OIEC wants a statutory amendment clarifying that a Claimant qualifies for LIBs if he or she loses use of a body part as a result of a compensable injury even if the Claimant’s compensable injury was not to that body part. 

Increase TIBs Amount – OIEC wants increases in TIBs calculations: (1) increase in the benchmark earning rate from $8.50 an hour to $12.40 an hour, (2) increase TIBs from 70 percent to 75 percent of the AWW for a Claimant that earn $12.40 an hour or more, and (3) increase TIBs from 75 percent to 80 percent of AWW for a Claimant that earn less than $12.40 an hour.

Limit Carrier Ability to Dispute Extent of Injury – OIEC wants a deadline to dispute extent of injury placed in the statute. It wants a Carrier to have to dispute extent of injury within 60 days of receiving written notice that the injury extends to include a certain body part or that defense would be waived. The intention of this legislative change is to codify a 60 day waiver period in extent of injury cases, contrary to the Supreme Court’s decision inState Office of Risk Mgmt. v. Lawton.

Same Venue for Judicial Review of Medical Fee Dispute Decisions and BenefitDecisions

– OIEC wants the venue to be the same for judicial review of a medical fee dispute decision as it is for a benefit decision. That is, judicial review of both types of proceedings should be filed in county where the employee lived at the time of injury or death.

Provide Attorney’s Fees to Claimants for Medical Necessity Dispute Cases–

OIEC wants Carriers be liable for Claimants’ attorneys’ fees incurred when a Claimant prevails in a judicial review of a medical necessity dispute, if the injured employee prevailed administratively at the Appeals Panel.

Carriers Should Pay for Claimant’s Expert Evidence of Causation– OIEC wants to require Carriers to pay for treating doctors to provide opinions on causation through reports or testimony at the CCH, or if the treating doctor is not available, to pay adesignated doctor to provide such report or testimony. Alternatively, OIEC wants a legislative grant to give OIEC money to hire experts.

You might have to disgorge four times the amount of benefits withheld from the injured worker.  An alternative to statutory workers’ compensation is a plan under the Employee Retirement Income Security Act – an ERISA plan provided to an employer by a plan insurer. Like statutory comp, an ERISA plan may provide for disability benefits for an on the job injury. Unlike statutory comp, however, an insurer who denies disability benefits may be ordered to provide withheld disability benefitsand to disgorge any “profits” on the withheld benefits under an “appropriate equitable relief” provision of the ERISA statute. The U.S. Court of Appeals for the Sixth Circuit recently upheld an award of withheld benefits in addition to disgorgement of four times the amount of withheld benefits representing the insurer’s “profits” on the withheld benefits. The trial court found the insurer breached its fiduciary duty simply by denying benefits. Considering the insurer’s potential exposure for disgorgement of profits as a claims handling expense, statutory comp may be a less risky option Texas.

Rochow v. Life Ins. Co. of N. Am., No. 12-2075, 2013 U.S. App. LEXIS 24271 (6th Cir. Dec. 6, 2013).

The Appeals Panel recently reversed a Hearing Officer’s determination that the first certification of MMI/IR provided in 2010 did not become final because the Hearing Officer determined in 2013 that Claimant’s injury extended to include additional, unrated conditions. The preamble to Rule 130.12 warns parties not to delay in timely disputing the first certification of MMI/IR pending resolution of an extent of injury dispute, because such resolution may occur after the 90-day period expires. In this decision, the Appeals Panel noted “there is no provision in [the Act or Rules] that provides that the exclusion of a condition in an assignment of IR constitutes an exception to finality.” The Appeals Panel held that subsequent resolution of the extent of injury dispute is not, in and of itself, an exception to finality. The Appeals Panel did not foreclose the possibility that an exception to finality may exist where a Claimant does not receive adequate treatment for the entire injury prior to the first certification of MMI because of the extent of injury dispute.

Appeal No. 132594-s, dated Jan. 3, 2014.

The Appeals Panel considered whether a designated doctor properly assigned IR based on range of motion (ROM) measurements of a Claimant’s right knee. In his report, the DD recorded 100 degrees of flexion and 10 degrees of flexion contracture of the knee. According to Table 41 of the Guides, these measurements correspond to 4% whole person impairment for flexion and 8% whole person impairment for extension/flexion contracture. The DD did not add the two whole person impairments together (4% plus 8%), but, rather, the DD assigned a whole person IR of 8%. The issue on appeal was whether the AMA Guides required the DD to combine the whole person IR of each angle of the knee joint. The Appeals Panel concluded the AMA Guides do not require the ROM deficits to be combined to increase the impairment for a single joint. Rather, it was within the DD’s discretion as a matter of medical judgment to not combine the different angles of loss of ROM of Claimant’s knee. The DD’s 8% IR was in accordance with the Guides.

Appeal No. 132734, dated Jan. 9, 2014.

Point-of-service drug testing is becoming more common. If a provider decides to do urine drug tests on a patient, the ODG evaluates the need for testing based on the risk of adverse events or of drug misuse by the Claimant. Before paying, the Carrier should look for documentation of a risk assessment, as well as evidence of the reasoning behind the frequency of the testing. For Claimants with a low risk of adverse events or drug misuse, the ODG recommends random testing no more than twice a year. For Claimants at intermediate risk, the ODG recommends random testing 3 to 4 times a year. Claimants with high risk may be tested at every other, or even at every, office visit.

We have seen a few recent cases where Carriers are being charged for designated doctor appointments missed or rescheduled by Claimants. The DWC medical fee guidelines do not permit a designated doctor to bill a Carrier for a rescheduled or missed appointment. DWC Rule 134.204.  Bills that invoice Carriers for a fee for missed or rescheduled appointments should be denied.

The DWC recently circulated a memo reminding system participants that Rule 127.1 requires parties submitting Requests for Designated Doctor Exams (DWC 32s) to send a copy of the DWC 32 to the opposing party at the same time the document is filed with the DWC. The DWC reports that some system participants are not exchanging DWC 32s. As part of a new “customer service initiative” to address the issue, the DWC will begin automatically sending to the injured employee a copy of any DWC 32 filed by a Carrierprior to sending the order for the designated doctor exam. Curiously,

Claimants’ frequent failures to exchange DWC 32s with Carriers is not mentioned.