State News

On February 27, 2015, the Alabama Court of Appeals released its decision in Ex parte Fairhope Health & Rehab, LLC. The facts of the case were as follows: The plaintiff, Lula Durgin worked as a nursing home activities director for Fairhope Health & Rehab. One day, while preparing to take a group of nursing home residents to the local Wal-Mart, she climbed into the driver’s seat of her employer’s van. Durgin alleged that in February 2012, she felt pain in her right knee as she went to sit down in the seat of the van. Durgin was sent to a local orthopaedist, who diagnosed her with a torn meniscus and pre-existing arthritis. The orthopaedist performed surgery to repair the torn meniscus, and released Durgin to return to work without restrictions. Durgin returned to work, but several months after surgery she continued to have pain in her right knee. Durgin’s orthopedist related the continued pain to pre-existing arthritis. Durgin also contended that her knee caused her to fall several times, and on one occasion, she had sustained a back injury due to a fall at home. Another physician determined that Durgin needed to undergo a right knee total replacement surgery. Durgin contended that Fairhope Health & Rehab was responsible for the total knee replacement surgery, and that her alleged back injury was also compensable as the direct and natural result of her on-the-job-knee injury. Fairhope Health & Rehab asserted that Durgin’s alleged injuries did not occur in or arise out of her employment, and that Durgin’s need for a right knee replacement was not related to the alleged accident. Fairhope Health & Rehab also denied that Durgin had any compensable back injury and further asserted that her alleged back problems were the result of a prior accident that had occurred several years before she was hired.

Durgin filed suit, and the parties took the deposition of the orthopedist who had performed the meniscus repair. During his deposition, Durgin’s orthopedist reviewed medical records and MRIs taken of both Durgin’s knees in 2007, five years prior to the February 2012 incident. Those MRIs showed that the menisci in both of Durgin’s knees were shredded and severely torn. At that time, her doctor had recommended that she undergo knee replacement procedures of both knees. While Durgin elected to undergo a total knee replacement in her left knee, she had never had surgery to repair the torn meniscus or to replace the right knee joint. Despite this, she had been able to perform all of the regular duties of her job at Fairhope Health & Rehab prior to her alleged accident. Durgin’s orthopedist stated that while the alleged incident in February 2012 may have exacerbated her already torn meniscus, the surgery he had performed restored her knee to a condition that was even better than it had been prior to the February 2012 incident. The orthopedist also testified that while Durgin continued to complain of pain in her knee, it was solely the result of the pre-existing arthritis in her "terrible looking knee", and not the February 2012 incident. Following the orthopedist’s deposition, the case went to trial on three issues: (1) whether Durgin’s alleged meniscus tear occurred in and arose out of her employment; (2) whether Durgin’s need for a knee replacement surgery was related to the February 2012 incident; and (3) whether Durgin’s alleged back injury was compensable.

Durgin testified on her own behalf at trial, and also called one of her co-workers as a witness to testify that she had been able to perform her regular job duties prior to the February 2012 incident. The deposition and medical records of Durgin’s treating physician were entered into evidence, as were medical records from the doctor who had performed the left knee replacement surgery in 2008. Despite the fact that no other evidence was presented at trial, the trial court found that the February 2012 incident exacerbated or aggravated Durgin’s pre-existing meniscus tear, and that Fairhope Health & Rehab was responsible for Durgin’s right knee replacement procedure. The trial court found that Durgin’s alleged back injury was not compensable. Fairhope Health & Rehab appealed the findings that the torn meniscus and need for the knee replacement were related to Durgin’s February 2012 incident.

The Alabama Court of Appeals held that since the trial court did not determine the specific amount of temporary total or permanent partial disability benefits to which Durgin was entitled, it was not a final appealable Order. However, the Court of Appeals evaluated the employer’s appeal as a Petition for Writ of Mandamus instead. The Court of Appeals held that the Trial Court’s finding that Durgin sustained an accident occurring in and arising out of her employment that aggravated her already torn meniscus was supported by substantial evidence. However, since the only evidence presented on the issue of medical causation (the treating physician’s deposition testimony and medical records) established that Durgin’s need for a knee replacement was not related to her alleged accident, the Court of Appeals held that Durgin had failed to meet her burden of proof. As a result, it issued a Writ of Mandamus to the Trial Court, directing it to set aside the portion of the Order requiring Fairhope Health & Rehab to pay for the prescribed right knee replacement surgery.

Two Judges dissented, stating that the Trial Court’s Order was final for purposes of Appeal, since all of the issues submitted to the trial court had been decided. Despite their dissent on the procedural aspects of the case, those two judges concurred with the end result.

MY TWO CENTS:

If allowed to stand, the trial court’s ruling would have required the employer to provide medical treatment that, according to Durgin’s treating physicians, was unrelated to the alleged accident. In his dissent, Judge Moore stated, "the trial court could have reached its conclusion only by impermissibly deciding matters lying exclusively within the peculiar knowledge of medical experts." This was the same position taken by Fairhope Health & Rehab. While Alabama law has long held that expert medical testimony is not necessary to establish medical causation in a workers’ compensation case, there was expert medical testimony in this case, and it firmly supported Fairhope Health & Rehab’s position.

Also important to note is that the Court of Appeals cited the case of Alamo v. PCH Hotels & Resorts, in finding that Fairhope Health & Rehab was not responsible for Durgin’s knee replacement surgery because the alleged accident only temporarily aggravated her underlying arthritis. In doing so, I believe the Court of Appeals differentiated this situation from the one presented inMadison Academy v. Hanvey, reiterating that the employer is not liable for any continuing symptoms that result solely from a pre-existing condition.

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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.

BEING SPECIFIC ABOUT SPECIFIC LOSSES

By Jeffrey D. Snyder, Esquire

In Jacqueline Fields v. WCAB (City of Philadelphia), decided by the Pennsylvania Commonwealth Court on November 14, 2014, the Court addressed the issue of whether benefits payable for an injured employee sustaining multiple specific losses, arising from the same injury, should be paid consecutively, as opposed to being paid concurrently under the Pennsylvania Workers’ Compensation Act.

In Fields, the Pennsylvania Commonwealth Court ruled that the benefits should be paid consecutively, regardless of whether that meant that the benefits due and owing might not be completely paid within the injured employee’s life expectancy.

This case arose as a result of the injured employee sustaining injuries to her left shoulder, arm, wrist, and hand, while restraining an inmate, in the course of working as a prison guard for the City of Philadelphia in January of 2013.

In December of 2013, she was awarded workers’ compensation benefits, in the form of temporary total disability benefits, by the Workers’ Compensation Judge.

Three years later, a different Workers’ Compensation Judge granted the injured employee’s Review Petition, adding additional descriptions of injury to the injury nexus for the injured employee’s 2003 injury, including adding a partial tear of the left rotator cuff, a left brachial plexus traction injury, and reflex sympathetic dystrophy of the injured employee’s left upper extremity.

Yet another Workers’ Compensation Judge then granted the injured employee’s Claim Petition in 2008, awarding the injured employee 410 weeks of specific loss benefits for the specific loss of her left arm, finding that the specific loss benefits were payable as of the injured employee’s injury becoming a complete loss of use for all practical intents and purposes in August of 2006.

In addition, a 20 week healing period was also awarded to the injured employee.

The Workers’ Compensation Judge also ordered that the injured employee’s temporary total disability benefits would continue, as the injured employee was totally disabled, and the specific loss benefits would then be payable after total disability benefits concluded.

The injured employee then filed a second Claim Petition, alleging a specific loss of her right lower extremity and right foot, later amending the petition to include a specific loss of her left leg.

In 2009, yet another Workers’ Compensation Judge found that the injured employee’s work injuries had resolved into specific losses of her left arm, and both legs.  Doing so, the Workers’ Compensation Judge granted the Review Petition, awarding 410 weeks of specific loss benefits to the right leg, 410 weeks of specific loss benefits for the left leg, and a 25 week healing period.

The 2009 Decision also resulted in the employer, the City of Philadelphia, being entitled to a credit for weekly temporary total disability benefits that had been paid through the date of the Judge’s 2009 Decision.

An Amended Decision was then issued by the Workers’ Compensation Judge, changing the dates relevant for the interest that would be payable on the various awards of specific loss benefits.

The 2009 Decision was appealed, with the Appeal Board determining that the 2009 Decision incorrectly awarded interest to commence on different dates for each specific loss, with the Appeal Board modifying the Judge’s Decision, to reflect an accrual date, for interest purposes, for all three awards.

The Appeal Board held that the date of accrual for interest was when the evidence proved that the injured employee’s disability injuries had resolved into specific losses, with specific loss benefits then being payable, as temporary total disability benefits ended.

The Appeal Board’s Decision was then affirmed by the Commonwealth Court in the firstFields Decision, issued in 2012.

In 2010, the injured employee filed a Petition to Review Medical Treatment, alleging that she required a personal care attendant, as well as modifications to her home and vehicle, also filing a Penalty Petition, alleging that the employer had violated the Act, by unilaterally reducing her compensation benefits.

In 2011, the Workers’ Compensation Judge concluded that the injured employee had met her burden of proof in support of her Review Medical Petition, without entering a specific award for the costs of the vehicle modifications, and home care services sought, since the injured employee did not present evidence of any modification estimates or service invoices.

The Penalty Petition was denied, on grounds that the Workers’ Compensation Judge found that the employer did not violate the Act.

The Workers’ Compensation Judge also concluded that, based upon the injured employee having multiple specific losses arising from the same injury, that the injured employee could elect to be paid specific loss benefits, rather than indemnity or temporary total disability benefits, but that the injured employee could not receive concurrent multiple awards of specific loss benefits.

This Decision was then appealed by both parties, with the Board disagreeing with the Judge’s determination as to how benefit payments should be made to the injured employee under the Act.  The Board also determined that the injured employee’s specific loss benefits should be paid consecutively, as opposed to concurrently.

Holding that the plain language of Section 306(c)(21) of the Pennsylvania Workers’ Compensation Act dictated that the employer should pay the injured employee specific loss benefits consecutively, the Commonwealth Court concluded, as the employer suggested, that the injured employee was attempting to back-door her specific loss benefits as though the same were being commuted, effectively accelerating the payment of benefits, although there was not a commutation petition before the Court.

Consequently, the Commonwealth Court determined, that an injured employee claiming bilateral specific losses, who chooses to receive the specific loss benefits rather than total disability benefits, mandates that the specific loss benefits should then be paid “in the same manner as the legislature intended other multiple specific losses, … which is consecutively”.

Holding that the injured employee’s disabilities resulted from a single occurrence, the Commonwealth Court ordered that the injured employee’s multiple specific losses should be aggregated pursuant to Section 306(c) of the Act, requiring that the benefits be paid consecutively, and not concurrently.

What is the take away from this specific loss Decision?

Simply put, it is that the Commonwealth Court has now made a bright line line ruling on an issue that rarely arises, being that an employer’s obligation to pay specific loss benefits, for multiple specific losses arising out of the same injury, requires consecutive and not concurrent payments, with an injured employee not being permitted to attempt to accelerate payments, in the absence of the benefits being commuted.

ConnorsO’Dell LLP

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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.

A claimant’s testimony that pain caused by his compensable injury led to his resignation is sufficient to support disability, but only up until such time as the claimant retains new employment earning at least as much as his preinjury wage. APD 141958, decided November 24, 2014.

The Appeals Panel has authority to recalculate an impairment rating based on the figures provided by the certifying doctor in order to correct a mathematical error. APD 141980, decided November 10, 2014.

Where a Hearing Officer finds a Designated Doctor’s certification of MMI/IR is contrary to the preponderance of the evidence based on a misinterpretation of the Designated Doctor’s opinion, the Appeals Panel will remand the issue if there is more than one certification in the record that could be adopted.  APD 141917, decided November 4, 2014.

A Claimant can show good cause for failing to appear at a CCH, even after the 10 day period, if they also have good cause for failing to respond to the 10-day letter. APD 141918, decided November 3, 2014.

A finding that lumbar radiculitis is part of the compensable injury requires expert medical evidence explaining how the mechanism of injury caused that condition. APD 141973, decided November 3, 2014.

This is good news, except it is a shame you have to go to court to get an agreement like this.  In this case, the Division appealed an agreed judgment entered by a trial court where the claimant and the carrier agreed to a reduced payment in amount less than the full amount of SIBs would have been. The Division claimed that the Labor Code is clear on this point, and SIBs can only be paid in the full amount or not at all. The Dallas Court of Appeals rejected all of the Division’s arguments and held that, while neither the Division nor the court could award partial SIBs, nothing prevented the parties from settling to an agreed partial amount.  Tex. Dept. of Ins, Div. of Workers’ Comp. v. Jones, 2014 WL 5768728 (Tex. App.–Dallas 2014, no pet. h.) (mem. op.).

Circumstantial evidence is enough to support a claim for retaliatory discharge. The claimant reported a work injury and was terminated after presenting a doctor’s note keeping him off work. He then brought suit against his employer alleging that he was terminated in retaliation for filing a workers’ compensation claim.   A claim for retaliatory discharge requires that filing a workers’ compensation claim isa reason, but not necessarily the only reason, that the employee was terminated. The burden is on the employee to show the causal connection, the burden then shifts to the employer to show that there was a legitimate reason for the termination, and if it does so the burden then shifts back to the employee to show that the reason was a mere pretext. The Austin Court of Appeals reversed and remanded a summary judgment in favor of the employer because the employer’s stated reason, that the employee was unable to perform his job, was not a nondiscriminatory reason as a matter of law where there was not a uniformly applied termination policy.Phillips v. SACHEM, Inc., 2014 WL  7464035 (Tex. App.–Austin 2014, no pet.).

An injured worker brought extra-contractual claims against her worker’s compensation carrier after the Division held that her injury was compensable.  She claimed damages from misrepresentations under the Insurance Code and unconscionability under the DTPA.  The San Antonio Court of Appeals held that a denial of compensability or payment does not constitute an actionable misrepresentation of the policy, even when later reversed by the DWC. Questions that deal with whether a claim falls within the scope of coverage is not an interpretation of the policy. The court also held that an alleged failure to investigate a claim does not defeat the Supreme Court’sRuttiger holding. In other words, “the sole remedy against [the carrier] for failing to timely pay benefits to [the claimant] is under the Workers’ Compensation Act.”  Vause v. Liberty Mutual Ins. Corp., 2014 WL 6687598 (Tex. App.–San Antonio 2014, no pet.).

Anybody remember Blazing Saddles? The Court will hear argument from Seabright Insurance Company that section 401.011(12) of the Labor Code, regarding course and scope of employment, is ambiguous.  A worker was driving other employees in a company truck from a hotel paid for by the company to a jobsite when the truck was struck by a semi, leading to his death.  Seabright denied the beneficiary’s claim for death benefits because the worker was traveling at the time of the accident and was thus not in the course and scope of employment. In its attempt to avoid paying death benefits to the deceased worker’s beneficiary, Seabright argues thatLeordeanu v. American  Protection  Insurance  Company  has  led  to  confusion  over  section 401.011(12) among Texas’ appellate courts. The Court will determine if the ‘but for’ test is appropriate in this situation; that is, but for his employment, the deceased worker would not have been in the situation that led to his death.  The case isSeabright Insurance Company v. Maxima Lopez, appealed from the Fourth Court of Appeals, Cause No. 01-12-00863-CV and the 229th District Court of Starr County, Cause No. DC-08-484.

As expected, Commissioner Brannan also adopted new Division Rule 131.1 regarding initiation or denial of Lifetime Income Benefits.  Under the new rule, an insurance carrier must review an injured worker’s eligibility for LIBs in a timely manner and review all statutory criteria.  Carriers will have to develop criteria to narrow down which claims may have LIBs exposure. If the insurance carrier believes the injured worker is entitled to LIBs, it shall initiate payment within 15 days even if the claimant has not requested LIBs.  But in the case where an injured worker requests LIBs in writing, the carrier has 60 days to determine eligibility.  Any denial must be on form PLN-4.

A new PLN-4, Notice Regarding Eligibility for Lifetime Income Benefits, has been finalized. The revisions were made to ensure that the injured worker and the Division had a complete explanation as to why the insurance carrier is denying LIBs.  The revised form adds a checkbox to clearly show that eligibility for LIBs is denied followed by a space for a full and complete statement.

States have been cracking down on the lucrative practice of physician dispensing of prescription drugs, a practice largely limited to workers’ compensation doctors. Some doctors are prescribing novel doses of common drugs for which they can charge more. For example, muscle relaxant cyclobenzaprine is commonly prescribed in 5 and 10 milligram doses. However, physicians are dispensing new 7.5 milligram doses of the medication for which they can charge nearly 5 times as much, despite the lack of any medical evidence that the new dose is any more effective.  Another move we are seeing is physicians prescribing complex compounded medications, such as topical creams to treat pain, also despite evidence that these creams are not effective.

Nova Healthcare Management / Nova Medical Centers of Houston, Texas pled guilty to felony worker’s compensation fraud. An investigation by Texas Mutual revealed that Nova was billing for one-on-one physical therapy but was actually providing less expensive group therapy. Under the plea agreement, Nova has withdrawn from the Texas Star Network, repaid $6.5 million to Texas Mutual, and paid a $5,000 fine.