State News

The maximum rate changed on July 1, 2016 to $762 a week.  The minimum work comp rate has increased to $381 a week. 

If you have any questions on work comp rates or general questions, please feel free to contact Charlie Larson atcalarson@boycelaw.com or 605-336-2424.   

Beginning July 1, 2016, the maximum worker’s compensation payable was raised to $832 per week and the minimum was raised to $229 per week. This change was based on the Commissioner of Labor’s determination that the State’s average weekly wage was $831.88 in the calendar year 2015, and the change is effective for any injury occurring on or after July 1, 2016.

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About the Author

This blog submission was prepared by Mike Fish, an attorney with Fish Nelson & Holden, LLC, a law firm dedicated to representing self-insured employers, insurance carriers, and third party administrators in all matters related to workers’ compensation. Fish Nelson & Holden is a member of the National Workers’ Compensation Defense Network. If you have any questions about this submission or Alabama workers’ compensation in general, please contact Fish by e-mailing him at mfish@fishnelson.com or by calling him directly at 205-332-1448.

As you know, Kids’ Chance is a scholarship program for children whose parents have been killed

or seriously injured at work. Donations are tax deductible and we welcome contributions. More

important is that we are looking for eligible scholarship recipients. If you know of an eligible child,

please contact Kids’ Chance in care of Jane Stone, who is on the founding board, at

jstone@slsaustin.com, or call her at 512-343-1300. A big kick-off event is planned for the Fall, too,

and if you or your company are interested in being a sponsor (with appropriate attribution), please

let us know. The deadline for sponsorships is fast approaching.

The US National Toxicology Program, a federal interagency group under the NIH, is said to have

linked radiation from cell phone exposure to cancer in rats in a new study. The researchers exposed

rodents for two years (apparently, a rodents’s life span) to radiation levels designed to roughly match

what a human with heavy cell phone use or exposure might experience. The study results are a long

way from determining if the results of the experiments would be the same if the subjects were

humans. We wonder if the danger to humans will be more or less than the dangers of using a cell

phone while driving (or walking). In any event, if cell phone usage is a work requirement for a

particular injured worker who develops cancer, or gets hit by a bus while distracted by his phone,

there may be some workers’ compensation claims filed.

As many of you know, a broad-based conference was recently held in Dallas by invitation only to

discuss common national issues in workers’ compensation in light of a perceived trend to “opt-out”

plans and the specter of nationalization or doing away with a workers’ compensation system altogether. SLS partner Jane Stone was invited to the Summit as a representative of the National

Workers’ Compensation Defense Network. You may have been following the progress of the

Summit on Bob Wilson’s website. The purpose was to open a dialogue as to what is right in

worker’s compensation programs, and what can be improved. The discussions were lively to say

the least, given that the attendees were so diverse in their views and experiences. The conversations

lasted for 2 days among regulators, judges, insurance professionals, physicians, academics, union

representatives, lawyers (from all sides), and injured workers (both satisfied with the system and

unhappy with it). After the initial conference, the attendees responded to a survey to determine the

priority of topics that were most important. The results of the survey will be published sometime

after July 4th.

Treatment for opioid dependence has long been an issue in workers’ compensation. Now that the

FDA has approved implants which will provide a constant, low dose of the drug buprenorphine to

a patient who is already stable on other forms of the drug, such as pills or sublingual films, requests

for the implant should begin to show up in preauthorization requests, given that buprenorphine is

an “N” drug.

The State Office of Administrative Hearings recently decided to deny payment for compounded

medications which are usually various topical creams which are touted as relieving pain or healing

scars. Texas insurance carriers have been seeing bills of more than $12,000 for a one month

prescription. It was thought by some that so long as the compound didn’t contain an “N” drug from

the DWC’s closed formulary, preauthorization under DWC Rule 134.600 was not required. But the

insurance carrier in this case decided to deny payment based on the defense that Rule 134.600

requires that investigational or experimental drugs be preauthorized. SOAH determined, based on

expert testimony from Dr. Suzanne Novak and her expertise in the application of the ODG treatment

guidelines, that compounded drugs are by their very nature investigational and experimental. That

being the case, the creams would require preauthorization. Many in the pharmacy and treatment

industries disagree, but for now, at least we know which way the wind is blowing.

The Texas Supreme Court issued a decision blowing apart an attempt at settlement of a partial SIBs

quarter. Bonnie Jones and the workers’ comp carrier had taken a dispute over the 14th quarter of

SIBs through the agency and into district court. The DWC had determined that Ms. Jones was not entitled to benefits for that quarter and Ms. Jones took the case up. In the district court proceedings,

Ms. Jones agreed to a partial payment for the quarter and the proposed judgment incorporating the

settlement was sent to the DWC. The Labor Code requires that all proposed judgments be submitted

to the DWC so the agency can decide if there is a reason to intervene in the case. After reviewing

the proposed judgment, the DWC exercised its right to intervene and oppose the judgment on the

basis that the agency had already found that Jones had not fulfilled the mandatory work search

requirements for the 14th quarter, and that a partial SIBs award, even if both parties agreed, “flouts

the statutory formula’s edict to calculate the monetary entitlement in a precise way.” The trial court

went ahead and granted the judgment anyway, and the court of appeals affirmed, citing the longstanding

general policy of encouraging settlement. But, as stated in the Supreme Court’s opinion,

the trial court and court of appeals“ignor[ed] the particularities that the revamped workers’ comp

scheme provides.” Bottom line: SIBs entitlement is all or nothing for each quarter – no partial

settlements allowed. One wonders whether the parties attempted the same settlement at the agency

level. It seems an odd case for the agency to spend resources to pursue what seems to be an issue

of minor significance. Texas Dept. of Ins., Division of Workers’ Compensation v. Bonnie Jones and

American Home Assurance Company, (Tex. 2016) No. 15-0025, opinion issued June 24, 2016.

So far, all we know is that the scam involved Federal workers’ compensation claims, but it is hard

to believe that Texas workers’ comp was not hit as well. More to come on that, but in the meantime,

spread the word. Attorney Tshombe Anderson was arrested last Friday, and his wife Brenda

Anderson and sister Lydia Bankhead are in federal custody. The fronts they are alleged to have used

were Best First Administration Durable Medical Equipment of Austin, Union Medical Supplies &

Equipment LLC, Sky-Care Medical Supplies & Equipment LLC, and American Federal Union

Claims Advocates LLC. This story ran in the Dallas Morning News, and here’s the link:

http://crimeblog.dallasnews.com/2015/08/dallas-attorney-and-family-members-charged-with-defraudingworkers-

comp-out-of-22-million.html/ .

Lois Scafuri filed three workers’ compensation claims alleging occupational exposures as a sales assistant caused her severe neck pathology.  She worked at the Short Hills Mall for two employers: Sisley Cosmetics and Neiman Marcus Group.  She later worked for Bloomingdale’s/Macy’s in the same capacity.  All three employers denied her claims asserting that her neck pathology was simply the result of the natural aging process.

Scafuri did actually have a truamatic accident on August 3, 2005 when she slipped in the stockroom and struck her head on a metal shelving unit.  She did not, however, file a workers’ compensation claim and obtained treatment on her own.  She claimed that she was afraid she would be fired had she filed a claim at that time.  An MRI done five months after the fall revealed cervical spondylolisthesis and a disc protrusion at C3-4 with compression of the spinal cord at C4-5.  She had a cervical fusion at C4-5 and C5-6.

In November 2006 she was diagnosed with myelomacia, which is a softening of the spinal cord.  Six months later she left Sisley Cosmetics and Neiman Marcus Group to work for Bloomingdale’s/Macy’s, and she only worked there until November 2007. Her neck continued to worsen and she had another fusion surgery in December 2007. She filed for and received Social Security Disability benefits.

Not until June 2008 did she bring her occupational claims against her three employers, but by then it was too late to file for the specific accident in 2005.   She claimed that doing make-up applications, facials, packing and unpacking boxes, and lifting boxes containing small cosmetics caused or aggravated her neck condition.  Respondent Bloomingdale’s produced witnesses from the same department disputing the physical nature of the job.  The Judge of Compensation ruled that her work activities did not contribute to her disability under N.J.S.A. 34:15-31, the occupational provision of the New Jersey statute.  The judge also did not accept petitioner’s testimony that she would do overhead lifting in violation of her doctor’s orders.

Petitioner appealed and the Appellate Division reviewed the testimony of the experts as well as the lay witnesses.  The Court noted that Dr. Alexander Vaccaro did give an opinion favorable to petitioner but also conceded that petitioner had a progressive disability.  Although petitioner at first denied having prior neck problems, she admitted that she filed a workers’ compensation claim for her neck against Macy’s in 1993 and had lumbar spondylosis since age 19.  The Court also deferred to the Judge of Compensation in finding that Dr. Charles Effron’s testimony for respondent was more credible than that of Dr. Vaccaro for petitioner in stating that there was nothing petitioner did at work that was any different that what she would do outside work.  Dr. Effron insisted that petitioner’s condition was age related.

The Appellate Court affirmed the Judge of Compensation on the dismissal of all three claim petitions as well as petitioner’s claim petition against the New Jersey Second Injury Fund.  This was a significant ruling because petitioner would certainly have been found totally disabled had she prevailed on her occupational aggravation claim.  The case shows the importance of a key provision in Section 31, which states: “Deterioration of a tissue, organ or part of the body in which the function of such tissue, organ or part of the body is diminished due to the natural aging process thereof is not compensable.”  It also shows how important it is for respondents to produce their own witnesses at trial and not just allow petitioner to constitute the only lay witness in the case.  This case can be found at Scafuri v. Sisley Cosmetics, USA, Inc., A-2065-14T3 (App. Div. June 24, 2016).

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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.