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On April 2, 2015, Alabama Republican State Senators Del Marsh and Cam Ward submitted Senate Bill 330, which proposes drastic reforms to The Alabama Workers’ Compensation Act. If the legislature passes SB-330 and Governor Bentley signs it into law, it would be the biggest change to the Act since the 1992 Amendments. A full text of the proposed bill can be found , but the major proposed changes are outlined below.

MY TWO CENTS:

The last time we saw this many proposed changes to the Alabama Workers’ Compensation Act was on December 9, 2011, when State Senator Arthur Orr (R-Decatur) pre-filed a bill (SB77) for the 2012 legislative session. That bill never made it out of the Senate Business and Labor Committee. I would not expect this bill to make it out of committee either. There are simply too many controversial suggested revisions lumped together into one bill for there to be any chance of success. In order for such broad sweeping change to take place, it will be necessary to form a committee where all interested parties are represented and then hammer out a bill that is mutually acceptable before it is filed. That is the process that allowed the 1992 amendments to become law.

If SB-330 becomes law, § 25-5-11.1 of the Act would be amended to make it illegal for an employer to terminate an employee where the "substantial motivating factor" for the termination is that the employee instituted or maintained a workers’ compensation claim. Under the current law, the employee must prove that filing a workers’ compensation claim is the sole reason for the termination.

MY TWO CENTS:

Alabama is an employment at will state. This means you can fire someone for a good reason, a bad reason, or no reason at all. We currently have an exception to that rule in § 25-5-11.1 when the employee can prove that he or she was terminated solely for filing a workers’ compensation claim or filing a written notice of a safety rule. This means that if the employer had another valid reason for terminating the employee, then it is not considered to be a wrongful termination. If the employee can demonstrate that the other reason is a mere pretext, then it does not qualify as another valid reason and it would still be considered wrongful termination. To allow the new standard proposed above would have the effect of forcing employers to retain bad employees. It would also likely encourage more misconduct on the part of injured employees because of their new termination proof status.

§ 25-5-56 would be amended to provide a presumption that any settlement would be in the best interest of the employee, so long as the employee is represented by a licensed Alabama attorney. Additionally, any proposed settlement rejected by the Court would be reassigned to another judge and any statements or arguments made by the parties, witnesses or judge at the settlement hearing where the settlement was not approved would not be admissible in subsequent proceedings. Additionally, §25-5-56 would provide that advanced payments or payments of medical benefits of any kind shall not be considered an admission against interest or admission of liability.

MY TWO CENTS:

This is a good idea and would likely have unanimous support. The judge reassignment and confidentiality aspect of the bill was actually addressed by a committee appointed by then presiding judge of Jefferson County, Scott Vowell over 10 years ago. Both employee and employer interests agreed that it was a good idea and Judge Vowell adopted it as a local rule. The advanced payments aspect of the bill is already addressed by the Alabama Rules of Evidence. Evidence of such payments is already not admissible.

§ 25-5-57 would be substantially amended by increasing the number of weeks for permanent partial disability (PPD) benefits from 300 to 400 weeks. Additionally, permanent total disability (PTD) benefits would be cut off either after 500 weeks or after the employee attains 75 years of age – whichever is longer. §25-5-68 would be amended to completely remove the $220.00 per week statutory PPD cap, replacing it with a cap equal to 80% of the state’s average weekly wage or 100% of the employee’s pre-injury average weekly wage – whichever is less. To put that in perspective, an employee earning $1,000 per week who suffers a back injury resulting in a 50% permanent partial disability would be entitled to as much as $150,000. Under the current law, the employee would be limited to a maximum of $66,000.

MY TWO CENTS:

The $220 cap is low and probably needs to be bumped up at least to some degree. However, there needs to be a conversation between employee and employer interests on how best to effectuate such change. Simply introducing a bill proposing such drastic change does nothing more than make such change impossible during this legislative session. The proposed caps on PTD are a good start on how to negotiate such change but there needs to be more discussion.

§ 25-5-77 would be amended to provide that if an employee is dissatisfied with the initial treating physician selected by the employer and further treatment is required, the employee may select a new physician from a panel ofsix physicians selected by the employer (currently it is four). Additionally, § 25-5-77 would be amended to provide that if five years pass during which time an injured employee receives no medical treatment by his or her authorized treating physician for the injury, there would be a rebuttable presumption that any subsequent medical treatment would be unrelated to the injury. Additionally, after seven years without such treatment, there would be a conclusive presumption that the employee would not be entitled to any further medical treatment – with previously implanted medical or prosthetic devices being the sole exception. There would also be new provisions providing for pain management treatment and requirements that an injured worker receiving controlled substances sign a formal written agreement with the pain management physician. Under the proposed law, if the employee violates the agreement, her or she may lose his or her right to further pain management treatment. Another new provision would allow employers to select the pharmacy where injured workers’ get there prescriptions filled.

MY TWO CENTS:

It is hard enough to populate a panel of four in some of the more rural areas of Alabama. Requiring a panel of six could become impossible in some situations. Especially when you have an employee that gets kicked out of pain management or dismissed from the care of a treating physician for bad or inappropriate behavior. The five and seven year cut off periods sound nice but the reality is that we will see requests to return to the doctor every 4 years even when treatment is not needed. The pain management cut off aspect of the bill sounds nice except that it says may rather than shall. This means that it has absolutely no meat to it and renders the employer powerless to cut benefits when the employee is getting kicked out of pain management.

§ 25-5-88 would be amended to provide that the Courts must enter judgment within ninety (90) days of any workers’ compensation trial. Additionally, the bill would increase the maximum amount of attorney’s fees an injured worker’s attorney can charge, from 15% to 25%. It would also provide that a court can award up to 25% of the reasonable value of medical services, if the legal services provided for the injured worker are for the procurement of medical treatment previously denied.

MY TWO CENTS:

I have never understood why attorneys are limited to 15% on the award of indemnity benefits. I think that raising it is probably a good idea. However allowing a fee representing 25% of the reasonable value of denied medical services is a bad idea. If an employer exercised its right to deny a back injury claim and the judge subsequently ordered that it was compensable, the fee on the medical alone could end up being higher that the contingency fee on the indemnity award. Such an award would be more in the nature of a penalty and have the effect of scaring employers into paying for treatment that may not be owed.

§ 25-5-110 would provide compensation for psychological conditions which result from the hazards of the employment in excess of those ordinarily incident to employment in general, even if the psychological condition was not precipitated by a physical injury to the body.

MY TWO CENTS:

Alabama is a physical-mental state. This means you have to have a physical injury before you can successfully claim any type of psych condition. You do not have to have a significant physical injury but you have to have been physically injured at least to some degree. To allow employees to claim psych without the physical injury requirement would open the flood gates of psych claims.

§ 25-5-293 would be amended to require that utilization reviews be conducted by a board certified physician of the same specialty, licensed in Alabama.

MY TWO CENTS:

This would not be a terrible idea if it also included a presumption that such an opinion by a UR doctor would be considered to carry the same weight as the authorized treating physician. As it stands now, Alabama judges almost always side with the treating physician so it is unclear what this part of the bill is trying to accomplish.

Changes to § 25-5-311 would amend the composition of the Workers’ Compensation Medical Services Board. Instead of five licensed Alabama physicians, the Board would be comprised of two claims professionals chosen by the Alabama Workers’ Compensation Organization (AWCO), two employer representatives chosen by the Alabama Counsel of Association of Workers’ Compensation Self-Insureds’ Fund, two physicians and two provider practice managers chosen by the Medical Association of the State of Alabama, four hospital representatives chosen by the Alabama Hospital Association, a physical therapist chosen by the Physical Therapist Association of Alabama, two "employee representatives", chosen by the Alabama Association for Justice (the trial lawyers), and one judge chosen by the Alabama State Bar. Medical providers, other than hospitals, would be reimbursed at a rate equal to an amount 7.5 % greater than the rate customarily paid by the largest health care service plan in the state. Hospitals would be entitled to a maximum reimbursement rate of 1.2 times the Medicare National Base Rate multiplied by the Diagnosis-Related Group Weight Value as published by Medicare. Brand name drugs would be reimbursed at a rate equal to the average wholesale price, plus $5.00. Generic drugs would be reimbursed at 30% less than the wholesale price, plus $5.00. Additionally, injured workers not be allowed to have the medication prescriptions filled in any facility or business establishment in which the prescribing physician has a financial interest.

MY TWO CENTS:

This probably gives us a good road map on how to form a committee that can actually effectuate change that is mutually acceptable to all. Without all interested parties at the table negotiating a true compromise, nothing is likely to ever be accomplished. For an example of how it was done in 1992, I suggest that you read the first four paragraphs of Tuscaloosa attorney Steve Ford’s articleNew Alabama Workers’ Compensation Act published in The Alabama Lawyer in September of 1992. If you would like a copy, please shoot me an e-mail and I would be more than happy to send you one.

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ABOUT THE AUTHORS

The summary of SB-330 was written by Charley Drummond and the My Two Cents portion was written by Mike Fish. Both are attorneys at Fish Nelson & Holden, LLC, 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. The firm is a member of The National Workers’ Compensation Defense Network (NWCDN), which is a national network of reputable law firms organized to provide employers and insurers access to 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 authors atmfish@fishnelson.com, cdrummond@fishnelson.com, or (205) 332-3430.

United Heartland, Inc. and Camanche Community School District v. Kathaleen Brown, Court of Appeals of Iowa, No. 14-1070

Claimant, Kathaleen Brown, taught fourth grade at the Camanche elementary school from 1998 through 2010. In the fall of 2000, Claimant developed severe bronchitis and also received treatment for multiple asthma attacks. Between March 2003 and May 2010, Claimant saw her family physician more than two dozen times for respiratory problems. After being hospitalized for pneumonia in 2007, Claimant noticed mold on the filter of a humidifier she had brought into her classroom. The school followed up with four separate indoor air quality investigations between 2008 and 2011. The 2008 study revealed ventilators in Claimant’s classroom were “covered by a layer of particulate material.” Carpet dust samples showed fungal growth. An industrial hygienist suggested the school develop a “remedial cleaning strategy.”

Following a reactive breathing attack at school in May of 2010, Claimant did not return to work. On June 2, 2010, Claimant sought an opinion from Dr. Charles Bruyntjens, a pulmonary specialist. He diagnosed Claimant with occupational environmental lung disease, hyper-reactive airways, and shortness of breath. He found the school environment either started her condition or aggravated a preexisting condition.

Claimant filed a claim for workers’ compensation benefits on October 28, 2010, alleging she was exposed to contaminants in her workplace affecting her lungs, bronchial passages, and whole body. The school district filed an answer denying her allegations.

In April 2011, Claimant saw Dr. Jason Wittmer, a pulmonologist. Dr. Wittmer found no abnormal lung function and no airway obstruction. In August 2011, Claimant’s attorney arranged for an independent medical examination with Dr. Joel Kline. Dr. Kline reached an opinion that Claimant suffered from asthma, which had been substantially aggravated by exposures she received while at the school. In September 2011, the school district’s attorney sought an opinion from Dr. Laurence Fuortes. Dr. Fuortes opined “the elementary school was not grossly contaminated” at least “in the post remediation period.” Dr. Fuortes also found Claimant did not show a “chronic impairment of the respiratory system.”

On April 10, 2012, a deputy workers’ compensation commissioner issued an arbitration decision finding Claimant met her burden of proving an injury arising out of her employment. The school district appealed and the arbitration decision was affirmed on May 9, 2013. The school district sought judicial review. The district court affirmed the agency’s decision. The school district challenges the judicial review ruling on appeal.

The school district contends substantial evidence does not support the acting commissioner’s conclusion that Claimant suffered from “a pulmonary function injury” related to her work. The school district highlights the opinions of Dr. Wittmer and Dr. Fuortes and also contends the agency found Dr. Bruyntjens “was simply not credible” and asserts Dr. Kline’s opinion was based on erroneous information supplied by Claimant. Additionally, the school district argues Claimant cannot show her injury was caused by harmful conditions in the elementary building.

The Court of Appeals finds substantial evidence to back the agency’s conclusion that Claimant suffered a pulmonary function injury. The agency was entitled to rely on Dr. Kline’s assessment of Claimant’s lung injury and its nexus to the school environment, as well as accepting at least some of the opinions from Dr. Bruyntjens. The Court of Appeals also agrees with the district court that the agency record contains expert evidence establishing a causal connection between her injury and conditions in the elementary school. The record is replete with proof that water had infiltrated the roof and ceiling tiles in the fifty-year-old wing of the school building that housed the fourth grade classrooms where Claimant taught.

In summary, the Court of Appeals finds that the agency’s findings of fact were supported by substantial evidence and its application of law to the facts was not irrational, illogical or wholly unjustifiable.

Call Mark Bosscher or Lee Hook with any questions @ 515-243-2100.  We’d be happy to help, whether it be a quick or a complex issue!

 

On March 20, 2015, the Alabama Court of Civil Appeals released its opinion in Good Hope Contracting Company, Inc. v. McCall wherein it upheld an order compelling medical treatment but reversed an award of attorney’s fees. At the trial court level, evidence was presented that the authorized pain management doctor recommended a steroid injection. The request was sent to utilization review (UR) and it was determined not to be medically necessary by an orthopedic surgeon with a subspecialty in pain management. Based on the UR doctor’s opinion, the procedure was denied. The employee then filed a motion to compel the procedure and a motion for contempt alleging that proper UR protocol was not followed. Specifically, it was alleged that the orthopedic surgeon was not a peer of the authorized pain management doctor because managing pain was not is specialty. The trial court granted the motion to compel the injection but declined to grant to the motion for contempt. Despite this fact, the Court still awarded $18,375.00 in attorney’s fees.

On appeal, the Alabama Court of Civil Appeals upheld everything but the award of attorney’s fees. In order for such fees to be awards, the employee would have needed to be successful on his motion for contempt.

My Two Cents:

In the Unites States, attorney’s fees are not typically awarded to the prevailing party absence absent a contractual obligation or unless the prevailing party can demonstrate willful and contumacious behavior on the part of the opposing party. This is known as the American Rule. In this case, the Court of Civil Appeals determined that, because proper UR procedures were followed, the employer had a legitimate, debatable and arguable basis for its denial and, therefore, could not be held in contempt of court. Had the Court of Civil Appeals allowed the award of attorney’s fees to stand in this case, it would have resulted in similar motions being filed every time employers exercised their lawful right to deny medically unnecessary treatment in a permissible manner.

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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 atmfish@fishnelson.com or by calling him directly at 205-332-1448.

NID, Inc., and Great West Casualty Company v. Troy Monahan, Court of Appeals of Iowa, No. 14-0292

On March 15, 2007, Claimant, Troy Monahan, fell at work, landing on his left side. He treated at a local hospital and was prescribed medication. On September 28, 2007, NID assigned Claimant to a project. Claimant did not think he was physically able to do the project, and he left without ever returning to work. Over the next two years Claimant treated on multiple occasions for pain on his left side.

On February 26, 2009, Claimant filed his petition in arbitration, alleging a March 15, 2007, work-related injury to his upper left extremity, including shoulder, elbow, and hand. The matter came on for hearing in March 2010. The joint hearing report shows the parties stipulated that Claimant sustained an injury on March 15, 2007, that arose out of and in the course of his employment with NID. The parties disputed whether the injury caused disability, Claimant’s entitlement to healing period benefits or to permanent partial disability benefits, and whether Claimant’s medical expenses were causally connected to the injury.

On June 1, 2010, Monahan filed a petition for alternate medical care seeking arthroscopy recommended by Dr. Neff, an orthopedic surgeon who Claimant, on his own volition, treated with. NID filed its answer, disputing liability for Claimant’s “current left shoulder complaints for which he seeks care.” The agency dismissed the petition for alternate care.

On October 27, 2010, the agency filed its arbitration decision. The deputy found Claimant’s work injury was causally related only to the left hand carpal tunnel syndrome and awarded benefits for the period Claimant was off work following carpal tunnel surgery. The deputy ordered that Claimant was entitled to alternate medical care, specifically that “defendants shall provide claimant a second opinion by an orthopedic doctor of their choosing for his shoulder.” The parties appealed and cross-appealed the arbitration decision. In April 2012, the agency issued its appeal decision, affirming and adopting the arbitration decision.

On April 15, 2013, Claimant filed a second application for alternate medical care. The agency dismissed the application, explaining “before any benefits can be ordered, including medical benefits, compensability of the claim must be established, either by admission of liability or by adjudication.” The agency granted Claimant’s request for rehearing. It held the defendants were “barred by the doctrine of res judicata from contending they are not liable for claimant’s continued shoulder problems.” The rehearing decision also stated: “Since the April 2, 2012 appeal decision, defendants have not provided claimant with a second opinion regarding care for his shoulder injury. Defendants are therefore ordered, once again, to provide the alternate medical care prescribed in the October 27, 2010 arbitration decision in this case.” The agency then imposed attorney’s fees and costs as a sanction against NID.

NID sought judicial review of the rehearing decision. The district court concluded the application for alternate medical care “should have been dismissed” because causation was still at issue. The court remanded the case to the agency to hold a hearing on causation. Both parties filed post-ruling motions. The court summarily denied all postruling motions. This appeal and cross-appeal followed.

Claimant concedes the agency erred in applying the doctrine of res judicata to conclude that NID was barred from contesting causation and liability. He argues that the agency decision should nonetheless be affirmed by application of the doctrine of judicial estoppel because NID previously stipulated to causation and liability. The Court of Appeals concludes NID stipulated only that Claimant suffered a work-related injury. NID actually contested causation and liability at every point in these proceedings. Because NID has not asserted inconsistent positions, there is no reason to apply the doctrine of judicial estoppel. The Court of Appeals thus affirms the district court insofar as it held the agency committed legal error in holding res judicata barred NID from denying causation and liability and also insofar as it declined to judicially estop NID from denying causation and liability.

Additionally, the Court of Appeals agrees with the district court that section 86.42 is the appropriate method for seeking judicial enforcement of the agency’s orders and that the agency erred by ordering compliance with the agency’s prior order in the context of an alternate care proceeding. The agency does not have the authority in an alternate medical care proceeding under section 85.27(4) to enforce a prior order.

Finally, the Court of Appeals finds sanctions against NID were not appropriate. The agency’s primary basis for imposing sanctions was NID’s failure to comply with the appeal decision and obtain a second medical opinion regarding Claimant’s shoulder. That issue was not properly before the agency in this alternate medical care proceeding, and NID had a legitimate basis to contest causation and liability.

Given the Court of Appeals’ conclusion the agency erred in applying res judicata, erred in issuing an enforcement order in an alternate medical care proceeding, and erred in imposing sanctions, the appropriate remedy is remand to the agency for dismissal of the alternate medical care petition.

Tyson Foods v. Maria Gaytan, Court of Appeals of Iowa, No. 14-1397

Claimant, Maria Gaytan, suffered a left shoulder injury while working at Tyson’s in November 2005. She filed a petition in arbitration for workers’ compensation benefits with the Iowa Workers’ Compensation Commissioner. In his arbitration decision, the deputy commissioner concluded the injury was the cause of permanent disability and Claimant had “a 40 percent loss of earning capacity or industrial disability.” Claimant was awarded two hundred weeks of permanent partial disability benefits. Tyson did not seek intra-agency review of the decision.

In June 2010, Claimant underwent left shoulder surgery. In March 2012, Claimant filed a review-reopening petition asserting a change of condition since the arbitration decision. She claimed she suffered additional industrial disability as a result of the November 2005 injury. In his review-reopening decision, the deputy commissioner found that at the time of the arbitration decision, Claimant had a two percent permanent impairment to the body as a whole. Since her surgery, Claimant’s functional impairment had risen to ten percent to the body as a whole. Given this record, Claimant had carried her burden of proof that she had a change in condition related to her work injury with Tyson since the original award of benefits. The deputy then awarded Claimant healing period benefits from June 23, 2010, through May 24, 2011, and permanent total disability benefits commencing on November 22, 2005.

Tyson appealed the decision to the Commissioner, and the Commissioner affirmed the decision without additional comment. Tyson then filed its petition for judicial review. In denying the petition, the district court concluded there was substantial evidence of a change in Claimant’s condition after the original arbitration decision and substantial evidence supported an award of permanent total disability benefits under the odd-lot doctrine and an award of healing period benefits from June 23, 2010, through May 24, 2011. The district court affirmed the Commissioner’s review reopening decision in its entirety.

Tyson now appeals, arguing substantial evidence does not support a finding that Claimant sustained a change in condition since the original arbitration decision. It also argues the award of permanent total disability benefits was not supported by substantial evidence.

The Court of Appeals affirms the district court’s decision affirming the Iowa Workers’ Compensation Commissioner’s decision. The Court noted that the district court’s ruling identifies and considers all the issues presented. The cardinal rule of administrative law is that judgment calls are within the province of the administrative tribunal, not the courts, and the Court is statutorily obligated to afford due deference to the commissioner’s findings of fact.

Call Mark Bosscher or Lee Hook with any questions @ 515-243-2100.  We’d be happy to help, whether it be a quick or a complex issue!

Steven J. Bell Jr. v. 3E a/k/a Electrical & Engineering Co., and Travelers Indemnity/CT, Court of Appeals of Iowa, No. 14-0044

On March 19, 2010, Claimant, Steven Bell Jr., was working as an “inside sales” representative for Electrical & Engineering Co. (3E) when he slipped and fell in the 3E lobby. The fall resulted in a left wrist sprain, a trauma-induced ganglion cyst, lower back strain, and a contusion to the left shoulder and elbow. Claimant underwent surgery to remove the cyst from his wrist in early May and continued physical therapy for his wrist and shoulder. After leaving physical therapy in mid-May 2010, Claimant returned at the end of the month complaining of increased back pain. An MRI done on Claimant’s back revealed no problems or “abnormalities of the lumbar spine.” On June 24, 2010, Claimant was released to work without restrictions. 

On June 4, 2010, Claimant filed a petition with the workers’ compensation commission. The deputy found Claimant’s accident left him with a five percent industrial disability. On October 15, 2012, the commissioner adopted the findings of the deputy. Claimant sought judicial review, and on July 9, 2013, the district court affirmed the commissioner on all grounds. Claimant now appeals.

Claimant argues the commissioner erred in not considering his possible career as a firefighter in determining his lost earning capacity. Claimant received a degree in fire and science technology in 1997 and passed the examinations required to serve as a firefighter, but had not applied for any firefighter positions since 1997. He claims the workers’ compensation statute does not require an employee to have pursued a particular position to establish he or she has the capacity to perform it. The Court of Appeals agrees with the district court’s analysis in finding that the commissioner “properly considered the fact of [Claimant]’s minimal work experience as a firefighter when he chose not to include any lost earning capacity from employment as a firefighter.”

Claimant also claims the commissioner failed to make the credibility findings required by Iowa Code section 17A.16 (2011). The Court of Appeals finds the agency complied with section 17A.16, noting, “We do not hold the commissioner to technical compliance with this provision as long as we can determine where finding of facts end and conclusions of law begin or otherwise can track the commissioner’s analytical process.” The agency decision is divided into a finding-of-fact section and a conclusion-of-law section. The decision logically sets forth the commissioner’s thought process. The decision gives specific findings on Claimant’s credibility and while other credibility findings are not explicit, they can be discerned from the direction of the analysis.

Claimant also argues the issue of permanent disability was not ripe for adjudication because the doctors did not find he had reached maximum medical improvement (MMI) for his back injury. The Court of Appeals finds the commissioner’s decision that Claimant had reached MMI was supported by substantial evidence. In an independent medical examination, a doctor opined the Claimant had reached MMI for his back in June 2010 and only suggested future treatment for pain management; ongoing pain does not extend the healing period if it does not decrease the industrial disability.

Douglas Moad, By his Wife Sharon Moad, v. Gary Jensen Trucking, Inc., Court of Appeals of Iowa, No. 14-0164

Claimant, Douglas Moad, worked as a truck driver for Gary Jensen Trucking, Inc. On December 1, 2008, Claimant was driving his truck within the course of his employment when an SUV driver drove his SUV across the median and struck Claimant’s truck head-on. The other driver died at the scene. Claimant died roughly three months later. Thereafter, Claimant’s wife Sharon filed a claim for workers’ compensation death benefits on Claimant’s behalf, asserting the injuries from his December accident were the cause of his eventual death. Defendant admitted Claimant suffered injuries in his accident, but it denied that those injuries caused or contributed to Claimant’s death.

A hearing was held before a deputy workers’ compensation commissioner in September 2012. Several conflicting expert opinions were offered on the cause of Claimant’s death. Dr. Bruce, the cardiologist who treated Claimant the day of his demise, testified it was his opinion that Claimant’s probable cause of death was a massive pulmonary embolus, though it was also possible he died from a massive myocardial infarction. Dr. Watt testified that the consequences from Claimant’s accident could lead to the tendency to have a pulmonary embolus. The employer’s expert, Dr. Ronald Vessey, opined it was “most probable” that Claimant “died of the sudden death syndrome secondary to having developed an acute event.” Sharon’s expert, Dr. Dan Fintel, a cardiologist, concluded that “a cardiac etiology was the most likely cause of [Claimant’s] persistent chest discomfort, and was a direct consequence of the motor vehicle accident.”

In November 2012, the deputy commissioner entered his decision denying Sharon’s claim. The deputy noted the opinions of Drs. Vessey and Fintel and stated that the “opinions of both doctors are possible scenarios, and perhaps equally persuasive (reading Dr. Fintel’s opinions in the best light). However, the claimant has the burden of proving causation by a preponderance of the evidence.” Sharon appealed the deputy’s decision, and the Iowa Workers’ Compensation Commissioner affirmed the decision. Sharon then filed a petition for judicial review of the commissioner’s decision, challenging the agency’s factual findings, its legal conclusions, and its application of facts to the law. Following a contested hearing, the district court entered its judicial review ruling reluctantly affirming the agency decision.

The Court of Appeals affirms the district court’s ruling, finding substantial evidence supports the agency’s finding that Sharon did not prove by a preponderance of the evidence that Claimant’s accident was a cause of his tragic death. The commissioner relied upon Dr. Vessey’s opinion that Claimant was simply “one of the 250,000-300,000 Americans who die every year of cardiovascular collapse.” Consequently, the agency’s decision was supported by substantial evidence, and the Court of Appeals cannot conclude the agency’s decision to accept Dr. Vessey’s opinion over the other experts was irrational.

Sharon Moad, Individually and as Personal Representative of the Estate of Douglas Moad, et al., v. Richard Libby, as Personal Representative of the Estate of Matthew Libby, et al., and Dakota Truck Underwriters, et al., Court of Appeals of Iowa, No. 14-0290

Douglas Moad was a resident of South Dakota. He was employed as a truck driver by a South Dakota trucking company, Dakota Truck Underwriters (DTU). Pursuant to South Dakota law, DTU voluntarily paid workers’ compensation benefits to Moad arising out of a work-related traffic accident occurring in Iowa. Douglas Moad accepted the workers’ compensation benefits paid by DTU. Douglas deceased several months after the traffic accident. Sharon sought workers’ compensation benefits in Iowa. She also filed this civil suit against the motorist causing the traffic accident. DTU intervened in this case, asserting a workers’ compensation subrogation lien for the benefits paid to Douglas. Ultimately, Sharon settled this case with the underinsured and uninsured motorist insurance carriers and moved to strike the subrogation lien on the settlement proceeds. The parties agreed that DTU had a right to reimbursement if South Dakota law controlled the subrogation question and no right to reimbursement if Iowa law controlled the subrogation question.

The district court held Iowa law applied and granted Sharon’s motion to extinguish DTU’s lien. DTU appealed. In the first appeal, the supreme court concluded the district court and this court incorrectly analyzed the conflict of laws issue. The supreme court remanded the case “to the district court to consider the extent to which section 185 of the Restatement (Second) applies in this case.” The district court concluded Restatement (Second) section 185 applied to this case, concluded that South Dakota law controlled the subrogation question, and held that DTU had a valid lien against the settlement proceeds under South Dakota law for compensation benefits already paid to Moad.

Sharon timely appealed the district court’s order. Sharon first contends the district court erred in concluding Restatement (Second) section 185 was applicable to this case. Section 185 provides as follows:

"The local law of the state under whose workmen’s compensation statute an employee has received an award for an injury determines what interest the person who paid the award has in any recovery for tort or wrongful death that the employee may obtain against a third person on account of the same injury."

Sharon contends an “award” can only be paid following an adjudicative determination of entitlement to benefits, and as DTU voluntarily paid workers’ compensation benefits, section 185 is inapplicable. The Court of Appeals disagrees, finding that Sharon’s interpretation of section 185 is too narrow. Sound policy reasons actually militate against Sharon’s interpretation of section 185; it is at odds with workers’ compensation schema, generally, to adopt a rule that incents employers and insurance carriers to contest claims for no reason other than to preserve subrogation rights.

Sharon also argues that South Dakota law should not determine the subrogation issue because she filed in Iowa a workers’ compensation claim for benefits related to Douglas’s death. The Court of Appeals disagrees, stating that the fact that Sharon sought additional benefits in Iowa is not at all relevant to whether DTU has subrogation rights for benefits already paid pursuant to another state’s law.

Accordingly, the Court of Appeals finds the district court did not err in applying section 185 of the Restatement (Second) of Conflict of Laws and did not err in denying the plaintiff’s motion to strike the lien. The case is remanded to determine the amount of the lien.

Heritage Care and Rehabilitation and Midwest Employer’s Insurance Company v. Debra True, Court of Appeals of Iowa, No. 14-0579 

Claimant, Debra True, began working in 2007 as a dietary aide for the employer. She injured her right shoulder while taking out the trash in 2010. Medical treatment was provided for a short time. Claimant did not miss any days of work due to the injury, so no weekly workers’ compensation benefits were paid. On March 1, 2011, Claimant filed a petition with the workers’ compensation commissioner seeking medical benefits under Iowa Code section 85.27 (2011) for the injury. The case was set for a hearing on February 24, 2012.

Prior to that hearing on January 20, 2012, Claimant filed a motion to amend her petition to include a claim for temporary and permanent disability benefits. Claimant also submitted, and the commission accepted, a $100.00 filing fee. The case proceeded to hearing on February 24, 2012, where it was brought to the deputy’s attention that the $100.00 filing fee was paid and accepted with the motion to amend. Because the fee was accepted, the deputy concluded the agency had deemed the motion to amend to be a petition in arbitration, that filing had occurred prior to the running of the statute of limitations, and therefore, Claimant should be permitted to make a claim for weekly benefits.

After the hearing, the deputy issued a decision awarding a thirty-percent industrial disability to Claimant. The employer appealed to the commissioner, who summarily affirmed the award of benefits and also affirmed the deputy’s decision regarding the motion to amend. The employer filed a judicial review petition with the district court challenging the agency’s ruling on the statute of limitations issue and the award of benefits. The district court affirmed the agency’s decision, and the employer now appeals.

The Court of Appeals concludes the agency’s decision to permit the amendment is not irrational, illogical, or wholly unjustifiable. The employer asserts this ruling was in error because Claimant was required to file an original notice and petition for permanency benefits prior to the statute of limitations running, not just a motion to amend. However, there is no statutory or administrative rule requiring Claimant to file a separate petition for each type of workers’ compensation benefit she seeks from the employer arising out of the same injury. The commissioner concluded a motion to amend was the proper procedural course to take when a petition alleging the same injury for the same date against the same employer is already on file, and the Court of Appeals agrees.

The Court of Appeals also concludes substantial evidence supports the factual findings of the agency and the agency’s award of thirty percent industrial disability is not irrational, illogical, or wholly unjustifiable. The deputy commission assigned a thirty percent industrial disability after  concluding Claimant has clearly lost earning capacity as she is now restricted from overhead and heavy work activities. The deputy noted Claimant’s age and the fact that she had to give up her part-time work. The deputy also stated that the restrictions imposed would preclude Claimant from some food server and food preparation jobs that were in her prior work experience. The Court of Appeals therefore affirms the district court's judicial review decision affirming the agency's award of workers' compensation benefits.

 

ONE FLEW OVER THE PENNSYLVANIA CUCKOO’S NEST, OR DO YOU FEEL LUCKY, III?

By Kevin L. Connors, Esquire

 

 

Close your eyes.

Now imagine your dream job.

No, it is not being asked to play Jack Nicholson, or, for that matter, Nurse Ratchet, in the classically disturbing One Flew Over the Cuckoo’s Nest.

Nor, is it being Dirty Harry, never sure how many bullets are left in your gun chambers, never quite sure whether to arrest or execute.

No, it is, as it was in Murphy v. WCAB (Ace Check Cashing), being the recently-promoted General Manager of a check cashing store, responsible for Employee supervision and scheduling, managing money, and overseeing 8 regional stores.

In Murphy, decided by the Pennsylvania Commonwealth Court on February 20, 2015, the Claimant filed a Claim Petition for Pennsylvania workers’ compensation benefits, alleging that she sustained work-related injuries to her neck, shoulders, thoracic spine, wrist, and ankles, as well as claiming that she sustained post-traumatic stress disorder and depression, when she claimed that she had been physically and psychologically assaulted during the course of an armed robbery of Ace’s main offices in 2010.

She also filed a Penalty Petition, alleging that the Employer violated the Act by never issuing a compensation Notice, neither accepting or denying her workers’ compensation claim, or, alternatively, paying her temporary compensation benefits during the initial 90-day period of investigating the compensability of the claim.

Testifying that when she arrived at work, that she was accosted by an armed robber, and that the armed felon then compelled the Claimant to turn off all the alarms in the office, as the felon perfected an unlawful redistribution of wealth while pointing a gun at the Claimant’s back.

After the robber concluded his ungodly business, the Claimant was able to call 911, although she remained bound by the robber’s wicked knots.

When Police arrived, the Claimant attempted to run to her husband, who had been detained outside by a second robber, with the summoned Police drawing and pointing their guns at the Claimant, who then became hysterical, not knowing whether or not her husband was dead or alive.

After the air cleared, the Claimant and husband were reunited, and the company President was notified of the incident.

Almost immediately, the Claimant began experiencing chest pains, and was having difficulty breathing and speaking. She was ambulanced to a hospital, and a copy of the surveillance video of the robbery was admitted into evidence before the Workers’ Compensation Judge presiding over the Claimant’s Petitions.

The Claimant sought treatment with Dr. Geoffrey Temple, whose expertise is being available to treat a fairly high percentage of the injured Claimant and Plaintiff population in Southeastern Pennsylvania, with Dr. Temple referring the Claimant to Sherri Landes, Ph.D. as well as recommending that the Claimant consult a psychiatrist to secure medications to address the Claimant’s depression and anxiety, as she was complaining that she was suffering from nightmares, panic attacks, difficulty concentrating, and crying without cause daily.

During testimony before the Workers’ Compensation Judge, she testified that she was too afraid to go back to work, as she was worried that the robbers would ultimately be able to track her to her home.

In support of her Petition, the Claimant presented the deposition testimony of Dr. Temple, who testified that the Claimant had sustained spinal injuries at L5-S1, as well as post-traumatic stress disorder.

The Claimant also presented the deposition testimony of Dr. Landes, a psychologist. In Dr. Landes’ testimony, it was revealed that the Claimant’s son-in-law had been murdered 6 years earlier, during a robbery, while he was working for Ace as a Courier.

Dr. Landes testified that the Claimant was suffering from post-traumatic stress disorder, and that she was disabled from being able to work as a Manager for Ace.

The Employer also presented medical evidence, to include the deposition testimony of an IME physician who concluded that there was no correlation between the Claimant’s physical complaints and the robbery.

Oddly, the Employer did not present evidence disputing the Claimant’s alleged psychological injury, instead presenting testimony from several witnesses regarding Ace’s security measures and procedures, the Claimant’s training in those procedures, with the Employer also boldly arguing that the Claimant was actually a participant as a co-conspirator, in the robbery, that allegedly caused her injuries.

To boldly go where no defense has gone before.

Unbelievably, the Workers’ Compensation Judge found that the robbery was not “an abnormal working condition for a General Manager in a check cashing business.”

In the absence of an abnormal working condition, the Workers’ Compensation Judge concluded that the Claimant should not be compensated for her psychological or physical injuries, resulting in the Workers’ Compensation Judge denying the Claimant’s Petitions, including her Claim Petition, and her Penalty Petition.

Would you like to spend some one-on-one time with this Workers’ Compensation Judge?

Undaunted, the Claimant appealed to the Appeal Board, with the Board affirming the Judge’s Decision, holding that the Claimant’s physical injuries, for which she apparently did not seek medical treatment, were insufficient to trigger the physical/mental standard, as the cause of the Claimant’s mental injuries, were, of course, the post-traumatic stress disorder and depression diagnosed by both doctors Temple and Landes.

Twice-snubbed, the Claimant appealed to the Pennsylvania Commonwealth Court, arguing that her claim should be considered compensable under Pennsylvania’s physical/mental standard, and not under the mental/mental standard, which requires a much higher burden of proof, with the Claimant also arguing that the robbery could not be considered to be a normal working condition, even for the Manager of a check cashing store.

Reviewing relevant precedents for similar fact scenarios, including Donovan (1999), Bartholetti (2007), Gullick (1998), the Commonwealth Court, in specific reliance upon Ryan (1998), noted that to base a mental injury on a physical/mental standard requires the predicate that the compensation-seeking Claimant sustain physical injuries during the work incident from which the mental injuries are alleged to have arisen.

More importantly, the precedents relied upon by the Commonwealth Court notably rejected the argument that physical contact alone was sufficient to implicate the physical/mental standard.

For that reason, the Commonwealth Court held that the physical/mental standard was inapplicable to the Claimant’s claim, and that her alleged mental injuries could only be decided by application of Pennsylvania’s mental/mental injury standard, requiring the compensation-seeking Claimant to prove the occurrence of an abnormal working condition causing the mental/mental injury, to overcome the compensation claim involving a subjective reaction to a normal working condition.

Addressing the abnormal working condition requirement for a mental/mental injury, the Commonwealth Court, applying the Supreme Court holdings in Payes II and Pennsylvania Liquor Control Board v. WCAB (Kochanowicz), vacated the Board’s Order affirming the Judge’s denial of the Claimant’s workers’ compensation claim, ordering that the case be remanded back to the Judge, to apply the analysis articulated by the Pennsylvania Supreme Court in Payes II, which was a case that involved a State Trooper who sought workers’ compensation benefits, in the course of which he claimed that he developed post-traumatic stress disorder after he struck and killed a pedestrian, who intentionally ran in front of his patrol car, after which the State Trooper attempted to resuscitate the pedestrian, with the State Trooper’s claim initially being granted by the Workers’ Compensation Judge, then overturned by the Appeal Board, then affirmed by the Commonwealth Court, with the Supreme Court reversing the Appeal Board and Commonwealth Court, finding that the Judge’s Decision that the Trooper’s post-traumatic stress disorder was caused by a “singular, extraordinary event occurring during the work shift”, was sufficient to establish the compensability of the Trooper’s post-traumatic stress disorder, with compensation benefits being awarded, on grounds that the State Trooper’s post-traumatic stress disorder was caused by an “abnormal working condition”, involving a nexus between the pedestrian’s act of suicide, and the Trooper’s post-accident fear and stress, which arose after the State Trooper attempted to resuscitate the deceased pedestrian through mouth-to-mouth and attempted CPR; the Payes II Decision refers to the State Trooper being exposed to blood from the suicidal pedestrian, further fueling the suggestion that Payes II was not simply a mental/mental injury claim, but involved a crossover physical/mental injury claim, given the bodily fluids that the State Trooper was exposed to, in the course of attempting to resuscitate the fallen pedestrian.

Can any of this be explained in English?

And the answer is, that it makes perfect sense if you speak compensationitis, because otherwise you are dealing with a slippery slope as the wall between mental/mental and physical/mental becomes like a movie set from Inception (2010).

What are the friggin takeaways?

First, Pennsylvania Supreme Court’s controversial Decisions in Payes II and the Pennsylvania Liquor Control Board both stand for the proposition that there is no bright-line rule, given the highly subjective nature of mental/mental injury claims.

Next, without a bright-line rule, what are you supposed to do to evaluate mental/mental injury claims for compensability/denial?

Well, you could call us, as in “who you gonna call?”, always better than simply accepting this kind of claim, or, you can move your business to a jurisdiction that does not allow mental/mental injuries to be compensable, although, the truth is, that these claims are extremely rare, and, are, in fact factually very unusual, making them all the more wonderful to talk about, a point further hammered home by the no bright-line rule upon which claim facts cannot be pigeon-holed as compensable or not.

Of course, if a bright-line rule did exist, our lives would be both more normal and less interesting, and that would leave little room for the Abe Normals (Young Frankenstein) in all of us.

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.

 

We all know that before finalizing a settlement in a workers’ compensation claim, the parties need to determine whether Medicare has already made any payments and, if so, whether there is a conditional payment lien.  The obvious risk in not addressing conditional payments before resolving a case is that Medicare may come back after the settlement seeking reimbursement for conditional payments that it made while the claim was open.  If Medicare does have to seek repayment after the settlement, it can seek more than just the amount of the conditional payments.  Medicare can seek twice that amount, or double damages.[1]

Medicare is not the only entity that can come after a party to obtain reimbursement for conditional payments.  The Medicare Secondary Payer Act also includes a private cause of action which means that the injured employee can sue the carrier for failure to reimburse Medicare for conditional payments.

The private cause of action in the context of a workers’ compensation award was recently addressed in Estate of McDonald v. Indenmity Insurance Company of North America, 2014 U.S. Dist. LEXIS 121902.  In this case, the Western District of Kentucky awarded the employee’s estate the full amount of Medicare conditional payments, plus double damages, despite the carrier having already reimbursed Medicare.

By way of background, the employee was involved in a motor vehicle accident, which he alleged was work related.  The resulting workers’ compensation claim was denied.  Between the accident on May 10, 2007, and his ultimate death on November 5, 2007, Medicare paid $180,185.75 in medical bills.  On December 28, 2009, the Kentucky Workers’ Compensation Board found the accident and resulting death were work related and ordered the employer/carrier to pay medical expenses.  The final order was issued on March 9, 2010.

On September 13, 2012, the estate of the injured employee filed a lawsuit under the Medicare Secondary Payer private cause of action.  After the lawsuit was filed, the carrier received a Medicare conditional payment letter dated September 18, 2012, which was followed by the Final Demand Letter on October 25, 2012.  The carrier paid the full conditional payment amount to Medicare on December 11, 2012, and received a letter from Medicare dated January 11, 2013, acknowledging payment in full and closure of the file.  The carrier moved to dismiss the lawsuit, in part, because the conditional payment had been reimbursed per Medicare’s demand.  The court did not agree, instead relying upon the same reasoning as the 8th Circuit as follows:

The thinking behind the statute is apparently that (1) the beneficiary can be expected to be more aware than the government of whether other entities may be responsible to pay his expenses; (2) without double damages, the beneficiary might not be motivated to take arms against a recalcitrant insurer because Medicare may have already paid the expenses and the beneficiary would have nothing to gain by pursuing the primary payer; and (3) with the private right of action and the double damages, the beneficiary can pay back the government for its outlay and still have money left over to reward him for his efforts.

Estate of McDonald, 2014 U.S. Dist. LEXIS 121902, *5.  The court held that the carrier’s argument—that it had already reimbursed Medicare, so there was “no harm, no foul”— disregarded the two years between the order for payment made by the Workers’ Compensation Board and the filing of the lawsuit, during which the carrier did nothing to either notify or reimburse Medicare.  The court awarded the employee’s estate the full amount of the $184,514.24 in Medicare conditional payments, plus double damages in that amount, as a reward for the estate’s efforts.

This private cause of action is also being exercised by Medicare Advantage Plans.  Although the circuits are somewhat split, the majority are allowing such plans to initiate lawsuits seeking reimbursement for expenses paid under Medicare Part C.

Risk Handling Hints:

It is important to include language in your settlement agreement to address how conditional payments are being addressed.  But what happens if your case goes to a hearing and responsibility for payment of medical care is retroactively established?  We recommend contacting the Benefits Coordination & Recovery Center (BCRC) once a final award establishes responsibility for payment of medicals to obtain any conditional payment amount that must be reimbursed.

We also recommend beginning the process to verify any conditional payments beforereaching a final settlement or taking a case to hearing.  Although Medicare is reluctant to provide a final conditional payment amount prior to settlement, we recommend reporting the claim to Medicare, which is done through the BCRC, to establish a case identification number, which will begin the conditional payment investigation process.  At any point after the claim has been established, a party may then report the settlement, which will generate a final conditional payment letter.  We are looking forward to Medicare’s full implementation of Section 205 of the SMART Act which will allow the parties to obtain a final conditional payment amount prior to settlement.

The law is not yet settled on how much time must pass before an employee is able to file the private cause of action (although the SMART Act established a three-year statute of limitations for pursuing a claim for conditional payment reimbursement, which begins to run from the date notification of settlement or award is provided to Medicare), the amount of damages that can be recovered, and the standard for demonstrating entitlement to double damages, but it is clear that carriers and defense counsel can take steps to mitigate any potential damages.  In addition to the list above, some best practices we recommend include the following:

  • Do not rely upon any mandatory reporting under Section 111 to “trigger” a conditional payment letter. Be prepared to investigate potential conditional payments independently of Section 111 mandatory reporting requirements.
  • Do not rely upon the employee to share conditional payment information with the carrier. When in doubt, notify BCRC of your claim to begin the conditional payment investigation.
  • Specify in the settlement agreement exactly how conditional payments have been addressed, including how they will be reimbursed.
  • Verify whether a Medicare Advantage Plan has made any payments related to your claim. Negotiate resolution of any Medicare Part C lien directly with the insurance plan.
  • Upon receipt of any final award establishing responsibility for medical payments, notify BCRC of the claim and request a conditional payment letter.

[1] 42 U.S.C. § 1395y(b)(2)(B)(2).

Effective January 1, 2015, the mileage rate is $0.575.  The maximum benefit rate for accidents occurring on or after January 1, 2015, is $761.00

Desirae Cintron was injured in a motor vehicle accident on September 20, 2011 while walking in the parking lot of a Wal-Mart store where she worked.  She was struck by a vehicle driven by Marvin Thomas.  Cintron was eligible for PIP benefits because she lived with her father who had an insurance policy with NJM.  She brought a law suit against Thomas in civil court for damages.

The issue of Wal-Mart’s workers’ compensation lien arose as part of the civil suit with defendant Thomas taking the position that Wal-Mart had no lien rights because evidence of PIP benefits, which are collectible or paid under a standard PIP policy, are inadmissible in a civil action for recovery of damages. Because the plaintiff would not be able to recover her medical bills, the Defendant contended that Wal-Mart would not be able to recover its lien for the payment of these bills. Defendant argued that part of the automobile reform legislation was a provision insulating a tortfeasor or person responsible for the accident from a claim for medical expenses and wage benefits that are paid by PIP.  The way this was accomplished was through a provision in the PIP law under N.J.S.A. 39:6A-12, which bars evidence of PIP benefits which are collectible or paid under an auto insurance policy. What this does, in effect, is prevent a double recovery of PIP benefits already paid out or due to the insured in a subsequent action.

Wal-Mart intervened in this case to protect its lien. It contended that N.J.S.A. 39:6-12 did not apply to a suit involving an automobile accident in which the workers compensation carrier paid the medical bills. Because the costs of the work-related auto accident are ultimately borne by the workers comp carrier, these benefits are not “collectible or paid” through PIP coverage and are admissible. Thus, it should be entitled to assert its lien to collect on the medical bills it paid.  

Defendant relied heavily on the unreported case of Dever v. New Jersey Mfrs. Ins. Co, 2013 Wl 5730033 (App. Div. Oct. 23, 2013) for the proposition that there is no workers’ compensation lien in this situation.  Wal-Mart, which was represented by Capehart Scatchard through Gina Zippilli Esq. and Betsy Ramos, Esq., argued to the contrary  thatDever is entitled to no precedential value and that the controlling case in this area isLefkin v. Venturini, 229 N.J. Super. 1 (App. Div. 1988).  

The Honorable Darrell Fineman, J.S.C., Law Division, Cumberland County, held in favor of Wal-Mart.  “Plaintiff’s workers’ compensation lien is admissible because precedential case law controls, and there has been no indication that the statute has been changed as to workers’ compensation through the enactment of AICRA.”   The Judge said that theLefkin case is binding on the court.  The Judge reasoned that workers’ compensation is ultimately responsible for payment of medical bills in a situation where the PIP carrier makes the initial payment.  The PIP carrier has a right of reimbursement against the workers’ compensation carrier.  Therefore, evidence of the medical bills should not be barred in the civil suit because they are not collectible under the PIP policy.  The Judge concluded:

In the case where both workers’ compensation and PIP apply, the workers’ compensation system is the ultimate payer of the plaintiff’s medical bills.  Therefore, it makes little sense to apply a bar created for the PIP statutory scheme and not a part of workers’ compensation statutory scheme.

This decision, which was rendered on February 23, 2015, is now the second decision in the Superior Court in the past few months rejecting theDever case as having no precedential value and essentially being wrongly decided.  It is an important decision because there are so many employers in New Jersey who are trying to recover workers’ compensation liens where plaintiffs are defending by means of the Dever case.   For further information on this case, please contact Betsy Ramos, Esq. atbramos@capehart.com

 

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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.