NWCDN Members regularly post articles and summary judgements in workers’ compensations law in your state.
Select a state from the dropdown menu below to scroll through the state specific archives for updates and opinions on various workers’ compensation laws in your state.
Contact information for NWCDN members is also located on the state specific links in the event you have additional questions or your company is seeking a workers’ compensation lawyer in your state.
Written by: Lindsay Underwood
The most recent case to analyze futility has been issued by the North Carolina Court of Appeals. The case, Monroe v. MV Transportation, relies heavily on the Griffin v. Absolute Fire Control, Inc. case that came down last year to support its findings.
In Monroe, the claimant was in her late 40’s when she sustained her injury. She had a bachelor’s degree, but was working part time as a bus dispatcher and driver for the employer, earning $10.50 per hour. She had been receiving SSD benefits since 1994 for an unrelated medical condition (PTSD). On the date of injury, the claimant slipped while inspecting a bus, hit her left shin, and twisted her back and right knee. On November 7, 2016, she received restrictions of alternating between sitting and standing, and no lifting over 20 pounds.
The claimant’s claim was denied initially but was ultimately heard before Deputy Commissioner Lori A. Gaines and the claim was determined to be compensable. The claimant’s disability was also an issue for hearing, and the claimant introduced medical records that showed her work status as “unable to work secondary to dysfunction.” Her medical providers testified they would have recommended work restrictions. Deputy Commissioner Gaines found that the claimant was disabled from November 7 through November 14, 2016, when she was written out of work. Further, Deputy Commissioner Gaines held that the claimant had been disabled thereafter until she returned to work. The Full Commission disagreed. It was noted that the claimant was 51 years old, was a part-time dispatcher and bus driver earning $10.50 per hour and had been receiving SSD since 1994. The Full Commission found that the claimant had not produced sufficient evidence to demonstrate a post-injury job search, or that looking for employment would be futile. Thus, because she had not looked for work, she was not disabled and could not meet her burden.
The claimant appealed to the Court of Appeals and argued futility. Under Russell, a plaintiff can meet her burden of proving disability by showing she is capable of some work, but it would be futile to look for other work because of pre-existing conditions like age, unrelated conditions, or lack of education. In this case, The claimant argued that the Commission’s findings of fact were insufficient to support the conclusion that she failed to provide any evidence of futility. Specifically, she argued the record contained ample evidence of futility considering her restrictions and other factors unrelated to the injury. The Court in this case cited Griffin. In that case, the claimant was 49 years old with a ninth-grade education, prior work experience limited to construction, and permanent restrictions of no lifting greater than 20 pounds as a result of the work injury. The Court in Griffin found that the Commission’s conclusion that there was “no evidence” to support futility misapplied the law and they reversed for additional findings as to whether the claimant demonstrated futility since the only factual findings in the record were consistent with a conclusion of futility.
The Court felt this case is analogous to Griffin. The claimant was in her 50s at the time of the hearing, had been receiving SSD benefits unrelated to the work injury for several decades, and despite her bachelor’s degree, was working a part-time transportation job earning $10.50 per hour, and was restricted to no lifting over 20 pounds. The Commission still concluded the claimant had not otherwise presented evidence to establish disability and made no findings regarding the claimant’s medical records labeling her work status as “unable to work secondary to dysfunction.” The Court was essentially unable to reconcile the Commission’s findings “or lack thereof” to its conclusion that the claimant failed to present any evidence showing futility.
This case was ultimately vacated and remanded to the Full Commission for additional findings as to whether, under Russell, the evidence the claimant presented is sufficient to establish disability by futility. This case is yet another reminder of how the Court will treat disability arguments regarding futility. Based on this decision, as well as Griffin, it is a good idea for defendants to have labor market surveys, or other vocational assessments completed to support their defense that a claimant is not disabled as alleged. It is also important to note that this case does not eliminate other “futility” factors that need to be present like age, education level, and work experience, to demonstrate that returning to work is futile.
If you have questions about disability arguments regarding futility, reach out to Lindsay Underwood or another member of our Workers’ Compensation team.
By: Michael Mazzoni (Associate Attorney - Fresno)
The Centers for Medicare and Medicaid Services (CMS) has released an updated Workers’ Compensation Medicare Set-Aside (WCMSA) Reference Guide (Version 3.5, January 10, 2022), and has explicitly targeted [in Section 4.3 of the memo] the usage of non-submit, non-CMS approved Medicare Set Aside [MSA] products which have gained popularity in recent years. Practitioners have utilized these MSA products to provide for allocation for future medical expenses in workers' compensation settlements. However, the new memo causes pause for many, who now fear that CMS may view these allocations as “potentially” improperly shifting the claimant’s future medical treatment to Medicare in contravention of 42 C.F.R. 411.46.
Section 4.3 states as follows:
"A number of industry products exist with the intent of indemnifying insurance carriers and CMS beneficiaries against future recovery for conditional payments made by CMS for settled injuries. Although not inclusive of all products covered under this section, these products are most commonly termed “evidence-based” or “non-submit.” 42 C.F.R. 411.46 specifically allows CMS to deny payment for treatment of work-related conditions if a settlement does not adequately protect the Medicare program’s interest.
Unless a proposed amount is submitted, reviewed, and approved using the process described in this reference guide prior to settlement, CMS cannot be certain that the Medicare program’s interests are adequately protected. As such, CMS treats the use of non-CMS-approved products as a potential attempt to shift financial burden by improperly giving reasonable recognition to both medical expenses and income replacement.
As a matter of policy and practice, CMS will deny payment for medical services related to the WC injuries or illness requiring attestation of appropriate exhaustion equal to the total settlement less procurement costs before CMS will resume primary payment obligation for settled injuries or illnesses. This will result in the claimant needing to demonstrate complete exhaustion of the net settlement amount, rather than a CMS-approved WCMSA amount."
While the wording of Section 4.3 does not prohibit or ban the use of non-submit or evidenced based allocations, it appears that CMS is aggressively placing the industry on notice by stating that “as a matter of policy and practice” a claimant will need to show that the entire settlement is exhausted, minus procurement costs, before CMS will pay for claim related treatment if the settlement does not include a CMS-approved WCMSA. Therefore, it is clear that the memo is designed to discourage usage of these non-submit MSA's.
However, there are instances where non-submit MSA's may be necessary, depending on the facts of the case, including lack of recent medical treatment, threshold issues, etc. This means that some claims are ineligible to obtain a CMS-approved WCMSA amount and nothing in Section 4.3 (or any other section in the revised WCMSA reference guide 3.5) addresses that particular issue.
The practitioner should still be free to consider the non-submit option if that works. However, they should be aware that CMS has the non-submit MSA in their crosshairs, and must work with their clients and vendors in crafting detailed and creative settlements which make sure a full accounting is done on the allocated MSA treatment when spent, and that the parties are showing that Medicare's interests are adequately being taken into consideration.
Legal Update by Attorney Alison Stewart and Law Clerk Jordan Gehlhaar
The
Iowa Court of Appeals and the Workers’ Compensation Commissioner
recently ruled on several important workers’ compensation topics:
Compensation when Shoulder Injury is Combined with another Scheduled Member Injury
Commissioner Joseph Cortese affirmed a finding that a shoulder injury combined with an injury to another scheduled member is to be compensated industrially under “catch all” provision 85.34(2)(v). In his analysis, the Commissioner provided: “while the legislature made the shoulder a scheduled member, it did not add the shoulder to the list of scheduled members that can be compensated on a 500-week basis when two are injured in a single accident.” Additionally, this conclusion was found to be consistent with prior agency determinations and avoidance absurd results. See Carmer v. Nordstrom, Inc., File No. 1656062.01 (Appeal Dec. Dec. 21, 2021).
Sufficiency of Employee Notice
The main issue in Taylor v. Iowa State University Extension was whether the employee gave sufficient 90 day notice as required by Iowa Code 85.23. The claimant was injured in a vehicle accident on the way back to the office from a work presentation. The following day, when the supervisor inquired about her whereabouts, the claimant replied via email that she had a “vehicle problem” and was out seeking medical attention. The Iowa Court of Appeals affirmed denial of benefits, finding the email insufficient notice, as it did not notify the employer that the accident was work-related.
Reasonable Delay in Obtaining Impairment Rating
The Iowa Court of Appeals held that when a claimant challenges the authorized physicians’ opinion that the claimant has reached maximum medical improvement (MMI), this affords the employer a reasonable basis to defer seeking an impairment rating. The employer was reasonable to assume that if the employee was challenging the MMI determination, they were also challenging the entitlement to permanent partial disability benefits. Under this reasoning, the employer has a basis to defer seeking an impairment rating without facing penalty benefits. See Cochran v. Quest Liner, Inc., 2022 WL 122358 (Iowa Ct. App. Jan. 12, 2022).
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On February 1, 2022, the North Carolina Full Commission released a decision in the second extended benefits case since the Reform in 2011. The case was originally heard by Deputy Commissioner Robert Harris, who found that the claimant had proven by the preponderance of the evidence that she “sustained a total loss of wage-earning capacity” because of her compensable long-term ankle condition. The underlying facts are as follows: claimant, a 53-year-old healthcare technician, sustained an injury to her ankle while trying to restrain a combative patient. Her injury required multiple surgeries. Claimant was a high school graduate with CNA qualifications, was involved in several volunteer activities, including Girl Scouts and the PTA, cut her own grass, and did crafts, including making flowerpots out of old car tires. Claimant’s authorized treating orthopedic physician gave claimant sedentary work restrictions; however, claimant’s pain management physician, Dr. Elizabeth Bagsby, testified claimant would need a sedentary job that could accommodate elevating her leg above her heart and repositioning herself throughout the day.
Claimant’s vocational expert testified that claimant’s past employment history and education, as well as her sedentary work restrictions and need to elevate her leg throughout the workday, prevented her from being employable. Defendant’s vocational expert testified that claimant was employable and felt her need to elevate her foot could be accommodated in a sedentary position. The expert also identified several positions in the medical field that were sedentary in nature, which she believed claimant could perform. The Deputy Commissioner noted in his Opinion and Award that the Defendant’s vocational expert did not meet or speak with the claimant, nor contact any of the identified employers to discuss claimant’s ability to perform the jobs.
The Full Commission panel, consisting of Wanda Blanche Taylor, James Gillen, and Adrian Phillips, gave greater weight to the testimony of claimant’s long-time treating physician rather than the pain management physician as it relates to claimant’s work restrictions. The Full Commission noted that Dr. Thompson, the authorized treating physician, at no time opined that claimant needed to elevate her leg above her heart. Additionally, the Full Commission noted there was no expert testimony or opinion that claimant was incapable of performing work. Furthermore, the Full Commission gave greater weight to the Defendant’s vocational expert as her testimony was consistent with the medical evidence indicating claimant had the ability to perform sedentary work and was more consistent with claimant’s demonstrated ability to perform valuable services, including organization, scheduling, supervision, and her reliability in her continued volunteer work. The Full Commission noted that claimant was a likely candidate to perform flexible work from home or part-time work. The Full Commission went on to note that at oral argument, claimant’s counsel conceded that she could perform one to two hours of work a week for wages.
The Full Commission concluded that the extended benefits statute in N.C.G.S. § 97-29(c) does not invoke “disability” as defined in N.C.G.S. § 97-2(9), nor does it require the employee to prove that she is unable to obtain competitive employment. The Full Commission noted that the statute on its face requires the employee to prove “by a preponderance of the evidence that the employee has sustained a total loss of wage-earning capacity.” The Full Commission interpreted this statutory language by using the plain, ordinary, and literal meaning of the words contained in the statute. The Full Commission cited the Webster Dictionary which defined “total” as “complete;” “utter” and “loss” as “to bring to ruin or destruction;” and “capacity” as “ability.” The Full Commission concluded using these definitions that claimant must prove by a preponderance of the evidence that she sustained a complete destruction of the ability to earn wages [emphasis added]. The Full Commission noted claimant’s ability to perform sedentary work in her volunteer activities, and claimant’s claim for extended benefits beyond the 500 weeks was denied.
This case is an excellent indication of how difficult it should be for claimants to prove they are entitled to extended benefits beyond the 500-week cap. If the injured employee has any ability to earn wages, albeit small, defendants should prevail assuming all the Commissioners follow the standard articulated above. No doubt this case is probably heading to the North Carolina Court of Appeals, and we will keep you updated on its potential path through our Appellate Courts.
In the meantime, some practical takeaways when defending these extended benefit cases include:
Income Benefits
O’Bryan v. Zip Express, (2020-SC-02620WC, not final) – The Supreme Court of Kentucky
Claimant was found by the ALJ to be permanently and totally disabled following a work-related motor vehicle accident. Claimant was 65 on the date of accident. Claimant appealed the award, arguing the age 70 cap on indemnity benefits under KRS 342.730(4) is an unconstitutional violation of equal protection.
The Court of Appeals found KRS 342.730(4) and the age 70 cap is constitutional both on its face and as retroactively applied (applies to all cases not fully and finally adjudicated as of the effective date of the act, 7/14/2018). The Supreme Court affirmed, consistent with its opinion in Kroger v. Cates, 627 S.W.3d 864 (Ky. 2021).
Employee v. Independent Contractor
AIG v. Oufafa, et. al., (2020-CA-0942-WC, not final); Taxi, LLC d/b/a Taxi 7 v. Oufafa, et. al., (2020-CA-0946-WC, not final) – Kentucky Court of Appeals
Taxi 7’s business is leasing taxicabs and related services, including dispatch and credit card processing to individuals, corporations, partnerships and other entities. Claimant signed a Lease agreement with Taxi 7 agreeing to pay $405 weekly for a cab lease, dispatch services, and credit card processing services, as well as $30 weekly for vehicle insurance. He also signed a paper titled “Status as a Self-Employed Businessperson,” in which he clearly acknowledged he was not an employee and not entitled to workers’ compensation benefits. Claimant could operate the cab as he saw fit, choose his hours, charge his own rates, and keep his collected fares.
Claimant filed for worker’s compensation benefits after being shot while driving. ALJ found Claimant was an independent contractor and Taxi 7 was a taxicab leasing company. While the ALJ did find that cab driving was an integral part of Taxi 7’s business of leasing cabs, the ALJ concluded that driving passengers was a distinct occupation different than the leasing of cabs.
The appellate Board reversed, finding that the ALJ incorrectly concluded that Taxi 7 was a taxicab leasing company rather than a taxicab company that employed the Claimant as a driver. The Court of Appeals reversed the Board, stating that the ALJ’s finding of fact that Taxi 7 was a taxicab leasing business and Claimant was not an employee was supported by the facts and not clearly erroneous. The Court emphasized Claimant received no remuneration from Taxi 7 and his earnings all came directly from his customers.
Should you have any questions or wish to discuss any related matters, please contact us at your convenience.
H. Douglas Jones, Esq. – djones@jsbattorneys.com, 859.594.4200
Margo Menefee, Esq. – mmenefee@jsbattorneys.com, 859.594.4200
Fun Fact: No where in any of the DWC materials is there a provision for a designated doctor to seek reimbursement for a no-show appointment. If you are seeing bills for claimant’s failing to attend a DD examination – you should not be!
