State News

On February 23, 2018 the Alabama Court of Civil Appeals released its opinion inEx Parte Alabama Gas Corporation denying Alagasco’s Petition for Writ of Mandamus wherein it sought relief from a particularly restrictive HIPAA Order entered by the trial court. It is quite a common occurrence for judges in workers’ compensation cases to enter a "HIPAA Order". The purpose of such an order is to ensure compliance with the Health Insurance Portability and Accountability Act of 1996 (HIPAA), while still allowing parties to obtain protected health information relevant to the case. However, in the underlying case of Robert Smitherman v Alabama Gas Corporation, the trial court entered a HIPAA order that was a departure from the "standard" order typically entered. That order provided, among other things, that the parties and their attorneys were only allowed to obtain protected health information (namely medical records and bills) after issuing a subpoena to obtain them. It also limited the parties’ ability to obtain records pertaining to "personal injury", and prohibited any medical care provider from disclosing any protected health information other than that which directly pertained to the alleged work-related injury. The order further expressly prohibited Alagasco’s attorneys from engaging in anyex parte discussions, conferences, interviews, and/or telephonic or email communications with any of the plaintiff’s healthcare providers without first providing notice to the plaintiff’s attorney.

Alagasco filed a Motion to Amend the HIPAA order, asserting that it prohibited certain methods of discovery that are allowed in workers’ compensation cases. The trial court set Alagasco’s Motion to Amend for hearing on December 20, 2017. However, two days prior to that, Alagasco filed a Petition for Writ of Mandamus with the Alabama Court of Civil Appeals, and also filed a Motion to Stay proceedings at the trial court level, pending the Court of Appeals’ resolution of its mandamus petition. At the December 20, 2017 hearing, the trial court denied Alagasco’s Motion to Stay. However, the judge stated "I think the HIPAA Order, to some degree, is due to be amended...there may be some revision that I acknowledge needs to be made".

Alagasco argued to the Court of Appeals that the HIPAA Order prohibits any meaningful opportunity on the part of Alagasco to make timely determinations of reasonableness, necessity, and relatedness of recommended medical treatment. It also argued that the order precludes any opportunity to ensure that the plaintiff is complaint with reasonable requests to submit to medical treatment as provided in the Act. However, the Court of Appeals denied Alagasco’s petition without ruling on the merits of Alagasco’s arguments. The Court of Appeals held that Alagasco failed to demonstrate that the trial court clearly exceeded its discretion, or that Alagasco lacked another adequate remedy by appeal. Judge Terry Moore wrote a concurring opinion, stating that while he agreed that the Petition for Writ of Mandamus was due to be denied, it was primarily because the trial court had not explicitly refused to act on Alagasco’s Motion to Amend the HIPAA Order.

MY TWO CENTS

Mandamus is an "extraordinary remedy", and is only available when the trial court clearly exceeds its discretion or refuses to act when it is required to do so, and there is no other remedy available. In this case, Alagasco’s Petition for Writ may have been a little premature, since the trial judge indicated that he was considering amending the order. While the Court of Appeals declined to decide the issue on the merits, Alabama is clear how the Courtshould have decided it if the Petition for Writ had been proper. The trial court has broad, but not unfettered, discretion in discovery matters. § 25-5-81(f) of the Alabama Workers’ Compensation Act provides that the same discovery rules apply to workers’ compensation cases as apply to other civil cases, with a few minor limitations aimed at reducing costs. The Supreme Court has previously held that a defendant has a right to contact, and even haveex parte communications with, a plaintiff’s treating physicians. See, Romine v. Medicenters of America, Inc.,476 So. 2d 51 (Ala. 1985). In Romine, the Court held that "No party to litigation has anything resembling a proprietary right to any witness's evidence...Unless impeded by privilege, an adversary may inquire, in advance of trial, by any lawful manner to learn what any witness knows if other appropriate conditions the witness alone may impose are satisfied...". Id. The Supreme Court has also held that a case manager has the right to contact a medical provider by telephone to obtain reasonably necessary information, allowing the employer to fulfill its statutory obligation to provide and oversee the employee’s medical care.Ex Parte Smitherman Bros. Trucking Inc., 751 So. 2d 1232 (Ala. 1999).

ABOUT THE AUTHOR

This article was written by Charley M. Drummond, Esq. of Fish Nelson & Holden, LLC. Fish Nelson & Holden is a law firm located in Birmingham, Alabama dedicated to representing employers, self-insured employers, and insurance carriers in workers’ compensation cases and related liability matters. Drummond and his firm are members of The National Workers’ Compensation Defense Network (NWCDN). The NWCDN is a national and Canadian network of reputable law firms organized to provide employers and insurers access to the highest quality representation in workers’ compensation and related employer liability fields. If you have questions about this article or Alabama workers’ compensation issues in general, please feel free to contact the author at cdrummond@fishnelson.com or (205) 332-3414.

Written by: Brad Inman

Two long-time Deputy Commissioners have recently been nominated by Governor Roy Cooper for appointment to the Full Commission.   Deputy Commissioners Robert J. Harris and Myra L. Griffin have both served in their current roles since 2005, adjudicating cases and conducting full evidentiary hearings around the state.   Their appointments are pending confirmation by the North Carolina General Assembly, so Deputy Commissioners Harris and Griffin will continue to hear cases as Deputy Commissioners until the confirmation process is complete and each has been sworn in.  In addition to policy-setting, the six Full Commissioners sit in panels of three to represent the Commission’s appellate level, hearing claims appealed from Deputy Commissioner decisions. 

The other big news at the Commission is the expected final approval of new rules surrounding the use and prescription of opioids, related medications, and pain management treatment.   The rule-making process is nearing completion, with the stated goals of ensuring that injured workers are provided the services and care intended by the Workers’ Compensation Act and medical costs are adequately contained.  Much more about the specific provisions will be addressed in future blog posts when the rules become official, but the proposed rules will hold medical providers to strict standards and documentation requirements when it comes to prescribing controlled substances.  Certain drugs, such as fentanyl, will be prohibited from prescription during the first twelve weeks of treatment and mechanisms will be put into place to ensure that the lowest effective dosage of narcotic medication is utilized.  Again, the specific rules will be analyzed here when they become effective, which is expected by May 2018.

We are always available for consultation regarding the impact of the Commission appointments, how the current make-up of the Commission affects claim handling, and strategies for utilizing the anticipated opioid rules for maximum claim impact and cost containment. 

I have written many times about the fact that success for employers in workers’ compensation most often comes down to past medical history and causation analysis.  This is particularly true in a state like New Jersey where there is virtually no formal discovery allowed.  Employers need to know in a back claim, for example, whether the injured worker has an extensive prior history of chiropractic treatment or car accidents. But what about the importance of reviewing treating notes of various doctors and therapists after the work accident? This is an underrated concept and deserves some consideration.

This practitioner had a case recently where the employee injured her knee at work and was diagnosed with a partial tear requiring no significant treatment.  Conservative care ensued and the recovery seemed excellent.  Then six months went by and the injured worker suddenly returned back to the authorized doctor stating that her knee had become much more painful.  The treating doctor noted the significant worsening in the knee and mentioned that petitioner had seen her family doctor recently.  The IME doctors put fairly high estimates on the knee, leading to a potential award of 20% of the leg with the potential for knee surgery on a reopener.

Our office sent a subpoena for the family doctor’s records with particular interest on the visit in the summer noted in the treating doctor’s report.  That entry in the family doctor records stated, “Patient was doing some challenging rock climbing over the weekend and jumped from a height landing on her knee, causing intense pain and swelling.”  That was the only reference to this new incident, and obviously this constituted a significant event. It accounted for the sudden visit to the treating doctor after six months of no treatment.  This information changed the course of the case.  It allowed respondent to avoid a significant order approving settlement with reopener rights.  Instead the case settled for a nominal Section 20.  But for the subsequent family doctor records, this employer would have paid ten times as much money, bought a likely reopener, and eventually a likely knee surgery with a higher award.

Defense counsel, adjusters and employers must scrutinize subsequent treatment records, PT notes, and tools like ISO reports.  When an employee like the claimant above reinjures her knee, that new incident amounts to the same thing as a work accident – except it is a non-work event that breaks the chain of causation.  If someone falls in a grocery store while shopping and reinjured his shoulder before the case is settled, that subsequent accident may be perhaps of equal significance to the original fall at work that injured the shoulder.  The same is true of subsequent car accidents that cause significant treatment, new MRIs, and injections in a person who has already had a work-related back injury.

Subsequent non-work accidents are pivotal in many workers’ compensation case. These accidents often relieve the employer of paying an expensive order approving settlement with reopener rights. The reason is simple: injured workers receive permanent disability benefits for their “current complaints” at the time of settlement.  The current complaints incorporate the complaints from the subsequent non-work accident.  Employees are not entitled to receive permanency awards for their condition before the subsequent non-work event.  Think about it:  if a non-work accident has objectively worsened the medical condition originally injured in the work accident, it is impossible to distinguish the effects of the medical condition before the subsequent non-work injury from the effects after the subsequent injury.  The employee might have healed if it were not for the subsequent non-work injury.  The testimony at settlement regarding present complaints will by definition be closer in time to the events of the non-work accident.  For the petitioner to prove that the present complaints are unaffected by the subsequent accident is impossible if the non-work subsequent accident worsened the medical conditions from the work accident.  It would be like putting additional ingredients in a basic smoothie, drinking the smoothie for the first time, and then trying to describe what the drink would have tasted like before the ingredients were added.

Practitioners should read PT notes religiously.  They often contain amazingly important nuggets of information about non-work activities.  Most physical and occupational therapists are prolific note takers.  They know how important it is to get the interim medical history, and they write it down.  How many times have counsel read PT notes and discovered that the injured worker is complaining of a new injury playing sports over the weekend?  That new injury may explain a sudden change in condition and break the chain of causation.  It may lead to a Section 20 that otherwise would not have occurred.  Nor should the practitioner assume that the IME doctor is going to read the treating notes thus relieving the obligation of defense counsel and adjusters to read them.

Just as prior family doctor and chiropractic records often hold the key to the defense of a workers’ compensation case, so too subsequent treating notes may dramatically lower the defense exposure and lead to enormous savings for employers.

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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.

The Texas Third Court of Appeals issued its opinion in the lead Texas air ambulance case on January 31, 2018.PHI Air Medical, LLC v. Texas Mutual Insurance Company, Hartford Underwriters Insurance Company, TASB Risk Management Fund, Transportation Insurance Company, Truck Insurance Exchange, Twin City Fire Insurance Company, Valley Forge Insurance Company, et al., No. 03-17-00081-CV, (Tex. App.—Austin Jan. 31, 2018, no pet. h.).

The court of appeals’ opinion reverses the trial court’s judgment in favor of the carriers and remands the case to the trial court for further proceedings.  The court of appeals held that the federal Airline Deregulation Act (ADA) preempts Texas’ workers’ compensation laws that regulate reimbursement to air ambulance carriers.  The court also held that the McCarran-Ferguson Act (MFA) does not prevent ADA preemption in this case.  Whether the MFA applies to prevent inadvertent federal preemption depends on whether the state laws regulate the “business of insurance.”  The court held that the Texas statutes that direct workers’ compensation carriers how much to reimburse health care providers do not regulate the “business of insurance,” although the basis for that decision is not entirely clear.           

The U.S. Supreme Court has held that state laws that prescribe the terms of the insurance policy directly regulate the “business of insurance.”  The carriers argued that Texas’ workers’ compensation laws do precisely that in this case.  The terms of the workers’ compensation policy are literally the Workers’ Compensation Act and Division rules.  Workers’ compensation carriers are required to use a standard policy written by the Texas Department of Insurance which provides that carriers must pay the benefits required by the workers’ compensation law.  The policy itself is only two pages long because it incorporates Texas’ workers’ compensation laws.  Thus, the state actually writes the terms of the workers’ compensation policy which the U.S. Supreme Court has recognized falls squarely within the business of insurance.     

The court of appeals’ opinion leaves numerous unanswered questions including the Division’s authority to decide air ambulance fee disputes if it can’t apply its fee guidelines to determine reimbursement; the standards to be applied to determine reimbursement in the absence of the Division’s fee guidelines; and whether the carriers have any obligation to pay more than the amount provided by the Division’s fee guidelines since that is all they are contractually obligated to pay under their policies.

The insurance carriers will likely file a motion for rehearing with the court and if necessary, a petition for review in the Texas Supreme Court.  The federal preemption issue is also pending in federal district court in Austin in the case of Air Evac EMS, Inc. v. State of Texas, Ex Rel. Department of Insurance, Division of Workers' Compensation et al.  Briefing in that case is currently scheduled to end May 7, 2018.

-James Loughlin, Stone Loughlin & Swanson, LLP.

Arlington physician Arnold J. Morris, M.D. has failed – again – in his effort to enjoin the Texas Medical Board from attempting to discipline him for allegedly over-prescribing medications. The United States Court of Appeals for the Fifth Circuit has affirmed the district court’s dismissal of Dr. Morris’ lawsuit against the Board. The decision would appear to clear the way for the Board to resume its disciplinary action against him.

In his request for an injunction to stop the Board proceeding, Dr. Morris had enlisted the help of State Representative William Zedler, District 96 (R-Arlington). According to the report of the U. S. magistrate judge, at a hearing on his motion for a preliminary injunction Dr. Morris called Representative Zedler as a witness to support his claim that the complaint against him was “ginned up.”  That testimony reportedly revealed that Representative Zedler had called and emailed the Board president about the Board’s investigation of Dr. Morris. 

Apparently this is not the first time that Representative Zedler has intervened on behalf of doctors who were investigated by the Board. According to the “Ethics Explorer” section of theTexas Tribune, Representative Zedler previously has requested confidential records from the Board in order to assist doctors who were being investigated and at least two of the doctors, who were not his constituents, had contributed to his campaign.

- David Swanson, Stone Loughlin & Swanson, LLP.

March 1, 2018  is the deadline by which insurance carriers must begin using the new and improved versions of Plain Language Notices (PLNs). The Division of Workers’ Compensation revised the notices in September 2017. Use of the revised forms was optional prior to March 1 but now is mandatory and use of the old forms is a potential administrative violation.

Ever seen an administrative violation from the Division of Workers’ Compensation and wondered how in the world it came up with the amount of the penalty? So have we. But that may be about to change. The Division is in the early stages of drafting amendments to rules that will require a change to its procedure for assessing such penalties. The amendments to Rule 180.8 and 180.26 will, among other things, require the Division to explain the factors it considered in determining the amount of the penalty. 

The amendments are in response to changes to Labor Code §415.021 that became effective September 1, 2017. Those legislative changes apparently were prompted by concerns from system participants that the Division’s determination of penalty amounts was arbitrary.  

The Division has posted informal working drafts of the amendments on its website. It is seeking comment on the drafts through March 7, 2018. You may send an email to InformalRuleComments@tdi.texas.gov to comment on the drafts.

- David Swanson, Stone Loughlin & Swanson, LLP.

Telemedicine is catching on. The Division of Workers’ Compensation is accepting public comment on a proposed rule that would expand its use in the workers’ compensation system. 

Broadly defined, telemedicine is a doctor’s use of a video system to examine a patient in a different location. It is already permitted in the Texas workers’ compensation system to some degree. Currently, however, it is limited to “underserved” areas – typically rural regions with insufficient access to health care providers. Proposed Rule 133.30 would eliminate this restriction and allow the use of telemedicine anywhere in Texas. 

The potential effects of this change are significant. For example, suppose – just suppose – that there was a chiropractor in Dallas to whom Claimant attorneys routinely referred their clients because the chiropractor was perceived to be Claimant-friendly, liberally prescribing treatment and doling out off-work slips. Would this proposed rule tempt Claimant attorneys in other cities to refer their clients to this chiropractor as well? Would the chiropractor in Dallas become the treating doctor for workers living in Waco, Tyler, and Abilene as a result? Only time will tell.

Proposed Rule 133.30 is scheduled to be published on the Division website by March 2, 2018. The Division will be accepting comments on the proposed rule through April 2, 2018. You may comment on the rule by sending an email toRulecomments@tdi.texas.gov.

-David Swanson, Stone Loughlin & Swanson, LLP.

A Houston couple has been indicted by  the Department of Justice, which  alleges  that the pair fraudulently billed the  federal government millions of dollars  for compound cream medications for injured workers.   
 
George and Marene Tompkins ran Piney Point Pharmacy on Fondren Road in Houston. They have been charged with conspiring to obtain illegitimate prescriptions for compound creams for which they billed the Department of Labor under the Federal Employee Compensation Act  (FECA), which is the federal workers’ compensation program. The couple allegedly billed the federal government over $23 million for those compound creams from 2009 to 2016. 

On February 21, George and Marene  appeared before a U.S. magistrate judge and entered pleas of not guilty. If convicted of the charges against them they reportedly face up to 20 years in federal prison. 

Piney Point Pharmacy specialized in compounding. George referred to himself as the “Compound King” on the pharmacy’s website and the pharmacy’s tagline was “Special Meds for Your Special Needs.”

- David Swanson, Stone Loughlin & Swanson, LLP.

The Associate Attorneys at Cousineau, Waldhauser, & Kieselbach have prepared case summaries of all WCCA decisions issued between October 2017 and January 2018. Please click the link below to view the summaries or see the "Resources" section of the CWK website.

http://cwk-law.com/workers-compensation-court-appeals-wcca-summaries-october-2017-thru-january-2018/

The summaries were prepared by attorneys Parker Olson, Scott Ferriss, Bryan Wachter, and Megan Oliver.

 In our effort to provide you with key up to date information on Minnesota Workers’ Compensation law and cases, we hope that you will find this to be helpful. Contact shareholder Thomas P. Kieselbach with your feedback and requests.