The NWCDN has a lengthy history of sponsoring cutting-edge seminars addressing incisive topics that are timely to the business of Workers’ Compensation.  The NWCDN will continue this tradition on April 28, 2022 in Philadelphia at the Hilton at Penns Landing.  The theme of the conference is “Philadelphia Freedom.” The speakers will address complex issues that face the industry today with an eye toward the developments of tomorrow.  

This one day seminar moderated by Lora Northen of Capehart Scatchard and John Ellis of Heckler & Frabizzio features an exciting array of Industry leaders.  Bruce Hamilton, the President of the NWCDN, will get things started with a few opening remarks followed by Caryl Russo, Ph.D.-Senior Vice President at RWJBarnabas Health who will discuss the anatomy of a national award winning workers’ compensation program. Robert Wilson-President & CEO of WorkersCompensation.com will then offer his unique perspective on recent trends in the workers’ compensation industry as well as what he sees on the horizon.   The morning will be rounded out with a session by Max Koonce – Chief Claims Officer at Sedgwick who will discuss the evolution of the workers’ compensation system as well as its future.

The afternoon session will kick off with Sarah Sherman the Assistant General Counsel for Maxim Healthcare Staffing Services and Bert Randle of Franklin & Prokopik discussing lessons they have learned in managing professional relationships.  Kenneth Kutner, PhD, ABPP-CN a Clinical Assistant Professor of Neuropsychology  at Weill Cornell Medicine- Cornell University and the lead author of the Sideline Concussion Checklist with then draw from his 28 years of experience as the team neuropsychologist for the New York Giants to provide all attendees with the opportunity to learn from a true “giant” in the industry on how to approach head injury claims.  The final panel will feature Lisa Thompson the Workers’ Compensation Claims Manager at Campbell’s and William Abate the Corporate Risk and Safety Manager at Holman Enterprises and be moderated by Lora Northen.  This panel of industry experts will discuss the “dos and don’ts of handling claims” and even reveal some of their secrets to crafting a successful workers’ compensation program.  I hope to see you in Philadelphia this April.  

Nicholas A. Dibble, Esq.

Capehart Scatchard

By Nicole Graci of Hamberger & Weiss LLP (NY) and Daniel Hayes of Teague Campbell Dennis & Gorham LLP (NC)

The NWCDN has re-established its Medicare Compliance Committee, and what great timing! On January 10, 2022, the Centers for Medicare and Medicaid Services (CMS) updated the Workers’ Compensation Medicare Set-Aside Arrangement (WCMSA) Reference Guide, which it does periodically, but this update sent shockwaves throughout the Medicare compliance community. As our first act as a committee, we offer the following analysis of what has become known as “The 4.3 Update.”

CMS’ 1/11/22 update to Section 4.3 of the WCMSA Reference Guide is a strong message about CMS’ view of evidence based or non-submit WCMSA products. On March 15, 2022, CMS updated the Reference Guide again, to clarify that message.

CMS expressed its concern that products commonly called “evidence-based” or “non-submit” MSAs are not adequately protecting Medicare’s interests.  Here is the full text of the 1/10/22 update,

4.3 The Use of Non-CMS-Approved Products to Address Future Medical Care

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.

There has been an increase in the use of evidence based or non-submit WCMSA products in the last few years. Under the theory that CMS’ method for calculating a WCMSA results in inflated medical and prescription expense, resulting in higher settlement costs, evidence based or non-submit MSAs are calculated using alternative methods, resulting in reduced treatment and medication over a claimant’s lifetime and less expense. These products are often accompanied by “guarantees,” offers of post-settlement professional administration of MSA funds, structured WCMSAs and, in some cases, reversionary interests. In response to the 1/11/22 update, the purveyors of evidence based or non-submit MSA products immediately published analyses, arguing that CMS was contradicting the well-established legal reality that CMS pre-settlement approval of a WCMSA is voluntary. Detailed arguments were presented, outlining how CMS was overreaching its authority. CMS responded with the subsequent update on March 15, 2022.

However, a close reading of the January and March updates and review of the Medicare Secondary Payer statute and accompanying federal regulations reveals that the updates are consistent with CMS’ long standing policy that CMS pre-settlement approval, although not required by law, has been and continues to be recommended. The March 15, 2022 update softened the language of the January update, notably changing “will deny” to “may at its sole discretion deny” in reference to post-settlement payment of Medicare covered, causally related services. In addition, the beneficiary/claimant’s burden to attest to proper expenditure of the MSA funds is clarified to include a showing that, “both the initial funding of the MSA was sufficient, and utilization of MSA funds was appropriate.” CMS also clarified that its policy applies to notifications of settlements using evidence based or non-submit MSAs from 1/11/22 forward, but that it is flagging pre-1/11/22 notifications as well. CMS went on to reiterate the legal requirement of the Medicare Secondary Payer statute, regulations, and CMS memorandum that primary payers are obligated to consider Medicare’s interests at settlement, while recognizing that all settlements do not meet the CMS work review thresholds for pre-settlement approval of a WCMSA. It is well known that the CMS work review thresholds are internal and are not safe harbors. 

The full text of the March 15, 2022 update is below, with changes highlighted,  

4.3 The Use of Non-CMS-Approved Products to Address Future Medical Care

A number of industry products exist for the purpose of complying with the Medicare Secondary Payer regulations without participation in the voluntary WCMSA review process set forth in this reference guide. 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 may at its sole discretion deny payment for medical services related to the WC injuries or illness, requiring attestation of appropriate exhaustion equal to the total settlement as defined in Section 10.5.3 of this reference guide, less procurement costs and paid conditional payments, before CMS will resume primary payment obligation for settled injuries or illnesses, unless it is shown, at the time of exhaustion of the MSA funds, that both the initial funding of the MSA was sufficient, and utilization of MSA funds was appropriate. This will result in the claimant needing to demonstrate complete exhaustion of the net settlement amount, rather than a CMS-approved WCMSA amount. Notes: This official policy shall apply to all notifications of settlement that include the use of a non-CMS-approved product received on, or after, January 11, 2022; however, flags in the Common Working File for notifications received prior to that date will be set to ensure Medicare does not make payment during the spend-down period. CMS does not intend for this policy to affect any settlement that would not otherwise meet review thresholds. This comment does not relieve the settling parties of an obligation to consider Medicare’s interests as part of the settlement; however, CMS does not expect notification or submission where thresholds are not met.

CMS did not change its prior WCMSA Reference Guide language, making it clear that the submission process is completely voluntary, as follows:

There are no statutory or regulatory provisions requiring that you submit a WCMSA amount proposal to CMS for review. If you choose to use CMS’ WCMSA review process, the Agency requests that you comply with CMS’ established policies and procedures.

WCMSA Reference Guide., pp. 1, 9 (emphasis original).  Of note, this italicized language is found twice in the Reference Guide. 

The Medicare Secondary Payer statute and accompanying regulations have always afforded CMS the authority to deny payment for work-related treatment if a settlement does not adequately protect Medicare’s interests.  See 42 C.F.R. 411.46, emphasis added:

§ 411.46 Lump-sum payments.

(a)           Lump-sum commutation of future benefits. If a lump-sum compensation award stipulates that the amount paid is intended to compensate the individual for all future medical expenses required because of the work-related injury or disease, Medicare payments for such services are excluded until medical expenses related to the injury or disease equal the amount of the lump-sum payment.

(b)          Lump-sum compromise settlement.

(1)          A lump-sum compromise settlement is deemed to be a workers' compensation payment for Medicare purposes, even if the settlement agreement stipulates that there is no liability under the workers' compensation law or plan.

(2)          If a settlement appears to represent an attempt to shift to Medicare the responsibility for payment of medical expenses for the treatment of a work-related condition, the settlement will not be recognized. For example, if the parties to a settlement attempt to maximize the amount of disability benefits paid under workers' compensation by releasing the workers' compensation carrier from liability for medical expenses for a particular condition even though the facts show that the condition is work-related, Medicare will not pay for treatment of that condition.

(c)           Lump-sum compromise settlement: Effect on services furnished before the date of settlement. Medicare pays for medical expenses incurred before the lump-sum compromise settlement only to the extent specified in § 411.47.

(d)          Lump-sum compromise settlement: Effect on payment for services furnished after the date of settlement -

(1)          Basic rule. Except as specified in paragraph (d)(2) of this section, if a lump-sum compromise settlement forecloses the possibility of future payment of workers' compensation benefits, medical expenses incurred after the date of the settlement are payable under Medicare.

(2)          Exception. If the settlement agreement allocates certain amounts for specific future medical services, Medicare does not pay for those services until medical expenses related to the injury or disease equal the amount of the lump-sum settlement allocated to future medical expenses.

Essentially, the January and March 2022 updates did not change anything regarding a primary payer’s obligation to protect the Medicare fund by considering Medicare’s future interests at time of settlement. Similarly, the updates did not change the CMS work review thresholds for pre-settlement approval of a WCMSA. Most importantly, the updates did not change the well-established tenet that CMS pre-settlement approval of a WCMSA is voluntary. Rather, the updates simply made clear CMS’ position that evidence based or non-submit MSAs will be scrutinized for consistency with the methodology that CMS uses to evaluate WCMSAs that are voluntarily submitted. This should not come as a surprise, as CMS put considerable resources behind developing a methodology for WCMSA review, engaging review contractors, and promulgating its methods through memorandum, town hall teleconferences, webinars, a robust website, and the WCMSA Reference G.

Certainly, finding a primary payer that never disagreed with a CMS counter-higher WCMSA proposal would be akin to finding a unicorn. All primary payers can cite examples of CMS approved WCMSAs that include outlandish prescription medications, surgeries that will never take place and treatments extending a lifetime for claimants who will cease treatment shortly following settlement.  An evidence based/non-submit MSA is a permissible way for a primary payer to address those concerns, but not the only way. Depending on risk tolerance of the parties, CMS submission may still be preferred. Careful preparation of a WCMSA for submission to CMS, especially one prepared by counsel, includes implementation of legal strategies based on state specific workers’ compensation laws and treatment guidelines, and use of contrary medical evidence and/or litigation to effectively reduce prescriptions or treatment BEFORE submission to CMS. The resulting, palatable, CMS approved MSA effectuates settlement, as both the primary payer and the Medicare beneficiary/claimant can be secure in the knowledge that CMS has blessed their schism, evidenced by a CMS pre-settlement approval letter.

Practice Tip:  As always, parties should adequately consider Medicare’s interests, whether or not the settlement will qualify for voluntary submission to CMS for formal review.  The decision to participate in the voluntary submission process or use an evidence based or non-submit MSA should be made in consultation with counsel or other vendors who are well versed in Medicare compliance matters, and with full cooperation of the parties, on a case-by-case basis. 

References:

https://www.cms.gov/files/document/wcmsa-reference-guide-version-35.pdf

Stay tuned for more activity by your Medicare Compliance Committee - paperless conditional payments, forthcoming Section 111 reporting penalties, Medicare Advantage Plan Liens and more coming your way! Meet the members live in Nashville at the NWCDN national conference, where we will be presenting a Medicare Compliance update.  Please contact Nicole Graci of Hamberger & Weiss LLP (NY) or Daniel Hayes of Teague Campbell Dennis & Gorham, LLP (NC) for more in

By Nicole Graci of Hamberger & Weiss LLP (NY) and Daniel Hayes of Teague Campbell Dennis & Gorham LLP (NC)

The NWCDN has re-established its Medicare Compliance Committee, and what great timing! On January 10, 2022, the Centers for Medicare and Medicaid Services (CMS) updated the Workers’ Compensation Medicare Set-Aside Arrangement (WCMSA) Reference Guide, which it does periodically, but this update sent shockwaves throughout the Medicare compliance community. As our first act as a committee, we offer the following analysis of what has become known as “The 4.3 Update.”

CMS’ 1/11/22 update to Section 4.3 of the WCMSA Reference Guide is a strong message about CMS’ view of evidence based or non-submit WCMSA products. On March 15, 2022, CMS updated the Reference Guide again, to clarify that message.

CMS expressed its concern that products commonly called “evidence-based” or “non-submit” MSAs are not adequately protecting Medicare’s interests.  Here is the full text of the 1/10/22 update,

4.3 The Use of Non-CMS-Approved Products to Address Future Medical Care

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.

There has been an increase in the use of evidence based or non-submit WCMSA products in the last few years. Under the theory that CMS’ method for calculating a WCMSA results in inflated medical and prescription expense, resulting in higher settlement costs, evidence based or non-submit MSAs are calculated using alternative methods, resulting in reduced treatment and medication over a claimant’s lifetime and less expense. These products are often accompanied by “guarantees,” offers of post-settlement professional administration of MSA funds, structured WCMSAs and, in some cases, reversionary interests. In response to the 1/11/22 update, the purveyors of evidence based or non-submit MSA products immediately published analyses, arguing that CMS was contradicting the well-established legal reality that CMS pre-settlement approval of a WCMSA is voluntary. Detailed arguments were presented, outlining how CMS was overreaching its authority. CMS responded with the subsequent update on March 15, 2022.

However, a close reading of the January and March updates and review of the Medicare Secondary Payer statute and accompanying federal regulations reveals that the updates are consistent with CMS’ long standing policy that CMS pre-settlement approval, although not required by law, has been and continues to be recommended. The March 15, 2022 update softened the language of the January update, notably changing “will deny” to “may at its sole discretion deny” in reference to post-settlement payment of Medicare covered, causally related services. In addition, the beneficiary/claimant’s burden to attest to proper expenditure of the MSA funds is clarified to include a showing that, “both the initial funding of the MSA was sufficient, and utilization of MSA funds was appropriate.” CMS also clarified that its policy applies to notifications of settlements using evidence based or non-submit MSAs from 1/11/22 forward, but that it is flagging pre-1/11/22 notifications as well. CMS went on to reiterate the legal requirement of the Medicare Secondary Payer statute, regulations, and CMS memorandum that primary payers are obligated to consider Medicare’s interests at settlement, while recognizing that all settlements do not meet the CMS work review thresholds for pre-settlement approval of a WCMSA. It is well known that the CMS work review thresholds are internal and are not safe harbors. 

The full text of the March 15, 2022 update is below, with changes highlighted,  

4.3 The Use of Non-CMS-Approved Products to Address Future Medical Care

A number of industry products exist for the purpose of complying with the Medicare Secondary Payer regulations without participation in the voluntary WCMSA review process set forth in this reference guide. 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 may at its sole discretion deny payment for medical services related to the WC injuries or illness, requiring attestation of appropriate exhaustion equal to the total settlement as defined in Section 10.5.3 of this reference guide, less procurement costs and paid conditional payments, before CMS will resume primary payment obligation for settled injuries or illnesses, unless it is shown, at the time of exhaustion of the MSA funds, that both the initial funding of the MSA was sufficient, and utilization of MSA funds was appropriate. This will result in the claimant needing to demonstrate complete exhaustion of the net settlement amount, rather than a CMS-approved WCMSA amount. Notes: This official policy shall apply to all notifications of settlement that include the use of a non-CMS-approved product received on, or after, January 11, 2022; however, flags in the Common Working File for notifications received prior to that date will be set to ensure Medicare does not make payment during the spend-down period. CMS does not intend for this policy to affect any settlement that would not otherwise meet review thresholds. This comment does not relieve the settling parties of an obligation to consider Medicare’s interests as part of the settlement; however, CMS does not expect notification or submission where thresholds are not met.

CMS did not change its prior WCMSA Reference Guide language, making it clear that the submission process is completely voluntary, as follows:

There are no statutory or regulatory provisions requiring that you submit a WCMSA amount proposal to CMS for review. If you choose to use CMS’ WCMSA review process, the Agency requests that you comply with CMS’ established policies and procedures.

WCMSA Reference Guide., pp. 1, 9 (emphasis original).  Of note, this italicized language is found twice in the Reference Guide. 

The Medicare Secondary Payer statute and accompanying regulations have always afforded CMS the authority to deny payment for work-related treatment if a settlement does not adequately protect Medicare’s interests.  See 42 C.F.R. 411.46, emphasis added:

§ 411.46 Lump-sum payments.

(a)           Lump-sum commutation of future benefits. If a lump-sum compensation award stipulates that the amount paid is intended to compensate the individual for all future medical expenses required because of the work-related injury or disease, Medicare payments for such services are excluded until medical expenses related to the injury or disease equal the amount of the lump-sum payment.

(b)          Lump-sum compromise settlement.

(1)          A lump-sum compromise settlement is deemed to be a workers' compensation payment for Medicare purposes, even if the settlement agreement stipulates that there is no liability under the workers' compensation law or plan.

(2)          If a settlement appears to represent an attempt to shift to Medicare the responsibility for payment of medical expenses for the treatment of a work-related condition, the settlement will not be recognized. For example, if the parties to a settlement attempt to maximize the amount of disability benefits paid under workers' compensation by releasing the workers' compensation carrier from liability for medical expenses for a particular condition even though the facts show that the condition is work-related, Medicare will not pay for treatment of that condition.

(c)           Lump-sum compromise settlement: Effect on services furnished before the date of settlement. Medicare pays for medical expenses incurred before the lump-sum compromise settlement only to the extent specified in § 411.47.

(d)          Lump-sum compromise settlement: Effect on payment for services furnished after the date of settlement -

(1)          Basic rule. Except as specified in paragraph (d)(2) of this section, if a lump-sum compromise settlement forecloses the possibility of future payment of workers' compensation benefits, medical expenses incurred after the date of the settlement are payable under Medicare.

(2)          Exception. If the settlement agreement allocates certain amounts for specific future medical services, Medicare does not pay for those services until medical expenses related to the injury or disease equal the amount of the lump-sum settlement allocated to future medical expenses.

Essentially, the January and March 2022 updates did not change anything regarding a primary payer’s obligation to protect the Medicare fund by considering Medicare’s future interests at time of settlement. Similarly, the updates did not change the CMS work review thresholds for pre-settlement approval of a WCMSA. Most importantly, the updates did not change the well-established tenet that CMS pre-settlement approval of a WCMSA is voluntary. Rather, the updates simply made clear CMS’ position that evidence based or non-submit MSAs will be scrutinized for consistency with the methodology that CMS uses to evaluate WCMSAs that are voluntarily submitted. This should not come as a surprise, as CMS put considerable resources behind developing a methodology for WCMSA review, engaging review contractors, and promulgating its methods through memorandum, town hall teleconferences, webinars, a robust website, and the WCMSA Reference G.

Certainly, finding a primary payer that never disagreed with a CMS counter-higher WCMSA proposal would be akin to finding a unicorn. All primary payers can cite examples of CMS approved WCMSAs that include outlandish prescription medications, surgeries that will never take place and treatments extending a lifetime for claimants who will cease treatment shortly following settlement.  An evidence based/non-submit MSA is a permissible way for a primary payer to address those concerns, but not the only way. Depending on risk tolerance of the parties, CMS submission may still be preferred. Careful preparation of a WCMSA for submission to CMS, especially one prepared by counsel, includes implementation of legal strategies based on state specific workers’ compensation laws and treatment guidelines, and use of contrary medical evidence and/or litigation to effectively reduce prescriptions or treatment BEFORE submission to CMS. The resulting, palatable, CMS approved MSA effectuates settlement, as both the primary payer and the Medicare beneficiary/claimant can be secure in the knowledge that CMS has blessed their schism, evidenced by a CMS pre-settlement approval letter.

Practice Tip:  As always, parties should adequately consider Medicare’s interests, whether or not the settlement will qualify for voluntary submission to CMS for formal review.  The decision to participate in the voluntary submission process or use an evidence based or non-submit MSA should be made in consultation with counsel or other vendors who are well versed in Medicare compliance matters, and with full cooperation of the parties, on a case-by-case basis. 

References:

https://www.cms.gov/files/document/wcmsa-reference-guide-version-35.pdf

Stay tuned for more activity by your Medicare Compliance Committee - paperless conditional payments, forthcoming Section 111 reporting penalties, Medicare Advantage Plan Liens and more coming your way! Meet the members live in Nashville at the NWCDN national conference, where we will be presenting a Medicare Compliance update.  Please contact Nicole Graci of Hamberger & Weiss LLP (NY) or Daniel Hayes of Teague Campbell Dennis & Gorham, LLP (NC) for more information. 

Supreme Court

Exclusive Remedy - Graef v. Continental Indemnity Company, 959 N.W. 2d 628 (Wis. 2021)

Facts:  The Applicant sustained a compensable work injury in November 2012, which caused physical and psychological injuries.  He was prescribed an antidepressant.  On two different occasions, the Insurer denied the initial request for payment related to refills.  The first was in May 2015, and the Insurer paid after being contacted by the pharmacy.  Then, in June 2015, the Applicant left before the Insurer could be contacted and did not refill the medication.  Two months later, he attempted suicide and sustained a gunshot wound.  Two years after the suicide attempt, he filed a tort action in Circuit Court against the Employer’s worker’s compensation carrier, alleging the self-inflicted gunshot wound was a result of the Insurer's negligence.  Specifically, he argued that the Insurer was negligent in failing to approve payment of the refill in June 2015 and, as a result of that negligence, the Applicant attempted suicide.  The Insurer moved for summary judgment stating the Worker’s Compensation Act (the Act) provided the exclusive remedy for the Applicant’s injuries.

Procedural History:  The Circuit Court concluded the exclusive remedy provision did not bar the claim because the Insurer would not concede that the Applicant’s claim would prevail if it was filed as a worker’s compensation claim.  The Court of Appeals reversed this decision, and the matter was brought before the Supreme Court of the State of Wisconsin.

Issue:  Does the Exclusive Remedy Provision bar a tort action for the alleged injuries?

Finding:  The Supreme Court affirmed the Court of Appeals' determination that the Act provides an exclusive remedy for the alleged injuries and remanded the matter to the Circuit Court to grant summary judgement.  Further, the Court said the allegations in the Applicant’s complaints, if proven, would satisfy the conditions of liability under the Act.

Court of Appeals

Unreasonable Refusal to Rehire - Anderson v. LIRC, 398 Wis.2d 668 (Ct. App 2021)

The Applicant began working for a car dealership in 2010.  He sustained an injury in October of 2014 that resulted in surgery.  The Applicant was off work after the surgery and the dealership struggled to find a temporary replacement for his position.  Due to staffing issues, the dealership hired a permanent replacement in November of 2014.  The dealership told the Applicant to return when he felt better and he would be placed in a sales position that was less physically demanding.  The Applicant reached an end of healing from the work injury in October of 015.  He was given permanent restrictions that were inconsistent with the 70-pound lifting requirement needed for his pre-injury position.  The Applicant never reported back to the dealership, nor did he inform them of his permanent lifting restrictions.  Instead, the Applicant contacted DVR to find a new job.  He did not find new employment.  In January of 2016, the Applicant filed an Unreasonable Refusal to Rehire claim against the dealership.

Procedural History:  The Administrative Law Judge (ALJ) denied the claim.  The Labor and Industry Review Commission (LIRC) affirmed the denial, as did the Circuit Court.

Issue:  Can the Applicant meet their burden of proof for an Unreasonable Refusal to Rehire claim if they did not attempt to return to work for the date of injury employer?

Finding:  The Court of Appeals affirmed the decision, stating that an employee must prove they applied to be rehired to establish a prima facie case for Unreasonable Refusal to Rehire.  Despite the Applicant arguing that his position was terminated while he was in a healing period, the Court determined the dealership had a reasonable basis to terminate the Applicant because he could no longer perform his pre-injury job.  Further, the Court said the Applicant had an obligation to express to the employer his interest in returning to  work in a different position given that the injury prevented him from returning to his pre-injury position.  In its decision, the Court also mentioned that the Applicant failed to advise the dealership of his permanent restrictions.

Labor and Industry Review Commission (LIRC)

Safety Violation - Natera v. City of Madison, 2014-004948 (LIRC January 27, 2022)

Facts:  The Applicant sustained a left knee injury when he slipped on ice outside the Employer’s building.  He was walking to his vehicle.  The area where the sidewalk met the curb had sunk approximately one inch and water would pool in that area.  The Employer was aware of this and kept buckets of salt and sand near the area.  On the date of injury, the area had not been salted or sanded.  18 months after the injury occurred, the Employer replaced the sidewalk, allegedly to comply with Handicap Access.  The Applicant alleged entitlement to a 15% increase in compensation due to an Employer’s safety violation.  The ALJ denied the Applicant’s claim.

Issue:  Does failure to replace the sidewalk before the injury occurred constitute a failure to address unsafe conditions and, thus, entitle the Applicant to increased compensation?

Finding:  LIRC found the Employer knew of the unsafe condition and, despite providing salt and sand, did not take measures to address the unsafe condition for an extended period of time.  Simply put, the Employer’s failure to replace the sidewalk to eliminate the hazard, along with the failure to ensure regular salting, meant they did not take sufficient measures to address an unsafe condition.  Thus, awareness of a hazard and a lack of active steps to alleviate that hazard can result in increased compensation stemming from a safety violation penalty.

Unexplained Injury - Fox v. A. W. Oaks & Son, 2017-023569 (LIRC July 13, 2021)

Facts:  Applicant worked as a skid steer operator.  The Applicant was found lying outside of his truck on the pavement in a McDonald’s parking lot after leaving work that day.  He was picked up by an ambulance and the Applicant denied any injury when questioned by the EMT, but later said there was a minor accident while operating his skid steer.  At the hospital, the doctor noted there was some trauma to the left lateral chest while operating construction equipment.  The Applicant passed away while at the hospital.  The Sheriff's Department and OSHA conducted independent investigations, but neither uncovered any evidence of a work injury.  Likewise, there were no witnesses.  A co-worker did have a conversation with the Applicant prior to the Applicant leaving on the date of injury, but did not observe the Applicant to be injured or in pain.  The Applicant’s wife filed a claim for death benefits, relying on a medical record review report that concluded the Applicant sustained fatal injuries while operating his skid steer.  The ALJ denied the claim.

Issue:  Can a compensable injury be found in the absence of a reported or witnessed injury when the Applicant is no longer alive to provide a statement?

Finding:  LIRC affirmed the denial stating the MRR opinion was inconsistent with the absence of reported or witnessed injuries, the absence of damage to the skid steer, and the fact that the Applicant would have had to have finish his shift after being crushed by a skid steer as if nothing happened.  Therefore, when the evidence presented clearly points to an unexplained injury, it cannot be found compensable or arising out of employment.

Permanent Total Disability - Fisher v. REM Wisconsin II, Inc., 2008-022049, 2015-014979, 2016-018345 (LIRC June 10, 2021)

Facts:  The Applicant alleges numerous work injuries at multiple employers.  She also alleges she is permanently and totally disabled.  She based this claim on the opinion of her vocational expert that said she was “odd-lot” permanently and totally disabled.  The Respondent's vocational expert said she could work in various positions within her permanent restrictions and she would be a viable candidate for retraining.  However, the Respondent’s expert did not include any specific information as to the positions available at the time of their report.  The ALJ found the Applicant’s expert more credible and awarded permanent and total disability benefits. 

Issue:  Can an employer overcome a prima facie case of “odd-lot” permanent and total disability without specific examples of suitable employment?

Finding:  LIRC found the Applicant clearly established the prima facie case of “odd-lot” permanent and total disability based on the evidence.  The only rebuttal evidence offered by the Respondent was the vocational opinion without specific reference to available employment at the time of the evaluation.  There was no labor market survey or identification of actual jobs.  Thus, the Respondent had not met their burden and LIRC affirmed the ALJ’s opinion.

Intervening Cause - Tiedeman Jr. v. County of Dane, (LIRC February 18, 2021)

Facts:  The Applicant sustained a compensable left shoulder injury, reached an end of healing, and took a new job at a different employer.  The Applicant claimed to have subsequently sustained a right shoulder injury while working at his home.  He alleged that the initial left shoulder injury caused his subsequent right shoulder condition due to overuse because he was worried about re-injuring his left shoulder.  The claim was denied by the ALJ.

Issue:  When does the causation chain from a conceded work injury cease to exist?

Finding:  LIRC found that the act of moving logs at his home and the decision to use his right arm to do so were intervening acts that interrupted the chain of causation between the initial left shoulder work injury and the subsequent off-the-job right shoulder injury.  The Applicant’s decision to use his right arm, despite knowledge of pre-existing conditions in his right shoulder, made his conduct negligent and intentional.  He did not have to participate in this activity as part of treatment for his left shoulder and it was solely his decision to perform the activity.  No emergency or urgency prompted the use of the right arm.  Therefore, the Applicant’s unreasonable decision under the circumstances broke the chain of causation. 

Loss of Earning Capacity - Topp v. Frank Bros., 2016-019066 (LIRC February 18, 2021)

Facts:  The Applicant worked as an equipment operator.  He alleged an injury when he was thrown from a machine he was loading onto a trailer and the machine subsequently fell on him.  He sustained a left acetabular fracture, a pelvis fracture, a left shoulder injury, and a low back injury.  He was given a 30% permanency rating to his hip, 25% to his left shoulder, and 5% to his low back by his treating doctors and underwent an FCE that provided permanent restrictions.  The Applicant obtained a vocational opinion that said he was permanently and totally disabled because he was 52 years old and had not obtained a high school degree or the equivalent.  The Respondent also obtained a vocational opinion that said, although the Applicant may need some “remediation” to obtain his GED, retraining was possible and a technical school program would restore his earning capacity.  It was also noted that the Applicant had not made any attempt to re-enter the labor market since the claimed date of injury.  The ALJ found the claim compensable and awarded permanent and total disability benefits.

Issue:  Does the Applicant need to explore retraining before making an “odd-lot” permanent and total disability claim?

Finding:  LIRC found that the issue of loss of earning capacity was “premature” without information bearing upon the Applicant’s eligibility for services from the Division of Vocational Rehabilitation (DVR).  LIRC remanded the matter and instructed the Applicant to apply with DVR and determine if services are available, and, if so, to follow through on those recommendations.

For any questions regarding the above cases or any Wisconsin worker’s compensation issues, please contact Attorney Matthew Kurudza at mkurudza@lindner-marsack.com or Attorney Chelsie Springstead at cspringstead@lindner-marsack.com, or by phone at 414-273-3910.

On Thursday, February 3, 2022, Governor Walz signed a bill into law that extended the workers’ compensation presumption for certain frontline professions through 2022. The prior law addressing this presumption expired on December 31, 2021. As of now, the new law is not retroactive to January 2022, but there may be legislation that addresses this question later this year.

This law extends the presumption that has been in place for much of the pandemic. By way of reminder, this presumption indicates that employees working in first responder or healthcare occupations will be presumed eligible for workers’ compensation benefits if they either test positive for COVID-19 or are diagnosed by a licensed physician, physician’s assistant, or APRN without a test. In situations where a test has not been done, a copy of written documentation of the diagnosis shall be provided to the Employer and Insurer. The following occupations fall into this presumption:

• Firefighter

• Paramedic

• Nurses or Healthcare Workers

• Correctional Officer/Security Counselor at Minnesota Correctional Facilities

• Emergency Medical Technician

• Healthcare provider, nurse, or assistant employed with home care or long-term setting

• Workers required to provide childcare to first responders and health care workers under certain Executive Orders

In summary, if an employee shows that he or she works within one of these occupations and either tests positive for or is diagnosed with COVID-19, the burden of proof will shift to the Employer and Insurer to rebut the presumption. Employers and Insurers will still be able to show that the employment was not a direct cause of the disease, but it will be much more difficult to prevail on a denial of liability when one of these types of employees contract COVID-19. To note, the date of injury in these situations shall be the date the employee is no longer able to work due to a diagnosis of COVID-19 or due to the symptoms later diagnosed as COVID-19, whichever occurs first.

This Legislative Update was prepared by Parker Olson.

In the matter of Thomas Mangiameli v Village of Hoffman Estates, 17WC 30825 , 21IWCC 0416 the Commission decided what degree of evidence was needed to rebut the presumption that a firefighters cancer was causally related to his employment.

The Commission found that based on legislative history , that section 6 (f) does not require a strong rebuttable presumption, requiring clear and convincing evidence. Rather,  we conclude that the legislature intended an ordinary rebuttable presumption to apply , simply requiring the employer to  offer some evidence sufficient to support a finding that something other than claimant’s occupation as a firefighter caused his condition.

This decision will not only effect firefighters but will be the Commission’s view on the standard necessary to rebut the presumption in COVID cases.  The case is currently on Appeal before the Circuit Court. 

NWCDN  Attorneys Adam Maciorowski  and Robert Maciorowski represented the Respondent Employer Village of Hoffman Estates  in establishing this favorable standard of evidence.

The Oklahoma Workers’ Compensation Commission has unanimously agreed with the administrative law judge that there is a minimum statute of limitations of one (1) year from the date of injury to file a claim. 

85A O.S. 69(A)(1) provides that a claim shall be barred unless filed within one (1) year of the date of injury.  The second part of the statute, after the word “or” states that if a claimant has received benefits, the statute of limitation is six (6) months after the payment of benefits.  In Erasmo Paredes v. Schulumberger Technology Group, the respondent argued the employer provided three (3) months of benefits after the injury and the statute of limitations ran six (6) months after payment of benefits, therefore, shortening the original statute of limitations to nine (9) months from the date of injury.

The claimant filed a claim ten (10) months after the injury.  The Workers’ Compensation Commissioners found that the statute of limitations is the greater of the two independent statute of limitations provisions.  The opinion found the word “or” is used to express an alternative statute of limitations, with the claimant receiving the benefit of whichever of those is longer.

Legal Update by Attorney Marshall Tuttle and Law Clerk Jordan Gehlhaar

Iowa Uniform Jury Instruction 200.34 is titled “Previous Infirm Condition” and reads: 

If plaintiff had [a] condition making [them] more susceptible to injury than a person in normal health, then the defendant is responsible for all injuries and damages which are experienced by plaintiff that are caused by defendant's actions, even though the injuries claimed produce a greater injury than those which might have been experienced by a normal person under the same circumstances.

This is known as the “Eggshell Plaintiff Rule.” It originates from the idea that some victims have an “eggshell-thin” skull which results in abnormally excessive damage. The rule requires the person causing the injury to be liable for all damage, even though most people would not experience the same effects or require the same treatment. It applies in personal injury cases where the victim is more susceptible to injury because of their pre-existing condition. For example, if you’re involved in a minor car accident and the other driver has osteoporosis or heart disease, you are still liable for their substantial medical care even if a “healthier” person would not have required care. Therefore, this rule can make damages—such past and future medical expenses—much higher.

The Iowa Supreme Court recently discussed this instruction in Mengwasser v. Comito and Capital Fruit Company. The plaintiff in that case was rear-ended by a vehicle traveling approximately five miles per hour; the airbags did not deploy. She requested an eggshell plaintiff instruction under the theory that degenerative disk disease in her neck made her more susceptible to injury. The trial court denied this instruction and she appealed. The appellate court affirmed, finding the plaintiff had only proven she aggravated a previous injury, which is not the same as proof of a greater susceptibility to injury.

For this instruction to apply, the plaintiff must request it prior to trial. Additionally, there must be evidence showing that prior to the injury, a condition made them more vulnerable or prone to injury than a person of average health. This can be determined through medical records, discovery responses, and correspondence with opposing counsel.

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Peddicord Wharton Legal Updates are intended to provide information on current developments in legislation impacting our clients. Readers should not rely solely upon this information as legal advice. Peddicord Wharton attorneys would be pleased to answer any questions you may have about this update. ©2022 Peddicord Wharton. All Rights Reserved.

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