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On Jan. 1, six sets of emergency regulations that implement SB 863 became effective. Those regulations remain in effect until July 2, and then expire by operation of law unless the Division of Workers’ Compensation (DWC) files a certificate of compliance with the Office of Administrative Law (OAL) by 5 p.m. on July 1, or requests a readoption of the emergency regulations.
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STONE LOUGHLIN & SWANSON, LLP
May 2013 Workers' Compensation Update
Lawmakers approve 7 new comp bills this Legislative session
Late in the session, lawmakers approved seven new bills relating to workers' compensation. Senate Bill 381 by Sen. Leticia Van De Putte (D-San Antonio) adds new language to a Texas Labor Code provision (Tex. Lab. Code 419.002), a statute which bars deceptive use of the name, symbols, and/or logos of the Texas Department of Insurance or Division of Workers' Compensation and makes it illegal to impersonate these agencies. The new bill is aimed at preventing constitutional challenges to this statute. Commissioner Rod Bordelon told the Senate State Affairs Committee that the bill would protect the general public from believing that the Division had endorsed certain attorneys or health care providers. Bordelon said that the Division counted 24 violations of the statute since it was enacted in 2005.
House Bill 2645 by Representative Chris Turner (R-Arlington) would enumerate that the TDI may continue to regulate independent review organizations (IROs). House Bill 1762 by Representative Four Price (R-Amarillo) would clarify that temporary employees are covered under workers' compensation law. House Bill 581 by Representative Eddie Lucio (D-Harlingen) would enable nurses at public hospitals to sue their employer for violating state whistleblower laws. (The House and Senate approved different versions of this bill, and leaders may meet in committee to negotiate final wording of the bill.) House Bill 3152, relating to network contracting practices, would require administrators and managers of specialty networks to clearly identify themselves and network rates. The bill is expected to reduce confusion over key terms in the networks' contracts and assist the Division to create more accurate fee guidelines.
Senate Bill 801 by Representative John Carona (R-Dallas) would get rid of the requirement that insurers deposit $50,000 with the Department of Insurance, a regulation that was initially aimed at protecting against insolvency. Senate Bill 1322 by Senator Leticia Van De Putte (D-San Antonio) would allow for the formation of networks by home health care providers and DME providers.
Senate declines to vote on bill protecting communications between carrier attorneys and employers
Session is over, and the Senate did not act on House bill 1468 (Representative Kenneth Sheets, R-Dallas), although the House of Representatives had approved the bill. This bill would have allowed carriers to refuse to disclose communications between employers and insurance carrier attorneys in bad faith actions and other certain legal proceedings. These communications would have been considered within the realm of attorney-client privilege. Last summer, the Texas Supreme Court held that communications between an employer and a third party attorney for a workers compensation carrier were not privileged from discovery inIn Re XL Specialty Insurance Co. and Cambridge Integrated Services Group Inc.(Tex. June 29, 2012). The case has created a problem for carriers, leading many to place strict restrictions on communications between employers and carrier attorneys.
Report of skin abscesses from use of steroid injections
The FDA has received seven reports of illness in connection with steroid injections made by a Tennessee compounding pharmacy, Main Street Family Pharmacy (MSFP). At least one appears to be fungal in nature. Products from MSFP have reportedly been shipped to medical facilities in Texas, as well as Alabama, Arkansas, California, Florida, Kentucky, Louisiana, Mississippi, New Mexico, Illinois, North Carolina, and South Carolina. The injections contained methylprednisolone acetate, the same drug linked to a meningitis outbreak affecting over 700 individuals last year, including over 55 deaths. The FDA says its first priority is to ensure all products from MSFP are no longer in use. The pharmacy has launched a recall of all of its sterile products, and has also agreed to stop compounding sterile drugs for the duration of the investigation.
Raising the Bar for MMI/IR Exams
The Division has developed new examinations to test designated doctors and other doctors seeking certification to conduct MMI and IR exams in workers’ compensation cases. As of May 1, 2013, the new examinations will be the only examinations approved by the Division for certification or re-certification. The new tests will no longer be administered onsite following the certification training sessions. Rather, the Division has contracted with PSI Services LLC
(PSI) to administer examinations to test designated doctors and doctors seeking authorization to certify MMI/IR. PSI will provide the testing through a network of computer examination centers throughout Texas, and test-takers will be notified whether they have passed immediately following completion of the exam. The first day for administration of the new examinations was May 13, 2013. Stone Loughlin & Swanson, LLP welcomes this change and is hopeful that the new certification examinations will increase the quality of MMI/IR certifications system-wide.
Division hosts educational sessions on pharmacy closed formulary
The Division will hold educational sessions for system participants at its field offices throughout the month of June on the subject of the pharmacy closed formulary. The sessions will provide information on the initial applicability and results of the closed formulary rules, with special emphasis on the transition of legacy claims to the pharmacy closed formulary. Visit the Events and Training Calendar of the Division’s website for dates, locations, and times for these free sessions.
"ObamaCare" will collect medical records of workers’ compensation claimants
The data collection regulations of the Affordable Care Act (also known as "ObamaCare") will include provisions for the collection of medical information related to work injuries. Personal medical records, including electronic medical records, will be incorporated into the program. The database, which is the biggest and most expansive database of personalized medical information, will be administered by a newly-created unit, The Federal Data Services Hub, under the authority granted to the Internal Revenue Service (IRS). The IRS has requested funding for 1,954 full-time employees for its Affordable Care Act office in 2014.
It’s a bird . . . it’s a plane . . . it’s SuperForm! Division issues reminder to conform to DWC-32 requirements; form serves many functionsThe Division sent out a reminder to system participants, reminding them that the DWC Form-32 (Request for Designated Doctor Examination) is not just a document to be filed to request a DD exam; rather, the form serves a multitude of purposes, including providing the basis for
the selection of the DD, guidance for issues to be addressed by the DD in the narrative report, and guidance to the Division in issuing its notice forms. The Division reminded participants that accurate and complete information from the requestor is necessary in order to ensure that a qualified DD is selected to examine the injured worker. Complete and accurate information also provides the DD with information necessary to evaluate and to provide a clear answer regarding the issues he or she is being asked to address.
The Division requested that party participants provide full information regarding the injured worker’s treating doctor, the existence or non-existence of a network or political subdivision health plan, the injured employee’s current diagnosis or diagnoses and body part(s) affected by the injury, and (where applicable) the specific injuries determined to be compensable by the Division and/or accepted as compensable by the insurance carrier, and the diagnoses or conditions that are in dispute. The DWC-32 also requires the requestor include an accurate statutory date of MMI, since, in most cases, the DD cannot certify a date of MMI after the date of statutory MMI. The Division also reminded participants that due to the repeal of Rule 130.6(b)(5), multiple certifications are only to be issued where the DD is being asked to address MMI, IR, and extent of injury. Accordingly, system participants should only request multiple certifications where all three issues (MMI, IR, and extent) are being addressed by the DD. The Division warned that requests not meeting the requirements of the rule will be denied pursuant to Rule 127.1(b),(c) and (d).
Division changes email domain and agency web address
The Division has changed its domain from @tdi.state.tx.us to @tdi.texas.gov, which means that all personnel email addresses have also changed. Be sure to update your email contact list to reflect the new domain (e.g.Jane.Smith@tdi.texas.gov) prior to June 1, 2013. The Division has also revised a number of forms to reflect the new email domain and agency web address.
Recent enforcement actions against carriers and health care providers
The Division recently announced final disciplinary actions taken against insurance carriers and health care providers. Actions against carriers included orders citing violations of the Texas Labor Code and rules relating to timely payment of medical bills, timely payment of income benefits to workers' compensation claimants, and retrospective review of the medical necessity of preauthorized medical treatment. Fines assessed against carriers ranged from $2,000 to $23,500. Actions against health care providers included orders citing violations related to failure to timely file and accurately complete Division forms, reports, and records. Fines assessed against providers ranged from $3,500 to $4,000, and some providers were ordered to undergo compliance training, undergo monitoring and review of randomly-selected patient records, and/or submit their workers' compensation patients' records for Medical Quality review.
Kathleen Clearly v. Decatur Memorial Hospital
The petitioner was claiming that she needed a lumbar fusion as a result of an accident at work. We prevailed at the Commission, and on December 13, 2011, the Circuit Court of Macon County confirmed the Commission’s decision, denying the petitioner’s request for a lumbar fusion, ongoing TTD and permanency. There we successfully convinced the Arbitrator, the Commission and the Circuit Court Judge to adopt the opinion of Dr. Pineda, the independent medical evaluator, over the treating physician. The petitioner never returned to work. (Decided February 24, 2010)
Dominique Kay v. Northern Illinois Medical Center and Centegra Health System,
The petitioner was alleging that Northern Illinois Medical Center was the employer and the only party entitled to protection under the Workers’ Compensation Act, alleging that Centegra Health System was liable for her injury under common law based on a negligence theory. She was also alleging that she was permanently and totally disabled as a result of her employment and entitled to $66,560.00 for 2-1/2 years in temporary total disability benefits and then $26,624.00 a year in permanent total disability benefits. At the time of the injuries, the petitioner was 37 years of age. The Arbitrator found there was dual employment between Centegra Health System and Northern Illinois Medical Center resulting in each entity receiving the necessary protection under the Workers’ Compensation Act, in a sense throwing out the common law negligence case in the Circuit Court based on duel employment. nbsp; The Arbitrator denied the 2-1/2 years of temporary total disability, awarding the petitioner 60% loss of use of a man for her multiple surgeries ($138,240.00) as opposed to the $66,560.00 in temporary total disability benefits and the $1,011,712.00 in permanent total disability benefits. The petitioner’s settlement demand in the civil case was $6 million. The petitioner has never returned to work. (Decided December 27, 2010) The petitioner has now appealed that decision.
Brett E Hill v. Tate & Lyle
The Arbitrator awarded $97,938.43 in medical bills, $23,953.00 in temporary total disability benefits and $69,079.62 in permanency representing 30% loss of use of the right arm and 25% of the left arm for repetitive trauma injuries. On review, the Commission reversed the Arbitrator’s decision finding the petitioner failed to prove his condition of ill-being was causally related to his employment. On April 17, 2012, the Appellate Court affirmed the “no award” of the Commission.
Jeff Hayes v. Henry Pratt
The petitioner was claiming that working as a Rubber Mold Operator caused or contributed to a heart attack and that a slow medical response caused the petitioner to develop anoxia to the brain. Our trial presentation proved the claims had no merit through testimony by occurrence witnesses and Dr. Fletcher. The arbitrator denied the claim. On July 7, 2011, the Commission affirmed that denial.
Maria Colon v. Aldi
A cashier claimed carpal tunnel syndrome due to repetitive activity and a torn rotator cuff due to a specific incident. Based on testimony by a district manager about the adoption of safe work practices, the arbitrator denied the carpal tunnel claim on October 24, 2012. The Workers’ Compensation Commission affirmed.
Frank Bird v. Eagle Wings
The petitioner was seeking an order from the Arbitrator compelling the company to authorize a wrist fusion and to award 95 weeks of temporary total disability benefits. The case was tried and the Arbitrator found there was no causal relationship between the petitioner’s undisputed accident and the need for a wrist fusion. He also denied the temporary total disability benefits. On November 28, 2012, the Commission affirmed that denial.
Courtney Carter v. Gottlieb Hospital
This was a disputed case that was tried. The petitioner was seeking 191 weeks of temporary total disability benefits and authorization for right knee surgery which they were trying to relate to an August 29, 2009 accident. On July 17, 2012, we received a favorable decision from the Arbitrator finding that the petitioner failed to prove that she sustained a compensable accident arising out of her employment.
Larry Matson v. City of Waukegan
The Arbitrator awarded the petitioner $88,199.35 in medical expenses, $19,933.44 in temporary total disability benefits and $88,765.59 in permanency representing 30% of a person for a spinal fusion. In total, the decision amounted to $196,898.29. We appealed, and in June of 2012, the Commission reversed that decision and reduced the Arbitrator’s decision from $196,898.29 to $22,191.38. The petitioner appealed to the circuit court where the matter is now pending.
Ann Morgan v. Tate & Lyle
The Arbitrator denied the petitioner’s repetitive trauma carpal tunnel claim. On June 21, 2012, the Commission affirmed the Arbitrator’s denial finding that the petitioner failed to prove that the carpal tunnel syndrome was causally related to her employment. (Decided June 15, 2012)
Patsy Burns v. Naperville Community Unit School District 203
The primary issues were whether the petitioner’s accidental fall was compensable and whether her foot conditions which had been surgically treated by Dr. George Holmes, were causally related to the accident. We took the position the fall did not arise out of the employment but rather was a personal risk due to her shoe wear. In the alternative, we argued that any award should be commensurate with the opinion of our Section 12 examiner, Dr. Samuel Vinci, who found the petitioner had a preexisting degenerative and hereditary condition which was only temporarily aggravated by her fall.
Arbitrator Kinnaman decided the petitioner's accident was compensable, finding the petitioner's sandal stuck to the carpeting which in turn caused her to fall. However, she agreed with our position the petitioner had sustained only a temporary aggravation of her preexisting congenital condition as a result of her accident. She found no basis for awarding TTD benefits and limited the permanency to 5% of a foot. Furthermore, since she did not find any causal relationship between the accident and the petitioner’s multiple surgeries, any potential exposure for reimbursing the husband's insurance carrier for the medical bills it had paid was eliminated.
Both sides filed reviews; we wanted to preserve the accident defense for appeal. After briefing and oral argument, the Commission issued a decision affirming the arbitrator’s decision in its entirety. The petitioner chose to forego further appeal.
Carrie Bond v. PPG
At arbitration, the petitioner was alleging that as a result of her 37 years of employment, she sustained repetitive trauma to her upper extremity. The respondent at the time objected to the petitioner’s testimony going back 37 years, arguing that the statute of limitations precluded her from going back more than three years. The Illinois Workers’ Compensation Commission affirmed the arbitrator’s decision, finding that the petitioner was entitled to go back 37 years in describing her repetitive trauma. On April 17, 2013, the Circuit Court of Macon County reversed the Illinois Workers’ Compensation Commission, finding that this was a case of first impression in holding that in repetitive trauma cases, the three year statute of limitations does apply. Therefore, the petitioner could only describe previous work activities going back three years from the date of accident.
Theresa Garrett v. Decatur Memorial Hospital
The petitioner alleged that she sustained accidental injuries to her back requiring a lumbar fusion. The petitioner never returned to work from the injury in question. At arbitration, we successfully argued that the petitioner returned to her pre-injury status after the work related injury, negating her claim for lost time, permanency or additional medical benefits, including the cost of the fusion surgery. The Illinois Workers’ Compensation Commission affirmed the favorable award and the Appellate Court of Macon County also confirmed eve n though the petitioner never returned to work and was alleging that she is permanently and totally disabled.
Mustafa Alassady v. Berner Foods (Nationwide)
This was a disputed case, where the petitioner was seeking two years of temporary total disability benefits and an order compelling the employer to authorize a spinal fusion. The case proceeded to trial on December 22, 2011. We called four witnesses and after hearing from the petitioner the Arbitrator denied the petitioner’s claim finding the petitioner not credible. As a result of that finding the Arbitrator went on to find that the petitioner failed to prove that he had sustained an accident that arose out of and in the course of his employment and denied the petitioner’s request for temporary total disability benefits, surgery and permanency. The petitioner filed a Petition for Review with the Commission, which affirmed the Arbitrator’s decision. The petitioner appealed to the Circuit Court, which also confirmed the Commission’s decision denying his claim. The petitioner has now appealed to the Appellate Court.
February 12, 2013
ISSUE 1:
SUPREME COURT SAYS FUENTES “A”
ISSUE 2:
WILKINSON DEAD
FUENTES
Until May 3, 2007, the question of how to compute the value of an award after apportionment under L.C. 4663 / 4664 had been answered / unanswered since April 19, 2004.
The first major landmark in this area was an en banc decision in the Escobedo case rendered April 19, 2005 (petition for Writ of Review later denied). A couple of months later, another en banc decision issued in Nabors on June 9, 2005. This decision would later be overturned by a 1st District Court of Appeal (DCA) decision one year later, June 8, 2006.
In between the 2 decisions in Nabors, the 5th DCA rendered its decision in Dykes on December 20, 2005. In short, the Dykes formula for computing the value of an award after apportionment was the polar opposite of the en banc decision in Nabors. The DCA opinion in Nabors agreed with Dykes.
On August 30, 2006, another panel of justices in the 1st DCA, different from the Nabors panel, issued an opinion inBrodie, basically agreeing with Nabors and Dykes in principle, but changing the formula a little.
A day later, the 3rd DCA weighed in with a 44 page opinion in 4 consolidated cases, referred to as Welcher. This opinion, in no uncertain terms, disagreed with Dykes and Nabors, and found that the original majority opinion in the Nabors en banc set forth the correct formula.
Given this great disparity in the interpretation of the new apportionment law, the Supreme Court granted review inWelcher and companion cases on November 15, 2006.
In related matters, the 3rd DCA, in a published opinion in Kopping dated 9-11-06, had confirmed that the L.C. 4664(b) presumption is indeed a conclusive presumption. The injured worker may not even offer evidence of medical rehabilitation following the prior award. However, the court also clarified that the burden is on the CA to prove overlap. Prior cases (Strong, Sanchez) had burdened the injured worker with disproving overlap.
On May 3, 2007, the Supreme Court issued its decision in Welcher/Brodie et al. Given the circumstances in the several cases before it, the Court addressed calculation of the level of permanent disability after apportionment under L.C. 4664 and also after apportionment under L.C. 4663.
In short, the Court retained what had become known as Fuentes Formula A, which in workers' compensation parlance became "subtracting percentages, not money". That is to say, if the current overall level of disability is 71%, and the employee had a prior award of 63%, the "new" disability would be 8% (71-63). Or, if the overall level of disability is 50%, but only 70% of the causation of disability is industrial and 30% of the causation is non-industrial, the disability is 35% (.7 x 50).
WILKINSON
When L.C. 4750 was repealed 4-19-04, the “(Bauer) Wilkinson Doctrine” – which held that when a worker sustains two or more injuries to the same part of the body [while employed by the same employer], and the condition resulting from the several injuries becomes permanent and stationary at the same time, the worker would be entitled to one over-all level of permanent disability without apportionment – became ancient history.
L.C. 4750 had allowed apportionment for “pre-existing” disability. L.C. 4663 requires apportionment of permanent disability based on CAUSATION. One of the apportioned CAUSES of current disability may be a prior injury which had not yet resulted in a definable disability which “pre-existed” the subject injury.
So concluded the WCAB (en banc) in Benson v. WCAB 72 CCC 1620, a decision affirmed by First DCA 74 CCC 113. On April 29, 2009, the Supreme Court denied review.
February 12, 2013
NOTE: A Board Panel Decision issued on 7-24-12 in the case Anderson v. Jaguar ADJ716686 on this issue. The Board determined that estimating future SAWW increases at 3% each year was in the best interest of the injured worker.
Labor Code Sec. 4453(a)(10) provides for certain increases to the statutory AWE structure for TD payments and Labor Code Sec.4659(c) provides for certain increases in life pension and total permanent disability payments based upon the "state average weekly wage" (SAWW). SAWW is a number compiled by the United States Department of Labor based on the average weekly wage of California employees covered by unemployment insurance for the 12 months ending March 31 of the calendar year (preceding the year in which the injury occurred).
As of March 31, 2006, the SAWW for the 12 months preceding was $880.00 per week. As of March 31, 2005, the SAWW was $838.42. This results in a 4.96% increase in SAWW from 2005 to 2006.
Labor Code Sec. 4453(a)(10) provides that for injuries occurring on or after 1-1-05, for purposes of computing temporary disability indemnity, earnings shall be taken at not less than $189.00, nor more than $1,260.00. (There was no change in this structure for injuries on or after 1-1-06) However, this subsection further provides:
"Commencing on January 1, 2007, and each January thereafter, the limits specified in this paragraph shall be increased by an amount equal to the percentage increase in the state average weekly wage as compared to the prior year."
The effect of this (4.96%) increase is that for injuries occurring on or after 1-1-07, for purposes of computing temporary disability indemnity, AWE shall be taken at not less than $198.37 (1.0496 x $189.00), nor more than $1,322.50 (1.0496 x $1,260.00). This results in a so-called "Minimum TD Rate" of $132.25 per week ($198.37 x 2/3), and a "Maximum TD Rate" of $881.67 per week ($1,322.50 x 2/3)).
The SAWW as of 3-31-07 was $914.60 reflecting a 3.93% increase over 3-31-06. This 3.93% increase becomes effective 1-1-08. As of then, for purposes of computing temporary disability indemnity rates, AWE shall be taken at not less than $206.18 (1.0393 x 198.37) and not more than $1,374.47 (1.0393 x 1,322.50). These changes result in so-called "Minimum TD Rate" of $137.45 / wk and a so-called "Maximum TD Rate" of $916.32.
Of course, these increases in the statutory AWE structure may affect temporary disability indemnity rates for "older" injuries also. See Labor Code Sec. 4661.5.
While the SAWW increased the statutory AWE structure in Labor Code Sec. 4453(a)(10), it actually increases the amount of the life pension or total permanent disability payment under Labor Code Sec. 4659(c).
This subsection provides:
"For injuries occurring on or after January 1, 2003, an employee who becomes entitled to receive a life pension or total permanent disability as set forth in subdivisions (a) and (b) shall have that payment increased annually commencing on January 1, 2004, and each January 1 thereafter, by an amount equal to the percentage increase in the "state average weekly wage" as compared to the prior year."
Past SAWW increases were 1.97% effective 1-1-05 and 4.01% effective 1-1-06. There was no SAWW increase effective 1-1-04.
As an example, assume an employee with real life earnings of $904.00 per week was injured 1-2-03. His statutory AWE for TD was $903.00/wk [Labor Code Sec. 4453(a)(8)], yielding a TD rate of $602.00/wk. If he was declared 100% PD as of 12-31-03, his permanent total disability indemnity rate would be $602.00 [L.C. 4453(a)(8)]. Note that if his injury had occurred prior to 1-1-03, this would have been his weekly rate for life. Crutcher v. WCAB 46 CCC 843. However, for this 1-2-03 injury, Labor Code Sec. 4659(c) applies.
As there was no SAWW increase effective 1-1-04, his weekly rate remained $602.00/wk throughout 2004. As of 1-1-05, the weekly rate would have had to increase to $613.86/wk (1.0197 x $602.00); as of 1-1-06, the weekly rate would have had to increase to $638.48 (1.0401 x $613.86); and as of 1-1-07, the weekly rate had to increase to $670.15/wk (1.0496 x 638.48). As of 1-1-08, the weekly rate will have to increase to $696.49 (1.0393 x 670.15).
For injuries after 1-1-03, where the permanent disability is less than 100%, but 70% or more, life pension payments would not yet have commenced.
If you have any questions, please email them to tbyrne@hannabrophy.com.
For the past several years, partner Tony Macauley has authored a workers' compensation article for the ABA Tort Trial & Insurance Practical Law Journal. This year's article, Recent Developments in Workers' Compensation and Employers' Liability Law, was co-authored by Hanna Brophy associates Darren Chan and Natasha Dighe. The piece provides an overview of recent case law across twenty different states.
View Article
Ever since the en banc opinion in Aldi v. Carr, McClellan, et al, (2006) 71 CCC 783 (W/D 71 CCC 1822), it has been clear that the revised permanent disability rating schedule adopted January 1, 2005 applies to injuries sustained prior to January 1, 2005, UNLESS the injured worker can establish that one of the exceptions set forth in the third sentence of 4660(d) is applicable. This sentence reads: The revised schedule will apply to pre-January 1, 2005 injuries:
"when there HAS BEEN either no comprehensive medical-legal report or no report by a treating physicianindicating the existence of permanent disability, or when the employer IS not required to provide THE notice required by Section 4061 to the injured worker." (Emphasis added)
The principles of Aldi were reaffirmed in a published opinion from the Third Appellate District in Chang v. WCAB (7-24-07) 72 CCC 921.
This third sentence of 4660(d) has fostered much litigation over the last several years. Issues included the question whether a "comprehensive medical-legal report" could be any such report or only one which indicates the existence of permanent disability. Another major issue was: what does "is not required to provide the notice required by Section 4061" mean? But perhaps a bigger question was what does “indicating the existence” mean.
DEFINING THE EXCEPTIONS
On April 6, 2007, the WCAB issued two en banc (4-3) decisions addressing two questions. In the first of these,Baglione v. Hertz 72 CCC 444, the question analyzed was what kind of medical report had to be written before 1-1-05. Would “any” comprehensive medical legal report, e.g. L.C. 4060, suffice? The Board found that not just "any" comprehensive medical-legal report before 1-1-05 would suffice to trigger the 1997 Schedule. In the battle over "to comma or not to comma", it was determined that to invoke this exception, the medical-legal report must also "indicate the existence" of permanent disability.
Also on April 6, 2007, the Board issued its decision in Pendergrass v Duggan Plumbing 72 CCC 456. This case concerned the "notice required by Section 4061". Some had argued that the duty to provide a 4061 notice arose with the first payment of temporary disability indemnity. The argument continued that therefore if TDI was paid before 1-1-05, a 4061 notice was required before 1-1-05, and therefore the 2005 Schedule for Rating Permanent Disability should NOT apply. The majority disagreed. Where payment of temporary disability indemnity starts before 1-1-05 and continues until 1-1-05 or later, there is no requirement to provide a 4061 notice until the last payment of TDI is made, the majority stated:
"...[I]f the last payment of temporary disability indemnity was made for any period of temporary disability ending before January 1, 2005, then the 1997 Schedule applies to determine the extent of permanent disability, pursuant to section 4660(d), because section 4061 requires the employer to provide the injured worker with a notice regarding permanent disability "[t]ogether with the last payment of temporary disability indemnity ...," (Emphasis added)
The principles of Baglione and Pendergrass have been reaffirmed in two published cases. On May 23, 2007, the decision in Costco v. WCAB (Chavez) 72 CCC 582 issued from the First DCA. On July 24, 2007, the decision inEnergetic Painting v. WCAB (Ramirez) (7-24-07) 72 CCC 937 issued from the Third DCA. Also see W/D and non-published cases: Bryer (9-27-07); City of Galt (Ramos) (9-21-07); Lyngso Garden Materials v. WCAB (Ruiz) 72 CCC 1097; Zenith v. WCAB (Watts) 72 CCC 1135.
A couple of questions not addressed by any of these decisions are:
WHAT EXACTLY DOES “INDICATING THE EXISTENCE OF PERMANENT DISABILITY MEAN?
The first case decided by a DCA on this issue was Vera v.WCAB 72 CCC 1115. The court had concluded that a medical condition had to be permanent and stationary before there could be an "indication".
In an opinion from the 2nd DCA in Genlyte Group v. WCAB (Zavala), 73 CCC 6, certified for publication on January 3, 2008, that Court stated:
“[T]he Vera court’s conclusion miss[es] the mark. ... The language of the statute is not limited to what the Vera court properly describes as the typical final or permanent and stationary report....
[I]n an appropriate case a physician is not precluded from reporting that permanent disability exists prior to the time the injured worker (sic) has reached permanent and stationary status or the extent of ratable permanent disability is known....”
The Court went on to cite several circumstances where the existence of permanent disability may be indicated before the injured worker’s condition becomes permanent and stationary. These included cases of insidious and progressive occupational disease, or severe burns or loss of sight or limbs, or where the injured worker becomes entitled to vocational rehabilitation.
Several decisions since January 2008 have favored the Genlyte rationale over Vera while none have favored Veraover Genlyte. In fact, the Genlyte decision was considered a change in the law and "good cause" to reopen a ces previously decided based on Vera, Avila - Gonzalez 75 CCC 1069. See Tenet v. WCAB (Reddick) 73 CCC 329 (in 10-04, QME advised: P&S if no surgery; expected PD if surgery done); Virginia Surety v. WCAB (Wragg) 73 CCC 75 (In 12-04, PTP advised: Wragg "will be left with some measure of permanent residual disability and limited functional capacity resulting from said industrial injury.); Zenith v. WCAB (Cugini) 73 CCC 81 (On remand to WCAB, instruction to follow Genlyte rationale). There were also numerous Board Panel decisions following Genltye.
Prior to Genlyte, there were there were a variety of Board Panel decisions and Writ Denied cases with similar views as to the meaning of "indicating the existence of permanent disability". The following is a sampling of these and related earlier decisions. In a W/D of 6-14-07 in Xerox v. WCAB (Blair) (6-14-07) 72 CCC 1044, where there had also been a 4061 notice issued before 1-1-05, the WCJ found that a PR-2 reporting loss of cervical motion after surgery was "an indication" of the existence of permanent disability. Also, presumed medical-QIW status [L.C. 4636(c)] was another "indication". As for QIW status, see also Panel Decisions in Compton (8-14-06); Mancinas (3-8-06); andCamacho (11-20-05). In Zurich v. WCAB. (Nunes) (W/D 3-1-07) 72 CCC 368, the WCJ had used the 2005 Rating Schedule. On reconsideration, the WCAB determined that a medical report of 9-27-04 showing that the IW had a herniated disc, footdrop, used a cane, and needed surgery constituted an "indication" of the existence of PD, and therefore the 1997 schedule should apply.
What about a surgery already done prior to 1-1-05? In Owens (2007)(W/D) 72 CCC 148 and in Helm (2007)(W/D) 72 CCC 962, carpal tunnel surgery done in 2003 did not "indicate" PD, but in Conroy (BPD 10-13-06), the Board held that virtual ACL reconstruction surgery itself (done 10-21-04) was an indication of the existence of PD, in part, because there was some indication in the AMA Guides that such a procedure would probably result in ratable permanent disability. And in Santa Rosa School District v. WCAB (Hagle) (W/D 8-29-07) a total hip replacement done in 5-04 (which would yield a WPI of 15-30 under the AMA Guides) was determined a sufficient "indication" of the existence of permanent disability to apply the 1997 schedule even though the condition had not become P&S before 1-1-05. Also, in City of Vacaville v. WCAB (Lee) (W/D) 71 CCC 1853, when the PTP reported on 12-30-04 that indeed the IW would have permanent disability, but his condition would not become P&S for 2-4 months, the Board found this report to be an "indication", and the 1997 schedule applicable. On the other hand, in SCIF v. WCAB (Echeverria) 72 CCC 33, the Court of Appeal found the WCAB decision to apply the 1997 schedule not supported by substantial evidence where the PTP signed a statement prepared by the IW's attorney on 12-15-04, to wit: "I believe permanent disability is within reasonable medical probability emanating from this injury." Similary, in HSR, Inc. v. WCAB (Mariscal) (non-published 9-24-07), the Sixth DCA found a "check the box" report before 1-1-05 inadequate to establish an "indication".
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The California Third District Court of Appeal, following oral argument, granted Defendant County of Sacramento’s Petition for Writ of Review on a Labor Code section 3208.3 good faith personnel action defense argued by Elizabeth Trimm of the Sacramento office on April 22, 2013.
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Hanna Brophy Attorney Christian Kerry wins Appellate Court Decision - Labor Code §4850 benefits are subject to the 104-week cap set forth in Labor Code §4656(c)(2) County of Alameda (Knittel) v. WCAB - Read more about this significant victory for California public entities here.
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