State News : New Jersey

          The old adage is that New Jersey is a not a partial temp state, but is that really true?  In some states, likeNew Hampshire, an employee who returns to work but due to disability cannot earn the amount he or she was earning before the work injury may be eligible for significant benefits.  The adjuster may pay the employee 60% of the difference between pre- and post-injury earnings and that may continue for up to 262 weeks.  But this applies to a situationafter maximal medical improvement.  New Jersey clearly does not have any requirement like this becauseNew Jersey is not really a wage loss state:  it is a functional loss state which compensates injured workers after maximal medical improvement with dollars that correspond with the percentage of loss of bodily function.

             But what about this increasingly common situation? Ashley Franklin works for Krogers Inc. in the deli department. She earns $20 per hour for a 40-hour week.  She makes $800 per week.  She fractures her leg at work and is out of work for the month of January 2015, receiving $560 per week in temporary disability benefits.  Krogers offers Ashley a modified duty sedentary job for the month of February.  The workers’ compensation doctor restricts her to four hours per day, and she makes $400 per week, half her normal wage, for the month of February. She works half a day for four straight weeks. Ashley calls the adjuster and asks, “what about the other $400 per week I am losing?”

             Ashley reaches maximal medical improvement on March 1, 2015.  She contacts a lawyer about her loss of wages in February, complaining as follows: “When I was working the job, I was making $800 per week.  On temporary disability, I was getting $560 per week tax free.  Now I am working on modified duty, limited to half a day by my comp doctor, and I am earning less than I was on temporary disability -- and it’s all taxable!”

             This question comes up every month in this practitioner’s practice.  Which of the following should the claims examiner tell Ashley?

             A. “New Jersey does not have partial temp. You get nothing.”

            B. “We will pay you $160 weekly in temp benefits to get you to $560, your temp rate.”

            C. “We will pay you $280 in temporary disability benefits weekly, half of what you were paid while on temporary disability.”

            To answer this question, the practitioner has to studyN.J.S.A. 34:15-38. That is the section which explains how to pay temporary disability benefits.  The question is whetherNew Jersey compensates only for loss of whole days or fractions of days.  Here is what the statute says:  first you determine the first day that the employee cannot work due to the accident up to the first day the employee can return to work and continue at work.  In Ashley’s scenario that is 28 days.  Then you “subtract from the number the waiting period and any day and fraction thereof the employee was able to work during the this time, and divide the number by seven.”  The statute concludes, “the resulting whole number and seventh will be the required period for which compensation is payable on account of temporary disability.”

             The language of the statute is confusing.  On the one hand, it recognizes a partial loss of a day by saying “any day and fraction thereof the employee was able to work.”  That would suggest that Ashley has a valid claim for two weeks of temporary disability benefits because she lost 20 half days. On the other hand, the statute speaks in terms of the “resulting whole number and seventh.”  The intention of the legislature is arguably less than clear in reading this statute.

             There are no published decisions on this issue.  In fact, there is only one decision in the Division of Workers’ Compensation directly on point, namelySoto v. Herr’s Foods, Inc., 2012 NJ Work. Comp. LEXIS 4 (September 7, 2012).  That case also involved a situation where the injured worker was limited to four hours per day by the treating doctor while on light duty.  Mr. Soto was getting $683.31 per week on temporary disability but was returned to light duty earning a net payment of $329.43 per week, which was $353.88 less per week than he was earning on temporary disability.  The Honorable Emille Cox ruled in favor of the petitioner: 

It seems rather obvious to this Court that if Respondent is responsible for the payment of temporary disability benefits, and, in this case, the amount to which Petitioner is entitled is $683.31 per week, to allow Respondent to provide minimum light duty and only pay the Petitioner an amount less than $683.31 to which he is entitled defeats the purpose of both the temporary disability and the light duty provisions of the workers’ compensation statute.

             Judge Cox did not call thistemporary partial disability benefits.  His decision was not appealed, no doubt a wise decision by the employer.  The term temporary partial disability refers more to the example at the beginning where an employee returns to work on a full-time basis earning less than he or she earned before the injury well after maximal medical improvement.  The question in Ashley’s scenario is limited to payment before she reaches maximal medical improvement.  It is this:  is temporary disability defined in New Jersey to include only whole days lost or parts of days where the treating doctor will not allow the worker to work more than parts of days?

             In this practitioner’s experience, most workers’ compensation judges agree strongly with Judge Cox, and in fact most employers also agree that modified duty when limited to half days by the treating doctor should not result in a financial penalty to workers.  In other words, the employee restricted to working half a day by the workers’ compensation doctor should not see his or her compensation drop below the amount earned in temporary disability benefits.

 The general consensus is that something must be done in Ashley’s situation because it seems inequitable for her to earn less on modified duty half days than she was earning while out of work receiving tax free temporary disability benefits. Where there remains some difference in opinion is how much Ashley should be paid over and above the $400 in earnings for half days of work that she has lost. The way Section 38 reads in subtracting any day and fraction thereof that the employee was able to work suggests that if this issue gets to the Appellate Division, the Court would order the employer to pay 70% of the four weeks of half days lost by Ashley in the month of February.  That would mean she would get paid $280 per week in temporary disability benefits.  Every two days lost becomes one day of temporary disability benefits. Adding that to the $400 per week in earnings, she would be earning $680 per week.  Of that amount $400 per week would be taxable, putting her basically in the same position she was in while out on temp earning $560 per week. 

 In the end, New Jersey needs a published decision by the Appellate Division to resolve this issue.  Absent that, employers have to do what they perceive to be both consistent with the law and fair under the law. 

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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. 

Unlike many states, most settlements in New Jersey are paid out over a period of weeks, often with payments carrying out well into the future.  For example, if an employee receives an award of 40% permanent partial disability, the award is paid over 240 weeks in equal payments beginning with the last payment of temporary disability benefits.  When an employee seeks to accelerate those payments into one lump sum check, this is known as a commutation.  Permission must be obtained from the judge. 

 A recent case illustrates the issue.  Terrance Jenkins received an award of permanent disability benefits.  He applied to the lateVirginia Dietrich, Judge of Compensation, for the sum of $16,000 in commutation funds from the remaining award of $28,000, which was being paid in equal amounts over many weeks.  He contended that he wanted to open a small business selling fish and chips.  He testified in workers’ compensation court that he wanted to build on his mother’s current catering business.  However, he admitted that his mother’s business had few customers, and he needed to purchase equipment and supplies for the business.  Furthermore, he was in arrears on his rental payments for the business premises and needed to pay off his mother’s debts.

 Judge Dietrich reviewed the provisions ofN.J.S.A. 34:15-25. That section states,“Commutation is to be allowed only when it clearly appears that an unusual circumstance warrants a departure from the normal manner of payment and not to enable the injured employee . . . to satisfy a debt, or to make payment to physicians, lawyers or others.” Applying this standard, the judge rejected the request for commutation concluding that this “would be throwing good money after bad.”  She further found that the petitioner did not have a sound business plan and had managed to get over-extended financially.  

The Appellate Division affirmed the rejection of the commutation request because of the reasons provided byJudge Dietrich.  The case shows that it is really quite difficult to obtain a commutation inNew Jersey.  Very few requests get approved because judges look out for the best interests of employees.  This case may be found atJenkins v. L.A. Fitness, A-3570-12T2 (App. Div. February 4, 2015).    

 It is important for practitioners to realize that a commutation is improper when it is caused by the employer or carrier by mistake.  For example, suppose an employer or carrier is supposed to pay out an award over the next 52 weeks.  Due to a misunderstanding or computer error, the company pays the entire 52 weeks of future payments in one lump sum to the employee.  This amounts to a commutation, and it would be illegal because only a judge of compensation can approve a commutation.

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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. 

Janice Davis was injured on April 23, 2007 in a work-related accident.  She filed a claim petition promptly against Yassien Mobility Assistance & Ambulance, Inc., her employer.  On October 1, 2007, Yassien filed an answer stating that it had no insurance for workers’ compensation.  The Uninsured Employers’ Fund (UEF) was joined in the matter as an additional party. 

Yassien had previously obtained workers’ compensation insurance from Zurich American Insurance Company, which cancelled coverage in March 2006.  The accident happened over a year after the cancellation. 

Subsequent to these events, the Supreme Court of New Jersey held that cancellation of insurance policies will only be upheld if all aspects of the statute are strictly followed. N.J.S.A. 34:15-81 requires that the notice of cancellation be filed in the Office of the Commissioner of Banking and Insurance, together with a certified statement that the notice provided for in the statute has been given.  The Supreme Court of New Jersey in Sroczynski v. Milek, 197N.J. 36 (2008) stated that even a minor deviation such as not filing the certified statement will void the cancellation.

In this case, Zurich did not file the certified statement required underN.J.S.A. 34:15-81, but Yassien failed to argue this issue until 2013.  The workers’ compensation case dragged on for many years until Yassien on February 9, 2013 filed a motion to amend its answer to the claim petition to join Zurich as an additional party.  This was the first time Yassien formally contended thatZurich failed to properly cancel its policy in 2006. 

The Judge of Compensation ruled in favor of Yassien and held thatZurich failed to properly cancel the policy and would therefore have to pay the workers’ compensation claim. Zurich appealed and argued that Yassien waited far too long to raise this issue -- seven years, in fact.  The Appellate Division reversed and held thatZurich was correct in arguing that Yassien waived its argument for improper cancellation by waiting seven years. 

The Appellate Division reasoned that it would not be fair to carriers if employers could challenge proper cancellation many years after the cancellation occurred.  The Court noted that Yassien did not raise the improper cancellation argument in 2007 or 2008 before the Sroczynskidecision came down.   The Court suggested that if Yassien had raised this issue in 2007 or 2008, before theSroczynski case had been decided, its position would have been stronger.  By waiting until 2013 to raise the improper cancellation issue for the first time, Yassien waived its right to challenge the cancellation. 

The case can be found at Davis v. Yassien Mobility Assistance & Ambulance, Inc., A-0356-14T3 (App. Div. May 5, 2015). 

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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. 

          Cases dismissed underN.J.S.A. 34:15-54 for lack of prosecution are permanently closed if not reinstated within one  year.  The matter ofKost v. GPU Energy, A-0858-13T3 (App. Div. 2015) offers one exception to the rule.

             Richard Kost filed seven claims against GPU Energy/JCP&L in 2003.  He also filed a parallel civil action which was pending from 2003 to 2008.  Claimant’s attorney,Eric Lentz, left his law firm, Garces and Grabler, in March 2005.  Lentz kept the case and from time to time met withMr. Kost. 

             Problems began between the years 2005 and 2008.  Lentz failed to comply with several requests made by the Judge of Compensation, leading GPU to file a motion to dismiss for lack of prosecution.  That motion was granted in December 2008.  The rule provides that the claimant has one year to reopen the matter or the dismissal becomes final.

             On December 8, 2008, GPU’s attorney sent the order of dismissal to Lentz, who had not appeared at the hearing when the case was dismissed. Mr. Kost said he was never made aware of the dismissal.  He said he called his lawyer on numerous occasions but could not reach him.  Finally in January 2010, he reached his lawyer, who misled him into believing that the workers’ compensation cases were still active.  Lentz told Kost that the cases were progressing, and from time to time he asked Kost to sign medical authorization forms. The Appellate Division noted, “However, it is clear that Lentz hid from petitioner the true status of his cases.”

             In January 2010, Lentz scheduled an appointment for Kost to attend a permanency exam.  When petitioner got to the doctor’s office, there was no record of any appointment, nor any paperwork from Lentz.  Kost confronted Lentz, who assured him that the cases were progressing.  He never told Kost that his cases had been dismissed in December 2008.

             Kost retained new counsel, who figured out that the cases had been dismissed and attempted to restore the cases to the active list.  GPU argued that the one-year time period for reinstatement had passed.  The Judge of Compensation on September 16, 2013, refused to reinstate the case, and Kost appealed.  The Appellate Division was faced with the fact thatN.J.S.A. does not provide for any exceptions:

 Although N.J.S.A. 34:15-54 does not expressly create an exception to the one-year requirement for filing a motion for reinstatement, our courts have recognized that compensation judges possess the inherent power to excuse the one-year time bar upon the grounds set forth in Rule 4:50-1.

 The Court found that this was an exceptional circumstance. “Petitioner’s dilemma was not caused by his own dereliction or ambivalence. Instead, fault for the dismissal rests squarely on his prior attorney.  Here, petitioner made significant effort to keep in contact with Lentz.  He was affirmatively mislead, and assured his cases were still active.  It was not until new counsel took over in 2010 that petitioner was informed his cases were dismissed.”

             The Court also noted that GPU was not really prejudiced in this case because the company had obtained substantial discovery during the five-year period of the civil litigation. 

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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. 

In New Jersey, the PIP carrier has a right to file a workers’ compensation claim petition in the name of the injured worker, but there is a catch:  the PIP carrier is subject to the same defenses that the injured worker would be subject to.

 InHigh Point Insurance Company(as subrogor of Kevin Smith) v. Drexel University, A-2030-13T4 (App. Div. April 17, 2015), High Point Insurance paid personal injury protection benefits for injuries suffered by Kevin Smith, a Ph.D. student and Teaching Assistant at Drexel University.  On September 2, 2011, Smith drove aDrexel University vehicle to a site in the Pine Barrens inNew Jersey to conduct research for his graduate dissertation.  While driving back toDrexel University, Smith was injured in a car accident.

High Point sought reimbursement of the PIP benefits it paid to Smith by filing a claim petition in the Division of Workers’ Compensation.  Smith himself never filed a claim petition on his own behalf. Drexel University answered the claim petition with a denial.

The Judge of Compensation observed that the Ph.D. program Smith was enrolled in at Drexel did not require that he work as a Teaching Assistant.  Smith decided to accept that position in an attempt to offset the cost of the Ph.D. program.  The Judge felt that Smith was using the Drexel vehicle to reach thePine Barrens for his own personal research, not in his role as a Teaching Assistant.  The Judge also noted that there were no classes in session the week of the accident. Judge of Compensation dismissed the workers’ compensation claim petition commenting that High Point never proved any requirement that Smith travel to thePine Barrens for his work. 

On appeal, High Point argued that Drexel “entwined” Smith’s personal graduate studies and teaching assignments to a degree that traveling for his research became work related.  The Appellate Division rejected High Point’s reasoning and held that there was no connection between the accident and Smith’s employment.

The case illustrates a number of interesting procedural points.  The New Jersey Division of Workers’ Compensation is open to a variety of claims by PIP carriers.  A PIP carrier can intervene in an existing litigated claim in the Division of Workers’ Compensation for reimbursement of benefits the carrier has paid.  In addition, the carrier can also file a claim petition in the name of the injured party,even if there is no existing claim petition.  Getting cooperation from the injured party can sometimes prove difficult, but in this case Smith agreed to cooperate and testified.  The problem which High Point had was that it could not show that driving the Drexel vehicle was related to the Teaching Assistant job.  It was more of a personal mission related to Smith’s research for his Ph.D.   

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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. 

        Sometimes the seemingly minor cases have significant long-term impact.  The case ofAmedeo v. United Parcel Service, A-1013-13T2 (App. Div. April 8, 2015) may be one of those cases. 

          Thomas Amedeo suffered a work injury in 2009 in the employment of UPS.  He filed a workers’ compensation claim petition and ultimately received an award of 30% partial permanent disability.  He timely reopened the case in October 2012 and sought by way of motion an order requiring UPS to assign an orthopedist to treat him for a degenerative hip condition.  Petitioner relied in his motion on a report fromDr. Frederic Brustein, an internist and physiatrist.  Dr. Brustein stated in his report that he himself would not treat petitioner but that petitioner should seek out other specialists such as university affiliated orthopedists specializing in the hips, the spine, and pain management. 

          UPS arranged an IME with Dr. Joseph Corona, who said that Amadeo had reached maximal medical improvement and there was no increase in his disability. He found no need for further treatment.

          The case was listed on a motion hearing on October 4, 2013.  Petitioner’s attorney requested an adjournment.  The Judge refused that request, noting that petitioner’s attorney had failed to appear on several occasions.  Respondent’s counsel and an attorney covering for petitioner’s counsel appeared and conferenced the case with the judge.  Petitioner himself did not appear at the motion hearing. 

          The Judge of Compensation dismissed the motion hearing without prejudice.  She determined that the motion papers were insufficient and advised petitioner’s attorney of this opinion.  She also noted that no hearing could take place without the petitioner.  The Judge determined that the motion papers were deficient under N.J.A.C. 12:235-3.2(b)(2).  Dr. Brustein did not state the specific type of treatment being sought; nor wasDr. Brustein the proper physician to advance the motion since he could not treat petitioner himself as a physiatrist and internist.   AllDr. Brustein did was say that petitioner should seek out other specialists. 

          Petitioner appealed the dismissal of his motion.  The Appellate Division agreed with the Judge of Compensation, stating that the regulation noted above was designed to eliminate non-specific reports by requiring applicants to provide detailed opinions from qualified experts. 

Here, we agree with the judge of compensation that petitioner failed to provide evidence adequate to present a prima facie case in support of his motion.  Specifically, Dr. Brustein’s report did not recommend a definite course of treatment, state that petitioner needed a particular medical treatment, or sufficiently support a referral to a specialist. Rather, Dr. Brustein’s report ‘merely suggested several options for other specialists to try.’

          The Appellate Division also rejected the petitioner’s request that the case be assigned to another judge.  This decision is likely to change the way practitioners file motions and the way respondents defend them.  It is quite common for claimants to retain doctors in support of treatment motions who themselves cannot treat or lack the specific qualifications to treat.  Instead, they will recommend treatment by otherdoctors-to-be-named. The Amedeo case puts the onus on the applicant to retain the appropriate physician from the outset, which will also allow employers to adequately respond to such motions.    

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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. 

SCENARIO ONE: An employee has a preexisting arthritic knee condition that his personal physician says will require imminent knee replacement. Three months later this employee steps off a truck at work feeling pain in the knee.  He reports the incident to his employer, who sends him for treatment.  The doctor orders an MRI, stating that he feels that the employee needs a total knee replacement. The doctor writes that this incident “aggravated” the prior knee condition.

SCENARIO TWO: An employee has suffered with severe back pain for many years, treating unsuccessfully with many surgeons and has been informed she will have to live with the pain or get surgery. The employee is pushing a cart at work one day and feels pain in her back.  She sees a workers’ compensation doctor, who orders an MRI showing extensive spondylolisthesis.  The doctor states that this incident “aggravated the back condition.”  The employee now agrees to undergo fusion surgery.

Should the employer be paying tens of thousands of dollars for surgery and eventual permanency in these two scenarios? These are very common occurrences, but is there a common understanding of the term “aggravation?”  Does it mean one thing to doctors and another thing to workers’ compensation practitioners? In this writer’s experience, doctors often mean something completely different than attorneys. One thing is clear:  if the treating doctor says that the work incident aggravated a prior condition, the Judge of Compensation will require the employer to pay for surgery and for permanency.

So the ultimate answer in both scenarios above depends on what the legal definition of aggravation is.  In both cases, the employee had been told of the need for surgery before any incident at work.   If the authorized doctor means that the work activity simply caused “more pain” on a temporary basis with no real change in the underlying condition, then no, the employer should not be paying for surgery or permanency.  Nonetheless, employers pay for these kinds of surgeries over and over again because the treating doctor says that work “aggravated” the prior condition.  

There are two main reasons that workers’ compensation costs are overpaid in New Jersey, and for that matter, in most states: one is the lack of understanding of the legal definition of “aggravation,” and the other is the failure to take a detailed past medical history. A good explanation of what aggravation means comes from the case of Peterson v. Hermann Forwarding Co., 267 N.J. Super. 493 (App. Div. 1993),certif. denied, 135 N.J. 304 (1994

In the Peterson case, the employee suffered a traumatic accident on October 1, 1982 getting out of his truck.  He missed a month of work and could no longer return to work with his company, which had ceased operations.  He obtained employment four months later with another trucking company.  He drove back and forth to New Jersey, stating that “empty trailer bouncing” caused his right leg to get numb.  He said he had to bend down in a squat position, which hurt his back.  He also said his neck would stiffen up as well.  He left this company, Mid-Florida, because the hours were too long.  Then he worked for four more trucking companies.  The last trucking company he worked for was Yellow Freight, where he worked only six days.  He ultimately found that the pain levels were intolerable, so he stopped working in June 1984 and never worked again.  He brought claims against all the trucking companies, and the Judge of Compensation found that the last employer was responsible for total disability because the work there aggravated his prior back condition.

On appeal the Appellate Division reversed, stating that all the areas of the body which hurt petitioner while working in these subsequent employments were the same areas he originally injured in 1982. “Clearly, because of his pre-existing conditions, petitioner’s work activities at the subsequent employment caused him to suffer greater pain than he would have experienced had he remained sedentary.  However, an employer is not required to compensate an employee for pain.  There must be proof of a work related injury or condition resulting in permanent disability.”

The court also added the following:  “While the work efforts of petitioner in this case may be considered strenuous by some, they were not unusual for petitioner’s line of work.  It was what he would have been able to do but for the October 1982 accident.” Another case which clarifies the need for objective evidence of worsening to satisfy the definition of aggravation isKozinsky v. Edison Products Co., 222 N.J.Super. 530 (App. Div. 1988).

While Peterson was an occupational aggravation case, the logic that the court employed is important to appreciate.  The pain petitioner was complaining of at trial was the pain he had experienced all along, and there had been objective change over the years. N.J.S.A. 34:15-36 only requires an employer to pay partial permanent disability if the work injury produces objective changes which either cause a lessening to a material degree of working ability or a substantial impairment of non-work activities.

Practitioners should ask doctors not whether the work conditions “aggravated” the prior condition but whether there is any objective change from the prior condition -- or just a temporary increase in pain.  In other words, if one compares the prior MRI with the new MRI, and there is no change, there is no aggravation.  There may be some temporary increase in pain, but pain is subjective.  If there is a difference in the MRI results showing a worsening of the condition, then the employment activities will be found to have aggravated the prior condition.

As a practical matter, anyone who has a long-standing painful back or knee condition knows that almost any physical activity can cause a temporary increase in pain.  For a person with an advanced arthritic knee condition, even the act of walking can cause swelling and pain.  But a temporary increase in pain is not aggravation under the law.  Employers end up picking up enormous medical and indemnity costs mainly because treating doctors misunderstand the legal definition of aggravation, causing general health care costs to be passed through workers’ compensation.

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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. 

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

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

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

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

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

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

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

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John H. Geaney, Esq., is an Executive Committee Member and a Shareholder in Capehart Scatchard's Workers’ Compensation Group.  Mr. Geaney concentrates his practice in the representation of employers, self-insured companies, third-party administrators, and insurance carriers in workers’ compensation, the Americans with Disabilities Act and Family and Medical Leave Act. Should you have any questions or would like more information, please contact Mr. Geaney at 856.914.2063 or by e‑mail at jgeaney@capehart.com. 

             There have been a number of developments in the Division of Workers’ Compensation in 2015 of which practitioners should be aware:

            Retirement of Director Peter J. Calderone,

            After 13 years of service as Director of the Division of Workers’ Compensation and 39 years of service to the State of New Jersey, Chief Judge and Director Peter J. Calderone announced this week that he will be retiring effective February 28, 2015.  Director Calderone raised the level of professionalism within the Division and modernized the New Jersey workers’ compensation practice, with e-filing of pleadings, court listings and communications from counsel to the courts.  He led the creation of an extensive case management system and developed a first class Division website providing a wide range of valuable information to practitioners and the public.   During his tenure, rules for discovery on urgent motions for medical and temporary disability benefits were established, and new administrative rules were adopted for medical reimbursement petitions, thousands of which are now handled in the Division. 

            The new Director of the Division of Workers’ Compensation will be the Honorable Russell Wojtenko, Jr., Supervising Judge of New Brunswick vicinage.  Judge Wojtenko resides in Mercer County and currently sits in New Brunswick.  He has earned a reputation in the bar as  hard working and fair to all parties. 

            Three New Workers’ Compensation Judges

             The Governor has nominated three experienced practitioners as workers’ compensation judges: Michael J. Dillon, Esq., Thomas J. Ludlum, Esq. and John C. Gavejian, Esq., all from Bergen County.

             2015 Rate Charts Are Available

             For clients who are interested in receiving 2015 rate charts, please email the undersigned or Carol Wright atcwright@capehart.com.  The maximum rate for temporary disability benefits and total permanent disability benefits is $855 per week, up from $843 per week in 2014.  That amounts to approximately a 1.5% increase over last year.

            The minimum rate is now $228 per week.  The current state average weekly wage on which the rates are based is $1,140.02 per week. In 2005 the maximum rate was $666 per week and the minimum rate was $168.  In 1995 the maximum rate was $469 and the minimum rate $125.  In the past 20 years the maximum and minimum rates have increased 82%.

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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. 

 A number of clients have inquired recently whether claimants in workers’ compensation cases have a right to request their treating medical records from the insurance carrier, third party administrator, or the authorized treating physician.  The answer to this question comes from both the New Jersey Workers’ Compensation Act and from the rules of the New Jersey Medical Society.

 N.J.S.A. 34:15-128.4 provides that it is unlawful for an employer, the carrier or the treating physician, or a third party in the case or their agents “to withhold from the individual any medical information they have regarding that individual which is requested by the individual, and if an individual requests the medical information, the individual shall not be charged fees in excess of the cost of providing copies of the information.”  In other words, a claimant has a right to medical information from any party to a workers’ compensation case.  That includes the treating medical provider. 

Authorized workers’ compensation physicians owe the same obligation to a treating claimant as they would to a private patient.  The mere fact that the employer has designated the treating doctor and pays for the care in no way changes the doctor-patient relationship in a workers’ compensation case.

The rules of the New Jersey Medical Society are similar.  Under N.J.A.C. 13:35-6.5, the treating medical provider must provide patient records no later than 30 days from the receipt of a request from the patient or an authorized representative.  The records must include objective data such as test results and x-ray results.  The rules go on to say that when a patient has requested the release of medical records to a specified individual or entity, the physician shall secure a written medical authorization to protect the privacy interests of the patient. 

The Board of Medical Examiners also provides that the cost of reproducing such records shall not be greater than $1.00 per page or $100 for the entire records, whichever is less.  If the records are less than 10 pages, the medical provider may charge $10 to cover postage and associated costs related to the retrieval of such records.  Medical providers shall not charge for a copy of the patient’s records when the physician has effectively terminated a patient from practice in accordance with the requirements of N.J.A.C. 13:35-6.22.

It is important to understand the difference between a treating physician and a independent medical examiner.  Because there is no physician-patient relationship in a situation involving an independent medical examination, a physician who is performing an IME does not have to provide a copy of such a report to the examinee.  That report is sent to the party which requested it, usually the carrier, third party administrator or counsel. 

The rule regarding disclosure of treating medical records between counsel is contained inN.J.A.C. 12:235-3.8 (c), which states that either party must furnish medical information to the other within 30 days of the receipt of a demand for such records.  Usually the employer or its carrier/third party administrator has the treating records, and in that case those records must be made available to petitioner’s counsel or petitioner on request.  If the petitioner has obtained treatment on his or her own, then the same obligation rests on petitioner to provide such records to the employer on request.  If a party is not responding timely to a request for medical information in a litigated case, the appropriate step is to file a motion in the Division of Workers’ Compensation. 

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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.