State News

Angel Richards v. Creston Nursing & Rehabilitation Center, Court of Appeals of Iowa, No. 2-1017 / 12-1120

The Claimant began working as a CNA with the defendant in October of 2005. Prior to this, the Claimant had a history of back pain starting in 2002. On February 13, 2006, the Claimant alleged a back injury that occurred while she was moving a patient. She sought medical attention that day and returned to light duty four days later. According to the attending physician she was fully recovered on February 27, 2006.

The parties stipulated that the Claimant again injured her low back while assisting a resident out of bed on October 10, 2006. She saw Dr. John Hoyt who gave her epidural injections, muscle relaxers and physical therapy. She was then assigned to half days with no lifting but continued to experience some radiating right leg pain.

In early December 2006, Dr. Hoyt increased claimant’s restrictions to being able to lift 50 lbs. The Claimant then apparently aggravated her back while cleaning tables in late December at work. She was then seen by Dr. Lynn Nelson, an orthopedic surgeon, in January. An MRI taken at this time revealed that the claimant had very small disc bulges at L4-5 and L5-S1, however she was not experiencing a significant degree of impingement. Dr. Nelson opined that no surgery or injections were necessary; but did limit the claimant to office work and a 15 lb lifting restriction.

In January 2007, the Claimant slipped in the defendant’s parking lot and was again seen by Dr. Hoyt. Dr. Hoyt found the claimant’s symptoms to be improving. Then in February of 2007, the claimant was fired for excessive absenteeism. Soon thereafter, the Claimant was discharged from Dr. Hoyt’s care in March of 2007. She was briefly employed as a telemarketer in June, but then left to care for her father in law. Once he was improved, the Claimant began as a CNA at Crest Haven Care Center in January of 2008. At her pre-employment physical the Claimant was reported as being pain free in regards to her back. She worked without restrictions at Crest Haven and ultimately left her employment there due to circumstances unrelated to her back.

In April of 2008, the Claimant began working as a cashier at Kum & Go. In August of 2008, the Claimant fell in the Kum and Go parking lot. She saw Dr. Gerdes complaining of severe tail bone and back pain. She was diagnosed with acute lower back spasm and returned to work a week later with lifting restrictions. In September of 2008, the Claimant reported another fall at Kum & Go. An MRI taken revealed mild degenerative disc disease at L4-5 and L5-S1 with annular disc bulges, but no other maladies.

Kum & Go denied the claimant’s workers compensation claim stemming from this September fall as there was no significant difference in her MRI results from 2007 as to 2008. The employer also suspected the Claimant may have lied about the fall to obtain time off from work.

In November of 2008, the Claimant sought an IME with Dr. Robert Jones. Dr. Jones attributed the claimant’s pain primarily to her October 2006 injury. He opined that her improving symptoms did not mean the injury had completely resolved, but could not apportion a percentage of pain between her CNRC injury and the fall at Kum and Go. He assessed the claimant to have 5% permanent impairment causally related to the two injuries.

The Claimant was fired from Kum and Go in October of 2008 for unexcused absenteeism. She has been unable to find work since. The Claimant filed the current workers’ compensation action against CNRC in April of 2009. In connection with the claim, Claimant’s counsel wrote to Dr. Nelson for his opinion as to whether the Claimant’s injury was caused by her incident at CNRC or the fall at Kum & Go. Dr. Nelson ultimately opined that the claimant’s incident in October of 2007 did not result in permanent impairment.

At the claimant’s deposition she testified that she had trouble sitting as well as using stairs due to her low back pain. Video surveillance conducted of the claimant showed her ascending and descending stairs with no problem. The deposition and surveillance footage, as well as claimant’s medical records, were provided to Dr. Jones to obtain his opinion on causation. He continued to opine that the claimant’s 2006 nursing home injury was a significant causative factor in the claimant’s current complaints.

After the arbitration hearing, the deputy issued a ruling which found the claimant failed to carry her burden of proof that her work injury caused her permanent impairment. The conclusion was based largely on the claimant’s lack of credibility while testifying. The deputy also found Dr. Jones had relied on a very suspect history in rendering his opinions. The opinion of the deputy was adopted by the commissioner which was affirmed on appeal as being supported by substantial evidence.

The case was then appeal to the Court of Appeals. The Court first noted that its review would be based upon the substantial evidence standard as the case was based upon factual determinations which were vested in the agency’s discretion. The Claimant challenged the findings of the agency in regards to the Claimant’s credibility and the discounting of the opinion of Dr. Jones. In regards to the Claimant’s credibility, the Court found that even despite possible overstatements by the deputy in regards to the claimant’s tendency to deceive, the determination regarding credibility withstood a substantial evidence challenge. This was based upon numerous inconsistencies in the claimant’s testimony, both in her deposition and at hearing.

The Court then turned its attention to the issue of Dr. Jones’ opinion regarding causation. The Court found that the deputy had explained his reasoning for discounting the opinion of Dr. Jones as it was based upon the claimant’s statements which were found to lack credibility, and as such was relying upon a suspect history. The Court opined that it was within the purview of the deputy to weigh expert opinion testimony and the deputy did not abuse his discretion in finding the opinion of Dr. Jones’ unconvincing. As such, the Court affirmed the findings of the deputy.

Mercy Hospital Iowa City and Cambridge Integrated Services v. Susan Goodner, Court of Appeals of Iowa, No. 2-933 / 12-0186

 The Claimant was a family practice physician who treated two patients with mono in January of 2000. On January 18^th, one of those patients vomited on the claimant’s hands during the examination. The Claimant began experiencing symptoms on February 4^th and when they did not subside she performed a mono spot test on February 13 which came back positive.

The Claimant sought medical treatment from Dr. Wools-Kaloustian, an infectious disease specialist who diagnosed the claimant with mono. On February 25^th, the claimant reported her illness to her employer and remained off work or worked reduced hours due to extreme fatigue.

The Claimant was eventually referred to Dr. Minner by the workers’ compensation carrier in July of 2000 to determine if there was a work-related condition and if further treatment was necessary. Dr. Minner found the infectious disease to be causally related to the claimant’s employment and referred further care to Dr. Ovrom. Dr. Minner also opined that the long term prognosis for complete recovery was good.

In November of 2000, the Claimant was seen by Dr. Gervich for a second opinion at the request of the claimant’s private disability company. Dr.Gervich expressed doubt that the Claimant ever contracted infectious mononucleosis, though he could not disprove it. This was based upon the incubation period of the claimant’s disease. Dr. Minner subsequently referred the Claimant to Dr. Wesner, a psychiatrist, due to possible depression. Dr. Wesner diagnosed the claimant with depression which was related to the chronic fatigue syndrome following her infection. She was referred to individual and family therapy which he believed were reasonable and necessary treatment for her major depressive disorder and the chronic fatigue syndrome.

The Claimant’s symptoms of fatigue waxed and waned over the next few years and she continued to see Drs. Ovrom, Wesner, and Minner. Dr. Ovrom’s initial diagnosis was post viral fatigue, but he revised his diagnosis in April of 2002 because he believed Goodner’s condition met the criteria for chronic fatigue syndrome, and recommended consideration of permanent partial disability. On July 24, 2002, Dr. Minner placed the claimant at MMI. At that time Goodner was able to work twenty hours per week and was “overall at approximately 70% of full-time productivity.” Dr. Minner retired soon thereafter and care was transferred to Dr. Buck.

The Claimant first saw Dr. Buck in October of 2002. Dr. Buck concurred with Dr. Minner’s assessment of maximum medical improvement, stating, “Clearly her condition has and will continue to have mild episodic relapse, but the overall pattern has been quite stable now for some time.” He anticipated her needing periodic care with both Dr. Wesner and Dr. Ovrom, and he authorized additional visits with both providers. At his deposition, Dr. Buck stated that he believed there was a significant possibility that the Claimant had never contracted mono.

In November of 2002, the claimant was seen by Dr. Meier for a second opinion. She was diagnosed with chronic fatigue syndrome triggered by infectious mononucleosis. He further opined that he did not believe the claimant had reached MMI as her condition remained in a state of flux. Goodner underwent a series of studies including a sleep study, hormonal study, and immune disorder study at the prompting of the board of medical examiners. These studies came back normal, ruling out other conditions causing the fatigue.

The Claimant gained approximately thirty-three pounds during the course of her illness. She attributed this weight gain to her fatigue as she was unable to exercise regularly or plan healthy meals. She also developed type 2 diabetes, high cholesterol, and hypertension. She sought assistance from a weight loss clinic. When her attempts to lose weight were unsuccessful, she underwent bariatric surgery in May of 2007.

In October of 2008, the claimant was referred to Dr. Pocinki, an expert on fatigue syndrome. It was Dr. Pocinki’s opinion that the claimant met all the criteria for chronic fatigue syndrome, and he believed the condition was triggered by the mononucleosis infection. He determined she was not yet at maximum medical improvement and anticipated it would be another two to three years before she would achieve this state.

The claimant was then seen by Dr. Risk, for an independent medical exam at the request of her attorney in February 2009. Dr. Risk opined the claimant developed post viral fatigue syndrome as a result of her exposure to mononucleosis. Although her obesity predated her symptoms, her subsequent fatigue lead to inactivity and poor diet. This condition resulted in her gaining the additional weight and developing diabetes, hypertension, and high cholesterol. He also believed the fatigue led to depression. He did not believe she was at maximum medical improvement at that time.

At the request of Mercy Hospital, a records review was performed by Dr. Katz. He opined that while the claimant may have a fatigue syndrome, the fatigue did not develop from mononucleosis, and he did not believe she contracted mononucleosis at all. He stated the likelihood of contracting mononucleosis in the way the claimant described was essentially zero. He also asserted the incubation period reported in the claimant’s case, seventeen days, was out of the question for this virus, which has a typical incubation period of forty to sixty days. He also stated the claimant’s clinical symptoms did not fit with infectious mononucleosis, which in older patients is typically characterized by a prolonged fever and liver involvement. Finally, it was Dr. Katz’s opinion that there was no specific concrete connection as to the cause of chronic fatigue syndrome; therefore, he doubted the causal link between mononucleosis and chronic fatigue syndrome.

Dr. Lutz also performed a records review at the request of Mercy Hospital. Like Dr. Katz, Dr. Lutz opined, in his March 2, 2009 report, there is no medical literature support for the way Goodner claims the mononucleosis virus was transmitted to her. He also found the incubation period in this case was too short for mononucleosis, which typically has an incubation period of one to three months.He asserted the claimant’s case likely was the result of “VIP syndrome” where a physician treats a patient differently when the patient is an important person such as a doctor. Dr. Lutz believed this was why no initial treating doctor tested for mononucleosis, but just accepted her description and self-diagnosis. He states that her treating providers assumed causation in this case rather than establishing it based on her history. He also opined that there was no data to support a viral cause of chronic fatigue syndrome as the cause of chronic fatigue is unknown. Finally, he was concerned with the level of medications the claimant was taking, because many of the medications could be the cause of her fatigue and have a sedating effect.

Finally, Mercy Hospital had Dr. Stutts conduct a psychiatric evaluation of the claimant in January 2009. After conducting a review of the medical records and a patient examination, Dr. Stutts recommended that the claimant discontinue many of the medications she was on because he believed the medications were contributing to her chronic fatigue syndrome in a significant fashion and likely perpetuating her problems. Dr. Stutts believed the psychotropic medication had so muddied the water that he could not tell if the claimant had chronic fatigue or if the symptoms were caused by the medication.

The Claimant’s employment status during this time was quite up and down. Ultimately the claimant took a full year off from practicing medicine in 2006 on the advice of her treating physicians. The Claimant stated this year off greatly helped her and she returned to practice at a clinic in Kalona, Iowa. However she was forced to resign this position in January of 2008 due to fatigue.She was advised by the medical board to stop seeing patients, and her medical license was placed on inactive status by mutual agreement in January of 2008. For the claimant to once again practice medicine, her treating physicians would need to recommend to the board of medicine that her license be reactivated, she would need to present a plan for how she would see patients without becoming fatigued, and the board would need to approve her plan.

The Claimant initially reported her workers’ compensation claim in February of 2000. The claim was accepted, and treatment and benefits were provided with no agency intervention until September of 2006. At that time the claimant filed a petition for alternate medical care asking the workers’ compensation commissioner to order Mercy Hospital to pay for physical therapy for strengthening and conditioning, and massage therapy for muscle aches. At hearing, counsel for Mercy Hospital admitted liability for the claimant’s February 2000 injury. Counsel also admitted that the claimant had a case of chronic fatigue syndrome “that has been accepted as a work injury.” During the hearing, Mercy Hospital agreed to provide the physical therapy requested, but asserted the massage therapy prescribed by Dr. Ovrom was “not causally related to the work injury.” The deputy commissioner authorized the care requested.

The claimant filed an arbitration petition with the agency on May 18, 2007, alleging she was permanently and totally disabled as a result of her work injury, which developed on February 4, 2000. On February 18, 2009, after consulting with Drs. Katz and Lutz, Mercy Hospital amended its answer to generally deny the injury. After hearing, the deputy issued a ruling finding Mercy Hospital judicially estopped from contesting liability for the injury due to the position Mercy Hospital took at the alternate care proceeding.

The deputy went on to conclude the claimant sustained an injury in the course and scope of her employment and that the chronic fatigue syndrome was causally related to that injury. The deputy commissioner found Mercy Hospital responsible for one-half of the cost of the family counseling ordered by her treating physicians. He also ordered Mercy Hospital pay the full cost of the bariatric surgery after concluding, “there is no evidence in the record that claimant ever had any weight problem before her exposure to [the virus].” The deputy finally concluded that the injury caused the claimant to be permanently and totally disabled as an odd-lot employee because her injury made her unable to perform work “that her experience, training, education, intelligence, and physical capabilities would otherwise permit her [to] perform.”

The findings of the deputy were adopted by the commissioner on appeal. The district court then affirmed the agency’s decision did not preserve error on its claim nor did it prove the agency acted irrationally, illogically, or without justification in finding Mercy Hospital should be judicially estopped from contesting liability for the injury after having admitted liability in the alternate care petition. The district court also found substantial evidence supported the findings of the agency. The case was then appealed to the Court of Appeals.

The Court first opined that the decision of the agency in regards to judicial estoppel would be reviewed de novo and the Court was free to substitute its interpretation of the law for that of the agency. The issue of whether the medical evidence supported the finding that the claimant contracted mono resulting in chronic fatigue syndrome would then be reviewed according to the substantial evidence standard as question of medical causation is a fact question vested within the purview of the agency. As to whether the claimant was permanently and totally disabled, this would be reviewed based on the irrational, illogical or wholly unjustifiable standard as it involved the agency’s application of law to the facts which is vested within the discretion of the agency.

The Court first took up the issue of whether Mercy Hospital was estopped from contesting liability for the claimant’s injury based upon its position at the alternate care hearing. The Court first looked to the established precedent fromWinnebago Industries, Inc. v. Haverly, which stated that an employer cannot change its position regarding liability subsequent to an alternate medical hearing barring a significant change in facts after the admission of liability. The Court stated that it could not overrule the holding inHaverly as it was Iowa Supreme Court precedent. The Court then took up the next argument of Mercy that the holding inHaverly had been limited by subsequent case law.

Mercy argued that a case known asTyson Foods, Inc. v. Hedlund, limited the application ofHaverly in this case. In Hedlund, a claimant had mistakenly filed an alternate care petition to which the employer had admitting liability. Once the claimant realized the mistake, the petition was dismissed. The claimant then later filed a second alternate care petition in which the employer denied liability. The Supreme Court held thatHaverly did not have preclusive effect in this instance as the deputy had not decided the first petition based on the admission of liability by the employer and as such it was a nonevent. In the present case, the Court differentiated the facts from those in Hedlund and found thatHedlund did not apply to the current situation as the deputy had accepted the admission of Mercy Hospital in ruling on the alternate care petition.

Mercy also tried to argue that Haverly should have no effect on the current situation as the alternate care petition was filed prior to the contested case proceeding (the alternate care petition in Haverly was filed after the contested case proceeding began). The Court found no merit to this argument as the doctrine of judicial estoppelis intended to prevent a party from asserting a position in a subsequent proceeding that is inconsistent with its position in a prior proceeding.

Mercy next argued that the exception applied in this case as there had been a significant change in facts based upon Mercy’s receipt of the opinions of Dr. Katz and Dr. Lutz which caused them to change their stance on liability. The Court found that the agency appeared to have rejected the “significant change in facts” exception on the basis that Mercy Hospital could have obtained the medical opinions from Drs. Lutz and Katz earlier. The Court did not further address the issue as to whether the exception applied in this case as the Court found the agency also decided the case on the merits, thus dodging the issue as to whether the exception applied in this case.

After its discussion of the issue of judicial estoppel, the Court next turned its attention to whether the medical evidence supported the findings made by the agency. The Court in finding that substantial evidence supported the findings of the agency articulated that it was within the purview of the agency, under Iowa case law, to determine how much weight to give to an expert opinion. It was not for the Court on appeal to reweigh the evidence which was considered by the agency. The Court could only determine whether or not substantial evidence supported the findings made. The Court opined that several of the claimant’s treating physicians testified, based on their knowledge and experience the mechanism of injury, the incubation period, and the causal connection between mononucleosis and chronic fatigue syndrome all supported a finding that the claimant suffered a work-related illness—mononucleosis—and her current condition—chronic fatigue syndrome—was causally related to work; thus substantial evidence supported the findings made.

The Court then took up the issue as to whether the claimant was permanently and totally disabled. The Court noted that Mercy Hospital claims the claimant in her deposition admitted that if she exercised and did the right things she would regain the ability to work at least part time as she had from the onset of her illness until quitting her job at the clinic in 2008. Mercy Hospital argued that the agency cannot award total disability to a claimant who admits she can take action to return to work, but refuses to do so. The Court found this argument appealing but noted that the expert testimony supported the finding of permanent and total disability.

The Court noted that the finding of permanent disability was based upon claimant’s classification as an odd lot employee. The Court opined that an odd-lot employee is totally disabled if “the only services the worker can perform are ‘so limited in quality, dependability, or quantity that a reasonably stable market for them does not exist.’” The Court then stated that even assuming the claimant was able to obtain her license to practice medicine again and could practice medicine part time if she “exercised and did the right things” as Mercy Hospital contends she should do, this does not foreclose the agency’s determination she is an odd-lot employee entitled to an award of permanent total disability. The Court noted that the agency gave greater weight to the claimant’s vocational expert than Mercy’s and the Court would not disturb that on appeal.

The final issue addressed by the court was whether the agency erred in ordering Mercy to pay for the Claimant’s bariatric surgery and family therapy sessions. The Court first examined the issue of the bariatric surgery and determined that it was unauthorized care for an accepted injury; which meant that for Mercy to be responsible for paying for this care the Claimant had to show that it was both reasonable and beneficial. In reaching this conclusion, the court had to first determine whether the liability position of the employer at the time the treatment was sought controls or if it is when the claim is fully presented to the deputy (as Mercy had changed their position to full deny compensability, this would mean the claimant would only have to establish compensability for the injury and reasonableness of treatment). Ultimately, the Court found that the liability position at the time treatment is sought controls. Therefore, because Mercy Hospital had accepted the injury and maintained control of the medical care at the time the claimant obtained the bariatric surgery, she must prove the treatment was both reasonable and beneficial.

In deciding the issue as to whether the care was reasonable and beneficial, the court stated T]he concept of ‘reasonableness’ in this analysis includes the quality of the alternative care and the quality of the employer-provided care.” It includes “the reasonableness of the employer-provided care, and the reasonableness of the decision to abandon the care furnished by the employer in the absence of an order from the commissioner authorizing alternative care.” Id.The medical care is “beneficial if it provided a more favorable medical outcome than would likely have been achieved by the care authorized by the employer.”

The Court ultimately found that Based on the record before it, they were unable to conclude substantial evidence supports the determination that the weight-loss surgery was both reasonable and beneficial to the work-related injury. There is no employer-provided care in order to compare the reasonableness of the alternative care sought. This is not a case where an employee abandoned the care provided by the employer to seek alternative care as a result of a disagreement of her diagnosis or treatment. Most importantly, the Claimant had not made a successful return to the labor market following the bariatric surgery and has instead been found to be permanently and totally disabled. The surgery therefore could not be said to have been beneficial. Thus the finding in regards to compensability for the bariatric surgery was reversed.

In regards to the family therapy sessions, Mercy argued that the medical care contemplated by section 85.27 is for the worker alone, not the worker’s family. The Court first noted the deputy agreed with Mercy Hospital that it could only order Mercy Hospital to pay for medical care to the claimant, not her family. However it found the family therapy was recommended by the treating physicians to treat the claimant’s depression. Part of the family therapy benefited the claimant and part benefited her family. Because the deputy was unable to dissect out what part of the therapy benefited the claimant alone, it ordered Mercy Hospital to pay for one-half of the cost. The Court found no error in the deputy’s decision. The court held the deputy did not order Mercy Hospital to pay for care given to the family. The deputy reduced the amount payable by half in order to hold Mercy Hospital responsible for a portion of the therapy that benefited the claimant. Thus the issue was affirmed.

Call Mark Bosscher or Lee Hook with any questions @ 515-243-2100.  We’d be happy to help, whether it be a quick or a complex issue!

Jennifer Caswell successfully defended a case involving a claimed low back injury.  Claimant indicated to co-workers that there was a non-work cause. Ms. Caswell’s presentation of the witnesses and her cross-examination of the claimant demonstrated that claimant was not credible. Judge Stine entered an order of dismissal with prejudice. Therefore, the employer did not have to pay any temporary disability, medical expenses, or permanent disability, nor was it ordered to pay the attorney fee in excess of $11,000.00 claimed by opposing counsel.

In another case,Jennifer Caswell obtained an order of dismissal when she successfully argued that no compensable injury or aggravation occurred and any disability or symptoms claimant had were related to a pre-existing degenerative condition.   Had Judge Fridrich found for claimant on causation, her permanency award would very likely have been permanent total disability with a present value of almost $650,000.00, plus additional exposure for medical treatment.

Insurer sent settlement payment to the employer’s attorney on the 30^th day after entry of an order approving lump sum settlement. However, the payment was not delivered to counsel for the employee until the 31^st day after the lump sum order was entered. The Court of Appeals held that a 50% penalty on the $265,000.00 settlement check was due. Had the adjuster sent the check via UPS directly to counsel for plaintiff there would be no penalty due, even though it arrived on the 31^st day, because it was sent within 30 days as required byBrown v. Harbor Fin. Mortgage Corp., 267 Neb. 218, (2004).

Harris v. Iowa Tanklines, Inc.,20 Neb. App. 513 (2013)

NC Risk Handling Hint -Setting Aside a Form 60

Dennis Ray Spivey was employed by Wright’s Roofing as a laborer for approximately three years. Wright’s
Roofing contracted with AMS Staff Leasing, who provided workers’ compensation coverage for its employeeswhose employment had been reported to AMS. Spivey completed forms required by AMS and AMS issued his paychecks. Plaintiff stopped working for Wright’s Roofing and a Wright’s Roofing representative submitted termination forms to AMS noting that Spivey was no longer employed by Wright’s Roofing. A year later, Spivey resumed his employment with Wright’s Roofing but did not complete AMS staffing forms. Instead, Spivey was paid with checks drawn on a Wright’s Roofing account.

One day, Spivey was injured as he worked on a residential job in which Boyet Builders was the general contractor and Wright’s Roofing was the subcontractor. Spivey filed a Form 18 and AMS Staff Leasing, Dallas National Insurance, Co., and Crawford & Company (hereinafter “Defendants”) filed a Form 60 and began paying weekly disability benefits. Shortly thereafter, Defendants determined that they had no Workers’ Compensation coverage applicable to Spivey, and filed Forms 63 and 61, denying liability and terminating benefits.

Spivey filed an amended Form 18 and a Form 33 in which he named Wright’s Roofing, Dallas National and Boyet Builders as responsible parties. Boyet Builders filed a Form 61 and a Form 33R and denied that Spivey was its employee at the time of the injury and asserted that Defendants had already accepted liability for benefits.

At hearing, Spivey moved that Defendants be ordered to reinstate TTD benefits and Deputy Commissioner Phillips allowed the motion. She later entered an Order holding Boyet Builders and Auto-Owners Insurance liable for Spivey’s injury and ordered them to pay indemnity and medical benefits. Boyet and Auto Owners appealed to the Full Commission. The Commission determined that Defendants had no legal basis to withdraw their Form 60 and ordered them to provide indemnity and medical benefits. Defendants appealed to the North Carolina Court of Appeals.

On January 15, 2013 inSpivey v. Wright’s Roofing, the Court first considered whether the Full Commission erred by refusing to allow Defendants to set aside the Form 60. Finding no error, the Court noted that an employer who files a Form 60 waives the right to contest the compensability of a claim on the basis of a unilateral mistake. According to the Court, the burden is on the employer or carrier to determine whether a particular claim is compensable and whether the employer or carrier is liable before filing a Form 60.

The Court also addressed the issue of whether the Full Commission erred in holding that Boyet Builders was not responsible for benefits pursuant to N.C.G.S.§ 97-19. The Court noted that N.C.G.S. § 97-19 applies only when two conditions are met. First, the injured employee must be working for a subcontractor doing work that has been contracted to it by a principal contractor. Second, the subcontractor does not have workers’ compensation insurance coverage covering the injured employee and since workers’ compensation insurance was available through Spivey’s immediate employer, Wright’s Roofing, because Defendants accepted the claim, there was no error.

Risk Handling Hint:Risk Managers are reminded to carefully consider whether a claim is compensable before accepting an injury on a Form 60. Benefits can be paid and medical treatment provided during the investigation period by filing a Form 63. If additional time is required to conduct an investigation, the employer and carrier can request a limited extension of time from the Industrial Commission.

Michael DePue v. WCAB (N. Paone Construction, Inc.) 

1113 C.D. 2012 (PA. Cmwlth. January 30, 2013)

By: Lisa A. Miller, Esquire

The Commonwealth Court affirmed the Decision of the Appeal Board and WCJ which denied the Claimant’s Review Petition to add a left shoulder injury to the description of his work injury more than two (2) years after the approval of a Compromise and Release Agreement, and also denied Claimant’s Penalty Petition for failure to pay medical bills for the left shoulder injury.

The Claimant sustained a work-related closed head injury on February 26, 1996. On March 3, 2008, the Claimant and Defendant entered into a Compromise and Release Agreement to settle the Claimant’s indemnity benefits for a lump sum amount of $175,000.00 as “full and final satisfaction of all future wage loss benefits.”

The injuries described in the C&R Agreement were described as “any and all injuries. . . . including but not limited to the accepted injuries of a severe closed head injury with seizure disorder, and short term memory loss.” The Defendant agreed to continue to pay “all reasonable and related medical bills.” 

The Claimant filed a Penalty Petition alleging that Defendant failed, neglected, or refused to pay medical bills. The Claimant sought a fifty (50%) percent penalty on $1,200.00 in medical bills. The Claimant also filed a Review Petition alleging that the description of his work injuries were incorrect. 

The Defendant denied the Claimant’s allegations, and sought dismissal of the Review Petition invokingres judicata and collateral estoppel.

The Claimant submitted a Pre-Trial Memorandum in which he alleged that Defendant informed him in January 2010 that it would no longer pay for treatment for his left shoulder injury.

The Defendant submitted the WCJ’s Decision approving the Compromise and Release Agreement; the transcript of the Compromise and Release Hearing; and a packet of Proposed Addendums to the Compromise and Release Agreement prepared by Claimant’s counsel with changes, including a hand written notation made by Defendant’s counsel thereon; and the February 27, 2008 letter that Defendant’s counsel sent to Claimant’s counsel. 

In an Interlocutory Order, the WCJ precluded Claimant from proceeding on the Review Petition, and scheduled a hearing on the Penalty Petition to determine whether the Claimant was alleging unpaid medical bills from the left shoulder injury only, or for other injuries accepted by the Defendant. The WCJ indicated that if Claimant was alleging the medical bills only for the left shoulder injury, the Penalty Petition would be denied. Claimant’s counsel stated that the Penalty Petition was related only to the left shoulder injury, and the WCJ denied the Review and Penalty Petitions. 

The WCJ concluded that the Review Petition was barred byres judicatabecause the Claimant was aware of the left shoulder injury at the time of the C&R, and agreed not to include it in the Compromise and Release Agreement. The WCJ relied onWeney v. WCAB (Mac Sprinkler Systems, Inc.),960 A.2d 949 (Pa. Cmwlth. 2008). InWeney the Claimant’s first Review Petition was resolved by a Stipulation, in which the parties agreed to amend the NCP to include a shoulder injury. Three (3) days after the WCJ approved the Stipulation and granted the Review Petition, the Claimant filed another Review Petition to amend the NCP to add neck or cervical spine injuries. The Court concluded that the second Petition was barred by theres judicata because the Claimant was aware of those injuries and their causal relationship to the work incident during the first Review Petition proceeding, and should have litigated the claim during that proceeding. 

The Appeal Board affirmed the WCJ’s Decision, concluding that the evidence did not indicate that the C&R Agreement was entered into by unilateral or mutual mistake.  The Board determined that the C&R Agreement was final and binding, and that the Review Petition was barred byres judicata. The Board noted the Claimant was attempting to raise a matter in his Review Petition that should have been litigated during the earlier proceeding on the Compromise and Release Agreement underWeney.

The Claimant argued that the Compromise and Release Agreement should be “corrected” to add the left shoulder injury to the description of his work injuries.  The Claimant alleged that the left shoulder injury was “erroneously” omitted in the final draft of the Agreement. Claimant contends that the Employer routinely paid medical bills for the left shoulder injury, and that it knew that the bills were “casually related to his injuries.” Claimant disputed thatres judicata applied to the matter noting that there was no prior litigation involving a request to amend the description of his work injuries.

Employer argued that the Claimant flagrantly misrepresented that the left shoulder injury was erroneously omitted in the final draft of the Compromise and Release Agreement.  Employer contended that the Claimant was entitled to receive medical benefits only for the injuries described in the Compromise and Release Agreement as accepted by the Employer, and that the Review Petition was barred byres judicata and collateral estoppel. 

Section 449(a) and (b) of the Act provides that:

a) Nothing in this Act shall impair the right of the parties interested to compromise and release …any and all liability which is claimed to exist under this act on account of injury or death.

b) Upon or after filing a Petition, the Employer or Insurer may submit the proposed Compromise and Release by stipulation signed by both parties to the WCJ for approval. The WCJ shall consider the Petition and proposed Agreement in open hearing and shall render a Decision. The WCJ shall not approve any Compromise and Release unless he first determines that the Claimant understands the full legal significance of the Agreement. The Agreement must be explicit with regard to payment, if any, of reasonable, necessary and related medical expenses. 

In enacting Section 449 of the Act, the legislature intended a Compromise and Release Agreement to be “on equal footing with civil settlements” in order to promote a public policy of encouraging the parties to settle disputes and bring them to finality. Stroehmann Bakeries, Inc. v. WCAB (Plouse),768 A.2d 1193, 1196 (Pa. Cmwlth. 2001).

Defendant’s exhibits demonstrated that before the execution of the Compromise and Release Agreement, Claimant’s counsel sent a Proposed Addendum to the Agreement to Defendant’s counsel. 

Paragraph Twenty-Four (24) of the Proposed Addendum stated “the accepted injuries includes ‘closed’ head injury, seizure disorder, left shoulder fracture, chronic pain, loss of short term memory and bi-polar disorder. Defendant agrees to continue to provide medication and medical care which is reasonable and necessary, and casually related to his injuries.”

Defendant’s counsel sent the Proposed Addendum back to Claimant’s counsel after crossing out the injuries of “left shoulder fracture”, “chronic pain”, and “bi-polar disorder” in paragraph 24, and placing a hand written notation, which stated that “we already negotiated these injuries at the time of the ‘settlement’”. In a letter dated February 27, 2008, that accompanied the Proposed Addendum sent back to Claimant’s counsel with his changes and notation, Defendant’s counsel further stated “we previously negotiated the accepted injuries in 2007 and those are the only injuries I will outline on the Agreement.” The C & R Agreement signed by the Claimant and Defendant described Claimant’s injuries as accepted by Defendant as “a severe closed head injury with seizure disorder and short term memory loss” and omitted the other injuries listed in the Proposed Addendum. 

At the March 3, 2008 hearing, the Claimant testified that his head injury affected mostly his short term memory and caused seizures.  He was not asked, and did not testify as to the left shoulder injury. 

The WCJ found that Claimant understood the full legal significance of the Agreement “as regards to his work related injury and right to Worker’s Compensation benefits.”  The WCJ determined that the parties entered into a “valid and binding Agreement” Department of Labor and Industry, Bureau of Worker’s Compensation v. WCAB (Ethan-Allen Eldridge Division),972 A.2d 1268 (Pa. Cmwlth. 2009).  An approved Compromise and Release Agreement can be set aside only upon a clear showing of fraud, deception, duress, a mutual mistake or unilateral mistake caused by an opposing party’s fault. Farner v. WCAB (Rockwell Int’l), 869 A.2d 1075 (Pa. Cmwlth. 2005);Barsczzewski v. WCAB (Pathmark Stores, Inc.), 868 A.2d 224 (Pa. Cmwlth. 2004).

After negotiations with the Defendant, the Claimant agreed to omit the left shoulder injury from the description of his injuries accepted by the Defendant in the Compromise and Release Agreement. The record did not support Claimant’s assertion that the left shoulder injury was erroneously omitted in the final draft of the Compromise and Release Agreement. The Compromise and Release Agreement was final and binding on the parties, and may not be amended after its unappealed approval period.

Once a Compromise and Release Agreement is approved, any issue which was not expressly reserved in the Agreement may not be raised later.  Department of Labor and Industry, Bureau of Workers’ Compensation v. WCAB (U.S. Food Service), 932 A.2d 309 (Pa. Cmwlth. 2007). Because the Claimant did not expressly reserve his right to add the new injury to the description of his work injuries, he was precluded from doing so more than two (2) years after the approval of the Compromise and Release Agreement.

Claimant argued that the description of the “injury” in the Compromise and Release Agreement as “any and all injuries” sustained in Employer’s workplace indicates the party’s intention to include the left shoulder injury in the injuries accepted by the Defendant. The Claimant relied on the contract construction rule that the intention of the parties must be ascertained from the document itself, if its terms are clear an unambiguous. 

However, Employer did not accept its liability for the left shoulder injury in the NCP or in any Agreement, and specifically refused to include it as part of the Compromise and Release. Nor was there any prior decision finding Defendant liable for that injury. 

The Court rejected the Claimant’s reliance on the Doctrine of Promissory and Equitable Estoppel. Promissory estoppel may be invoked to enforce a promise made by a party to an opposing party when there is no enforceable agreement between the parties. Crouse v. Cyclops Indus., 560 Pa. 394, 745 A.2d 606 (2000). 

In order to maintain an action in promissory estoppel, the aggrieved party must show the (1) the promissor made a promise that he or she should have reasonably expected to induce action or forbearance on the part of the promisee; (2) the promisee actually took action refrained from taking action in reliance on the promise; and (3) injustice can be avoided only by enforcing the promise.  The essential elements of equitable estoppel are that the party’s inducement of the other party to believe certain facts to exist and the other party’s reliance on that belief to act. Westinghouse Elec. Corp/CBS v. WCAB (Korach),584 Pa. 411, 883 A.2d 579 (2005). In the absence of “expressly proved fraud, there can be no estoppel based on the acts or conduct of the party sought to be estopped, where they are as consistent with the honest purpose and with absence of negligence as with their opposites.” Westinghouse, 584 Pa. at 423, 883 A.2d at 586. 

Nothing in the record suggests that Defendant promised to continue to pay medical bills for the left shoulder injury, and that Claimant relied on such promise to enter into the Compromise and Release Agreement. The record demonstrates that he negotiated the extent of his work injuries with the Employer, and ultimately agreed to omit the left shoulder injury in the Agreement. Claimant can not rely on the Employer’s voluntary payment of the medical bills for the left shoulder injury to support his estoppel claims. The Court has consistently held that Employer’s voluntary medical payment does not constitute an admission of liability for the injury. Securitas Sec. Servs. USA, Inc. v. WCAB (Schuh),16 A.3d 1221 (Pa. Cmwlth. 2011); Findley Township v. WCAB (Phillis),996 A.2d 111 (Pa. Cmwlth. 2010). To hold otherwise would be contrary to the Act’s policy of encouraging Employers to voluntarily pay medical expenses to injured employees to assist them in regaining health without fear of being later penalized for the payment. Defendant’s payment of medical expenses was not an admission of liability for the left shoulder injury and cannot be construed as a promise to continue to make such payment. 

In conclusion, the Claimant’s Review Petition was barred by the final and binding Compromise and Release Agreement. 

Here are the details of a new proposed bill out of the Iowa House that would change the way we handle alternate medical care, among other items:

House File 274

Bill Explanation:
This bill relates to the state's workers' compensation laws by modifying alternate care procedures for medical treatment, creating registries of physicians who treat and evaluate work=related injuries, providing for the retention of a medical director, creating a state workplace injury care providers registry fund, establishing a workers' compensation advisory council, providing for and appropriating fees, and providing effective dates.

MEDICAL AND ALTERNATE CARE. Code section 85.27(4), concerning the provision of medical services, requires an employer to provide written information about the state's workers' compensation laws to an employee upon receiving notification that the employee has suffered a work=related injury.

The employer has the right to predesignate a licensed physician to treat the injury and make necessary referrals and may predesignate a physician listed on the state registry of workplace injury care providers. If the employer does not predesignate a treating physician, the employee may designate a physician of the employee's choosing to provide the treatment. The physician predesignated by the employer or designated by the employee is required to provide ongoing written documentation of the physician's opinions, treatment recommendations, and care plan to the employee along with information about whether the opinions, recommendations, and care plan are in accord with either the official disability guidelines and treatment guidelines in workers' compensation published by the work loss data institute or the American college of occupational and environmental medicine practice guidelines (ACOEM), and if so, citation to the appropriate guidelines. The employee has the right to request and obtain a second opinion from another licensed physician of the employee's choosing at the employer's expense. If the employer or employee is dissatisfied with the care of a treating physician predesignated or designated by the other party or with any referral made by that physician, the employer and employee may mutually agree to alternate care. If they cannot agree on alternate care, either party may notify an insurance claims specialist within the division of workers' compensation, who shall, within five working days, schedule a conference between the parties to review the basis for dissatisfaction and provide an advisory opinion to resolve the dispute. If the parties still cannot agree on alternate care after this conference, the workers' compensation commissioner may, upon application and reasonable proof of the necessity, allow and order alternate care. The employee is responsible to make the application for alternate care and to provide such reasonable proof to the commissioner if the employer provided written information about the state's workers' compensation laws at the time of notification of the employee's injury, and predesignated a treating physician listed on the state registry of workplace injury care providers, and if the treating physician predesignated by the employer provided written documentation to the employee of the physician's opinions, treatment recommendations, and care plan along with citation to the appropriate treatment guidelines. The employer is responsible for making the application for alternate care and providing reasonable proof if the employer and predesignated treating physician did not act as described above or if the employee designated the treating physician to treat the work injury. The commissioner is not bound by the advisory opinion of the claims specialist and must conduct a hearing and issue a decision within 10 days of receipt of an application for alternate care. The employer has the right to request an employee to submit, as often as is reasonable and at a reasonable time and place to an examination by a licensed physician chosen by the employer for any purpose relevant to the employer's duties to provide benefits to the employee under the state's workers' compensation laws and at the employer's expense. If the employer makes the request in writing and pays all expenses, including transportation, the employee shall submit to the examination. Each time that the employer obtains an evaluation of an employee's permanent disability by a physician chosen by the employer, if the employee believes that the evaluation of disability is too low, the employee may obtain a subsequent examination and evaluation by a physician of the employee's choosing at the employer's expense, including transportation expenses to and from the place of the examination.

PROVIDER REGISTRIES ==== FEES ==== MEDICAL DIRECTOR. New Code section 85.73 requires the workers' compensation commissioner to establish and maintain a registry of licensed physicians that offer or provide treatment of work=related injuries. The commissioner shall, by administrative rule, establish requirements for a physician to be listed on the registry and establish a registration fee. The provision shall not be construed to require a physician to be listed on the registry in order to offer or provide treatment of work=related injuries or to prohibit an employer or employee from predesignating or designating a physician to provide treatment who is not listed on the registry.

New Code section 85.74 requires the commissioner to establish and maintain a separate registry of licensed physicians trained to perform independent medical evaluations and to issue impairment ratings of injured employees. The commissioner shall establish, by administrative rule, minimum training requirements for a physician to be listed on the registry and establish a fee. A physician must be listed on the registry in order to perform independent medical evaluations and issue impairment ratings of injured employees in this state. The commissioner may prohibit an employer or employee from using an independent medical evaluation or impairment rating of an injured employee from a physician who is not listed on the registry as evidence at a hearing to determine benefits under the state's workers' compensation laws.

New Code section 85.76 authorizes the commissioner to retain the services of a medical director to assist the division of workers' compensation in advancing the field of occupational health in Iowa and to advise the commissioner on how to successfully apply and administer the state's workers' compensation laws.
STATE WORKPLACE INJURY CARE PROVIDERS REGISTRY FUND. All registration fees collected pursuant to new Code sections 85.73 and 85.74 shall be credited to the state workplace injury care providers registry fund created in new Code section 85.77 and are appropriated to the division of workers' compensation by new Code section 85.75 to carry out the provisions of new Code sections 85.73, 85.74, 85.75, 85.76, and 85.78, including establishing and maintaining the two physician registries, retaining a medical director, and for the expenses of the workers' compensation advisory council created in new Code section 85.78.

WORKERS' COMPENSATION ADVISORY COUNCIL. New Code section 85.78 establishes a workers' compensation advisory council within the division of workers' compensation that is composed of six members, three representing employers and three representing organized labor. The governor appoints two of the members, the president and the minority leader of the senate jointly appoint two members, and the speaker and the minority leader of the house of representatives jointly appoint two members. The members serve six=year staggered terms, except that for the initial terms beginning on January 1, 2014, one member appointed by the governor, one member representing employers, and one member representing organized labor shall be appointed for three=year terms to ensure that members serve staggered terms. The purpose of the council is to assist the workers' compensation commissioner in the successful administration of the division of workers' compensation and to make recommendations to the governor and the general assembly regarding workplace safety and improvements to the state's workers' compensation system.

EFFECTIVE DATES. The sections of the bill creating the provider registry for treatment of work injuries, the provider registry fund, the position of medical director, and the advisory council, and appropriating fees, take effect January 1, 2014. The sections of the bill pertaining to alternate care procedures and required registration of physicians performing independent medical evaluations and impairment ratings take effect July 1, 2014.

If you have any questions on this, please feel free to call Mark Bosscher or Lee Hook at 515-243-2100. We'd be happy to help answer any questions you might have, big or small!

On February 15, 2013, the Alabama Court of Civil Appeals released its opinion in CVS/Caremark Corp. v. Gloria Washington wherein it addressed  the affirmative defense of judicial estoppel in the workers’ compensation context. Specifically, the Court noted the availability of the defense but only when properly pled. 

The Court of Appeals had previously addressed the issue in White Tiger, Inc. v. Paul Clemons (released January 13, 2012).  In that case, the Court ruled that a claimant’s assertion that he was available and able to do some work at his unemployment hearing, did not prevent him from being awarded permanent and total disability benefits in his workers’ compensation case.  The Court noted that being willing and able to do some work does not necessarily mean that you are able to secure employment that you are physically able and qualified to do. In the workers’ compensation case the plaintiff testified that he could not secure work because of his disability but he would give it a shot if someone hired him for a job he was qualified to do. For this reason the Court held that the two statements, in separate judicial proceedings, did not contradict one another in order to satisfy the necessary criteria for judicial estoppel to apply. 

In the more recently decided Washington case, the Court held that the employer waived its right to assert judicial estoppel as a defense by not affirmatively asserting or pleading it.  The Court further noted that the employee would have been judicially estopped from prevailing on a claim for permanent and total disability benefits based on the Court’s rationale in Clemons.  The Court distinguished the two cases because the employee in Washington testified in her workers’ compensation case that she could not work at all because of her pain and she had not sought employment.  The employee further admitted that she misrepresented her condition and ability to work in her claim for unemployment benefits. Unlike the Clemons case, in which the plaintiff testified he would give it a shot if he was hired in a position he was qualified for in the workers’ compensation case, the employee in Washington testified that she could not work and had not sought work because her injury/pain prevented her from working at all. Therefore, the two statements were in direct conflict of one another.  

Practice Pointer: Judicial estoppel is a viable defense in workers’ compensation cases but only if it is affirmatively pled.   

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ABOUT THE AUTHOR 

The article was written by Joshua G. Holden, Esq. of Fish Nelson, LLC, a law firm dedicated to representing employers, self-insured employers and insurance carriers in workers’ compensation matters. Fish Nelson is a member of The National Workers’ Compensation Defense Network (NWCDN). If you have questions about this article or Alabama workers’ compensation issues in general, please feel free to contact the author at jholden@fishnelson.com, 205-332-1428 or any firm member at 205-332-3430.

On February 8, 2013, the Alabama Court of Civil Appeals released its opinion in Ex Parte Johns & Kirksey, Inc. wherein it denied an employer’s petition for a writ of mandamus.  In its petition, the employer had sought relief from an interlocutory order finding that alleged cumulative trauma back and leg injuries were compensable.   

At trial, the employee presented evidence that he sustained a work related back injury and underwent surgery in November 1996. The employee returned to work, performing at full-duty after his recovery. In 2008, the employee began to have trouble with his back and right leg and claimed the new problems were the result of repetitive manual labor resulting in a cumulative-trauma injury. In particular, the employee presented evidence that he spent 60% to 80% of his time at work performing manual labor such as heavy lifting and installing roofs which required repetitive bending, stooping, squatting and kneeling. Additionally, a physician stated that the employee’s job duties were at least a contributing cause of his injuries.   

The employer offered testimony that the employee only spent 50% of his time performing manual labor, with half of that falling in the light or medium-duty range.  

In denying the employer’s petition, the Court of Appeals noted that the evidence presented at trial supported a finding that the employee proved both medical and legal causation by clear and convincing evidence. As such, the employer could not establish a clear legal right to the relief sought.   

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About the Author           

This blog post was written by Trey Cotney, Esq. of Fish Nelson LLC, a law firm dedicated to representing employers, self-insured employers and insurance carriers in workers’ compensation matters. Fish Nelson is a member of The National Workers’ Compensation Network (NWCDN). If you have any questions about this article or Alabama workers’ compensation issues in general, please feel free to contact the author at tcotney@fishnelson.com or any firm member at 205-332-3430.

In Alabama, an aggravation of a preexisting condition can be treated as a new injury if the claimant was working without restriction prior to the accident date or date of last exposure to cumulative trauma. This is similar to the law in Iowa. Recently, an Iowa workers’ compensation matter (McQuown v. Brecht Trucking, Inc.) was initially decided in favor of the employer based, in large part, on medical testimony distinguishing between aggravation and symptoms. According to the testifying doctor, an aggravation means that an underlying situation was made to be medically worse, which is different than merely experiencing symptoms of a preexisting condition while performing work duties.

Iowa Workers' Compensation cases can go through several levels of appeal. The above case was first tried before a Deputy Workers Compensation Commissioner who issued an arbitration decision in favor of the employer. The case was then appealed to the Iowa Workers Compensation Commissioner which reversed the arbitration decision. The employer now has the option of appealing the matter to the Iowa District Court.

My Two Cents: 

Although this is an Iowa case, it is a must read for anyone that handles Alabama workers’ compensation matters. It presents an interesting argument which employers and treating physicians should consider when presented with an aggravation claim.

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About the Author  

This article was written by Michael I. Fish, Esq. of Fish Nelson LLC, a law firm dedicated to representing employers, self-insured employers and insurance carriers in workers’ compensation matters. Fish Nelson is a member of The National Workers’ Compensation Network (NWCDN). If you have any questions about this article or Alabama workers’ compensation issues in general, please feel free to contact the author at mfish@fishnelson.com or any firm member at 205-332-3430.

NC Risk Handling Hint -N.C.G.S. § 97-6; Employment Relationship

In a startling departure fromestablished precedent, the North Carolina Court of Appeals has elevated the position of a written agreement with regard to the determination of whether an employment relationship exists for the purposes of workers’ compensation. InGregory v. Pearson, the Court held that, “[b]ecause the [Defendant] chose [by contract] not to establish an employment relationship with [Plaintiff], it eschews both the liabilities and protections of the Workers’ Compensation Act.” The Court in Gregory went on to explain the provisions of N.C.G.S. § 97-6, which provides that “[n]o contract…shall in any manner operate to relieve an employer…of any obligation created by this Article,” did not apply as the parties’ agreement had already explicitly rejected an employment relationship in contract. In other words, because Defendant agreed in a contract that no employment relationship existed, the Workers’ Compensation Act did not apply and Defendant could not avail itself of the exclusivity provision of the Act.

The decision inGregory was handed down on December 31, 2012. As such, the time-frame for pursuing additional review or rehearing hasnot yet run. For the time being, however, this decision looks to be a significant development in the body of case-law which defines an employment relationship for purposes of workers’ compensation. It may be North Carolina’s first step toward allowing employers to “opt out” of the workers’ compensation system.

TCDG will continue to monitor this development as its outcome and impact become more clear.