State News

Effective July 1, 2022, the mileage reimbursement rate for Alabama has been increased to 62.5 cents per mile, and 4 cent increase over the first half of 2022.

About the Author

This blog submission was prepared by Charley Drummond, an attorney with Fish Nelson & Holden, LLC, a law firm dedicated to representing self-insured employers, insurance carriers, and third party administrators in all matters related to workers’ compensation. Fish Nelson & Holden is a member of the National Workers’ Compensation Defense Network. If you have any questions about this submission or Alabama workers’ compensation in general, please contact Mr. Drummond by e-mailing him at cdrummond@fishnelson.com or by calling him directly at (205) 332-3414.

The Alabama Supreme Court recently affirmed summary judgment in favor of Pilgrim’s Pride Corporation and its third-party workers’ compensation administrator, Sedgwick Claims Management entered by the Circuit Court of Franklin County, Alabama in regard to a claim for the tort of outrage brought by Florence King.  King initially asserted a workers’ compensation claim against Pilgrim’s Pride in October 2012, claiming that she suffered injuries to both shoulders and arms as a result of the repetitive nature of her job on Pilgrim’s Pride’s production line.  Although Pilgrim’s Pride disputed the compensability of King’s alleged injuries, it nevertheless provided King with medical treatment, which included surgery on one of her shoulders and pain management.  After King’s doctors determined she had reached maximum medical improvement, the claims adjuster at Sedgwick reached out to King and offered to settle her case as disputed.  King initially accepted the settlement offer, but then changed her mind.  When additional treatment prescribed by King’s treating physicians was not approved, King sued Pilgrim’s Pride for workers’ compensation benefits.  She also sued Pilgrim’s Pride and Sedgwick asserting a claim of outrage, for what she claimed was intentional infliction of emotional distress due to a delay in approving medical treatment related to her alleged injuries.  Pilgrim’s Pride denied the allegations of King’s Complaint, asserting that her alleged injuries were not compensable.  The workers’ compensation case proceeded to trial in September 2020.  The parties stipulated that the only issue in dispute at trial was whether King’s alleged injuries were compensable.  King’s orthopedist testified that he did not have a firm conviction as to whether King’s job duties caused or contributed to her alleged injuries.  However, the trial court found King’s alleged injuries compensable.  

Thereafter, both Pilgrim’s Pride and Sedgwick filed motions for summary judgment as to King’s outrage claim.  The defendants asserted that since the compensability of King’s alleged injuries was disputed, they had no duty to provide King with medical treatment until the trial court found those alleged injuries compensable.  The trial court agreed, and entered summary judgment in their favor.  King then appealed to the Supreme Court, and the Court affirmed the trial court’s decision without writing a formal opinion.

My Two Cents

Outrage is an extremely limited cause of action.  In order to prevail on a claim for the tort of outrage, a plaintiff must prove by clear and convincing evidence that the defendant intended to inflict emotional distress and that the defendant’s outrageous and extreme conduct caused emotional distress so severe that no reasonable person could be expected to endure it.  Alabama law has long held that a defendant cannot be liable for the tort of outrage by merely insisting on its legal rights – even if the defendant knows that doing so is likely to cause severe emotional distress.  Alabama law has also long held that it would be a violation of an employer’s right to due process of the law to require it to provide workers’ compensation benefits when there is a bona fide dispute as to the employer’s liability for the injury.  Therefore, the Supreme Court’s decision affirms the fact that an employer (or its insurer) cannot be found guilty of outrageous conduct for denying workers’ compensation benefits when there has been no admission or legal adjudication that the underlying injury is compensable.  

About the Author

 This blog submission was prepared by Charley Drummond, an attorney with Fish Nelson & Holden, LLC, a law firm dedicated to representing self-insured employers, insurance carriers, and third party administrators in all matters related to workers’ compensation. Fish Nelson & Holden is a member of the National Workers’ Compensation Defense Network. If you have any questions about this submission or Alabama workers’ compensation in general, please contact Mr. Drummond by e-mailing him at cdrummond@fishnelson.com or by calling him directly at (205) 332-3414.

2x Multiplier and Return to Work

Helton v. Rockhampton Energy, LLC (2021-SC-0248-WC)

The 2x multiplier in KRS 342.730(1)(c)2 applies to permanent partial disability benefits only where an employee “returns to work” after a work-related injury at the same or higher wages and that work subsequently ends.  To qualify as a “return to work,” there must be a cessation of work followed by a resumption of work. Continuation of work is not a return to work.

Employee suffered a work-related injury on 11/16/18. He continued working his normal job at the same or greater wages until he was laid off for economic reasons on 9/2/19. Prior to being laid off, the employer never ceased working after the injury. The ALJ awarded the 2x multiplier since he was working making the same or greater wages post-injury and was then laid off. The Board reversed finding there was no “return” to work pursuant to KRS 342.730(1)(c)(2) because there was never a cessation of work followed by a resumption. The Court of Appeals and Supreme Court of Kentucky upheld the reversal.

3x Multiplier and Inapplicability of Public Policy Exclusion

Tractor Supply v. Wells (2021-SC-0286-WC)

In Livingood v. Transfreight, LLC, the Court held that if an employee returns to work making equal or greater wages and is subsequently fired for intentional misconduct with a reckless disregard to the consequences, the employee is not entitled to the 2x multiplier as awarding same would be against the public policy rule that no claimant should profit from own misconduct. Here, the employer sought to expand this public policy exclusion to the 3x multiplier which, pursuant to 342.730(1)(c)1, applies when the claimant no longer has the physical ability to return to the pre-injury job.

The employee was injured at work resulting in restrictions that prevented her from performing her pre-injury job duties. She returned to a light duty position and was subsequently terminated for allegedly providing false information during an investigation (unrelated to workers’ comp claim).

The ALJ awarded indemnity benefits with the 3x multiplier. The employer argued that claimant was not entitled to the 3x multiplier due to her misconduct, seeking to extend the holding in Livingood.

Affirming the decision of the ALJ, the Board, and Court of Appeals, the Supreme Court of Kentucky declined to extend Livingood to the 3x multiplier. The Court found that the 3x multiplier is concerned with the finding of disability and is not tied to any condition of employment. Because the 2x multiplier is related to leaving employment, it was reasonable for the court to determine that when the job loss is due to misconduct, awarding a double benefit would be unreasonable and against public policy. Here, the employee was entitled to the 3x multiplier because she could not return to her pre-injury duties and her subsequent termination was irrelevant.

Admissibility of Out of State Physician Reports

Toler v. Oldham County Fiscal Court (2021-SC-0356-WC)

In a case of first impression, the Supreme Court of Kentucky held that a written report by a physician not licensed in Kentucky cannot be submitted as evidence in a workers’ compensation case.

Overturning the ALJ, the Board and Court of Appeals, the Supreme Court first noted that the Kentucky Rules of Evidence (“KRE”) must be followed in all proceedings before an ALJ, except as varied by statute or 803 KAR 25:010. It then stated that KRS 342.033 provides that a party may introduce direct testimony from a physician through a written medical report. The Court also referenced 803 KAR 25:010 which states a party may file evidence from two physicians in accordance with KRS 342.033, either by deposition or medical report. Holding that the written report of a physician not licensed in Kentucky was inadmissible, the Court found that the plain language of KRS 342.0011(32) defining “physician” only included those who were licensed in Kentucky. It further found that the prefatory phrase in KRS 342.011 “unless context otherwise requires” did not apply.

The Court clarified that this holding does not apply to treating physicians because the “context otherwise requires” phrase required an expanded reading of physicians when dealing with treating physicians. Therefore, a treating physician not licensed in Kentucky may provide a written opinion on behalf of an employee. 

Note this case involved the admissibility of a written report. It is arguable that a medical opinion of an out of state physician introduced by deposition testimony would be admissible. In a 2005 case, the Supreme Court of Kentucky allowed the deposition testimony of a non-physician expert on the issue of causation, specifically stating that the definition of “physician” does not preclude an ALJ from considering other types of expert testimony if it is relevant to resolving a causation question. Dravo Lime Co., Inc. v. Eakins. Also, KRE 702 allows expert testimony on relevant issues, and it seems it would violate the KRE to refuse to admit deposition testimony of qualified experts, including out of state physicians.

Even if an out of state physician opinion would be admissible through deposition, it may now be difficult if not impossible to get the claimant to see an out of state physician if not licensed in Kentucky. KRS 342.205(1), in pertinent parts, states that “[a]fter an injury and so long as compensation is claimed, the employee, if requested by a party…shall submit himself or herself to examination, at a reasonable time and place, to a duly qualified physician or surgeon designated and paid by the requesting party.” (emphasis added).

Furthermore, if a claimant has moved out of state, it appears the employer will now have to pay to have the claimant travel back to Kentucky for an examination with a Kentucky licensed physician if they wish to submit a written report into evidence.

There are numerous places throughout KRS Chapter 342 and the applicable regulations that could be impacted by this decision, including regulations governing Utilization Review (“UR”) and Medical Fee Disputes. UR is currently being regulated by an emergency regulation while the new regulations work their way through the regulatory approval process. 803 KAR 25:195E defines “physician” as defined by KRS 342.0011(32). It further provides that “only a physician shall issue an initial utilization review denial.” (emphasis added). Final UR decisions also needed to be issued by a “physician.” Do UR denials now need to be made only by Kentucky licensed physicians? Can the UR decisions be admitted into evidence in medical fee disputes (“MFD”) if the physician is out of state? The DWC is working on current regulations to govern UR and MFD, so we anticipate the new regulations will provide clarification and guidance on these issues. Also, a Petition for Rehearing has been submitted to the Supreme Court requesting clarification on the impact this decision will have on the UR process. We will monitor closely and keep you updated on any developments.

Sixty-Day Submission Requirement for Medical Bills Applies Only Post-Award

Wonderfoil, Inc. v. Russell (2020-SC-0301-WC)

The Supreme Court of Kentucky held that the Board and Court of Appeals properly reversed the ALJ’s ruling that certain medical expenses were not submitted timely, holding that the 60-day deadline for submission of medical expenses by an employee only applies post-award. 

The Supreme Court of Kentucky reasoned that pre-award application of the 60-day deadline found in 803 KAR 25:096 would contradict other regulations requiring disclosure of unpaid medical bills during litigation. It cited a prior Board opinion, Brown Pallet v. Jones, which held that the 45-day deadline for submission of bills by medical providers found in KRS 342.020 only applies post-award. The Court also cited its earlier decision in R.J. Corman Railroad Construction v. Haddix holding that the requirement that employers pay medical bills within 30 days only applies post-award.

The Court explained that the claimant is still required to submit unpaid medical expenses in its Notice of Disclosure which must be filed within 45-days of the issuance of the Notice of Filing Application. Furthermore, the claimant then must turn over new medical expenses within 10 days of receiving same. And claimant must bring copies of unpaid medical bills and expenses to the Benefit Review Conference and failure “may” constitute a waiver to claim payment for those bills.

Exclusive Remedy and Up-the-Ladder Immunity

Cunningham v. Kroger Limited Partnership I (2021-CA-0704-MR)

Plaintiff worked for Penske, who agreed by contract to receive freight for Kroger Limited Partnership II (“KLP II) and deliver said freight to KLP II and to facilities of all KLP II’s divisions, subsidiaries or affiliates. Plaintiff was injured while making a delivery to Danville Kroger store, which is owned and operated by KLP I, a limited partner of the Kroger Company. KLP II is a subsidiary of the Kroger Company.

Plaintiff received workers’ compensation benefits from his employer, Penske. Plaintiff then filed civil suit against KLP I alleging negligence and seeking damages for medical expenses, lost wages and pain and suffering. The Court of Appeals affirmed the lower court decision granting KLP I summary judgment as an up-the-ladder employer immune from tort liability.

Application of 3x Multiplier to Injuries Sustained on Two Separate Occasions

Apple Valley Sanitation, Inc. v. Jon Stambaugh (2021-SC-0227-WC)

The employee sustained two separate work injuries, returning to work after the first injury until a subsequent injury 12 weeks later, after which he did not return to work. The employee was performing his pre-injury job except for a light duty restriction during 6 of the 12 weeks. The employee submitted a physician report stating he lacked the physical ability to perform his pre-injury job. The ALJ awarded benefits for both injury dates enhancing both by the 3x multiplier.

The employer argued that it was erroneous to enhance the award for the first injury date by the 3x multiplier because the employee returned to work performing the same job after the first injury. The Supreme Court of Kentucky affirmed the award of the 3x multiplier, finding that the employee’s continued work did not constitute a return to work reflecting a capacity to continue pre-injury work for the indefinite future.

Psychological and Psychiatric Conditions

Time Warner Cable, Inc. v. Smith (2020-SC-0580-WC)

The Supreme Court of Kentucky held that a Claimant's testimony is competent evidence as to his psychological medical condition, which the ALJ can rely on when determining the extent and duration of a disability. Here the claimant presented medical reports assessing physical and psychological impairments due to the work injury. The psychological report failed to assess restrictions based on the psychological condition. The ALJ noted that the physical injury and physical restrictions alone did not render the claimant permanently and totally disabled. Relying on the claimant’s testimony as to the affect his psychological condition had on his ability to work, the ALJ  found the claimant permanently and totally disabled and the Supreme Court affirmed.

Should you have any questions or wish to discuss any related matters, please contact us at your convenience.

H. Douglas Jones, Esq. – djones@jsbattorneys.com, 859.594.4200

Margo Menefee, Esq. – mmenefee@jsbattorneys.com, 859.594.4200

Chiropractic leads to lower costs in workers' compensation claims?

Color us skeptical, but new research suggests that chiropractic care may, indeed, lead to lower costs in some types of workers’ compensation claims. 

The Workers’ Compensation Research Institute (WCRI) announced last month the release of its new study titled Chiropractic Care for Workers with Low Back Pain, which considered data from 28 states, including Texas.  The results may be surprising to some. Among the study’s key findings were that claims with care provided exclusively by chiropractors were associated with lower costs and shorter duration of temporary disability than a set of claims with similar characteristics where care was exclusively provided by non-chiropractic providers.

More cocktail party trivia: According to its website, the WCRI is an independent, not-for-profit research organization based in Cambridge, Massachusetts. Organized in 1983, the Institute does not take positions on the issues it researches; rather, it provides information obtained through studies and data collection efforts which conform to recognized scientific methods. Objectivity is further insured through rigorous, unbiased peer review procedures. 

Copyright 2022, Stone Loughlin & Swanson, LLP 

Coming soon - your EDI data collection agent questions answered
 

If you have questions about the Division’s new EDI data collection agent and the billing registration process, you’re not alone. Insurance carriers have so many questions that the Division is hosting a Zoom call to address them. The call comes in the wake of the Division’s announcement that it is changing the process by which insurance carriers must report claim data through electronic data interchange (EDI). 

Currently, carriers are required to report EDI claim data using an antiquated standard  – to be precise, International Association of Industrial Accident Boards and Commissions (IAIABC) Release 1.0. But beginning July 26, 2023, the Division will be requiring carriers to use the current standard, IAIABC Release 3.1.4. This and other requirements are set out in new Division rules 124.100 - 124.108. 

As part of the conversion, the Division designated a private contractor, Verisk, as its data collection agent for claim EDI release 3.1 data. Verisk will bill insurance carriers, other than governmental entities, for the cost of data collection. Accordingly, insurance carriers were required to register their billing contact information with Verisk by June 13, 2022. 

Also, as part of the conversion, each insurance carrier will be required to designate one person as its claim EDI compliance coordinator and provide that person’s contact information to the Division. Carriers can report this information to the Division on new Form EDI-03. 

Bonus cocktail party trivia: According to its website, the IAIABC was founded in 1914 and is an association of workers’ compensation jurisdictional agencies from around the world, as well as private organizations involved in the delivery of workers’ compensation benefits and services. It works to identify best practices, develop and implement standards, and provide education and information sharing. 
 

Copyright 2022, Stone Loughlin & Swanson, LLP 

In Texas, the wheels of justice grind slowly

Speaking of appeals, we continue to await the decision of the appeals court in our legal challenge to the Division’s Supplemental Income Benefits rule.

Readers may recall that our firm, on behalf of an interested insurance carrier, filed suit challenging the validity of the SIBs rule on the basis that it impermissibly allows claimants to collect SIBs even if they do not document their work search with job applications as required by the Texas Workers’ Compensation Act. Travis County district judge Maya Guerra Gamble agreed with the carrier that the rule is invalid, and she enjoined the Division from applying it. But the Division appealed to the Third Court of Appeals and, because the Division is part of a state agency, the judgment is stayed during the appeal.

The parties filed legal briefs in the court of appeals, and on August 30, 2021 the court announced  that it did not need to hear oral argument and the case was “ready for disposition on the briefs.” That was 10 months ago. By comparison, in the recent case of Dobbs v. Jackson Women’s Health Organization, in which the Supreme Court of the United States ruled that the Constitution does not guarantee the right to an abortion, the court issued its decision 8 months and 11 days after briefing was complete. And one could conclude that the issues in that case are more complicated than the issues in our SIBs case. 

By the way, SLS partner Jane Stone will be discussing the SIBs case at the upcoming Texas Bar CLE Advanced Workers’ Compensation seminar in August, by which time the court might have issued a decision.   

Copyright 2022, Stone Loughlin & Swanson, LLP 

Nice work if you can get it

The Texas Department of Insurance, Division of Workers’ Compensation has posted job openings for three Appeals Panel judges. This, apparently, is in response to three recent departures – we’ve learned that Rafael Quintanilla, Gary Kilgore, and Tom Knapp have retired. We’re envious, and we wish them well. 

Speaking of envy, the Division’s job posting describes some sweet fringe benefits. They include the following:

•    Telecommuting
•    96 hours of accrued vacation a year
•    96 hours of accrued sick leave a year
•    20+ holidays every year

Copyright 2022, Stone Loughlin & Swanson, LLP

SLS work safety tips
This month's subject - ladders

Don't do this:



Or this:

Copyright 2022, Stone Loughlin & Swanson, LLP

You're welcome

Those of you who listen to podcasts when you walk, run, or simply want to avoid any conversation with the unwashed masses on Southwest Airlines should check out Feedspot’s revised list of the 30 Best Workers’ Compensation Podcasts. Rounding out Feedspot’s top three are:

1.     Comp + Coffee

Described by Feedspot as a podcast from Payscale that talks through the art and science of compensation management. Two episodes per quarter. Average length 38 minutes. 

2.    Third Fridays

Described by Feedspot as a podcast from Lois LLC in which attorneys discuss workers’ compensation issues, share their opinions, and engage in colorful conversations. One episode per month. Average length 37 minutes.

3.     Adjusted

Described by Feedspot as a podcast in which Claire Muselman and Greg Hamlin take a deep dive with industry leaders who are changing the landscape of workers' compensation to offer a new perspective on insurance. Two episodes per month. Average length 36 minutes. 

Copyright 2022, Stone Loughlin & Swanson, LLP

It's in the (golf) bag. . .

Kids’ Chance of Texas has awarded 30 scholarships so far this year to kids who had a parent killed or catastrophically injured at work. There are more waiting to apply, so the group is hard at work raising money to make sure each one can be helped. You or your company can impact this effort directly by buying a sponsorship for the upcoming KCTX Golf Tournament on October 28. 

SLS is sponsoring again this year because this effort is near and dear to us. Go to www.Kidschanceoftexas.org for details, or send a check made out to Kids’ Chance of Texas to the attention of Jane Stone at SLS and she will make sure you get signed up . . . golf is included, depending on the level of sponsorship. 

Copyright 2022, Stone Loughlin & Swanson, LLP