Claimant can be compelled to release medical records as part of IME process

Claimant in Central Dauphin School District and Old Republic Insurance Company, c/o School Claims Services, LLC, v. W.C.A.B. (Siler), No. 612 C.D. 2006, argued that she could not be compelled to release certain medical records to insurer’s IME physician.

There was no dispute that claimant suffered work-related injuries to her knee, hip, elbow, arm and face as well as injuries of a psychological nature. Insurer asked that claimant attend an IME with a neurosurgeon and a second IME with a psychiatrist. During the psychiatric IME, claimant revealed that she had been treated for psychiatric problems in the past. The IME doctor advised the insurer that she would not be able to render an opinion without reviewing the prior psychiatric records. Claimant refused to release the records.

The employer filed a Petition to Compel a Physical Examination, asking that claimant be directed to release her psychiatric records. The WCJ denied the Petition to Compel and the Appeal Board affirmed the WCJ.

Commonwealth Court reversed, noting that IME’s are used to assess the extent of a claimant’s injuries and that a claimant must cooperate in these examinations and cooperation requires more than mere attendance. The Court did make note of another case where it compelled a claimant to undergo the diagnostic studies as part of the IME.

Ultimately, the Court held that a claimant’s prior medical records fall within the meaning of “physical examination” for purposes of an IME so the records had to be released.

Mere passage of time sufficient basis for seeking IME

Insurer in Davis v. W.C.A.B. (Woolworth Corp), No. 1873 C.D. 2006, sought an IME after claimant filed a UR request that resulted in a determination that claimant’s prescriptions were reasonable and necessary. Claimant resisted the request for an IME arguing that there was no reasonable basis to request an IRE since her prescriptions had just recently been found to be reasonable and necessary. However, claimant acknowledged that the last IME had been seven years prior to the most recent request. Insurer filed a Petition to Compel a Physical Exam.

The WCJ agreed with claimant and refused to grant the Petition to Compel. The Appeal Board reversed, determining that the purpose of an IME is to determine if claimant’s status has changed so the matter was remanded to the WCJ. In the second Decision, the WCJ concluded that there was no reasonable basis for insurer to request an IME, other than the passage of time, and that reason was not sufficient.

The Appeal Board again reversed the WCJ and claimant sought review by Commonwealth Court. In ruling that insurer was entitled to the IME, Commonwealth Court noted that the prior IME was performed seven years before the most recent request and in the case the mere passage of time was a sufficient basis to compel an IME.

In footnote #7 of its Opinion, Commonwealth Court declined to hold that two IME’s per year were reasonable per se, since so doing would infringe on a WCJ’s authority and discretion to order IME’s as circumstances would justify. This may mean that there could be more than two IME’s per year if a WCJ felt it was reasonable and this very well could mean that a WCJ could conclude that an insurer is not entitled to more than one IME per year if the WCJ thought that more IME’s were not reasonable.

Claimant ordered to attend vocational interview must attend even though claimant appealed from Order

In Bradley v. W.C.A.B. (County of Delaware), No. 343 C.D. 2006, claimant was ordered to attend a vocational interview. Claimant appealed to the Appeal Board and while the appeal was pending, claimant refused to attend the interview.

Insurer filed a Suspension Petition, averring that claimant’s benefits should be suspended for failing to attend the interview. The WCJ granted the Petition, ordering a suspension until such time that claimant attended the interview.

Claimant appealed and the Appeal Board affirmed the WCJ’s granting of a suspension of benefits. On that same day, the Appeal Board also issued an Opinion affirming the WCJ’s initial Decision ordering claimant to attend the vocational interview.

Before Commonwealth Court, claimant alleged that the WCJ’s Decision suspending benefits was erroneous because there was no evidence that she failed to attend the vocational interview. Meanwhile, insurer pointed out that the parties agreed claimant did not attend the vocational interview so this alone was sufficient to support the suspension of benefits.

The Court agreed with insurer that the WCJ’s suspension of benefits was supported by the evidence as the parties agreed that claimant did not attend the interview. The Court went on to hold that the fact that claimant had appealed from the WCJ’s initial Decision directing her to attend the vocational interview did not excuse her from attending the interview because an Appeal alone does not operate as an automatic supersedeas. Therefore, even though claimant appealed the Decision directing her to attend the vocational interview, she was still required to attend the interview or face a possible suspension of benefits.

Penalties awarded for checks received by claimant 37 days after approval of Compromise and Release Agreement

In the matter of Mercer Lime and Stone Company and Old Republic Insurance Company v. W.C.A.B. (McGallis), No. 2008 C.D. 2006, the WCJ issued an Order on October 18, 2004 approving a Compromise and Release Agreement providing for the payment of $100,000.00 to claimant.

On November 5, 2004 insurer sent claimant’s check but the check was not signed so it was returned to insurer. On November 18, 2004, 30 days after the Order approving the Compromise and Release Agreement, claimant filed a penalty petition. After the filing of the penalty petition, claimant’s check was issued on November 22, 2004.

Before the WCJ, the claims adjuster testified that the mailing of the check, without a signature, was an honest mistake. More importantly, the adjuster also testified that defense counsel had advised him that claimant had not signed a resignation letter so the adjuster was told to “hold onto the check” in order to speed up the signing of the resignation letter. In light of the testimony from the adjuster, the WCJ imposed a 5% penalty. The Appeal Board affirmed.

Before Commonwealth Court, insurer argued that the obligation to mail the check did not run until the expiration of the 20-day appeal period from the circulation date of the WCJ’s Decision. Since the 20-day appeal period expired on November 7, 2004, the check issued on November 22, 2004 was timely.

It has generally been felt that an insurer has 30 days from the date of an award in which to issue payment without the fear of penalties being imposed. However, Commonwealth Court in Mercer Lime and Stone refused to come out and hold that there is a 30-day “penalty-free” period. Commonwealth Court only chose to hold that a 5% penalty was appropriate in the case because the delay was due to the attempt to have the resignation letter signed.

Even though the Court refused to hold that there is this 30-day penalty-free period for the payment of benefits, the Court did acknowledge in footnote #8 of its Opinion that instantaneous payment is not possible. The Court suggested that whether the delay in payment was inappropriate so as to justify an award of penalties was to be decided on a case-by-case basis. The Court seemed to endorse a “rule of reason” approach that looked to see whether insurer acted with reasonable diligence in the issuance of checks.

When Appeal filed and Supersedeas granted from an Order approving a Compromise and Release Agreement, penalties not appropriate for a delay in issuing payment

In the matter of Gregory v. W.C.A.B. (Narvon Builders), No. 2021 C.D. 2006, the WCJ issued a Decision on December 22, 2003 approving a Compromise and Release Agreement.

Claimant was murdered eight days after the Compromise and Release Agreement was approved by the WCJ. Insurer filed a timely Appeal from the WCJ’s Order on the basis that claimant did not understand the full significance of entering into the Compromise and Release Agreement and that claimant was under duress when entering into the Agreement. Insurer also filed a Petition for Supersedeas.

The Appeal Board granted the Petition for Supersedeas which meant that while the Appeal was pending, insurer did not have to issue the lump-sum payment as set forth in the Compromise and Release Agreement. Eventually, insurer decided to withdraw its Appeal and checks were mailed to claimant’s counsel, including interest from the date the appeal period ended through the date the check was issued.

Claimant’s estate filed a Penalty Petition on the basis that insurer violated the Act by not timely issuing the checks. The WCJ denied the Petition because insurer filed a timely Appeal and supersedeas was granted so there was no obligation to send the checks. The Appeal Board affirmed.

Commonwealth Court affirmed, concluding that an imposition of penalties was not appropriate since insurer filed a timely Appeal and a Petition for Supersedeas that was granted. The Court concluded that claimant failed to prove that there was a violation of the Act since insurer followed the mandates of the Act in filing an Appeal and have supersedeas granted. Commonwealth Court also refused to grant a penalty based on claimant’s argument that the Appeal to the Appeal Board was frivolous. The Court determined that a WCJ has no authority to determine that the Appeal Board erred in granting supersedeas and the WCJ had no authority to determine if insurer’s Appeal was frivolous.

Penalties awarded when insurer does not pay following an Order from Commonwealth Court

Insurer in Graphic Packaging v. W.C.A.B. B. (Zink) and Zink v. W.C.A.B. (Graphic Packaging), No. 1066 C.D. 2006 and No. 1544 C.D. 2006, argued that it had no obligation to pay following Commonwealth Court’s earlier Opinion involving the same parties, because in the earlier Opinion, Commonwealth Court remanded the matter to the WCJ and the Remand Order did not expressly direct insurer to pay a specific amount to claimant.

Claimant commenced the initial round of litigation by filing a Claim Petition averring that he was exposed to abnormal working conditions when his employer changed his shift, which in turn aggravated his pre-existing PTSD. This Claim Petition was denied and the denial was affirmed by the Appeal Board. However, Commonwealth Court in Zink v. W.C.A.B. (Graphic Packaging), 828 A.2d 456 (Pa. Cmwlth. 2003), held that claimant did prove abnormal working conditions and remanded the matter to the WCJ for, “an appropriate award.” This Opinion was issued on July 10, 2003.

Following the remand, the WCJ awarded benefits and also awarded 40% penalties based on insurer’s failure to issue payment immediately after Commonwealth Court’s July 10, 2003 Opinion.

Insurer appealed the award of penalties and Appeal Board affirmed. Before Commonwealth Court, insurer argued that the Court’s July 10, 2003 Opinion did not direct insurer to pay a sum certain so the Opinion did not impose an obligation on insurer to pay claimant any benefits.

The Court rejected insurer’s argument that its July 10, 2003 Opinion did not award claimant benefits. Instead, the Court held that its July 10, 2003 Opinion, at the very least, entitled claimant to benefits from July 24, 1996 through January of 1997, so insurer’s failure to pay benefits after July 10, 2003 justified the WCJ’s award of 40% penalties.

City not entitled to have judgment opened since City refused to issue payment under a WCJ’s award

In Clayton v. City of Philadelphia, No. 1036 C.D. 2005, No. 1037 C.D. 2005, No. 2434 C.D. 2005 claimant, a police officer, began receiving a service connected disability pension. Thereafter, claimant filed a Claim Petition. The WCJ awarded benefits and the City did not appeal this Decision but the City also did not issue payment.

Claimant filed a Reinstatement Petition and a Penalty Petition because of the City’s failure to pay benefits. The City contended that it did not owe past due workers’ compensation benefits, because it was entitled to an offset for the disability pension that claimant had been receiving. Meanwhile, the evidence shows that the City never filed a Notice of Offset of Workers’ Compensation Benefits.

The WCJ ordered the City to pay claimant all past due compensation benefits, without an offset or credit, because the City failed to file a Notice of Offset, or request a credit when the original Claim Petition was litigated. The City appealed and the Appeal Board denied the City’s request for supersedeas.

The City eventually filed with the Bureau, two Notices of Benefit Offset. One seeking a credit for pension benefits received by claimant as of August of 2004 and thereafter. The other one sought a retroactive credit for pension benefits received by claimant from January of 1998 through August of 2004.

Because the City still refused to pay benefits, Claimant filed a Praecipe to Enter Judgment with the Prothonotary of Philadelphia County. (FYI, by the time of the filing of the Praecipe to Enter Judgment, claimant was owed in excess of $300,000.00). The City responded by filing a Petition to Open Judgment and also to Set Aside the Writ of Execution. The Trial Court denied both Petitions. The City filed an Appeal from the Trial Court’s Decision. Claimant then filed a second Praecipe to Enter Judgment. The City again filed a Petition to Open Judgment and Set Aside the Writ of Execution. Once again, the Trial Court denied the City’s Petitions and once again the City appealed.

Before Commonwealth Court, the City argued that it had actually “paid” the judgment when it filed its Notice of Offset against the pension benefits received by clamant. However, Commonwealth Court rejected this argument, holding that to allow the City to refuse to pay benefits according to the WCJ’s Order on the basis that it was entitled to a credit, would be a collateral attack on the WCJ’s initial granting of the Claim Petition. The Court also held that when an employer has not paid benefits within 30 days of an award, claimant is entitled to have the Prothonotary issue a judgment for the entire amount owed. The Court held that the judgment entered will only be lifted if it is established that there was no Order granting compensation; that 30 days had not passed since the Order affixing payment; supersedeas had been granted; or that the amount owed, had been paid. Because the City met none of these conditions, the City was obligated to pay. The Court concluded that an allegation that there was an error with respect to a WCJ’s Decision is not a basis for lifting a judgment.

Insurer’s contest unreasonable when it failed to introduce any evidence in opposition to Reinstatement Petition

In Wood v. W.C.A.B. (Country Care Private Nursing), No. 1272 C.D. 2005, insurer chose not to offer any evidence in opposition to claimant’s Reinstatement Petition and while the Reinstatement Petition was granted, the WCJ refused to award attorney’s fees for unreasonable contest. Claimant appealed and the Appeal Board agreed with the WCJ.

Commonwealth Court reversed and held that insurer’s contest was unreasonable as the Court determined that while claimant had the burden of proving a right to a reinstatement of benefits, insurer had the burden of proving its contest was reasonable. The Court noted that that insurer’s defense was that claimant called her treating doctor to testify as opposed to her surgeon. The Court concluded that insurer’s defense was that a negative inference should be drawn by claimant’s failure to call her surgeon. However, the Court refused to make this inference and instead the Court suggested that there was no reason insurer could not have called the surgeon. The Court also determined that insurer’s failure to present any evidence contrary to claimant’s evidence made insurer’s contest unreasonable as a matter of law.

Further modification of benefits appropriate under an Earning Power Assessment even though claimant found work on his own

In CRST v. W.C.A.B. (Boyles), No. 1954 C.D. 2006, claimant found work on his own but because he had a wage loss he was receiving partial disability benefits. Insurer had a Labor Market Survey performed and a Modification Petition was filed seeking a further reduction of claimant’s benefits.

Initially, there was a prolonged series of litigation that ended up with Commonwealth Court remanding the matter to a WCJ. The second time around, the WCJ determined that claimant had an earning power of $455.60 under the Labor Market Survey, which was less than the actual wages he was earning. However, the WCJ refused to grant insurer’s Modification Petition reasoning that once the Notice of Ability of Return to Work was issued, and claimant found work on his own, he had fulfilled his obligations and insurer could not seek a further modification. The Appeal Board affirmed, holding that once a claimant secures work on his/her own after receiving a Notice of Ability of Return to Work, the insurer is precluded from establishing an earning power based on a Labor Market Survey.

Commonwealth Court reversed, holding that an insurer is not precluded from submitting earning power evidence even if claimant has found work on his/her own. The Court reasoned that there is nothing in the Act or Regulations preventing insurer from providing expert evidence as to claimant’s earning power if that claimant is working.

Therefore, even if a claimant is working, securing an Earning Power Assessment may be used to further reduce a claimant’s benefits.

Supreme Court rules no obligation to prove ongoing job availability after already been determined that claimant’s refusal to accept position was in bad faith

The Supreme Court in Pitt Ohio Express v. W.C.A.B. (Wolff), No. WAP 2005, was asked to address the employer’s burden of proof in a Suspension Petition when benefits had been reinstated following a surgery, when before the surgery, claimant’s benefits had been suspended because a WCJ had found that claimant had failed to pursue a job in good faith.

Claimant suffered a work injury on April 3, 1996 and as of November 4, 1997, a WCJ granted employer’s Suspension Petition on the basis that claimant failed to pursue, in good faith, a modified position offered to him Claimant underwent back surgery in September 2000 so his benefits were reinstated. In October of 2001, employer filed a Suspension Petition averring that claimant had recovered sufficiently to perform the modified position that was the basis of the prior suspension of benefits. During the litigation, claimant acknowledged that he could physically perform the modified position that was available to him as of November of 1997.

The WCJ granted the suspension of benefits, but the Appeal Board reversed, concluding that employer failed to show that the modified petition was still available. Commonwealth Court reversed and reinstated the WCJ’s suspension of benefits, holding that employer did not have to again prove job availability when claimant was able to perform the modified position he had previously rejected.

The Supreme Court affirmed Commonwealth Court holding that claimant’s previous bad faith relieved employer of the requirement to again demonstrate that a suitable position was available. The Court held that an employer cannot be given a never ending duty to keep a job available to a claimant who rejects it in bad faith. The Court suggested that if it allowed a claimant to reject a job in bad faith and then place a burden on the employer to provide the claimant another job whenever the claimant chooses, this would reward the initial bad faith conduct.

Termination from employment due to excessive absenteeism related to work injury does not rise to level of bad faith or willful misconduct.

Claimant in Shop Vac Corp. v. W.C.A.B. (Thomas), No. 217 C.D. 2007 suffered a compensable work injury in February of 2002 and employer fired her in May of 2003 for violating the company’s attendance policy.

Claimant’s testimony was that after her work injury, the major cause for her absenteeism was headaches and neck pain caused by the work injury. Meanwhile, employer presented testimony that claimant was terminated for violating the company’s attendance policy for having too many unexcused absences. The WCJ credited claimant’s testimony that her absences were mostly due to the work injury and concluded that claimant was entitled to benefits after her firing.

Before Commonwealth Court, employer argued that it has a policy requiring written excuses to explain absences so even if claimant’s absences were due to the work injury she still had an obligation to follow the company’s policy. Meanwhile, claimant suggested that employer’s evidence failed to prove one way or the other that she was terminated for not providing excuses or was terminated for using too many sick days which would have been chargeable against her even, if she had given excuses.

Commonwealth Court affirmed the award of benefits to claimant on the basis that the WCJ credited claimant’s testimony that her absences were due to the work injury and the Court concluded that there is no reason that debilitating pain from a work injury can not serve as a good cause to explain excessive absenteeism. The Court held that claimant’s conduct was not in bad faith and did not rise to the level of willful misconduct so the Court concluded she was entitled to benefits after her termination.

Unfortunately, the Court’s ruling in Shop Vac may lead to claimants calling off work due to pain from a work injury and it will be difficult for employers to disprove these pain complaints. Although, if a claimant were to do it time and time again without seeking medical attention, it certainly would raise a red flag that the pain may not be as severe as claimed.