Maryland Legislative Updates
ACTS AMENDING THE TOTAL AMOUNT OF DEATH BENEFITS PAYABLE TO PARTIALLY
DEPENDENT INDIVIDUALS UNDER LE §9-682 EFFECTIVE JULY 1, 2009
Senate Bill 863/House Bill 899
The Maryland Legislature has increased the amount of total death benefits payable to partially dependent individuals, to include an increase in the total amount of benefits payable to from $60,000 to $75,000 under LE §9-682 (c0(2) and (d)(2).
In addition, the Legislature has ordered the Workers' Compensation Commission to establish a committee comprised of stakeholders to study death benefit provisions, requiring the Commission to report its findings and recommendations on or before December 1, 2009, to specified committees of the General Assembly.
The changes to the Act will be applied to claims for death benefits filed on or after September 1, 2007, and will take effect on July 1, 2009.
Any questions regarding this legislation can be directed to Jamie L. DeSisto at (410)752-0075 or jdesisto@tthlaw.com.
PROPOSED REGULATION AFFECTING VOCATIONAL REHABILITATION
A little over a year ago he Maryland Workers’ Compensation Commission created a committee comprised of stakeholders to develop a new regulation addressing vocational rehabilitation. The Commission has proposed a new regulation on February 26, 2009 that affects vocational rehabilitation services and that significantly changes the existing law. Highlights of the proposed regulation as follows: (1) If the parties cannot agree on a counselor, then the Commission will pick a counselor from candidates selected by the parties; (2) There will be an expedited procedure for a hearing within five days of a request by any party in the event that there is a dispute over vocational rehabilitation; (3) The Employer/Insurer will have to continue payment of benefits until the issue is resolved by a hearing; (4) Once a stipulated rehabilitation plan expires, the vocational counselor is required to make recommendations for additional action, and if the parties cannot agree on a recommendation, a hearing will be set within five days to address the issue; (5) The Commission will be given the discretion to award attorney fees in disputes arising out of VR issues when deemed necessary.
At a public hearing on April 23, 2009 the Commission advised that the proposed legislation will be submitted to the Attorney General for drafting, and will be available for further public comment in the next six months.
Any questions regarding this legislation can be directed to Jamie L. DeSisto at (410)752-0075 or jdesisto@tthlaw.com.
1% INCREASE IN UEF ASSESSEMENT EFFECTIVE JULY 1, 2009
On May 28, 2009 the Uninsured Employers Fund Board directed the Workers’ Compensation Commission, pursuant to authority under LE §9-1007(a) to assess an additional 1% on awards of permanent disability or death, including awards for disfigurement, and settlement agreements approved by the Commission, effective July 1, 2009.
Significant Maryland Case Summaries
IN ORDER TO PREVAIL ON NOTICE DEFENSE, EMPLOYER MUST PROVE PREJUDICE THAT HAMPERED THE DEFENSE TO THE CLAIM
Elste v. ISG Sparrows Point, LLC, et al., 2009 Md. App. LEXIS 170 (October 29, 2009)
Claimant alleged that she sustained compensable injury to her knee arising out of and in the course of her employment as a crane operator. Claimant alleges that she notified her supervisor on the date of the occurrence, who denied that she notified him of the injury. Claimant did not seek medical treatment despite experiencing some pain and swelling in her knee, and continued to work full duty the following day and the next week. The following week, Claimant went on a prescheduled vacation, a camping trip. During the vacation, her knee became increasingly swollen. When she returned, she sought medical treatment for her knee for the first time. She was diagnosed with a "medial meniscal tear" and "effusion." Immediately after her appointment, Claimant went to the Sparrows Point dispensary and filled out an Accident Intake Form. About a month later, she underwent surgery to repair her right knee. A couple of months later, she filed a workers’ compensation claim.
The claim was contested on the basis of timely notice, accidental injury, and causal relationship. After a hearing the WCC found in favor of the Claimant on all issues. The Employer appealed. On appeal, after a trial by jury, the WCC Order was reversed in part. The jury held that Claimant sustained an accidental injury but failed to give timely notice. The Claimant filed a motion for judgment notwithstanding the verdict, which was denied by the Circuit Court. Claimant appealed, alleging that the trial court err in denying her motions for judgment and motion for judgment notwithstanding the verdict ("JNOV") when the employer presented no evidence that it suffered any actual prejudice as a result of a nine-day delay in receiving notice of the injury.
The Court noted that LE 9-704(b)(1)requires that a claim be reported within 10 days of the date of the injury. However, LE 9-702 provides a presumption that sufficient notice was given to the employer. Finally, LE 9-706(a) will excuse a failure to give timely notice unless the Employer can show prejudice. The Court noted that the Employer, as the party challenging the WCC decision, had the burden to establish that Claimant did not provide notice and that they suffered prejudice as a result.
The Employer argued that there was evidence of prejudice because the delay prevented them from evaluating Claimant’s condition prior to the camping trip, thus precluding a "before and after" comparison of her injury. The Claimant argued that the Employer did not provide any substantive evidence to support their assertion of prejudice, or any evidence that an investigation even occurred. The Court agreed, holding that in order to meet its burden of production on the issue of prejudice, The Employer would have to produce evidence that a change occurred in Claimant's condition, the scene of the accident, or the memory or availability of witnesses, etc., from day 10 after the accident to day 19, that hampered their defense to the claim. The Court noted that “an employee's mere participation in some intervening activity, or an employer's inability to conduct an immediate investigation, cannot, by themselves, constitute prejudice.
EMPLOYER IS ENTITLED TO JUDICIAL REVIEW OF AN ORDER ISSUED BY THE WCC, DENYING THE EMPLOYER'S REQUEST TO REFER A WORKER'S COMPENSATION CLAIM TO THE INSURANCE FRAUD DIVISION
Montgomery County v. Willis, 187 Md. App. 514; 979 A.2d 209 (2009)
Claimant obtained compensation benefits for a work related injury sustained in July 2001. The Employer alleged that after the work injury, but before benefits were awarded, the Claimant sustained a non-work related injury that she failed to disclose. On that basis, pursuant to LE § 9-310.2 Employer filed a request for hearing for referral to the Maryland Insurance Fraud Division. After an evidentiary hearing, the WCC determined there was insufficient evidence of fraud, and declined to refer the matter to the Fraud Division. The Employer appealed. The Claimant moved to dismiss the appeal, arguing, inter alia, that the Commission's Order was not appealable. The circuit court agreed and dismissed the appeal.
On appeal, the sole issue to be decided was whether an employer is entitled to judicial review of an Order issued by the WCC, denying the employer's request to refer a worker's compensation claim to the Insurance Fraud Division (the "Division") of the Maryland Insurance Administration. The Court of Special Appeals held that an Employer is entitled to judicial review because the legislative purpose of the fraud provisions (to protect employers/insurers and the public by helping to assure the integrity of the workers' compensation system) would be thwarted without judicial review of the Commission's decision, whether the decision happened to grant or deny a referral request based on alleged fraud.
WHEN MAKING A DETERMINATION OF STATUTORY EMPLOYER LIABILITY, THE QUESTION OF WHETHER THE CLAIMANT IS A COVERED EMPLOYEE UNDER THE ACT IS DETERMINED BY THE CLAMANT’S RELATIONSHIP TO THE PRINCIPAL EMPLOYER
UEF v. W.M. Schlosser Co., Inc., 975 A.2d 221 (Ct. Spec. App., July 7, 2009)
Claimant was employed by Rose Industrial Services, a subcontractor of W.M. Schlosser Co., Inc. Claimant worked for W.M. Schlosser, Inc. in a limited capacity on one job site in the District of Columbia, where he sustained a compensable work injury. However, Claimant was hired in the state of Maryland and worked for the subcontractor in several locations, including several in the State of Maryland. Claimant’s direct employer, Rose, was uninsured in the State of Maryland. At the workers’ compensation hearing, the Commissioner held that under LE 9-508, the statutory employer is only liable to pay compensation they would have been liable to pay if they were the direct employer. The Commissioner further held that since there would be no jurisdiction over a claim against W. M. Schlosser Co., Inc. if it were the direct employer, it cannot be held liable as a statutory employer.
The UEF appealed the decision and the parties filed cross motions for summary judgment in the Circuit Court for Baltimore County. The Circuit Court ruled in favor of Schlosser, affirming the decision of the workers’ compensation commission. The UEF appealed to the Court of Special Appeals. Schlosser argued, and the Commission ruled, that Schlosser is not liable in Maryland because the only Schlosser project on which Johnson worked was located wholly outside the state and, therefore, with respect to his work for Schlosser, Johnson was not a "covered employee" under the Maryland Workers' Compensation Act ("the Act"). The UEF argued that the question whether Johnson is a covered employee under the Act is determined, in the first instance, by Johnson's relation to his immediate employer, Rose, and that Schlosser otherwise meets the statutory criteria for liability as Johnson's statutory employer. The Court of Appeals agreed with the UEF, holding that (1) LE § 9-508 presupposes a finding that the injured employee is a covered employee under the Act; (2) the construction of the statute espoused by the Fund furthers the oft-stated public policy and purpose of the statute, which is to ensure that general contractors ensure that their sub-contractors carry valid workers’ compensation insurance; and (3) the result impresses the liability for similar claims upon a regulated insurer, rather than upon the UEF.
Any questions regarding this case can be directed to Jamie L. DeSisto at (410) 752-0075 or jdesisto@tthlaw.com.
PARTY WHO PREVAILS AT THE WCC CANNOT BE DEFEATED BY MOTION FOR SUMMARY JUDGMENT OR DIRECTED VERDICT UNLESS WCC DID NOT HAVE MINIMUM EVIDENCE NECESSARY TO SUPPORT AWARD, OR THE ISSUE IS A QUESTION OF LAW
Bridgett v. Montgomery County, 975 A.2d 231 (Ct. Spec.App. 2009)
Claimant, a firefighter, alleged he sustained an occupational disease (Dupuytren’s contracture) arising out of and in the course of his employment with Montgomery County. The Employer contested compensability. At a hearing before the Commission, the Claimant testified that his job duties had required repetitive use of the hands for thirty years. Medical opinions regarding causation were offered by both sides. The Commissioner found in favor of the Claimant.
On appeal, the Employer prevailed on a motion for summary judgment wherein it argued that it was entitled to judgment as a matter of law because (1) §9-502 requires not only that the alleged condition be inherent in the nature of the employment, but that it does not occur with equal frequency in any other employment; (2) the WC Act was not intended to cover common perils of life such as overuse of the hands. The Claimant argued that the presumption that the Commission’s opinion was prima facie correct prohibited the Employer from prevailing on a Motion for Summary Judgment.
The Court recognized that the general rule is that where the Claimant prevails at the Commission, the Court could not order Summary Judgment or a Directed Verdict. Exceptions to that rule include situations where (1) the WCC did not have the minimum evidence necessary to support an award; or (2) the issue decided as a pure question of law. The Court determined that the findings of the Commission in the present case were primarily fact-driven, and not purely questions of law. The Court went on to analyze if the Commission had minimum evidence to support its decision. It reviewed national case law to determine if Dupuytren’s contracture had been accepted as an occupational disease in other states. It determined that the results were mixed, and seemed to turn on a factual analysis on a case by case basis. The Court concluded that the Commission had undergone a similar factual analysis in the present case, and thus had the minimum evidence necessary to support its decision. As such, it was improper for the lower court to disregard the presumption. The Court reversed and remanded the case for a full trial on the merits.
Any questions regarding this case can be directed to Jamie L. DeSisto at (410) 752-0075 or jdesisto@tthlaw.com.
UM/UIM INSURER WAS ENTITLED TO A SET-OFF UNDER § 19-513(E) FOR (1) THE AMOUNT THE PLAINTIFF RECEIVED FROM THE ALLEGED TORTFEASOR'S INSURANCE COMPANY; AND (2) THE MONIES THE EMPLOYER PAID OUT AS WORKERS' COMPENSATION BENEFITS THAT THE PLAINTIFF DID NOT REPAY
Blackburn, et al. v. Erie Ins. Group, 971 A.2d 368; 2009 Md. App. LEXIS 54 (Md.Ct.Spec.App. 2009).
Plaintiff insured filed a complaint for declaratory relief against defendant insurer, seeking a determination of what the proper deductions were from an uninsured/under insured motorist policy. Both parties moved for summary judgment. The insured challenged an order of the Circuit Court for Frederick County (Maryland), which granted the insurer's motion for summary judgment and declared that its liability was $ 3,694.
The Plaintiff was injured in a motor vehicle accident during the course of his employment with the United States government. The Plaintiff filed for and received Federal workers’ compensation benefits, and the Employer asserted a worker's compensation lien in the amount of $246,305.00. Plaintiff also pursued a third party action against the alleged tortfeasor, and the tortfeasor’s insurance company paid the Plaintiff its policy limits. The Plaintiff then paid the Employer $ 27,396 in reimbursement of the lien from the settlement proceeds. Plaintiff also sought to collect from his UIM coverage with Erie, asserting that UIM liability was $ 150,000 (the difference between the $250,000 UIM policy and the amount recovered from the tortfeasor).
Erie disagreed, and filed a Motion for Summary Judgment indicating that it was allowed to set-off the entire amount of the recovery from the tortfeasor plus the full amount of the workers’ compensation lien that that had not been repaid by the Plaintiff. The Plaintiff opposed, indicating that Erie should only be able to set off the money received in settlement from the tortfeasor. The Circuit Court granted Erie’s Motion for Summary Judgment, and the Plaintiff appealed.
On appeal, the Court of Special Appeals held that the plain language of Md. Code Ann., Ins. § 19-513(e) (2006 Repl. Vol.) allowed Erie to calculate the benefits payable under the underinsured motorist provisions of its policy by deducting from its $ 250,000 limits: (1) the amount that the Plaintiff received from the alleged tortfeasor's insurance company ($100,000.00) and (2) the monies the Employer paid out as workers' compensation benefits that the Plaintiff did not repay, which was over $ 218,000.
DECEDENT’S CLAIM FOR UM/UIM BENEFITS MUST BE REDUCED UNDER § 19-513(E) TO THE EXTENT OF THE UN-REIMBURSED WORKERS' COMPENSATION BENEFITS RECEIVED WHERE THE DECEDENT NOT FILE A FORMAL WORKERS’ COMPENSATION CLAIM BUT RECEIVED WORKERS’ COMPENSATION MEDICAL BENEFITS
Parry, et al. v. Allstate Ins. Co., 2009 Md. LEXIS 38 (Ct. App., April 6, 2009)
Maryland Code, Insurance Art. § 19-513(e) provides that uninsured/underinsured motorist ("UM/UIM") benefits are to be reduced to the extent the recipient recovers related benefits under workers' compensation laws for which the provider of the workers' compensation benefits has not been reimbursed. Md. Code, Ins. § 19-513(e) (2006 Repl. Vol. & Supp. 2008). The issue presented in this case is whether, under Ins. § 19-513(e), the un-reimbursed medical expenses paid on behalf of an employee by his/her employer, pursuant to workers' compensation requirements, may be deducted by the employee's private insurance carrier from his UM/UIM policy coverage benefits if the employee never filed or pursued independently a formal workers' compensation claim.
The Circuit Court for Baltimore County, ruling on Respondent Allstate Insurance Co.'s ("Allstate") petition for declaratory judgment, concluded that the un-reimbursed medical expenses paid on behalf of County Police Officer Mark Parry by his employer, Baltimore County (or its insurer), pursuant to workers' compensation law, reduced to zero the UM/UIM policy liability of Allstate to Petitioner Lynne Parry (wife of Officer Parry, and personal representative of his estate) (the "Parrys"), even though the Parrys later elected the statutory remedy of bringing an action in tort against the tortfeasor, rather than filing a workers' compensation claim. In an unreported opinion, the Court of Special Appeals affirmed.
The Court of Appeals issued a writ of certiorari upon the Parrys' petition, and affirmed the Court of Special Appeals. The Parry’s argued that because they had not filed a formal workers’ compensation claim, they had not recovered benefits as set forth in § 19-513(e). The Court of Appeals rejected this argument because under the language of Ins. § 19-513(e), insurers are required to reduce PIP and UM benefits payable under such policies to injured employees by the amount of workers' compensation benefits paid for which the provider of the workers' compensation benefits has not been reimbursed. Md. Code, Ins. § 19-513(e), and it did not matter whether a formal workers’ compensation claim had been filed because the County's (or the insurer's) payment of Officer Parry's medical expenses means that the Parrys "recovered" workers' compensation benefits.
Any questions regarding this case can be directed to Jamie L. DeSisto at (410)752-0075 or jdesisto@tthlaw.com.
THE DETERMINATION WHETHER A DEVICE OR SERVICE IS COMPENSABLE MEDICAL TREATMENT UNDER LE § 9-660(A)(1) IS A QUESTION OF FACT THAT SHOULD BE DETERMINED UNDER THE CIRCUMSTANCES OF THE PARTICULAR CASE. A TRIER OF FACT COULD CONCLUDE THAT A HOME SECURITY SYSTEM WAS MEDICAL TREATMENT UNDER THE FACTS AND CIRCUMSTANCES OF THIS CASE, WHERE THE CLAIMANT WAS BRUTALLY ATTACKED, WHERE SHE SUFFERED BOTH PHYSICAL AND MENTAL DISABILITY AS A RESULT OF THE ATTACK, AND WHERE HER TREATING NEUROPSYCHOLOGIST RECOMMENDED A HOME SECURITY SYSTEM TO IMPROVE HER MEDICAL CONDITION
Simmons v. Comfort Suites Hotel, et al., 2009 Md. App. LEXIS 37 (Ct.Spec.App., March 31, 2009)
This appeal arises from injuries that Ms. Simmons received while working as a night auditor at the Comfort Suites Hotel in Chestertown, Maryland. On September 25, 2006, at approximately 2:00 a.m., she was brutally attacked with a baseball bat during an attempted robbery of the hotel. Ms. Simmons filed an uncontested claim with the Workers' Compensation Commission (the "Commission") for the injuries she sustained in the attack. Comfort Suites paid for medical treatment and temporary total disability benefits.
Ms. Simmons thereafter requested that Comfort Suites provide her with a home security system to allay her fear of a home intruder, which was recommended by her treating neuropsychologist. Comfort Suites did not introduce any medical evidence rebutting the neuropsychologist’s opinion. Rather, Comfort Suites argued that the Workers' Compensation statute did not cover a home security system because it was not "medical treatment" pursuant to the statute. In support of its position, Comfort Suites cited R & T Constr. Co. v. Judge, 323 Md. 514, 531, 594 A.2d 99 (1991), for the proposition that modifications to a home constitute medical treatment only when they provide "access for necessities," such as modifications that provide a quadriplegic access to physically travel in the home. The Commissioner disagreed, and issued an Order granting Ms. Simmons' request for a home security system.
On appeal to the Circuit Court for Queen Anne’s County, reversed, holding that the issue was a legal one, and not a factual one, and that the home security system is not something that's contemplated either by the statute or the Judge case.
The Court of Special Appeals reversed, holding that the determination whether a device or service is compensable medical treatment under LE § 9-660(a)(1) is a question of fact that should be determined under the circumstances of the particular case. The Court reasoned that under the unique circumstances of this case, where the claimant was brutally attacked, where she suffered both physical and mental disability as a result of the attack, and where her treating neuropsychologist recommended a home security system to improve her medical condition by reducing her anxiety and resulting insomnia, the trier of fact could find that a home security system constituted medical treatment pursuant to the statute.
Any questions regarding these cases can be directed to Jamie L. DeSisto at (410)752-0075 or jdesisto@tthlaw.com.