“Wind” Will This Ever End?

As we recently celebrated the 4th of July with family and friends, we must not lose sight of the Founding Fathers and formation of the Constitution. Interestingly, John Hancock was the only one to sign on July 4, 1776, while the others signed at a later date. We are fortunate that the Founding Fathers drafted the Constitution to incorporate a judicial system that allows people the opportunity to be heard as that luxury does not exist in many other places in the world. Often, the higher courts will have to decide issues from the lower courts to interpret a statute, applicability of the law, admissibility of evidence, etc. The workers’ compensation laws are subject to the same scrutiny as any other law or statute.

 

The Workers’ Compensation Act and system was created to provide a quick and efficient resolution to injured workers and the ability through the administrative courts to avoid the long delays that could ensue in the trial courts. Ironically, workers’ compensation claims can be tied up in litigation much longer than the trial courts which was not the intent of the legislature. While the hope and intent are clear, due to the many nuances and different interpretation of the workers’ compensation laws, there will continue to be disputes that arise.

 

While different in each state, workers’ compensation medical benefits are subject to a fee schedule set by the legislature. By statute, a medical provider could not collect payment for medical expenses beyond those paid by the plaintiff’s workers’ compensation insurer. The intent (hopefully) is to have a level playing field and no disputes over what fee is to be charged to avoid any delay to the injured worker for medical care.

 

Plain and simple, the cost for a medical benefit under a workers’ compensation claim is subject to a set fee by the legislature regardless of what the provider may charge outside of the system for the same service. This also, for policy reasons, provides some relief to the carriers given the volume of workers’ compensation claims. They will not be burdened with extreme medical costs providing medical benefits to claimants as medical providers are limited to the amounts under the fee schedule.

 

With that said, in May of this year the Colorado Court of Appeals rendered an opinion that focused on the admissibility of past medical expenses when the claimant/plaintiff is injured on the job and sues the third-party tortfeasor. The Court considered whether “billed” medical expenses versus what was actually “paid” were to be considered by the court and jury in awarding damages to a claimant/plaintiff. Before trial, the defendant had extinguished the insurer’s subrogation interest in the amounts paid by paying off the insurer’s claim for those damages.

 

The case was brought before the Court based on claimant/plaintiff’s appeal that the trial court erred in excluding evidence of the amounts “billed” by his medical providers and only admitted the amounts “paid” by the carrier for his medical care and treatment. The Court was to determine whether billed versus paid medical benefits were permitted in a third-party lawsuit.

The Court held:

  • The collateral source rule barred admissibility of the medical expenses paid by the workers’ compensation carrier.
  • The plaintiff could present evidence at trial of the higher i.e. “billed” medical expenses by the providers.

 

Briefly, claimant worked for United Airlines (“United”) and was struck by an employee of Delta Airlines (“Delta”) at Denver International Airport – both were driving similar luggage tug vehicles. Claimant’s injuries were in the course and scope of employment, therefore, admitted and his indemnity and medical benefits were paid by his employer pursuant to statute.

 

Claimant’s employer sought reimbursement and sued Delta and its at-fault driver. Claimant sued the same defendants to recover for his personal injuries related to his work injury. United’s claim against Delta was settled for $328,799.16 and the case was dismissed with prejudice leaving only claimant and Delta as parties. Delta admitted liability but disputed claimant’s claimed damages so the case went to trial. At the first trial, claimant was awarded $1.5 million but a new trial was granted due to misconduct by claimant’s attorney.

 

At the second trial (which interestingly was a bench trial), plaintiff was not allowed to provide evidence of the higher “billed” amounts from the providers for medical expenses but only the amounts actually “paid” by the employer. The plaintiff was awarded $259,176 in damages of which $194,426 was for economic damages. The court subsequently entered an order to set-off claimant’s economic damages by the amount defendant had paid to settle the workers’ compensation claim. Plaintiff argued this was not fair since his award for economic damages was reduced to zero.

 

The injured worker appealed. In its decision, the Court ruled that the collateral source rule applied to workers’ compensation benefits. The collateral source rule, or collateral source doctrine, is an American case law evidentiary rule that prohibits the admission of evidence that the plaintiff or victim has received compensation from some source other than the damages sought against the defendant. In Colorado, the first component requires a trial court to set off tort verdicts by the amount of certain collateral source payments received by the plaintiff unless the payments were made because of a contract entered into and paid for on the plaintiff’s behalf. § 13-21-111.6, C.R.S. 2018. The second component bars evidence of a plaintiff’s receipt or entitlement to benefits received from a collateral source, most often an insurance company, “because such evidence could lead the fact-finder to improperly reduce the plaintiff’s damages award on the grounds that the plaintiff already recovered his loss from the collateral source. Wal-Mart Stores, Inc. v. Crossgrove, 276 P.3d 562 (Colo. 2012).

 

The Court noted that “even though claimant did not personally pay premiums toward his workers’ compensation insurance, he gave consideration for the same in the form of his employment services.” Van Waters & Rogers, Inc. v. Keelan, 840 P.2d 1070, 1074 (Colo. 1992). The same holds true to the defendant, who did not contribute in any way to the premiums paid to him and, therefore, the benefits paid were wholly collateral to the defendant. Therefore, the collateral source rule applies, and the defendant may be responsible for plaintiff’s damages regardless of what was paid by the workers’ compensation carrier. “The Court rationalized this will prevent a wrongdoer from reaping the benefits of a contract to which he is not a party.” The National Law Review, Colorado Court of Appeals Permits Evidence of Billed Workers’ Compensation Benefits at Trial.

 

In further reasoning of its decision, the Court acknowledged the workers’ compensation statute provides that amounts billed in excess of the statutory fee schedule are “unlawful, void, and unforceable.” This statutory language effectively prevents the plaintiff, as a matter of law, from having any legal obligation to pay such billed amounts. The Court cited a decision from the Colorado Supreme Court that stated, “the fact a bill is uncollectable does not render it entirely irrelevant to the reasonable value of the medical services provided.” Volunteers of America v. Gardenswartz, 242 P.3d 1080 (Colo. 2010).

 

There was a dissenting opinion issued by the Court which identifies the effect this ruling will have for claims in the future. “To allow injured workers to pursue expenses against the defendant in excess of what workers’ compensation already paid for his/her injuries contravenes the intent and purpose of the Workers’ Compensation Act. In part, this now affords the injured worker a windfall which the Act was not designed to do.” The dissenting opinion also makes note that the court is in the position of enforcing unenforceable contracts since the billed amounts are void and unenforceable based on the fee schedule specific to workers’ compensation claims.

 

The opinion of the Court has certainly created a stir as it now essentially creates a windfall in favor of the injured worker and settlement with workers’ compensation carriers before trial essentially meaningless.

 

We will wait to see if the Court’s decision is brought before the Colorado Supreme Court for further review and determination of this now complicated, and to be highly debated, topic.

FINE, FINE EVERYWHERE A FINE – EXCESSIVE FINES BY DOWC

BACKGROUND

On June 3, 2019 the Colorado Supreme Court issued a published opinion captioned Colorado Department of Labor and Employment, Division of Workers’ Compensation v. Dami Hospitality, LLC, 2019SC47.  The decision involved a fine handed down by the DOWC against an uninsured employer.

FACTS

Dami Hospitality, LLC., (Dami) is the owner of a hotel in Denver that employs between 4 and 10 people at any given time.  Dami let its workers’ compensation policy lapse on July 1, 2005.  When notified of the violation for failing to maintain coverage Dami conceded the violation and paid a settlement in June 2006.  Just 2 months later Dami’s coverage lapsed again and it went without coverage from August 10, 2006 to June 8, 2007.  Dami maintained coverage from June 9, 2007 to September 11, 2010, but it’s coverage lapsed on September 12, 2010 and Dami went without coverage until July 9, 2014.

DOWC discovered the lapses and issued a notice requiring Dami to answer a compliance questionnaire and advised that Dami could request the prehearing conference over this issue.  Dami did not respond to this notification so a second notification was sent on June 25, 2014, with a compliance questionnaire and an option to set a prehearing conference.  On July 11, 2014 Dami sent in a certificate of insurance covering Dami from July 10, 2014 to July 10, 2015.

DOWC issued a specific findings of fact, conclusions of law and order dated October 30, 2014 fining Dami $841,200!  Under Section 8-43-409(1),(b), C.R.S.

For every day the employer fails or has failed to ensure to keep the insurance required by articles 40 to 47 of this title in force, allows or has allowed insurance to lapse, or fails or has failed to affect the renewal of such coverage: impose a fine of: (I) not more than two hundred and fifty dollars for an initial violation; or (II) not less than two hundred and fifty dollars or more than five hundred dollars for a second and subsequent violation.

A separate schedule of funds was promulgated under Rule 3-6(D) in conjunction with the statutory section classifying second and subsequent violations as follows:

Class VII 1-20 Days $250/Day

Class VIII 21-25 Days $260/Day

Class IX 26-30 Days $280/Day

Class X 31-35 Days $300/Day

Class XI 36-40 Days $400/Day

Class XII 41 Days $500/Day

The DOWC fine was based on this classification process.  Dami explained that its lapse in coverage was based on its reliance that others maintain coverage and that given its $50,000 a year payroll, it was unable to pay the fine.  DOWC treated Dami’s response as a petition to review and, in an effort to settle the fine dispute, offered to decrease the fine amount to $425,000.  Dami claimed, among other things, that the fine was in violation of the Eighth Amendment prohibiting excessive fines.  DOWC declined DAMI’s leniency request citing that the reasons for coverage lapse were within Dami’s control, that discretion on fine amount was not within its power and that it could not address the constitutional arguments.  Dami appealed and at the Industrial Claim Appeals Office (ICAO) level the issue was sent back to DOWC to consider various mitigating and non-mitigating factors.  The DOWC issued a subsequent Order declining the issue on remand, essentially stating that the graduated fines under the Rule take into account these mitigating and non-mitigating factors.  Dami again appealed to the ICAO which then simply affirmed the DOWC.

The case was ultimately appealed to the Colorado Court of Appeals which found that the DOWC abused its discretion by not considering various mitigating and non-mitigating factors as required by applicable case law.  The DOWC then petitioned for certiorari to the Colorado Supreme Court.

RULING

The Colorado Supreme Court considered whether the Eighth Amendment excessive fines clause applies to companies.  It concluded that this clause does apply to companies, finding that companies are subject to similar protections against excessive fines just as individuals.  The Colorado Supreme Court further found that fines are subject to proportionality test to determine if they are excessive.  The Court held that when a fine is imposed on a per diem basis, with each day being a separate violation, evaluation of whether the fine is excessive must be done with each daily fine.  Therefore, the whole matter was sent back to DOWC so the parties could have a potential evidentiary hearing over proportionality considerations.

IMPLICATIONS

The DOWC has been in the habit of issuing compliance/show cause orders and subsequent fines against noncomplying employers.  Many of these orders have appeared excessive and were the subject of newspaper articles.  In addition, the DOWC maintains a recently created uninsured fund designed to provide coverage for injured workers hurt on the job working for noncomplying employers.  This fund is, in part, funded by DOWC fines levied against noncomplying employers.  These orders are issued without any mechanism for an evidentiary hearing over the mitigating factors identified by the court in this Dami decision.  Given this decision, it appears evidentiary hearings may now need to be held in conjunction with the compliance/show cause orders issued by DOWC.  Other possible implications include finding or creating new funding mechanisms to help build-up the uninsured employers fund outside of fines and penalties.

If you have any questions about fines, or any other topics, please contact us.

 

NEW COLORADO LAW LIMITS OPIOID PRESCRIPTIONS

Colorado is addressing the ongoing opioid epidemic with an array of public and private initiatives.  Per the American Medical Association,  the state Medicaid agency (the Colorado Department of Health Care Policy and Financing [HCPF]) and the Division of Insurance (DOI) are spearheading the initiatives.  On March 16, 2018, the revised Guidelines for Prescribing and Dispensing Opioids were adopted by all six of Colorado’s prescribing and dispensing Boards: the Colorado Dental Board, the Colorado Medical Board, the State Board of Nursing, the State Board of Optometry, the Colorado Podiatry Board and the State Board of Pharmacy.  On May 21, 2018, then Governor, John Hickenlooper, signed Senate Bill 18-22, Clinical Practice for Opioid Prescribing.  The bill, which limits the number of opioid pills a healthcare provider can prescribe, went into effect immediately upon the Governor’s signature.  Under the new law, a prescriber must limit a patient’s initial prescription of an opioid to a seven-day supply, if the prescriber has not written an opioid prescription for the patient in the preceding twelve months.   All six dispensing Boards recommend a prescription of less than 50 MME per day and utilization of long-acting or extended relief formulations. These limits do not apply in certain discrete situations, including, if, in the judgment of the prescriber, the patient:

 

  • Has chronic pain that typically lasts longer than 90 days past the point of healing, as determined by the prescriber;
  • Has been diagnosed with cancer and is experiencing cancer-related pain;
  • Is experiencing post-surgical pain, expected to last longer than fourteen days due to the nature of the procedure; or
  • Is undergoing palliative care or hospice care designed to improve quality of life.

 

After the first prescription, the prescriber may exercise discretion in issuing a second-fill for a seven-day supply. In cases of a second-fill, the prescriber is required to check the Prescription Drug Monitoring Program (PDMP) database before prescribing additional opioids for the same  patient.  Failure to check the PDMP constitutes unprofessional conduct if the prescriber repeatedly fails to comply with this PDMP requirement.  The requirement to check the PDMP on a second-fill does not apply in situations exempting compliance with the seven-day first-fill, with two additional exemptions:

 

  • The patient is receiving the opioid in a hospital, skilled nursing, residential, or correctional facility; or
  • Is receiving treatment during a natural disaster or where mass casualties have taken place.

 

After the second opioid prescription, the law has no additional restrictions on the healthcare provider’s prescribing practices.

 

In keeping with SB 18-22, the Colorado Division of Workers’ Compensation recently released its amendments to Rule 18, W.C.R.P., the Medical Fee Schedule. The updated fee schedule took effect January 1, 2019.  While several important changes were made in the amended fee schedule rule for 2019, including inclusion of the most current CPT code terminology, HCPCS codes, Colorado Z-codes (state-specific billing codes) and Medicare’s most current National Physician Fee Schedule Relative Value file, with updated conversion factors, the amended rule also incorporates the revised physician prescription/dispensing restrictions on opioids.   The amended rule language provides:

 

Opioids classified as Schedule II or Schedule III controlled substances that are prescribed for treatment lasting longer than seven days shall be provided by a pharmacy.

 

The changes to Rule 18, W.C.R.P. suggest the Division of Workers’ Compensation intends to move forward and integrate any necessary modifications to drive full compliance with the new restrictions on physician dispensing of Schedule II and III opioids. Physicians prescribing chronic opioids through the Workers’ Compensation system are also expected to comply with Colorado’s Medical Treatment Guidelines, Rule 17, Exhibit 9, addressing chronic pain disorder.  While the Guidelines do not have the force of law, they are intended to assist practitioners in the safe prescribing and dispensing of opioids.

 

If  you have any questions about the Medical Treatment Guidelines, changes to the Medical Fee Schedule, or any other topics, please contact us.

 

The Ongoing Dilemma of Intermittent FMLA Leave

Intermittent FMLA leave is a giant thorn in the side of humanFMLA Leave resource professionals across the country. The struggle is that not all intermittent leave requests are equal. Here’s a look at some of the most common scenarios, and how to handle them. The FMLA allows employers some flexibility in granting different kinds of intermittent leave. Employees are entitled to take it for serious health conditions, either their own or those of immediate family members. The law also allows use of intermittent leave for child care after the birth or placement of an adopted child, but only if the employer agrees to it. It’s the company’s call. It’s not always simple, however. If the mother develops complications from childbirth, or the infant is born premature and suffers from health problems, the “serious health condition” qualifier would likely kick in. As always, it pays to know the medical details before making a decision.

 

Eligibility Is Not Automatic

Companies can successfully dispute employee claims to FMLA eligibility. Consider this real-life example: 

A female employee in Maine said she suffered from a chronic condition that made it difficult to make it to work on time. After she racked up a number of late arrivals – and refused an offer to work on another shift – she was fired. She sued, saying her tardiness should have been considered intermittent leave. Her medical condition caused her lateness, she claimed, so each instance should have counted as a block of FMLA leave. Problem was, she’d never been out of work for medical treatment, or on account of a flare-up of her condition. The only time it affected her was when it was time to go to work. 

The Court denied her claim for FMLA eligibility and indicated that intermittent leave is granted when an employee needs to miss work for a specific period of time, such as a doctor’s appointment or when a condition suddenly becomes incapacitating.  That wasn’t the case here, the judge said – and giving the employee FMLA protection would simply have given the woman a blanket excuse to break company rules.

Cite: Brown v. Eastern Maine Medical Center.

 

Designating Leave Retroactively

In order to maximize workers’ using up their allotted FMLA leave, employers can sometimes classify an absence retroactively. For example, an employee’s out on two weeks of vacation, but she spends the second week in a hospital recovering from pneumonia. Her employer doesn’t learn of the hospital stay until she returns to work. But she tells her supervisor about it, who then informs HR. Within two days, HR contacts the woman and says, “That week you were in the hospital should be covered by the FMLA. Here’s the paperwork.” The key here is that the company acted quickly – within two days of being notified of the qualifying leave. The tactic’s perfectly legal, and it could make a difference in the impact FMLA leave time could have on the firm’s overall operation. It’s also an excellent example of the key role managers play in helping companies deal with the negative effects of FMLA.

 

Using Employees’ Paid Time Off

Employers should never tell workers they can’t take FMLA leave until they’ve used up all their vacation, sick and other paid time off (PTO). Instead, companies can require employees to use their accrued PTO concurrently with their intermittent leave time. Employers can also count workers’ comp or short-term disability leave as part of their FMLA time – but in that case, employees can’t be asked to use their accrued PTO.

 

The Transfer Position

Companies can temporarily transfer an employee on intermittent leave, to minimize the effect of that person’s absence on the overall operation. The temporary position doesn’t need to be equivalent to the original job – but the pay and benefits must remain the same. And, of course, the employee must be given his old job – or its equivalent – when the intermittent leave period’s over.

There is one large restriction – the move can’t be made if the transfer “adversely affects” the individual. An example would be if if the new position would lengthen or increase the cost of the employee’s commute.  This would adversely affect the employee. Instead, such transfers need to be handled in such a way as to avoid looking like the employer is trying to discourage the employee from taking intermittent leave – or worse yet, is being punished for having done so.

 

Cooperation

Although FMLA is certainly an employee-friendly statute, employers do have some rights when it comes to scheduling intermittent leave. For instance, employees are required to consult with their employers about setting up medical treatments on a schedule that minimizes impact on operations. Of course, the arrangement has to be approved by the healthcare provider. But if an employee fails to consult with HR before scheduling treatment, the law allows employers to require the worker to go back to the provider and discuss alternate arrangements.

 

The Firing Question

Yes, companies can fire an employee who’s on intermittent FMLA leave. Despite the fears of many employers, FMLA doesn’t confer some kind of special dispensation for workers who exercise their leave rights. Obviously, workers can’t be fired for taking leave. But employers can layoff, discipline and terminate those employees who violate company policies or perform poorly. When an employee on FMLA leave is terminated, the Department of Labor decrees that the burdens on the employer to prove the worker would have been laid off, disciplined or terminated regardless of the leave request or usage.

 

Reductions in Force

When an employer has a valid reason for reducing its workforce, the company can lay off an employee on FMLA leave – as long as the firm can prove the person would have been let go regardless of the leave. However, again companies should be prepared not only to prove the business necessity of the move, but to show an objective, nondiscriminatory plan for choosing which employees would be laid off.

 

Misconduct or Poor Performance

Employees on FMLA leave – of any type – are just as responsible for following performance and behavior rules as those not on leave. However, companies that fire an employee out on FMLA will be under increased pressure to prove that the decision was based on factors other than the worker’s absence. As such, courts might well pose employers a key question: Why didn’t you fire this person before he/she took leave? This is not an easy answer to explain before a jury if liability is threatened at trial.  The good news is that a number of courts have upheld employers’ rights to fire employees on FMLA leave, even when the employee’s problems were first discovered when the employee went off the job. Nevertheless, companies should move cautiously if they are to terminate an employee currently out on leave due to misconduct or poor performance existing prior to the leave, but discovered after the leave begins.

 

Every case is different and requires different strategies and decisions because of the intricacies of the FMLA.  Hence, we highly recommend consulting in-house counsel, or one of our attorneys, to assist in making the appropriate decisions.

New Rule 11 – How’s It Going?

We’re now going on almost three months since the new Rule 11 took effect with the updated DIME fees and procedures.  Time flies, doesn’t it?   There has been some litigation that has ensued as a result of the recent changes, but overall the changes have been well received.  This is likely because most people prepared adequately for the changes that were taking effect well before the start of the New Year.

 

The litigation that has ensued has been primarily regarding the “regions” listed in the checklist contained on the Application for DIME and the body parts involved in the claim.   Since the “regions” have caused some confusion, the fees have also needed clarification.   Some of the litigation revolved around the specific body parts to a claim and Rule 11’s breakdown of cost.   The checklist looks as follows:

 

2019 DIME Application

 

Above each set of body parts, the boxes are listed as regions.  Pursuant to Rule 11, “less than three regions” is a fee of $1,000.   “Three or more regions” is a fee of $1,400.   It is recommended to double-check the Applications for DIME that are received to see if compliance with the Rule is met.   Any discrepancies and/or arguments concerning interpretation of the Rule can be handled by the Prehearing Administrative Law Judges.   The Judges have done an outstanding job of interpreting the Rule and correcting many issues for the DIME unit.  Also note, that some of the disputes have resulted in body parts that either were or were not related to the claim.   Such disputes have involved related body parts that should be part of the DIME, however claimants have tried to keep them out to lower the overall costs of the DIME.   Other disputes have arisen between the terms “and/or” as used in the Rule.  The arguments pertaining to the semantics have been resolved mostly using the word “or” to imply that either one or the other conditions must be met to trigger a particular fee.

 

 

In general, the DIME process seems to be running smoothly and interpretation of the new Rules seems to be pretty straightforward.   Like any Rule change, it will take some time to get used to and iron out the wrinkles.  It is important to double-check the new Rule and make sure compliance is met to avoid missing any particular arguments that will pose any sort of leverage in a claim.   Recall, that the new Rule only applies to Notices and Proposals filed on or after January 1, 2019.   Any Notice and Proposal filed before that date adheres to the old Rule 11.

 

If you have any questions regarding the changes to the Rules or the updated statutes, feel free to contact us.

 

Workplace Bullying

Does workers’ compensation insurance cover mental, and manifesting physical injuries Workplace Bullyingresulting from workplace bullying? A recent Forbes online article cited a survey concluding that 75% of the U.S. workforce reported having experienced workplace bullying.[1] Another study cited by the Workplace Bullying Institute suggested that absenteeism and lower production costs businesses $4 billion annually.[2] Regardless of the accuracy of the statistics, with the increased use of social media, workplace bullying can start inside of the workplace, or, start outside of the workplace and permeate into daily business operations.

One definition of workplace bullying advanced in Psychology Today was “workplace bullying refers to “situations where an employee repeatedly and over a prolonged time period is exposed to harassing behavior from one or more colleagues (including subordinates and leaders) and where the targeted person is unable to defend him-/herself against this systematic mistreatment.”[3] Researches have identified both internal and external causes of workplace bullying. As noted below, identifying the cause of workplace bullying is relevant to unwinding the legal liabilities associated with resulting injuries. Types of injuries associated with this behavior includes “physical and psychological symptoms, including headaches, chronic neck pain, fibromyalgia, type 2 diabetes, sleep problems, anxiety, depression, post-traumatic stress symptoms, suicidal ideation, and others.” [4]

The current statutory law in Colorado does not specifically address a company’s insurance liability for workplace bullying injuries. However, those injuries can be covered under the exclusive remedy of the Colorado’s Workers’ Compensation Act and the associated insurance policies. Bullying injuries may be treated as assaults for purposes of liability. Assaults that arise out of work are generally compensable injuries, while those that are purely personal are not.[5] Assaults caused by a natural force, or an event that any employee would be exposed to are also compensable assaults. Before addressing the nature of the injury, the business should investigate whether the bullying, for example verbal abuse or written harassments, arose out of a personal dispute between employees or whether the bullying occurred within the parameters of the employees’ business relations. Any investigation should be undertaken consistent with a business’ employment policies and procedures for interviewing witnesses, reviewing internal documents such as email, and confiscating company phones or computers as evidence.

When a business determines that a workplace bullying event has occurred, the business ought to determine whether an actual injury was caused by the perpetrator(s) conduct. The law is especially tricky when unpacking whether an injury occurred. While an employee may complain of stress or some other symptoms, especially to justify absenteeism, the claim may not always be a compensable injury. Section 8-43-301(2)(a), C.R.S., requires that an employee claiming a mental impairment provide a specific showing of a mental injury, including evidence supported by a licensed psychologist or psychiatrist. Additionally, whether the bullying itself was a crime of violence will also factor into the amount of benefits that could be owed to a victim-employee. Navigating through the patchwork of questions to determine liability hinges on the ability of a comprehensive investigation of the claim at the outset to determine its validity.

As always, if you have any questions regarding workers’ compensation insurance and laws, please contact us.

 

[1] https://www.forbes.com/sites/christinecomaford/2016/08/27/the-enormous-toll-workplace-bullying-takes-on-your-bottom-line/#5f464c0b5595

[2] https://www.workplacebullying.org/tag/workers-comp/

[3]https://www.psychologytoday.com/us/blog/finding-new-home/201809/workplace-bullying-causes-effects-and-prevention

[4] Id.

[5] Velasquez v. Industrial Commission, 41 Colo. App. 201,581 P.2d 748 (1978); In Re Questions Submitted by U.S. Court of Appeals, 759 P.2d 17, 23 (Colo. 1988).

Helmet to Helmet

It’s hard to believe that the 2018 NFL football season is coming to an end soon with Super Bowl LIII. And for the 16th time in 18 years a quarterback named Brady, Manning, or Roethlisberger will represent the AFC in the Super Bowl. This will be the 9th appearance for Patriot’s Quarterback Tom Brady while the Ram’s Quarterback Jared Goff makes his first appearance. The old vs. the new.

While we are indulging in hot wings, pizza, and libations at various Super Bowl parties, it is easy to lose sight of the fact that injuries to professional athletes fall under workers’ compensation insurance. Since these players are performing their job duties and, unlike amateur athletes, they are employees.

Professional football requires two types of insurance: general liability and workers’ compensation since it is mandatory under state laws. Given the lucrative contracts these athletes sign, the Collective Bargaining Agreements often require wage continuation agreements so that these athletes continue to make the same salary if they are injured and off work. Can you imagine an athlete who makes $30 million a year being capped at the state workers’ compensation rate while recovering from an injury? Hence why wage continuation agreements are standard across the league.

With that said, one of the biggest threats to the NFL is the evaporating insurance market. According to multiple sources from the NFL, there is only one carrier willing to provide workers’ compensation coverage for NFL teams because of all the concussion litigation that began in 2011. At that time, at least a dozen carriers occupied the insurance market for pro football. Now, there is one.  Dr. Julian Bales, Medical Director and member of the NFL’s head, neck, and spine committee told ESPN “insurance coverage is arguably the biggest threat to the sport.”[1]

A study done by the University of Pittsburgh Medical Center’s sports concussion program found approximately 300,000 football-related concussions occur each year in youth, high school, college, and professional. And the biggest injury or disease that is making headlines in the NFL is traumatic brain injuries and chronic traumatic encephalopathy or “C.T.E.” The problem with this disease is the unknown “trigger” on how and when the disease starts. The disease is diagnosed after death and the symptoms of depression and delusional behavior may lay dormant for years, or even decades, before they surface. It’s concerning for carriers to know they could be on the hook years down the road given the unknown.

Similar to asbestos claims in workers’ compensation, a carrier can be at risk for a claimant who works one day and is subsequently diagnosed with lung cancer, players in California could file claims, even if they played only one game, to allege their brain disorders were caused by the sport. This cost carriers and the leagues hundreds of millions of dollars which fortunately was curtailed by new legislation in 2013. Still, carriers are cautious to cover the NFL without an exclusion for head trauma.

For many years carriers insured the NFL without restrictions for traumatic brain injuries. Now many of these companies are in a six-year lawsuit with the NFL over who will pay legal fees and claims associated with the 2013 settlement of the $1 billion-dollar class action lawsuit. Hence, these carriers are at higher risk to insure the NFL.

California has one of the most liberal workers’ compensation laws in the Union. Recently, former players who decades ago reached injury settlements with NFL teams and carriers have filed new claims alleging their settlements did not cover traumatic brain injuries. In 2015, a workers’ compensation court found that a former player’s 1989 settlement for cumulative industrial injury “does not extend to the then-unknown cumulative injury to the brain.” Similar to a worker who claims their shoulder pain is due to years of lifting heavy equipment, a former football player can argue their continued migraine headaches are a result of them playing professional football. Chances are several brain disorders like dementia, Parkinson’s and Alzheimer’s could be blamed on football. Doctors may ask, “how long did you play football and how many head injuries did you have?” and cite that as the cause for a claimant’s brain disorder when a claim against the NFL is filed. Fortunately, claimants must still meet their burden and prove that pro football alone, and not youth or college football, was the “cause” of their injury or diseases.

Workers’ compensation attorneys in California are handling numerous settled cases in which former NFL players have filed new claims for head trauma. The new claims will only increase costs for litigation and further deter carriers on what they will and will not cover. Fortunately, monetary costs for workers’ compensation claims are capped which will help put a cork in the damn but if the floodgate of old settled claims are allowed to be reopened, the market for coverage will continue to be washed away down the river…

As always, if you have any questions regarding workers’ compensation insurance and laws, please contact us.

 

[1] http://www.espn.com/espn/story/_/id/25776964/insurance-market-football-evaporating-causing-major-threat-nfl-pop-warner-colleges-espn

Rules Are Meant to be Broken – or At Least Updated. 2019 Rule Updates

2019 brings changes to two Rules that affect Colorado Workers’ Compensation. Rule 11 and Rule 16 have both been revised and the changes go into effect January 1, 2019. The changes to Rule 11and the DIME process are extensive. Below is a brief summary of the changes.

 

Rule 16 is undergoing a few changes.  The rule has been reordered.  Most of the changes are not substantive.  It is strongly recommended that the new rule be referenced in dealing with any prior authorization or billing issue for specifics.  The more substantive changes are highlighted below; however, the specifics of the rule should be reviewed in each situation.

  • ‘Payer’ definition is the same, but the definition now states that use of third parties to pay bills does not relieve the carrier or self-insured employer of obligations under the rules.
  • Recognized healthcare providers previously under 16-5 is now under 16-3.
  • Required use of the medical treatment guidelines, previously under 16-3 is now under 16-4
  • Notification requirements previously under 16-9 is now under 16-5.
  • Prior authorization previously under 16-10 is now under 16-6
  • Contest of prior authorization previously under 16-11 is now under 16-7.

* In conjunction with 16-11 in the new rule governing payment of medical benefits, contest for payment of prior authorization for non-medical reasons now contains examples of non-medical reasons including: no claim has been filed, compensability is not been established, the provider is not authorized, insurance coverage is at issue, typographic, gender or date errors on the bill, failure to submit medical documentation and unrecognized CPT codes.

  • Required use of the medical fee schedule previously under 16-4 is now under 16-8 and specifically sets forth the payment for build services without an established value under the medical fee schedule require prior authorization.
  • Required billing forms and accompanying documentation previously under 16-7 is now under 16-9 and has been added to somewhat.
  • Required medical documentation previously under 16-8 is now under 16-10 and sets forth in greater detail specifically what Form 164 should look like from the doctor’s office.
  • Payment of medical benefits previously under 16-12 is now under16-11.
  • Dispute resolution process previously under 16-13 is now under 16-12.
  • On-site review of hospital or other medical charges previously under 16-14 is folded into 16-10 regarding required medical record documentation.

 

Rule 11 changes are more substantial. Of Counsel, Brad Hansen, wrote an article about the updates last month and you can read it as well: Because It Goes to 11 – Rule 11 changes for 2019. 

 

The following is a brief summary of the Rule 11 changes:

Why?

  • No real change for years.
  • Doctors’ reluctance to continue to do DIMEs due to reimbursement and increased complexity.

 

Effective Date

  • January 1, 2019
  • DOWC says there is some leeway for the first month.

 

Overview of changes

  • Cost
  • Forms
  • Time-frames
  • Logistics

 

Cost

  • 3 tiers based on DOI, and number of body parts
  • $1,000 = DOI < 2 years and < 3 regions marked on the application
  • $1,400 = DOI > 2 years but < 5 years and 3 – 4 body regions marked
  • $2,000 = DOI > 5 years and ≥ 5 or more body regions marked

 

Forms

  • FAL – includes objection to the FAL, notice proposal and application for DIME
  • Request for Appointment to the DIME
  • Notice and Proposal and Application for DIME
  • DIME Examiner Summary Sheet
  • Notice of DIME Negotiations
  • Follow-up DIME
  • DIME Physician Summary Disclosure Form
  • Notice of Reschedule or Termination of DIME
  • Notice of Agreement to Limit the Scope of the DIME
  • DIME Report Template

 

Time-frames – font color corresponds to responsible party. Key to color below list.

  • FAL = 30 Days After Receipt of MMI (calendar 30 days after report for safety)
  • Notice and Proposal and Application for DIME = 30 Days After Filing of FAL
  • Claimant Files for Indigency = 15 Days After Filing the Notice and Proposal and Application for DIME
  • Attempt to Negotiate DIME = 30 Days After Notice and Proposal and Application (Notice of Negotiation Form to be filed within 30 Days)
  • DOWC Issues Panel = 5 days
  • Summary Disclosure Request = 5 Business Days
  • Requesting Party Strike If No Disclosure Request = 5 Business Days
  • Non-Requesting Party Strike = 5 Business Days
  • DOWC Send DIME Confirmation = 5 Business Days
  • Pay For and Schedule DIME = 14 Days
  • Schedule DIME = Between 35 – 75 Days After DIME Confirmation
  • Complete Copy of Medical Records to Claimant = 14 Days from DIME Confirmation
  • Claimant submits additional Medical Records to Carrier = 10 Days After Medical Packet From Carrier
  • Completed Packet Provided to DIME = 14 Days Before Exam
  • Claimant Notifies Carrier of Need for Interpreter = 14 Days Before Examination
    • Carrier is Responsible for Paying for the Interpreter
  • After DIME = 20 Days After Examination a Report is Generated

Key = Respondent duty       = Claimant duty     = Either Party’s duty

 

Logistics

  • New Rule applies to any Notice and Proposal with a certificate of service after 1/1/19
  • Applies to any follow-up DIME after 1/1/19
  • Applies to 24-month DIMEs

 

Questions

  • Body Parts?
    • The checklist proports to control body parts considered
    • PALJs likely to address
    • DIMEs still not confined to specific body parts
  • DIME Cancellation
    • Very tight cancellation time-frames with fixed penalties

 

The above summaries of Rule 11 and 16 are not intended to be used as legal advice. They are an outline of the changes to those Rules effective January 1, 2019. Please contact us for case specific legal recommendations.

BECAUSE IT GOES TO 11

It is hard to believe that the holiday season is here and, with that, 2019 will soon be upon us. 2019 Rule 11 revisionsWith the New Year, several changes and updates to the Workers’ Compensation Rules of Procedure will take place. One rule that will have significant changes and impact on the system is Rule 11, which pertains to the DIME process.

The DIME program has seen little change since its inception in 1991, yet it is an essential piece of the Colorado Workers’ Compensation system. There have been attempts throughout the years to change the procedures from both respondent’s and claimant’s bars but to no avail. After three years of collaboration and tedious consideration, the Division of Workers’ Compensation has finally adopted a new rule that will address key challenges of each stakeholder. This is due in part to weekly staff meetings with representatives from both sides of the bar commenting on the changes and individual meetings with each side of the bar. There were over 50 revisions to Rule 11 and a Public Rule Hearing held for additional comment.

 

Effective January 1, 2019, these revisions and changes to Rule 11 will take place. Several key changes to the Rule:

     

    • There will now be a three-tiered payment system based on the date of injury to the filing of the DIME application and the number of body regions indicated on the DIME application;
    •  
    • The DIME physician must receive the fee prior to the requesting party scheduling the DIME appointment;
    •  
    • The Notice and Proposal and DIME Application are now combined as one document;
    •  
    • The time-frame to schedule a DIME appointment is extended to no earlier than 45 days or later than 75 days after the requesting party receives the notice of the DIME Physician Confirmation; and
    •  
    • Parties will now be responsible for agreeing on a singular medical records packet to send to the DIME physician.

     

 

The Division Rule will go into place January 1st, but the Division has indicated there will be some leniency the first month to sort out compliance issues. By February the Division will be enforcing the new process. Any Notice and Proposal with a certificate of mailing dated on or after January 1, 2019 is subject to the new Rule 11 provisions.

 

One provision of the Rule that will be advantageous for respondents is the requirement that once a Notice and Proposal is filed, claimant must simultaneously file a DIME application. With the current Rule 11 provision, claimant could file a Notice and Proposal to perfect their jurisdictional requirement to object to the Final Admission of Liability but could wait on filing for a DIME. Sometimes it would be months, or even close to a year, before a DIME application was filed and physician selected. Hopefully, the new Rule 11 revisions will bring a speedier DIME process and claim resolution/closure.

 

One negative effect of the new Rule is that parties are now to agree on one set of medical records to be sent to the DIME physician. This could create more litigation as claimants may not want to provide certain records, but respondents may feel they should be included in the medical packet. A standoff could require pre-hearings to adjudicate the matter. This is likely why the Division extended the time requirement to 45 – 75 days so that parties have time to reach an agreement on the medical records submitted and additional time to set the DIME appointment.

 

With these changes to Rule 11, there will be a lot of questions that need to be addressed. The attorneys at Lee & Brown, LLC are here to answer any questions you may have regarding the new changes to Rule 11 and will be conducting training seminars “on our DIME” early next year to go over all these changes. Below are some helpful links from the Division of Workers’ Compensation which provides general DIME information and new timelines to consider.

 

https://www.colorado.gov/pacific/sites/default/files/DIME_Presentation_2019.pdf

 

https://www.colorado.gov/pacific/sites/default/files/Important_DIME_Timelines_2019.pdf

 

https://www.colorado.gov/pacific/sites/default/files/General_DIME_Fee_Information.pdf

 

 

Recovery of Overpayments in Workers’ Compensation Claims

The issue of overpayments has drawn much attention in recent years.   Several claimsOverpayment in WC Claims have gone up to the appellate courts regarding the jurisdiction and ability of the Division and an ALJ to order repayment of workers’ compensation benefits that were previously paid.  As you may imagine, repayment of several thousand dollars by a claimant is usually very difficult, if not impossible.  Employers and carriers usually protect themselves and recoup overpayment from future benefits owed.  Several cases have emerged, (as well as arguments from claimants), that recovery of over-payments is impermissible, unconstitutional, and burdensome.

 

The parties must always take into consideration that the workers’ compensation system is a gamble at every stage.   The parties often encounter substantial risk throughout the claim that could tip the scales in favor of one party or the other.  The Division IME is one such process.  Another example is a merits hearing and the ultimate determination of the ALJ.  Claimants risk that benefits paid earlier in the claim will suddenly become an overpayment based on the opinions of either a physician or a Judge, or both.

 

Pursuant to section 8-40-201(15.5), C.R.S., an overpayment is defined as: “money received by a claimant that exceeds the amount that should have been paid, or which the claimant was not entitled to receive, or which results in duplicate benefits because of offsets that reduce disability or death benefits payable under said articles. For an overpayment to result, it is not necessary that the overpayment exist at the time the claimant received disability or death benefits under said articles.”

 

Recovery of overpayments is permitted within the Act.  Many examples exist in which a claimant may have been paid money that they were not owed.  Most of the time, Respondents recoup an overpayment from PPD or future indemnity.  However, in a situation in which there are no future benefits owed, the Act allows for garnishment of the claimant’s assets upon filing of a final order with the district court.  Section 8-43-306(1), C.R.S. states, “A certified copy of any final order of the director or an administrative law judge ordering the payment of  any penalty  or  repayment  of  overpayments  pursuant  to  articles 40 to 47 of this title may be filed with the clerk of the district  court  of  any  county  in  this  state  at  any  time  after  the  period  of  time  provided  by  articles  40  to  47  of  this  title  for  appeal  or  seeking  review  of  the  order  has  passed  without  appeal or review being sought or, if appeal or review is sought, after  the  order  has  been  finally  affirmed  and  all  appellate  remedies and all opportunities for review have been exhausted. The party filing the order shall at the same time file a certificate to  the  effect  that the  time  for  appeal  or  review  has  passed without appeal or review being undertaken or that the order has been  finally  affirmed  with  all  appellate  remedies  and  all  opportunities for review having been exhausted. The clerk of the  district  court  shall  record  the  order  and  the  filing  party’s  certificate in the judgment book of said court and entry thereof made in the judgment docket, and it shall thenceforth have all the effect of a judgment of the district court, and execution may issue thereon out of said court as in other cases. Any such order may be filed by and in the name of the director or by and in the name of the party in the worker’s compensation action who was injured by the violation of any provision of articles 40 to 47 of this title  or  who  was  found  to  be  entitled  to  repayment  of  overpayments under said articles.”

 

It is quite difficult for a claimant attorney to explain to their client that money that was previously received by a claimant, now had to be paid back to the carrier.  For example, when a Division IME physician backdates the date of MMI, and TTD that was paid during the prior MMI period, now becomes an overpayment; a claimant is often left with the burden of understanding how a physician can retroactively find that MMI happened earlier in time.  Another example is recovery of benefits against SSDI that is being collected.  Claimant sometimes believe that they are entitled to SSDI and TTD/TPD concurrently without an offset.

 

Many arguments have been made to the appellate courts unsuccessfully regarding collection of an overpayment.  One such argument involves “monies due and owed at the time of payment.”  Any money paid to the claimant at the time it was owed should not be an “overpayment” pursuant to the Act.  This argument was addressed by the Court of Appeals and they declined to follow it indicating that the Act allows for repayment of monies in situations in which the money was never due in the first place.  It wouldn’t be surprising for this line of thinking to be quickly eroded by a legislative change in which an overpayment is defied expressly in the statute by other means in which the facts of a case would not change the overall intentions of the way it was written.

 

For now, Respondents have one-year from the date the overpayment exists or accrued to claim it.  If it is not claimed, it is considered waived.  If an overpayment of indemnity exists on a file, it is best to claim it right away and strategize with counsel how best to recoup the overpayment.  Sometimes, remedies can be worked out with the claimant to make both parties happy and ensure that there is not prejudice to either side.  It can certainly prevent an Order being granted which puts the claimant is a difficult position of having to make a repayment of monies, when in all likelihood the money is either gone and/or has a very little chance of being seen again.

 

If you have any questions regarding an overpayment, recoupment, or strategy regarding benefits on a claim; please contact us.