Commonwealth Court Holds Expert Can Posit the Existence of Disease Causing Agent in Section 301(c)(1) Case

In Craftex Mills, Inc. of PA v. WCAB (Markowicz), the Employer tried to apply the evidentiary requirements for proof of occupational disease exposure as stated by the Supreme Court in Gibson v. Workers’ Compensation Appeal Board (Armco Stainless), 580 Pa. 470, 861 A.2d 938 (2004).

In the Gibson case, the Supreme Court, while coincidentally appearing skeptical of the Claimant’s expert medical testimony, held the Claimant did not meet his burden to show asbestosis. The Court stated there must be evidence there was asbestos in the plant, and the Claimant’s lay witness was unsure if the grey dusty material on the pipes leading from the boiler was, indeed, asbestos. See post.

In the Craftex Mills case, the Claimant’s physician testified the Claimant suffered from "hypersensitivity pneumonitis and asthmatic bronchitis as a result of his exposure to thermophilic actinomyces in the air conditioning unit." emphasis in original. The WCJ awarded benefits under Section 301(c)(1) of the Act. The Court stated: "The Judge was impressed by Dr. Mengel’s discussion of the diagnosed condition and its epidemiology." The Board and Court appeared to be similarly impressed.

On appeal, the Employer noted Dr. Mengel admitted not all air conditioning units have thermophilic actinomyces. The Employer pointed out there was no lay evidence that thermophilic actinomyces were present. The Court applied the Gibson test and agreed there was no competent lay testimony to establish that thermophilic actinomyces were present.

However, the Court found Dr. Mengel’s testimony competent on its own. Dr. Mengel explained he concluded the Claimant was exposed to thermophilic actinomyces from the air conditioning system because the Claimant had no history of other exposure such as from "mushroom houses, tree de-barking facilities, and areas in which pigeons roost."

This is reasonable, but indistinguishable from Gibson, in which the Claimant’s doctor surely would have reasoned the Claimant was not exposed to asbestos anywhere other than at work.

The Court in Craftex Mills pointed out post hoc testing could show thermophilic actinomyces were not present, even if they were present at the time of the injury. This would not be the case with asbestos, which would be still there or should be the subject of a record of removal and disposal. The Court also pointed out the Claimant in this case proved his case completely under Section 301(c)(1) rather than relying on the presumption of causation in a case of occupational disease. Based on these factors, the Court chose to defer to the expert opinion rather than placing an onerous burden on the Claimant.

Article on Supreme Court Arguments in Motor Coils MFG/WABTEC, v. WCAB (Bish)

Law.com has an article from the Legal Intelligencer about argument before the Supreme Court in Motor Coils MFG/WABTEC, v. WCAB (Bish). The Employer is clearly arguing it can make light duty available to a Claimant who has moved out of state and suspend benefits when she refuses the job. If a labor market survey proves there is light duty work available under these circumstances, benefits can be suspended.

The difference in the Bish case is that the job was created by the Employer. There is no evidence the Claimant could have found the job in the general labor market. If this tactic does not deny equal protection as discussed in Shapiro v Thompson, 394 U.S. 618 (1969), the Supreme Court may validate it.

Commonwealth Court W.C. Filings Down; Court Credits Workers' Compensation Mediation

In an article in the Legal Intelligencer, President Judge James Gardner Colins and G. Ronald Darlington, the Executive Administrator of the Commonwealth Court, identified compromise and release and its progenitor, workers' compensation mediation, as factors in the fourteen per cent (14%) decline of workers' compensation filings in the Commonwealth Court.

In mediations I conducted last week I settled two out of two, and achieved very fair results for parties that were situated to enter into a compromise and release. The expertise of the Workers' Compensation Judges who mediate as well as the Mediating Commissioners of the WCAB and the Mediating Judges of the Commonwealth Court is directly responsible for the reduced filing numbers and the resulting improvement in disposition time.

Judge Colins also acknowledged the requirement of Harkness v. UCBR that Employers be represented by attorneys in unemployment compensation cases was a factor in an 18% drop in appeals from the Unemployment Compensation Board of Review to the Commonwealth Court.

Commonwealth Court Excuses Employer From Performing Labor Market Survey To Get Suspension Upon Claimant's Move Out Of United States

The Commonwealth Court issued its decision in M. Blong v. WCAB (Fluid Containment, et al.), a case I posted on in connection with the Supreme Court's grant of appeal in Motor Coils MFG/WABTEC, v. WCAB (Bish). These are cases where the claimant was released to return to work with restrictions, but the Claimant has moved out of state.

The twist in these cases is the amendment to Section 306(b)(2) that provides when the Claimant does not reside in the Commonwealth, earning power can be shown using a labor market survey in the usual employment area where the injury occurred. In both of these cases the Employer could have filed for modification or suspension based on a labor market survey of jobs in Pennsylvania.

In Bish, the Employer made a job available at the Employer's facility. The Commonwealth Court denied modification or suspension because the job was not local to the Claimant as required by Kachinski. The Supreme Court granted the Employer's petition for appeal.

In Blong, no work was made available and there was no labor market survey. The Claimant had moved to New Zealand. In prior litigation I denied a petition for termination, but found the Claimant was capable of working with restrictions.

I suspended benefits based on Smith v. WCAB (Dunhill Temporary Systems), 725 A.2d 1285 (Pa. Cmwlth. 1999). In Smith the Claimant's benefits were suspended when he joined the Peace Corps and relocated to Africa. I was convinced a labor market survey in the Mt. Union, Pennsylvania area would be "irrelevant and fruitless" in the words of the Commonwealth Court in Smith. The Board and the Court affirmed.

The Commonwealth Court said the critical factor is removal. The Court held the Claimant was as removed from the workforce as he would be if he was incarcerated or retired. In effect, the Claimant "quit" the Mt. Union, Pennsylvania job market, so that the Employer doesn't have to show job availability.

Under Kachinski and Bish the Court could have analyzed whether the move was in good faith. There was no evidence it was not -- Mr. Blong's wife is a native of New Zealand.

In Bish, the Supreme Court may address how the amendment to Section 306(b)(2) and its interaction with Smith affects the Kachinski requirement that available work must be local to a claimant who has moved out of state in good faith. Employers may not be excused from conducting the labor market survey in all of these cases. The Constitutional right to travel as stated in Shapiro v Thompson, 394 U.S. 618 (1969) may even be implicated.

Claimant Fails to Show Cause Why His Benefits Should Not Be Suspended

In my post on County of Allegheny (Department of Public Works) v. WCAB (Weis) I indicated the Commonwealth Court's holding allows an employer to file against a claimant a rule to show cause why the claimant's benefits should not be suspended. The employer filed one of these in E. Hepler v. WCAB (Penn Champ/Bissel, Inc.).

The scenario arises when a claimant takes a disability retirement. If a physician has released the claimant to any level of work, the employer can file a rule on the claimant to show cause why the claimant's benefits should not be suspended. This is done by filing a modification/suspension petition alleging the claimant has voluntarily removed himself or herself from the workforce.

This petition was filed in the Hepler case. The WCJ found the claimant was forced into retirement by the work injury and denied suspension, but the Board reversed based on the Weis case. The Commonwealth Court affirmed, finding the Weis case controls. The Commonwealth Court stated it is the claimant's burden in this case to show the claimant has not voluntarily withdrawn from the entire labor market and is open to employment within the claimant's physical capabilities.

Commentary on Gardner

Legal Intelligencer Article on Gardner.

Commonwealth Court Holds Employer is Responsible for Repair and Replacement of Orthopedic Appliances Before They Fail

In D. Zuback v. WCAB (Paradise Valley Enterprise Lumber Co.) , the Claimant had stair glides installed after his injury, which invloved the loss of an arm and a leg. When the stair glides became worn out, the Employer and Insurnce Carrier denied repair or replacement of the equipment under Bombay v. Workmen’s Compensation Appeal Board (South Erie Heating Co.), 572 A.2d 248 (Pa. Cmwlth. 1990). In that case, reasonable home modifications were made and additional home modifications were denied.

The stair guides were working, although wear and tear was evident in all parts of the mechanical operation. It was perhaps on this basis that the WCJ and Board denied the Claimant's request for repair or replacement. The Court, however, reversed and held the Employer and Insurer are responsible to (in this case) replace the stair glides before they fail as a reasonable home modification.

WCJ May Accept Self-Employment Earnings On Tax Return Over Vocational Expert Testimony

In Acme Markets, Inc. v. WCAB (Brown), the Commonwealth Court reviewed a WCJ's decision wherein the WCJ accepted the Claimant's statement of his self-employment income as reflected on his tax return, after deductions. The Employer argued the Claimant's gross income was a more accurate measure of his earning power. The Claimant had taken deductions for business expenses and a salary for his wife for secretarial and bookkeeping services.

The WCJ rejected the testimony of the Employer's vocational consultant as to average earnings of appraisers (the Claimant's self-employed occupation) secretaries and bookkeepers. The Court highlighted the reasons given by the WCJ for rejecting this testimony and found the WCJ's decision was reasoned. The Court affirmed.

PCRB Requests 8.5% Rate Reduction

The Pennsylvania Compensation Rating Bureau requested an average 8.5% reduction in loss cost level. The reduction is attributed to a decreasing number of claims and a moderation of the rate of increasing severity of the claims that are filed. The Pittsburgh Business Times published an in depth article, which also mentions there are more insurers writing policies in Pennsylvania and more competition over rates.

Supreme Court Affirms Denial of Supersedeas Reimbursement in Case of Refusal of Reasonable Medical Treatment

In Department of Labor & Industry v. WCAB (Excel Logistics), the employer won a petition for suspension alleging the claimant's refusal to undergo reasonable medical treatment. However, the employer's petition for supersedeas reimbursement was denied because the case did not involve a request for modification, suspension or termination under Section 413 or 430 of the Act.

The Commonwealth Court and Supreme Court held a forfeiture of benefits under Section 306(f.1)(8) is not a change in disability status as provided for in Sections 413 and 430. Accordingly, Section 443 does not allow supersedeas fund reimbursement.

The Supreme Court did not comment on what remedy the employer has against the claimant who was found to have forfeited his benefits. In light of this decision, the logical remedy would be a credit against the reinstated benefits when the claimant elects the treatment at issue.

Supreme Court Affirms Gardner, But Holds Employer Can File a Petition to Modify Based On Later IRE

In Gardner v. WCAB (Genesis Health Ventures) and Wal-Mart Stores, Inc. v. WCAB (Rider) the Supreme Court addressed the mandatory language of Section 306(a.2)(1) of the Act which requires that an employer have an IRE within sixty (60) days of the Claimant's receipt of 104 weeks of temporary total disability benefits.

The Court easily disposed of Rider. In that case, the 104 weeks passed while the case was still in litigation. The Commonwealth Court then allowed the employer to request the IRE within 60 days of the final order. As I recall, the Commonwealth Court opinion allowed the reader to assume supersedeas had been granted in the case, and the claimant did not receive the benefits until after the final order.

Actually, supersedeas as to indemnity benefits had not been granted. The claimant did receive the 104 weeks of benefits prior to the final order. Consistent with Gardner, the IRE request was untimely and the Supreme Court so held, reversing the Commonwealth Court.

The Supreme Court affirmed Gardner, holding the statutory language is clearly mandatory.

The Supreme Court then turned to Section 306(a.2)(6). This section provides an Employer may have only two independent medical evaluations in a twelve (12) month period, codifying the rule of thumb among WCJs for many years. However, in this section an independent medical evaluation is also referred to as an appropriate vehicle for determining the status of impairment.

A theory about the application of Section 306(a.2)(6) held that if there was no IRE within the 60 day window, there was nothing to review in a later IRE. The Supreme Court held that even if the Employer misses the sixty (60) day window in Section 306(a.2)(1), the Employer can request a later IRE. The Supreme Court did this by creating a presumption that the Claimant's impairment is greater than 50% if the Employer does not request the IRE in the first 60 days following the receipt of 104 weeks of benefits.

Furthermore, the Supreme Court held that when the employer requests the IRE after the 60 day window expires, the employer is not entitled to file a self-executing LIBC-764 Notice of Change of Workers' Compensation Disability Status. Section 306(a.2)(5) of the Act provides it must be adjudicated or agreed that the claimant's condition has improved to an impairment rating that is less than fifty per centum (50%).

Accordingly, the employer must ask the claimant to sign a supplemental agreement endorsing the IRE findings. Many will sign, since the claims representative will explain their benefits will not stop for 500 weeks.

For claimants who follow others' advice to "sign nothing", the employer will have to file a modification petition. Claimants will have no practical defense to this petition. Claimants will seek counsel, who will advise only the few whose impairment may exceed 50% should incur the cost of a claimant's IRE. The supplemental agreement will be signed. The claims representative will get claimant's counsel's phone number for the claims representative's file.

The final group of claimants will not sign and will not seek counsel, but will verify that the relief the employer is seeking will not stop their benefits, at least for 500 weeks. They will then be no-shows at the hearing like claimants who return to work and do not sign supplemental agreements. The WCJ will accept the IRE in evidence and issue a decision endorsing its findings.

WCRI Report on Provider Choice

The Workers' Compensation Research Institute (WCRI) issued a report entitled The Impact of Provider Choice on Workers' Compensation Costs and Outcomes. The report states panel physicians produce objectively better results, which WCRI attributes to an employer and carrier's superior resources in choosing physicians (Liberty Mutual is touting their system to put an even finer point on this).

WCRI's report admits employees report greater satisfaction with physicians they choose. The authors state this response is inconsistent with the poorer return to work outcomes and higher costs of employee chosen providers.

The rub of course is how the provider balances the conflicting interests of the employer and employee. A procedure that makes excessive medical and disability costs apparent to the employee would control costs without the dissatisfaction of restriction of choice.

Insurance Journal Article

Update: A similar study by the Public Policy Institute of California (using Pennsylvania among others as representative states) made similar findings, but with a twist. If the Claimant chose a physician not on the panel, but who the Claimant had seen before, outcomes vs. a panel doctor were not significantly different. The obvious inference would be that the pre-defined preexisting condition could not become part of the work injury in these cases. Article