Monday, September 29, 2014

Malingering and Modification of Total Disability via LMS/EPA

Malingering and the Employer Remedy for Modification of alleged Total Disability via a Vocational Expert Labor Market Survey and Earning Power Assessment.

An Employer may limit the time duration of total disability indemnity wage loss payments via an Impairment Rating Evaluation. (IRE) A successful IRE results in a limitation of Partial Disability Indemnity wage loss benefits for a duration of 500 weeks, albeit at the total disability compensation benefit rate.

An Employer may limit the amount and duration of indemnity wage loss benefits via a Petition for Modification/Suspension based upon:
 (i)    medical expert evidence of a post-injury physical capacity for a category of work;
(ii)    vocational expert evidence of a post-injury earning capacity via a Labor Market
        Survey (LMS)  and an Earning Power Assessment (EPA);
(iii)   compliance of the employer job offer obligations.

What is the medical evidence requirement for Modification/Suspension?

The Supreme Court of Pennsylvania stated that the employer must demonstrate, with medical evidence, that the claimant's current physical condition has changed since the time of the last disability adjudication. See: Lewis v. WCAB (Giles & Ransome, Inc.), 919 A.2d 922 (Pa. 2007). 

The necessary change in condition has been defined as "any change in the claimant's physical well-being that affects his ability to work. Lewis 919 A.2d at 926. [...not very helpful].

"... it can be the total recovery from an illness or merely the symptoms [have] subsided."
919 A.2d at 926.

Where a modification is based upon earning capacity, it is not necessary to demonstrate that a claimant's diagnoses have changed since the last proceeding, but only that his symptoms have improved to the point where he is capable of gainful employment. 

See: Simmons v. WCAB (Powertrack International), No. 2168 C.D. 2013, a decision of a panel of the Commonwealth Court of Pennsylvania authored by Judge Leadbetter on July 24, 2014.

Factual and Procedural Background

Employee received total disability benefits for a 2001 work injury described as a closed head injury resulting in post-concussive syndrome.
Employer was unsuccessful in 2 prior Termination Petitions.

The WCJ did not make specific findings regarding Employee's condition in denial of the 2nd Termination petition He found employee credible that his subjective complaints remained the same as at the time of the 1st Termination petition proceedings.

In the 1st Termination petition the WCJ credited Dr. Taylor and Employee that  he suffered from depressive disorder, cognitive disorder, post-concussive syndrome.
Symptoms were: headaches, unsteadiness, memory problems, reduced activity, reduced social interaction, depression.

Employee medical evidence (credited by the WCJ) found the symptoms consistent with the diagnoses; there were no signs of symptom magnification or malingering; Employee was not capable of returning to work.

Employer Modification Petition Medical Evidence

Eric Fishman, Ph.D, a neuropsychologist, evaluated Employee in February 2008, administered neuropsych testing and review prior medical records and test results.
His diagnosis was probable malingered neuro-cognitive dysfunction.
He opined Employee was capable of returning to full-time employment.
He reviewed and approved the jobs which were include in the LMS/EPA vocational expert report.

[NOTE: Employee alleged ongoing symptoms, limited activity and disability. His use of a computer was disputed. However, Public website postings included on-line greetings, comments on photos, and other communications. Surveillance documented travel and attendance at auto races].

WCJ Decision

The WCJ made specific findings regarding Employee's activities and the inconsistency with his assertions of total disability!

WCJ granted Employer's petition for Modification.
WCAB Affirmed WCJ decision.
Employee appealed to Commonwealth Court.

Employee Appellate Argument:
The Employee argued Employer failed to demonstrate his condition had changed since the last termination petition proceeding. The Commonwealth Court rejected this argument.

Commonwealth Court Reasoning

"Contrary to Claimant's position, a diagnosis of malingering can be a sufficient change in condition as a matter of law to support a modification of benefits, if it leads the medical expert to conclude that the claimant's disability or ability to work has changed". slip opinion page 10.

Here, the Employer medical expert opinion was supported by evidence of Employee's activities and the WCJ observation of Employee at several hearings, which suggested Employee's subjective complaints were not as severe as he described or had improved since the last proceeding.

The fact that other medical experts found valid test performance and no signs of malingering five (5) years earlier did not preclude a current diagnosis of malingering.


1. This appellate decision provides an additional basis for modification. We know we need to establish a "change" in Employee medical condition. There is some debate as to what "change" is required to establish Employer's burden to proof. 

We know from Folmer v. WCAB (Swift Transportation) (Pa. Cmwlth. 2008) that a "change" in the evaluation of the credibility of claimant's "pain complaints"  can be a sufficient change of condition.  Simmons adds to that line of thinking. 

2. As Employer can never be certain that the WCJ will find claimant "no longer credible", it is prudent to attempt to establish a change of claimant's status via medical expert evidence of:
 (i) a change of physical capabilities; 
(ii) a change of physical exam findings; 
(iii) a change of reported symptoms.

3. Simmons also demonstrates the value of investigation of claimant activities, as a means to challenge claimant's credibility. Examination of public information from social media may document discrepancies from the claimant's professed status. This preliminary (low-cost) type of review, may also form the basis for a more in-depth investigation and surveillance of activities. 

Thursday, September 4, 2014

Work-Related Medical Expenses - Who is entitled to Payment?

In the event of a compensible work injury, Employers and their workers' compensation Insurers are responsible for the payment of indemnity wage loss benefits and the payment of medical expenses which are reasonable, necessary and related to the work injury.

At times, during the delay associated with the litigation of a claim petition, the medical expenses may be paid by another public or private insurer. When this occurs, the parties must determine which entity is entitled to receive payment/reimbursement for any work-related medical expenses, which are awarded by the WCJ.

The simple question of medical expense payments may become complicated.

Evans v. WCAB (Highway Equipment and Supply Company), is a recent decision of a panel of the Commonwealth Court of Pennsylvania at No. 2252 C.D. 2013, authored by Judge McCullough on June 30, 2014, which addresses these medical expense reimbursement issues.

Factual and Procedural background

On January 20, 2009, Employee was awarded ongoing total disability indemnity wage loss benefits and medical expenses for a work injury which occurred in April 2007.

On February 16, 2009, Employee counsel informed Employer of the amount owed to Claimant and submitted a subrogation lien of Highmark Blue Shield for medical expenses paid in the amount of $29,995.59.

On February 27, 2009, Employee counsel filed a Penalty Petition for Employer's failure to timely pay the January 2009 award.

Employee evidence included: (1) Healthcare Recoveries (Highmark vendor) October 8, 2008 letter and statement for medical expenses of $29k paid by Highmark to Geisinger Medical Center; (2) Healthcare letter for agreement for payment of 20% of amount, paid as an attorney fee to Claimant counsel.

WCJ Penalty Petition Decision

WCJ Concluded Employer violated the Act.
Directed Employer to pay $29k to the health care provider, less the 20% attorney fee.

Employee Appealed to WCAB

Employee argued the $29k should be paid directly to employee, with statutory interest, minus the 20% attorney fee.

WCAB Remanded

WCJ Remand Decision

Submission of the October 8, 2008 Healthcare Recoveries letter proved that a subrogation lien had been established before the WCJ January 2009 decision.
(really? wasn't the lien letter presented on Feb 16, after the Jan 20 decision?).

On this basis, payment was not to Employee, rather payment was to Healthcare Recoveries.
No interest was payable.

[WCJ would not allow Employer to take evidence that the Highmark lien was moot because Geisinger repaid the $29k medical expenses to Highmark.]

Employee WCAB Appeal II

WCAB Decision II

WCAB affirmed WCJ remand decision.
Subrogation lien had been established before WCJ Decision,
Lien was properly preserved in accord with Boeing Helicopters v. WCAB (Cobb), (Pa. Cmwlth. 1998). 

WCAB held Frymiare v. WCAB (D. Pileggi & Sons), (Pa. Cmwlth. 1987) did not compel medical expense payment directly to Employee.
Here, (unlike Frymiare)  Healthcare Recoveries had protected the Highmark Blue Shield subrogation interest.
As Employer evidence of Highmark-Geisinger repayment was beyond the scope of WCAB remand, the WCJ properly declined to accept this evidence.

Commonwealth Court Appeal - Employee arguments

(1).  WCJ erred in failing to order medical expense payments directly to Employee.
(2).  WCJ erred in failing to award interest.
(3).  WCJ erred in determining that Highmark's subrogation lien had not been waived.

Commonwealth Court Decision

(1).  The second paragraph of section 319 provides a health care insurer with a right of subrogation.
These subrogation rights are not automatic or self-executing.
The party asserting these rights must exercise reasonable diligence.
This has been interpreted as asserting one's subrogation rights during the pendency of the claim proceedings.
[See: Independence Blue Cross v. WCAB (Frankford Hospital), 820 A.2d 868, 872 (Pa. Cmwlth. 2003.].

The Court concluded, medical expenses were not directly payable to Employee in this case, as Employee submitted into evidence the October 8, 2008 Healthcare Recoveries letter stating the Highmark Blue Shield subrogation lien.

This letter established that an agreement* for the subrogation lien was in place before the WCJ initial claim petition decision. Therefore the Frymiare decision does not compel a medical expense payment to this Employee!

*[note: this agreement was between employee counsel and Healthcare/Highmark] .

(2).  Interest was not payable to employee on the unpaid medical expenses as employee was not entitled to this payment.

(3). Highmark preserved and did not waive its subrogation lien.

The Commonwealth Court decision in Frymiare warrants further discussion regarding this medical expense payment issue. 

In Frymiare,  the claimant was awarded work comp indemnity wage loss benefits and reimbursement of his personal payments of medical expenses.
The claimant's private health insurer made some medical expense payments, but it did not seek subrogation in the claim petition proceedings. Claimant was not awarded these amounts.

The Commonwealth Court held that the claimant was entitled to payment of the medical expenses.
Employer/Insurer may not avoid their responsibility to pay for work-related medical expenses, on the basis that some other source may have initially defrayed theses medical costs.
In the absence of the assertion of a subrogation lien from his health insurer, claimant was entitled to payment for these medical expenses. (presumably, by contract, claimant would be responsible to repay his health insurer.)


1. Employers and Insurers must determine if there are any payments of work-related medical expenses by any private health insurer plan, whether it be employer-funded or employee funded.

In order to avoid these time consuming and costly post-claim decision issues, it behooves the parties to document the rights/responsibilities regarding all outstanding work-related medical expenses.

This review includes the right of reimbursement to Medicare/Medicad for any conditional payments

2. Attorneys - determine if you can reach a stipulation with Employee counsel as to the identity and amount any medical expense liens and which entity is entitled to reimbursement, in the event of a WCJ award. 

3. Employer/Insurers, do not spend 20% of the amount due!
Do not ask the claimant attorney to represent the interests of an employer-funded plan. 
Have your legal counsel submit any necessary documentation of the subrogation interest.