Impairment Rating Evaluation as the Employer's "Best" Remedy

Limiting the Duration of Total Disability Benefits via an Impairment Rating Evaluation.

The Employer and Workers' Compensation Insurer have a remedy to limit the duration of total disability benefits, via the scheduling of an Impairment Rating Evaluation (IRE) pursuant to Section 306 (a.2).

The requirements are straight forward. After an Employee receives 104 weeks of total disability benefits, the Employer may file a Request for Impairment Rating Evaluation LIBC-766 with the Bureau of Workers' Compensation.

The Bureau assigns the request to a medical expert, who is licensed in Pennsylvania and Board Certified in a Specialty. This physician must also be active in clinical practice, for at least 20 hours per week.

The examining medical expert must determine that the Employee has reached "Maximum Medical Improvement", before an evaluation can take place.
The medical expert must utilize the latest edition of the American Medical Association "Guides to the Evaluation of Permanent Impairment". 

If the degree of impairment is equal to or greater than 50% , in accord with the AMA Guides, then Employee is presumed to be totally disabled. 

If the degree of impairment is less than 50%, then Employee shall receive partial disability benefits. Partial disability status is for a maximum duration of 500 weeks.

Benefit status is changed by the filing of an LIBC-764, Notice of Change of Workers' Compensation Disability Status.
The rate or dollar amount of the benefits is not changed by the IRE. The "status" of the Employee benefits is changed, from a potential lifetime duration of total disability, to a limited duration of 500 weeks.

Question: What happens when an employee has an IRE, is placed on partial status and then undergoes work-related surgery ... which is totally disabling in nature?

Wingrove v. WCAB (Allegheny Energy), No. 1151 C.D. 2013,  is a reported decision of  a panel of the Commonwealth Court of Pennsylvania, authored by Judge Leavitt on January 3, 2014. The disability status of employee after surgery was addressed.

Factual and Procedural Background

Employee injured his low back while working as a laborer in November 2002.
An NCP was issued for a low back "strain".
He continued to work, until May 2003 when he underwent surgery. His low back pain worsened and he remained off work on total disability.

After payment of two (2) years of total disability benefits, Employer requested an IRE.
A May 1, 2005 evaluation by medical expert Jon B. Tucker, M.D. determined Employee was 11% impaired, in accord with the AMA Guides.
A Notice of Change of Disability Status was issued.

This change of status was automatic and self-executing as the IRE was requested within 60 days of the Employee's receipt of 104 weeks of compensation.
[See: Pa Supreme Court Decision at Gardner v. WCAB (Genesis Health Ventures) 585 A.2d 366 (Pa. 2005)]

May 18, 2009 ... Four (4) years later Employee filed two (2) petitions
In 2010, a Third Petition followed...

1. Review Description of Injury. This petition asserted, the 2002 NCP should be amended to include:

•   mood disorder with depressive, psychotic and hypomanic symptomatology;
•  a moderate to severe treatment-resistant pain disorder; 
• chronic severe low back pain.

2..Review IRE The IRE was defective as it did not take into account the above psychiatric problems.

3. Review Petition (2010) Lumbar fusion surgery of March 2010 rendered Employee more than 50% disabled, pursuant to the AMA Guides. Amendment of the NCP was requested to include:

•  post laminectomy syndrome and chronic L5 radiculopathy.

NOTE: In January 2011, during the WCJ litigation, the parties entered into a stipulation and agreed that Employee became totally disabled as of the date of the March 24, 2010 surgery, until November 29, 2010. As of November 30, 2010, Employee was returned to partial disability status. 

The parties agreed the execution of this stipulation (Supplemental Agreement) would not have any effect on any pending petitions or any future petitions. 

WCJ January 2012 Decision and WCAB Affirmation

A. Review Description of Injury
 Granted as to:

• chronic radiculopathy,
• post-laminectomy syndrome,
• chronic back pain,
• depression

Denied as to : psychosis.

B. Review IRE Petition

• Denied. Employee did not challenge the IRE within 60 days of the Notice of Change in Disability Status. 
• Expansion of the NCP did not negate the validity of the Dr. Tucker 2005 IRE.
• 2011 Supplemental Agreement did not render the 2005 IRE a nullity.

C. Review Petition 50% Impairment Argument

• Denied, Employee had the burden to prove that the additional recognized work injuries established a whole body impairment in excess of 50%. He did not meet this burden.

Commonwealth Court Affirmation and Reasoning

Employee argued:

 (1)  there was an error of law, once Employee became totally disabled, Employer had the burden of proof to re-establish Employee was partially disabled before they could change his disability status. 

(2) The Workers' Compensation Act violates the Pennsylvania Constitution.

Why does Employee lose this Appeal?

i.  Employee may challenge an IRE, on its merits, within 60 days of receipt of the Notice of Change form. After 60 days, the IRE is beyond challenge! He waited four (4) years. 

ii. Employee may obtain a new IRE after 60 days (within the 500 week partial disability status).

BUT to change his status from partial to total, he must establish an impairment of 50% or more. 

He did not obtain a new IRE.

iii. The 2012 WCJ decision amending the NCP did not render Dr. Tucker's 2005 IRE determination invalid. 

After 60 days it was fixed and beyond challenge.

iv. The burden of proof shifted to Employee to show that his addition of depression to the NCP rendered him at least 50 % impaired.

 Section 306 (a.2)(4) allows a change in disability status, but only where an impairment rating determination is equal to or greater than 50%. Employee did not do this. Employee did not meet his burden of proof. 

The Court rejected Employee argument that the Employer had the burden of proof to establish partial disability, after the Supplemental Agreement placed him on total disability status. 

[Recall: that agreement stated it would not have any effect on the pending or future petitions].

v. Constitutional Argument. Questions of the validity of a Statute may be raise on appellate review, even where not raised before the WCJ and/or WCAB. [Pa. R.A.P. 1551].

Employee argued that" in some circumstances his client would have been consider to be more than 50% impaired" ... but he did not assert a change in an edition of the AMA Guides which affected HIS 2005 IRE!

The term, "most recent edition" of the AMA Guides has been interpreted to mean the edition in effect at the time the IRE is conducted. See: Standish v. WCAB (James J. Anderson Construction Co.) 11 A.3d 569 (Pa. Cmwlth. 2010).

Employee did not "develop" his constitutional argument. slip opinion page 10. 

Practice Pointers:

1. Once again I emphasize, the IRE remedy is a relatively low-cost, low-effort remedy to limit the duration of workers' compensation indemnity wage loss benefits.

 EVERY work comp file should be diaried for payment of 104 weeks of total disability, for the prompt request of an IRE.

2. Another available remedy (available even before the payment of 104 weeks of total disability) is the remedy to establish a post-injury earning capacity via a Medical Expert Examination ...

... followed by an Employer job offer AND/OR a Labor Market Survey by a qualified vocational expert, leading to an Earning Power Assessment ... and a prima facie case for modification of total disability benefit payments. 

These are two remedies that should be employed in every workers' compensation case. 

These are the remedies available ... use them.

When is a NARTW required by the Employer?

*NARTW = Notice of Ability to Return To Work, LIBC-757.

The 1996 amendments to the Pennsylvania Workers' Compensation Act included the introduction of a "new" remedy for Modification of total disability wage loss benefits, based upon Vocational Expert Opinion Evidence of the post-injury earning capacity of the injured worker. This remedy supplemented the remedy of Modification via "proof of a job offer" ala "Kachinski".

[Kachinski is the name of the Pennsylvania Supreme Court decision which espoused a 4-part standard for the Employer burden of proof in a modification/suspension based upon evidence of a job offer. See: Kachinski v. WCAB (Vepco Construction Co.) 532 A.2d 374 (Pa. 1987).].

Section 306 was amended to require the Employer provide Employee prompt written notice, when medical evidence is received of Employee's ability to return to work in any capacity.
306(b) (3), 77 P.S. 512(3).

The LIBC-757, Notice of Ability to Return to Work, was created to fulfill this notice requirement.

Is a NARTW form required in every instance of Employer job offer to Employee?

School District of Philadelphia v. WCAB (Hilton), No. 598 C.D. 2013, a published decision of a panel of the Commonwealth Court authored by Judge Leadbetter on January 7, 2014, addressed this issue.

Factual and Procedural Background
Employee was a 2nd grade teacher at Pastorius Elementary School from November 2008 to March 2009.
On March 3 she suffered heart palpitations, headaches, dizziness and nausea, alleged as a result of a "particularly difficult day with her challenging classroom". [ 2nd graders, 8-9 years old?].

After her regularly scheduled Physician appointment, the Employer was notified by the physician office, Employee would not be returning to work, due to the school's overly stressful environment.

Employer panel physician examined and released Employee to return-to-work at her regular job at Pastorius. Employee worked 4 days in May, 2009.
Employer issued a Notice of Workers' compensation Denial LIBC-496 on May 29, 2009.

June 2009, Employer re-assigned Employee to teach at Jay Cooke Elementary School.
Employee met with the principal, toured the school. She later testified Cooke was the opposite of Pastorius, it was quiet, with "excellent teaching going on".

September 2009, Employee did not return-to-work at Cooke, as she was still undergoing treatment for her work-related stress.

October 2009 Claim Petition was filed, averring stress from abnormal working conditions.
[compare to the PA State Trooper in Payes for a gut-check on "abnormal"!].
She alleged a vocal cord injury and an aggravation of her pre-existing conditions, lupus and a heart murmur.

WCJ Claim Petition Decision 
... it's Pennsylvania ... so she received an award of benefits ... but the WCJ limited wage loss benefit to a period ending September 30, 2009 when the Cooke job was available.

The WCJ found credible the Employee medical expert testimony that Employee was not able to teach at Pastorius, however, she could return-to-work as a teacher, but not in that environment.

Both Employee and Employer appealed!

WCAB Decision
Affirmed grant Claim Petition.
Reversed on limitation of Award.

Commonwealth Court Appeal of Employer
Employer argued:
1. Employee medical expert was not legally competent to testify;
2. Employee only established disability through the date the Cooke position was available;
3. Employer was not required to provide Employee with a NARTW form.

Commonwealth Court Decision
1. Employee Medical Expert was legally competent to testify regarding causation.
2. Employee did meet her burden to establish a disabling injury.
3. Employer was not required to provide Employee with a NARTW form.

1. Competency of Medical Witness to testify
Employee has the burden of proof to establish all of the necessary elements for an award, including a casual relationship between work and the alleged disability, including the extent and duration of disability.

Employer argued Employee medical expert Dr. Baugh was not legally competent to testify (i)  regarding an exacerbation of lupus and (ii) regarding a causal relationship between psychological stressors and the alleged exacerbation.

Dr. Baugh was no longer board-certified in internal medicine.
She was not an expert in psychology, rheumatology, cardiology or otolaryngology.
However, in general, a physician is competent to testify as to specialized areas of medicine, even though he or she is not a specialist or board-certified in that area.

Objections and challenges of the Medical Expert, go to the weight or credibility of the testimony.
The WCJ is free to accept opinion testimony. Great credence may be given to a treating physician, as compared to an examining physician. citing: D.P. "Herk" Zimmerman Jr. Inc. v WCAB (Himes) 519 A.2d 1077 (Pa. Cmwlth. 1987).

Here the WCJ did not err. Dr. Baugh was a long standing treating physician. She was familiar with Employee's baseline lupus condition. Her opinion that Employee had an aggravation from work-related stress [and the corresponding finding of fact] was based upon substantial evidence. slip opinion page 6.

2. Employee met her burden of proof to establish a work injury.
Just as the medical opinions of Dr. Baugh were legally competent, these opinions also provide substantial credible evidence in support of the claim petition. Employee has the burden of proof of each element of the claim. Dr. Baugh provided evidence of the "aggravation" and she provided  evidence of the causal relationship to the work environment.

3. Employer was not required to provide a NARTW.
The Commonwealth Court reversed the decision of the WCAB .
The Appeal Board denied a suspension to the Employer, on the basis that Employee must receive a NARTW form, from the Employer, before any job offer.

The Court reasoned that:
1. Employee Medical Expert evidence (found credible by the WCJ) did not disable Employee from returning to any work as a teacher ... she was disabled from returning to position like Pasotrious.
2. Employee testified Cooke was unlike Pastorious.
3. Employer established a position was available to Employee at Cooke on September 30, 2009.

4. A NARTW form is required when Employer attempts to change a workers benefit status on the basis of medical evidence. It is a part of the earning power assessment process.

 Section 306(b)(3) outlines the Employer's duty to provide employee a "notice" -

                    "(3) If the insurer receives medical evidence that the claimant is able to return to work in any
                          capacity, then the insurer must provide prompt written notice, on a form prescribed by
                          the department, to the claimant, which states all the following..."

"The clear purpose of Section 306(b)(3) is to require the employer to share new medical information about a claimant's physical capacity to work and its possible impact on existing benefits".
Struthers Wells citing: Burrell v. WCAB (Philadelphia Gas Works). (Pa. Cmwlth. 2004).

Section 306(B)(3) presumes:
 (i) that an injury has caused disability;
(ii) a claim has been acknowledged as compensable and
(iii) employer seeks to reduce its existing liability of benefits payable.

NONE of these prerequisites for issuance of a notice are present here!

In this case, Employer filed a Notice of Denial.
Employee had not filed a claim petition, at the point in time when she argues a notice was required.

We conclude Employer was not required to issue a NARTW to Employee, in the claim petition setting.
 slip opinion pages 9-10.

Practice Pointers:
1. This ruling make good sense as the "job offer" in a pre-litigation setting may arise from within the employers office, after receipt of updated information from their employee. The attorneys and insurer are often not involved at this stage. It is more likely an "employment matter".  

2. In the context of an existing workers compensation matter, a NARTW is typically required. 
Burrell is the exception, that is, where an employee is discovered to be already actually working!

3. At times, there may be some confusion as to "which" member of the team will be responsible to issue the NARTW form.

Communicate! 
Often we suggest legal counsel prepare and serve this form upon claimant and claimant counsel. This contact may prompt a discussion regarding case resolution.