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Judges hearing Longshore and Harbor Workers' Compensation claims have long applied a "true doubt" rule - which shifts the burden of persuasion to the party opposing a benefits claim. Although the "true doubt" rule was thrown out in 1994 with the Supreme Court's decision in Greenwich Collieries (discussed below), there is a pervasive attitude in workers' compensation that fact disputes should always be resolved in favor of the claimant.

While the Greenwich Collieries decision is nearly 20 years old, the bias is so ingrained that recently proposed changes to the Longshore and Harbor Workers' Compensation Act, amend Section 901(a) to state “in a claim brought under this Act, the facts are not to be given a broad liberal construction in favor of the employee or of the employer, and the laws pertaining to a claim brought under this Act are to be construed in accordance with the basic principles of statutory construction and not liberally in favor of either the employee or employer.” (See my earlier post on the proposed changes).

In case decided September 6, 2011, the Court of Appeals (4th Circuit) ruled that where both sides presented diametrically opposed but equal evidence, the claimant must lose.

The Green Decision

Robert Green claimed that exposure to loud noises during 23 years of employment as a Longshoreman caused him to develop compensable sensorineural hearing loss. According to Green, he was often removing and installing twist-lock cargo container "shoes" (which fasten one container to another on a cargo ship). Green alleges that the noise of the freed containers contacting the waiting truck chassis, along with normal dock noises - machinery, diesel forklists, etc., - led to his hearing loss.

Green provided the court with the testimony of his audiologist (Joseph Gillespie) who testified that the claimant suffered from hearing losses at specific frequencies and which impacted the claimant's ability to distingish some spoken workds, including "the S's and F's and K's and TH's." He diagnosed "slight to mild sensorineural hearing loss, left greater than right" and calculated a 3.75% binaural hearing loss. Gillespie recommended that Green obtain in-the-ear hearing aids. Green filed a claim for disability benefits under the Longshore and Harbor Workers' Compensation Act.

In response, the employer had Green examined by a second licensed audiologist, who performed comprehensive audiological testing on the claimant. This new testing showed no hearing impairment (0% binaural). The claim for benefits was denied.

A trial ensued. Both audiologists testified that in order for two audiograms to be within "good reliability" there should be no more 5db difference between the two tests. The tests in question showed more than 5db variability at tested frequencies. The claimant's audiologist, Gillespie, testified that the differences between the two tests could be due to

1. the claimant's inattentivieness during the test; or
2. The presence of a cold or other medical condition which could have affected middle ear pressures.

The claimant's audiologist recommended that the claimant get a new (third) hearing test performed - but he claimant declined to do so.

The Administrative Law Judge found that the audiograms were both credible and "entitled to equal probative value" and so averaged the results to find an overall disability of 1.85% binaural hearing loss. The Benefits Review Board affirmed this decision.

The Appeal.

The employer appealed - arguing that the claimant did not meet his burden of proof under the law. The claimant essentially argued that in the case of a "tie" - two equally credible audiologists with differing views of disability allows the Judge to make a "split the difference" call. The employer argued that the evidence was not simply reliable - that the tests demonstrated too much variability and therefore neither could be relied upon. Further, both audiologists admitted that the variability between the two tests was beyond the threshold for determining reliability - on short, neither test could be considered "reliable" and therefore a Judge averaging two unreliable results could not yield a third, more reliable estimation of disability.

In a new decision issued September 6, 2011, the Appellate Court overturned the decision, citing the Spreme Court's decision in Director, Office of Workers' Compensation Programs, DOL v. Greenwich Collieries (93-744), 512 U.S. 267 (1994), which stands for the proposiiton that when the evidence is evenly balanced, the claimant must lose.

Case: Ceres Marine Terminals, Inc. v. Green, — F.3d —-, 2011 WL 3891891 (4th Cir. 2011).

Background

Under the New York Workers’ Compensation Law, there are four types of benefits available to an injured worker:

1. Medical treatment. Emergency and follow-up treatment for their injuries.
2. Wage compensation for earnings lost while they recover from the immediate effects of their injury.
   • This wage compensation is called "temporary total" with the claimant is 100% totally temporarily disabled (cannot work at all) OR
   • "Partial temporary" when the claimant can do some work – but isn't earning their prior level of wages (usually because they can only work part time or have to work at a job that pays less than the work they were doing at the time of the accident). This is calculated as 2/3rds of the difference between old wages and post-accident wages.
3. Death benefits payable to the dependents (usually wife and kids) of a worker killed during the course of employment. This is 2/3rds of their average weekly wage at the time of injury, subject to maximums and minimums, to the wife for life.
4. "Permanency" benefits – these are payments of money to injured worker to compensate them for the "permanent effects" of an accident.

With rare exception, our settlements will focus on resolutions regarding the amount of "permanent disability" that a claimant is due.
 
The amount of permanent disability – the money award at a claimant gets when he has reached maximum medical improvement – is set by statute.
 
The statute envisions two types of permanent disability compensation:

1. "Scheduled loss of use" which relates to injuries to body parts which are listed on this "scheduled loss of use chart" which is attached to this document. This is a fixed amount of compensation for injuries to fingers, toes, hands, feet, arms, ankles, knees, etc.  In other words, the Workers Compensation Law states that if you lose your thumb in accident, you get a fixed benefit – a number of weeks of compensation times your weekly rate – which is determined by the injury.
2. The second type of permanent disability award is called a "classified award” or sometimes it is called a "classification." This term "classification" doesn't really mean anything – it just means you sustained injury to a body part which is not specifically described on the "scheduled loss of use chart." For example, injuries to the head, neck, and low back are considered "classifiable" injuries – and they are compensated in terms of a fixed number of weeks – up to 600 weeks.

Example.

If I made $200 per week and I lose my thumb, according to the scheduled loss of use chart, I would be entitled to 100% loss of the thumb – 75 weeks of compensation. This would be paid at a rate equivalent to 2/3rds (66.6%) of my average weekly wage – or approximately $133.34 per week (two thirds of $200 per week). So in this example, the loss of my thumb would give rise to an award of $10,000 for permanent disability. The other benefit I would get would be medical treatment for life in regards to the lost thumb.
 
Imagine if I sustained an injury to my low back.
 
Assume that the treating and examining physicians all agreed that I was left with a 25% permanent residual impairment. My award would be 2/3rds of my average weekly wage times 25% of 600 weeks (the maximum number of weeks for classifiable injury). So, the award would be $133.34 times 150 weeks of compensation or $20,000.
 
Any amounts already paid to me – the claimant – during the claim for my lost waged – for example, if I lost a few weeks from work – would be subtracted from the overall award.

 Often, there is not a simple agreement between the parties as to the extent and nature of the claimant's residual permanent disability. In such a case, we will often have a trial. During the pendency of the trial both parties have the opportunity to present their own witnesses – usually medical witnesses who claim that the injured worker is either completely and totally disabled (the claimant’s doctors) or is absolutely fine and ready for the Olympics (our IME doctors).
 
If the parties can reach a settlement before the judge reaches his conclusion regarding permanent disability – we can stipulate to an overall resolution. That settlement can be handled a number of different ways. What follows is a description of the three ways in which settlements are typically resolved.
 

Settlements

The main difference between these ways of settlement is whether or not the settlement is "full and final" – that means the claimant can never come back into court and alleged that his condition has worsened and now needs more compensation – and whether or not the employer/carrier remains liable to provide future medical benefits to the claimant should the condition worsen or should the claimant require additional medical treatment.
 
As medical treatment costs are now driving workers compensation claims (the employers and carriers are seeking to minimize medical treatment costs) a settlement in which the medical treatment aspects are closed (a "full and final settlement with closed medical") is the preferred way for a carrier/player to resolve workers compensation case.
 

1. Lump-sum dismissals – everything gets closed.

    This is often referred to as a "section 32" settlement after the section of the statute which allows for this type of settlement. This is the preferred way for employer/carrier to close a case. In this type of settlement, the claimant is paid one lump sum – usually agreed upon between the parties and usually a whole number – for example, $50,000 – to resolve all issues. The claimant loses the right to reopen this claim should his condition worsened. The claimant loses the right to seek additional medical treatment which must be paid for by the employer/carrier. The claimant is responsible for paying his own attorney's fee – usually 15% of any settlement – directly to his attorney.
   
   A section 32 settlement must be approved by a judge of compensation. There are number of forms which must be completed and submitted to the court for settlement of this type to take place. Addiitonally, consideration of Medicare's potential future interest must be made - in many cases, a set-aside allocation should be considered.
    
   These forms are:
    
   1. C–32 settlement form.
   2. C–32.1 settlement form
   3. A–9 form.
   4. An addendum document, explaining that the claimant's right further compensation is waived, that medicals are closed, and laying out any other particular aspects of the proposed settlement.
   5. A further correspondence must be sent to the office of Child support enforcement seeking a statement that the claimant does not know any child support payments in the state of New York. This should be simply sent to the Office of Child Support Enforcement – and does not have to be submitted to the workers compensation board except as a copy.

2. Lump-sum dismissals – medical stays open.

   This is still a "section 32" settlement with the only aspect of the case that is closed is the amount and nature of the claimant's permanent residual disability. In other words, we our paying the claimant a lump sum for the amount of permanent impairment to the body part injuries the accident.  The claimant is also giving up the right to reopen the case – he can never come into court and say's condition has worsened and he needs more compensation for increased impairment. However, the carrier remains "responsible" for additional medical treatment should the claimant's condition worsen and require additional care. In this type of settlement, Medicare's potential future insterest does not have to be considered - medical stays open and so the claimant can come back to the medical carrier for any necessary treatment.
    
   The specific forms which must be filed in this case are the same as the lump-sum dismissal of all claims (above at one).
    
   1. C–32 settlement form.
   2. C–32.1 settlement form
   3. An addendum document, explaining that the claimant's right further compensation is waived, that medicals are closed, and laying out any other particular aspects of the proposed settlement.
   4. A further correspondence must be sent to the office of Child support enforcement seeking a statement that the claimant does not know any child support payments in the state of New York. This should be simply sent to the office of Child support enforcement – and does not have to be submitted to the workers compensation board except as a copy.
    

3. Stipulated settlement

   – classification or scheduled loss of use with medical staying open. In this case, we are stipulating to the fact that the claimant has a residual permanent impairment to a "scheduled" body part or to a body part which is "classified." In this case, we complete form 300.5 S completely as possible – describing the injuries, the percentage of permanent pyramid, and all necessary particular facts to establish the award – which will include the average weekly wage of the claimant. In this type of stipulated settlement, we will be granted credit for payments of temporary total or temporary partial wage continuation benefits which were issued during the pendency of the case – while the claimant recovered.
    
   • Forms:  C-300.5

Have any questions about settling claims in New York? Contact Greg Lois.

New Jersey does not have a "fee schedule" for medical services provided to petitioners in workers' compensation cases, but because the employer controls care, the respondent is able to direct the claimant to medical care providers with whom contractual arrangements have established - usually to refer the provider's bills for third-party review and repricing. This helps the carrier/employer reduce costs.

In the past few years a huge number of "Medical Provider claims" have been filed in the Division of Workers' Compensation seeking additional payments for medical services provided to workers' compensation patients. Typically, the claim is for the difference between the billed amount of services and the amount paid (usually less than 50% of the original billing).

Initially there was confusion within the Division regarding how these cases were to be docketed and litigated. The Division now accomodates the filing of these claims through the use of a new claim form ("Medical Provider Application for Payment or Reimbursement of Medical Payment"). The Division also formed a Task Force on Medical Provider Claims" to address the new actions. The Task Force issued a memorandum in November 2010 which provided a 13-point "checklist" of factors that a workers' compensation judge should consider when deciding a Medical Provider Claim ("MPC") - but this list had the force of a "suggestion" rather than a rule or regulation (go to page 8-9 of the memo for the proposed list).

Practitioners representing carriers and self-insureds have suffered from limited guidance on how these claims were to be litigated - simply stated, there have been no reported decisions addressing the proofs and standards for these new claims. In litgating these matters, a form of brinksmanship has developed - in which the defense sought trial and asked to cross-examine the doctor seeking the fee - in order to force the doctor to come to court and presumably lose time that could be spent more profitably treating patients. In practice, these claims are usually compromised - with the parties agreeing to negotiate values and then entering a Section 20 agreement to close the case (pursuant to N.J.S.A. 34:15-20).

In a 77-page decision issued August 31, 2011, Administrative Supervisory Judge Virginia Dietrich (Middlesex County) ruled on a MPC case in which the claimant underwent extensive skin grafting surgery performed by two surgeons. The carrier (NJM) disputed the billing - specifically, that the surgeons submitted two bills for the same surgery - not as "co-surgoens" but rather seperately - as if one surgeon was not assisting the other.

Judge Dietrich ultimately ruled against the surgeons - findings that the carrier had applied the appropriate reductions after their review and audit of the billing.

While this decision is an agency decision, and therefore un-reported, this is the frst decision on this subject - and Judge Dietrich chaired the Division's Task Force on Medical Provider Claims - so we can expect the reasoning in this decision to influence the way these MPC claims are handled throughout New Jersey.

What's good in the decision for employers:

• Judge Dietrich had to decide what the "usual, customary, and reasonable" fees for the surgeries performed was. Judge Dietrich decided to rely on paid fees as appropriate as opposed to billed fees for services rendered.
• In finding what was the "usual, customary, and reasonable allowance" Judge Dietrich also found it was appropriate to look at all payments made to the medical providers rather those exclusively made by commercial carriers.
• Judge Dietrich also found that contractual carriers or government programs should be considered in determining what is customarily accepted by the provider.
• The Judge also suggested that the more payments that are considered, the better - stating "It is only by reviewing every payment that a determination can be made as to what an acceptable payment is.
• Judge Dietrich was reviewing bills relating to very specialized care - she found that

  "[t]he instant case is somewhat unusual because it deals with burn surgeryIn New Jersey there are very few practitioners. There are none in northern New Jersey to compare with. The fact is, however, that the Burn Surgeons do accept all manners of insurance coverage including self-pay, government programs, contractual payers and commercial carriers. It is possible then to compare what the petitioner deems acceptable from other payers.

  This is important for defense practititioners to keep in mind in cases where the petitioenr has been rendered specialized or emergent treatment.

What's bad:

• Judge Dietrich found that

  "In trying these cases it is helpful to have witnesses familiar with coding and billing processes. Dr. Marano was a necessary witness in this case as there was a question as to the work done in the surgery. In those cases in which the dispute is over payment only and not whether the procedures were completed or the manner in which the procedures were completed I find that it is unnecessary to have the doctor testify. The petitioner must produce a party responsible for the data and an expert who can interpret it if necessary."

  This is bad for employers because it means that the doctor who is seeking additional payments does not have to tactually come to court (and thereby lose time she could be spending treating and billing) but can send "a party responsible for the data and an expert to interpret it if necessary" to prosecute her claims.
  
  Case: Burn Surgeons of St. Barnabas v. Shop Rite, decided August 31, 2011. (Note: this is an agency decision and has no precedential value. Burn Surgeons of St. Barnabas has an abolute right of appeal in this case. I will continue to follow this case closely and report on any appellate developments.)