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DamAges

One of the duties of fortitude is to keep the weak from receiving injury; another, to check the wrong motions of our own souls; a third, both to disregard humiliations, and to do what is right with an even mind. – St. Ambrose

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P U R P O S E : This publication is intended to help our clients and colleagues understand how to

proactively manage Workers’ Compensation issues and claims. It also reveals the strategic benefits that businesses realize with the highest standard of representation provided by Allen & Gooch. With courage and foresight, Allen & Gooch believes this workbook can be an introduction to effectively understanding the principles of Workers’ Compensation – as the rules, case law and legislation continue to evolve.

T A R G E T A U D I E N C E : This publication is intended for business leadership and managers, human resource professionals, others who need a broad understanding of Workers’ Compensation law, and those involved in Workers’ Compensation issues and claims.

D I S C L A I M E R : This publication is intended to provide guidance on Workers’ Compensation law and its application in the workplace. It does not and is not designed to address all Workers’ Compensation issues which a business or its legal and other advisors may face. It is the user’s responsibility to assure that Workers’ Compensation law is understood and rules and regulations that govern its application are followed. Users should consult with legal counsel for additional and more detailed explanations. P U B L I C A T I O N D A T E : March 2017

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Table of Contents COVER LETTER

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1.

1

WHAT IS AN ACCIDENT?

2. WHAT IS COURSE AND SCOPE OF EMPLOYMENT?

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3. HOW TO CALCULATE AVERAGE WEEKLY WAGE

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4. HOW TO PAY CORRECTLY AND ON TIME

19

5. HOW DOES THE NEW PRELIMINARY DETERMINATION PROCESS WORK?

29

6. WHAT ARE VOCATIONAL REHABILITATION OBLIGATIONS? 35 7. WHAT ARE THE LOUISIANA MEDICAL TREATMENT GUIDELINES (MTG) AND PAYING BENEFITS? 8. AFFIRMATIVE DEFENSES AND THE SECOND INJURY FUND 9. WHAT ARE PENALTIES AND ATTORNEYS’ FEES? 10. HOW DO I SETTLE WORKERS’ COMPENSATION CLAIMS?

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Dear Colleagues, Workers’ Compensation is a form of insurance providing wage replacement and medical benefits to employees injured in the course of employment in exchange for mandatory relinquishment of the employee’s right to sue his or her employer for the tort of negligence. The tradeoff is limited coverage and lack of recourse outside the Workers’ Compensation system and is known as “the compensation bargain.” The compensation bargain protects employers against insolvency as a result of high-damage awards while ensuring the security of compensation to workers. Plans differ among jurisdictions. Provisions are typically made for: • • • •

Payments in place of wages (functioning as a form of disability insurance); Compensation for economic loss (past and future); Reimbursement or payment of medical and like expenses (functioning as a form of health insurance); and Benefits payable to the dependents of workers killed during employment (functioning as a form of life insurance).

The challenge Not every Workers’ Compensation situation can be foreseen. For businesses large and small, the complexities and risks of Workers’ Compensation are an ever-present challenge. Further, Workers’ Compensation statutes, legal precedent and regulations are constantly evolving, leaving clients and their businesses vulnerable and at legal risk.

The Allen & Gooch difference Understanding the Workers’ Compensation system, and prompt, aggressive, knowledgeable and vigorous representation are the best defense against Workers’ Compensation claims. Intimate knowledge of the law and detailed knowledge of workplace practices of major Louisiana industries help the skilled attorneys at Allen & Gooch produce the most satisfactory results for our clients’ industries and businesses. Our Workers’ Compensation practice includes: • • • • • •

Fraud & Misrepresentation Claims Course & Scope of Employment Issues Disputes Over Medical & Disability Indemnity Benefits Second Injury Fund Disputes on Medical Causation Defense to Penalty & Attorney Fee Claims

• • • •

Affirmative Defenses (including intoxication) Jurisdictional Disputes Mediation & Settlement Negotiations Disputes on Occurrence of Accident & Compensability Issues

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Our attorneys are thoroughly familiar with the types of injuries commonly suffered in each industry, including applicable diagnoses and treatments. We routinely and effectively collaborate with specialists and other experts to help ensure our cases are strong, defendable and winnable.

This publication Our team of Workers’ Compensation experts assembled this publication as a job aid to help our clients better understand the ever-changing world of Workers’ Compensation. Fundamental principles of Workers’ Compensation presented in this publication provide guidance and a framework for an effective and appropriate response to Workers’ Compensation issues. We hope you find it helpful in navigating the challenges of Workers’ Compensation claims and in mitigating their risks.

Our promise At Allen & Gooch, we recognize Workers’ Compensation defense is a significant responsibility with far-reaching impacts. We work closely and proactively with our clients to help manage risks, responding immediately and aggressively when claims are made. Call on us when you have Workers’ Compensation issues. We can help. Sincerely,

Clay M. Allen Managing Partner Allen & Gooch

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1.

1. What is an accident?

What is an accident?

1.1 WHAT THE LAW STATES –ACCIDENT 1.2 COMPENSABLE ACCIDENTS THAT HAVE UNUSUAL OR SPECIAL CIRCUMSTANCES 1.3 NON-COMPENSABLE ACCIDENTS 1.4 OTHER COMPENSABILITY ISSUES TO CONSIDER

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1. What is an accident? Just because an employee has an injury does not necessarily mean an employer has a legal obligation to compensate the employee under Workers’ Compensation law.

1.1 What the law states – Accident LSA-R.S. 23:1021 (1) – Definition of Accident A compensable Louisiana Workers’ Compensation accident is: 1. An unexpected or unforeseen, actual, identifiable, precipitous event; 2. Happening suddenly or violently; 3. With or without human fault; 4. Producing objective signs of injury which are more than simply a gradual deterioration or progressive degeneration.

Each element must be satisfied!

1.2 Compensable accidents that have unusual or special circumstances While many work-related accidents are easily recognized as compensable, others are more unusual or have special circumstances that are important to consider. For example, how do you decide if an accident is compensable if there are no witnesses? How do you determine if a heart attack is just a heart attack or a work-related and compensable event? Are accidents that include

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mental injury claims compensable? What impact, if any, do pre-existing conditions have on the compensable decision? Those answers – and more – are covered below. 1.2.1

Examples of unusual compensable accidents: • •

1.2.2

Pain while riding a bike. Bending over to adjust a knob.

Unwitnessed accidents are often compensable IF: • •

No evidence discredits or casts serious doubt upon the worker’s version of the accident; and The worker’s testimony is corroborated by circumstances following the accident. ƒƒ

1.2.3

The most important corroboration is often what the plaintiff told the first doctor he/she saw after the accident.

Physical work stress or exertion, and not some other source of stress or pre-existing disease, was the predominate and major cause of the heart attack; and The physical work stress was extraordinary in comparison to the stress of the average employee in the same occupation.

BENDING OVER TO ADJUST A KNOB

Accidents that include mental injury claims can be compensable IF both of the following conditions are met: • •

1.2.5

PAIN WHILE RIDING A BIKE

Perivascular claims/heart attacks can be compensable IF both of the following conditions are met: •

1.2.4

EXAMPLES OF UNUSUAL COMPENSABLE ACCIDENTS

Proven by clear and convincing evidence; and Diagnosed by a licensed psychiatrist or psychologist and diagnosis meets criteria established in the Diagnostic and Statistical Manual (DSM).

Aggravation of a pre-existing condition can be compensable under the following conditions: • •

The work accident combines with or exacerbates a pre-existing condition; and Presumption that the work accident caused the disability if before the accident the employee was able to work with no problem, under certain circumstances.

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1.3 Non-compensable accidents 1.3.1

Examples of non-compensable accidents: • •

Development of hepatitis without proof of a specific exposure. Degenerative disc disease with no testimony as to a specific event that caused the problem.

1.4 Other compensability issues to consider 1.4.1 Other issues to consider when determining the compensability of an accident include: • • • • • •

Was there horseplay involved? Did the injury result from social activities? Were there assaults by third parties? Was the claimant standing by to work or on-call? Did the accident occur during lunch break or before or after working hours? Is there a degenerative condition impacting the event?

RELATED CASE LAW

HORSEPLAY

CASE Bruno v. Harbert Int'l Inc., 593 So. 2d 357, 362–64 (La. 1992)

DESCRIPTION This case held that an employee can prove an unwitnessed accident if it is corroborated by other evidence, but only if there is no evidence that casts significant doubt on the occurrence. In Bruno, the Louisiana Supreme Court identified several indicators that are useful to determining corroboration and/or significant doubt, including:

Arrant v. Graphic Packaging Int’l, Inc., 127 So.3d 924 (La. 5/5/15)

The history provided by the treating physician;

Whether plaintiff immediately notified the employer of the accident;

Timely submission of an accident report; and

Whether plaintiff had a prior history of similar complaints and problems.

The Louisiana Supreme Court decided that gradual hearing loss caused by occupational exposure to hazardous noise is an “ accident ” or “ occupational disease. ” This case appears to have overruled the controlling case which previously held that gradual hearing loss from occupational noise over a period of many years does not meet the definition of an accident.

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CASE McCoy v. W.A. Kendall & Co., Inc., 181 So.3d 817 (La. App. 2 Cir. 11/25/15)

DESCRIPTION The Second Circuit rejected the employer’s arguments that restrictions and disabilities were the result of a pre-existing condition, reiterating that the pre-existing condition is presumed to have been aggravated by the accident if the disabling symptoms did not exist prior to the accident and either medical or circumstantial evidence indicates a reasonable possibility of a causal connection between accident and activation of disabling condition. Here, before the work-related accident, the claimant was able to complete his work without restrictions, but subsequent to the accident the claimant was unable to perform similar work duties.

Mills v. Boasso Am. Corp., 179 So.3d 815 (La. App. 4 Cir. 11/18/15)

Employer filed a Motion for Summary Judgment (MSJ) arguing that the Social Security disability benefits were awarded based upon the determination that the claimant was disabled prior to the alleged work accident.

Harvey v. Sol’s Pipe & Steel, Inc., 180 So.2d 486 (La. App. 2 Cir. 10/28/15)

Claimant allegedly injured his shoulder in August 2011 and reported the same to both of his supervisors. However both supervisors testified that claimant advised then that he hurt his shoulder while working on the transmission of his own vehicle. Medical records revealed a lengthy history of shoulder complaints, but no documented work-related injuries. When determining whether claimant can prove an unwitnessed accident, commentators have developed six (6) factors the Courts tend to consider:

The Workers’ Compensation Judge (WCJ) granted the employer’s Motion, but the Fourth Circuit reversed and remanded the matter reasoning that the Social Security disability determination was based upon Social Security rules and not Workers’ Compensation rules.

(1) Delay in reporting accident; (2) Supervisor and co-worker testimony; (3) Family and friends testimony; (4) Medical evidence including whether an accident history was given to early medical providers; (5) Continuing to work; and (6) Prior injuries.

Ultimately, both the WCJ and Second Circuit agreed that based upon the totality of the circumstances the claimant failed to establish a work-related accident. Marshall v. Courvelle Toyota, 175 So.3d 1069 (La. App. 3 Cir. 10/7/15)

Claimant allegedly injured his back when he manually lifted a transmission into the back of a delivery van – even though he was instructed to use a truck with a lift gate. Claimant supervisors and co-workers did not observe claimant exhibiting any pain or discomfort and he failed to report the incident until nearly a week later. At trial, the WCJ found that the claimant failed to establish he suffered a work-related accident based upon the delay in reporting the incident and the credibility of claimant’s version of events. The Third Circuit reversed the lower Court explaining that a claimant’s delay in reporting an injury may be excused when the claimant is initially unaware of the severity of employee’s injury.

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CASE Bridges v. Gaten’s Adventures Unlimited, L.L.C., 167 So.3d 992 (La. App. 1 Cir. 4/2/15)

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DESCRIPTION Claimant was a bus driver who injured her back while lifting a handicapped child onto the bus. However, claimant did not report her injury until four (4) days after the accident, because the office was closed by the time she returned from the trip and when she went to report the accident on the following day, her supervisor was not at work. Over the weekend the claimant went to the ER and explained how the injury occurred to the ER personnel. However, the medical records from the ER were inconsistent with claimant’s testimony. The WCJ found in favor of the claimant and First Circuit affirmed.

Tubre v. Auto. Club of S. California, 170 So.3d 160 (La. App. 4 Cir. 2/4/15)

Claimant alleges he aggravated a pre-existing back injury when he tripped on a pallet trying to place a battery on a shelf on Christmas Day in 2012, while the claimant was the only employee in the store. Claimant claims he unsuccessfully attempted to contact his supervisor. In fact, the injury was not reported until the following day after claimant had been instructed to come into work to meet with the employer’s director of human resources and special investigator. When claimant refused to come to work, the director of human resources questioned the claimant about the claimant’s violation of the employer’s ethical code. Based upon the claimant’s responses, he was terminated. At trial, claimant presented three (3) witnesses who testified that claimant complained of back pain on Christmas Day. The WCJ’s review of claimant’s medical records revealed that claimant had been treating his back pain for quite some time and the records did not indicate any significant change in his condition from before the alleged accident until after. These findings assisted in the WCJ’s determination that no work-related accident occurred, which was affirmed by the Fourth Circuit on appeal.

Doucet v. National Oilwell Varco Fluid Control, 120 So.3d 727 (La. App. 3 Cir. 5/22/13)

Claimant worked at a remote location for the employer and was provided with hotel housing and contracted a staph infection. Medical testimony provided that the likely source of the infection was the hotel.

Calumet GP, LLC v. Garrett, 186 SO.3d 712 (La. App. 2 Cir. 1/20/16)

In Calumet v. Harold Garrett, January 20, 2016 Second Circuit, the Court of Appeal affirmed a finding of no accident. Claimant was found not to have any credibility based upon the surveillance video that showed him doing various activities including yardwork whereas he told the adjuster that he was unable to perform any such activities. Notably, the surveillance video also showed the claimant using a walker to visit his doctor’s office and promptly discarding the walker upon leaving his doctor’s office.

The WCJ found that the totality of the circumstances constituted sufficient proof of a work accident as a result of the staph infection.

Claimant’s testimony was held unable to carry his burden of proving a compensable accident when he had a very similar previous condition. Further, the early medical records did not corroborate the claimant’s story and were more consistent with a previous, ongoing medical problem, and claimant accident reported to his co-worker on the way to get medical treatment on the day of the alleged accident that his symptoms had been longstanding.

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CASE Earl Thibodeaux v. Carroll’s Towing and Everybody Rides, (La. App. 3 Cir. 7/3/14)

DESCRIPTION The claimant’s failure to prove the alleged unwitnessed accident was affirmed on appeal relying upon the Bruno criteria – that claimant was proven to have known about the employer’s immediate accident reporting policy and to have delayed in making an accident report, with an insufficient explanation. Very importantly to the outcome of the case, the medical records failed to corroborate the alleged accident, even though the claimant swore that he told the medical providers that he was hurt at work. Also, two (2) co-employees refuted claimant’s version of events following the alleged accident. The court reasoned that the evidence failed to corroborate the alleged accident and instead casted serious doubt and dispute on the claimant’s version of events.

Wiltz v. Luba Worker’s Comp., 2015-145 (La. App. 3 Cir. 10/7/15), 175 So. 3d 1046, 1049

The claimant gave a recorded statement wherein he vaguely mentioned a previous motor vehicle accident but indicated that he received only short-term medical treatment for that injury and thereafter was fine. The trial court found that was a material misrepresentation in violation of LSA–R.S. 23:1208 because the claimant had multiple previous injuries and significant previous medical treatment and problems, including a lumbar herniated disc that he knew about and remembered as evidenced by the fact that the claimant discussed that herniated disc and the potential for treatment with a neurosurgeon and with his family doctor a mere two (2) months previous to the alleged accident. The trial court also awarded restitution in the amount of $54,570.83, but the Court of Appeal lowered the restitution award to $12,000, reasoning that restitution was not available after the date that the carrier received the Index Report that revealed evidence of fraud.

Garcia v. Rouses Enter., Inc., 170 So.3d 1157 (La. App. 5 Cir. 5/14/15),

Claimant was a stock clerk for employer-grocery store, when he was moving boxes of merchandise and allegedly injured his back. However, claimant did not complete an accident report until nine (9) days after the alleged accident. During that time, claimant consulted with an attorney who referred him to medical providers of which had not been authorized by the employer. Medical records revealed that the claimant failed to truthfully disclose prior medical history. The WCJ concluded that the circumstances surrounding his claim cast suspicion on the credibility of the claimant, such that he could not prove a work-related accident. This decision was affirmed.

Marsh v. North Louisiana Medical Center, 113 So.3d 1174 (La. App. 2 Cir. 4/10/13)

Claimant was a nurse who supposedly felt a strain in her neck while turning a patient on June 5, 2009. She finished her shift but was unable to get out of bed the next day. She obtained treatment at the ER the day after the accident and records indicated that claimant had “no known trauma.” She paid for the visit with personal insurance and complained to an orthopedic surgeon of shoulder pain a week later. She allegedly continued to work in pain until July 2010 when she reported a developmental injury that occurred “some time” in 2009. Evidence showed that when she was injured on a prior occasion with the same employer, she immediately reported the injury. The Office of Workers’ Compensation (OWC) reasoned that the lack of evidence of her current claim and her failure to follow the same procedure as she had with the previous injury supported a finding that she failed to prove the occurrence of a workplace accident.

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CASE

DESCRIPTION

Bourgeois v. Seabright Insurance Company, 115 So.3d 50 (La. App. 5 Cir. 4/10/13)

Claimant allegedly injured his knee on January 19, 2012 while climbing in and out of a man basket and on top of pipes. Claimant reported that he awoke with pain and swelling in his knee the next day and sought medical treatment on January 21, 2012. Employer filed a MSJ alleging that the employee was unable to meet his burden of identifying an “ actual, identifiable, precipitous event ” within the meaning of LSA-R.S. 23:1021(1). Employee testified he did not know exactly when he injured his knee and did not recall a traumatic or painful event. The employee argued that he established “ strenuous physical work activities. ” The Court distinguished Bruno v. Harbert International, Inc. which held that an accident exists when heavy lifting or strenuous efforts, although usual and customary, cause or contribute to a physical breakdown or accelerate its occurrence because of a pre-existing condition, by noting that the statute was amended after that case to prove an identifiable event. The Court held that the employee is required to “ identify the event marking the time when one can identify an injury ” and granted the MSJ.

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P A G E

I N T E N T I O N A L L Y

L E F T

B L A N K

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2. What is course and scope of employment?

2.

What is course and scope of employment?

2.1 WHAT THE LAW STATES – COURSE AND SCOPE OF EMPLOYMENT 2.2 ACCIDENTS OCCURRING WHILE TRAVELING TO AND FROM WORK 2.3 ACCIDENTS OCCURRING DURING DEVIATION FROM JOB-RELATED ERRANDS 2.4 ACCIDENTS OCCURRING DURING LUNCH BREAK

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2. What is course and scope of employment? Does an accident have to have occurred in the work place to be compensable? What about traveling to and from work? OR what if an accident occurs during deviation from a job-related errand? OR what about lunch breaks? The focus of this Section is on whether an employee is in the place he/she usually performs his/her work or duties, at a time the work or duties are usually performed.

2.1 What the law states – Course and scope of employment LSA-R.S. 23:1031(A) – “Arising out of Course and Scope” Requirements Injury resulting from a compensable accident must arise out of and occur in the “course and scope of employment.” Think of it as a funnel; both conditions must be met: • •

“ Arising out of” requirement focuses on character or source of risk/occurrence in question. “During the Course and Scope of Employment” requirement measures the relationship between the risk/occurrence and the employment in terms of time and space.

Both the “arising out of” and “during the course of” elements must be present for an injured worker to recover compensation. A strong showing in one will make up for a weak showing in the other.

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2.2 Accidents occurring while traveling to and from work

EXCEPTIONS TO THE “COMING AND GOING RULE”

The general rule (“coming and going rule”) is:

An accident that occurs while the employee is going to, and returning from work is not considered to have arisen out of and during the course and scope of employment. 2.2.1

Exceptions to the “coming and going rule:” • • • • • •

• •

The accident occurred on the employer’s premises. Employee is asked to perform job tasks/duties while en route or once he/she returns home. The transportation is furnished as an incident of employment. The employer reimburses the employee his travel expenses. Employee on special mission for employer (“from portal to portal”). When the employer’s premises are immediately adjacent to an unusually hazardous area of travel (threshold doctrine). The employee was injured while traveling to and from one work site to another. When operating a vehicle is one of the duties of the employee’s employment.

OCCURRED ON THE EMPLOYER’S PREMISES

EMPLOYER REIMBURSES TRAVEL EXPENSES

Whether or not an accident occurring during travel to or from work falls under an exception and is, therefore compensable, turns on the facts of each case. 2.2.2

Factors considered by Courts in making determinations include: • •

• •

Whether employee is engaged in the employer’s OPERATING A VEHICLE IS ONE business as opposed to personal pursuits. DUTY OF EMPLOYMENT Whether the necessities of the employer’s business reasonably require the employee’s presence at the location of the accident at the time the accident occurred. Whether employer had control over employee’s direction or route. Whether the employer had a reasonable expectation that the employee would perform the action in which he/she was engaged when the accident occurred.

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RELATED CASE LAW CASE Maxwell v. Care Solutions, Inc., 179 So.3d 650 (La. App. 2 Cir. 9/30/15)

DESCRIPTION Claimant was a caregiver. Although claimant’s shift normally ended at 5:00 PM, on this date the elderly gentleman claimant was providing care to was complaining of chest pains around 5:30 PM. Claimant was instructed to call 911 and go with the client to the hospital until the client was either released or admitted. Just before entering her car after the client was admitted, claimant was attacked by an unknown assailant, fracturing facial bones and breaking her nose. However, the employer denied the claim arguing the accident did not arise out of and in the course of her employment. The employer argued: (1) claimant volunteered to accompany the client to the hospital after her shift ended; (2) even if required to go to the hospital, her shift ended when the client was admitted to the hospital; and, (3) claimant’s injuries arose out of a non-work-related dispute.

The Second Circuit rejected all of employer’s arguments, finding that claimant was directed by her employer to accompany the client to the hospital. In addition, after finishing their shift an employee is entitled to a reasonable period while still on the employer’s premises or another place where their employment has brought them. Theriot v. Full Serv. Sys. Corp., 166 So.3d 1190 (La. App. 3 Cir. 5/27/15)

Shortly before the claimant’s shift began, claimant was searching for a parking spot in the employer’s parking lot when she was struck by a vehicle driven by another employee and injured her neck. The WCJ and the Third Circuit both agreed that the claimant was in the course and scope of her employment at the time of accident because the accident occurred on the employer’s premises. Therefore, this incident fell within one of the exceptions to the “coming and going rule.” Of note, Judge Gremillion dissented as he defined the “ employer’s premises ” as “ only that area where the employees are confined during their employment hours when they are engaged in the employer’s industry, labor, or trades. ”

Rattliff v. Reg’l Extended Home Care Pers. Servs., L.L.C., 134 So.3d 129 (La. App. 3 Cir. 3/5/14)

A home healthcare worker claimant was injured while en route from her home to a patient’s home. The Court rejected claimant’s contention that her home was a workplace, noting that while she had an employer-provided laptop at home, she did not use it. Likewise the fact that her employer required her to have a valid driver’s license and insurance was insufficient to prove that the employer had interested itself in her travel.

2.3 Accidents occurring during deviation from job-related errands When considering whether an accident that occurs during deviation from a job-related errand is compensable, the general rule is that accidents occurring when an employee engages in a personal errand while performing a job-related mission are not compensable unless the employer gains benefit from the deviation. The employee reverts back to “course and scope of employment” if he/she resumes job-related duties following the deviation.

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RELATED CASE LAW CASE Ruiz v. City of New Orleans, 109 So.3d 52 (La. App. 5 Cir. 1/16/13)

DESCRIPTION Claimant was a police sergeant with the New Orleans Police Department (NOPD), and he had been assigned to perform administrative duties at a location other than the police headquarters. Claimant wore plain clothes to work and drove a personal vehicle. On the date of the accident, the claimant drove to a credit union that was connected to the NOPD headquarters to withdraw money from his personal account. While leaving the credit union, claimant fell in a rear stairwell of the NOPD headquarters and was injured. The WCJ denied benefits finding the claimant was not within the course and scope of his employment at the time of the accident, stating specifically, “ . . . [claimant] was neither actively engaged in the performance of work-related duties, nor at a place where his current employment activities took him. ”

Black v. Johnson, 148 So.3d 574 (La. App. 2 Cir. 4/9/14) and Potier v. Acadian Ambulance Serv., Inc, 153 So.3d 1082 (La. App. 3 Cir. 2/12/14)

Where a per diem for travel is paid to the employee but the amount bears no relation to the actual travel expenses, the Courts have held that the per diems were meant as inducements and were not sufficient to justify an exception to the “coming and going” rule.

2.4 Accidents occurring during lunch break Accidents are not considered to have arisen out of or during the “course and scope of employment” if the employee leaves the employer’s premises for lunch; however, an employee who is injured at worksite during lunch break or “rest period” is covered under the Act.

RELATED CASE LAW CASE Sharp v. United Fire & Indemnity Co., 185 So.3d 830 (La. App. 1 Cir. 12/23/15)

DESCRIPTION While on their lunch break, claimant and his supervisor went to the bank to cash their paychecks. Claimant’s supervisor was driving the vehicle, which was owned and maintained by their employer, when they were involved in an accident with another vehicle. The claimant brought suit in District Court against his supervisor and employer. The First Circuit recognized that these facts fell within one of the exceptions to the “coming and going rule,” namely that when transportation is furnished as an incident of the employment any injuries sustained therein fall within the course and scope of employment. The appellate Court emphasized that claimant and his supervisor were in their employer’s vehicle, and had been authorized to use the vehicle during their lunch period to run personal errands. Therefore, the First Circuit affirmed the District Court’s grant of the employer’s Motions for Summary Judgment (MSJ) which had asserted that the claimant’s exclusive remedy was in Workers’ Compensation.

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3.1 WHAT THE LAW STATES – AVERAGE WEEKLY WAGE 3.2 HOURLY WAGES 3.3 MONTHLY WAGES 3.4 ANNUAL WAGES 3.5 OTHER WAGES 3.6 INCOME TAX (FRINGE BENEFITS)

3. How to calculate average weekly wage

3.

How to calculateaverage weekly wage

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3. How to calculate average weekly wage “Wages” means the employee’s Average Weekly Wage (AWW) at the time of an accident. Whether the employee is paid hourly, monthly or annually, in Workers’ Compensation law, the employee salary is calculated weekly.

3.1 What the law states – Average weekly wage LSA-R.S. 23:1021(13)- Definition of Average Weekly Wage (AWW) “Wages” means Average Weekly Wage (AWW) at the time of the accident. The average weekly wage shall be determined as follows . . .

3.2 Hourly wages There are several types of hourly wage earners. An hourly wage earner, for example, may be any of the following: • • • • •

A full-time employee working 40 hours a week; An employee offered 40 hours a week but choosing to work less; A part-time employee working for a single employer; A part-time employee with two (2) or more different employers; or A seasonal worker.

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There are various ways to calculate AWW for an employee paid hourly wages. 3.2.1 •

Full-time/40 hour a week employee: Is entitled to the greater of: (1) His/her average weekly gross wages over the four (4) full weeks prior to the accident; or (2) His/her hourly rate (at the time of the accident) multiplied by the average actual hours worked in the four (4) full weeks preceding the date of the accident.

If the employee works close to 40 hours per week, the Court will usually give him/her the benefit of the doubt and require that the AWW be based upon 40 hours. This is known as the “40-hour presumption.”

RELATED CASE LAW CASE

DESCRIPTION

Barbier v. Kraft Foods, 158 So.3d 239 (La. App. 3 Cir. 2/4/15)

Claimant argues that she was paid an hourly wage, while the employer contends claimant was a salaried employee. Although the claimant’s check stubs illustrate an hourly wage rate, the WCJ determined claimant was on salary, as the minimum amount she was paid in a given week was $700.33 - even in weeks she did not work a full 40 hours. The Third Circuit stated, “[t]he fact that her pay is expressed in hourly terms on her pay stubs does not negate her status as a salaried employee.”

Davis v. Boise Cascade Co., 149 So.3d 331 (La. App. 3 Cir. 10/1/14)

Dispute arose as to the proper calculation of the employee’s AWW. Employer used the four (4) weeks immediately preceding the work accident, but evidence revealed one of those weeks included a day wherein the claimant did not work a full shift due to a power outage. The WCJ found that because the employee did not work a full shift on that day, that week was not to be included in the calculation of AWW because it was not a “ full week .” Affirmed on Appeal.

3.2.2

• •

3.2.3

Employee offered 40 hours, but regularly and at his/her discretion choosing to work less, AWW is calculated using the average of total earnings in the four (4) full weeks preceding the date of the accident The employer must provide evidence that the claimant chose to work less than 40 hours. This will usually require some written evidence from the claimant. Unless the hours the claimant worked is considerably less than 40 hours per week, the Court will likely give the claimant the benefit of the 40-hour presumption. Part-time employee working for a single employer, AWW is calculated using the employee’s hourly rate multiplied by the average actual hours worked in the four (4) full weeks preceding the date of injury. The Court will require that the claimant: ƒƒ ƒƒ

“Knowingly” accepted a part-time position. You will have to produce some evidence that the claimant knew he/she was working in a part-time position. Applied for a part-time job and worked a part-time job. You should expect the claimant to argue that he/she was a full-time employee.

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3.2.4 Part-time employee with two (2) or more different employers with two (2) or more successive employments: • If the employee incurs a compensable injury in one of the employments, the employer in whose service the employee was injured shall pay the benefits due the employee. • If the employee is injured in one employment, but as a result of the injury also incurs loss of income from other successive employments, that employee shall be entitled to benefits computed by determining wages under the provisions of LSA-R.S. 23:1012(12)(a)(iv)(bb) using: ƒƒ ƒƒ

3.2.5 • •

Hourly rate in employment at the time of injury. Total hours worked for all employers of the part-time employee, but not to exceed average, actual weekly hours worked or 40 hours, whichever is less.

Seasonal employee, AWW is calculated using annual income divided by 52. Seasonal employment is any employment customarily operating only during regularly recurring periods of less than 44 weeks annually. If the employee was not engaged in the seasonal employment more than one (1) year prior to the accident, his/her annual income shall be the average annual income of other employees of the same or most similar class working in the same or most similar employment for the same employer or, in the event that the employee was the only individual engaged in that specific employment, then his/her annual income shall be the average annual income of other employees of the same or most similar class working for a neighboring employer engaged in the same or similar employment.

3.3 Monthly wages Employees paid on a monthly basis will have their monthly salary multiplied by 12 then divided by 52.

3.4 Annual wages Employees with an annual salary will have their annual salary divided by 52.

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3.5 Other wages If the employee is employed on a unit, piecework, commission, or other basis, AWW will be calculated using his/her gross earnings from the employer for the 26-week period immediately preceding the accident divided by the number of days the employee actually worked for the employer during said 26-week period and multiplied by the average number of days worked per week.

$10,000 gross earnings (26-week period preceding accident) _____________________ 130 days (worked during the 26-week period)

x 5

(average number of days However, if such an employee worked per week) has worked for the employer for less than a 26-week period immediately preceding the accident, his/her gross earnings from the employer for the period EXAMPLE OF DETERMINING AWW FOR EMPLOYEES WHO WORKED immediately preceding the 26-WEEK PERIOD IMMEDIATELY PRECEDING ACCIDENT accident divided by the number of days the employee actually worked for the employer during said period and multiplied by the average number of days worked per week.

=$384.62

RELATED CASE LAW CASE Groover v. Lafitte’s Boudoir, Inc., 162 So.3d 1184 (La. App. 4 Cir. 3/18/15)

DESCRIPTION Claimant, a bartender, injured his shoulder during an altercation with a co-worker. At the time of the accident, the claimant and employer had an agreement wherein the claimant was paid $400 a week plus tips. Without any documentary evidence, the WCJ ruled that the claimant failed to carry his burden that tips should be included in his AWW calculation. However, the Fourth Circuit found that a claimant’s own testimony is sufficient to prove a lost-wage claim, particularly when claimant’s testimony is corroborated by other evidence. Here, claimant’s co-worker provided testimony about the tips they made on a weekly basis, which supported the claimant’s testimony. As such, the Fourth Circuit vacated the WCJ’s calculation of claimant’s AWW at $400 and remanded the matter for proper calculation.

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3.6 Income tax (fringe benefits) When determining “wages” and the AWW at the time of the accident, no amount shall be included for any benefit or form of compensation which is not taxable to an employee for federal income tax purposes. However, any amount withheld by the employer to fund: •

Any nontaxable or tax-deferred benefit provided by the employer and which was elected by the employee in lieu of taxable earnings shall be included in the calculation of the employee’s wage; and Average weekly wage including but not limited to any amount withheld by the employer to fund any health insurance benefit provided by the employer and which was elected by the employee in lieu of taxable earnings shall also be included in the calculation of the employee’s wage and AWW.

RELATED CASE LAW CASE Sterling v. Asplundh Tree Expert Co., 856 So.2d 125 (La. App. 3 Cir. 10/1/2003)

DESCRIPTION The Court held that if the fringe benefit is specifically defined as non-taxable, it is not included in the AWW calculation. Such items pointed out by the Court as non-taxable include: •

Accident & Death Benefits

Employee Discounts

Achievement Awards

Employee Stock Options

Archer Medical Savings Accounts

Group-Term Life Insurance Coverage

Athletic Facilities

Lodging on Your Business Premises

De Minimis (Minimal Benefits)

Meals

Dependent Care Assistance

Moving Expense Reimbursements

Educational Assistance

No-Additional-Cost Services

Hargrave v. State DOTD, 54 So.3d 1102 (La. 1/19/2011)

The Supreme Court granted writs and affirmed the Third Circuit. The Court opined, “ In summary, we conclude the Court of appeal correctly found the OWC erred in including annual and sick leave to increase Mr. Hargrave’s AWW. The annual and sick leave actually used by Mr. Hargrave during the four (4) weeks preceding the accident became taxable when used, and already were included in the calculation of his AWW. To the extent the annual and sick leave hours were merely accrued and not used, these benefits are not taxable, and therefore should not be included in the determination of the AWW under LSA-R.S. 23:1021(12)(f). ”

Clay v. Our Lady of Lourdes, 71 So.3d 539 (La. App. 3 Cir. 7/13/11)

The Third Circuit originally reversed the WCJ’s calculation of the AWW, finding that additional fringe benefits should have been included in the calculation. The Louisiana Supreme Court granted writs and remanded the case back to the Third Circuit for reconsideration considering the Hargrave opinion as noted above. Upon remand, the Third Circuit reversed itself finding that the original WCJ calculation was correct by including only the employee’s averaged actual earnings received by her and taxed in the four (4) full weeks prior to her injury.

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CASE Malancon v. Ace Transp. LLC. 153 So.3d 471 (La. App. 1 Cir. 8/20/14), writ denied, 160 So.3d 974 (La. 11/21/14)

DESCRIPTION A trucking claimant leased a truck and was paid gross receipts which included rental of the truck. The WCJ calculated his AWW at one-third (1/3) of the gross receipts, based on industry standard as testified to by defendant’s company representative. The Court of appeal affirmed noting that in similar situations Courts have used: (1) The wages paid to another worker doing the same or similar work on a wage basis; (2) Deducted from the gross receipts the rental value of the equipment and related expenses incurred by the worker; or, (3) Used a percentage of the gross receipts typically used in the industry.

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4.

4. How to pay correctly and on time

How to pay correctly and on time

4.1 WHAT THE LAW STATES – TEMPORARY TOTAL DISABILITY BENEFITS (TTD) 4.2 WHAT THE LAW STATES – SUPPLEMENTAL EARNINGS BENEFITS (SEB) 4.3 WHAT THE LAW STATES – PERMANENT PARTIAL DISABILITY OR SCHEDULED LOSS BENEFITS (PPD) 4.4 WHAT THE LAW STATES – PERMANENT TOTAL DISABILITY BENEFITS (PTD OR “P&T”) 4.5 WHAT THE LAW STATES – DEATH BENEFITS

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4. How to pay correctly and on time There are several types of benefits and schedules for payment of Workers’ Compensation claims. Those include: • • • • •

Temporary Total Disability Benefits (TTD) Supplemental Earnings Benefits (SEB) Permanent Partial Disability or Scheduled Loss Benefits (PPD) Permanent Total Disability Benefits (PTD or “P&T”) Death Benefits

The following law and case law address each.

4.1 What the law states – Temporary Total Disability Benefits (TTD) LSA-R.S. 23:1221(1) - Temporary Total Disability Benefits (TTD) Benefit applies to any week in which claimant is unable to work in any capacity. This is not measured from the claimant’s point of view. It typically requires an out-of-work slip written by a physician. Indemnity payments are paid as nearly as possible to the same time that wages were paid.

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RELATED CASE LAW CASE Bridges v. Gaten’s Adventures Unlimited, L.L.C., 167 So.3d 992 (La. App. 1 Cir. 4/2/15)

DESCRIPTION Claimant was a bus driver who injured her lower back assisting a handicap child onto the bus. The WCJ found the claim to be compensable and awarded the claimant TTD benefits. The employer challenged the TTD award on appeal, arguing that the claimant failed to prove that she was physically unable to engage in any employment. In fact, claimant testified that she had never been told that she could not go back to work - only that she could not continue working as a driver. The First Circuit also noted there was only one medical record that mentioned any work restrictions, which allowed light duty work. Consequently, claimant was not entitled to TTD.

Maxwell v. Care Solutions, Inc., 179 So.3d 650 (La. App. 2 Cir. 9/30/15)

Claimant was employed by defendant as a caregiver. While walking to her car shortly after her shift ended, claimant was attacked by an unknown assailant who struck her in the face, fracturing facial bones and breaking her nose. At trial, the WCJ denied claimant TTD benefits because the claimant was unable to provide any medical evidence proving she was unable to work. However, this was largely due in part to the defendant refusing to authorize claimant’s medical treatment (as claimant could not afford treatment herself). The Second Circuit found that penalizing the claimant rather than the employer who denied the claimant the opportunity to receive necessary treatment would contradict the goals of the Louisiana Workers’ Compensation scheme of protecting injured workers. Accordingly, the appellate Court reversed the WCJ’s denial of TTD benefits and remanded the matter to be further evaluated with the appropriate medical evidence.

4.2 What the law states – Supplemental Earnings Benefits (SEB) LSA-R.S. 23:1221(3) - Supplemental Earnings Benefits (SEB) Benefit is applicable if the claimant is released to less than full duty work and unable to earn wages equal to ninety percent (90%) or more of his/her wages at the time of injury because of his/her injury or restrictions.

If the claimant has no Wage Earning Capacity and is not receiving any income from employment or self-employment, SEB benefits are paid in the same manner as TTD benefits – as nearly as possible to the same time that wages were paid. Otherwise, payments are due monthly. There is a total 520-week maximum cap applicable to SEB. You are allowed a week-for-week credit for other indemnity benefits paid. The burden is on the employee to prove loss of earning capacity, then the burden shifts to the employer to establish a Wage Earnings Capacity. Wage Earnings Capacity can be established: •

Through vocational rehabilitation that a suitable job exists within the claimant’s community or reasonable geographic region that conforms to the claimant’s restrictions and provides sufficient wages; or That the employer offered a position to the claimant within his/her restrictions.

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RELATED CASE LAW CASE Clark v. Sedgwick CMS, 179 So.3d 943 (La. App. 3 Cir. 11/25/15)

DESCRIPTION Employee injured his back lifting a case of radios at work. Defendant initially paid TTD, but reduced the payments to SEB shortly after claimant was declared at Maximum Medical Improvement (MMI), based on several positions identified through vocational rehabilitation and approved by the treating physician. The employee had applied for all of the positions and had contacted over 100 additional prospects without success. Following trial, the WCJ awarded SEB at the full TTD rate, concluding that “ there was no showing that jobs were available ” to the claimant when his benefits were reduced. The Third Circuit reversed, noting that the WCJ had incorrectly focused on job availability “ at the time [defendant] reduced benefits .” The Court found that the defendant had identified several jobs that fit the claimant’s restrictions, were in his geographical area, and were available when claimant was notified of their existence. The Court stated that “ physician approval is not required for the employer to meet its burden . . . ” Accordingly, the judgment was reversed to the extent it found defendant failed to prove available employment. The case was remanded to the WCJ to determine claimant’s earning capacity.

Marshall v. Town of Winnsboro, 184 So.3d 796 (La. App. 2 Cir. 11/25/15)

The Second Circuit affirmed the WCJ’s award of indemnity and medical benefits, penalties and attorney fees, rejecting contention that receipt of a pension constituted retirement, and stating: “The fact that an employee may receive some form of pension . . . in connection with his retirement from a job because of disability does not constitute retirement under LSA-R.S. 23:1221(3)(d)(iii).”

Meche v. Gray Ins. Co., 171 So.3d 640 (La. App. 3 Cir. 11/12/15)

Claimant injured his back in an unwitnessed accident, while swinging a sledge hammer. Although an Magnetic Resonance Imaging (MRI) was normal, claimant was referred to an orthopedic surgeon who disabled him and recommended physical therapy. The third orthopedist also provided restrictions. An Independent Medical Examination (IME) found that claimant could perform sedentary to light duty work, and employer offered a light duty position and terminated indemnity benefits. Claimant attempted the light duty job for two (2) days, but left due to pain. Claimant admitted to performing heavy manual labor for several months in the summer of 2014, earning $470 on these jobs and did not report them to his doctor. After trial, the WCJ awarded SEB at zero earning capacity through July of 2014, and based on actual earnings thereafter. The Third Circuit found that the light duty position offered by the defendant was inadequate to reduce benefits in the absence of approval by the claimant’s doctor. However, the Court concluded that the WCJ erred in awarding benefits after July of 2014, given the absence of any objective injury on the diagnostic tests and claimant’s admission that he performed heavy labor.

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CASE Andrews v. Thrasher Const. Co., 184 So.3d 92 (La. App. 1 Cir. 11/9/15)

DESCRIPTION Claimant was injured when he fell from scaffolding. He returned to work at some point but was fired after a fight with a co-worker. The Court awarded ongoing SEB based on zero earnings, and approved a functional capacity evaluation as recommended by the IME physician. The defendant appealed the award of SEB. On appeal, the Court rejected defendant’s assertion that the claimant’s termination precluded SEB. The Court noted that defendant’s Second Medical Opinion (SMO) physician and the IME physician both recommended a Functional Capacity Evaluation (FCE). It concluded that in the absence of the FCE, the WCJ had insufficient information to determine SEB entitlement, and remanded the case for further proceedings.

Harris v. City of Bastrop, 161 So.3d 948 (La. App. 2 Cir. 1/14/15)

Claimant, a fireman, injured his knee in 2001 while removing a smoldering mattress. He received 52 weeks of statutory sick leave, after which the employer initiated TTD. In August of 2002, the employer converted the indemnity benefits to SEB based on two (2) jobs identified via vocational rehabilitation. In 2011, the claimant filed a disputed claim, contending that his SEB had been reduced improperly based on the 2002 vocational rehabilitation, and that he was PTD. The WCJ found that only one (1) of the 2002 positions was appropriate, but that this was to the claimant’s detriment since the position paid a higher wage than the average of the two (2) jobs used by the employer. The Second Circuit affirmed, noting that the employee had apparently sabotaged attempts to return to work by immediately informing potential employers of and apparently exaggerating his use of pain medication.

Clay v. Our Lady of Lourdes Regional Medical Center, Inc., 93 So.3d 536 (La. 5/8/2012)

The Louisiana Supreme Court sided with the employer in this case and found that an employer is not required to show that a job was actually offered to the employee in Order to meet its burden of proof in establishing job availability and the employee’s earning capacity. You only need to show that the job was available when approved by the claimant’s treating physician.

Leonards v. Summit Claims, 101 So.3d 144 (La. App. 3 Cir. 10/3/2012)

The appellate Court affirmed the WCJ’s reduction of SEB based upon the availability of the job, rather than actual placement. The Third Circuit opined, “ It is clear that rejection of the employee’s application for an available job presents no impediment to proving an employee’s earning capacity. ”

Juneau v. Franciscan Ministries of Our Lady Health System, 103 So.3d 1083 (La. App. 1 Cir. 9/21/2012)

The Appeals Court in Juneau affirmed the WCJ ruling that the employee was provided meaningful vocational rehabilitation services when the vocational counselor provided thirteen (13) job leads over eight (8) months of service, of which six (6) were approved by the treating physician. Again, actual job placement was not required to establish the Wage Earnings Capacity.

4.2.1

Calculation of SEB

Determining whether SEB is due is dependent in part upon the applicability of the 90% threshold. In other words, if the Wage Earnings Capacity is greater than 90%, as an employer you owe no SEBs. When SEBs are owed, they are calculated using the following formula. To calculate SEB, if Wage Earnings Capacity is established or if the employee is working: •

First, calculate the Average Monthly Wage (AMW) by multiplying the Average Weekly Wage (AWW) by 52 weeks and dividing by 12 months.

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$2,000

Monthly SEB is then calculated by taking 100% AMW subtracting post-accident AMW (also called Monthly Wage Earnings Capacity) and multiplying that amount by two-thirds (2/3).

-

(pre-accident AMW)

$1,200

When the employee is terminated for cause, the wage loss is due to the employee’s action, not the injury. Recent case law raises the question of where the issue of termination for cause is to be litigated. This issue may have to be litigated in district court rather than workers’ compensation court.

(post-accident AMW or Monthly Wage Earnings Capacity)

x

2/3

= $533.33 (SEB due per month)

RELATED CASE LAW

MONTHLY SEB CALCULATION EXAMPLE: JOHN DOE HAS A PRE-ACCIDENT AMW OF $2,000, AND A POST-ACCIDENT AMW OF $1,200. TAKE JOHN’S PRE-ACCIDENT AMW ($2,000) MINUS HIS POST-ACCIDENT AMW ($1,200), THEN MULTIPLY THE DIFFERENCE BY TWO-THIRDS (2/3) ($2,000 - $1,200 = $800 X 2/3 = $533.33 SEB DUE PER MONTH)

CASE

DESCRIPTION

Guidry v. Louisiana Scrap Requires that the termination for cause issue be litigated in District Court not the Metal Recycling, WCA Worker’s Compensation Court. 16-864 (3rd Cir. 2016) Synigal v. Vanguard Car Rental, 951 So.2d 1197 (La. App. 5 Cir. 1/30/07)

The claimant returned to restricted duty but was then fired for cause prior to reaching MMI. The employee sued, seeking benefits for the time period between her firing and her reaching MMI.

Hurst v. Baker Sand Control, 671 So.2d 408 (La. App. 1 Cir. 10/6/95)

The employee was fired due to a well-documented morale problem after returning to work following back surgery.

Miller v. Christus St. Patrick Hospital, 100 So.3d 404 (La. App. 3 Cir. 10/24/12)

The Third Circuit calls the Synigal ruling into question when it confirmed the WCJ’s ruling that she did not have authority to decide whether someone was fired for cause, only whether that person was offered a job and refused to work. As such, this decision suggests that one will have to go to the District Court for the determination of whether someone was terminated for cause.

The Court sided with the employer, concluding, “It would be contrary to public policy to force an employer to pay Workers’ Compensation benefits to an employee who has been provided employment that meets his work restrictions and who is later fired for cause by blatantly violating his employer’s policies.”

The Court found that the employee’s inability to earn 90% of his pre-injury wages was not the result of his injury.

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CASE Darby-Cooley v. Blazin Concepts-Covington, LLC. d/b/a Buffalo Wild Wings, 167 So.3d 722 (La. App. 1 Cir. 11/7/14), 2014 - 0617

DESCRIPTION Claimant was injured and returned to light duty work with the employer. She was later terminated due to an altercation with a co-worker. Following trial the Court rejected claimant’s contention that the modified position exceeded her restrictions noting that she worked the job without issue until she was fired about four (4) and a half (1/2) months later. The Court held that claimant’s termination for cause precluded further indemnity benefits.

4.2.1(a) Employee lay offs When the employee is laid off for economic reasons, no SEB is due.

RELATED CASE LAW CASE Taylor v. Columbian Chemicals, 744 So.2d 704 (La. App. 2 Cir. 10/27/99)

DESCRIPTION The employee was unable to continue her employment with Columbian Chemicals because the plant shut down. At trial, the employee testified that she could and would have continued her former employment if it had not closed. As such, the Appeal Court found the employee was not entitled to SEB.

4.2.1(b) Employee retirement/withdrawal from workforce If an employee retires/withdraws from the workforce there is a cap.

4.2.1(b)(1) What the law states – Supplemental Earnings Benefits (SEB) LSA-R.S. 23:1221(3)(d)(iii) - Supplemental Earnings Benefits (SEB): There is a 104 week cap for those cases where the employee has retired or withdrawn from the workforce.

RELATED CASE LAW CASE

DESCRIPTION

Miley v. Bogalusa Fire Dep’t, 161 So.3d 319 (La. App. 1 Cir. 3/6/15)

After a trial on the merits, the WCJ found the claimant was entitled to SEB payments. The employer appealed, asserting that an award of SEB payments for a period of more than 104 weeks was erroneous because the claimant was retired and had no intention of returning to work. For purposes of SEB entitlement, “ retirement ” occurs when the employee either “ withdraws from the workforce ” or begins drawing old age Social Security benefits, whichever comes first. Making this determination requires a Court to consider several factors on a case-by-case basis, including whether the employee intends to continue working or not. Here, claimant testified that since being forced to leave the fire department, he applied to several businesses seeking employment. Therefore, claimant was not retired and the First Circuit found no error in the WCJ’s award of SEB benefits in excess of 104 weeks.

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appropriate. 1.

The information in this report is true for the period be _____________________, 20 ____.

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For the period covered in this report, did you receive a salar

THINGS kind? YOU NEEDYes TO KNOW No

If yes, give name and address of employer _______________ If yes, give your gross earnings________________________

4.2.1(c) SEB paid at the same time and place as wages to covered the employee 3. were For payable the period in thisbefore report,the were you self-employed accident not limited to farming, sales work, operating a business (even •

any type business. No SEB is paid at the same time and place as wageswork, were or payable to of thefamily employee before the Yes accident, but only if the claimant is not working and there is no Wage Earnings Capacity If yes, describe the type of business you are involved in, y established.

business. _________________________________________ ________________________________________________

RELATED CASE LAW 4.

CASE

Did you perform any volunteer work during the period covere

DESCRIPTION

Washington v. Louisiana-I Gaming, 163 So.3d 809 (La. App. 5 Cir. 12/23/14)

If yes, describe the type of volunteer work you performed. __

Claimant allegedly suffered two (2) compensable slip and falls. She returned to work after the first incident but notified the employer that she intended to retire and gave two (2) Did you receive any unemployment weeks’ notice. Shortly thereafter she5.suffered a second incident. She was releasedinsurance to light duty and the employer testified that light duty positions were available.

benefits for the

If yes, how much? __________________ For how many we

The Court of appeal reversed the WCJ’s award of SEB finding that any loss of earnings was due to claimant’s retirement rather than her injury.

6.

4.2.1(d) LWC-WC-1020 (the “1020”)

Did you receive any old age insurance benefits under Title II o If yes, how much? ___________________

LWC-WC-1020 allows employers to evaluate monthly earnings as a prerequisite to payment of 7. Did you receive any Social Security Disability Benefits, reti SEB.

benefits?

Yes

No

EMPLOYEE’S MONTHLY REPORT OF EARNINGS

If yes, how much? _______________ What type of benefit You must submit this report to your employer’s workers’ compensation insurer within 30 days of your job-related injury, and every 30 days as long as you receive workers’ compensation indemnity benefits. You do not have to submit this report if you have only received medical benefits. Your workers’ compensation benefits may be suspended if you do not timely submit this report. Warning: Per L.R.S. 23:1208 of the Louisiana Workers’ Compensation Statute, it shall be unlawful for a person, for the purpose of obtaining or defeating any benefit payment under the provisions of this Chapter, either for himself or for any other person, to willfully make a false statement or representation. Penalties for violations include imprisonment, fines, and/or the forfeiture of benefits.

EMPLOYEE’S MONTHLY REPORT OF EARNINGS DO NOT leave any blanks on this report. appropriate.

Employee Cert

Print or type all responses, and use Not Applicable (N/A) or Zero (-0-) where

I certify that I understand the contents of this entire docume You must submit this report to your employer’s workers’ insurer 30 days your job-rel certify my answerscompensation are complete and true,within and certify myofcompliance w days as long as you receive workers’ compensation indemnity benefits. You do not have to submit this received medical benefits. Your workers’ compensation benefits may be suspended if you do not timely submit ________________________________________________ 1.

The information in this report is true for the period beginning _________________________, 20___ and ending _____________________, 20 ____.

2.

For the period covered in this report, did you receive a salary, wage, sales commission, or payment, including cash, of any kind? Yes No If yes, give name and address of employer __________________________________________________________________ If yes, give your gross earnings___________________________________________________________________________

3.

Print Name

For the period covered in this report, were you self-employed or involved in any business enterprise? These include but are not limited to farming, sales work, operating a business (even if the business lost money), child care, yard work, mechanical work, or any type of family business. Yes No

Signature

If yes, describe the type of business you are involved in, your job duties, and the amount of income received from the business. ____________________________________________________________________________________________ ____________________________________________________________________________________________________

Warning: Per L.R.S. 23:1208 of the Louisiana Workers’ Compensation Statute, it shall be unlawfu purpose of obtaining or defeating any ________________________________________________ benefit payment under the provisions of this Chapter, either for hi Physical/Street Address City State/Zip include imprison person, to willfully make a false statement or representation. Penalties for violations forfeiture of benefits. ________________________________________________ 4.

Did you perform any volunteer work during the period covered in this report?

Yes

No

If yes, describe the type of volunteer work you performed. _____________________________________________________

5.

Did you receive any unemployment insurance benefits for the period covered in this report?

Yes

No

If yes, how much? __________________ For how many weeks? ____________

6.

Did you receive any old age insurance benefits under Title II of the Social Security Act?

_ Yes

No

If yes, how much? ___________________

7.

Date of Injury

Did you receive any Social Security Disability Benefits, retirement benefits, or any other type of disability or government benefits? Yes No

Claim Number

DO NOT leave any blanks on this report. Print or type all responses, and use Not Applicable (N/A appropriate. LWC-WC 1020 If yes, how much? _______________ What type of benefits did you receive? ___________________________________ Employee Certification

I certify that I understand the contents of this entire document and understand I am held responsible for this information. I certify my answers are complete and true, and certify my compliance with the Louisiana Workers’ Compensation Act.

REVISED 07/08/2008

________________________________________________

1.

Print Name

Signature

________________________________________________ Social Security Number

Date

The information in this report is true for the period beginning ________________________ _____________________, 20 ____. ________________________________________________

_____(_________)___________________________________

________________________________________________

____________________________(______)______________

Physical/Street Address Date of Injury

City

State/Zip

Claim Number

Telephone Number

Insurer

Telephone Number

LWC-WC 1020 REVISED 07/08/2008

2.

LWC-WC-1020 FORM For the period covered in this report, did you receive a salary, wage, sales commission, or payment kind? Yes No

If yes, give name and address of employer _______________________________________________ ALLEN If yes, give your gross earnings________________________________________________________ 3.

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For the period covered in this report, were you self-employed or involved in any business enterprise not limited to farming, sales work, operating a business (even if the business lost money), child care work, or any type of family business. Yes No

9:43 AM If yes, describe the type of business you are involved in, your job duties, and4/13/17 the amount of inc business. _________________________________________________________________________


4.3 What the law states – Permanent Partial Disability or Scheduled Loss Benefits (PPD) LSA-R.S. 23:1221(4) - Permanent Partial Disability or Scheduled Loss Benefits (PPD) Scheduled losses for a body part. The compensation shall be solely for anatomical loss of use or amputation as specifically outlined under 23:1221(4). • • • •

Impairment or anatomical loss must be made in accordance with the latest edition of the American Medical Association Guidelines to the Evaluation of Permanent Impairment Loss is subject to a week-for-week credit based upon other indemnity benefits previously paid. Louisiana does not recognize “whole body impairments” or PPD for the neck or back. Benefits are due within 30 days from receipt of medical report setting forth an impairment rating under the most recent AMA guidelines.

This includes scarring.

RELATED CASE LAW CASE

DESCRIPTION

Dupard v. MMR Constructors, Inc., 182 So.3d 144 (La. App. 1 Cir. 9/18/15), 20150019

Claimant injured her knee at work when she was struck by a hammer that fell from above. Incident resulted in a laceration to her right knee, which later developed into a scar. The WCJ granted claimant 25 weeks of PPD benefits for her scar. On appeal, the First Circuit analogized claimant’s PPD award to what she would have been awarded for the loss of a finger or toe pursuant to the corresponding compensation schedule, which would have only been 20 and 10 weeks respectively. Considering the severity of claimant’s scar and the fact that she sustained no loss of functionality, the First Circuit reduced the WCJ’s award finding that the highest award the WCJ could have properly made was an award of 10 weeks of PPD benefits.

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4.4 What the law states – Permanent Total Disability Benefits (PTD or “P&T”) LSA-R.S. 23:1221(2) - Permanent Total Disability Benefits (PTD or “P&T”) If the injury prevents claimant from engaging in any type of gainful employment, these benefits are owed. Employee must prove by clear and convincing evidence unaided by any presumption of disability that he/she is physically unable to engage in any employment. This requires a review of the results of vocational rehabilitation which thereby incorporates various factors related to the employee apart from simple physical limitations – age, education, race, literacy and experience.

RELATED CASE LAW CASE

DESCRIPTION

Allensworth v. Grand Isle Shipyard, Inc., 178 So.3d 191 (La. App. 5 Cir. 10/28/15)

Claimant filed a disputed claim alleging that his diagnosis of non-Hodgkin’s lymphoma was a result of his exposure to benzene while cleaning storage tanks for his employers. Because the claimant failed to prove causation at trial, the PTD issue became moot. Nevertheless, the Fifth Circuit addressed the issue. The claimant’s argument for PTD was supported by his own testimony, a Social Security Administration determination that he was disabled, and a physical capacity evaluation completed by his treating physician at the same time claimant was receiving treatment for his non-Hodgkin’s lymphoma. The appellate Court highlighted that the claimant provided no current medical records to support his inability to work at the time of the worker’s compensation hearing. Thus, claimant failed to meet his burden in establishing PTD.

Stelly v. CNA Ins. Co., 177 So.3d 159 (La. App. 3 Cir. 10/21/15)

Claimant was injured in a work-related accident in 2005. In 2014, claimant filed a LWC-WC-1008 (the “1008”) seeking PTD benefits. The WCJ recognized the medical evidence supported claimant was PTD, but because the plaintiff testified that he was “ capable of doing some physical activity ” the WCJ awarded claimant TTD status until an FCE could be conducted. The TTD award was reversed by the Third Circuit, who stated that the WCJ improperly relied on claimant’s ability to perform “ some physical activities ,” rather than his ability “ to engage in any self-employment or occupation for wages .” Further, the Third Circuit found the claimant met his burden of proving PTD status and that the FCE unnecessary due to all of the previous and unsuccessful rehabilitation efforts.

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CASE

DESCRIPTION

Young v. City of Claimant fell and injured her back in 2000 and never returned to work. Claimant filed Gonzales, 2014-1299 a 1008 seeking PTD benefits after her benefits were terminated in 2011. Her treating (La. App. 1 Cir. 3/12/15) physician testified that he was unsure whether claimant could tolerate sustained employment because of her back injury. Claimant’s vocational rehab counselor opined it was unrealistic that claimant could be gainfully employed. Thereafter, claimant’s treating physician issued a supplemental report stating that the claimant could not return to work in any capacity because she was PTD. Claimant’s treating neurosurgeon opined that claimant could be gainfully employed at sedentary level, in contrast to claimant’s vocational rehab counselor and treating physician. Due to the disparity in medical opinions the Court appointed an IME, which opined that claimant could perform sedentary work, but would be unlikely to sustain such employment. Ultimately, the WCJ found that the claimant was PTD – a decision that was affirmed by First Circuit. Davis v. General Motors, 49,645 (La. App. 2 Cir. 2/26/15)

Claimant injured both shoulders in 1999 and has not worked since her injury. In addition to her work injury, claimant has had several other medical issues since that incident. In 2009, claimant’s SEB benefits were terminated after reaching the 520 week maximum, which prompted the filing of a 1008 seeking PTD benefits. However, her recent medical records offered to support her continuing disability were unrelated to her shoulder and work-related incident. Claimant underwent an FCE and SMO, both of which found the claimant was capable of sedentary work. However, a vocational rehab counselor found that the claimant’s low IQ meant that she would not qualify for light-duty jobs. The WCJ ultimately ruled that the claimant failed to prove that her ongoing disability was attributable to her work-related injury, and denied benefits. The Second Circuit affirmed.

Aucoin v. CNA, 111 So.3d 31 (La. App. 1 Cir. 9/21/12)

The First Circuit found that an employee with sporadic earning was precluded from making a claim for permanent and total disability. The employee in this case worked as a “keeper of the keys” for the East Feliciana Parish Clerk of Court, wherein he received $75 every election. In addition, the employee was paid monthly to watch his neighbor’s property.

4.5 What the law states – Death Benefits LSA-R.S. 23:1210- Death Benefits Provides that burial expenses of no more than $8,500 must be paid. There are scheduled benefits based upon the remaining dependents. 4.5.1 Lump-sum payout after death If there are no legal dependents, a lump-sum payment of $75,000 shall be paid to the employee’s surviving biological and adopted children who are over the age of majority, to be divided equally among them, which shall constitute the sole and exclusive compensation. If no dependents, then $75,000 is owed per surviving parent.

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How does the NEW preliminary determinaton process work?

5.1 WHAT THE LAW STATES – CONTROVERSION OF COMPENSATION AND MEDICAL BENEFITS 5.2 UPON FIRST PAYMENT OF COMPENSATION . . . 5.3 UPON ANY MODIFICATION, SUSPENSION, TERMINATION OR CONTROVERSION OF COMPENSATION OR MEDICAL BENEFITS . . . 5.4 AFTER RECEIPT OF THE 1002 BY THE EMPLOYEE 5.5 IF AFTER RECEIPT OF NOTICE OF DISAGREEMENT THE EMPLOYER DOES NOT CHANGE ITS MIND . . . 5.6 AFTER A REQUEST FOR A PRELIMINARY DETERMINATION . . . 5.7 AFTER A RULING BY THE COURT AT THE PRELIMINARY DETERMINATION HEARING . . . 5.8 EXPEDITED SUMMARY PROCEEDINGS

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5. How does the NEW preliminary determination process work? The NEW hearing process significantly changes how preliminary issues are handled.

5.1 What the law states – Controversion of compensation and medical benefits LSA-R.S. 23:1201.1 – Compliance This process requires perfect compliance with the rules regarding how and when things are mailed. As the statutes are so specific, “close enough” is not an option.

5.2 Upon first payment of compensation . . . • •

SEQUENCE OF EVENTS: UPON FIRST PAYMENT OF COMPENSATION

Send copy of Prepare the LWC-WC-1002 (the “1002”). Send Initial Prepare 1002 Notice of Payment Indemnity (LWC-WC-1002) Send initial indemnity payment to the to OWC Payment employee on the same day as the first payment of compensation (not required DIAGRAM 5-1: UPON FIRST PAYMENT OF COMPENSATION to be by certified mail). Send a copy of the notice of initial indemnity payment to the Office of Workers’ Compensation (OWC) within 10 days. As of April 1, 2015, the OWC no longer maintains the envelopes in which the copy of indemnity payment notification is mailed. Thus, parties must obtain proof of delivery independently of the OWC.

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5.3 Upon any modification, suspension, termination or controversion of compensation or medical benefits . . . • •

Prepare the 1002. Send the 1002 to the employee by certified mail on or before the effective date of the change or termination of benefits at the place where the employee is receiving benefits. If claimant is represented by an attorney, send to the attorney by fax. ƒƒ

SEQUENCE OF EVENTS: UPON ANY MODIFICATION, SUSPENSION, TERMINATION OR CONTROVERSION OF COMPENSATION OR MEDICAL BENEFITS Send 1002 to Employee by Certified Mail and/or Fax Copy to Attorney

Prepare 1002 (LWC-WC-1002)

Send 1002 to OWC

DIAGRAM 5-2: UPON ANY MODIFICATION, SUSPENSION, TERMINATION OR CONTROVERSION OF COMPENSATION OR MEDICAL BENEFITS

If the claimant is having his/her benefits sent to an attorney’s office, you should technically send the 1002 to the claimant and fax the attorney’s office a copy.

Send the 1002 to the OWC on the same day it is sent to the employee.

EMPLOYER/PAYOR MAIL TO:

EMPLOYER/PAYOR MAIL TO:

1. Employee Social Security No. ______ -_____-_______

OFFICE OF WORKERS' COMPENSATION POST OFFICE BOX 94040 BATON ROUGE, LA 70804-9040

3. Date of Injury/Illness ___________________________

2. Payor Claim No.:______________________________

1. Employee Social Security No. ______ -_____-_______ 4. Date of Notice: ________________________________

OFFICE OF WORKERS' COMPENSATION POST OFFICE BOX 94040 BATON ROUGE, LA 70804-9040

NOTICE OF PAYMENT, MODIFICATION, SUSPENSION, TERMINATION OR CONTROVERSION OF COMPENSATION OR MEDICAL BENEFITS

2. Payor Claim No.:______________________________ 5. Purpose of Form (check one): Initial Payment ____

Modification ____

Suspension ____

Termination____

Controversion ____

3. Date of Injury/Illness ___________________________ 6.

(a)

Employee Name: ____________________________________________________ Address: ____________________________________________________ Telephone: __________________________________________________

4. Date of Notice: ________________________________ (b)

Employee Representative Name (if known)_________________________________ Address: ____________________________________________________ ____________________________________________________ Telephone: ___________________________________________________ Facsimile: ____________________________________________________

NOTICE OF PAYMENT, MODIFICATION, SUSPENSION, TERMINATION OR CONTROVERSION OF COMPENSATION OR MEDICAL BENEFITS (c)

7. Effective Date of Initial Payment, Modification, Suspension, Termination or Controversion:______/______/20_____

5. Purpose of Form (check one): Initial Payment ____

Modification ____

Employer Name: ____________________________________________________ Address: ____________________________________________________ _____________________________________________________ Telephone: ___________________________________________________ Facsimile: ____________________________________________________

8. Description of Injury/Occupational Disease: ________________________________________________________ ______________________________________________________________________________________________

Suspension ____

9. Average Weekly Wage: $__________________

Termination____

Controversion ____

10. Payment/Modification (check one): Initial Payment ____

Modification____

Indemnity Benefits are to be paid as follows:

6.

(a)

Employee Name: ____________________________________________________ Address: ____________________________________________________ Telephone: __________________________________________________ A.

Permanent Total Disability (PTD)___ Temporary Total Disability (TTD)___ (check one) benefits at the rate of $_____________ per week;

B.

Supplemental Earnings Benefits (SEB) paid at the rate of $__________________per ________________ based on a wage earning capacity of $________________________; OR

SEB paid at the rate of$ _______________ per ________________ dependent on wages as reflected in LWCWC-1020’s to be submitted by employee each month;

C.

Reduced PTD___ TTD____ SEB_____ (check one) at the rate of $___________ due to employee’s receipt of (check applicable item): _____ Social Security Benefits at the rate of $______________ per _____________; _____ Other Workers' Compensation Benefits at the rate of $__________ per _________’ _____ Employer Funded Disability Benefits at the rate of $___________ per __________; _____ Unemployment Insurance Benefits _____ Third Party Recovery in the amount of $_______________ _____ 50% reduction of compensation based on Employee’s refusal to cooperate with Vocational Rehabilitation _____ Reduction due to child support order _____ Other (Describe): _________________________________________________________

(b)

Employee Representative Name (if known)_________________________________ Address: ____________________________________________________ ____________________________________________________ Telephone: ___________________________________________________ Facsimile: ____________________________________________________

(c)

Employer Name: ____________________________________________________ Address: ____________________________________________________ _____________________________________________________ Telephone: ___________________________________________________ 30 Facsimile: ____________________________________________________

LWC-WC-1002 FORM

7. Effective Date of Initial Payment, Modification, Suspension, Termination or Controversion:______/______/20_____ 8. Description of Injury/Occupational Disease: ________________________________________________________ ______________________________________________________________________________________________

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5.4 After receipt of the 1002 by the employee . . . 5.4.1

If employee disagrees with the 1002, he/she has to send notice. • •

Premature to file LWC-WC-1008 (the “1008”) without Notice of Disagreement. Since there is no time frame to file a disagreement, claimant or claimant’s attorneys are sending the Notice of Disagreement once employer or employer’s attorney files the Exception of Prematurity.

5.4.2 If the Notice of Disagreement causes the employer to change its mind: •

If the employer pays what is owed within seven (7) business days of receipt of the Notice of Disagreement – the employer does not owe penalties or attorneys’ fees.

SEQUENCE OF EVENTS: AFTER EMPLOYEE RECEIPT OF 1002 Notice of Disagreement

Employer Comes to Agree

Employer Continues to Disagree

Employer Pays within 7 Days of Notice of Agreement

Request Preliminary Determination (1008 Pending)

(No penalties or attorney's fees are owed.)

Telephone Conference

5.5 If after receipt of Notice of Disagreement the employer does not change its mind . . . 5.5.1

Request a Preliminary Determination in the answer or amended answer. •

• •

Discovery

Parties Exchange Evidence

Preliminary

Determination If a 1008 is already pending – request Hearing an amended answer within 15 days after expiration of seven (7) business days DIAGRAM 5-3: AFTER EMPLOYEE RECEIPT OF 1002 (of receipt of Notice of Disagreement). The Preliminary Determination shall be accompanied by a copy of the 1002 and Notice of Disagreement, along with a Motion and Order to set telephone status conference. A telephone status conference is set within 15 days from receipt of the answer or amended answer and a Preliminary Determination will be set within 90 days from that conference. The deadline for discovery shall be 30 days before the Preliminary Determination hearing and the parties must exchange evidence 15 days before the hearing. After the phone conference, an Order will be sent to all parties within three (3) days setting forth the above described deadlines and include the issues to be determined. After the hearing, the Court forwards a written Preliminary Determination to the parties within 30 days of the hearing. A notice is also sent advising the parties of their options to accept or reject the findings. If the Court does not receive written notification of further action by the parties within 15 days, the Court will close the file or proceed to trial on remaining issues.

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Payor MUST have complied with all requirements and accepted the claim as compensable, subject to further investigation to determine entitlement to a Preliminary Determination. As an employer or insurer, if you have followed all of the rules and accepted the claim as compensable, you may be protected from penalties and attorneys’ fees under the following circumstances: • •

If you originally accept the claim and comply with all the requirements, nothing prevents you from later controverting a claim under the “subject to further investigation” rule. If you have followed all rules, you may be able to avoid penalties and attorneys’ fees. In the law, this type of protection is known as a “safe harbor.”

If you do not follow the rules, then you can be subject to penalties and attorneys’ fees under the old rules. NOTE – You are not automatically subject to penalties and attorneys’ fees just because you are not entitled to the safe-harbor protections. Claimant still has to prove the claim. Claimant may file a rule to show cause to test an employer’s or insurer’s entitlement to safe-harbor protection.

5.6 After a request for a Preliminary Determination . . . • •

Judge schedules a telephone status conference. Discovery is limited to the issues raised in the 1002. ƒƒ

ƒƒ

Currently, there are no cases on how this will be interpreted.

Hearing held within 90 days from telephone status conference. One continuance is available for 30 days.

Court has to issue a decision within 30 days of hearing.

5.7 After a ruling by the Court on the Preliminary Determination hearing . . . Within 10 calendar days, you must: • •

Accept and comply – in which case no penalties and attorneys’ fees would be owed. Accept and comply under protest – still no penalties and attorneys’ fees owed. ƒƒ

Notify Court within 10 days of desire to go to trial.

Reject – may be subject to penalties and attorneys’ fees.

Acceptance of a Preliminary Determination is not an admission of liability.

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5.8 Expedited summary proceedings Upon Motion of either party, whether or not employer is entitled to a Preliminary Determination, the following matters will be conducted as an expedited summary proceeding. •

Employee’s right to choice of physician. ƒƒ

Not to be used to change physician.

• • •

Employee’s right to vocational rehabilitation. Compel employee to sign choice of physician form. Compel SMO/IME.

• • • •

Compel employee to return LWC-WC-1025 EE (the “1025”) or LWC-WC-1020 (the “1020”). Lift suspension for failing to attend SMO/IME appointment. Lift suspension for failing to sign fraud form. Lift suspension for failing to cooperate with vocational rehabilitation.

Hearing is to be not less than 10 and not more than 30 days from filing of Motion. If employer is entitled to Preliminary Determination and complies with Order issued after the hearing within 10 calendar days, no penalties or attorneys’ fees would be owed.

RELATED CASE LAW CASE Bowie v. Westside Habilitation Ctr. 150 So.3d 671 (La. App. 3 Cir. 11/5/14)

DESCRIPTION Claimant injured her knee and lower back and benefits were initially paid. At some point the insurer notified claimant that it would no longer pay benefits for her left knee injury which it deemed pre-existing. A dispute arose and the insurer requested a Preliminary Determination which claimant challenged. The WCJ concluded that the insurer was entitled to a Preliminary Determination. The Third Circuit concluded that defendants could not prove compliance regarding notice of initial payment. Thus, even though the dispute did not concern the initial payment, under a strict reading of the statute, the defendants were not entitled to a Preliminary Determination. A dissent noted that since the claim was initially accepted the defendants should be entitled to a more expedited process, but should not be entitled to the statute’s safe harbor provisions.

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P A G E

I N T E N T I O N A L L Y

L E F T

B L A N K

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What are vocational rehabilitation obligations?

6.1 WHAT THE LAW STATES – REHABILITATION OF INJURED EMPLOYEES 6.2 REHABILITATION OF INJURED EMPLOYEES

6. What are vocational rehabilitation obligations?

6.

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6. What are vocational rehabilitation obligations? Before the Court finds a claimant to be permanently and totally disabled, the Workers’ Compensation Judge (WCJ) determines whether there is a chance that the claimant can be returned to work with appropriate retraining or education. Employers may be required to provide these services for the claimant.

6.1 What the law states – Rehabilitation of injured employees LSA-R.S. 23:1226 – Rehabilitation of Injured Employees When an employee has suffered an injury that prevents the employee from earning wages equal to wages earned prior to the injury, the employee shall be entitled to prompt rehabilitation services.

6.2 Rehabilitation of injured employees Vocational rehabilitation services must be provided by a licensed professional vocational rehabilitation counselor. While returning the employee to the same position is always preferred, the law provides for other options. These other options must first consider a local pool of positions before considering statewide options. The employer is responsible for the selection of a licensed professional vocational rehabilitation counselor to evaluate and assist the employee in his/her job placement or vocational training.

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RELATED CASE LAW CASE

DESCRIPTION

Hargrave v. State, 100 So.3d 786 (La. 10/16/2012)

In this decision, the Louisiana Supreme Court found that a WCJ could NOT require vocational rehabilitation counselors to abide by employee-requested conditions, including that counseling meetings be held at the office of the employee’s attorney and that counsel refrain from questioning as to fact not necessary to provide rehabilitation. This decision came as a result of a common practice of an infamous Crowley attorney who was forcing vocational rehabilitation counselors to sign a “ voc rehab contract ” prior to starting rehabilitation services.

Clay v. Our Lady of Lourdes Regional Medical Center, Inc., 93 So.3d 536 (La. 5/8/2012)

The Louisiana Supreme Court highlighted what an employer may do to discharge its burden of proving “job availability” under LSA-R.S. 23:1221, specifically, that it must establish by competent evidence: •

The existence of a suitable job within claimant’s physical capabilities and within claimant’s or the employer’s community or reasonable geographic region;

The amount of wages that an employee with claimant’s experience and training can be expected to earn in that job; and

An actual position available for that particular job at the time that the claimant received notification of the job’s existence.

An expedited procedure shall be available to the employer to require the employee’s cooperation in the rehabilitation process. Refusal to accept rehabilitation as deemed necessary by the WCJ shall result in a fifty (50) percent reduction in weekly compensation, including supplemental earnings benefits pursuant to LSA-R.S. 23:1221(3), for each week of the period of refusal. Allen v. Affordable Home Furnishings, 149 So.3d 836 (La. App. 3 Cir. 10/1/14)

Claimant refused to participate in vocational rehabilitation after the consultant would not agree with terms imposed by claimant’s attorney. The attorney filed a Motion to compel and to reduce benefits pursuant to LSA-R.S. 23:1226. The WCJ reduced benefits by 50% pending cooperation with vocational rehabilitation.

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What are the Louisiana Medical Treatment Guidelines (MTG) and paying benefits?

7.1 HOW THE PROCESS WORKS 7.2 1009 APPEAL PROCESS – FILING OF 1008 TO ADDRESS DECISION OF MEDICAL DIRECTOR 7.3 DO THE LOUISIANA GUIDELINES APPLY TO . . . ? 7.4 ROUTINE VISITS BEYOND THE $750 LIMIT 7.5 PAYMENT OF MEDICAL BENEFITS 7.6 CHOICE OF PHYSICIAN 7.7 CHOICE OF PHARMACY 7.8 SECOND MEDICAL OPINION (SMO) 7.9 INDEPENDENT MEDICAL EXAMINATION (IME) 7.10 WHAT IF A CLAIMANT DOES NOT FOLLOW-UP WITH TREATMENT?

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7. What are the Louisiana Medical Treatment Guidelines (MTG) and paying benefits? The Louisiana Supreme Court held that the Louisiana Medical Treatment Guidelines – or Louisiana Guidelines – apply to all requests for medical treatment that take place after July 13, 2011, regardless of the date of the accident.

7.1 How the process works The Louisiana Guidelines call for a four (4) step process: • • • •

STEP STEP STEP STEP

1: Making a request for treatment to the payor. 2: Review of the request for treatment by the payor. 3: Appeal by the provider (if there is a dispute). 4: Appeal decision.

There are two (2) forms important to this discussion: LWC-WC-1009 ( the “1009”) and LWC-WC-1010 (the “1010”). The 1009 is issued to appeal the denial of the 1010. The 1010 is used to begin the process and is a request for treatment. 7.1.1

STEP 1 – Make a request The medical provider begins by submitting to the payor – typically an insurance company or employer – the request for treatment using the 1010. All non-emergency treatment requested – at a minimum – requires the following specific information: • • • • •

Medical history of the patient; Physical findings/clinical test results; Documented functional improvement; Test/imaging results; and A treatment plan.

Failure to provide this information does not begin the deadline by which the payor must review the request.

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7.1.2

STEP 2 – Review by payor

The request for treatment will have to be reviewed using the Louisiana Guidelines only. At this time, there is case law supporting that the reviewing physician must be licensed in Louisiana. The only time that a request can be reviewed outside of the Louisiana Guidelines is when the Louisiana Guidelines do not address the situation. In that case, the out-of-state guidelines utilized must be identified. This use of other medical guidelines is an example of a “variance.”A variance request must show why a variance from the Louisiana Guidelines is necessary to cure or relieve the claimant from the effects of his/her injury. The variance request must include scientific medical literature that is higher ranking and is more current than that relied upon by the Louisiana Guidelines. When the Louisiana Guidelines do not cover a specific request, the 1009 must show that the documentation relied upon to provide guidance is supported by comprehensive, ongoing systematic medical literature review. For more on the 1009, see STEP 3 below. On the 1010, your options are: • • •

Requested treatment or testing is approved. Requested treatment or testing is approved with modifications – attach summary of reasons and explanation of any modifications. Requested treatment or testing is denied because: ƒƒ

Treatment or testing is not in accordance with the Medical Treatment Schedule or LSA-R.S. 23:1203.1(D).

ƒƒ ƒƒ ƒƒ

Request, or a portion thereof, is not related to the on-the-job injury. Claim is being denied as non-compensable. Other

»»

»»

A summary of reasons must be attached.

For issues that fall into the “other” category, attach a brief explanation.

After all information above has been received, the payor shall notify the provider within five (5) business days of the receipt of their decision. If there is no response within five (5) business days, the request is deemed denied. This may open up an employer or insurer to a penalty claim. If an employer or insurer denies the treatment, it has 10 calendar days in which to approve the treatment and the employer or insurer will be given a presumption of good faith. 7.1.3

Step 3 – Appeal by the provider – filing of 1009

According to the Louisiana Guidelines, if there is a dispute as to whether the request is in accordance with the Louisiana Guidelines, or whether a variance is required, the aggrieved party shall file an appeal with the OWC Medical Director using the 1009 within 15 calendar days. 7.1.4

Step 4 – Appeal decision form

The Medical Director shall render a decision as soon as is practicable, but no more than 30 days after the filling of the 1009.

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7.2 1009 appeal process – Filing of 1008 to address decision of Medical Director The aggrieved party can file an appeal of the Medical Director’s decision by filing a LWC-WC-1008 (the “1008”). • •

This must be filed within 15 calendar days of the decision being mailed. An expedited hearing will be set within 15-30 days.

The decision will only be overturned if there is a showing by clear and convincing evidence that the Medical Director’s decision was not in compliance with the Guidelines. Recent case law states that if the review of the 1009 was not conducted by the Medical Director or Assistant Medical Director, then the clear and convincing burden does not apply.

SEQUENCE OF EVENTS: REQUEST FOR TREATMENT AND 1009 APPEAL PROCESS STEP 1

STEP 2

STEP 3

STEP 4

1009 Appeal

Request for Treatment

Payor Review and Treatment Decision

Appeal by Provider

Appeal Decision by Medical Director (MD)

Appeal of MD's Decision

(LWC-WC-1010)

(LWC-WC-1009)

(LWC-WC-1008)

DIAGRAM 7-1: REQUEST FOR TREATMENT AND 1009 APPEAL PROCESS

RELATED CASE LAW CASE Ardoin v. Calcasieu Parish School Bd. 184 So.3d 896 (La. App. 3 Cir. 2/3/15), 15-814

DESCRIPTION Claimant hurt his back, had surgery, and later was prescribed an adjustable bed. Employer denied the 1010 for the bed. The claimant filed 1009 which was denied by the Medical Director when he stated “ It is generally felt that large expense purchases such as spas, whirlpools, and special mattresses are not necessary to maintain function . . . ” Claimant filed 1008 seeking authorization of the requested bed and penalties and attorneys’ fees for denying the claim. WCJ Orders the employer to authorize the bed request and awards penalties and attorneys’ fees. The Third Circuit affirmed holding that the employer cannot rely generally on the Louisiana Medical Treatment Guidelines (MTG), but must have factual and medical evidence for the specific claimant at the time of the denial.

Gilliam v. Brooks Heating & Air Conditioning, 146 So.3d 734 (La. App. 2 Cir. 7/16/14)

The Second Circuit held that the parties may offer and the WCJ may consider evidence not submitted to the Medical Director. It should be noted that there was no objection to the introduction of new evidence in this matter.

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CASE Soniat v. Crown Buick & Risk Mgmt. Servs., 166 So.3d 278 (La. App. 5 Cir. 12/16/14)

DESCRIPTION Appellate Court affirmed the WCJ’s award of penalties and attorneys’ fees despite the Medical Director agreeing with the employer’s denial of the requested medical treatment. The WCJ reasoned that the “ mere fact that the Medical Director subsequently agreed with Crown Buick’s decision to deny the injections neither exonerates Crown Buick for its improper actions nor protects it from the assessment of penalties and attorneys’ fees under LSA-R.S. 23:1201(F).

The proper inquiry determining whether to impose penalties and attorneys’ fees on an employer is whether the employer had an articulate and objective reason to deny benefits at the time it took action; in other words, whether the employer reasonably controverted the requested medical treatment at the time of its initial refusal.” Wilson v. Broadmoor, Medical Director’s denial of medical treatment was overturned by the WCJ. At the trial LLC, 169 So.3d 463 (La. on the merits, the WCJ denied the introduction of the employer’s Utilization Review (UR) App. 5 Cir. 3/11/15) report, citing that the report was not competent evidence because the UR physician was not licensed to practice medicine in Louisiana. The case was affirmed on appeal. Spikes v. Louisiana Commerce and Trade, 161 So.3d 755 (La. App. 3 Cir. 7/2/14)

Here, a Medical Services Reviewer, not the Medical Director or the Associate Medical Director rendered the decision for the denial of behavioral pain management. Therefore, since the review was not in accordance with the MTG statute, the WCJ did not consider the decisions/issues to be an appeal. The Third Circuit agreed with the WCJ and noted the standard of review was manifest error/clearly wrong. Interestingly, the WCJ found in favor of the defendant and denied the behavioral pain management program.

Guidry v. American Legion Hospital, 162 So.3d 728, (La. App. 3 Cir. 4/1/15)

The WCJ found that the Medical Director did not follow the particular guidelines applicable to specific treatment recommended by the claimant’s doctor. Employer argued that claimant cannot dictate under which Section approval or denial will be based. The employer also argued that even though the claimant’s doctor only recommended a single surgery, all aspects of the proposed surgery had to be appropriate. Here the WCJ found that under Section 2023, there are 13 different types of lumbar spinal surgeries, each with a different set of criteria that must be met in addition to the general criteria. Claimant argued the medical evidence submitted by Dr. McDonald met the Guideline’s requirements and delineated the evidence at trial. The Court did not seem to have used any new evidence or testimony, e.g. Dr. McDonald’s deposition or testimony by the claimant; only the documentation submitted by Dr. McDonald. The Third Circuit upheld the judgment of the WCJ under the “ fact intensive ” reasoning, so the review is manifest error – i.e. no reasonable basis to support the decision.

Prince v. Superior Energy Servs., L.L.C., 181 So.3d 961 (La. App. 3 Cir. 12/16/15), 2015728

The appellate Court found that the WCJ committed legal error in crediting the SMO and IME opinions, noting that initial treatment and particularly the initial MRI Ordered by the SMO, were contrary to the medical treatment guidelines. Conducting a de novo review, the Court concluded that the treating physicians’ recommendations were in accordance with the MTG and therefore entitled to greater weight. It ordered defendant to reinstate indemnity benefits and provide the medical treatment recommended by the treating physician, a $2,000 penalty for defendant’s denial of the second MRI, a $2,000 penalty for denial of a psych evaluation pending a discogram, and a $2,000 penalty for termination of TTD benefits, plus attorney fees of $6,000 through appeal.

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CASE Thomas v. Marsala Beverage Co., 179 So.3d 620 (La. App. 2 Cir. 9/30/15)

NOWABOUT

DESCRIPTION Claimant suffered a low back and neck injuries due to an undisputed work accident. His pain management physician recommended a lumbar epidural steroid injection (ESI). Defendant denied the treatment based on an SMO. The OWC Associate Medical Director concluded that treatment was contrary to the MTG. Claimant appealed to the WCJ and offered the newly taken deposition of the treating pain management physician. The WCJ reversed the denial of treatment. The Court of appeal affirmed, noting that the post1009 deposition of the pain management doctor “provided a straightforward, common sense, and cogent explanation for why the ESI treatment recommended by Dr. Forte was medically necessary.” The Court also stated: “We cannot help but note that, in this particular case, more than 18 months have now lapsed from the time the treatment was requested and the rendition of this opinion. Whether this is efficient and timely is certainly debatable.”

7.3 Do the Louisiana Guidelines apply to . . . ? The Louisiana Guidelines apply to all requests for medical treatment after the date of enactment regardless of the date of the accident. The Louisiana Guidelines are unclear as to whether they apply to prescription medications. The OWC has noticed a problem with prescriptions and the Louisiana Guidelines, but they have yet to fully address the issue. Some doctors may use 1010s for prescriptions, while some doctors may not. This confusion may appear to the claimant, and his/her attorney, as an employer or insurer refusing to approve the medications. Be prepared to react quickly to any problem so as to prevent the attorney from filing a 1008 to allege no or late authorization of medications.

7.4 Routine visits beyond the $750 limit 7.4.1 LWC-WC-1010 (the “1010”) Beginning June 20, 2014, a LWC-WC-1010 (the “1010”) is required to initiate the request for authorization of the first routine evaluation and management office visit that occurs beyond the statutory non-emergency medical care monetary limit of $750 per provider. If the visit is approved as medically necessary, a 1010 will not be required for any subsequent routine evaluation and management office visits with the employee’s treating physician within the first year of the accident date not to exceed 12 visits. Any routine evaluation and management office visit that occurred prior to the first submission of a 1010 form will count towards the 12 visits to occur within one (1) year of the accident date.

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7.4.2

New LWC-WC-1010 (the “1010”)

A new LWC-WC-1010 is required for a routine evaluation and management office visit after the 12th visit or after one (1) year from date of accident. If this 1010 is approved, then a new 1010 form will only be required every fourth (4th) routine evaluation and management office visit thereafter. A routine evaluation and management office visit is limited to new and established visits. Any medical care, services, or treatment performed at such a routine visit that will be billed as anything other than a routine evaluation and management office visit will require pre-approval with a request for authorization on a 1010. Nothing in these changes will prevent the carrier/self-insured employer from denying one of the 12 routine evaluation and management office visits to occur within the first year of the accident date for reasons other than medical necessity to include but not limited to: • • •

Causation; Compensability; and Medical relatedness.

After the first 12 routine evaluation and management office visits or after one (1) year from the date of accident, the carrier/self-insured employer may deny as not medically necessary any request for a routine evaluation and management office visit.

7.5 Payment of medical benefits 7.5.1 Deadlines Medical benefits must be paid within 60 days after receiving written notice, and 30 days after receiving electronic notice. While an employer may require a HCFA 1500/UB-92 before a bill is paid, the Courts have held that the 60 days is the time in which you have to obtain the necessary forms. Not having the proper forms is not an excuse. You must pay the bills. Remember that the penalty for not paying a bill on time (in addition to the cost of paying the bill) may be as high as $2,000 plus attorneys’ fees.

RELATED CASE LAW CASE

DESCRIPTION

Ellis v. Resource Transportation and National Loss Control Mgt, 10 So.3d 252 (La. App. 3 Cir. 3/4/09)

Employer/insurer claimed that the bills did not contain the proper Current Procedural Technology (CPT) codes or necessary medical records. The Court held that the employer/ insurer took no action to clarify the coding issue or request the medical records; award of penalties and attorneys’ fees.

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7.5.2

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Medical provider claims – outliers

Medical providers may bring suit seeking to recover late and/or underpaid medical bills, as well as penalties and attorneys’ fees associated with same. Such claims are timely so long as they are filed within three (3) years from the time of making the last payment of medical benefits on the underlying compensable claim. Because penalties and attorney fees can easily increase an award $4,000, we have seen a growing number of these claims for small alleged underpayments. For example, even if the original underpayment was $52, the settlement demand of the provider will typically be $4,052 and a common settlement amount is $2,052. As these claims typically require expert testimony or the testimony of a member of an employer’s or insurer’s billing team, these claims are often cost prohibitive to aggressively defend. Common reasons for underpayment include: • • •

Improper payment of hospital bills on an inpatient basis; Improperly paying under a contract with an insurer; and Other improper discounts.

Working closely with an employer’s or insurer’s billing department is the most efficient and best way to prevent and resolve these claims. 7.5.2(a) Seeking Outlier status Many of these medical provider claims involve providers seeking “outlier status” under the Louisiana Administrative Code (LAC) §2519. Under the LAC, reimbursement of inpatient hospital services is limited to the lesser of covered billed charges or the per diem amount. The per diem amounts are specifically outlined in the code, ranging from as little as $771 per day in one area, to as high as $2,059 per day in another. 7.5.2(b) A utomatic outliers “Automatic outliers” are those inpatient hospital acute care services falling within certain diagnostic code ranges (e.g., AIDS, Acute Myocardial Infarction and severe burns), which are reimbursed at covered billed charges less a 15% discount. Providers that appeal for this outlier status must present evidence that the case was atypical in nature due to the case actually causing unusually high charges when compared to the provider’s usual case mix. In addition, the claim may only be appealed for outlier status if the following general criteria are met: • • •

Total charges for an inpatient hospital surgical admit are greater than or equal to $100,000; Total charges for an inpatient hospital medical admit are greater than or equal to $75,000; Average per day charge for any one case (inpatient hospital, rehabilitation, SNF, etc.) equates to 1.75 times the applicable per diem rate.

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RELATED CASE LAW CASE

DESCRIPTION

Lakeview Regional Medical Center v. Washington Parish School Board, 152 So.3d 957 (La. App. 4 Cir. 7/17/14)

WCJ denied hospital’s request for outlier status. Employee was admitted to hospital following heart related problems (a pulmonary embolism) while undergoing an epidural steroid injection for a compensable work accident. At the Trial on the merits, the hospital submitted evidence for length of stay for all inpatients for year in question.

Crescent City Surgical Care Centre Facility, LLC v. Beverly Industries Inc., 162 So.3d 1254 (La. App. 4 Cir. 3/25/15)

WCJ denied hospital’s request for outlier status, finding specifically that the employee’s condition was neither acute nor of an emergency nature, as he had waited two (2) years to undergo the procedure. Moreover, employee’s orthopedist testified that the surgery did not involve any complications, and that the employee had a good result. Finally, the orthopedist also testified that the length of stay following the surgery was about average for this type of procedure.

WCJ found that the hospital was not entitled to outlier status, finding specifically that the treatment was not “ atypical in nature ” as required by statute. Affirmed on appeal.

Affirmed on appeal.

7.6 Choice of physician 7.6.1

The claimant has absolute right to choice of physician. There is also no “de facto” choice of doctor in Louisiana.

RELATED CASE LAW CASE

DESCRIPTION

Miller v. Christus St. Patrick Hospital, 100 So.3d 404 (La. App. 3 Cir. 10/24/12)

The Third Circuit addressed the issue of whether an employee has the right to choose his/her own physical therapist. The Third Circuit concluded that the employee does NOT have such right, opining that a physical therapist is not considered a physician, but instead, falls within the definition of a “ medical practitioner .”

Lamartiniere v. Boise Cascade Corp., 154 So.3d 814 (La. App. 3 Cir. 4/9/14)

WCJ allowed claimant to treat with a new pain management doctor, despite fact that prior pain management doctor discharged claimant for violating narcotics contract, where the records indicated that ongoing pain management was reasonable.

LeBlanc v. Wal-Mart Stores, Inc., 177 So.3d 1125 (La. App. 3 Cir. 11/4/15)

The appellate Court affirmed WCJ’s award of TTD benefits, medical benefits, penalties, and attorney fees. In response to employer’s contention that claimant had already had one choice of physician, the Court held that the employee’s signing a notice prior to seeing the employer’s doctor, acknowledging her right to choose her own doctor, did not make employer’s doctor her choice of physician.

The Court of Appeal affirmed, noting that regardless of illicit drug use, claimant’s first choice of pain management doctor was no longer available to him.

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7.6.2

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Relevancy of field or specialty

While the claimant has an absolute right to choice of physician, he/she is not allowed to choose a physician in a field or specialty that is irrelevant to the alleged injuries.

RELATED CASE LAW CASE Deloach v. FARA Ins. Servs., 154 So.3d 737 (La. App. 3 Cir. 12/10/14)

DESCRIPTION Claimant filed a Motion for seeking approval of treatment with a physical medical specialist. Claimant had suffered compensable work injury and was already treating with a neurologist and ophthalmologist. The employer offered records reflecting that alleged issues had essentially resolved. WCJ denied the Motion, finding that the claimant had offered nothing to show that the requested treatment with the physical medical specialist was necessary. Affirmed on appeal.

7.6.3

Emergency treatment

However, whenever an employee is sent for emergency treatment following an accident, that doctor is neither party’s choice under LSA-R.S. 23:1121(E).

RELATED CASE LAW CASE

DESCRIPTION

Greer v. Whole Foods Market, Inc., 135 So.3d 1184 (La. App. 4 Cir. 1/5/14)

Claimant sent to occupational clinic by his employer. Clinic then referred claimant to a physician, and claimant signed Choice of Physician (COP) form. Court concluded that the COP physician was both the employer’s and employee’s choice of physician, and thus struck down an SMO and IME saying claimant could return to work.

The LWC-WC-1121 (the “1121”) “choice of physician form” essentially locks the claimant into a specific provider barring evidence that the claimant was forced to sign the form or was unaware or ill-advised of the consequences of executing the form. The claimant must obtain prior approval from the employer or Workers’ Compensation insurer for a change in that field or specialty. 7.6.4 Pre-payment One problematic issue is whether an employer or insurer can be required to pre-pay for doctor’s visit. In Louisiana, the failure to pre-pay is considered a failure to pay for the medical treatment.

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RELATED CASE LAW CASE

DESCRIPTION

Authement v. Shappert Engineering, 840 So.2d 1181 (La. 2003)

The Louisiana Supreme Court stated that if the failure to provide pre-payment results in the claimant not receiving medical treatment, penalties and attorneys’ fees for failure to provide treatment may be awarded.

7.7 Choice of pharmacy 7.7.1

Some courts have found that the employer has the right of choice of pharmacy under LSA-R.S. 23:1203(A). The injured employee may file a Motion to change pharmacy in the event that prescriptions are not being provided within a reasonable timeframe.

RELATED CASE LAW CASE

DESCRIPTION

Downs v. Chateau Living Center, 167 So.3d 475 (La. App. 5 Cir. 1/28/15)

Appellate Court reversed the trial Court’s ruling, finding that the employer has the right to choose the pharmacy to be used by an injured employee receiving medical benefits.

Bordelon v. Lafayette Consolidated Gov’t, 149 So.3d 421 (La. App. 3 Cir. 10/1/14)

Appellate Court affirmed WCJ’s ruling that the employer’s choice of pharmacy was reasonable. In this matter, the claimant had been receiving his prescriptions via mail through IWP, when the employer issued the claimant a prescription card to use in obtaining his medications through CVS/Caremark.

In this matter, the claimant attempted to switch to Injured Workers Pharmacy (IWP) to receive her prescriptions, reasoning that she needed to switch to home delivery because she was dissatisfied with prior doctors and feeling frustrated and depressed. At trial, the employer introduced evidence showing that the claimant could have filled her prescriptions through mail order with the employer’s chosen pharmacy, and evidence that she never attempted to do same with the employer choice of pharmacy.

The trial Court granted the employer’s Motion for Summary Judgment (MSJ), finding that the employer, not the claimant, has choice of pharmacy, but noting that the claimant could file a Motion to change pharmacy in the event that he did not receive his prescriptions within a reasonable timeframe. Naron v. LIGA, 175 So. 3d 475 (La. App. 2 Cir. 9/9/15),

The Court rejected jurisprudence from other circuits stating that the employer has the choice of pharmacy, citing its prior decision in Brown vs. KTBS (employee had right to select vendor for wheelchair). However, the Court concluded that IWP was an out-of-state provider. Pursuant to LSA–R.S. 23:1203, an employee may use an out-of-state provider only if the services are provided at comparable costs charged by in-state providers. The Court noted that IWP had charged $559.62 for the same prescription which had previously been dispensed by an in-state pharmacy for $39.88.

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CASE

DESCRIPTION

Lafayette Bone & Joint Clinic v. Guy Hopkins Const. Co., 177 So.3d 142 (La. App. 3 Cir. 10/21/15),

The carrier notified the treating physician that it would no longer reimburse him for medication he dispensed to the employee, and asked that he direct the employee to a retail pharmacy. At the time, the company had already paid more than $750 to the provider. The carrier’s Pharmacy Benefit Management (PBM) sent a prescription card to all of the company’s claimants “ suggesting but not requiring ” that they use the card. The PBM did not notify the employee that it would no longer pay for physician-dispensed medications. The Court held that because the carrier had already paid and thus authorized treatment over $750, it could not rescind the authorization.

7.7.2

Caps for unapproved non-emergency treatment

In addition to choice of pharmacy, pharmacy bills for unapproved, nonemergency treatment are subject to the $750 cap under LSA-R.S. 23:1142.

RELATED CASE LAW CASE Rebel Distributors Corp., Inc., 137 So.3d 91 (La. App. 3 Cir. 4/2/14)

DESCRIPTION Appellate Court affirmed trial Court’s ruling that unapproved, nonemergency prescription medication is subject to the $750 cap.

7.8 Second medical opinion (SMO) A second medical opinion (SMO) may be requested despite Guidelines to provide support for your position on medical treatment, necessity, compliance, etc. The law now recognizes a Motion to Compel SMO and also recognizes suspension of benefits and for no-show fees should the claimant not appear for the visit without having to file suit.

7.9 Independent medical examination (IME) A court independent medical examination (IME) can be appointed if there is a dispute on either: • •

Disputes as to the employee’s condition (including causation); or Work status.

An IME’s report is considered prima facie evidence of facts stated in the report to the director/Court.

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RELATED CASE LAW CASE

DESCRIPTION

Gabriel v. Delta Airlines, Inc., 106 So.3d 1285 (La. App. 5 Cir. 1/30/13)

The Fifth Circuit Court of Appeal found while LSA-R.S. 23:1123 permits the OWC to appoint a physician to perform an IME, the law does not require the OWC to accept the IME conclusions. However, the conclusions should be given significant weight as the IME is an objective party.

Sparnecht v. Amar Oil Company, 93 So.3d 725 (La. App. 1 Cir. 6/1/2012)

The Court found that a request for an IME does not require two (2) doctors of the same specialty to have differing opinions before an IME can be ordered.

7.10 What if a claimant does not follow-up with treatment? Claimants are failing to obtain treatment with an increasing frequency. When a claimant stops going to the doctor, as an employer you should schedule an SMO and have the doctor address whether or not treatment is still needed and if the claimant has any work restrictions. You may then reduce or terminate benefits as indicated by the SMO physician (following the 1002 process).

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8.1 AFFIRMATIVE DEFENSES 8.2 FRAUD 8.3 DEVELOPING A FRAUD CASE 8.4 OTHER AFFIRMATIVE DEFENSES 8.5 SECOND INJURY FUND (SIF)

8. Affirmative defenses and the Second Injury Fund (SIF)

8.

Affirmative defenses and the Second Injury Fund (SIF)

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8. Affirmative defenses and the Second Injury Fund (SIF) An employer must have a written and published drug and alcohol policy. Benefits above and beyond those that are necessary to medically stabilize an injured employee are not owed to an employee who is injured while intoxicated, but the rules regarding compliance with the statute require absolute compliance.

8.1 Affirmative defenses 8.1.1 What the law states – Intoxication Defense LSA-R.S. 23:1081 – The Intoxication Defense LSA-R.S.23:1081 provides that benefits are not owed to an employee who is injured while intoxicated. Intoxication under the statute includes alcohol intoxication and being under the influence of illegal drugs, and prescription medication abuse. The rules regarding compliance with the statute, the chain of custody issues, etc. require absolute compliance. Failure to follow one of these rules is the easiest way for a claimant to challenge the intoxication defense. 8.1.2

Drug and alcohol policy and presumed intoxication

In order to assert an intoxication defense, the employer must have a written and published drug and alcohol policy.

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With that policy, an employee can be presumed intoxicated under two (2) circumstances: 8.1.2(a) Illegal drugs, including prescription medication Illegal drugs [which will include prescription medication under LSA-R.S. 23:1081(5)] If there is evidence of illegal drug use (controlled substances) at the time of the accident, on or off the job, the employee is presumed intoxicated; however, for marijuana, test results must show at least 50 nanograms/ml to exclude the possibility of passive inhaling. If the employee refuses to submit to testing, he/she is presumed intoxicated at time of the accident under LSA-R.S. 23:1081(7)(a). 8.1.2(b) Alcohol The employee’s blood alcohol content determines the presumption of intoxication: • •

If employee’s blood alcohol content is 0.08 or more at time of accident, he/she is presumed intoxicated. If employee’s blood alcohol content is between 0.05 and lower than 0.08, there is no presumption, although the level of alcohol in his/her blood can be used with other evidence (slurred speech) to prove intoxication. If employee’s blood alcohol content is 0.05 or less, he/she is presumed not to be intoxicated.

RELATED CASE LAW CASE Cordon v. Parish Glass of St. Tammany, Inc., 174 So.3d 1158 (La. App. 1 Cir. 12/23/14)

DESCRIPTION WCJ denied the claim for intoxication. Claimant was seriously injured when a load of mirrors fell on him at work. A drug screen immediately following the accident indicated the presence of prescription drugs and marijuana in claimant’s bloodstream. The WCJ found that claimant failed to overcome the presumption of intoxication, denied his claim, and ordered him to reimburse defendants some $300,000, including $10,000 in attorney fees. The Court of appeal affirmed, noting that “ it is not necessary for an employee to be intoxicated to the point of helplessness in order to be deprived of compensation ” under LSA-R.S. 23:1081. The Court did reduce the amount of reimbursement by the costs of emergency medical care, and remanded the case for calculation thereof.

Prine v. Coastal Bridge Co., LLC, 157 So.2d 732 (La. App. 1 Cir. 10/29/14)

Court found the claimant rebutted the presumption. The claimant allegedly injured his back at work and was taken by the employer to a clinic for drug testing per company policy. The claimant refused to provide a urine specimen before seeing a physician, and the clinic’s receptionist notified the employer of the employee’s refusal. In response, the employer immediately fired the employee for refusing the drug screen. The WCJ found the claimant rebutted the presumption because he submitted to a drug screen several hours later at the ER (which came back negative), and there was no evidence that the drug screen was tampered with. The WCJ also found the testimony of the employer wholly unbelievable, and assessed the defendants with a $3,000 fine under LSA-R.S. 23:1208.

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CASE Joseph v. Georgia Pac., L.L.C., 182 So.3d 163 (La. App. 1 Cir. 9/18/15), 2015-0227

NOWABOUT

DESCRIPTION Employee died in an unwitnessed accident. Lab work was positive for marijuana, with THC levels of 1.3 ng/ml, triggering the statutory presumption. The employee’s surviving children filed a disputed claim for death benefits. The employer responded with a Motion to Summary Judgment (MSJ) asserting intoxication. In opposition to the MSJ, the survivors offered deposition testimony from co-workers indicating that the decedent did not appear intoxicated prior to the accident. The WCJ granted the Motion. The Court of appeal reversed. Recognizing the presumption of intoxication, the Court concluded that in light of the co-employee depositions, there were genuine issues of material fact as to whether the decedent was intoxicated and whether the intoxication caused his accident.

8.1.2(c) Presumption of intoxication If the employee can show that his/her accident would have occurred regardless of the intoxication, he/she can overcome this affirmative defense.

8.1.3

Emergency care obligations

Regardless of whether an employee is intoxicated or not, the employer is responsible for the reasonable medical care provided the worker until such time as he/she is “stabilized” and “ready for discharge from the acute care facility.”

8.2 Fraud Fraud is costly to both employers and insurers. Fraud is also very risky for claimants. If an employer or insurer is successful in proving fraud, the claimant loses his/her rights to all compensation benefits. In developing a fraud case, you can never have enough evidence. A clear connection needs to exist between misrepresentations and the claim for benefits.

8.2.1 What the law states – Intentional misrepresentation LSA-R.S. 23:1208 – (Intentional Misrepresentation) Requirements The law requires three (3) elements for fraud under 23:1208: (1) false statement, (2) made willfully and deliberately and (3) made to obtain or defeat payment of benefits.

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Examples include: • • • • • •

Prior injuries or prior medical treatment denied or not disclosed to the doctor. An alteration of medical records. Prior and subsequent accidents denied. Drug seeking behavior. Misrepresentation of identity. Subsequent employment/earnings not disclosed.

If you are successful in proving fraud, the claimant will lose all rights to all compensation benefits. In especially egregious cases, the Court may award restitution until the date you discover the fraud.

FRAUD EXAMPLES

PRIOR INJURIES OR PRIOR MEDICAL TREATMENT DENIED OR NOT DISCLOSED TO THE DOCTOR

DRUG SEEKING BEHAVIOR

ALTERATION OF MEDICAL RECORDS

MISREPRESENTATION OF IDENTITY

PRIOR AND SUBSEQUENT ACCIDENTS DENIED

SUBSEQUENT EMPLOYMENT/ EARNINGS NOT DISCLOSED

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8.2.2 What the law states – Failure to disclose medical history LSA-R.S. 23:1208.1 (Failure to Disclose Medical History Requirements) Requirements This form of fraud applies to the employee’s failure to fully disclose their medical history on an employer-presented Medical Questionnaire. Such a form must contain the warning, in bold and not less than 10 point font, that failure to truthfully answer the questions may result in claimant’s forfeiture of Workers’ Compensation benefits under LSA-R.S. 23:1208.1. And there is a requirement that the employer is prejudiced by the misinterpretation. [Guidry v. Louisiana Scrap Metal Recycling, WCA 16-864 (3rd Cir. 2016)]

RELATED CASE LAW CASE

DESCRIPTION

Lavalais v. Gilchrist Construction, 158 So. 3rd 195 (3rd Cir. 2015)

Requires that the subsequent injury was inevitable or very likely to occur because of pre-existing condition, and is not based on mere anatomical connexity.

8.3 Developing a fraud case First, there can never, ever be enough evidence of fraud in a fraud case. If you find one thing, you should begin to look for more evidence. Look for evidence by examining:

q • • • • • • • •

Thorough Recorded Statements Ask the injured worker if he/she feels capable of giving a statement. Explain that he/she should ask you to repeat/rephrase or question if he/she does not understand. Confirm no language barriers. Retain the actual tape and maintain a proper chain of custody of the tape. Obtain statements as soon as possible after an accident. Discuss prior accidents and injuries and medical treatment (MRIs, X-Rays, CT Scans, etc.). Discuss work history, earnings, job duties, separation from employment, etc. Ask questions about pharmacies used, primary care physicians, visits to hospitals, etc. Repeat questions about prior accidents and similar treatments unless the answers are clear and unambiguous.

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q

Civil and Criminal Background Reports and Index Searches

Civil and criminal background reports and index searches reveal: • • •

Prior and subsequent accidents Questionable identity issues Criminal history

Be sure to repeat periodically and prior to trial.

q •

q

1025-EE The 1025-EE contains language prohibiting misrepresentations – language can be used to support, for example, that an injured employee knew he/she was lying if he/she failed to report other employment.

Review the Medical Records

Medical records are a good place to look for: • • • •

q • • •

Drug-seeking behavior – multiple refills, multiple complaints of losing medications, asking for a specific medication by name, etc. Prior and subsequent accidents and medical treatment – e.g., local hospital records often contain useful information. History of your subject’s accident – e.g, look for changes in the story or new body parts being added or no longer discussed. Initial patient questionnaire – e.g., look for questions related to prior surgeries or prior similar problems. You may have to request this specifically from the providers. Not all provide it automatically. Pharmacy records – Will show other physicians, drug seeking pattern recognition, etc.

Surveillance Surveillance should be combined with additional evidence if possible (e.g., statements, depositions, etc). Consider obtaining employment records if the claimant is observed working. Surveillance should include witness identification.

Surveillance is best performed when the claimant has described – in depositions, medical records, etc. – specific things he/she can or cannot do. You would want surveillance of the claimant doing what he/she is telling the doctor he/she cannot do.

q • • •

q • •

Online Searches Run a search on Facebook, Pinterest, Google, Twitter, Instagram, etc. Be sure to print color copies of what you find interesting. The employee may remove it later, and these online records are almost impossible to obtain. Some investigators have access to programs that conduct a greater search than regular online searches – identify and use them.

Excellent Deposition Testimony (once in litigation) Testimony is essential in virtually every fraud case. Testimony is usually obtained prior to fraud being uncovered so it must be thorough.

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q • •

Reach Out to the Insured The insured may have information on the claimant that can be used. Always ask the insured if the claimant mentioned other potential accident causes, whether the claimant has any physical hobbies, etc.

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Mileage Fraud Run a MapQuest/Google Maps search to measure distances. Compare to dates of treatments to mileage records.

Employers or insurers should not tip its hand too early when a fraud case is believed to exist. Employers or insurers need to resist the urge to deny benefits at the first sign of fraud. As an employer or insurer, if you think you have enough evidence of fraud, think again. Since Courts are always hesitant to deny a claim for fraud, you can never have too much evidence of fraud.

RELATED CASE LAW CASE

DESCRIPTION

Malone-Watson v. Strategic Restaurants, 176 So.3d 417 (La. App. 1 Cir. 6/11/15)

Court dismissed the claim for 1208 fraud. Claimant alleged injuries to her left ankle, both knees, back, hip, and muscle in the left arm as a result of alleged trip and fall over a bread tray at work. The Defendants filed a Motion for Summary Judgment (MSJ) alleging fraud which was granted by the WCJ and upheld on Appeal. In support of the MSJ, Defendants attached video surveillance and the claimant’s deposition testimony. The surveillance video showed the claimant going about her daily life and performing a wide range of activities that she denied she could perform, including: driving a car, walking without assistance, bending from the waist, and the regular use of her left arm, hand, and knees. This video was coupled with her deposition testimony, wherein she testified repeatedly about the severity of her condition, the physical limitations she suffered, and the high level of pain she experienced.

Johnson v. St. Francis Nursing & Rehab. Ctr., 155 So.3d 689 (La. App. 3 Cir. 12/23/14)

Appellate Court affirmed the WCJ’s denial of employer’s 1208 fraud defense, concluding that claimant’s underperformance on an Functional Capacity Evaluation (FCE), even assuming that it was a “ statement ” or “ representation ” at all, did not amount to a willful misrepresentation for purposes of 1208 fraud.

Shropshire v. Anco Installation, 168 So.3d 601 (La. App. 1 Cir. 12/23/14)

The trial Court dismissed the claim for 1208 fraud. Claimant entered into a full and final settlement agreement with the employer and insurer. The Order signed by the Judge included language that said the claimant was to receive $5,381 per month for 26 years to settle the future medical aspect of the claim. Other documents in the settlement package reflected that the payment was to be $5,381 per year. The monies were not paid and the claimant filed a 1008 seeking the monthly payments. The Defendants answered and stated that the payments were to be yearly, and they requested that the Order be amended to reflect same. At the hearing, the trial Court found the payments per month language was a typographical error, and that the claimant made false statements for the purpose of obtaining benefits in violation of LSA-R.S. 23:1208. Claimant testified to a “side” agreement to make payments monthly as well as annually in the settlement negotiations. The trial found that the claimant fabricated the story for the sole purpose of obtaining additional benefits.

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CASE Morris v. Textron Marine & Land Sys., Inc., 155 So.3d 21 (La. App. 1 Cir. 9/24/14)

DESCRIPTION The trial Court granted employer’s MSJ based upon 1208 fraud. Claimant filed a dispute arising from a 2010 work accident. He denied any prior or subsequent accidents. Employer learned during discovery that claimant was involved in a 1996 work accident, a 1997 auto/work accident, and a 2012 auto accident. The WCJ granted the employer’s MSJ, noting in her written reasons that, “ Forgetting some events is quite possible due to the passage of time. Denying all prior work accidents and automobile-related injuries and settlement of claims for money is more than just forgetting .” The Court of appeal affirmed, rejecting claimant’s assertion that taking a Lortab the morning of his deposition explained the erroneous testimony.

Borders v. Boggs & Poole Contracting Grp., Inc., 147 So.3d 308 (La. App. 2 Cir. 8/13/14)

The trial Court denied the claim based on fraud. Claimant allegedly injured his knee and back in a work accident. At trial, defendant offered surveillance video showing the claimant lifting a small boat, fishing, and performing numerous other activities well beyond the physical capacity he reported to his doctors.

Phillips v. Sanderson Farms, Inc., 136 So.3d 27 (La. App. 1 Cir. 11/1/13)

Claimant severed the tip of his finger while cleaning a meat grinder while in course and scope of his employment. Defendants denied the claim stating that the claimant intentionally injured himself.

Desadier v. W. Frasier, Inc., 122 So.3d 584 (La. App. 2 Cir. 8/7/13)

Claim dismissed for 1208 fraud. Claimant allegedly injured shoulder while attempting to dislodge a piece of lumber at work. Claimant denied any previous shoulder injuries. At trial, defendants introduced medical records showing multiple accidents and complaints of shoulder pain for several years leading up to the alleged work accident. Claimant had received multiple injections and MRIs for the shoulder.

The appellate Court held that the trial Court was not clearly wrong in finding that the claimant had committed fraud, dismissing his claim and sanctioning him accordingly. [Note that the claimant was arrested on criminal charges of Workers’ Compensation fraud while the appeal was pending].

Court found that the defendants failed to meet their burden of proving an intentional injury, and thus they were assessed with penalties and attorneys’ fees.

Court found it “ inconceivable ” that he forgot about the previous injuries and treatment.

8.4 Other affirmative defenses There are other incidents that require an affirmative defense. For example: • • •

Willful intent to injure himself/herself or another. A dispute with another person or employee over matters unrelated to the injured employee’s employment. Horseplay.

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8.5 Second Injury Fund (SIF) The Louisiana Second Injury Fund (SIF) is an important avenue for potential reimbursement of some Workers’ Compensation benefits paid under certain circumstances. The Louisiana legislature recognized a problem for handicapped workers seeking employment. Under the Workers’ Compensation scheme, a worker with an existing handicap at the time he/she applies for employment would be less desirable to a potential employer since the potential employer knows that if the prospective employee suffers a further related handicap, the employer will be responsible for the payment of Workers’ Compensation benefits. For example, if an applicant was blind in one eye at the time of the application for employment, the employer might be understandably concerned that a work-related accident that results in blindness to the remaining good eye would cause the employee to be blind and thus totally and permanently disabled. The employer would then face an award for the schedule loss of one eye and an award for permanent total disability. As such, the employer would under these circumstances tend to hire a similarly qualified worker with two (2) good eyes simply to avoid this potential exposure. In an effort to remedy this quandary for the employer and obstacle to employment for the injured worker, Louisiana (and many other jurisdictions) created the Second Injury Fund (SIF). The best explanation for the purpose of the fund is contained in the Act itself: It is the purpose of this part to encourage the employment of physically handicapped employees who have a permanent, partial disability by protecting employers and insurers from excess liability for Workmen’s Compensation for disability when a subsequent injury to such an employee merges with his [or her] pre-existing permanent physical disability to cause a greater disability than would have resulted from the subsequent injury alone. The method of accomplishing this objective chosen by the Louisiana legislature is a reimbursement of the employer or insurer by the fund under the conditions subsequently outlined, after the employee has been paid the applicable compensation under the Act for the greater disability which resulted from the merger of the previous condition and the work-related injury. Thus, the SIF provides that an employer or insurer is entitled to reimbursement for compensation already paid. 8.5.1

Basis for recovery from the SIF

In Order to be eligible for reimbursement by the Louisiana SIF, the employer must establish certain criteria. 8.5.1(a) Pre-employment Permanent Partial Disability (PPD) The employee must have a “permanent partial disability” (PPD) as defined by LSA-R.S. 23:1378(F) as “any permanent condition, whether congenital or due to injury or disease, of such seriousness as to constitute a hindrance or obstacle to obtaining employment or to obtaining reemployment if the employee should become unemployed.” If the PPD is not one of the PPDs specifically enumerated under the statute (list below), then the employer will be required to show that accommodations were made for the employee at the outset

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of the employment. This is accomplished via an affidavit from the employee’s supervisor attesting to the accommodations made for the employee due to the PPD. 8.5.1(b) Knowledge It must be clearly established that the employer had actual knowledge of the employee’s preexisting permanent partial disability prior to the subsequent injury. [LSA-R.S. 23: 1378(A)(4)] A preemployment physical and accompanying report may serve this purpose; however, employer’s inquiries regarding pre-existing conditions are somewhat limited by the Americans With Disabilities Act. The Act provides for a presumption that the employer considered the condition to be permanent or likely to be an obstacle to employment if the condition is any of the following: • • • • • • • • • • • • • •

Epilepsy Diabetes Cardiac disease Arthritis Amputated foot, leg, arm, or hand or total loss of use thereof Hemophilia Chronic osteomyelitis Ankylosis of joints Hyperinsulinism Muscular dystrophy or arteriosclerosis Hodgkin’s disease or brain damage A spinal fusion or the surgical removal of an intervertebral disc Mental retardation, under certain circumstances enumerated in the Act Residual disability from poliomyelitis

• • • • • • • • • • •

Cerebral palsy Multiple sclerosis or Parkinson’s disease Cerebral vascular accident Tuberculosis Silicosis Thrombophlebitis or Varicose veins Heavy metal poisoning Ionizing radiation injury Compressed air sequelae Ruptured intervertebral disc Psychoneurotic disability following treatment in a recognized medical or mental institution Loss of sight of one or both eyes or a partial loss of uncorrected vision of more than seventy-five percent bilaterally

The way to satisfy this portion of the statute is by way of a post-hire medical history questionnaire. The SIF strongly recommends that employers use the form promulgated by the Workforce Commission. In addition to having the employee fill out this document upon hire, the employer is advised to designate a supervisor with hire and fire authority to review the document with the employee, as well as sign the document evidencing the discussion. This is to take place as soon as the document is filled out post-hire, so that there can be no question that the employer was fully aware of the PPD from the outset of the employment. If the injured worker was an employee with the same company for the first accident as well as the second, there is a form provided by the SIF that has to be completed by a supervisor of the employee with hire and fire authority. This document is in the form of an affidavit, and it must be notarized.

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8.5.1(c) Subsequent injury and “merger” The employee must incur a subsequent injury (arising out of and in the course and scope of employment) resulting in liability due to the “merger” of the subsequent injury with the pre-existing permanent partial disability. LSA-R.S. 23:1371 provides that the “merger” requirement is met if: • •

The subsequent injury would not have occurred but for the pre-existing permanent partial disability; or The disability resulting from the subsequent injury in conjunction with the pre-existing permanent partial disability is materially and substantially greater than that which would have resulted had the pre-existing permanent partial disability not been present, and the employer has been required to pay and has paid compensation for the greater disability.

If the employer or carrier cannot demonstrate a causal link between the pre-existing condition and the second injury, then no “merger” has been demonstrated and there can be no recovery from the SIF. This portion of the statute is satisfied via medical evidence, whether medical records, an affidavit from the physician, a deposition of the physician, or a combination of all three. 8.5.2 Amount of reimbursement The amount of reimbursement to an employer is governed by several factors. For example: 8.5.2(a)

Reimbursement only

The employer is first required to pay the appropriate compensation to the employee for the combined result of the pre-existing condition and the subsequent injury. 8.5.2(b)

Indemnity benefits

For all accidents occurring on or after July 1, 2010, reimbursement is available from the SIF “ for all weekly compensation payments payable after the first 104 weeks of payments.” LSA-R.S. 23: 1378(A). 8.5.2(c)

Medical benefits

For all accidents occurring on or after July 1, 2010, reimbursement is available from the SIF for 100% of all reasonable and necessary medical expenses paid which exceed $25,000. 8.5.2(d)

Lump-sum settlements

Lump-sum settlements are reimbursable. The SIF Board must approve the settlement amount prior to submission of the settlement documents to the Judge, and the SIF Board retains the right to pay such reimbursement in installments. Note that only amounts reimbursable by the SIF will be reimbursed. 8.5.3 Time limit to seek reimbursement In order to be entitled to this reimbursement, the employer or insurer must notify the SIF Board within one (1) year after the first payment of compensation benefits, and furnish information to support the claim. LSA-R.S. 23:1378(B). If the claim is ultimately denied by the SIF Board, then an th appeal can be timely sought by filing a Petition in the 19 Judicial District Court in Baton Rouge, wherein the denial can be litigated and formal discovery can occur. NOTE: Insurer has 30 days from the date of formal denial by the SIF Board to file a petition in district Court.

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The SIF will often communicate with the WC insurer, requesting information not yet received, before it recommends denial of a claim. The correspondence from the SIF will request items such as: • •

An affidavit from the employer discussing the knowledge element; and Medical records evidencing the merger of the two (2) injuries.

Specifically, if a claim is timely received by the SIF, the PPD and “knowledge elements” are determined within 120 days of receipt. If the claim is timely filed, and both the PPD and “knowledge elements” are proven within the 120 days of filing, then additional time is given to perfect the merger element (generally up to one [1] year).

RELATED CASE LAW CASE National Fire Union Insurance Company v. State of Louisiana SIF Board, 168 So.2d 585 (La. App. 1 Cir. 12/23/14)

DESCRIPTION SIF board denied the claim for reimbursement and the compensation insurer filed a Motion for Summary Judgment (MSJ). Trial Court Judge granted the MSJ for the WC insurer and the Court of Appeal affirmed. The Court found that the compensation insurer satisfied all three (3) elements under the statute entitling it to reimbursement: 1.

Employee was suffering from a permanent partial disability (PPD) – compensation insurer submitted evidence (affidavit of employee’s treating orthopedic surgeon) which stated that the initial injury resulted in a PPD which limited the function of the employee’s shoulder and restricted his abilities to perform his work duties.

2.

Employer knowledge of the PPD – Employee suffered the first injury while working for the same employer, and deposition testimony indicated that the employer knew of the injuries from the initial accident and accommodated his injury.

3.

Merger of the PPD and subsequent injury – Medical evidence submitted from orthopedist (affidavit) stated that the employee’s prior injury merged with his subsequent injury.

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9. What are penalties and attorneys’ fees?

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What are penalties and attorneys’ fees?

9.1 WHAT THE LAW STATES – PENALTIES AND ATTORNEYS’ FEES 9.2 IMPOSITION OF PENALTIES 9.3 COMMON PENALTY ACTIONS 9.4 MULTIPLE PENALTIES 9.5 THE PENALTY “CAP” 9.6 DEFENSES TO PENALTIES 9.7 ATTORNEYS’ FEES

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9. What are penalties and attorneys’ fees? Penalty provisions are imposed by the Court to discourage undesirable conduct, but the actual imposition of penalties and attorneys’ fees is not automatic.

9.1 What the law states – Penalties and attorneys’ fees Statutes address penalties in several circumstances: When an employer fails to pay Workers’ Compensation benefits. When an employer discontinues Workers’ Compensation benefits. When the non-prevailing party fails to pay a final judgment.

• • •

LSA-R.S. 23:1201(F) – When an Employer Fails to Pay Workers’ Compensation Benefits Except as otherwise provided in this Chapter, failure to provide payment in accordance with this Section or failure to consent to the employee’s request to select a treating physician or change physicians when such consent is required by LSA-R.S. 23:1121 shall result in the assessment of a penalty: • •

In an amount up to the greater of 12 percent of any unpaid compensation or medical benefits, or $50 per calendar day for each day in which any and all compensation or medical benefits remain unpaid or such consent is withheld, together with reasonable attorney fees for each disputed claim; However, the $50 per calendar day penalty shall not exceed a maximum of $2,000 in the aggregate for any claim.

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• •

The maximum amount of penalties which may be imposed at a hearing on the merits regardless of the number of penalties which might be imposed under this Section is $8,000. An award of penalties and attorney fees at any hearing on the merits shall be res judicata as to any and all claims for which penalties may be imposed under this Section which precedes the date of the hearing. Penalties shall be assessed in the following manner: (1) Such penalty and attorney fees shall be assessed against either the employer or the insurer, depending upon fault. No Workers’ Compensation insurance policy shall provide that these sums shall be paid by the insurer if the Workers’ Compensation Judge (WCJ) determines that the penalty and attorney fees are to be paid by the employer rather than the insurer. (2) This Subsection shall not apply if the claim is reasonably controverted or if such nonpayment results from conditions over which the employer or insurer had no control. (3) Except as provided in Paragraph (4) of this Subsection, any additional compensation paid by the employer or insurer pursuant to this Section shall be paid directly to the employee. (4) In the event that the health care provider prevails on a claim for payment of his fee, penalties as provided in this Section and reasonable attorney fees based upon actual hours worked may be awarded and paid directly to the health care provider. This Subsection shall not be construed to provide for recovery of more than one (1) penalty or attorney fee.

LSA-R.S. 23:1201(I) – When an Employer Discontinues Workers’ Compensation Benefits Any employer or insurer who at any time discontinues payment of claims due and arising under this Chapter, when such discontinuance is found to be arbitrary, capricious, or without probable cause, shall be subject to the payment of a penalty not to exceed $8,000 and a reasonable attorney fee for the prosecution and collection of such claims. The provisions as set forth in LSA-R.S. 23:1141 limiting the amount of attorney fees shall not apply to cases where the employer or insurer is found liable for attorney fees under this Section. The provisions as set forth in LSA-R.S. 22:1892(C) shall be applicable to claims arising under this Chapter.

LSA-R.S. 23:1201(G) – When the Party Fails to Pay the Judgment If any award payable under the terms of a final, nonappealable judgment is not paid within 30 days after it becomes due, there shall be added to such award an: • •

Amount equal to 24 percent thereof or $100 per day Together with reasonable attorney fees, for each calendar day after 30 days it remains unpaid, whichever is greater.

Payment shall be paid at the same time as, and in addition to, such award, unless such nonpayment results from conditions over which the employer had no control. No amount paid as a penalty under this Subsection shall be included in any formula utilized to establish premium rates for Workers’ Compensation insurance. The total $100 per calendar day penalty provided for in this Subsection shall not exceed $3,000 in the aggregate.

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9.2 Imposition of penalties Penalty provisions are imposed to discourage undesirable conduct, but the actual imposition of penalties and attorneys’ fees is not automatic. For almost all penalty and attorneys’ fees, the Trial Court will look at what information the employer or insurer had when the decision was made; and the Court will use this to determine if actions were reasonable.

RELATED CASE LAW CASE Davis v. Boise Cascade Company, 149 So.3d 331 (La. App. 3 Cir. 10/2/14)

DESCRIPTION Court awarded $10,000 in penalties and $15,500 in attorney fees. The penalties were awarded as follows: •

• •

Turner v. Lexington House, 176 So.3d 1071 (La. App. 3 Cir. 4/15/15).

Marshall v. Town of Winnsboro, 184 So.3d 796 (La. App. 2 Cir. 11/25/15)

$2,000 for failure to properly calculate TTD – employer failed to use the four (4) full weeks prior to accident, coupled with its failure to multiply the OT hours; $4,000 penalty for discontinuance of TTD; Two (2) $2,000 penalties for failure to timely authorize medical treatment – request for a discogram and request for lumbar surgery.

Employee’s doctor approved a nurse aid training instructor position. After speaking to the employee, he withdrew his approval. Three (3) days after the doctor withdrew his approval, indemnity benefits were terminated stating that the withdrawal did not change anything. The Court noted that there was no objective reason for terminating the benefits at the time of the termination and affirmed a $4,000 penalty. Employee and witnesses identified an actual and identifiable event which aggravated a pre-existing condition. The treating doctor disabled the employee from work. The adjuster responded with additional questions regarding the work restriction. These questions went unanswered and the claim was denied on the grounds that more information was needed. The Court found that the employer failed to conduct a reasonable investigation prior to denying the claim and that the need for more information was not a reasonable basis for the denial.

Conner v. Bridgefield Cas. Ins. Co., 185 So.3d 754 (La. App. 3 Cir. 12/9/15), 2015-621

Claimant slipped and fell at work. The WCJ awarded: • • •

SEB at zero (0) earning capacity, Plus $23,000 in attorney fees, $8,000 in penalties for multiple denials of mileage, and

$2,247.25 in expe nses.

In affirming the award, the Court of appeal rejected the defendant’s contention that statutory attorney fees were only due on the issues for which penalties were assessed (mileage). It did find that the WCJ erred in awarding costs expended by claimant’s attorney for telephone calls, photocopies, postage, travel, and for the conference with claimant’s doctor, and reduced the cost from $2,247.25 to $419.26. However, it awarded an additional $5,000 in attorney fees for work performed by claimant’s attorney on appeal.

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CASE McCombs v. G.L. Jones Const., Inc., 176 So.3d 1033 (La. App. 2 Cir. 1/14/15)

DESCRIPTION The WCJ found that the employer failed to authorize treatment with a physician of claimant’s choice, and awarded such treatment. In addition, recognizing that claimant had not specifically requested statutory penalties/attorney fees, the Court nevertheless awarded such benefits, citing jurisprudence that Courts should “ferret out” such claim when appropriate. The employer appealed the penalty/attorney fee award. The Second Circuit reversed that portion of the judgment, citing La. C.C.P. art. 861’s requirement that items of special damage must be specifically plead.

9.3 Common penalty actions These are some of the more commonly encountered penalty claims. However, many of the commonly encountered penalties are broad enough to be applied to other situations than those discussed below. 9.3.1

Improper calculation of Average Weekly Wage (AWW) – LSA-R.S. 23:1201(F)

Assuming you follow the new “1002 process” under LSA-R.S. 23:1201.1, and you do not follow the Court’s recommendations, improperly calculating the Average Weekly Wage (AWW) could give rise to a penalty of $50 per day until corrected up to a maximum of $2,000. Additionally improper calculation of the AWW results in an underpayment of indemnity benefits. 9.3.2 Underpayment of indemnity benefits – LSA-R.S. 23:1201(F) Underpaying indemnity benefits could also result in a penalty of $50 per day up to a maximum of $2,000. The amount of the underpayment is irrelevant. Penalties have been awarded for an underpayment of as little as $.03 per week. 9.3.3 Late or non-payment of indemnity benefits – LSA-R.S. 23:1201(F) Failure to timely pay benefits could result in a penalty under LSA-R.S. 23:1201(F). This penalty is $50 per day up to a maximum of $2,000. 9.3.4 Late or non-payment of medical benefits – LSA-R.S. 23:1201(F) Medical benefits must be paid within 60 days of written receipt, within 30 days of electronic receipt. A defense to late payment (if the claim is accepted) is evidence that the late payment was due to circumstances beyond the control of the employer/insurer. A request for reimbursement of mileage is considered a request for payment of medical benefits and is governed by the same rules. 9.3.5

Failure to consent to the employee’s request to select a choice of physician – LSA-R.S. 23:1201(F)

While there is not a deadline by which the claimant must be allowed access to their choice of physician or be allowed to change their choice of physician, the Courts tend to apply a

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reasonableness standard to measure whether the delay was justified. Such approvals should be made as close as possible to the date the request was made. 9.3.6 Failure to provide medical reports upon request – LSA-R.S. 23:1125 For all medical providers to which the claimant is “referred by the employer,” the employer or insurer must provide claimant all medical records generated by those providers within 30 days of a written request for same. This applies to the initial physician that the employee is directed to following the accident and to any second medical opinion (SMO) physician(s). Failure to do so could result in penalty of $250 plus attorneys’ fees. 9.3.7

Improper termination of benefits – LSA-R.S. 23:1201(I)

When an employer or insurer terminates payment of claims owed, and the termination is found to be arbitrary, capricious, or without probable cause, the Court could impose a penalty not to exceed $8,000 and a reasonable attorneys’ fee for the prosecution and collection of such claims. 9.3.8

Late or underpayment of a final judgment – LSA-R.S. 23:1201(G)

In short, all final judgments (judgment that cannot be appealed), must be paid within 30 days of the signing of the judgment. A court approved settlement is considered a final judgment. This penalty is mandatory. If the judgment is paid on the 30th day, there is no penalty imposed. If the judgment is paid on the 31st day, the penalty is imposed. Understand – there is NO excuse for failure to pay a judgment under LSA-R.S. 23:1201(G) – none whatsoever.

9.4 Multiple penalties An issue that remains unresolved is how penalties are calculated. This will likely never be fully clarified. The general rule – that is not always followed – is that: • • • • • •

Bills from different medical providers can be considered separate claims. Multiple treatment bills from one provider are covered by one (1) penalty. Failure to authorize a surgery or a specific test/study by a particular doctor can be considered a separate claim from other treatment by that same doctor. Mileage expense associated with treatment by a particular provider is part of the claim for treatment by that particular provider. Incorrect calculation of a benefit amount is a separate claim from the failure to actually pay benefits. Reduction of a benefit amount constitutes yet another separate claim.

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9.5 The penalty “cap” Both LSA-R.S. 23:1201(F) and 1201(I) discuss an $8,000 “cap” for penalties; however, it is generally held now that those are two (2) separate “caps.” If the facts are present to support the imposition, the Court could award $8,000 under LSA-R.S. 23:1201(F) AND $8,000 under LSA-R.S. 23:1201(I).

RELATED CASE LAW CASE Wilson v. Glazer’s Distrib. of La, 185 So.3d 891 (La. App. 5 Cir. 2/5/16), 15-493

DESCRIPTION WCJ awarded claimant an $8,000 penalty under LSA-R.S. 23:1201(I) for denying the claim without probable cause and an $8,000 penalty under LSA-R.S. 23:1201(F) for failure to pay wages, medical care, and authorize treatment. However, on appeal, the Fifth Circuit reduced the total amount of penalties from $16,000 down to $8,000. The Fifth Circuit reasoned that $8,000 cap on penalties applied to the entirety of LSA-R.S. 23:1201, not any individual section of the statute.

9.6 Defenses to penalties LSA-R.S. 23:1201 does recognize that the imposition of penalties is not automatic. Generally, the employer or insurer must possess sufficient factual and medical information to reasonably controvert the claim. To meet this standard, the employer or insurer must have some “ valid reason or evidence upon which to base his denial of benefits. ” The Court must determine whether the employer/insurer “ engaged in a non-frivolous legal dispute or possessed factual and/or medical information to reasonably controvert the factual and medical information presented. ”

9.7 Attorneys’ fees In addition to receiving an award of penalties, the claimant can also be awarded attorneys’ fees. Factors to be considered in imposition of reasonable attorneys’ fees in Workers’ Compensation cases include: • • • •

Degree of skill and work involved in the case. Amount of the claim. Amount recovered. Amount of time devoted to the case.

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How do I settle Workers’ Compensation claims?

10.1 TYPES OF SETTLEMENT 10.2 PREPARING FOR THE SETTLEMENT 10.3 THE SETTLEMENT DOCUMENT PROCESS 10.4 MEDICARE CONSIDERATIONS

10. How do I settle Workers’ Compensation claims?

10.

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10. How do I settle Workers’ Compensation claims? In Louisiana there are two (2) broad categories of settlements – the 1008 and a full and final settlement of the entire Workers’ Compensation claim. There are two (2) forms of full and final settlements – the lump-sum settlement and the compromise settlement.

10.1 Types of settlement 10.1.1 Settling the disputed claim for compensation Also known as “settling the 1008,” “compromising the 1008,” “resolving the 1008,” etc., this form of settlement resolves all of the issues pled in the 1008 up to the date the settlement is put in writing and all parties sign, or when the settlement is put “on the record” before the Court on the subject of a signed Order or Judgment. After settling the 1008, the claim reverts to a non-litigated claim with a represented claimant; however, the day after the settlement is signed, the claimant has a whole new opportunity to seek an additional cap of penalties and attorneys’ fees. 10.1.2 Full and final compromise settlement (compromise settlement) This is the most common type of settlement. In this form of settlement, parties are settling fully and finally, but still disagree on one (1) or more issues. The parties maintain their ability to negotiate as to any specific amount or issue. 10.1.3 Full and final lump sum settlement (lump-sum settlement) In this settlement, payment is made exactly on what the claim is worth (subject to a discount no greater than eight [8] percent) rather than letting the claim run its full course. These types of settlement are very risky. There is no negotiation; payment is simply made on what would be paid over the course of the claim.

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The only negotiable point is that you can negotiate on present value, but you can never discount more than eight (8) percent. If you discount greater than eight (8) percent, the claimant can seek the penalty under LSA-R.S. 23:1274 even if the settlement was previously approved by him or her and the Court. The penalty that you would be liable for is one and a half percent (1.5%) of the total compensation that would be due absent the settlement. The claimant can seek this penalty for up to two (2) years after the settlement.

10.2 Preparing for the settlement Settling is more than just reaching a number the other side will accept and sending an email that the claim is settled. Below are some specific tips and methods for settling a claim:

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You Must Obtain Employer Approval

You must get the approval of the employer to the settlement. Without the employer’s preapproval of the settlement amount, there is no settlement. The Court will not accept any settlement that does not have the employer’s written approval. Further, owing to ethical obligations in Louisiana, attorneys are bound to communicate the terms of the settlement with the employer. Some customers require approval of settlements only after a threshold amount - that does not matter in Louisiana. The employer has to approve every settlement.

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Handling of involvement of the Center for Medicare Services (CMS)

Attorneys securing an Medicare Set-Aside (MSA) or structuring payment of the MSA, or of the medicals, need to ensure that the claimant knows, and accepts, the annuity numbers he/ she provides. If you are securing an MSA or an annuity, you must coordinate with the company preparing the MSA or annuity to address whether there is specific language or documents that need to be presented along with the settlement documents.

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Handling of Statutory Liens

Any statutory liens (liens that are automatic according to statute) – for example from statefunded hospitals, the U.S. Department of Veterans Affairs (VA), Medicare, etc., – must be satisfied. These parties do not have to intervene into the suit to protect their rights. Employers or their representatives need to ask the claimant if he/she was treated at any of these places or if these agencies pay any related medical expenses.

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Handling of Non-statutory Liens

Any non-statutory liens of which the employer or its representatives have a notice of lien must be satisfied. This type of lien includes liens from providers. If there is a non-statutory lien notice of which you are aware, it must be paid – but you are not required to go looking for non-statutory liens to pay.

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Handling of Child Support Payments/Orders

If there is a child support Order resulting in the reduction of the claimant’s benefits, employers or their representatives have to coordinate with the child support agency in question to ensure

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any outstanding balance is satisfied. This amount can be negotiated, but you should secure documentation from the agency and the claimant to the amount agreed upon.

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Handling Settlements with SIF Involvement

If reimbursement is received under the Louisiana Second Injury Fund (SIF), you must seek approval from the SIF Board before the Judge signs the settlement. Note that securing approval of the SIF Board usually takes two (2) to three (3) months after the forms are submitted. If the Judge signs the settlement without the SIF Board first giving approval, then the SIF is relieved of any future payments. Note also that a copy of the SIF letter accepting the settlement amount is required.

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Handling of Conditional Payments

Conditional payments made by the Center for Medicare Services (CMS), must be satisfied. Written proof is required that this has been satisfied.

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Payment of Medical Expenses

The employer or its representatives needs to coordinate with the claimant, or his/her counsel, as to who will be responsible for payment of any outstanding medical bills or expenses. Absent some agreement to the contrary, employers or insurers are always responsible for payment of reasonable and necessary medical expenses related to the accident incurred up to the date the settlement is signed by the Judge.

10.3 The settlement document process Once the above issues have been satisfactorily addressed, settlement documents can be prepared. 10.3.1 Documentation needed For every settlement, the following is needed. • • • • • •

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A copy of the First Report of Injury ; Copies of most recent medical records; Average weekly wage (AWW) used; A copy of file notes to ensure that there are no additional issues addressed above that need to be resolved; Total amount of indemnity and medicals paid on the claim; Results of any research into the issues discussed above. For example, there is no outstanding child support owed, but there is a lien from the VA that will be satisfied separately. So, a copy of the VA lien notice will need to be included as well as a copy of the check issued to the VA; Employer’s contact information; Employee’s contact information; Contact information for employee’s counsel (if represented).

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10.3.2 Deadlines If you do not tell us about a deadline, we will assume there is no deadline. 10.3.3 Payment Payment must be made within 30 days after the Judge signs the settlement. If payment is not made within 30 days after the Judge signs the settlement, then the claimant can seek penalties under LSA-R.S. 23:1201(G). 10.3.4 Waiting for the settlement approval Again, there is no settlement until the Judge signs the settlement documents. An employer must let its attorney know immediately should he/she become aware of anything that changes the response to any of the issues/requirements noted above. Employer or insurer need to continue to pay all benefits previously provided until the date the Judge signs the Order unless otherwise agreed.

10.4 Medicare considerations 10.4.1 CMS interests According to the CMS, the employer or insurer has an obligation to protect CMS’s interest in every case. Under CMS guidelines, there is no situation in which the need to protect their interests can be ignored. “Protecting/considering” the interests of CMS does not mandate a Medicare Set-Aside (referred to by CMS as “WCMSA”) in all settlements, but employers need to do something to reasonably consider the interests of Medicare against it being called upon to pay for medical treatment that an employer or insurer should have been paying. Obtaining CMS approval is simply the safest option to ensure CMS approval for that particular settlement amount. In an effort to make its rules easier to understand, CMS has created two (2) types of beneficiaries – Class I beneficiaries and Class II beneficiaries 10.4.1(a) • • • •

Class I beneficiary

Claimant is 65 years or older. Claimant has been on Social Security Disability Insurance (SSDI) for 24 months or longer. Claimant has End State Renal Disease (ESRD). Regardless of amount of the settlement, if the actual value of the settlement including future medicals exceeds $25,000 it is recommended the settlement be submitted to CMS for review. Regardless of amount of the settlement, if the actual value of the settlement is less than $25,000, an employer or insurer is not required to submit the settlement for review by CMS, but the employer or insurer is still obligated to show that “ he/she considered the interest of Medicare .”

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10.4.1(b) •

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Class II beneficiary

CMS approval is not required – but highly recommended – when settlement is less t h a n $250,000 and where the claimant has a “reasonable expectation” of enrollment in Medicare within 30 months. There is no exhaustive list, but some common situations include: ƒƒ ƒƒ ƒƒ ƒƒ ƒƒ

Claimant has applied for SSDI; Claimant is collecting SSDI, but not yet Medicare eligible; Claimant has been denied SSDI, but anticipates appealing or is in the process of appealing; Claimant is 62 years and 6 months old (would automatically be eligible for Medicare within 30 months); Claimant has End Stage Renal Disease (ESRD), but does not yet qualify for Medicare based upon ESRD.

10.4.2 Future Medicals “Protecting Medicare’s interest” requires that settlements provide an amount for future medicals sufficient to ensure that Medicare never has to pay for any of the related medical treatment. CMS does not require that numbers be perfect, but calculations have to be reasonable and supportable. These calculations should be included in your adjustors’ notes or in some documentation in the file.

RELATED CASE LAW CASE Louisiana Commerce & Trade Ass’n, SIF v. Williams, 174 So.3d 696 (La. App. 1 Cir. 6/5/15

DESCRIPTION Claimant injured in a compensable work accident. Claimant filed and settled a tort suit, then agreed to settle his Workers’ Compensation claim for reimbursement of benefits paid by the WC carrier and funding of an MSA. Despite said agreement, claimant failed to provide the necessary information needed for CMS approval of the MSA for two (2) years. The WCJ ultimately approved the MSA as prepared by the employer and approved by CMS, despite claimant’s objection to the MSA. The Court of Appeal found the WCJ did not abuse her discretion in incorporating the MSA into the approved settlement.

10.4.3 Recent CMS recovery changes Note that as of October 5, 2015, CMS may now pursue recovery of funds paid out in a claim prior to settlement of that matter. This is significant, as in the past CMS typically only pursued recovery when a case was settled. CMS will now issue what is termed a Conditional Payment Notice (CPN), which you must object or respond to within 30 days of receipt or it converts into a demand.

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4/12/17 9:15 AM

Wc 10 things to know allen & gooch  

This publication is intended to help our clients and colleagues understand how to proactively manage Workers’ Compensation issues and claims...

Wc 10 things to know allen & gooch  

This publication is intended to help our clients and colleagues understand how to proactively manage Workers’ Compensation issues and claims...

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