The following memo surveys the Industrial Claim Appeals Office (I.C.A.O.) and the Colorado Court of Appeals decisions issued in May of 2011. If you have any questions about the future implications of each one of these cases, please never hesitate to contact us.
Beth Robinson v. Goodbye Blue Monday, W.C. No. 4-613-287 (April 21, 2011)
The parties entered into a full and final settlement agreement, which included funding of a Medicare Set Aside (MSA). The settlement agreement provided that Respondents would fund the MSA upon CMS approval. Another provision stated that MSA funding was contingent upon CMS approval and Respondents agreed to pay for maintenance medical benefits during the approval process.
After the settlement agreement, the Social Security Administration awarded the Claimant retroactive Social Security Disability Income (SSDI) benefits. Respondents refused to submit the MSA for CMS approval. Respondents also refused to pay maintenance medical benefits pending approval of the MSA. Respondents argued that submission of the MSA to CMS was futile because the amount of the settlement was under $250,000 and CMS would not likely consider the MSA proposal.
The ALJ determined that Respondents’ conduct caused the Claimant “great harm and potential harm.” The ALJ assessed penalties in the amount of $300 per day from November 23, 2009 through July 29, 2010 for Respondents’ failure to pay maintenance medical benefits, which the ALJ construed as unilateral termination of medical benefits despite the amendments to W.C.R.P. Rule 7-2. The I.C.A.O. affirmed the ALJ’s assessment of monetary penalties against Respondents.
Deanna Siefken v. The Home Depot, W.C. No. 4-740-549 (April 27, 2011)
The I.C.A.O. issued two separate opinions on April 27, 2011 in favor of Respondents. One case concerned insurance coverage and penalties. The second case concerned permanent partial disability benefits and medical maintenance benefits.
In the first case, Claimant sought monetary penalties for the employer’s alleged failure to carry worker’s compensation insurance. Claimant argued the employer’s contractual obligation to reimburse the insurer was considered a “deductable.” The Colorado Workers’ Compensation Act prohibits deductibles from exceeding $5,000. The ALJ determined that the contractual obligation was not a deductable because a deductable is defined as “the portion of the loss to be borne by the insured before the insurer becomes liable for payment.” Thus, Respondents did not violate the Act’s insurance coverage requirements. The I.C.A.O. affirmed.
In the second case, the insurer, but not Respondents’ attorney or the employer received a DIME report. Respondents did not receive the DIME addendum report until several months later. Respondents subsequently filed an Application for Hearing to overcome the DIME on the issue of MMI and impairment. The DIME provided a 23% whole person impairment rating, which the ALJ overruled and provided no impairment. The Claimant argued that Respondents failed to timely file an Application for Hearing challenging the DIME physician’s opinion on MMI and impairment. The ALJ determined Respondents’ receipt of the DIME addendum report triggered the statutory 30 day time limit to file an Application for Hearing to challenge the DIME physician’s opinion. The I.C.A.O. affirmed.
Ben Steele v. Oakland Raiders, W.C. No. 4-833-191 (April 27, 2011)
Claimant, who resided Colorado and played football in California, filed a claim for workers’ compensation benefits in California. Respondents filed the Employer’s First Report of Injury in Colorado. The Director assessed monetary penalties against Respondents failure to file a position within 20 days. Respondents submitted documents to the Director evidencing that Claimant sought benefits in California for alleged cumulative trauma. While the I.C.A.O. vacated the Director’s penalties order, the case was remanded to determine whether it was necessary for Respondents to admit or deny the claim given that the First Report of Injury was filed in Colorado.
Schell v. Tolin Mechanical Systems, W.C. No. 4-592-624 (May 11, 2011)
Respondents sought to introduce testimony of an employer witness at hearing. The ALJ barred the witness’s testimony on the grounds that Respondents failed to endorse the witness on their Response to Application for Hearing. A co-Respondent removed from the claim prior to hearing endorsed the witness on their Response to Application for Hearing. The I.C.A.O. affirmed the ALJ’s decision holding that only witnesses endorsed on the pleadings may testify not withstanding a later order or written agreement.
Medina-Weber v. Denver Public Schools, W.C. No. 4-782-625 (May 9, 2011)
During a previous claim, Respondents overcame a DIME that assessed a 13% whole person impairment rating. The DIME also apportioned 10% of the 13% whole person impairment rating to previous injuries. At hearing, the ALJ assessed no permanent impairment. During a later case, the Claimant underwent a DIME, which determined physical impairment with no apportionment. The later ALJ determined that no apportionment was applicable because the previous ALJ provided no ratable impairment.
On appeal, the I.C.A.O. stated that the DIME report must be overcome by clear and convincing evidence. Although the first ALJ determined permanent impairment, the Claimant did not overcome the first DIME physician’s apportionment determination by clear and convincing evidence. Thus, the I.C.A.O. held that apportionment was applicable and remanded the case for an apportionment determination.
Munoz v. Industrial Claim Appeals Office, No. 10CA0592 (May 12, 2011)
This case involved whether DIME proceedings are stayed during the pendency of a dispute over the DIME selection process. The Court of Appeals held that when an Application for Hearing challenging the DIME selection process is filed with the Office of Administrative Courts and the party serves the Division DIME Unit, the stay of DIME proceedings is automatic. The Court of Appeals dismissed the remaining penalties issue.