Thomas P. Kieselbach,
1550 Utica Ave. South, Ste. 600
Minneapolis, MN 55416
Phone: 952.525.6955
E-mail: tpk@cousineaulaw.com

Case Law Updates

Jurisdiction

Brian K. Martin, Employee, vs. Morrison Trucking, Inc., Respondent, and Travelers Insurance Company, Relator, and Minnesota Department of Labor and Industry, Special Claims Section, f/k/a Special Compensation Fund, Respondent, Minnesota Supreme Court, filed August 3, 2011.

Minnesota Statutes § 175A.01, subd. 5 (2010), provides jurisdiction to the Workers’ Compensation Court of Appeals to decide only questions of law and fact arising under the workers’ compensation laws of Minnesota.

The Workers’ Compensation Court of Appeals has jurisdiction to determine whether an insurance contract provides Minnesota workers’ compensation insurance.

The Workers’ Compensation Court of Appeals did not have jurisdiction to declare an unambiguous exclusion of Minnesota coverage in the insurance contract held by the employer in this case to be invalid and unenforceable because the exclusion conflicted with Wisconsin statutory provisions and public policy.

Reversed. Justice G. Barry Anderson. Concurring, Justice Paul H. Anderson. Took no part, Justice Alan C. Page.

Age 67 Presumption

Frandsen v. Ford Motor Company, A11-0126, Minnesota Supreme Court, filed August 10, 2011

The Minnesota Supreme Court determined the age 67 retirement presumption, codified in Minn. Stat. § 176.101 subd. 4, applies unless the employee rebuts the presumption or proves the employer and insurer knowingly and intentionally waived the statutory right to assert the presumption.

The Workers’ Compensation Court of Appeals (WCCA) held the employer waived its right to later assert the retirement presumption in a to-date stipulation for settlement.  The WCCA reviewed the to-date settlement and concluded the employer waived the retirement presumption because “the parties did not incorporate into the settlement agreement the presumptive retirement provision.”

The Minnesota Supreme Court reversed the WCCA.  The Court criticized the WCCA’s decision as it required an employer to expressly reserve the retirement presumption and such requirement improperly relieves the employee of his or her burden to rebut the presumption by a preponderance of the evidence or to prove the employer knowingly and intentionally waived the presumption.  The Court clarified for there to be waiver, two elements must exist: (1) knowledge of a right; and (2) intent to waive that right.  Waiver can be expressed or implied, but either type requires an expression of intent to relinquish the right.  Employee must prove waiver by producing evidence of knowledge and intent in the form of:

(1)    language in a stipulation for settlement between the parties;
(2)    affirmative conduct on the part of the employer; or
(3)    circumstances that would ascribe meaning to the employer’s silence.

The Minnesota Supreme Court held the retirement presumption shall apply unless the employee rebuts the presumption or affirmatively proves waiver.  Simple absence of specific language reserving the retirement presumption in a stipulation for settlement is not enough, standing alone, to support a finding the employer and insurer waived their right to assert the age 67 retirement presumption.

Medical Expenses

Troyer v Vertlu Management Co., Minnesota Supreme Court, filed August 17, 2011 ~ Reviewed by Craig A. Larsen

The Supreme Court affirmed the Compensation judge and the WCCA’s decision that a hospital can charge directly for implant hardware, and that a compensation judge has no authority to determine a reasonable price for the hardware to be less than 85% of a hospital’s usual and customary price.

The employee had a spinal cord stimulator implanted at HealthEast St. Josephs Hospital.  HealthEast billed $73,320, its usual and customary charge, for the hardware along with other charges for the surgery. This charge included a significant mark up over what it actually paid the manufacturer. The insurer paid the other charges, but paid only a portion of the amount billed for the hardware, less than 85% of the charge. HealthEast filed a medical Request for the difference between the amount paid and 85% of their usual charge.

The employer and insurer argued that HealthEast did not “furnish” the hardware, but that the manufacturer was the entity that “furnished” the hardware. Consequently, the manufacturer should be the entity billing for the hardware pursuant to Minn. R. 5221.0700, subp.2A. The Supreme Court held, after going through a tedious construction of the rules regarding payment of medical expenses, that when more than one health care provider is responsible for the creation or transmission of a service, article or supply, the provider that provides it in its final usable form has “furnished” it, and is the one to properly charge for it.

The employer and insurer also argued that the compensation judge has authority to determine a reasonable value for a service, article, or supply at less than 85% of the usual and customary charge, or prevailing charge, in accordance with Minn. Stat. 176.136. After discussing the language contained in Minn. Stat. 176.136, and specifically Minn. Stat.176.136, subd. 1b(b) the Court held that a compensation judge does not have authority to determine a reasonable value of medical services at less than 85% of usual and customary or prevailing charges.

Given the outcome of this case, it will be difficult to contain future medical costs for implantable devices associated with workers’ compensation claims.

Covered Employees

Francisco Vargas-Velasquez v. Hernandez Expert Roofing, WCCA, filed June 23, 2011 ~ Reviwed by Joshua Borken

The WCCA affirmed the Compensation Judge’s conclusion that Vargas-Velasquez was not an employee of Hernandez Expert Roofing and was not covered by that company’s workers’ compensation insurance policy because the Articles of Incorporation and the certificates of workers’ compensation insurance clearly identified the petitioner as a stockholding executive officer of the corporation who had not expressly opted for personal insurance coverage as required under the statute.

Expansion of Issues Upon Appeal

Ellingboe v. Lowes, WCCA, filed May 13, 2011 ~ Reviewed by Jennifer Augustin

The Employer and Insurer filed a NOID based on an IME report opining that the Employee’s left foot condition was a result of his genetic makeup, not his work injury.  An administrative conference was held, whereby the issue of causation was addressed and the compensation judge found for the Employee.  The Employer and Insurer appeal and argue the Employee did not engage in a diligent job search.  The WCCA held this was an improper expansion of the issues beyond those addressed at the hearing.  The Employer and Insurer argued that when the Employee’s attorney failed to object to questions about job search asked of the Employee during cross-examination and made no objection to the employer and insurer’s attorney raising the issue in her closing argument, the Employee’s attorney consented to the job search as an issue.  The WCCA held an agreement to the expansion of the issues could not be construed in any way on these facts.

Mental Injuries

Quijada v. Heikes Farms, Inc.,  WCCA, filed May 4, 2011 ~ Reviewed by Jennifer Augustin

The Employee appealed the compensation judge’s finding that this psychological condition was unrelated to his personal injury.  The WCCA affirmed, stating that, in cases involving mental injury, the fact that there exists a temporal relationship between the injury and the onset of a mental condition, standing alone, is insufficient to establish causation.  It does not necessarily follow that because the depression came after the injury that the injury caused the depression.  Rather, some medical opinion causally relating the mental condition to the physical injury is required before the depression can be found compensable.  The Employee further argued that his personal injury caused him to be unemployed which, in turn, resulted in financial and family problems.  The WCCA found this to be an intervening non-medical factor which separated the personal injury from the claimed psychological consequence.

Payments to Out-of-State Intervenors

Schatz v. Interfaith Care Center
,  WCCA, filed June 16, 2011 ~ Reviwed by Joshua Borken

Minn. Stat. §176.136, subd. 1b(d), which limits an employer’s liability for the cost of medical treatment provided outside of Minnesota, is not in conflict with Minn. Stat. §176.135. The Court reversed the compensation judge’s finding that relieving the employer of liability under Minn. Stat. §176.136, subd. 1b(d)would effectively transfer liability from the employer to the employee in conflict with Minn. Stat. §176.135.  The Employee was injured in Minnesota and then moved to Wyoming and received treatment for her injury in Wyoming.  The statute at issue has a provision that limits an insurer’s liability for out-of-state medical care to the amounts the providers would have received under the workers-compensation law of the state where the treatment occurs.  The Wyoming provider’s financial policy form, initialed by the Employee, provided that the Employee was responsible for any remaining balance not covered by workers’ compensation.  This is the first application of the statute by the WCCA.  The dissenting opinion believes the statute reverses 90+ years of case law and conflicts with a fundamental provision of the workers’ compensation statute, specifically requiring an injured work to pay for medical treatment that is related to the work injury and is necessary to cure and relieve the effects of the injury.

Physical-Mental Injuries

Kim v. Moneygram International, Inc.,  WCCA, filed June 14, 2011

The WCCA affirmed the Compensation Judge’s finding that a claimed unwanted sexual contact during an IME was not a substantial contributing factor to the employee’s psychological or mental symptoms. The employee attended an IME for a claimed low back injury.  During the examination, the IME doctor placed his hands on the employee’s breasts as part of the exam.  The employee claimed, as a result of the unwanted sexual contact she developed PTSD and panic disorder.  The Compensation Judge found no physical injury, and therefore any psychological injury was not compensable under Lockwood v. ISD #877.  The Compensation Judge adopted the independent psychological evalutor’s opinion that the events at the IME  were not a substantial contributing cause of any psychological symptoms.  Finding the psychological evaulator’s opinion to be well founded, the WCCA affirmed.

Removal from Job Market

Schweder v. Covalence Specialty Materials Corp., WCCA, filed May 26, 2011 ~ Reviewed by Jennifer Augustin

The Employee appealed the compensation judge’s conclusion that his move from the Twin Cities to Hoyt Lakes constituted a withdrawal from the labor market so as to preclude the receipt of temporary total disability benefits.  The WCCA reversed, holding that, while the labor market in St. Louis County is smaller than the labor market in the Twin Cities, the evidence did not support a determination that the employee would be able to obtain only sporadic, short-term employment resulting in grossly insubstantial income or that employment opportunities were virtually nonexistent in St. Louis County.

Chronic Pain Program

Griffin v. Kindred Hospitals
,  WCCA, 4/4/11 ~ Reviewed by Nicole Kampa
The WCCA held that the Compensation Judge erred in finding treatment received at a pain center was closed out under a prior stipulation for settlement. In the present case a prior stipulation for settlement closed out medical expenses in the nature of “multi-dimensional in-patient and out-patient chronic pain treatment programs.” The WCCA held that the treatment received in the present case did not meet all mandatory requirements of Minnesota Rules 5221.6600, subpart 2.E. defining multidisciplinary chronic pain management programs. Careful attention to language in a stipulation for settlement may help ensure a complete close-out of all desired medical expenses.

Joinder

Johnson v. McDowall Companies,  WCCA, 4/12/11 ~ Reviewed by Nicole Kampa
The WCCA affirmed the Compensation Judge’s denial of a motion for joinder on grounds it would delay an expedited hearing and was not necessary for resolution of the claims. The WCCA held a motion to join a subsequent employer and insurer that was filed the week before an expedited hearing would have delayed the hearing. The employer was not prejudiced since the Court found it could assert a contribution claim in a subsequent proceeding. The WCCA also held the Compensation Judge’s factual conclusions concerning competing medical opinions was not clearly erroneous as a matter of law.