State News : Iowa

Des Moines Area Regional Transit Authority and United Heartland v. Arbreina Young, Supreme Court of Iowa, No. 14-0231

Claimant, Arbreina Young, was employed by the Des Moines Area Regional Transit Authority (DART) as a bus driver. On June 2, 2009, the bus she was driving collided with an empty vehicle on DART premises. She sought medical treatment for a back injury and returned to work on June 8, 2009.

Claimant was sent by DART to an orthopedic surgeon, Dr. Daniel McGuire. Dr. McGuire referred Claimant to Dr. Donna Bahls for pain management. Dr. Bahls treated Claimant from August 2009 to November 2011. On March 18, 2010, Claimant went to Dr. Jacqueline Stoken for a medical examination. The examination was not authorized by DART, but arranged independently by Claimant. In Dr. Stoken’s report, she concluded Claimant reached maximum medical improvement (MMI) on March 11, 2010, and suffered a permanent disability to her back. She assigned Claimant a fifteen percent body-as-a-whole impairment rating and also imposed work restrictions.

On April 16, Claimant underwent a functional capacity evaluation. The evaluation found she should be limited to light to medium categories of work. On May 18, Dr. Bahls determined Claimant had reached MMI, suffering a permanent disability to her back, and assigned her a five percent body-as-a-whole impairment rating. She also adopted the restrictions recommended by the functional capacity evaluation.

Claimant filed a workers’ compensation claim on December 29, 2010, and the case proceeded to a hearing before a deputy workers’ compensation commissioner. At the hearing, Claimant submitted the report from Dr. Stoken as evidence. Following the hearing, the deputy commissioner found Claimant suffered a permanent partial disability to her back resulting in a twenty-five percent reduction in earning capacity. The deputy commissioner also taxed as a cost against DART the expense of Dr. Stoken’s examination and report under the administrative rule governing the assessment of costs in a hearing.

The commissioner affirmed the decision of the deputy commissioner. DART filed for judicial review. The district court affirmed the decision of the commissioner. DART appealed. The sole issue raised on appeal concerned the award as a cost of the examination and report by Dr. Stoken. The court of appeals reversed the district court’s ruling. It found the practice of assigning the expense of an examination as a cost under the rule would defeat the statutory requirements governing the reimbursement of an independent medical examination. Further, the court of appeals determined that Dr. Stoken’s bill was a charge for the examination, not a report, as required by the language of Iowa Administrative Code rule 876—4.33. Clamaint sought and the Iowa Supreme Court granted further review.

The Iowa Supreme Court rejects Claimant’s argument that hearing costs include the expenses of an independent examination because the examination is necessary to obtain a report on the results of the examination for a hearing. The Court agrees that a physician’s written report of an examination and evaluation under Iowa Code section 85.39 would be a reimbursable expense under section 85.39, just as an unreimbursed written report of an examination and evaluation, like deposition testimony and witness fees, could be taxed as hearing costs by the commissioner. Yet, a physician’s report becomes a cost incurred in a hearing because it is used as evidence in lieu of the doctor’s testimony. The underlying medical expenses associated with the examination do not become costs of a report needed for a hearing, just as they do not become costs of the testimony or deposition. The logic of Claimant’s argument is not supported by the language of the governing statutes or the overall workers’ compensation scheme.

The Iowa Supreme Court further concludes section 85.39 is the sole method for reimbursement of an examination by a physician of the employee’s choosing and that the expense of the examination is not included in the cost of a report. Moreover, even if the examination and report were considered to be a single, indivisible fee, the commissioner erred in taxing it as a cost under administrative rule 876—4.33 because the section 86.40 discretion to tax costs is expressly limited by Iowa Code section 85.39. Our legislature established a statutory process to govern examinations of an injured worker in order to obtain a disability rating to determine the amount of benefits required to be paid by the employer. Neither courts, the commissioner, nor attorneys can alter that process by adopting contrary practices. If the injured worker wants to be reimbursed for the expenses associated with a disability evaluation by a physician selected by the worker, the process established by the legislature must be followed.

In sum, the Iowa Supreme Court concludes the commissioner erred in interpreting Iowa Code sections 85.39 and 86.40 (2009) and Iowa Administrative Code rule 4.33. The Court therefore affirms the decision of the court of appeals. The Court remands to the district court to remand the case to the commissioner for further proceedings consistent with this decision. Only the costs associated with the preparation of the written report of Dr. Stoken can be assessed as costs of the hearing.

Call Mark Bosscher or Lee Hook with any questions @ 515-243-2100.  We’d be happy to help, whether it be a quick or a complex issue!