State News : New Jersey

It is not uncommon for injured workers to suffer additional injuries due to car accidents on the way to a physician’s office or physical therapist’s office. So what are the rules in New Jersey on compensability?

Q. Is the injured worker covered for workers’ compensation purposes in a car accident on the way to treatment?

A. The case of Camp v. Lockheed Electronics, Inc., 178 N.J. Super. 535 (App. Div.), certif. denied, 87 N.J. 415 (1981) provides the answer to this question. In that case the employee fell at work on December 27, 1968 injuring her coccyx, low back and right leg. Then a year later petitioner was driving back from a visit to her physician when she was seriously injured in a car accident on March 9, 1969. She ended up having surgery in 1970. Her lawyer failed to file a claim petition for the car accident, and the petitioner received no award of compensation. The Appellate Division reversed in favor of petitioner, noting that Professor Larson’s treatise on workers’ compensation summarized the law around the nation on this issue:

A fall or automobile accident during a trip to a doctor’s office has usually been considered sufficiently causally related to the employment by the mere fact that a work-connected injury was the cause of the journey, without any necessity for showing that the first injury in some way contributed to the fall or accident.

The basic rule then is that an injury on the way to authorized treatment is compensable.

Q. Is the injured worker covered in a car accident on the way to an IME for permanency?

A. There is no case directly on point but there is a case which states that an injury in a car accident on the way to a fitness for duty examination requested by the employer does not arise out of work. In this practitioner’s opinion, a commute to an IME for purposes of permanency is not compensable because there is no authorized treatment involved. That is the essence of the rule in Camp noted above. A claimant who pursues permanency benefits does so as part of a litigation process. Both parties send the claimant to respective experts, but the attendance at the exams is due to litigation, not for purposes of treatment.

Q. What if an occupational facility uses a company like Uber to pick up the injured worker from work or home and then take the employee to treatment? Is a car accident on the way to treatment covered under those circumstances?

A. In the opinion of this practitioner, such an injury would be compensable under the rule in Camp. It would make no difference that the injured worker was not driving his or her own car. The rule in Camp would still apply because the employee was on the way to authorized treatment.

Q. Does an employer have a lien if the injured worker sues another driver who causes a car accident on the way to treatment?

A. Yes, since the car accident is a workers’ compensation injury, the employer has lien rights to any recovery from that accident under N.J.S.A. 34:15-40.

More and more occupational facilities are offering to transport injured workers to PT or doctors’ appointments either from work or home, using Uber or Lyft or similar services. A motor vehicle accident in such circumstances will almost certainly lead to a civil law suit because fault will likely lie with either that of the transport service driver or the other driver. The employer must pay workers’ compensation benefits, but there is a high likelihood of a third party claim with subrogation rights reserved to the employer.

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John H. Geaney, Esq., is an Executive Committee Member and a Shareholder in Capehart Scatchard's Workers’ Compensation Group.  Mr. Geaney concentrates his practice in the representation of employers, self-insured companies, third-party administrators, and insurance carriers in workers’ compensation, the Americans with Disabilities Act and Family and Medical Leave Act. Should you have any questions or would like more information, please contact Mr. Geaney at 856.914.2063 or by e‑mail at jgeaney@capehart.com. 

The EEOC has provided guidance that in its view a fairly long leave of absence should be considered a reasonable accommodation even after FMLA leave has been exhausted.  The Court in Severson v. Heartland Woodcraft, Inc., 33 AD Cases 1113, September 20, 2017 disagreed rather strongly with that view and did not follow EEOC advice.

Mr. Severson worked for Heartland since 2006 performing a variety of manual labor duties in the production area of the plant, operating production machinery, making minor repairs, maintaining the building, and frequently lifting items and product weighing 50 pounds or more.

On June 5, 2013, petitioner wrenched his back at home, which aggravated a back problem dating back to 2005.  He received FMLA leave over the summer months for care of multiple herniated discs.  On August 13, 2013, Severson called HR and advised that he needed to undergo back surgery on August 27, 2013, seeking an extension of his medical leave of several months.  The company advised that his FMLA leave would expire on August 27, 2013. The company stated that Severson’s employment would terminate when his FMLA leave expired.  He was told that he could reapply when he recovered from his surgery.

Severson’s doctor performed surgery, then in October put restrictions on him and eventually removed his 20 pound lifting restriction on December 5, 2013.  He was given clearance to return to work without limitation.  Instead of reapplying for the position, Severson sued and argued that the company failed to provide him with reasonable accommodation.

The trial court granted Heartland’s motion for summary judgment, and Severson appealed to the 7^th Circuit.  Severson relied on EEOC Guidance to the effect that a long-term medical leave of absence should qualify as a reasonable accommodation when the leave is of a definite, time-limited duration and is likely to allow the worker to return to the job and perform essential job functions.  The Court said as follows:

Perhaps the more salient point is that on the EEOC’s interpretation, the length of the leave does not matter.  If, as the EEOC argues, employees are entitled to extended time off as a reasonable accommodation, the ADA is transformed into a medical leave statute – in effect, an open-ended extension of the FMLA.  That’s an untenable interpretation of the term ‘reasonable accommodation.’

The Court affirmed the dismissal of this case, stating that a reasonable accommodation is something that allows the employee to perform the essential job functions, but a request for several months of leave is focused on not working.  It said not an extended leave of absences accomplishes the exact opposite of what the ADA is about, namely enabling the worker to do his or her job.  The logic is compelling but readers should recognize that not all United States Courts of Appeal agree on this issue.  At least in the Seventh Circuit, (Indiana, Illinois, and Wisconsin), the logic of this case will prevail.

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John H. Geaney, Esq., is an Executive Committee Member and a Shareholder in Capehart Scatchard's Workers’ Compensation Group.  Mr. Geaney concentrates his practice in the representation of employers, self-insured companies, third-party administrators, and insurance carriers in workers’ compensation, the Americans with Disabilities Act and Family and Medical Leave Act. Should you have any questions or would like more information, please contact Mr. Geaney at 856.914.2063 or by e‑mail at jgeaney@capehart.com. 

Some defenses, like the going-and-coming rule, get all the attention but there are other less well known defenses, like lack of timely notice, which can be very powerful as a defense in workers’ compensation.  One of the reasons that the notice defense is often ignored in New Jersey is its peculiar wording.  It has three stages to it.  N.J.S.A. 34:15-17 states initially that if notice of a work injury is not given to the employer within 14 days, then no compensation shall be due until such notice is given.  The employer cannot win in this stage, only delay payment until notice is provided.

The second stage says that if notice to the employer is given within 30 days, then the employee’s claim cannot be defeated unless the employer can show it was prejudiced by the delay. Finally, the statute provides that if notice is given within 90 days, AND, if the employee can show that the failure to provide notice was due to mistake, inadvertence, ignorance of fact or law, or fraud, then compensation shall be allowed,  unless the employer can prove that it was prejudiced by the failure to provide prompt notice. An employee automatically loses if the first notice occurs after 90 days.

Many practitioners tell clients that an employee only has to give notice within 90 days, but that is not entirely correct.  The employee must give notice within 30 days, and if the employer can show that lack of notice prejudiced the employer, the employer wins the case!  This practitioner calls it a 30-day rule.

Notice issues come into play more often than one would imagine even though most large employers have training sessions on the importance of providing notice of injury with 24 or 48 hours.  The statute does make clear that if the employer has actual knowledge of the injury, then the requirement of prompt notice is not applicable.  But a surprisingly high percentage of workers’ compensation claims involve situations where an employee has not reported a work injury for over 30 days.

Why is the notice defense important? For one thing, there are many unwitnessed accidents and it makes very little sense that an employee who is injured seriously enough to require treatment or file a claim would wait 30 days to report the injury.  If the injury were serious enough, there would usually be medical treatment shortly after the incident, and if medical treatment did occur, there should be statements to the physician about a work-related injury. When an employee waits weeks to report an alleged work injury, red flags should be flying.

Three defenses come to mind when an employee claims to have suffered a serious injury but does not report the injury promptly. First is the notice defense as outlined above, and the employer should argue that the delay in reporting prejudiced the employer.  Second is the defense that no accident ever took place, and efforts should be made to investigate the allegations to see if the accident can be disproved. Third is more of a medical defense, namely that if something did happen 30 days ago but was never reported within 30 days, then that event was almost certainly insignificant. Respondent should engage a medical expert to make this argument.  Bear in mind that most of us have had those days where we slip or fall without suffering any real injury beyond embarrassment.

Think about this:  if you were ever seriously hurt at work, why would you wait a month or even a week to report the injury?  What would be the advantage in NOT reporting it right away? It may make sense to wait a couple of days to see if the body recoveres, but 30 days?  That hardly seems plausible.  If the employee admits to treating outside workers’ compensation close in time to the alleged injury, the employer must obtain those records (often they are family doctor records) to see what history the employee provided to the unauthorized physician. Frequently there is no mention of any work injury at all. On the other hand, if the employee has not treated within 30 days, how significant could the event have been?

Winning notice defenses at 30 days comes down to proving that the employer was prejudiced by the delay.  Consider this:  if you rode a bike to the town library and then found an hour later that the bike was stolen, what are the chances that the police could help you if you waited 30 days to notify them? The fact of the matter is that people do report those kinds of incidents right away.  It’s common sense, but common sense often does not prevail in workers’ compensation.  If a claim is reported 30 days late, supervisors and witnesses may not remember the details of events 30 days ago, store security tapes may have been erased or played over, and physical conditions that may have caused the alleged accident will have changed.   Employers are almost always prejudiced by reporting delays of 30 or more days.  These reporting delays make no sense when one considers that most employers train employees about prompt reporting and include this in their employee manuals.

The only conclusion for employers is that these kinds of cases should be denied, and lack of timely notice should be aggressively pursued with the argument that the failure to timely report the injury has indeed prejudiced the employer.

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John H. Geaney, Esq., is an Executive Committee Member and a Shareholder in Capehart Scatchard's Workers’ Compensation Group.  Mr. Geaney concentrates his practice in the representation of employers, self-insured companies, third-party administrators, and insurance carriers in workers’ compensation, the Americans with Disabilities Act and Family and Medical Leave Act. Should you have any questions or would like more information, please contact Mr. Geaney at 856.914.2063 or by e‑mail at jgeaney@capehart.com. 

When a petitioner files a motion for medical and temporary disability benefits and the only issue is which carrier or employer is responsible, the Judge of Compensation can order benefits paid by one of the parties pending the outcome of litigation. The logic behind this rule is that it is unfair to delay benefits to an injured claimant while two potentially responsible employers or carriers fight out which of the two should be legally responsible.   But there are limits to this practical rule, as noted in Calix v. A2Z Universal Landscaping and Utica National Insurance Group No. A-3978-15T2 (App. Div. September 7, 2017).

The case began with a serious injury to Mr. Calix, who was not sure who his employer was.  He filed motions against both RNR Technologies, Inc. and A2Z.   RNR was not insured and never answered the claim petition nor responded to the motion.  Utica, as carrier for A2Z, began to make payments but stopped when it determined that there was no evidence petitioner was employed by A2Z.

Mr. Calix testified that he began working at 3200 Bordentown Avenue in Parlin, N.J. a few months prior to the accident and was paid cash.  He never received any documentation identifying his employer.  The petitioner’s certification asserted that the address above was that of RNR.  Petitioner testified that he never heard the name of A2Z and never saw any signs bearing the name of A2Z.  He said he was hired by Roger West and an individual named Steve. That was the extent of his knowledge.

The Judge of Compensation directed A2Z to pay Calix temporary disability benefits retroactively to the date of accident on the basis of an administrative court rule under N.J.A.C. 12:235-3.2 (h).  That is the rule which states that the Judge can order one of the carriers or employers to pay pending litigation where the only issue is which employer or carrier is liable. A2Z appealed the court order and contended that this rule did not apply where the critical issue in the case is employment by one of the companies.

The Appellate Division reversed the order of the Judge of Compensation.  It said, “There is no evidence supporting the judge’s implicit finding A2Z was Calix’s employer and therefore no basis upon which the judge could properly award temporary benefits under N.J.S.A. 34:15-15.”  The Court added that this administrative rule “presupposes that a respondent ordered to pay temporary benefits is the petitioner’s employer in the first instance.”

The case is instructive because in today’s workplace it is increasingly common that employees do not always know the identity of their employer.  In this case, petitioner only knew he worked at the address of RNR, which was uninsured and did not even respond to pleadings in the case.  There was no evidence at trial that A2Z was in fact petitioner’s employer; hence, the logic of the administrative rule did not apply.  A2Z was entitled to try the issue of employment, and the burden was on petitioner to prove employment.

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John H. Geaney, Esq., is an Executive Committee Member and a Shareholder in Capehart Scatchard's Workers’ Compensation Group.  Mr. Geaney concentrates his practice in the representation of employers, self-insured companies, third-party administrators, and insurance carriers in workers’ compensation, the Americans with Disabilities Act and Family and Medical Leave Act. Should you have any questions or would like more information, please contact Mr. Geaney at 856.914.2063 or by e‑mail at jgeaney@capehart.com. 

Light duty was the issue in Smith v. DuPage Cnty. Sheriff, 33 AD Cases 789 (N.D. Ill. June 5, 2017).  Four Sheriff’s Deputies suffered work injuries in 2013 and 2014 and received full salary for one year while on leave from their injuries.  After the one-year period, the officers received the statutory amount for temporary disability benefits in Illinois, which was substantially less than their full salary.  The temporary disability benefits constituted two thirds of their regular salary without withholding taxes and pension contributions.   In addition, the County policy required that after 12 weeks of Family and Medical Leave, the employee is responsible for the cost of their entire health insurance premium.   All four officers had to pay the full cost of their health insurance following the 12-week period.

The officers repeatedly sought light duty assignments and contended that the Sheriff’s Office would not even consider their requests.  The Sheriff maintained the jobs of the officers while they were on leave and maintained their seniority but did not offer them light duty.  The officers sued under the Americans with Disabilities Act and argued that the County failed to make reasonable accommodation by denying them light duty assignments that they could have filled and which would have allowed them to regain their full pay and health benefits.  For its part, the County argued that it did in fact accommodate the officers because it maintained their job status and seniority.  Additionally, the County argued that the officers were not disabled under the ADA.

The Court considered 42 U.S.C. 12111 (9) which states that a “reasonable accommodation” includes “job restructuring, part-time or modified work schedules, reassignment to a vacant position.”  Further, the Court noted that the ADA Amendments Act liberalized the definition of disability to include injuries where workers have lifting restrictions along the lines of the plaintiffs’ injuries.  One officer could lift only a maximum of 10 pounds and was unable to bend, stoop, or climb.  Another could lift only 10-25 pounds and was restricted from bending and twisting.  Another had restrictions limiting her from pushing, pulling or grasping more than five pounds.  The Court concluded that there was enough evidence for a jury to determine that the officers were disabled under the ADA.

The evidence was conflicting whether there were in fact vacant light duty position that the officers could fill.  The Court said as follows:

Here, plaintiffs have identified positions which they believed were suitable light duty assignments.  Defendants dispute that positions in R & D  and the warrants division were suitable light duty assignments because they were for civilians and were governed by a separate collective bargaining agreement that restricted deputies in the Law Enforcement Bureau from holding positions in the Corrections Bureau.  However, it appears in the record that there was a light duty policy that did not prohibit employees from working light duty assignments in a different bureau.

The Court also observed that there was evidence that the Sheriff’s Office did not respond to the officers’ requests for light duty and did not engage in the interactive dialogue.  For these reasons, the Court denied summary judgment for the County and permitted plaintiffs to proceed to a jury trial.

The case illustrates a number of important points for workers’ compensation practitioners and employers.  While the EEOC Guidance states that an employer never has to create light duty positions, this is not applicable where an employer already routinely offers light duty assignments.  The question then becomes where there are vacant light duty positions and whether the employer engages in the interactive process.  This case also underscores a point that this practitioner often makes, namely that workers’ compensation cases can often lead to very costly ADA litigation.  Practitioners of workers’ compensation must keep one eye on the compensation case and another on potential employment litigation.

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John H. Geaney, Esq., is an Executive Committee Member and a Shareholder in Capehart Scatchard's Workers’ Compensation Group.  Mr. Geaney concentrates his practice in the representation of employers, self-insured companies, third-party administrators, and insurance carriers in workers’ compensation, the Americans with Disabilities Act and Family and Medical Leave Act. Should you have any questions or would like more information, please contact Mr. Geaney at 856.914.2063 or by e‑mail at jgeaney@capehart.com. 

Occupational psychiatric claims, like all occupational claims, must be filed within time or be subject to the statute of limitations defense.  The challenge is always whether the employer can prove that the employee knew the nature of his condition and its relationship to work.  That was the issue in Bender v. Township of North Bergen, A-1988-15T4 (App. Div. August 25, 2017) where the petitioner, a former police officer with 25 years of experience, filed an occupational psychiatric claim three years after he retired.

Officer Bender worked for the Township from 1979 to 2004 when he retired as a lieutenant.  He testified that over the years he handled various gruesome assignments and suffered negative psychiatric consequences from his exposures.  He consulted with Dr. Ausberto Mckinney, the police department’s physician, in 2002 before petitioner retired.  Dr. Mckinney referred petitioner to a psychiatrist, Dr. Mercedes Rudelli, who began to see him on a continuous basis.  Petitioner testified that the work stress was a factor in his retirement.  However, petitioner did not report the condition to the Township, nor file a claim petition until 2007.  At that point he filed an occupational psychiatric claim and an occupational orthopedic claim.

The Township made a motion to dismiss the case based on the two-year statute of limitations, which requires a claimant in an occupational claim to file within two years from when he knows the nature of the condition and its relationship to work.  The Judge of Compensation ruled in favor of the Township, dismissing both claims.  Petitioner appealed and argued that there was no showing that petitioner knew that his condition was work related until he filed the claim petition.   Petitioner also argued that the Judge of Compensation did not adequately explain why he dismissed the orthopedic claims.

The Appellate Division affirmed the decision of the Judge of Compensation.  First, the Court explained what is not sufficient for an employer to prevail on the occupational statute of limitations.  “As this court has held, merely experiencing symptoms and receiving treatment for a work-related condition is not sufficient to trigger the statutory time limits.” The Court said that the petitioner “must have knowledge that the condition rises to the level of a permanent disability, since only permanent disability is compensable.”

Having said that, the Court found it pivotal that petitioner himself testified that he was aware as early as 2002 of the relationship between his psychological symptoms and his employment.  That was why he was treating with a psychiatrist. Petitioner had also filed claims in the past for various injuries, and the Court noted that petitioner was familiar with the workers’ compensation process.

Petitioner made a clever attempt to argue that the Township was aware that he was treating with its physician, who referred petitioner to a psychiatrist, and therefore the Township was actually in effect providing workers’ compensation treatment through Dr. Rudelli, even though it was not being billed through workers’ compensation.  He argued that the two-year statutory period should therefore be tolled.  The Court did not buy that argument, stating that petitioner was well aware from filing prior workers’ compensation claims of the requirement to file a formal, written claim petition in a timely fashion.

Where the Appellate Division did agree with petitioner was that there was not sufficient rationale for a dismissal of the occupational claim petition.  Petitioner argued that his orthopedic injuries were “insidiously progressive” and “did not manifest themselves until less than two years before the filing of the claim petition.”  The Appellate Division remanded this part of the case for further proofs on the issue of the statute of limitations on the orthopedic claims.

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John H. Geaney, Esq., is an Executive Committee Member and a Shareholder in Capehart Scatchard's Workers’ Compensation Group.  Mr. Geaney concentrates his practice in the representation of employers, self-insured companies, third-party administrators, and insurance carriers in workers’ compensation, the Americans with Disabilities Act and Family and Medical Leave Act. Should you have any questions or would like more information, please contact Mr. Geaney at 856.914.2063 or by e‑mail at jgeaney@capehart.com. 

Cases involving temporary staffing agencies and professional employer organizations often lead to unusual and complex legal issues in workers’ compensation.  The recent case of Detres v. Workforce Logistics Corp., A-4963-15T1 (App. Div. August 25, 2017) illustrates this point quite well by delving deeply into coverage and conflicts of law issues in a very high exposure claim.

On October 18, 2013, Carlos Ariel Detres was injured seriously when struck by a truck while working for Buy Wise, which specialized in automotive parts distribution.   He was a temporary worker provided by Workforce Logistics Corporation to Buy Wise.  Detres was a New Jersey resident and was injured at the Buy Wise location in Jersey City.  Detres filed a workers’ compensation claim against both Buy Wise and Workforce Logistics Corporation.  Workforce, which was insured in New York by Public Service Mutual Insurance Company, denied that the injury occurred in the course of employment.  Its carrier,  Public Service Mutual Insurance Company, asserted that its policy only applied to New York State locations.  Buy Wise, which was insured by Hanover Insurance in New Jersey, denied that its policy applied to this accident, and pointed at Public Service.

How this tangled mess occurred went back to April 23, 2013 when Workforce applied for workers’ compensation coverage to Public Service.  The application only listed two locations in New York and never mentioned locations in New Jersey.  The application also said that no employees “travel out of state” or “perform work for other businesses or subsidiaries,” and that Workforce did not “lease employees to or from other employers.”  Relying on these representations, Public Service issued the workers’ compensation policy from May 1, 2013 to May 1, 2014.  Under the policy conditions, only the workplaces and locations listed in the policy were covered, and there was language that there was no “duty to defend a claim, proceeding, or suit that was not covered.”  It also said that New York law should apply.

The Judge of Compensation heard a great deal of complex testimony regarding the applicable policies.  One key fact was that an agent for Workforce – after the accident with Detres – -sent an email to an Office Manager with Workforce, informing him that there was no coverage for any New Jersey locations. Workforce’s agent was concerned about other potential claims in New Jersey and suggested that the New Jersey location should be added to the policy.  Eventually there was a request to add two New Jersey locations to Workforce’s workers’ compensation coverage effective December 16, 2013, which was several months after the accident to Detres. The premium more than doubled, and the policy was supposed to start December 16, 2013.  However, the amended policy actually listed the same period as the original policy, namely May 1, 2013 to May 1, 2014 (during which time petitioner had his accident). There was no language limiting the effective date of the New Jersey locations to December 16, 2013.

In December 2015, Hanover Insurance and Buy Wise moved for a judgment that coverage must be provided either by Public Service or by the New Jersey Uninsured Employers’ Fund.  The Judge of Compensation eventually ruled that Public Service had to provide coverage for Detres’s injury as well as providing legal representation for Workforce.  The Judge focused on the fact that the New Jersey locations had been added and that they became part of the original policy dating back to May 1, 2013.

Public Service appealed and argued in part that New York law should be applied, and that the amendment to the policy in January 2014 should not be given retroactive effect.  Public Service also argued that Workforce made several material misrepresentations to obtain coverage and therefore should not be given coverage.

The Appellate Division affirmed the decision of the Judge of Compensation on all points.  The Court focused on the fact that the amendment to the policy adding two New Jersey locations was included in the original policy beginning on May 1, 2013.  While Public Service produced emails showing that the amendment was only supposed to take effect in December 2013 (after the work accident), the Court said that the policy was clear and unambiguous in stating that it began on May 1, 2013.  The Court also rejected the argument that Hanover Insurance, which insured Buy Wise at the New Jersey locations, should pay the claim.

The Court reviewed a little known provision on the New Jersey Workers’ Compensation Act, N.J.S.A. 34:15-87, which states that if an insurer wants to restrict liability of the insurer to a specific location, it must ensure that there is concurrent separate insurance for other locations.  The Court read this provision as meaning that Public Service was required to provide coverage to New Jersey’s locations.  The Court relied on Lohmeyer v. Frontier Ins. Co., 294 N.J. Super. 547 (App. Div. 1996), certif. denied, 148 N.J. 461 (1997).  That case held that a trainer thrown from a horse was entitled to coverage even though the stable where he worked was not specified in the stable’s workers’ compensation policy.

Public Service next raised potential fraud by its insured, Workforce, as a defense.  It argued that Workforce misrepresented that it only did business in New York.  The Court accepted that there were misrepresentations but said that there is no defense to coverage simply because the insured made untrue statements to the carrier.

Lastly, the Court rejected the argument that New York law should apply, not New Jersey law.  The Court began by noting that ordinarily the choice of law made by the parties in a contract is followed, unless some other state has a more significant relationship.  The Court also observed that New York law allows a workers’ compensation carrier to exclude specific locations from a policy, but New Jersey law does not.  In the end, the Court felt that New Jersey had a greater interest in resolving the dispute than New York because petitioner resides in New Jersey and was injured in New Jersey.  “While we acknowledge that two New York corporations entered into a contract for workers’ compensation insurance coverage, and the original policy applied only to the New York locations, we are satisfied that application of New York law would be contrary to the fundamental policies and protections of New Jersey’s Workers’ Compensation Law.”  The Court said that New Jersey had a strong interest in ensuring that an employer and its carrier cannot exclude certain locations from coverage.

The Court added, “Although both Workforce and Public Service are New York corporations, they purposefully availed themselves of New Jersey law by doing business in New Jersey and contracting for workers’ compensation coverage of a New Jersey location.”

One question left unanswered is what would have happened if the Public Service policy amendment had correctly stated that its policy covering the two New Jersey locations had been changed to reflect the commencement date of December 2013.  That may have made a significant difference to the Appellate Division.   It is likely that it was an oversight to issue the amended policy using the same original policy dates, but in the end the Court held the carrier to the language of its policy.

The case is also helpful in realizing that misrepresentations by an insured to its carrier will not exculpate the carrier when a worker is injured.  There may be civil remedies against the insured, but an employee is entitled to workers’ compensation benefits because the employee had nothing to do with the misrepresentations.

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John H. Geaney, Esq., is an Executive Committee Member and a Shareholder in Capehart Scatchard's Workers’ Compensation Group.  Mr. Geaney concentrates his practice in the representation of employers, self-insured companies, third-party administrators, and insurance carriers in workers’ compensation, the Americans with Disabilities Act and Family and Medical Leave Act. Should you have any questions or would like more information, please contact Mr. Geaney at 856.914.2063 or by e‑mail at jgeaney@capehart.com. 

In University Physicians Associates v. Transport Drivers, Inc., A-3350-15T2 (App. Div. August 22, 2017), the Appellate Division considered an argument that Level I and II Trauma Centers should be given different treatment when it comes to billing along the lines that they receive under the fee schedule for No-Fault automobile policies.

The case stemmed from an accident that took place on October 10, 2012 when a pallet dropped from a forklift and seriously injured Manuel Bonilla, a Transport employee.  Bonilla was taken by ambulance to University Hospital, which is a Level 1 trauma center in Newark, N.J.  There Dr. David Livingston, a general surgeon, performed a hip relocation procedure under conscious sedation.  Two days later, Dr. Mark Adams, an orthopedic surgeon, performed an open reduction and internal fixation under general anesthesia to repair an acetabular fracture.  Dr. Livingston billed $10,343 for his services ($952 for a consultation and $9391 for the hip relocation), and Dr. Adams billed $71,374 for his services.

Respondent’s workers’ compensation carrier paid for $3,688.98 for the services of Dr. Livingston and $24,234.50 for the services of Dr. Adams.  The doctors had billed at the 95^th percentile (meaning that on a scale of 100, only five doctors billed more for charges which prevail in the same community).  The carrier reimbursed at the 75^th percentile, which means they paid at a level that was higher than 75 of 100 doctors for charges which prevail in the same community.

The litigation began in the Division of Workers’ Compensation with a Medical Claim Petition, but unlike 99% of such claims which normally settle, this case went to trial.  Dr. Livingston and the hospital CFO testified.  Respondent produced a Certified Coder on its behalf.  The Judge of Compensation, The Honorable Nilda Hernandez, found for the carrier and dismissed the claim petition.  University Physicians Associates appealed.

The Appellate Division noted that the Judge of Compensation expressed a valid rationale for her decision because respondent’s witness, Sandra Corradi, was the vice president of a bill review company retained by respondent’s insurer.  She was truly an expert in coding and said that the industry standard of reimbursement is paid at the seventy-fifth percentile as indexed by FAIR Health for New Jersey.  The Judge of Compensation noted that Dr. Livingston and the CEO were not expert coders.   They did not provide data on what they were paid by Medicare or other systems.

The Appellate Division found the expertise of the coder to be compelling but also addressed the central argument of the University Physicians Associates, namely that the Court should follow No-Fault regulations which exempt trauma services at Level I and II from its fee schedule.   One of the problems with this argument is that workers’ compensation has no fee schedule to begin with in New Jersey.   The Appellate Division also observed that even if the No-Fault law contains this exemption, all charges by Level 1 and II trauma hospitals must still be proven to be usual, customary and reasonable.

In this case, the Appellate Division affirmed the Judge of Compensation “[b]ecause the judge based her determination upon the usual fees and charges that prevail in New Jersey for similar physicians’ and surgeons’ services.”  The Appellate Division arguably did all parties a favor by so ruling, including hospitals.  To do otherwise would have discouraged the use of Level I and II trauma centers as there would be very little predictability on costs if employers and carriers had to devise a completely different repricing approach for such centers.

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John H. Geaney, Esq., is an Executive Committee Member and a Shareholder in Capehart Scatchard's Workers’ Compensation Group.  Mr. Geaney concentrates his practice in the representation of employers, self-insured companies, third-party administrators, and insurance carriers in workers’ compensation, the Americans with Disabilities Act and Family and Medical Leave Act. Should you have any questions or would like more information, please contact Mr. Geaney at 856.914.2063 or by e‑mail at jgeaney@capehart.com. 

Last week I wrote about how employers should not handle reopener claims, namely trying them on reports without expert testimony.  The case of Kalucki v. United Parcel Service, A-3486-15T3 (App. Div. August 15, 2017) demonstrates the winning strategy for employers to adopt in reopener claims.

The case involved an injury that took place many years ago to petitioner, who was a clerical worker for UPS.  The most recent reopener award took place on June 24, 2009.  Petitioner received two separate awards of disability.  In one claim he received an award of 40% permanent partial disability for the left shoulder and neck subject to a credit of 37.5% for a prior compensation award.  In the other claim petitioner received 17.5% of partial total for bilateral carpal tunnel syndrome subject to a credit of 15% for a prior carpal tunnel award.  The petitioner then reopened both awards seeking an increase in both cases.

Petitioner testified at trial that his left shoulder and neck were more restricted, and it was painful to move his neck from side to side.  He said he had problems laying on his left side.  He experienced shoulder aches and numbness.  He also said that he lost grip strength in his left hand.

Both parties brought in experts to testify.  Petitioner’s expert had examined him four times in the past.  This expert was not a board certified orthopedic physician.  The expert found tenderness and spasm in the left shoulder, limited range of motion, and tenderness in the wrists.  The expert increased his estimate by 25% of the right hand, 25% of the left hand, and 30% in the neck.  The overall disability estimates, when combined, exceeded 100%.

Respondent produced a board certified orthopedic physician who had examined petitioner once before in 2007.  Respondent’s physician actually ordered an x-ray of the shoulder and found no objective findings of any significant pathology in the shoulder or changes in the neck.  In fact, the orthopedist said that petitioner’s range of motion had improved from the time of the last exam.  Overall petitioner had no increased disability with respect to the shoulder, neck or bilateral carpal tunnel.  The expert did concede negative grip strength in the right hand, but he found no atrophy and no decreased sensation.

The Judge of Compensation ruled that there was no objective evidence of increased disability and dismissed the reopeners on the neck, shoulder and hands.  He noted that the only evidence petitioner produced was subjective complaints.  That did not meet the standard of Perez v. Pantasote, 95 N.J. 105 (1984).  Significantly, the Judge observed that petitioner had not seen a doctor or received any treatment since the time of the last award.  Further, petitioner was able to continue to perform his full-duty job without the need of any accommodations. Finally, the Judge stated that respondent’s expert was more qualified than petitioner’s expert.  The Judge was critical of the petitioner’s expert: “The Court finds that claimant’s expert’s finding of an over 100 percent disability when combined, does not ring true based on petitioner’s continued full-duty employment.”

Petitioner appealed the dismissal of the reopeners and argued that the Judge should not have given greater weight to respondent’s doctor based on credentials.  The Appellate Division disagreed and ruled that it was entirely appropriate for the Judge of Compensation to consider the added credentials of the respondent’s doctor, based on his Board Certification, as a factor in credibility of the experts.  The Appellate Division also commented that much of petitioner’s testimony at trial on this reopener was exactly the same as what he testified to at the time of the prior award. The Appellate Division said,  “As just one example, claimant’s expert testified that petitioner’s range of motion in his neck on examination in 2011 was limited by twenty degrees, as compared with a higher limitation of twenty-five percent revealed on examination in 2007.”  Finally, the Court commented that petitioner continued to work full-time and never even saw a physician for treatment since the time of the prior award, taking only over-the-counter medications since then.

For these reasons the Appellate Division affirmed the Judge of Compensation’s dismissal of these claims.  The case illustrates the proper way to handle a reopener claim.  Respondent did everything right here, retaining a board certified orthopedic physician, comparing the complaints with those at the time of the prior settlement, and emphasizing the lack of objective evidence produced by petitioner.   This case provides a textbook case on how reopener claims can be won by employers when handled wisely.

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John H. Geaney, Esq., is an Executive Committee Member and a Shareholder in Capehart Scatchard's Workers’ Compensation Group.  Mr. Geaney concentrates his practice in the representation of employers, self-insured companies, third-party administrators, and insurance carriers in workers’ compensation, the Americans with Disabilities Act and Family and Medical Leave Act. Should you have any questions or would like more information, please contact Mr. Geaney at 856.914.2063 or by e‑mail at jgeaney@capehart.com. 

The best defense against an occupational disease claim is often the statute of limitations.  That is how the employer won in Mara v. United Parcel Service, A-3691-15T4 (App. Div. August 4, 2017).

The case involved a package car driver named Craig Mara who began working for UPS in 1983.  He filed a claim petition in 2011 contending that his bilateral knee replacement surgery in 2010 was caused by decades of physical stressors on the job.  He argued that he did not realize his knee condition was work related until after he had his surgery, and since he filed within two years of the surgery date, he argued that his filing was timely.

UPS countered with evidence that Mara knew his condition was related to his work in 2006.  Mara had long-standing knee problems, including prior left knee surgery 10 years before he testified.  His personal chiropractor, Dr. Ruth, had been treating Mara for knee pain since 2003 and told him that his condition was work related in 2006.  He admitted in his testimony that he revealed to Dr. Ruth that driving at work and moving around at work caused him knee pain.  He also told Dr. Ruth that his right knee was hurting due to work activities.

The Judge of Compensation found that petitioner’s claim was not timely filed, and the Appellate Division affirmed.  The Court said, “Considerably more than two years prior to his 2011 petition, Mara was well aware that the problems in both his knees were work-related.  Long before the 2010 knee replacements, the problem with at least one knee was sufficiently severe as to require surgery to repair a torn meniscus.”

The Court also rejected petitioner’s alternative argument that his employer lulled him into believing that his knee condition was work related by having the surgery paid for by employer sponsored health insurance.  The Judge of Compensation correctly pointed out that the employer’s health insurance was separate and distinct from its workers’ compensation policy.

The case makes sense because it directly falls within the language of N.J.S.A. 34:15-34, which requires that a compensation petition must be filed “within 2 years after the date on which the claimant first knew the nature of the disability and its relation to the employment.”  The defense was able to show both elements:  that the petitioner knew the nature of his disability and thought the condition was work related.  UPS was able to prove the defense through prior medical records, particularly prior chiropractic records.  It is absolutely essential in occupational orthopedic claims that employers obtain prior chiropractic, family doctor and prior orthopedic treatment records because those records often build the entire defense to the claim, just as in this matter.