H&W New York Workers' Compensation Defense Newsletter
Vol. 2, Issue 1

• Board Panel Steps Back from Delta Airlines Rule in New Labor Market Attachment Decision
• Don't Ignore Loss Transfer Opportunities in MVA Claims
• Stay Tuned – New SLU Guidelines Are Coming!
• Contact Us

On August 7, 2017, a new Board Panel Decision, Barbella Environmental Tech., WCB #G0796969 (Aug. 7. 2017) introduced a change in the law on labor market attachment by backing away from the rule created by the Board Panel decision inDelta Airlines and the Full Board decision in Cranesville Block which allows claimants who were still employed by the employer of record to be found attached to the labor market without the need to produce proof of same as required by theAmerican Axle decision. The Board Panel in Barbella was split, with Commissioners Ausili and Hull in the majority and Commissioner Levelt in dissent. The split decision gives the claimant an appeal by right to the Full Board. The majority opinion outlined a two-pronged test for claimants who remain “on-the-books” at the employer of record, rather than applying a conclusive presumption that those claimants are attached. 
 
The new test has two elements:
 

1. Does the Board file contain objective medical evidence that the claimant can return to work with the employer?
2. Does the claimant have a realistic expectation to return to work with the employer?

 
If the answer to both questions is yes, then the claimant is attached to the labor market.  If the answer to one or both questions is no, then the claimant needs to satisfy the requirements ofAmerican Axle to prove labor market attachment. This rule will apply only to claimants during a period of temporary disability because the 2017 statutory changes to §15(3)(w) provide that permanently partially disabled claimants entitled to benefits at the time of classification no longer need to demonstrate ongoing attachment to the labor market.
 
The majority said that the claimant inBarbella, a union member who was partially disabled and potentially pending surgery, did not have objective medical evidence that he could return to work for the employer. Thus, he did not have a reasonable expectation to return to work and perform his essential job functions. The claimant also did not meet the requirements for labor market attachment outlined inAmerican Axle, so his awards were rescinded until he proved reattachment to the labor market.

This new rule gives carriers and employers another tool to limit indemnity liability during the period of temporary disability. We expect that the claimant will take the case to the Full Board and we’ll plan to report on that decision when it becomes available. 

Workers' Compensation claims arising from motor vehicle accidents (MVAs) present complex legal issues for claims handlers. Many of these claims involve a third-party action filed by the claimant against a negligent driver involved in the accident. Most claims professionals know that when a MVA involving two “covered persons” occurs in New York State, there is no workers’ compensation lien for payments made in lieu of “first party benefits” as defined by the New York No-Fault Law.  The workers’ compensation carrier or self-insured employer (SIE) has lien and offset rights only for payments deemed outside the definition of “first party benefits”. Payments outside of "first party benefits" include: 1) combined payments of medical, indemnity and no-fault in excess of $50,000.00; 2) indemnity payments in excess of $2,000.00 per month; or 3) indemnity payments for lost time occurring after three years from the MVA. 
 
Loss Transfer Arbitration allows the carrier or SIE to recover payments made in lieu of "first party benefits" even though the carrier or SIE does not have a lien against the third party recovery for those payments. Loss Transfer applies only in cases where at least one of the vehicles involved in an accident is used principally for the transportation of persons or property for hire or weighs in excess of 6500 pounds unloaded. In these cases, the carrier or SIE can pursue recovery up to $50,000.00 against the automobile carrier for the negligent party. 
 
Hamberger & Weiss handles Loss Transfer claims and Arbitration hearings across the state, as those hearings are now conducted via teleconference. Over the past 5 years, we have recovered nearly $5,000,000 in Loss Transfer reimbursement for our clients.
 
We also prepare third party consent letters associated with the settlement of the bodily injury claim. Although Loss Transfer and third party actions are separate legal matters there are overlapping legal issues that intertwine your lien, credit and Loss Transfer recoveries. Involving expert counsel in third party cases will maximize your Loss Transfer recovery and protect your consent, lien and credit/offset rights in the third party action.  Please contact Dan Bowers of our Loss Transfer practice group for assistance in these cases. For advice in regard to third party settlements generally, please contactRon Weiss, Susan Duffy, or Dan Bowers.

The 2017 Workers’ Compensation reform law (Part NNN of Chapter 59, Laws of 2017) requires the Board, in consultation with representatives of labor and business, to develop new permanency impairment guidelines concerning SLU findings by 9/1/17 for implementation on 1/1/18. The Board is reportedly on schedule to issue the proposed SLU Guidelines on 9/1/17. We will present our analysis of the proposed Guidelines as soon as possible after they are published.

Hamberger & Weiss - Buffalo Office
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Buffalo, NY 14202
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Hamberger & Weiss - Rochester Office
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Rochester, NY 14614
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H&W New York Workers' Compensation Defense Newsletter
Vol. 1, Issue 12

• CMS Expands WCMSA Re-Review Process to Allow Submission of New Evidence
• Board Clarifies Law on Attachment to Labor Market, Provides New Forms in July 2017 Subject Number
• Appellate Division Rules that Section 15(3)(v) Awards Subject to Same Cap on Benefits as 15(3)(w) Awards
• WCB Chairman Munnelly Announces His Retirement
• Contact Us

Traditionally, the submission of a WCMSA to CMS was a one-shot affair. Once the parties received a WCMSA approval letter from CMS, the set-aside amount indicated in the letter was not subject to re-review unless CMS made an obvious mistake of fact or evidence that pre-dated the original submission that was not included in that submission was discovered. Except for these narrow circumstances, CMS would not consider newly submitted evidence in a request for re-review of a previously determined WCMSA.
 
With the publication of its latest WCMASP User Guide, Version 5.1 (7/10/17), CMS has expanded its re-review process to include what it callsAmended Review. This will allow the parties to a workers' compensation settlement to submit new medical evidence to CMS, even after receipt of the WCMSA approval letter from CMS, subject to certain limitations described below. Why would someone want to do this? Amended review would allow the parties to apply for a lower WCMSA than that approved by CMS if new medical evidence supported the request. For example, if CMS included lifetime use of opioid medication in its WCMSA approval letter, but subsequent to the issuance of the approval letter the claimant weaned from the prior medications, the parties can submit medical evidence showing the successful weaning and apply to CMS for approval of a lower set-aside amount.
 
Amended Review is not without its limitations, however. Cases subject to Amended Review are subject to the following parameters:
 
1) The original submission of the WCMSA for pre-settlement approval was submitted 1 to 4 years from the date of the requested re-review;
 
2) Only one Amended Review request can be made per case. If Amended Review is denied, another cannot be requested; and
 
3) The new proposed WCMSA must differ from the original approved WCMSA amount by 10% or $10,000, whichever is greater.
 
The Amended Review process will allow parties to reconsider settlement of claims previously thought too expensive to settle due to a high WCMSA approved by CMS, assuming medical evidence exists to support the request for a lower WCMSA. For assistance in reviewing a case for potential Amended Review by CMS or for an initial WCMSA submission to CMS, please do not hesitate to contact one of our Statewide MSA/Section 32 Department leaders, Dan Bowers, Joe DeCoursey, or Nicole Graci.

Subject Number 046-958 provides an outline of the Board’s current interpretation of the state-of-the-law on labor market attachment. The Subject Number leads by noting that the "only significant recent change" in the Workers' Compensation Law with respect to labor market attachment arose from Part NNN of Chapter 59, Laws of 2017, Subpart A, which among other things amended WCL Section 15(3)(w) to eliminate the need for claimants found entitled to benefits at the time of classification to demonstrate ongoing attachment to the labor market. The Board is careful to note that temporarily partially disabled claimants and those claimantsnot attached to the labor (or otherwise not entitled to benefits) at the time of classification remain obligated to demonstrate their attachment to the labor market. 
 
The Subject Number reminds readers that claimants can demonstrate labor market attachment by adhering to the now familiar American Axle standard that has been the state of the law since 2010. The Board recognizes that many job applications are completed online via email or internet submission and permits modification of the American Axle standard under the Suffolk County Health Services case to allow for this. Most importantly, the Subject Number warns claimants that an independent job search must be "timely, diligent, and persistent." Moreover, a claimant engaged in other attachment to the labor market efforts such as use of a One-Stop career center must provide documentation showing the claimant's "active participation" in these efforts. 
 
To assist claimants in documenting their attachment to the labor market efforts, the Board has issued a revised C-258 form and introduced a new form, the C-258.1. The C-258 form now allows claimants to enter information about other attachment efforts such as participation at a One-Stop career center, rehabilitation or retraining efforts, and attendance at an accredited educational institution. Claimants seeking to prove labor market attachment through an independent job search are directed to use the new C-258.1 form, which provides more direction and space for claimants to produce the information required by theAmerican Axle decision in detailing their independent job search efforts. 
 
The Board also provides a reminder in the Subject Number that although a claimant found entitled to benefits at the time of classification need not produce proof of attachment to the labor market, there can remain a question as to whether the claimant's disability was the reason why the claimant ceased full-time work. In citing to theLauner and Smith cases, the Board is suggesting that employers and carriers look carefully at the reasons for a claimant's reduction in earnings before accepting reduced earnings awards. However, the claimants inSmith and Launer were done in by their own testimony, which may prove difficult to obtain given the Board's stinginess with re-openings on classified claims. 
 
The Board’s comments here should also serve as a reminder that although a claimant found entitled to benefits at the time of classification need not demonstrate ongoing labor market attachment, we believe that the defense of voluntary withdrawal from the labor market remains available for employers and carriers to pursue. We would recommend reading our article from our May 2017 newsletter for recommendations on how to pursue the voluntary withdrawal defense after classification. In short, employers and carriers will need to compile evidence not unlike that which was used in the past to seek a re-opening of claims following classification such as questionnaires sent to the claimant asking if the claimant was looking for work, offers of vocational services, job leads sent to the claimant, and the results of follow up on those leads.
 
We believe that the Subject Number will prove useful in day-to-day litigation on labor market attachment issues in temporary disability cases. This Subject Number is in alignment with the position we have been taking since theAmerican Axle decision regarding claimant's requirements for proving labor market attachment and will provide a further point of authority to direct WCLJs and the claimant's bar in arguments over labor market attachment.
 
If you have any questions about the defense of labor market attachment or interpretation of this Subject Number, please do not hesitate to contact any ofour attorneys.

On 6/29/17, the Appellate Division, Third Department, decided Mancini v. Office of Children and Family Services. This decision is notable for two reasons. First, the court explicitly held that payments under WCL §15(3)(v) are subject to the statutory cap on awards set forth in WCL §15(3)(w). A loss of wage earning capacity (LWEC) finding must be made by the Board, as in classification cases, to set the length of the capped awards.  Second, the court affirmed a finding by the Board that the cap on §15(3)(v) awards does not begin until the date when the Board makes a LWEC finding, rather than the date on which claimant’s schedule loss of use award allocation ends. 
 
For context, WCL §15(3)(v) allows claimants with a greater than 50% schedule loss of use award for certain injuries to request additional payments after the schedule loss of use award allocation expires. Claimants seeking §15(3)(v) awards must prove compliance with various criteria. The language of §15(3)(v) specifically references WCL §15(3)(w) for payment of the additional benefits. For quite some time, our office has taken the position that this means benefits under WCL §15(3)(v) should be capped, and the Court has now confirmed this.

The two takeaways from this decision are that WCL §15(3)(v) awards are subject to the statutory caps in WCL §15(3)(w), and the cap on awards begins effective the date of the loss of wage earning capacity finding by the Board once a claimant makes a successful §15(3)(v) claim.

At the July 2017 meeting of the Commissioners of the Workers’ Compensation Board, Chairman Kenneth J. Munnelly announced that he would be retiring from the Board in September. As of this writing, we have no information regarding whom the Governor may appoint to replace him as Chair.

Hamberger & Weiss - Buffalo Office
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Buffalo, NY 14202
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H&W New York Workers' Compensation Defense Newsletter
Vol. 1, Issue 11

• Board Rules that Medical Treatment Guidelines Apply to Out-of-State Treatment
• Board Issues New C-240: Employer’s Statement of Wage Earnings Form
• Appellate Division Clarifies Calculation of End Date of Carrier’s “Holiday” Credit in Third-Party Action Cases
• Appellate Division Allows Claimant to Receive Two 100% SLU Awards for the Same Injury
• Contact Us

In Hospice, Inc. (WCB Case No. 5951 3410, 5/24/17), a Board Panel ruled that the New York State Medical Treatment Guidelines (“MTGs”) apply to treatment rendered to a claimant residing out-of-state by an out-of-state provider. This represents a significant departure by the Board from its prior decisions on this issue.

The claimant in Hospice lived in Nevada and sought treatment from a Nevada provider. The carrier filed a C-8.1B to the bill for this treatment, arguing that the treatment provided was not based upon a correct application of the MTGs because the provider billed for medications not approved under the MTGs. The WCLJ found the C-8.1B in favor of the provider and the carrier filed an Application for Board Review.

The Board reversed and ruled in the carrier’s favor, noting that even though it previously held that a nonresident claimant seeking treatment out-of-state was not bound by the MTGs, it was now disavowing and departing from such prior Board Panel decisions and ruling that the MTGs apply regardless of where or by whom the treatment is rendered. The Board’s decision was based on its reading of the Court of Appeals decision inKigin v. State of New York Worker’s Compensation Board, 24 N.Y.3d 459 (2014).

The Board also held that the variance process applies to out-of-state providers but that out-of-state providers are not required to use the Board’s forms (i.e, MG-1, MG-2 and C-4AUTH). Use of the forms is preferred but not a basis to deny treatment.

On 6/19/17, the Board issued Subject Number 046-949, which introduced a substantially revisedC-240 form (Employer’s Statement of Wage Earnings) to the workers’ compensation community. The Subject Number provided additional guidance regarding the phrase “a substantial part of the year” in determining whether a similar worker payroll should be used. Significantly, the Subject Number and new C-240 form suggest that it is now permissible for an employer to attach payroll information in lieu of completing the payroll tables on the second page of the form.

On 6/1/17, the Appellate Division, Third Department, decided Lala v. Site Works Contracting Corp. At issue was how the end date for a carrier’s third-party action holiday should be calculated for cases involvingBurns payments for the carrier’s equitably apportioned share of the third-party action litigation expenses.

The claimant inLala settled his third-party action for $100,000.00 on 3/11/11.  He received a net recovery of $64,541.51.  The Board awarded him $500.00 per week for indemnity.  Of that amount, 35.46% ($177.30 per week) constituted the carrier’sBurns payment, with the remaining $322.70 directly credited to the third-party action holiday.

The Board held that the credit expired on 8/20/13. In calculating this date, the WCLJ used the $322.70 portion of the carrier’ credit and also the $177.30 Burns payment, meaning the full $500.00 per week was deducted from the $64,541.51 credit. On appeal to the Appellate Division, the carrier argued that only its $322.70 per week share should be deducted from the credit and that the $177.30 per week Burns payment should not be deducted from the credit. If this method were used, its credit would not expire until 1/6/15. The claimant and the Board argued that the full $500.00 per week should be deducted from the credit when calculating the exhaustion date.

Citing Kelly v. State Insurance Fund, Burns v. Varriale, and Stenson v. New York State Department of Transportation, the Appellate Division held that in the absence of a specific provision to the contrary in the carrier’s settlement consent letter, the appropriate manner for calculating the credit exhaustion is to include both the amount ofBurns payment and the carrier’s share of the awards in the weekly deductions from the net third-party action recovery when indemnity awards are payable to the claimant. In other words, the appropriate deduction from the carrier’s credit was $500.00 per week, not $322.70 per week. The Court explained that under the Court of Appeals precedent governing equitable apportionment of third-party action litigation expenses, the carrier’s share of litigation expenses is based on the total benefit derived from the third-party action recovery. Because Burns payments are a pay-as-you-go method of repaying the claimant’s third-party action litigation expenses, allowing the carrier to deduct only its weekly share of the net recovery from the amount of the third-party action credit would create a double recovery to the carrier because the Burns payments are supposed to reimburse the claimant for the costs incurred in obtaining the third-party action recovery.

The Appellate Division’s use of the phrase “in the absence of a specific provision to the contrary” should serve as a reminder to all parties of the importance of careful drafting of consent letters to third-party settlements due to the scrutiny given to them by the Board and the Courts.

On 5/25/17, the Appellate Division, Third Department decided Deck v. Dorr, holding that a claimant can receive a 100% schedule loss of use award for the thumb and a separate 100% schedule loss of use award for the same hand at the same time as long as there are distinct separate injuries to the thumb and the rest of claimant’s fingers.

Claimant lost all four fingers when his hand became stuck in a meat grinder.  The grinder also amputated his thumb, but doctors were able to reattach a portion of the thumb to his hand.  The thumb was half the size of claimant’s thumb on the opposite hand and had no pinching ability.  The parties stipulated to a 100% schedule loss of use award for the hand based on claimant’s loss of all four fingers, and litigated claimant’s eligibility for a separate 100% schedule loss of use award for the thumb.  Uncontradicted medical testimony stated that the Disability Guidelines allow for more than 100% loss of use for a hand under certain circumstances.  The Board awarded claimant the 100% loss of use for his hand and a separate 100% loss of use for the thumb, stating that claimant sustained distinct injuries to his four fingers and his thumb, and that the separate injuries had differing impacts on the functionality of his hand.  Based on this, the Board concluded that distinct loss of use awards for the four fingers (which translates into a 100% loss of use of the hand), and the thumb was appropriate.

On appeal, the carrier argued that the injuries to the fingers and thumb should be subsumed into a 100% schedule loss of use for the hand with no additional award. The Court disagreed, citing precedent from the New York State Court of Appeals, New York’s highest appellate court, and Appellate Division precedent holding that when a claimant has multiple injuries to different parts of the hand, the schedule loss of use award is not limited to 100% of the hand. The Court highlighted the fact that the Disability Guidelines treat the fingers and thumbs separately for schedule loss of use award analysis. The Court also highlighted the uncontradicted medical testimony that the Guidelines contemplate a greater than 100% loss of use for the hand under certain circumstances.

The take-away from the case is that when a claimant has multiple injuries to different parts of a hand, separate schedule loss of use awards can be awarded for those distinct injuries.

Hamberger & Weiss - Buffalo Office
700 Main Place Tower
350 Main Street
Buffalo, NY 14202
716-852-5200
buffalo@hwcomp.com

Hamberger & Weiss - Rochester Office
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Rochester, NY 14614
585-262-6390
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H&W New York Workers' Compensation Defense Newsletter
Vol. 1, Issue 10

• The Attachment to the Labor Market Defense for PPD Claimants After the 2017 Reforms
• Appellate Division Decision Clarifies Issues Concerning Attachment to the Labor Market Defense
• Appellate Division Rules That Section 25-a Applies to Death Claims Resulting from Claim Already Transferred to SFCC Prior to 1/1/14
• H&W Obtains Favorable Decision on Drug Weaning from Board Panel, Reversing WCLJ
• Contact Us

Although the April 2017 amendment to the Workers’ Compensation Law has eliminated the need for some permanently partially disabled (PPD) claimants to demonstrate ongoing attachment the labor market, we submit that this does not mean that carriers are without means to seek a suspension of benefits following classification. Recall that WCL Section 15(3)(w) was amended to read, in pertinent part, as follows:
 

Compensation under this paragraph shall be payable during a continuance of such permanent partial disability,without the necessity for the claimant who is entitled to benefits at the time of classification to demonstrate ongoing attachment to the labor market

 
The curious situation created by this amendment is that although the claimant still must maintain an attachment to the labor market following classification with a permanent partial disability, the claimant no longer needs to prove it. Although the claimant’s burden to demonstrate attachment has been lifted, this does not prevent the carrier from arguing that the claimant has voluntarily withdrawn from the labor market.
 
Before the 2017 amendment to Section 15(3)(w), the Board repeatedly stated in its decisions addressing requests to reopen claims post-classification that “attachment to the labor market and voluntary withdrawal from the labor market are two different legal concepts,”Combined Life Insurance Co., WCB Case No. 806012674 (decided 4/9/15). Attachment to the labor market is an ongoing issue, which the claimant must continually maintain and prove to be entitled to benefits. Voluntary withdrawal from the labor market applies to a specific point in time and must be proven by substantial evidence. Curtis v. Dale Pipery Corp., 295 A.D.2d 836 (3d Dep’t 2002).  For example, if a claimant quits employment for reasons unrelated to the injury or refuses a light-duty job offer within that claimant’s work restrictions made in good faith, that claimant has voluntarily withdrawn from the labor market, and must prove attachment thereafter to maintain an entitlement to benefits. Moreover, if a claimant does not look for work, or otherwise fails to maintain an attachment to the labor market, that claimant can be found voluntarily withdrawn from the labor market. German v. Target Corp. 77 A.D.3d 1126 (3d Dept. 2010);see also, Buffalo Bd. Of Education, 2013 WL 1007427 (WCB Case No. 80208789, decided March 6, 2013).

The amendment to Section 15(3)(w) makes no reference to the voluntary withdrawal defense. This defense should still be available to carriers even after classification. A condition precedent to a finding of voluntary withdrawal is a prior attachment to the labor market. If the carrier can submit sufficient evidence that the claimant is no longer engaged in the activity that gave rise to the claimant’s earlier attachment to the labor market (e.g., the claimant is no longer employed, or going to school, or retraining, or looking for work) then the carrier could argue that the claimant had voluntarily withdrawn from the labor market.
 
We submit therefore that carriers should: (1) pursue the attachment to the labor market defense vigorously before and at the time of classification and (2) argue for a finding of voluntary withdrawal from the labor market after classification if the carrier can show that the claimant ceased those activities which previously proved the claimant’s attachment to the labor market at the time of classification.
 
We believe that the proof required to argue this will be like that required by numerous Board Panel decisions concerning the reopening of a claim following classification with a PPD. Such proof typically consisted of copies of questionnaires sent to the claimant asking if the claimant was looking for work, offers of vocational services, job leads sent to the claimant, and the results of follow up on those leads. Similar evidence used in reopening those claims will prove useful in pursuing the voluntary withdrawal defense following the 2017 amendment to Section 15(3)(w).
 
If you have any questions or need assistance concerning defense of a post-PPD claim, please do not hesitate to contact any one ofour attorneys. 

On 5/4/17, the Appellate Division, Third Department, decided McKinney v. United States Roofing Corporation,which contains several holdings clarifying issues commonly seen at hearings concerning labor market attachment and lost time awards. This decision is of interest given the contradictory Board Panel decisions on the attachment to labor market defense and the recent 2017 amendments to the Workers’ Compensation Law eliminating the need for permanently partially disabled claimants entitled to benefits at the time of classification to produce proof of labor market attachment.
 
TheMcKinney decision confirms that a total disability opinion does not shield the claimant from a suspension of awards when the Board rejects that total disability opinion and finds the claimant to have a partial disability. This is not a new concept. The Appellate Division previously addressed this issue in both Testani v. Aramark Services, 306 A.D.2d 709 (3d Dep’t 2003) andBrowne v. Medford Multi-Care, 89 A.D.3d 1173 (3d Dep’t 2011). Nevertheless, the decision inMcKinney reinforces prior rulings on this issue by holding that when the Board rejects a total disability opinion and awards benefits of a partial disability rate, there is an implicit finding that the claimant must produce evidence of the attachment to labor market.
 
Second, the McKinney decision affirms that the labor market attachment defense is merely a subset of the requirement that awards to a claimant are not appropriate where there is no causal connection between the claimant's reduction in earnings and the claimant's work injury. Even though the 2017 amendments to the Workers' Compensation Law eliminated the need for permanently partially disabled claimants entitled to benefits at the time of their classification to produce proof of labor market attachment, there is no bar against carriers arguing that the same claimants are not eligible for awards if they are self-limiting their earnings, or if there is no causal connection between the reduction in earnings in the work injury for any reason other than failure to prove labor market attachment. Nor do we believe that the 2017 change in the law prevents carriers from arguing that the claimant hasvoluntarily withdrawn from the labor market as we have previously discussed in our article above.
 
Finally, theMcKinney decision resolves, somewhat, the question of when indemnity awards should be suspended where the claimant is found not attached to labor market. InMcKinney, the Court agreed with the Board’s suspension of the claimant's benefits prior to the hearing at which the claimant was scheduled to testify on the labor market attachment issue based on the claimant's failure to produce proof of labor market attachment prior to that hearing.

On 5/4/17 the Appellate Division, Third Department decided Misquitta v. Getty Petroleum.  This case holds that the Special Fund for Reopened Cases under WCL §25-a is liable for death claims resulting from injuries from a claim that had already been transferred to it before the January 1, 2014 cutoff date for §25-a transfers, even when the death claim itself was not made until after that date.
 
This case involved a 1985 injury established for a myocardial infarction with a permanent total disability classification. Liability for the claim transferred to the Special Funds Conservation Committee (SFCC) under WCL §25-a in 2000. The claimant died due to coronary artery disease on May 2, 2014 and his wife brought a claim for death benefits against the Special Funds. The SFCC argued it was not responsible for the death claim because it was filed after the January 1, 2014 §25-a cutoff.  The employer and original carrier were brought into the litigation but they argued that the SFCC was responsible for any liability on the death claim based on the 2000 §25-a transfer. The WCLJ found in the employer and original carrier’s favor and a Board Panel affirmed on appeal. Special Funds appealed to the Appellate Division, Third Department which affirmed, holding Special Funds liable for the death claim regardless of its date of filing, because Special Funds was already the liable carrier for the underlying workers’ compensation claim based on the 2000 §25-a transfer.
 
The employer and original workers’ compensation carrier also argued that the January 1, 2014 cutoff for §25-a transfers was unconstitutional based on the American Economy Insurance Company v. State of New York case. 139 A.D.3d 138 (1st Dep't 2016). That decision is currently pending on appeal to the New York State’s highest appellate court, the Court of Appeals.  The Appellate Division did not address the merits of the American Economy issue because it ruled in favor of the employer and original carrier based on different legal grounds.
 
Misquitta establishes that the Special Fund will be liable for a compensable death claim regardless of the date of filing if liability for the original workers’ compensation claim which led to the death transferred to the Fund under §25-a before the January 1, 2014 cutoff date.

Earlier this month in Toys R Us, N.Y.W.C.B. 80801667 (5/11/17), the Board directed the claimant's treating physician to develop a program to wean the claimant from Fentora, Kadian, Parafon, and Rozerem in accordance with recommendations set forth in the carrier's IME report and the Non-Acute Pain Medical Treatment Guidelines (NAP-MTGs). This decision modified the finding of the WCLJ, who refused to make any changes to the claimant's treating physician's prescription regimen due to the claimant's extreme pain. This case was litigated and argued by our partner,Melanie Wojcik.

This case serves as a reminder that the Board will enforce its Medical Treatment Guidelines, especially with respect to opioid weaning. The claimant in this case showed no functional improvement by following the treating physician's opioid-based treatment plan, which had a morphine equivalent dose (MED) of approximately 150 mg. The carrier's IME opined that the claimant's "current medical regimen is not consistent with the medical treatment guidelines." The IME set forth his recommendations for weaning of the opioid medications.

Despite a factual inaccuracy in the IME report, the Board found that the IME's report was "most consistent" with the NAP-MTGs and that the claimant should be weaned from his medication regimen based on the recommendations in the IME report.

Opioid weaning decisions such as this one can help employers and carriers in reducing long-term liability in their cases and reduce the medical costs of claims in anticipation of settlement.

Hamberger & Weiss - Buffalo Office
700 Main Place Tower
350 Main Street
Buffalo, NY 14202
716-852-5200
buffalo@hwcomp.com

Hamberger & Weiss - Rochester Office
1 South Washington Street
Suite 500
Rochester, NY 14614
585-262-6390
rochester@hwcomp.com

Copyright © 2017, Hamberger & Weiss, All rights reserved.
You are receiving this email because you are a valued client of Hamberger & Weiss
Our mailing addresses are:

Hamberger & Weiss                   
1 South Washington Street       
Suite 500                               
Rochester, NY 14614

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350 Main Street
Buffalo, NY 14202
         
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H&W New York Workers' Compensation Defense Newsletter
Vol. 1, Issue 7

• Upcoming H&W Webinars on Initial Claims Handling
• Recommendations for Expedited Hearings on Medical Treatment Issues
• Workers' Comp Reform on Legislative Agenda
• Rare Split Decision from Appellate Division in LWEC Case
• Contact Us

We are pleased to offer you the opportunity to attend one or both of our free webinars in April and May 2017. 

On 4/27/17, attorneySusan Parzymieso will present Strategies for Initial Claims Handling. She will discuss best practices for initial claims handling and how to manage claims through the eClaims process to set them up for the best defense in the future. 

Please click here to register for the Initial Claims Handling webinar. The webinar is scheduled to take placeThursday, April 27 at 1:00pm.

On 5/31/17, our partnerNicole Graci will discuss New York's new Paid Family Leave Law, which will be administered by the Workers' Compensation Board. Employee contributions to New York State Paid Family Leave can begin on 7/1/17, and the Paid Family Leave Program goes into effect 1/1/18. Please join us for an introductory webinar, where we will address eligibility, filing requirements, denials, arbitration, and other pertinent issues facing employers, self-insured employers, carriers and third party administrators.

Please click here to register for the Paid Family Leave webinar. The webinar is scheduled to take placeWednesday, May 31 at 1:00pm.

We have noted in recent months that WCLJs have been strictly enforcing the requirement on Board Notices of Hearing regarding the scheduling of depositions in cases involving medical treatment issues. Specifically, WCLJs are precluding employers and carriers from scheduling depositions on these treatment issues when no attempts have been made to complete the deposition prior to the initial expedited hearing on the issue. 

If you receive a Notice of Expedited Hearing on a medical treatment issue, that Notice will usually contain language directing the parties to complete depositions prior to the hearing. If that is the case, we strongly recommend that you contact defense counsel to review the file to determine if a deposition should be scheduled. 

More often than not we do not recommend deposition testimony, particularly if the treatment at issue involves physical therapy or chiropractic care or where the attending physician didn’t meet his or her burden of proof in making the treatment request. But in those cases involving surgery requests or other expensive forms of treatment, it may be advisable to depose the treating physician. 
 
Given the short period of time between the issuance of the Notice of Hearing and the date of the expedited hearing, having the deposition completed before the hearing is usually impossible. Some WCLJs are more lenient than others with this, but at the very least we recommend at least getting these depositions scheduled before the hearing in those cases where it is advisable to do so. This shows diligence in complying with the Board's direction and we can submit an affirmation requesting an extension showing the doctor's inability to participate in a deposition prior to the hearing. This allows us to protect the record for a potential appeal.

If you have any questions regarding a Notice of Expedited Hearing on a medical treatment issues, please do not hesitate to contact any of our attorneys. 

With the deadline for the New York State Budget looming, workers' compensation reform is again on the Legislative agenda. Of interest to workers' compensation payers are a trio of bills designed to limit costs in the system related to permanent partial disability claims that were not addressed by the 2007 reforms. 

The first,S.4014/A.5977, directs the Board to adopt medical impairment guidelines for schedule loss of use (SLU) awards "substantially similar to those developed and completed by the Board on [1/8/16]." There is no reference in the bill to the content of the referenced Guidelines and we can only speculate as to the contents of same. The sponsors' justification for the bill notes that SLUs represent over $1.3 billion in costs to the system and the current impairment guidelines for SLUs are over 35 years old and do not reflect advances in medical science. 

The second,S.4554/A.6218, would limit SLU awards to those claimants who have an "impairment of wage earning capacity" of 85% or higher. Those claimants with an "impairment of wage earning capacity" lower than 85% would receive benefits at two-thirds of their average weekly wage for a maximum of 525 weeks, "during the continuance of such permanent partial disability." 

The intent of the bill is to stop indemnity compensation to those claimants with an "impairment of wage earning capacity" lower than 85% once they return to work. This would prevent claimants with little or no lost time from receiving a large lump sum SLU that is out-of-proportion to the claimant's actual lost wages.

This is a laudable goal, but the the bill appears to confuse concepts of wage earning capacity applicable to classifiable permanent partial disabilities with SLU awards. In doing so it could be used to argue for payment of indemnity to non-working claimants with relatively small schedule losses for periods greatly exceeding the schedule for that body part. 

The last bill,S.4520/A.6602, specifies that the durational limit (caps) on permanent partial disability claims under Section 15(3)(w) (classification claims) would begin on the date of injury, rather than the date of the claimant's legal classification by the Board. 

All three bills are the subject of vehement opposition from labor and the claimant's bar. 

On 3/30/17, the Appellate Division, Third Department, in a split decision with a 3-2 majority, decidedBurgos v. Citywide Central Insurance Program, et. al., affirming a Board decision finding the claimant to have a permanent partial disability with an 85% loss of wage earning capacity. The claimant wanted classification with a permanent total disability, based on the opinion of her treating physician, who opined that she suffered a total disability due to difficulty with prolonged walking, standing, and sitting, an inability to lift anything, and difficulties with transportation and personal hygiene. Moreover, the treating physician opined on a C-4.3 form that the claimant had an exertional ability of performing "less than sedentary work."

The Court cited the rule that a permanent total disability is appropriate "where the medical proof shows a claimant is totally disabled and unable to engage in any gainful employment." Relying on this, it dismissed the claimant's reliance on her physician's opinion that she was capable of only "less than sedentary" work in arguing for a permanent total disability. The Court said that although this fact would be relevant in determining the claimant's loss of wage earning capacity and the durational limit of the claimant's permanent partial disability benefits, it would not be dispositive "in the context of establishing the claimant's overall disability."

The Court's majority ruled that substantial evidence supported the Board's decision of a permanent partial disability, which credited the conclusions of the employer's independent medical examiner, who found the claimant to have few restrictions on work than the treating physician.

The dissenting justices felt that the Board should have found the claimant to have a permanent total disability since it found her to be capable of only "less than sedentary work" and determined that she had the highest medical impairment rating available under the 2012 Guidelines for a low back injury. The dissenting justices opined that such findings invite the question of what gainful employment the claimant could possibly perform with that level of medical impairment and functional loss, noting that the record identified none and that they were unaware of any such employment either. It appears to us that the dissenting justices confuse the concept of total industrial disability with the separate issue of total medical disability. 

Because of the split decision, the claimant will have the opportunity to take an appeal by right the Court of Appeals, the highest court in the State of New York.

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