NWCDN Members regularly post articles and summary judgements in workers’ compensations law in your state.
Select a state from the dropdown menu below to scroll through the state specific archives for updates and opinions on various workers’ compensation laws in your state.
Contact information for NWCDN members is also located on the state specific links in the event you have additional questions or your company is seeking a workers’ compensation lawyer in your state.
A long-time friend of
this firm, Machelle Davidson, a senior claim representative at Accident Fund,
has been named a 2023 recipient of AF Group’s Legend Award.
In announcing the award, AF Group explained that the award recognizes AF Group
teammates who demonstrate its People First culture through their
outstanding character, leadership, and commitment to excellence. Lisa Corless,
president and CEO of AF Group, said that “each of our winners is an absolute
shining example of who we are as a People First, values-driven organization
. . . We’re all made better by having them as part of our team.”
We could not have said it better. Congratulations, Machelle!
Copyright 2023, Stone Loughlin & Swanson, LLP
A worker in Austin, Texas lost his bid to carve out an exception to the
exclusive remedy of the Texas Workers’ Compensation Act on the ground that, at
the time of his injury, he was performing duties outside of the course and
scope of his employment.
Melvin Gonzalez worked as a car detailer and porter for Dynamic Motors, a used
car dealership and service garage whose advertising catchphrase is “Don’t
Panic. GO DYNAMIC!”
The service manager asked him to help with repairs on the roof, and while doing
so Gonzalez stepped through a skylight and fell 20 feet to the concrete floor
below.
Dynamic filed a report of injury with its workers’ compensation insurance
carrier and Gonzalez accepted workers’ compensation insurance benefits. He then
sued Dynamic, alleging that the company was negligent in failing to provide
fall protection.
Dynamic asserted the affirmative defense that workers’ compensation insurance
benefits were Gonzalez’ exclusive remedy, and the trial court agreed. On
appeal, Gonzalez argued that because roof repairs are not part of Dynamic’s
business, and because he was injured while performing such repairs, he was not
engaged in the usual course and scope of Dynamic’s business and was, therefore,
not an “employee,” as that term is defined by the Texas Worker’s Compensation
Act, at the time of the injury. The Austin court of appeals disagreed and said
that the Act does not contemplate a “task-by-task” approach to the issue of
whether a worker is injured in the course and scope of employment.
You can read the decision here.
Copyright 2023, Stone Loughlin & Swanson, LLP
In our August newsletter, we reported optimism that the Texas Department of Insurance, Division of Workers’ Compensation may begin requiring applicants for Supplemental Income Benefits to provide material evidence of job applications they have submitted in their search for work. Two conflicting developments this month have heightened the intrigue.
The source of our optimism in August was a memo to stakeholders from General
Counsel Kara Mace enclosing proposed changes to the DWC Form-052, Supplemental
Income Benefits Application. The proposed revision included an FAQ page with
the following guidance for applicants looking for work on their own:
Show you were actively looking for a job by attaching job applications or other documents showing you were looking for a job.
The first development this month buoyed our optimism – it was the Division’s
filing of a legal brief in the Supreme Court of Texas in the long-running
litigation over the validity of the SIBs rule. As we have reported, on behalf
of our client, Accident Fund Insurance Company of America, we challenged the
rule as facially invalid because, among other things, it allows the Division to
award SIBs to claimants who purport to be looking for work on their own but who
do not document an active work search with job applications submitted as
required by the Texas Workers’ Compensation Act. A Travis County district court
agreed that the rule is invalid and enjoined the Division from applying it, but
the Division appealed that ruling and then the Austin court of appeals muddied
the water by affirming in part and reversing in part. Accident Fund now has
filed a petition for review by the Supreme Court of Texas in an attempt to
obtain clarity. On October 6, the Division, represented by the Attorney
General, filed a response to the petition. When describing applications for
SIBs filed by workers who purport to be looking for work on their own, the Division
made this representation to the court:
The Division requires injured workers independently looking for work to document their searches by job applications. If the worker submits an online or hard-copy written application, a copy must be provided to the Division with the worker’s SIBs application.
See page 19 of
Division’s Response to Petitions for Review in Accident Fund Insurance Company of America and Texas Cotton
Ginners’ Trust v. Texas Department of Insurance, Division of Workers’
Compensation, Cause No. 23-0273, which is available for review and
downloading here.
This representation by the Division seems to confirm that change is afoot because the
position it is taking now certainly is not the position it has taken in the
past. Indeed, one of the reasons that Accident Fund challenged the validity of
the SIBs rule in the first place is that the Division historically has not required SIBs recipients
to provide copies of job applications they claim to have submitted to employers
– instead, it has merely asked them to check boxes and fill in blanks on the
Form DWC-052 (Application for Supplemental Income Benefits) describing actions
they have taken.
But the second development this month has clouded the picture. On October 13,
we received a decision from a contested case hearing that directly contradicts
the Division’s representations to the state’s highest court. In that contested
case hearing, in which the issue was entitlement to SIBs, we argued that the
worker was not entitled to SIBs because
she had not provided copies of job applications that she claimed she had
submitted to employers. The Administrative Law Judge dismissed that
argument and ordered payment of SIBs. In her decision, she wrote:
The insurance carrier
questioned the claimant’s credibility because she did not
provide any documentary evidence of the applications or emails she sent to the
companies listed. The insurance carrier also contended that the claimant did not
make an active effort to obtain employment. The insurance
carrier’s argument was considered, but it was not persuasive.
Based on a careful review
of the evidence presented, the
claimant met her burden of proof to establish that she demonstrated an active
effort to obtain employment.
The claimant performed three work search contacts each week of the qualifying
periods. Accordingly, the claimant is entitled to supplemental income benefits
for the third and fourth quarters.
So we have to ask –
have Division ALJs not gotten the memo that the Division’s position has
changed? Or was the Division’s representation to the state’s highest court
incorrect?
Copyright 2023, Stone Loughlin & Swanson, LLP
If you are a regular reader of our newsletter, you know that there was a
challenge pending in the 13th Court of Appeals to the old Seabolt standard for
determining entitlement to Lifetime Income Benefits. The challenge boils
down to whether “total loss of use” of a body part as stated in the current
LIBs statute really means “total” and whether loss of use under the current
LIBs statute means loss of function as a member of the body, or loss of
function in regard to employability. At the Zoom trial held in this case, the
trial court judge determined that the old standard still applied and that the
worker could not work using his hand, despite the video evidence that showed
the worker using his hand while working for himself. Well, lo and behold, well
after the fact and during the course of the carrier’s appeal to the 13th Court
of Appeals, SLS received an anonymous letter in the mail. We will leave
you to wonder what the letter said, but it did mention in closing that SLS did
a good job at the trial, which was a nice compliment having nothing to do with
the merits of the case. Given that the trial was held by Zoom with limited
participants, we wonder how the writer of the letter knew so much!
In the meantime, the 13th Court of Appeals issued a Memorandum opinion on
October 12, 2023 dodging the legal issue it was asked to address, and holding
that “the doctrine of vertical stare decises” required the Court to follow the
precedent of the Texas Supreme Court as established law affirming the use of
the Seabolt
standard to new law cases. However, the precedents the Court cited were
not cases where any party directly challenged the Seabolt standard itself. The
cases merely applied that standard. No challenge was made in those cases
on the basis that under the current LIBs statute employability is not relevant
to the application of the statutory language of “total loss of use.” The LIBs
statute contains no qualifier indicating that employability is determinative of
entitlement. The Court of Appeals case is not yet final.
You can read the
decision here.
Copyright 2023, Stone Loughlin & Swanson, LLP
Another long-time friend of this firm, Jacquelyn Coleman, recently retired from
the Division after serving for 16 years as an ALJ and has started her own
mediation practice. While she normally conducts mediations by Zoom, she can
perform in-person mediations with advance notice.
You can learn more about Ms. Coleman and her mediation services on her website
at jdcmediation.com.
We wish you well in your new endeavor, Jacquelyn!
Copyright 2023, Stone Loughlin & Swanson, LLP
Travis County District Court Judge Madeleine Connor signed a judgment in favor
of the insurance carriers in the PHI Air Medical Case on August 8, 2023.
PHI Air Medical had until September 7, 2023 to appeal Judge Connor’s
decision to the court of appeals but did not do so, making her decision final.
Judge Connor found that PHI Air Medical did not timely file its petition
for judicial review challenging SOAH’s decision awarding payment of 149% of the
Medicare rate and agreed with the carriers that 149% of the Medicare rate exceeds
the Workers’ Compensation Act’s fair and reasonable reimbursement standards for
the 33 fee disputes at issue in the case.
The PHI case began at the State Office of Administrative Hearings (SOAH) in
2015 when Administrative Law Judge Craig Bennett consolidated the 33 fee
disputes involving eight carriers consisting of Texas Mutual Insurance Company,
Hartford Underwriters Insurance Company, TASB Risk Management Fund,
Transportation Insurance Company, Truck Insurance Exchange, Twin City Fire
Insurance Company, Valley Forge Insurance Company, and Zenith Insurance
Company.
The PHI case went all the way to the Texas Supreme Court which ruled in favor
of the carriers. PHI petitioned the U.S. Supreme Court for review but it
declined to hear the case. The case then went back to the court of
appeals for a second decision before heading back down to the trial court where
the carriers filed a motion for summary judgment. Because PHI did not
appeal Judge Connor’s order granting summary judgment for the carriers, the PHI
case will now be remanded to SOAH for further proceedings consistent with Judge
Connor’s final judgment.
The rest of the air ambulance disputes at SOAH and DWC have been abated while
the PHI case proceeded. However, Air Evac, another air ambulance
provider, recently filed a motion to lift the abatement of its cases at SOAH so
that it could brief how a 2018 injunction that it obtained applies to its cases
at SOAH. The injunction states that DWC is “enjoined from enforcing Texas
Labor Code § 413.011 and 28 Texas Administrative Code against Plaintiff Air
Evac EMS, Inc.” The parties filed a proposed briefing schedule on
September 15, 2023 which the ALJ has not yet ruled upon.
As of August 2023, there are 2,414 air ambulance disputes pending at DWC.
This figure does not include the air ambulance fee disputes pending at
SOAH. The average amount sought by the air ambulance provider in each
case at DWC is estimated to be at least $50,000, which is the difference
between what the air ambulance provider was paid by the carrier and its
unregulated billed charges. This makes the total amount sought by the air
ambulance providers in the disputes at DWC over one hundred and twenty million
dollars plus interest.
There are five air ambulance providers that comprise the vast majority of the
air ambulance disputes. These providers are Air Evac EMS, Inc., EagleMed, LLC,
Med-Trans Corp., Rocky Mountain Holdings, and PHI Air Medical, LLC. These
five providers are owned by two private equity firms and a publicly traded
company. Air Evac EMS, Inc., EagleMed, LLC, and Med-Trans Corp. are
subsidiaries of Air Medical Group Holdings (AMGH) which is owned by private
equity firm KKR. Rocky Mountain Holdings (a subsidiary of Air Methods) is
owned by private equity firm American Securities, LLC. And PHI Air Medical, LLC
is a subsidiary of publicly-traded Petroleum Helicopter International, Inc. (PHIL).
The air ambulance providers continue to argue that the federal Airline
Deregulation Act (ADA) preempts Texas workers’ compensation laws that regulate
reimbursement to air ambulance carriers and therefore, DWC must order the
carriers to pay their grossly inflated billed charges. However, the Texas
Supreme Court already squarely rejected this argument in the PHI case:
“First, if ADA preemption applies, neither state nor federal law provides for full reimbursement of air carrier bills—or for any reimbursement at all. Second, the effect of federal preemption cannot be that States must provide full reimbursement, as that outcome would violate the Tenth Amendment. For these reasons, the result of ADA preemption here would not be full reimbursement—it would be no reimbursement.”
If the air ambulance providers were able to force DWC to order payment of its
billed charges, it would result in a massive wealth transfer to private equity
investors and reward the takeover of the air ambulance industry by private equity.
See The Air-Ambulance Vultures A search for why my flight
cost $86,184 led to a hidden culprit: private equity.
Copyright 2023, Stone Loughlin & Swanson, LLP
We advised you last month that long-time Division Administrative Law Judge,
Carol Fougerat, decided to hang up her gavel (ALJs don’t wear robes) last month
and is now pursuing her next big adventure in life. Judge Fougerat was a most
excellent ALJ and will be missed.
This month, we can further announce that another favorite ALJ, Britt Clark, has
also left Hearings. Judge Clark, an astute judge with a wealth of knowledge,
has accepted a position with General Counsel. We wish him well in his new
position.
Copyright 2023, Stone Loughlin & Swanson, LLP
The Workers’ Compensation Research and Evaluation Group this month released its
report on pharmacy utilization and cost in the Texas workers’ compensation
system between 2009 and 2022. The aim was to capture data before and after the
introduction of the pharmacy closed formula and the results are interesting:
To access the entire report, click here. For a quick overview, see the snapshot on the TDI website.
Copyright 2023, Stone Loughlin & Swanson, LLP