State News : West Virginia

Emergency Order 20-EO-03 COVID-19 State of Emergency - West Virgnia Workers' Compensation Insurance

 In Emergency Order 20-EO-03, entered March 23, 2020, Insurance Commissioner Dodrill ordered that normal time standards for claims handling applicable to workers' compensation insurers and other regulated entities as set forth in title 85, series 1, section 10, of the West Virginia Code of State Rules are suspended until further notice, provided that workers' compensation insurers and other regulated entity shall continue to adjust workers' compensation claims as expeditiously as possible during the insurance emergency and shall utilize all possible methods of adjusting claims remotely, such as telephone, email, facsimile, and mobile applications, all the while striving to meet normal time standards for the adjustment and resolution of claims whenever possible. Workers' compensation insurers and other regulated entities shall prioritize claims adjustment and resolution strategies during this insurance emergency to ensure that high-priority claims are addressed before lower priority claims.

Commissioner Dodrill ordered that workers' compensation insurers and other regulated entities shall not terminate or suspend a claimant's temporary total disability benefits for failure to undergo examinations or needed treatment during this insurance emergency. The Commissioner recognizes many medical or healthcare providers have closed offices, deferred or suspended all non-emergent procedures and treatment during the state of emergency, and that claimants may have difficulty in continuing ongoing care or treatment or obtaining an examination, or may be quarantined or staying in their homes.

Importantly, Commissioner Dodrill ordered workers' compensation insurers and other regulated entities to review Executive Order 7-20 issued by Governor Jim Justice on March 19, 2020, and evaluate their telehealth and telemedicine programs to ensure utilization to the fullest extent possible. The use of telehealth or telemedicine can potentially reduce barriers for treatment as virtual office visits have been identified as a way of safely treating certain patients were claimant's while containing or limiting the spread of infection in hospitals, clinics and medical offices.

On March 24, 2020, Commissioner Dodrill entered Emergency Order 20-EO-04 allowing Emergency Insurance Adjusters to be utilized to adjust claims. Commissioner Dodrill ordered that any insurance company licensed to do business in West Virginia may submit to the Commissioner an application requesting appointment and authorization of one or more emergency insurance adjusters for the purpose of adjusting claims in West Virginia during the pendency of the current COVID-19 insurance emergency. An emergency insurance adjuster license is valid only for so long as the Commissioner specifies, but not to exceed a period of 120 days unless extended for a period of an additional 90 days. An emergency insurance adjuster license is valid only for the COVID-19 insurance emergency. During the time an individual is licensed as an emergency insurance adjuster, he or she has the same power, authority and responsibility as other licensed insurance adjusters in the state. An emergency insurance adjuster licensing application can be found on the Commissioner’s website at www.wvinsurance.gov/Divisions/Licensing. The completed application can be submitted via email toOICAgentLicensing@wv.gov. A link to the application can also be found under the red “COVID-19” tab on the Commissioner’s website. Due to remote working restrictions, the Commissioner will not accept applications via facsimile or U.S. Mail at this time. 

H Dill Battle III
Spilman Thomas & Battle, PLLC
300 Kanawha Boulevard, East (ZIP 25301)
Post Office Box 273
Charleston, WV 25321-0273
O 304.340.3823
M 304.206.1986
F 304.340.3801
HDBattle@spilmanlaw.com

Two bills of interest to the Workers' Compensation Field:

SB 275
Also, as previously reported, an intermediate court of appeals of West Virginia is one step closer to reality asSenate Bill 275 advanced out of the Senate by a mostly party line vote of 18-14, with two Senators absent. As previously reported, Senate Bill 275 would create an Intermediate Court of Appeals which would hear, by right, all appeals from Circuit Courts after June 30, 2021, and its decisions would be accorded precedential effect by the lower courts. Appeals of decisions from that court to the Supreme Court of Appeals would be by discretion only. The judges are elected to 10-year terms by the citizens in non-partisan election. The bill creates a northern and southern district within West Virginia, each with a three-judge panel to hear appeals arising out of its geographical area and is expected to cost $6.3 million a year. Additionally, the bill significantly reorganizes workers' compensation appeals by transferring all powers and duties of the current Workers' Compensation Office of Administrative Law Judges to the three-judge panel of the Workers' Compensation Board of Review. The Office of Judges would issue final decisions on all objections in its possession on or before September 30, 2021, and will then sunset on October 1, 2021. The Intermediate Court of Appeals would exercise appellate jurisdiction over all decisions issued by the Office of Judges and the Board of Review after June 30, 2021.
 
The bill was reported to the House where it was double-referenced to Judiciary and then Finance. Its future in the House is cloudy, at best, given its history there.

SB 339 and SB 752
When the West Virginia Medical Cannabis Act of 2017, as created bySenate Bill 386, was enacted, the program had serious shortcomings which had to be addressed in 2019 bySenate Bill 1037. One of those shortcomings, according to medical cannabis advocates and market watchers was the restrictive manner of delivery of medical cannabis. Indeed, Senate Bill 386 only permitted pills, oils, tinctures, and creams, but did not permit leaf or plant forms, unless such were approved by the Department of Health & Human Resources in the rules it was required to promulgate to implement the program. Therefore, when medical cannabis advocates in the Legislature had under consideration those very rules, as bundled in Senate Bill 339, they successfully amended the same in committee to permit dispensaries to provide medical cannabis in dry leaf of plant form. The committee amendments were adopted by the full House by a vote of 74-23, with three absent. Since the House amended a Senate bill, it was reported back to the Senate for concurrence. The Senate, meanwhile, had under considerationSenate Bill 752 which, among other things, expanded the definition of serious medical conditions for which medical cannabis is approved to include ulcerative colitis as well as opioid use disorder. Furthermore, the bill made it easier to change the form of delivery of medical cannabis by empowering the commissioner of the Bureau of Public Health to approve such forms upon a recommendation of the advisory board. This bill is expected to pass the Senate on February 26. Its future in the House seems bright, given the action that chamber took on the rules bundle in Senate Bill 339. 

For more information or any questions, please contact Dill Battle at 304-340-3800.

First Responder PTSD Bill Advances to the Full West Virginia House of Delegates

February 17, 2020: A first responder PTSD bill advanced to the full House of Delegates after an unanimous voice vote from the House Judiciary Committee meeting this morning. House Bill 2321 provides that PTSD suffered by a first responder is a compensable injury "upon a diagnosis by a licensed psychiatrist that the first responder suffers from the disorder and upon a finding that the disorder occurred as a result of an event or events that occurred in the course of within the scope of the first responder's employment duties." HB 2321 modifies W. Va. Code § 23-4-1f which provided that mental-mental claims are not compensable in West Virginia. The current law states: "No alleged injury or disease shall be recognized as a compensable injury or disease which was solely caused by nonphysical means in which did not result in any physical injury or disease to the person claiming benefits." The proposed bill defines first responder as a law-enforcement officer, firefighter, emergency medical technician, or paramedic. PTSD is defined as a "disorder that meets the diagnostic criteria for post-traumatic stress disorder specified by the American Psychiatric Association in the Diagnostic and Statistical Manual of Mental Disorders, fifth edition, or a later addition as adopted by rule of the insurance commissioner." The Legislature finds it is the moral obligation of the state to provide coverage to this class of individuals for their work-related injury because first responders are required "to expose themselves to post-traumatic stress disorder causing events" during the course of their employment, and because of "the severe nature and deliberative effect of post-traumatic stress disorder."

The Legislature may have meant to say PTSD is severe and can have a "debilitating effect" on those suffering from it. PTSD symptoms or diagnosis may not manifest immediately after an event, so noticeably lacking from the bill is criteria for determining whether the PTSD claim is an occupational injury or an occupational disease for the purpose of determine the statute limitations. As drafted, it appears the drafters believe PTSD is an injury because the disorder arises on the date of the event or events causing PTSD, which would trigger a six-month statute limitations for occupational injuries under W. Va. Code § 23-4-15(a). The longer three-year period for filing an occupational disease claim in W. Va. Code § 23-4-15(c) would not apply. If the PTSD does not manifest and a diagnosis is made within the six-month period after the triggering event, a first responder could be barred from filing a claim.

If you have questions or need more information, please call or e-mail Dill Battle at 304.340.3823 ordbattle@spilmanlaw.com

H. Dill Battle III, Esq.

Spilman Thomas & Battle, PLLC
300 Kanawha Boulevard, East
Charleston, WV 25301
304.340.3823 - office
304.340.3801 - fax
dbattle@spilmanlaw.com

 The Dome Report - 2020 West Virginia Legislature Updates, Issue 3

 Dill Battle, Chair Workers' Compensation Practice Group

304.340.3823

dbattle@spilmanlaw.com

In State ex rel. Gallagher Bassett Services, Inc. v. Webster, No. 19-0043 WL 2494609 (W. Va. June 12, 2019), the West Virginia Supreme Court of Appeals held that the West Virginia workers’ compensation statute provides to third-party administrators (TPAs) statutory immunity from claims of workers’ compensation discrimination brought by employees. In granting third-party administrator Gallagher Bassett’s petition for a writ of prohibition and reversing the Circuit Court’s decision to deny the TPA’s motion to dismiss worker’s compensation discrimination and fraud claims brought against it, the Court determined that the TPA enjoyed immunity from the discrimination claim and that the fraud claim was barred by the relevant statute of limitations. Among the more notable parts of the Court’s opinion, however, is a discussion which appears to indicate that the Court may be amenable to relieving TPAs of liability for fraudulent denial of workers’ compensation benefits, a common law cause of action first recognized by the Court in Persinger v. Peabody Coal Co., 196 W. Va. 707, 474 S.E.2d 887 (1996). It appears possible the Court may extend the statutory immunity provided to TPAs by W. Va. Code § 23-2C-21(a) so as to cover fraud claims or alternatively to limit the reach of the Persinger cause of action.

The Persinger doctrine holds that the West Virginia workers’ compensation statute’s exclusive remedy provision does not preclude a civil fraud claim against employers that is separate and distinct from the employee’s original claim for benefits. That is, the Persinger action alleges damages stemming not from the workplace injury, but rather from denial of the employee’s claim based on fraudulent misrepresentation of information by the employer to some other person or body with authority to decide on the fate of the claim. Use of the fraudulent denial claim, however, has not been limited to actions against employers in West Virginia; TPAs have become liable under thePersinger doctrine as well.

For instance, in Barber v. Sedgwick Claims Management Services, Inc., No. CV 3:14-27349, 2016 WL 6211714 (S.D.W. Va. Oct. 24, 2016), plaintiff Jill Barber brought suit against Sedgwick, the TPA for her self-insured employer, Family Dollar, alleging fraudulent denial of benefits. Barber had been bitten by a brown recluse spider in the course of her employment and was initially approved for both wage loss and medical benefits following complications with the wound. However, Sedgwick later denied further treatment for Barber after a physician diagnosed her with an underlying auto-immune disease which was suggested to be responsible for the wound’s failure to heal. Barber alleged Sedgwick’s reviewing physician’s report was fraudulent and brought suit against the TPA for relying on the report in denying her benefits.

In an effort to dispose of Barber’s claims against it, Sedgwick moved for judgment on the pleadings, asserting—among other arguments—that thePersinger fraud claim was barred by W. Va. Code § 23-2C-21(a). That section provides that “[n]o civil action may be brought or maintained by an employee against a private carrier or a third-party administrator, or any employee or agent of a private carrier or third-party administrator, who violates any provision of this chapter or chapter thirty-three of this code.”

The District Court rejected that argument, finding that the Persinger cause of action’s source in common law—rather than Chapter 23 or 33 of the West Virginia State Code—precluded statutory immunity from covering the fraud claim. In denying Sedgwick’s motion and permitting the case to move forward, the Court indicated that TPAs fall within the scope of thePersinger doctrine and that they are not eligible for statutory immunity from the common law fraud claim. That state of affairs may change, however, in light of the West Virginia Supreme Court’s discussion ofPersinger claims in Gallagher Bassett.

Robin Lusk, the respondent in Gallagher Bassett, was employed as a long-haul truck driver by Old Dominion Freight Line, Inc., along with her husband, Kevin Lusk. In 2015, while in California for work, the Lusks drove into Old Dominion’s Los Angeles terminal to begin a haul. A computer system malfunction occurred while the Lusks’ truck was being connected with their new trailers that they were to haul, and Ms. Lusk received serious injuries. Some days later, an Old Dominion manager represented to Ms. Lusk that she and her husband had falsified entries in the Los Angeles terminal’s log book, and that both had been terminated from employment as a result. Upon returning home to West Virginia, the Lusks learned that their health insurance coverage had been terminated, and were informed by a representative of Gallagher Basset—Old Dominion’s third-party claims administrator—that Ms. Lusk’s claim for workers’ compensation benefits had been denied as the TPA had determined that her injury was not work-related.

Lusk protested the decision to deny her claim, and the West Virginia Workers’ Compensation Office of Judges (OOJ) ruled Ms. Lusk’s injury was in fact work-related, determining that her claim was compensable. The OOJ decision was affirmed by the Board of Review.

Following those decisions, Ms. Lusk sued Old Dominion and Gallagher Bassett in Kanawha County Circuit Court, alleging workers’ compensation discrimination and workers’ compensation fraud. Gallagher Bassett moved to dismiss all of Ms. Lusk’s claims against it, asserting that the claims were barred by the two-year statute of limitations and that it was not a proper defendant as it was not Ms. Lusk’s employer. Lusk responded that the statute of limitations had been tolled by the discovery rule, and that nothing in the state workers’ compensation statute precluded the application of the Persinger fraud cause of action to claims administrators. The Circuit Court denied the motion to dismiss, and Gallagher Basset subsequently filed a petition for a writ of prohibition with the West Virginia Supreme Court of Appeals, challenging the denial of its motion.

In granting the writ and ordering the Circuit Court to enter an order dismissing Ms. Lusk’s claims against Gallagher Bassett, the West Virginia Supreme Court first addressed questions of Gallagher Bassett’s statutory immunity to the discrimination claim pursuant to § 23-2C-21(a) of the state workers’ compensation statute. Again, that section provides that employees may not maintain any claims against TPAs growing out of Chapter 23 or Chapter 33 of the state code. The Court quickly noted that workers’ compensation discrimination is a statutory cause of action arising under Chapter 23 of the code, and held that the plain language of § 23-2C-21(a) necessitated the dismissal of the claim. Turning to Lusk’s fraud claim, the Court found that the discovery rule could not save the claim, rendering it barred by the two-year statute of limitations, again requiring its dismissal.

Perhaps just as relevant as the Court’s holding that TPAs are immune from discrimination claims, however, was its discussion of workers’ compensation fraud claims, shedding light on the possible direction the Court may take with thePersinger doctrine in future decisions. Prior to finding that Lusk’s fraud claim against Gallagher Bassett was barred by the statute of limitations, the Court entertained the possibility that the claim may have been improperly asserted against the TPA even in the absence of the statute of limitations.

First, the Court noted during its consideration of statutory immunity from the discrimination claim that the scope of the immunity supplied to TPAs by § 23-2C-21 might reasonably be interpreted as extending so far as to coverPersinger fraud claims. Subsection (c) of that section provides that attorney’s fees and costs must be awarded to a workers’ compensation claimant when the claimant’s self-insured employer or its TPA issues an “unreasonable” denial of benefits, which occurs when the employer or TPA is unable to demonstrate that it possessed sufficient probative evidence supporting the denial of the claim. The Court suggested conduct sufficient to constitute aPersinger claim—that is, knowingly and intentionally fraudulently misrepresenting facts in opposition to a claim for benefits—may constitute an “unreasonable” denial for purposes of subsection (c). If that were the case, subsection (a)’s prohibition on causes of action growing out of “any provision” of Chapter 23 would be invoked, shielding TPAs from the fraudulent denial claim. The Court ultimately declined to determine whether the scope of the immunity might be so broad, but by virtue of the discussion’s inclusion in the opinion, it would not be overly surprising to find the question answered in a future decision.

Separately, in discussing the scope of the Persinger cause of action itself, the Court pointed out that thePersinger opinion made repeated reference to civil claims against “an employer.” Nowhere in that opinion did thePersinger court describe a cause of action against self-insured employers’ TPAs for fraudulent denial of benefits. Although the doctrine has been interpreted by West Virginia courts to allow for TPA liability, a plain reading of thePersinger opinion does suggest that the claim for fraudulent denial of benefits was meant to be made against the partymaking the false representations, not the party relying on those representations. Again, the Court determined it did not need to make a determination on this point inGallagher Bassett, but the presence of the discussion seems to hint at an evolving understanding ofPersinger.

In sum, the current state of the law in West Virginia as it relates to liability for alleged fraudulent denial of benefits allows for claims of workers’ compensation discriminationand fraud against self-insured employers, while TPAs are liable solely for fraud. This state of affairs appears to be premised on the idea of TPAs and their employees acting as agents or servants of the self-insured employer so as to render the TPA liable as “an employer” under Persinger. In light of Gallagher Bassett, however, it does not seem outside the realm of possibility that the West Virginia Supreme Court may soon clarify the scope of the doctrine and relieve TPAs of liability for fraud.

Article by Dill Battle

If you have questions or need more information, please call or e-mail Dill Battle at 304.340.3823 ordbattle@spilmanlaw.com

H. Dill Battle III, Esq.

Spilman Thomas & Battle, PLLC
300 Kanawha Boulevard, East
Charleston, WV 25301
304.340.3823 - office
304.340.3801 - fax
dbattle@spilmanlaw.com

The Following are summaries of 2019 West Virginia cases dealing with the issues of pre-existing conditions and mental health exposure claims.

1.         Comorbidities and the Dreaded Pre-Existing Condition

 In Bowles v. WV Office of the Insurance Commissioner and Pine Ridge Coal Co., LLC, No. 18-0797, 2019 WL4165292 (W. Va. Sept. 3, 2019), the Supreme Court of Appeals of West Virginia found that a claimant had not established that his carpal tunnel syndrome was work related and affirmed an order denying compensation. The claimant, Mr. Bowles, worked as a coal miner for many years and was eventually diagnosed with carpal tunnel syndrome which he alleged was the result of repetitive wrist motions required by his job.Id. at *1. An independent medical evaluation revealed that Mr. Bowles suffered from two non-occupational risk factors, diabetes mellitus and obesity, which could cause carpal tunnel.Id. Additionally, the independent examiner opined that Mr. Bowles' work activities were not of the type to cause carpal tunnel and emphasized the fact that Bowels had quit working in 2012 and was not diagnosed with carpal tunnel until three years later.Id. at *2. Ultimately, Bowles' pre-existing conditions were a significant factor in denying his request for workers' compensation benefits. The Court found the only opinion as to causation was the IME doctor, who opined that the carpal tunnel syndrome was not causally related to Mr. Bowles's occupational activities. Instead, the IME doctor found Mr. Bowles has two important and significant nonoccupational risk factors for the development of carpal tunnel syndrome, diabetes mellitus and obesity. The fact that Mr. Bowles ceased work in 2012 and experienced increased symptoms for three to four years before filing for benefits is consistent with the doctor's opinion.Id., at *2.

 In contrast, the court in Arcelormittal Weirton, LLC v. Prentice, No. 18-0723, 2019 WL 1828005 (W. Va. Apr. 25, 2019), held that a claim for carpal tunnel and ulnar neuropathy was compensable despite the fact that the claimant suffered from pre-existing conditions, including diabetes and obesity. In that case, Mr. Prentice, the claimant, alleged that he developed carpal tunnel as a result of carrying tools while working as a crane repairman.Id. at *1.

An EMG performed on July 27, 2016, showed bilateral ulnar sensory and motor neuropathies, severe on the right and moderate to severe on the left. Mr. Prentice reported to his treating physician on August 26, 2016, tingling in both of his ring and small fingers. The treating doctor reviewed the EMG and noted that carpal tunnel syndrome was not diagnosed. On examination, Mr. Prentice had positive Tinel's and Phalen's signs over the median nerves of the wrists and positive Tinel's sign over the ulnar nerves in the elbows. The treating doctor noted Prentice's history of rheumatoid arthritis, bilateral ulnar nerve neuropathy at the elbow, and an exam suggestive of carpal tunnel syndrome. He recommended a repeat EMG. The treating physician diagnosed rheumatoid arthritis, bilateral post-traumatic osteoarthritis, bilateral ulnar neuropathy, and bilateral carpal tunnel syndrome. A repeat EMG was performed on September 2, 2016, and showed marked bilateral ulnar neuropathy.Id., at *1. Prentice's doctor performed carpal tunnel release surgery on October 5, 2016, and his claim was rejected thereafter on October 25, 2016.Id. In a subsequent record review, a different doctor noted Prentice's diabetes and obesity and opined that there was no evidence of carpal tunnel.Id. at *2. Despite the record review findings and the pre-existing conditions, the court found no error in awarding Prentice compensation.Id. at *2-3. The court stated that it was acceptable to find Prentice's practicing physician more persuasive than a doctor performing a record review. Prentice also presented evidence that his job required repetitive heavy manual lifting, which pursuant to West Virginia Code of State Rules § 85-20-41.5, has been shown to contribute to the development of carpal tunnel syndrome.Id. at *2.

These two cases document the Court's view the causation determination for CTS is fact-specific. When evaluating allegations of CTS, it is imperative to investigate the preexisting medical conditions of each claimant and determine the impact on the claimant's medical condition. Additionally, a precise examination of the job duties and functions of a claimant is also important to analyze the compensability under the parameters of West Virginia Code of State Rules § 85-20-41.5.

2.         Mental Health Exposure Claims

In D'Amour v. Combined Ins Co. of Am. AT, No. 18-0677, 2019 WL 2404586 (W. Va. May 30, 2019), the West Virginia Supreme Court held that adjustment disorder with anxious mood and post-concussion syndrome were compensable claims, in part overturning a decision by the Board of Review. The claimant, D'Amour, sought to add compensable conditions to his claims including Post-concussion syndrome and post-traumatic brain injury.Id. at *1. D'Amour was a door-to-door salesman and was injured when he knocked on a door and was attacked by four dogs.Id. D'Amour reported a bite on the wrist and head injury after he fell back and struck the sidewalk, but an initial CT scan revealed no abnormalities.Id.

D'Amour stated that his head was not bothering him at the emergency room, but he was perplexed when it took him three hours to drive home despite the fact that he lives only thirty minutes away from the hospital.Id. D'Amour developed headaches and light sensitivity and reported problems with short term memory, focusing, and concentration.Id. Subsequent brain scans continued to show no abnormalities and D'Amour was diagnosed with post-concussive syndrome.Id. at *1-*2. Several months later, D'Amour's symptoms worsened and he began suffering from depression as a result of his inability to work.Id. at *2. D'Amour was eventually diagnosed with major depression and adjustment disorder with depressed mood.Id. at *2-3. In denying D'Amour's request to add post-concussion syndrome to his compensable claims, the Board of Review relied upon one physician who believed that D'Amour was not a valid reporter of his symptoms even though four other physicians had concluded that it was the proper diagnosis. Id. at *3-4. The West Virginia Supreme Court decided that such a finding was clearly wrong based upon the evidentiary record and determined that post-concussion syndrome and concussion were compensable.Id. at *4.

In Riley v. All. Coal, LLC, No. 18-0586, 2019 WL 2406701 (W. Va. May 30, 2019), a coal miner appealed a Board of Review decision denying the addition of post-traumatic stress disorder to his claim. Mr. Riley was injured on the job when rocks fell from the veiling and struck his helmeted head. Id. at *1. The claim was initially held compensable for concussion and bilateral upper extremity numbness.Id. Subsequently, Riley reported problems with behavior, sleep, memory, and anxiety and was found to have met the criteria for PTSD.Id. Riley was evaluated by three doctors and his PTSD was confirmed by two. The third doctor determined that Riley had reached maximum medical improvement, but deferred an opinion on Riley's psychological stated because he was not qualified in that area.Id. at *3. The West Virginia Supreme Court held that there was sufficient evidence linking Riley's PTSD to his compensable injury. However, the employer did not get an opportunity to evaluate Riley with their own physician so the court remanded the case for further evidence. Id. at *3-4.

By: Joe Unger and Dill Battle

2019 West Virginia Legislative Session

Legislation Introduced Impacting Workers' Compensation

By: Karin L. Weingart

January 18, 2019

Spilman Thomas & Battle, PLLC

Senate Bill 74:  Establishes that unpaid volunteers for ski area operator or for ski area sponsored programs would be exempt from workers’ compensation benefits.

• Code Provision: §23-2-1a
• Sponsor: Senator Cline (R)

Senate Bill 114 and House Bill 2321:  To recognize post-traumatic stress disorder without physical injury for First Responders as an exception to the law that mental injuries without physical injuries are not compensable (so-called mental-mental claims).

• Code Provision: §23-4-1f
• Senate Sponsors: Senators Romano (D), Jeffries (D), Baldwin (D), and Lindsay (D)
• House Sponsors: Delegates Lovejoy (D), Miller (D), Canestraro (D), and Rohrbach (R)

House Bill 2365:  To amend the definition of employee to conform to Internal Revenue code provisions, with specific reference to the 20-factor test used by the IRS.

• Code Provision: §23-2-1a
• Sponsors: Delegates Foster (R), Higginbotham (R), Fast (R), Linville (R), Pack (R), Steele (R), Phillips (R), Shott (R), Summers (R), Kessinger (R), Cadle (R)

Senate Bill 144:  Establishes a West Virginia State Black Lung Program to award benefits for pain and suffering for occupational pneumoconiosis. Ten years of exposure and a chronic respiratory disability (disability does not need to be total) provides a conclusive presumption of entitlement to pain and suffering benefits. Benefits are paid at a base rate of $300 per month, with an increase of $20 for each year beyond the initial 10 years. Recipients will also be permitted to claim the benefits as a credit against state income tax. A separate fund is to be established for payment of the benefits through an additional severance tax imposed on  coal, natural gas or oil, and generation of electricity by wind or solar device.

• Code Provision: §23-4D-1 et seq. (This is a new article to be added to Chapter 23)
• Sponsors: Senators Ojeda* (D) and Stollings (D)
  
  * Resigned his Senate post to make a bid for the 2020 US Presidential Primary
• NOTE: Similar legislation introduced at least once in previous sessions garnered no momentum.

Senate Bill 260:  Reinstates 5% award for a diagnosis of occupational pneumoconiosis without measureable impairment. Adds a new provision granting a 25% PPD award for a diagnosis of massive fibrosis or complicated pneumoconiosis without impairment. This provision includes an offset from any future PPD award recommended by OP Board. (No such offset for the 5% award.)

• Code Provision: §23-4-6a; §23-4-26 (New)
• Sponsors: Senators Stollings (D), Jeffries (D), Prezioso D), Takubo (R), Hamilton (R),     Lindsay (D), Maroney (R)

Senate Bill 2:  Establishes an Intermediate Court of Appeals and eliminates the Workers' Compensation Board of Review.

• Code Provision: §23-5-10; §23-5-11a (New); also impacts Chapters 3, 29A, 51, and 58
• Sponsors: Senators Trump (R), Boso (R), Takubo (R), Weld (R), and Cline (R)

A Second Bite of the Lemon in West Virginia - Appellate Review and Aggravation of Preexisting Injury

In Arch Coal, Inc. v. Lemon, No. 17-0152, 2018 WL 2470654 (W. Va. May 30, 2018), the Court took the unusual procedural step to reverse a prior ruling and granted the appellant's motion for reconsideration of the Court's memorandum decision. The West Virginia Supreme Court of Appeals ruled the Court's prior opinion, reversing a decision by Worker's Compensation Board of Review, incorrectly applied the
appellate standard of review. Therefore, the court affirmed the Board of Review's decision that the claimant's injury was compensable.
This case is important to carriers for two reasons. First, the court clarifies the "discreet new injury" argument by applying the theory to new facts and rearticulating the rule. Second, the finding provides an example of how courts can grant benefits in a close case through the application of the correct standard of review.

The underlying injury was sustained by a general laborer at a mine, who had previously complained of back pain and had an MRI revealing mild concentric bulging. The claimant alleged, while driving a shuttle car, he hit a hole in the ground and bounced out of his seat. On landing, he claimed his back hurt so badly he could not breathe. Shortly thereafter, he left work early. After seeking treatment from a chiropractic physician, he was diagnosed with a disc protrusion and nerve root compression. A subsequent MRI revealed a herniated disc and bulge. The claimant filed the Employees' and Physicians' Report of Occupational Injury or Disease, claiming he injured himself in the course and scope of his employment, and the chiropractic physician likewise, designated the injury as occupational. However, the claim administrator denied the claim, because it was not work-related and was a result of a chronic condition. Subsequently, the claimant pursued additional medical reports and received a discectomy by a neurological surgeon. A physician, other than the surgeon, completed a Record Review and Opinion indicating that the claimant's injury was not traumatic in origin, but, "was the consequence of progressive, pre-existing degenerative disc disease." Id. at 4, 2018 WL 2470654 at *2. Finally, a diagnostic specialist conducted an Age of Injury Analysis and MRI Comparison and "concluded that [claimant's] condition was due to a progression of degenerative disc disease with chronic disc herniation…" Id.

Based on the additional medical reports, the Administrative Law Judge of the Office of Judges reversed the Claim Administrator. The ALJ found that, although some of the evaluating physicians concluded the condition was degenerative, the MRI after the alleged injury established the claimant exhibited a "right lateral disc herniation and disc bulge at L4-5…" The judge concluded the herniation "could certainly explain the claimant's assertion of severe low back pain…", and therefore, found the claim was compensable. Id. at 6, 2018 WL 2470654 at *3. The Worker's Compensation Board of Review adopted the findings and conclusions of the ALJ and affirmed the decision.

After appeal, the Supreme Court of Appeals "issued a Memorandum Decision in which [they] determined that the evidence showed that [claimant] did not sustain a work-related injury…" reversing the Board of Review decision. Id. The claimant asked the Supreme Court to reconsider its Memorandum Decision for failure of the court to "afford proper deference to the findings of the Administrative Law Judge and Board of Review." Id.

To begin their analysis, the court recognized that the standard of review for a worker's compensation case is provided by W. Va. Code § 23-5-15(b) which states a Supreme Court of Appeals decision that reverses or modifies a decision by the Commission or Office of Judges can only be reversed or modified if the decision "is in clear violation of constitutional or statutory provisions, is clearly the result of erroneous conclusions of law, or is so clearly wrong based upon the evidentiary record that even when all inferences are resolved in favor of the board's findings, reasoning and conclusions, there is insufficient support to sustain the decisions." Likewise, the statute states "the court may not conduct a de novo re-weighing of the evidentiary record." W. Va. Code § 23-5-15(b). In addition, the court is required to "state with specificity the basis for the decision" and how it falls under one of the three categories. Id. Finally, any issue regarding benefits shall be resolved by a preponderance of the evidence.

With this standard in mind, the previous Supreme Court of Appeals decision incorrectly stated the issue. Instead of asking whether the claimant's injury was properly found to be non-compensable, the court should have asked whether the decision of the Board of Review, favorable to the claimant and based on the evidentiary findings of the ALJ, should be affirmed, reversed, or modified pursuant to the standard of review found in W. Va. Code § 23-5-15. The court recognized that, in addition to the incorrect framing of the issue, the Memorandum Decision likewise failed to include an analysis stating "with specificity the basis for the decision" and how it falls under one of the three categories.

In addition, the court held the ALJ's finding of compensability was, in fact, based on the preponderance of evidence. The prior Supreme Court of Appeals decision failed to address the chiropractic physician's statement that the MRI indicated a new injury at the L4-5 nerve root compression. The court recognized it almost entirely based its holding on the degenerative disc disease discussion in the Record Review and Age of Injury Analysis, but that the medical evidence was "virtually unanimous in establishing [the claimant] did not have a herniated disc prior to [the date of injury]". Id. at 10, 2018 WL 2470654 at *5. Other matters considered by the ALJ provided additional evidence indicative of compensability, including: a doctor's visit the day after the injury, the claimant reporting to work with a limp, statements by the claimant that his back was killing him and that after running a shuttle car his back hurt so bad he couldn't breathe, and that the claimant left work early. Therefore, the Supreme Court of Appeals held the Board of Review's order affirming the ALJ decision was supported by a preponderance of the evidence and should be upheld. 

Finally, the court recognized the accepted rule stated in Gill v. City of Charleston (2016) that “a noncompensable preexisting injury may not be added as a compensable component of a claim for workers’ compensation medical benefits merely because it may have been aggravated by a compensable injury.” "To the extent that the aggravation of a noncompensable preexisting injury results in a discreet new injury, that new injury may be found compensable." Id. at 11, 2018 WL 2470654 at *5. From this, the court held the preponderance of the evidence shows the claimant left his shift early, upon sustaining a compensable, discreet, new injury. Therefore, the Court withdrew its Memorandum Decision and affirmed the Board of Review order finding the claimant's injury compensable.

When faced with preexisting injuries or degenerative conditions, Arch Coal v. Lemon provides a few instructive practice pointers. A “discreet new injury" must be proved by preponderance of evidence. When analyzing a similar case, a claims administrator can use the Rule 20 treatment guidelines and treat a noncompensable preexisting injury which has aggravated a compensable injury. W. Va. C.S.R. § 85-20-21 (treatment of unrelated conditions).

 When does TTD overpayment actually occur in West Virginia? 

In Reed v. Exel Logistics, Inc., No. 17-0864, 2018 WL 2769041 (W. Va. June 6, 2018), the West Virginia Supreme Court of Appeals clarified the circumstances necessary for an employer to claim overpayment of temporary total disability (TTD) benefits. The question arose after the employer's claims examiner paid a claimant for an additional 156 days past the 104-week limit. The Court held this type of "overpayment" lacked the requisite statutory elements, and therefore, the employer could not seek reimbursement. 

The primary directive of this case is twofold. First, claim administrators must be vigilant in recognizing TTD overpayment. The Court will not sympathize with a carrier who has paid out more than is required. Second, claim administrators must issue the correct protestable orders to force the overpayment issues into litigation. The Court has made it clear without the satisfaction of certain procedural elements, overpayment cannot occur. A practical caveat may be of most importance - a claims administrator controls TTD under W. Va. Code § 23-4-7a(e). Claims administrators should develop a system to "red flag" TTD at 104 weeks, when TTD can be terminated or a claimant can request rehabilitation TTD if participating in an approved rehabilitation program. The facts of the Reed case are instructive. 

The claimant worked as a shuttle drive for the employer, when he stepped on the frame of a truck and slipped, fracturing his left ankle. After numerous surgeries, the claimant continued to have instability in his ankle. After two-and-a-half years of physical therapy, the claimant's doctor declared the claimant had reached his maximum degree of medical improvement (MMI) and was a candidate for vocational rehabilitation services. In response to this report, the claim examiner halted the benefits and refused to approve further physical therapy or vocational evaluations. In addition, the claimant was granted a 4% permanent partial disability award, valued at $7,553.44. Roughly six months later, the claim examiner discovered the TTD benefits should have been terminated two years after the claimant's injury, and the insurer had improperly paid the claimant for 156 days beyond the statutory limit of 104 weeks. The claim examiner maintained the insurer had overpaid $10,509.72 and refused to pay claimant's permanent partial disability, declaring the claimant had an overpayment of $2,956.28 to be credited against any future award. 

After the claims examiner notified the claimant of the overpayment, the claimant protested the overpayment order to the Office of Judges (OOJ), which reversed the order. The OOJ found the examiner failed to timely seek termination of the benefits, or otherwise comply with the laws regarding modification or overpayment of TTD benefits. The Worker's Compensation Board of Review reversed and reinstated the examiner's decision. On review, the Supreme Court of Appeals recognized the Board of Review's decision involved the interpretation of law and, therefore, analyzed, de novo, the question of whether an "overpayment" of TTD benefits occurred. 

The insurer insisted the law governing TTD benefits was clear, "no person may receive temporary total disability benefits under an award for a single injury for a period exceeding one hundred four weeks." 2 W. Va. Code § 23-4-6(c). The insurer argued any benefit paid to the claimant in excess of the 104-week limit should "automatically" qualify as an overpayment. The claimant countered the workers' compensation scheme expressly limits an examiner's ability to declare overpayment of TTD benefits. The claimant asserted overpayment only occurs in a certain circumstance. First, the examiner must try to modify or terminate TTD benefits. Then, during an adversarial proceeding, which later results in a decision favoring the employer, the carrier is required to continue payment. Therefore, the overpayment only consists of the benefits awarded between the date of the attempted modification or termination and the ruling. More specifically, the claimant argued because the examiner never objected or sought modification to the claimant's TTD benefits, the excess benefits do not qualify as an overpayment. 

The Court analyzed the TTD statutory scheme, recognizing W. Va. Code § 23-4-1c(h) governs overpayment of TTD benefits, and requires two circumstances must occur for an employer to overpay a claimant. First, an employer must timely object to an order denying an application for modification or termination of TTD benefits. Second, there must be an adversarial proceeding which results in an order that the claimant was not entitled to TTD benefits. 

However, before the court could dismiss the employer's argument, the employer asserted that the overpayment statute was "a meaningless relic of a bygone era." Reed, at 9, 2018 WL 2769041 at *5. The employer claimed that employers no longer object to the decisions of private insurance carriers, but instead, the carrier has sole authority to act on the employer's behalf in all litigation related aspects of the claim, and enter final decisions. The claimant responded to this argument by asserting that a claims representative for an insurer is still the representative of the employer, and that the workers' compensation scheme allows the representative to make applications for a modification of any award made to an employee of the employer, including to modify or terminate TTD benefits. The claimant reiterated that W. Va. Code § 23-4-1c(h) delineates a clear process for overpayment which requires the employer or its representative to object to an order denying modification or termination and a final decision in the employer's favor. As neither the employer nor the claims examiner gave notice, objection, or an appealable order indicating the benefits should be terminated, an overpayment did not occur. 

The court agreed with the claimant and outlined the legislative history of the TTD benefits modification process prior to 1974 amendment, currently enshrined in W. Va. Code § 23-4-1c(h). Previously, the payments of TTD benefits were halted immediately after an employer protested, which would cause substantial economic hardship on the claimant due to the extended adversarial proceedings. The Legislature amended the statute for the purpose of limiting the employer's ability to "stymie a claimant's receipt of temporary total disability benefits." Id. at 11, 2018 WL 2769041 at *6. Based on this history, the court held that W. Va. Code § 23-4-1c(h) provides a baseline that once a claimant has been awarded TTD benefits, the claimant continues to receive those benefits until the employer (or representative) properly seeks to modify or terminate them. Then, while the order is under review, the 3 employer must still continue to pay the TTD benefits. But if the claimant is later found not to be entitled, only then does an overpayment legally exist. In the instant case, the Court found the examiner did not follow these procedures and, therefore, an overpayment did not exist. 

Justice Walker dissented from the majority, claiming the majority conflated the overpayment of claimant's benefits pursuant to § 23-4-6(c) and the dispute of his initial entitlement to TTD benefits pursuant to § 23-5-1. The dissent argued that any discussion of § 23-4-1c(h) is unnecessary because the section applies only where the Commissioner, in a §23-5-1 proceeding, determines the claimant was not originally entitled to TTD benefits because the claim did not jurisdictionally qualify. The purpose of a protest under a § 23-5-1 proceeding is to dispute the claimant's original entitlement to TTD benefits, not the overpayment of benefits to an originally entitled award. "Exhausting one's statutory entitlement to TTD benefits is different from failing to satisfy the jurisdictional requirements necessary to qualify for workers' compensation benefits, initially." Id. at 3 (WALKER, J., dissenting). Therefore, the claimant simply received TTD benefits to which he was not entitled and must repay those benefits. 

The lessons of Reed are that a claims administrator should be proactive about TTD closures at 104 weeks, be mindful of W. Va. Code § 23-4-7a(e), and issue timely suspensions and closures where appropriate. 

  West Virginia Supreme Court Impeachments - Latest Developments and Update

August 14, 2018

 August 14, 2018 update

 There have been significant developments in recent days regarding the Articles of Impeachment brought against the four remaining Justices of the Supreme Court of Appeals of West Virginia.   

 On August 9, 2018, Chief Justice Workman issued an Administrative Order temporarily appointing the Honorable Paul T. Ferrell, Judge of the Sixth Judicial Circuit, to serve on the Supreme Court during Justice Loughry's suspension. Judge Ferrell's assignment commenced immediately and will continue until the Chief Justice determines such assistance is no longer necessary. Justice Workman's Order further notes that should the Articles of Impeachment brought forth by the House Judiciary Committee proceed to the Senate for trial, Judge Ferrell will serve at the Acting Chief Justice for any impeachment proceedings. 

 On Monday, August 13, the House of Delegates convened for a 14-hour floor session and voted to adopt eleven separate Articles of Impeachment put forth by the Judiciary Committee. 

 Following the votes in the House of Delegates, on August 14, 2018, Justice Robin Davis announced her immediate retirement from the Supreme Court. Justice Davis's retirement means that the unexpired six years of her term (until 2024) will also be on the ballot in the November 2018 general election. As previously reported, Justice Ketchum's seat will also be on the ballot in the November 2018 general election. Prior to that election, Justice Davis's position on the Supreme Court could be filled by an appointee of the Governor of West Virginia, or Chief Justice Workman could fill the seat through use of temporary appointment powers.

The remaining articles of impeachment approved by the House of Delegates against Justices Loughry, Walker, and Workman will go to the State Senate for trial. At this time, there is no timetable for any proceedings before the Senate, however, impeachment of any Justice would require a 2/3 vote in the Senate for conviction and potential removal from office. 

 The Supreme Court's Fall Term is scheduled to begin on September 5, 2018.

 If you have specific questions, reach out either to your Spilman contact, or Andrew P. Arbogast (Chair, Litigation Department), or Don C. A. Parker (Chair, Appellate Group) for more information.