The California Applicants Attorneys Association held its Winter Convention at the Westin Resort in Rancho Mirage. It was fairly well attended, though I think attendance was down a bit from the past two years. The mood seemed more upbeat. Here, for your reading pleasure, is my summation of each of the sessions. There is a convention notebook in my office, as well as a CD, containing a lot of material that is worth copying. Help yourself to it. I will try to point out along the way items you may want to copy from the notebook.
“Working with MPNs”
The first speaker was a local applicants’ attorney. He stated that he did not think that the MPN system was working very well. Treatment is being denied and delayed. Appropriate treatment is not being provided to applicants. He focused on Rule 9767.12 and asserted that if the defendants failed to comply completely with the requirements of that Regulation then the applicant could opt out of the MPN and would be free to choose his own doctor.
He admitted that there is no authoritative case to support that assertion, but he cited two Panel decisions, with which we are familiar, to support it. He cited the Sandhagen case, which states that utilization review time deadlines are mandatory and that failure to comply with the strict timelines precluded a defendant from using utilization review. He would analogize the Sandhagen case to the requirements of Rule 9767.12.
He also analogized to the recent case that held that a failure on the part of defendants to post proper notices regarding the MPN automatically permitted the applicant to free-choice a doctor. He conceded that cases will have to be taken up on appeal to test his theory.
However, he then went on to state that there are many good doctors in many of the networks set up by defendants. He stated that it might not be worth the effort to fight a defendant over the MPN in a given case. He suggested that applicants’ attorneys check out the list of doctors in the network. He has found that there are many applicants’ doctors on these lists. Treatment by a doctor within an MPN limits defendants in some important ways. For instance, a defendant cannot petition for a change of treating doctor, cannot stop treatment very easily, and must go through 4062 procedures to change a doctor or to limit treatment.
This latter point is in contrast to what we heard at the CWCI Seminar where the speakers indicated that the 4062 procedures are not available to a defendant to challenge treatment by an MPN doctor. Thus, this particular applicants’ attorney at least, is of the opinion that in many cases it may be better to simply work within the MPN.
A defense attorney also spoke. In contrast to the prior speaker, he stated that it is his experience that there is far more fear about MPNs than is warranted. The carriers have indicated to him that the MPNs are working well. He conducted an informal survey of his clients. They tell him that there has been very little in the way of applicants choosing to go to second- and third-opinion doctors within the network, and that the appeal process is almost never used. He pointed out that if a carrier or an MPN doctor is ignoring the applicant or not providing appropriate treatment then the applicant is allowed to simply switch doctors and even may be allowed to get out of the network altogether. He thinks, however, that frequent doctor-switching within an MPN will eventually be the subject of litigation and should be limited by some kind of “reasonable” test.
In other words, applicants will not be able to change doctors every other day until they find one they like. He does believe that strict compliance with Rule 9767.12 will be strictly construed by the Workers' Compensation Appeals Board should a case go up on reconsideration. He thinks that if the
defendants do not comply fully to the letter with this Rule, then an applicant will probably be allowed to self-procure medical treatment with a doctor of their choice out of the network.
He also stated that he has found that many of the doctors on MPNs’ lists do not even know that they are on the list! He does not anticipate much litigation over this issue. He stated that we should all give it time to work. Many of the problems that exist now will eventually be ironed out, and we should be patient.
Another local applicants’ attorney spoke next. She recommended that when an applicant first comes in to see an applicants’ attorney immediate contact with the adjuster should be made. She recommends trying to get an agreement on an AME early in the case. She has found that many of the doctors in the network are not able to write an admissible and substantial report, so early agreement on an AME to address problems as they arise is a good practice.
She also gave a list of some ten different ways that she thinks gives the applicant a right to opt out of a network. It is her position that if the defendants have not rejected a claim they are supposed to provide up to $10,000.00 of treatment. If the applicant is not getting treatment before the claim is rejected, the applicant can opt out. If a request for a change of doctor is not honored by the defendant within five working days, the applicant can opt out.
Failure to provide a Claim form within one working day is grounds to opt out. If the applicant reports a claim and is not scheduled for an examination within three days, the applicant can opt out. Any violation of Rule 9767.12 is grounds for opting out of the MPN. Also, failure to give notice to the applicant of a right to an attorney or to consult an Information and Assistance Officer is grounds to opt out. Her position essentially is that an violation no matter how minute is a way to get out. Of course, any doctor who takes on an applicant under such circumstances is taking a big risk that they won’t be paid should the courts disagree with her. CAAA’s track record at the Court of Appeals level lately has been dismal.
She went on to say, however, that utilization review will be applicable to the doctor who is treating the applicant whether he is in the network or out of the network, so it is not necessarily a good idea to get out of the network just because there has been a denial of treatment or some technical violation of a statute or rule. However, utilization review in her experience is usually not done properly or timely. She recommends simply filing for an Expedited Hearing when UR gets in the way of treatment
recommendations.
She believes that the number of changes of treating doctors that can be made within the MPN is limitless. When the MPN doctor is not providing proper treatment, or if treatment is denied, simply pick a different doctor from the network. She recommended against going through the second- and third-opinion process. Then when an applicant actually does return to work, the applicant should immediately predesignate the doctor they like from the network.
Finally, she pointed out that defendants have lost the right to petition for a change of doctor if the applicant is treating within the network. This is another reason to stay in the network.
An interesting hypothetical was presented. If there is a cumulative trauma and a specific injury pled, what happens if the specific injury is admitted to say the back; but the cumulative trauma is denied and alleges injury to the back and the upper and lower extremities? What if the defendants admit liability for treatment to the back, but the applicant needs treatment for the other body parts? This was batted around a bit without any real answer to the question---probably because there isn’t one. The conclusion of the panelists was that we may see situations where there are two treating doctors: one for the admitted back in an MPN and another outside the network for the back and the other body parts! Great!
“Reconsideration and the Appellate Process”
This was simply a “nuts-and-bolts” session, much of which has been covered extensively in previous conventions. The outline in the syllabus is very good. I’d recommend copying it. Two commissioners on the WCAB were on the panel as well as an Appeals Court Judge.
Much of what the panel had to say involved routine internal procedures about what happens to a case when it comes in, how it is assigned, how it is decided, etc. The commissioners indicated that there are a lot of new types of issues coming before the Board involving SB 899. In fact, interpretation of 899 is taking up the vast majority of the time analyzing reconsiderations by the Board.
It was recommended that the litigants in a case specifically and clearly indicate in their Petitions for Reconsideration several points. What exactly are you appealing? What is the basis for the request for relief? What is the statutory basis for the appeal? Outline your contentions in a very clear, concise, and factual manner. Do not make up facts. State what the problem is with the ruling. Do not be wordy, and list your contentions separately. List just the pertinent facts, and present them honestly. You should include facts that are not convenient to your position. If you leave out pertinent, relevant, and
inconvenient facts, you will hurt your credibility on appellate review. You should quote the pertinent portion of the statute that applies. State why the facts of your case apply to the statute and how the ruling should come out. Cite cases that are on point, and apply the cited case to your facts.
The Appellate Court Judge pointed out that Courts of Appeals’ Judges do not often know very much about workers’ compensation, so you will have to educate them. You need to motivate the Court to act. You should present the issue in terms that will get the attention of the Court of Appeals. Things such as the importance of the issue to the entire state, policy considerations, and issues concerning the entire workers’ compensation community should be stressed.
If there was a dissent at the WCAB level, use the arguments of the dissenter in your argument before the Court of Appeals. Recognize the negative aspects to your claim, and do not ignore them. There has to be a full and fair presentation of the facts if you hope to get the attention of the Court of Appeals. If you ignore inconvenient facts, you will lose credibility. An appeal, or a Petition for Reconsideration, should be civil. Do not attack a judge or another party’s attorney personally.
The WCAB’s commissioners stated that they are starting to see Permanent Disability Rating Schedule issues arising before the Board. There have been some ACOEM issues but not that many as yet.
Before the Court of Appeals, you should use the “rules of statutory construction” (see syllabus) in your argument because those rules are going to be a very big part of the Court trying to figure out what SB 899 means. The Court of Appeals Judge stated that workers’ compensation issues are starting to take a lot of court time.
Finally, the two commissioners indicated that they have already discussed the decision of the Workers’ Compensation Judge out of San Francisco who recently decided that the PD Rating Schedule only applies to injuries occurring after January 1, 2005. Two commissioners already are diametrically opposed on this issue, so stay tuned.
“Use of Experts to Prove Diminished Earnings Capacity”
A Northern California applicants’ attorney took the lead on this panel. He asserts that the Rating Schedule proves nothing. It has nothing to do with proving diminished earnings capacity. The AMA Guidelines themselves do not evaluate diminished earnings capacity, and they say that. The Rating
Schedule itself is only prima facie evidence of permanent disability. It is a rebuttable presumption, and applicants have the absolute right and applicants’ attorneys the absolute duty to rebut the Rating Schedule. Just as the old Schedule could be rebutted, the new one can too.
Previously, cases that were in the 80% permanent disability range or so would be subject to a LeBoeuf argument that the applicant was 100% precluded from the open labor market. However, now that the AMA Guides are being used to assess permanent disability under the new Schedule, lower permanent disability levels will be subject to a LeBoeuf-type argument that the applicant’s actual future diminished earnings capacity is higher than the rating would produce.
One of the panelists was a former vocational rehabilitation counselor who is now doing work as an “expert” in diminished earnings capacity. She claims that she will take a case and analyze it using government statistics and other empirical data and tailor her report to a specific injured worker, considering their skills, abilities, age, experience, and the labor market.
An applicants’ attorney on the panel presented a hypothetical where an injured worker has a failed back syndrome. Under the AMA Guidelines, the applicant can only hope to obtain a 30% rating. However, under the old system, their permanent disability might be around 80%. He further hypothesized that a bank president who has a failed back is in a completely different situation than a common laborer with a failed back. The bank president may have no loss of earnings capacity, but the laborer may be totally disabled. Therefore, he concludes the Schedule is inaccurate and has to be rebutted.
This same attorney stated that he has already had three trials on this issue, but has not seen any decisions as yet. However, he did point out that in one case even the defense expert on diminished earnings capacity agreed on cross-examination that in his analysis the applicant had a much higher rating than the Schedule produced.
The syllabus contains a lot of material worth copying. There are sample responses to a
defendant’s Motion to Strike a vocational expert’s testimony and reports. There is also a detailed brief with points and authorities which is a good synopsis of CAAA’s arguments as to why they are entitled to use experts on diminished earnings capacity. There was a lot of discussion about who would pay for these so-called experts. The panelist is doing it on a retainer basis. It is going to be quite expensive. The applicant’s attorneys on the panel feel rather strongly that this is a medical-legal cost that should be borne ultimately by the defendants. However, applicants’ attorneys are going to have to outlay the funds up front to retain such experts.
Finally, there was a discussion about using agreed-upon vocational evaluators. The panelists rather strongly hinted that if the defendants do not agree to an expert then what an applicant’s attorney should do is refuse to supply the defense expert the private medical records of their client. An applicant’s medical records are private. Without authorization, it is a violation of a number of state and federal laws to disseminate such medical information to a defense expert.
Of course, all of this discussion avoided the rather obvious problem, which is that a lot of people on the defense side do not even believe that experts can be used or at least not former voc rehab
counselors. The Rating Schedule itself provides for diminished earnings capacity. It will take some cases going up to the Appeals Court level, if not the Supreme Court itself, to decide the issue. However, from the panel discussion, it would appear that there are defendants out there retaining experts to rebut applicants’ experts on diminished earnings capacity. Also, there are apparently some defendants in certain cases who have agreed upon a vocational expert. Stay tuned….
“Back to Basics”
This session was not a total waste of time but pretty close to it. Much of the discussion had to do with an applicant’s attorney’s intake interview with an injured worker. Because of the changes in the law, the intake interview should cover additional information that applicants’ attorneys did not previously obtain from their clients. Now there is a positive duty on the part of applicants to reveal past injuries. Since applicants’ attorneys now seem to believe that expert witnesses on the issue of diminished future earnings capacity are the wave of the future, they should interview their clients concerning their educational background, work experience, and past earnings and how their injuries have affected their activities of daily living.
If applicants’ attorneys ultimately prevail and the Courts do agree that they can rebut the Rating Schedule with expert testimony, then we are going to have to get more detailed in our deposition questions concerning these issues as well. We may also have to obtain Social Security records in every case in order to establish the applicant’s earnings record.
Otherwise, this session put a lot of people to sleep. “What is Substantial Evidence?”
The written material in the notebook is actually quite good on this topic. There is a detailed outline put together by two WC Judges, a defense attorney, and an applicants’ attorney, who were all on the panel. There are a number of case citations, Rules, and Code Sections broken down into different categories. The outline is quite good, and I would suggest that everyone make a copy of it.
The oral presentation was a little bit disorganized unfortunately. It was hard to take notes because the panelists kept jumping in on each other, changing the subject, and bouncing around from one topic to another. Therefore, the following may not sound very organized either.
One of the panel Judges said that when you file a Petition for Reconsideration the best way to approach your argument is to point out to the WCAB that the WCJ relied on evidence that is non-substantial evidence. For example, did you know that a QME has to spend a minimum of 30 minutes of face-to-face time with an applicant under Rule 49.9? She said that she has thrown out QME reports where the applicant did not actually spend 30 minutes with the doctor.
The ACOEM Guidelines are presumed correct. However, when the utilization review doctors deny treatment based upon them, the citation to the book has to be specific. Otherwise, the report is not going to constitute substantial evidence.
A second opinion from a doctor for purposes of spinal surgery must involve an actual examination of the applicant by the doctor, otherwise the report is garbage.
Then there was some discussion about the recent case out of San Francisco concerning the use of the new versus the old Rating Schedule. One panelist Judge indicated that she agreed with the Judge in San Francisco. However, the other Judge on the panel said that there was a recent two-to-one panel decision just out on that issue and that it was contrary to the San Francisco Judge’s opinion. It was a case that arose out of San Diego. (The case was first seen on WorkCompCentral during the CAAA
convention).
In that panel decision, there had been a report from a treating doctor in April of 2004. An MRI of the spine and the shoulder had been done. There was eventually surgery done on the right shoulder. All of this occurred before 2005. The applicant was permanent and stationary in 2005. The parties could not
agree as to which Schedule applied. Under the old Schedule, the applicant rated 59% and under the new one, 26%. The WCJ in San Diego found that the old Schedule applied because of the treating doctor’s report in April of 2004. The WCAB, however, ruled that there was no substantial evidence of the existence of permanent disability in 2004 and that therefore the new Schedule applied.
There was a brief discussion about all those “medical reports” that came out on virtually every case in December of 2004 stating that there was the “existence of permanent disability.” It was everyone’s opinion on the panel that those probably do not constitute substantial evidence.
On apportionment, one panel Judge stated that a WCJ can use a range of evidence when it comes to assigning an apportionment percentage. She does not believe that the Judge has to follow one doctor’s opinion or another’s. She can find the apportionment percentage to be whatever she thinks is reasonable, however, Judges do have to have something substantial in the record to base the apportionment on.
The defense attorney on the panel discussed the recent Sherman case (the one where the applicant’s preexisting rheumatoid arthritis was lit up by the industrial injury and thus was 100% work related). He distinguishes this case from Escobedo, which, of course, said that there can be
apportionment to causation by preexisting nonindustrial and nondisabling conditions. Sherman is not the final word and is not a controlling precedent necessarily in his opinion. That is because the case turned on an AME report that was followed by the Judge and that said that the applicant’s disability was lit up by the industrial injury and apportioned 100% to the industrial injury. The outcome of the Sherman case might have been different if the AME had apportioned something to the preexisting nonindustrial condition. All Sherman tells us is that an AME can apportion nothing to a preexisting condition. “Most Significant Cases”
The usual group of panelists presented their spin on some of the significant cases that have come out in the last year. This group had a full one and a half hours to discuss about ten cases, but they did not even finish.
The first case talked about was the Dykes case. Naturally, the applicants’ attorneys think that this is a significant victory. They went on an on about why the Dykes Court felt no longer bound by the Fuentes case. They highlighted the language in the Dykes decision about how Fuentes directly relied on the old apportionment statute, which was repealed with SB 899. They did point out, however, that the Court was careful to limit its ruling to the particular situation; that is, the applicant had both of his injuries with the same self-insured employer. They feel that Fuentes is gone and that the same result will occur in other circumstances that may go up on appeal.
They also like the language in Dykes, which compels the application of Labor Code Section 3202 to SB 899. They all went on and on about how this concept has been forgotten by the Court of Appeals in recent cases (which CAAA has been losing left and right). They said that this liberal construction
language should be strongly stated and the Dykes case cited in every Trial Brief, Petition for Reconsideration, and Appeal.
At the end of almost half an hour of praising the Dykes case, somebody on the panel said that the defendants had ordered transcripts of the Court of Appeals case, and that can mean only one thing: The case is being appealed to the Supreme Court. After all of that, we may not have the final word on Dykes.
There was a brief discussion about the Nabors case. That is the one where the WCAB issued an en banc decision holding that Fuentes is still good law. Not much was said about it. It was pointed out that a Writ of Review has been granted and that the parties to the case had been requested to submit briefs concerning the significance of the Dykes ruling.
During all of this discussion, some wise guy from the audience, probably a defense attorney, sent a question up to the panel that was read. What if the applicant has an Award and within five years petitions to reopen? Now the applicant has more permanent disability. However, because of the apportionment to causation statute, the permanent disability is less now than the prior Award. Can defendants file a Petition to Reduce? About all they could say was that that is a good question, and applicants’ attorneys should carefully consider whether or not they want to open that can of worms by filing a Petition to Reopen a case because it can backfire. They seem to be of the opinion that the applicant might lose on a Petition to Reduce.
Moving on, they talked about the Sanchez and Strong cases. Those are cases about overlapping disability and Labor Code Section 4644. The Sanchez case is the one where the applicant was awarded 7% permanent disability for a foot injury even though she had a prior Award of 22% to her knees. In Sanchez, there was no basis for apportionment because the disabilities did not overlap.
In Strong, there were prior Awards to separate regions of the body. However, the Board found that the disabilities overlapped one another and therefore were subtracted from an overall 70% rating. The applicant had a 34.5% knee Award for the first injury. A second injury got him a 42% Award for a light-work limitation to his left shoulder, left knee, left ankle, and right wrist. Finally, he suffers a back injury and is given a semisedentary work restriction. The WCAB in an en banc decision subtracted the light-work restriction from the semisedentary restriction and gave him a 10% Award. This one is on appeal, but there is no word from the Court of Appeals as to whether the Writ has been accepted.
There was some more hypothesizing following the discussion of this case. A question was raised as to what happens when the prior Awards were based on a different Rating Schedule, different methods of determining the standard, etc. If the applicant has another injury after January 1, 2005, and the AMA Guides apply, how can there be apportionment? The Judge on this panel is of the opinion that there is no way to subtract the old Awards from a new Award under the AMA Guides. The way he put it is you cannot subtract apples from oranges. Those types of cases are going to fall into the 4663-type apportionment, because completely different methods were used to come up with old Awards.
Furthermore, this Judge is of the opinion that there is now in existence no Labor Code section that allows apportionment to disability to a different body part. For example, if someone had a prior
nonindustrial back injury while playing football, has a no-heavy-lifting restriction that he adheres to, gets occasional treatment for, and has ongoing symptomatology, there can be no apportionment if the
applicant sustains an injury to his hands and winds up with work restrictions that include no heavy lifting. He says you cannot apportion to the preexisting disability because there is no Code Section that allows it to a different body part.
Another hypothetical question was posed, again probably by some wise-guy defense attorney. Let’s say an applicant has a 61% Award for a 1980 injury and then has another injury 25 years later and is now 62% disabled. The 1980 Award was worth only about $30,000.00. However, today’s Award would be about $80,000.00. Why should the applicant get a $50,000.00 windfall because he has 1% more disability now than before? Well, the panelists just sort of said, “Too bad. The applicant probably was not compensated enough the first time around, so the questioner just needs to get counseling!”
The final two cases that the panelists had time to discuss briefly were Rewald (70 CCC 897) and Simmons (70 CCC 866). Rewald was the Writ-denied case that stood for the proposition that an AME’s recommendation for treatment rebuts a utilization review determination regardless that the treatment does not follow AECOM guidelines. The Simmons case was an en banc decision stating that the report of a UR doctor is not admissible beyond the question of appropriateness of care because the UR doctor has not
actually examined the applicant. The UR doctor has no standing to comment on the issue of industrial causation, disputed body parts, etc., because there was no exam of the applicant.
“Legislative Panel”
Usually when this panel session starts, there is a mass exodus by defense attorneys and others who do not want to sit through what essentially is a political rally. This time around, however, I was kind of surprised that there was no attempt to collect money. Maybe CAAA has finally learned that pouring tons of money into the pockets of politicians buys them nothing but grief. Anyway I was curious to see what CAAA might be up to legislatively, and so were many others. So, this session was actually fairly well-attended.
In the end, however, there is not much that CAAA is planning on doing legislatively. There are two ideas that they are going to pursue. One is a correction of the statute concerning the Permanent Disability Schedule that will hopefully make the Permanent Disability Schedule more fair by taking into account future loss of earnings capacity. CAAA’s position, of course, is that the current Schedule does no such thing. One of the legislators who spoke said that in February there will be a committee hearing on that issue, and he hopes that legislation will be put through and signed by the Governor before the end of the year. He made no promises. He also claimed that certain legislators are committed to revisiting workers’ compensation but then followed with nothing but the usual diatribe against insurance companies and no specifics.
The only other specific idea being advanced is by a local Senator. The Police Officers Union has asked him to introduce a bill that carves them out of the new system and provides that they are subject to the old system. He is going to be doing that shortly. They fully expect the Governor will veto it. However, they are going to use it in the next campaign against the Governor, who claims he really cares about peace officers but then does not take care of them.
Unfortunately, that was about all there was to this session of any substance. A full 45 minutes were taken up by CAAA’s political advisor. He discussed the various Assembly and Senate Districts and the races in those districts and who stood a chance to win, etc. The long and short of his presentation is that he is hopeful that more Republicans will be thrown out of office and that when the Democrats take over the Governor’s office happy days will be here again.
“Understanding the Medical-Legal Consequences of Sleep Disorders”
There is not much to say about this session. It was long and boring. Every so often there was a joke about how the lecture was putting everybody to sleep. However, there were a few points worth mentioning.
Applicants’ attorneys were encouraged to get out their AMA Guides, start reading them from cover to cover, marking them up, dog-earing pages, studying them, and getting to know them inside and out. There are all sorts of little nuggets of information in the AMA Guides that can add significant amounts of permanent disability. For example, there should be an investigation on every back claim into whether or not the applicant’s sleep is being affected. If you look at the AMA Guides, you will see that severe sleep apnea can go as high as a 90% whole-person impairment. Sleep disorders really have an effect on the whole person. The activities of daily living are greatly affected by pain and can lead to all sorts of other problems including high blood pressure, diabetes, etc.
The point is that the panelist believe that applicants’ attorneys should stop complaining about a back injury being only worth a 13% standard and start looking for other ways to increase the permanent disability. A simple back claim can be turned into a sleep disorder, and who knows what else, if
applicants’ attorneys will start doing their jobs. I guess the upshot of all of this is that we can probably expect to see applicants’ attorneys suggesting to doctors that applicants should be referred out for a sleep disorder evaluation on more and more cases. I have a case where this is happening right now.
“Recent Rating Issues Including Apportionment”
Much of what was talked about in this session was already covered in the previous sessions, so not much further comment is necessary. There is a pretty good article in the notebook about the recent cases on apportionment. You might want to copy it. The attorneys on this panel have put together a sample form for their clients to sign. It is basically an explanation to the applicant of why it is not a good idea to petition to reopen the claim.
What applicants’ attorneys fear right now is the concept of what is a “finally decided case.” The problem is this. If the applicant files a Petition to Reopen for New and Further Disability, then the previous Findings and Award is arguably no longer a final Order. Under the Kleeman case, the new apportionment statutes apply to the case. The applicant may actually be subjecting himself to a reduction of the original Award. The argument goes that by filing a Petition to Reopen the applicant is in effect stating that they are seeking a new Final Judgment, and the new apportionment statutes therefore would apply to that reopening of their case.
Additionally, they are worried that defendants will be filing Petitions to Reduce and may even be filing Petitions for Reimbursement.
These problems were largely what were behind the litigation concerning the retroactivity of the apportionment statutes. CAAA lost, and these are the problems that have been created by that loss.
Respectfully submitted, Jim Juroe
