Author Archives: Gregory Grinberg

Defining the Scope of the Good-Faith Personnel Action Defense

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In a recent case, County of Sacramento v. WCAB (Michael Brooks) (2011) 13 WCAB Rptr. 193 , the Workers’ Compensation Appeal Board interpreted the good-faith personnel action defense, further clarifying its scope.  (Sorry folks, no good news is headed our way on this one…)

In California Workers’ Compensation practice, recent years have seen a growing number of psyche claims tacked on to other injuries, but sometimes as stand-alone injuries as well.  In both cases , the insurer/employer should look closely at the good-faith personnel action defense of Labor Code § 3208.3(h).

Essentially, an otherwise compensable psychiatric injury shall not be compensable for an injury “substantially caused by a lawful, nondiscriminatory, good faith personnel action.”

In the Brooks case, the applicant, a Supervising Deputy Probation Officer with the County of Sacramento Probation Department filed a complaint against a subordinate for excessive force in subduing a juvenile inmate.  An investigation followed, during which Mr. Brooks perceived a total lack of support from his supervisors and employers, and the over-enthusiastic employee filed a grievance against the applicant..

After filing an application, the parties used an Agreed Medical Evaluator who found that applicant’s psychiatric impairment, Adjustment Disorder with Depressed and Anxious Mood, was caused, in equal parts, by (1) the filing of the grievance; (2) defendant’s investigation; and (3) his feelings of being unsupported.

The Workers’ Compensation Judge found that the defense of good-faith personnel action was not met and made an award in favor of applicant.  Defendant filed for reconsideration.

On reconsideration, the WCAB affirmed the WCJ’s decision, finding two of the components causing the impairment did not qualify as good-faith personnel actions, so only 33% of the causation qualified for the defense, rendering the § 3208.3(h) inapplicable.

As the WCAB reasoned, the term “personnel action” as used in § 3208.3(h) is “conduct attributable to management in managing its business.”  The WCAB expressly rejected the position that the scope of “personnel action” encompasses “all actions by any level of personnel in the employment situation.”  (13 WCAB Rptr. 193, 194).  Among those actions not covered by the defense are the actions of one employee against a fellow or lesser employee, unless authorized or ratified by management.

Therefore, the WCAB concluded, while the investigation was a good faith personnel action, the grievance filed by applicant and applicant’s own feelings in response to his perceptions regarding management were not good-faith personnel actions.

Defendant has filed a Petition for Writ of Review, which was issued on June 23, 2011.

In reading these facts, I can’t help but think that the Board erred in its conclusion.  I agree that the process of filing a grievance might not be covered by the defense of § 3208.3, and no one is contesting the finding that management’s investigation falls well within the scope of the same.

But defendant’s approach to handling this matter, and the degree of support provided to applicant throughout the process, is a good faith personnel action in and of itself.  Therefore, applicant’s reactions to this good faith personnel action should be folded into the personnel action, and thereby be covered by the defense.

After all, every time the good faith personnel action defense has been used successfully, there must have been some reaction from the applicant to the action itself.  Perhaps the Court of Appeals shall see it the same way as does your humble author?

New Mileage Rate Increase as of July 1, 2011

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I’m sure you’ve seen/heard this already, but a friendly reminder never hurts.

As of July 1, 2011, the mileage reimbursement rate for medical treatment and medical-legal evaluations went up to 55 cents (from 51 cents).  Labor Code § 4600 (e)(2) requires the reimbursement of an injured worker’s reasonable expenses of transportation.  This is usually simple mileage for driving to and from appointments, but can also include flights and driving services.

The mileage rate is set by the Director of the Department of Personnel Administration, pursuant to Government Code § 19820.  Generally, this tracks the rate set by the Internal Revenue Service, which announced on June 23, 2011, the increase to 55 cents.

This is a relatively minor difference, but it cause a headache to deal with and give applicants more grounds to perceive themselves as wronged, especially when considering the potential for 25% penalties under Labor Code § 5814.

Fingering Subsequent Injury Fund for Liability

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California Workers’ Compensation provides a fund for serious subsequent injuries where a previous injury combines with a more recent one to cause permanent disability (PD).  (See Labor Code section 4751)

Subsequent Injury Fund’s (SIF) coffers present an additional pocket for the injured worker.

In the case of Becerra v. WCAB (2011), an applicant filed a claim for a 1999 injury to his back and psyche.  He already had a past injury that resulted in the amputation of one joint of the right index finger.  The parties used Agreed Medical Evaluators for both injuries, resulting in 67% PD for the back and 44% PD for the psyche.

Under the 1997 rating schedule (see page 7-16), these two values combine to 86% permanent disability.  The WCJ did not find applicant 100% permanently disabled on medical grounds alone.

The dueling vocational experts did not find the finger injury a factor in applicant’s lost ability to compete in the labor market.  Applicant was found 100% permanently disabled based on the medical and vocational evidence, attributed solely to the 1999 injury.

After settling his case in 2009, applicant filed a claim for SIF benefits, claiming that the amputated finger joint and back injury combined to create a greater disability – the back/psyche injury of 1999 did not make him 100% disabled, but rather 97% permanently disabled (the finger, as the theory went, did the rest).

The WCJ rejected applicant’s theory, reasoning that nothing in the record suggested any portion of applicant’s permanent disability, or vocational rehabilitation analysis, came from the missing finger joint.

The WCJ found for SIF, the Workers’ Compensation Appeals Board denied reconsideration.  The Court of Appeals’ response?  Writ of review denied.

Defendant didn’t benefit much from SIFs involvement in this case.  However, if you have an applicant with a past injury, bringing SIF in as a secondary target should always be explored.  If nothing else, more settlement money in the room means less settlement money out of your pocket!

Helllloooo Nurse (Case Manager)!

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A nurse case manager assists applicants in administering their benefits, particularly medical benefits.  This service involves scheduling appointments, coordinating transportation, and speaking with treating physicians about the nature and extent of care, often informing the party stuck with the bill, the self-insured employer or insurance company, of what’s going on.

This service is paid for by the party liable for the future medical treatment, and is one of the recognized forms of “treatment” under Labor Code § 4600, if it is “reasonably required to cure or relieve the injured worker from the effects of his or her injury.”

Bear in mind, unlike a typical nurse, a Nurse Case Manager does not provide actual treatment.  This job generally entails providing some sort of realistic anchor in speaking with the treating physicians and keeping the insurer/employer appraised of the situation.  This way, doctors are not swayed into recommending elbow surgery under a lower extremity medical award.

But who gets to choose the Nurse Case Manager, if one is to be provided?  California Workers’ Compensation law provides that an employee may choose his or her own treating physician.  (Labor Code § 4601).  Even with the Medical Provider Network limitations of Labor Code § 4616, the employee still has his or her choice of physician within the network.

As for the Qualified Medical Evaluator, the panel process outlined in Labor Code § 4062.2 controls that choice, with each party striking one of three panel physicians until there is only one left standing.  Yet the law is relatively silent as to who gets to choose the Nurse Case Manager.

Whoever controls the Nurse Case Manager controls the flow of information to the insurer and the treating physician (some of it at least).  Understandably, there is something at stake here.

In the case of Lamin v. City of Los Angeles (2004), the Workers’ Compensation Appeals Board addressed this issue, and, having procured a magician’s hat and wand, mystically waved the latter and pulled the following “preferred” process from the former:

1)      The defendant is to appoint a nurse case manager;

2)      If the applicant objects, the parties are to try to reach an agreement and appoint an “Agreed Nurse Case Manager”; and

3)      If no agreement can be reached, the Workers’ Compensation Judge is to appoint a Nurse Case Manager, considering each candidate’s (a) training, experience, qualifications, skills, and effectiveness; (b) potential conflict of interest; and (c) the recommendations of the treating physician.

It’s hard not to be cynical as a workers’ compensation defense attorney, and I’m trying my best, but the defendant is to have no control at all over this treatment?  A nurse case manager is supposed to be a professional and impartial observer, making sure the treating physicians get the actual facts and the insurer doesn’t get robbed.

Next, the applicant will demand to choose his own transportation company, his own adjusters, and (eventually) his own defense attorneys to deal with (exaggeration, I know).

The waters have been fairly calm on this issue of late, but sooner or later this issue will come forward again and hopefully we’ll get a different decision on appeal.   Have you ever had an applicant demand his or her choice in Nurse Case Manager?  Let me know:  gregory.grinberg@htklaw.com

Statute of Limitations With Teeth

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In California Workers’ Compensation defense practice, the Statute of Limitations defense is always in the back of the practitioner’s mind.

Labor Code § 5405 limits “[t]he period within which proceedings may be commenced” to one year from (a) the date of injury; (b) payment of benefits; or (c) provision of medical treatment.

A recent Writ Denied case (Barragan v. WCAB) defines the meaning of commencement of proceedings and puts some fresh teeth into the jaws of that old SoL dog.

Applicant claimed an injury to his back and neck occurred in October of 2006.  Defendant provided some medical treatment, but denied the claim in January of 2007.

Defendant took applicant’s deposition in March of 2008.

Applicant claims to have filed an Application for Adjudication of Claim on July 3, 2007, but no record of this was in the Board file, served on defendant, nor added as an exhibit at the Mandatory Settlement Conference.  Nor was this 2007 application marked for identification at trial.

The Court of Appeals declined to review the WCAB decision that a deposition does not institute proceedings.  Only an Application for Adjudication of Claim can satisfy the requirements of Labor Code § 5405.

In other words, an applicant must file an Application for Adjudication of Claim within one year of the latest of parts (a), (b) or (c) above.

A deposition does not commence proceedings, nor a request for documents, nor a letter to applicant’s attorney, nor a get-well-soon card signed by every one of the applicant’s co-workers.

I like this case for yet another reason – the applicant did not put on all the evidence he could have, namely the allegedly date-stamped application that would have defeated the Statute of Limitations defense.

But the Workers’ Compensation Appeals Board did not send the case back to the Workers’ Compensation Judge to “develop the record” and allow applicant another swing at the ball.

The MSC came and went, discovery opened and closed, and that, as they say, was that.

In other words, the Statute of Limitations defense appears to have some teeth yet.  And to illustrate this point further, here is a short video on the Statute of Limitations defense.

Limiting Applicant to One Bite at the Apple

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Have you heard the one about the applicant who tried for two bites at the apple?  The story goes like this:

The applicant claimed an injury.  His treating physician found relatively limited permanent disability, and the impairment he sustained was mostly not industrial in causation.  So he demanded a panel and got a list of three physicians.  He picked one (perhaps randomly, perhaps after an internet search of each doctor’s name).

The Panel Qualified Medical Evaluator confirmed the treating physician’s diagnosis, and the defendant-employer/insurer issued a denial notice.  So the applicant decided to call in the cavalry and lawyer up.

By the time this case reaches the applicant’s attorney’s desk, the applicant has painted himself into a corner.  With the treating physician and the PQME both finding against most of his claim, there is only one course of action – get a new panel, of course!

In California’s Workers’ Compensation system, the law is clear: only one bite at the apple.  Labor Code § 4062.1 specifically states: “[i]f an employee has received a comprehensive medical-legal evaluation under this section, and he or she later becomes represented by an attorney, he or she shall not be entitled to an additional evaluation.”

So applicant’s attorney will try to find some defect with the panel or some defect with the defendant’s conduct while applicant was unrepresented, and demand a new panel based on this.  Don’t let him get away with it!

Labor Code § 4062.3(f) gives applicant one of two mutually exclusive choices: either proceed with the evaluation as scheduled or demand a new panel.  Once applicant has set foot in the PQME’s office, the panel gravy train grinds to a halt (or should, at least, if the law has any control over the matter).

When applicant has waived every right to a new panel and proceeded with that initial evaluation, the fallback argument for the applicant’s attorney involves the following: “But my client didn’t know his rights! No one advised him!”

At that point, you take out your letters and benefits notices sent to applicant, showing the form language “you have the right to consult an attorney, etc., etc.” and you’re (hopefully) home free.

In any case, the defendant has already paid for one evaluation and had zero input on who the PQME would be.  After all, in unrepresented cases, no party gets to strike a PQME, the applicant just chooses one.  (Labor Code § 4062.1)  One bite out of defendant’s budget is plenty.

I’ve encounter some other arguments for why a formerly unrepresented applicant deserves a new panel, but that is material best left for another post.

As always, dear readers, your humble author wishes you luck in your coming trials, in court and out, and hopes this modest article has provided some assistance.

The Defendant’s Burden of Finding a Treating Physician

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Let’s say applicant has managed to wring an award of permanent total disability out of the defendant-employer.  Future medical treatment is, of course, included.  The defendant wisely established a Medical Provider Network under California Labor Code § 4616, and the applicant’s treating physician is within this network.  What’s the problem?  Glad you (mentally) asked…

Applicant, after a few years of treatment, receives a phone call from her primary treating physician’s assistant.  The assistant explains that the PTP is no longer taking workers’ compensation cases.

The applicant calls her lawyer who calls the defendant who gets to work finding a new PTP for applicant.  Why is the defendant heading up the search?  Because Labor Code § 4600 says that “[m]edical … services … shall be provided by the employer.”

After several months of phone calls and searching, it appears that applicant’s (former) PTP was not the only one – none of the physicians in defendant’s otherwise valid MPN are taking workers’ compensation patients.

Before too long, defendant’s adjuster is staring at applicant’s declaration of readiness to proceed and the “present issues” field has the box “other: penalties” clearly checked.

These are the essential facts of Rodriguez v. Pea Soup Andersen’s Best Western (2011), a recent Workers’ Compensation Appeals Board case addressing the issue of who bears the burden of finding a physician for applicant.

The WCAB ultimately found that defendant’s MPN was defective in that there was no physician within applicant’s geographic area willing to treat her.  As such, defendant was obligated to pay for a PTP of applicant’s choice outside of its MPN.

Regarding penalties, the WCAB held that defendant had made reasonable efforts to find a physician for applicant, and that no unreasonable delay had occurred.

Ultimately, this case stands for the point that an MPN is, unfortunately, not a static thing but a creature that changes and grows this the seasons.  In order to retain the protections of the MPN, much like retaining the protection of a camp-fire in the outdoors, the MPN must be fed and tended to with regular maintenance.

If State Compensation Insurance Fund can restrict its doctors’ abilities to prescribe compound drugs, perhaps a contract clause regarding notification should be included as well?

When an MPN doctor stops accepting workers’ compensation patients, that doctor should notify the insurer so that a replacement doctor could be found while other doctors are still accepting workers’ compensation patients.

Even with this limitation, MPNs remain a great tool for protecting the applicant from unnecessary treatment and overmedication while also protecting the insurer’s reserves from being sucked dry.  But, as with all great things in life, their continued benefits require continued vigilance.

On weekday desk-jocks and weekend furniture movers

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In California Workers’ Compensation law, there are a few  un-insurable area.  One of them is Labor Code § 132a – discrimination against an employee for filing a workers’ compensation claim.

Sometimes, however, the workers’ compensation claim provides the context for the employer’s action, but not the reason.

In a recent case, Sandoval v. WCAB (2011), Sixth District Court of Appeals denied applicant’s Petition for Writ of Review.

Applicant claimed to have sustained an injury to his back while working as a delivery driver and was put on modified duty riding a desk.  Someone saw him moving an object beyond his stated restrictions and the employer retained an investigator firm to gather sub-rosa videos.  The videos showed applicant moving heavy furniture on his weekends.

Naturally, the employer fired him.  The 132a claim was the result.  The Workers’ Compensation Judge found for the applicant, reasoning that the proper course of action would have been to bring the videos to the treating physician.

Just a thought: the employer can comprehend the physician-imposed work restrictions enough to assign a job within limited duties, but somehow can’t recognize when the worker is going beyond those restrictions?

The Workers’ Compensation Appeals Board granted defendant’s petition for reconsideration.  The worker was fired because the employer subjectively thought him a liar, and the evidence supports this reason as more than just a pretext.  In fact, the WCAB reasoned that “whether [defendant’s perception of applicant as a liar] was correct is immaterial for our purposes, so long as it was sincere.”

The lesson in this?  The employer is not stuck with a worker who is lying – if something, anything, seems fishy about the employee, don’t hesitate to retain a private investigator service.

Sub-rosa saved UPS (the employer) from having to accommodate someone who, from all appearances, was not the most trust-worthy, nor the least opportunistic, employee.

Some thoughts on California’s climate

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I’ve heard it said that if you can’t stand the heat, get out of the kitchen.  Perhaps California’s kitchen has the heat a little too high for a business-friendly climate?

CNN Money has an article that speaks to this.  The doom-and-gloom headline: “California companies fleeing the Golden State.”  Business friendly states are offering their advantages to court California business,Arizona in particular “is trying to capitalize on [companies finding ways to reduce their costs] by promoting its lower workers compensation and unemployment insurance.”

In a similar vein, the Insurance Journal has an article about the 3% increase in California Workers’ Compensation loss and expense payments.  This shows an increase of 3% to over 11 billion for the industry.  Now, my fingers only go up to 10, so instead of counting I’ll just summarize and say that this is a lot of money.  If you are an employer in California, including a city, or state employer, you bled into the river that gushed 11 billion dollars strong in 2010.

Once, the generally accepted method of blood-letting was thought to cure many ills.  We now know that bleeding patients to death was not the best treatment for their ailments.  Sadly, this lesson is not learned with bleeding California’s employers.

Aside from heavy Workers’ Compensation costs, organizations such as the California Applicants’ Attorneys Association are throwing their weight behind Senate Bill 432, requiring hotels to use fitted sheets and long-handled mops for hotel housekeepers.  Perhaps a law requiring all work to be done by robots would eliminate the risk of any injury?  Of course, the law would not need to be implemented as its passage would scatter California’s employers to the four winds before it could be implemented, and no employees would get hurt because there would be no employees in California.

There are several more articles along these lines: taxing, regulating and scaring away business from California.

California’s employers and businesses put their resources and votes behind Workers’ Compensation Reform and produced the victory that is SB-899.  Because of this, Workers’ Compensation defense attorneys and adjusters have a lot more tools at their disposal for defending against fraudulent and excessive claims.

But something is different in the atmosphere now – it is no longer 2005, and the roster of self-insured employers shows more subsidiaries but fewer new members.

The courts have chipped away at the crown jewel of SB-899: the adoption of the AMA Guides, bringing order and predictability to the rating of impairment, has been gutted by Almaraz even with the limiting aspects of Guzman III.

Now, perhaps, California’s employers are finding it better to vote with their feet than with their dollars, and move to cooler climates: ones with cooler heads and colder shoulders when it comes to crippling taxes and debilitating regulations.

I for one do not want my job shipped to Texas or Arizona or any other place that would require me to move to follow it.  I’m guessing I’m not the only Californian to feel that way.

So I’m committed to doing what I do best – fighting tooth and nail to make sure employers and their insurers don’t have to shed a drop of blood more than what’s ordered by the good doctor(s), and sometimes even persuading the good doctors to order less.  Are you going to help me turn down the heat on California business?

A Day Late and a Supplemental Report Short

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The stars have finally aligned – you got a panel with a known defense doctor, a known applicant’s doctor, and a doctor completely unknown to both sides.  Why does that mean the stars aligned?  Because, just this once, that unknown doctor, the one left standing after the panel process, gave you a slam-dunk report!

Applicant’s counsel, unsurprisingly less than content with an attorney’s fee of 15% of nothing, has written to the Panel Qualified Medical Evaluator to request a supplemental report.  You smile to yourself as you read the applicant’s attorney’s letter, knowing that the QME is not going to budge and you’ve dodged a major bullet.

In California Workers’ Compensation practice, if something seems too good to be true, it probably is.  This goes doubly so for the defense.  Naturally, day sixty passes without the QME having produced a supplemental report, and applicant’s attorney is ready on day sixty-one with a demand for a new panel.

California Code of Regulations, title 8, § 38(a) provides a remedy for initial or follow-up comprehensive medical-legal evaluation reports not submitted within thirty days of the evaluation.  That remedy is a new panel.  But in terms of supplemental reports, governed by subsection (h), what if there is a report submitted after the sixty days allowed?

The section itself does not provide a remedy, nor is there one to be found in the regulations for late supplemental reports.  What’s the answer?  Should the applicant get a new panel?

In the case of Gwen Lloyd v. County of Alameda, the Workers’ Compensation Appeals Board adopted and incorporated the opinion of the Workers’ Compensation Judge, granting applicant’s petition for a new panel.

The facts were similar to those described above.  The WCJ recognized that no remedy specific to supplemental reports could be found in the regulation, and decided the case on policy: the anti-doctor-shopping policy offered by the defendant and the anti-delay-policy offered by the applicant.  The applicant’s policy proved the stronger, and the WCJ cited the need to speed up the process of benefits for the applicant.

In other words, if you have a QME who has given you a bad report, send him or her a supplemental report request and prepare your demand for a new panel.  If the supplemental report is not in your hands at 4:59 p.m. on day sixty, it’s time to file a demand for a new panel at 9:00 a.m. on day sixty-one.

There are a few issues raised by this case that are not addressed by the WCJ’s opinion, nor by the WCAB’s adopt and incorporate order.

Issue One – what if the applicant had received the doctor’s report on day sixty-one, read it, and then demanded a new panel on day sixty-two?  The opinion does not address the issue of whether a late report must also be un-submitted to trigger this new-found remedy of a fresh panel.

Issue Two, which doesn’t seem to concern too many minds in the Workers’ Compensation world, is the purse of the defendants.  At any given point in a case, the defense may have already paid for evaluations, supplemental reports, record reviews and depositions (not to mention the attorney time that goes along with all of these steps in the process).

Will the WCJ issue an order to disgorge these costs from the slow-responding QME?  Or must the defense now expand its reserves to account for the second, third or fourth QME until a doctor can be found whose Hippocratic oath does not commit him to making patients wait?

One way to side-step this new QME-killer is to stay on top of the QME.  If you or the other side has requested a supplemental report from a QME good for the defense, once you hit day 30, you need to send weekly letters asking for that supplemental report.

As for a QME that isn’t too friendly towards the defense, perhaps one should stay quiet until day sixty-one and then quickly file a petition for a new panel?

As an aside, the WCJ writes that she does not know the difference between a “follow-up” report and a “supplemental” report as contemplated by the regulation.

I was always under the impression that follow-up pertained to a report produced after an in-person evaluation, such as when the QME evaluates an applicant, and finds applicant is not yet permanent and stationary.

The supplemental reports are document-based, with no interaction between applicant and the QME, and produced in response to a letter asking additional questions.  Thus, the former is due in thirty days and the latter in sixty.

Does anyone have a different take?  Comment or shoot me an e-mail with your thoughts:  gregory.grinberg@htklaw.com.

These finer issues are sure to be re-litigated in the future.  In the meantime, however, your humble author wishes you a sharp eye on your case-file, a wary sentry on your calendar, and, as always, good hunting.