Pursuant to NJSA 34:15-12(d), “[I]f previous loss of function to the body, head, a member or an organ is established by competent evidence, and subsequently an injury or occupational disease arising out of and in the course of an employment occurs to that part of the body, head, member or organ, where there was a previous loss of function, then the employer or the employer’s insurance carrier at the time of the subsequent injury or occupational disease shall not be liable for any such loss, and credit shall be given the employer or the employer’s insurance carrier for the previous loss of function, and the burden of proof in such matters shall rest on the employer.”

Maura Burk

Essentially, this provision provides that if an employee has a prior relevant injury that resulted in prior loss of function to the same body part injured in the work injury, respondent is entitled to a credit (which results in money off the overall award) for the prior injury or preexisting disabling medical condition.

Of particular note, the burden rests on respondent to demonstrate and prove a prior injury and prior loss of function. Proper medical and factual discovery and investigation are extremely important in this regard, as evidence of prior functional loss can save respondent from incorrectly paying for, and assuming liability for, preexisting issues.

Respondent must demonstrate through medical discovery and medical records that the employee has a prior, relevant medical issue and that the prior issue was disabling in order to successfully argue for a credit. It is most helpful when an accurate and detailed history is taken from the employee at the outset of treatment following a work injury.

In some situations, the credit entitlement is easier to demonstrate, and not all prior issues are necessarily applicable to respondent’s credit entitlement.

Following are hypothetical situations where respondent may, or may not, be in a position to argue for a credit on permanency.

Scenario 1

Robert has a work injury on Jan. 1, 2022, to the lumbar spine, and a magnetic resonance image shows herniations at L3-L4 and L4-L5. Robert has a prior workers’ compensation award for 15% partial total from a work accident on Jan. 5, 2019, in the lumbar spine for a bulge at L4-L5.

Here, respondent is entitled to a credit for the prior bulge at L4-L5. The credit is likely to be 15% partial total for this aspect/ level of the case, as the prior workers’ compensation award was for 15% partial total for the lumbar spine bulge at L4-L5.

This can result in significant savings to respondent. For example, an award of 30% partial total at 2022 rates is $62,568. An award of 30% partial total, credit 15% partial total, is $37,026.

Scenario 2

Charlie has a work injury on Jan. 1, 2022, to the lumbar spine. An MRI shows herniations at L3-L4 and L4-L5. Robert has a prior non-work-related injury to the lumbar spine, and a prior MRI revealed a bulge at L4-L5.

This is similar to Scenario 1, other than the fact that Charlie’s prior injury was not work-related, and there is no prior workers’ compensation award for this prior injury. However, respondent is still entitled to a credit, which is somewhat more negotiable than the credit applied in Scenario 1, for Charlie’s prior issues in the lumbar spine and at L4-L5.

Scenario 3

Peter has a work injury on Feb. 14, 2022, where he injures his right shoulder, neck and right arm. Prior to the work injury, on Dec. 24, 2021, petitioner underwent a right shoulder surgery. Other than the prior surgery, petitioner has had no prior medical issues or injuries.

Here, respondent is entitled to a credit as to the right shoulder aspect of the claim. Regarding the neck and right arm, if Peter truly has no relevant prior history, respondent is not entitled to a credit for these aspects of the claim.

Employers should keep in mind that potential credit entitlement can depend on a number of factors, including length of time since any prior injuries or issues, strength of any medical evidence documenting prior issues, and prior functional loss. There does not need to be a prior workers’ compensation award or any prior settlement for respondent to successfully argue for a credit entitlement.

However, it remains important to be sure that prior discovery, medical records, information and investigation obtained by respondent are provided to its medical experts and examiners so that the defense experts can properly assess prior issues and accurately apportion treatment/ permanency to the accident and to preexisting issues, if applicable.

It is also important for respondent’s experts to take a detailed history of the employee during the examination in order to determine any preexisting issues and properly assess causation. Without a medical expert opining as to the existence of preexisting issues and their current disabling effect, it can be much more difficult to argue for a credit.

Providing the discovery to respondent’s experts is just as important as respondent obtaining the discovery. In order to successfully argue for a credit for a prior issue, in most cases, respondent needs to proffer a medical opinion discussing the preexisting disabling injury or medical issue.

Maura Burk is a shareholder with Capehart Scatchard, a defense law firm in New Jersey. This post appears with permission from the New Jersey Workers' Comp Blog.