Whether settlement is via stipulated award or compromise and release, one of the most common impediments for defendants is valuing exposure for lifetime medical care.
Applicants will frequently make overvalued settlement demands by valuing medical care for a body part over applicant’s lifetime. If surgery is a possibility, the defendant can expect a grossly overvalued demand. Many are under the impression that industrial body parts always warrant lifetime medical care.
However, there is a method for limiting medical care that can be used as leverage in negotiating settlements. This article addresses some myths about medical care awards.
The first myth is that when an applicant has a pre-existing condition, all industrial treatment must cover that condition if it is necessary for treating the industrial condition. This is simply not necessary in many cases.
Weight loss is a common example of this. An applicant who needs to lose weight to treat an industrially injured back may claim that weight loss treatment is required on an industrial basis. Another example is diabetes, where an applicant claims that his diabetes must be treated in order to treat the industrial condition.
This position is based on Granado v. WCAB, which held that medical care cannot be apportioned. Therefore, if the industrial injury causes 1% of the need for medical care, all medical care for that body part/condition is industrial.
However, the Workers' Compensation Appeals Board has held that pre-existing conditions are not always subsumed by industrial conditions. In Reff v. WCAB, the applicant claimed that she contracted occupational pneumonia, which affected her pre-existing and dormant common variable immune deficiency. She claimed that this caused a need for lifetime medical treatment of immunoglobulin deficiency replacement injections.
The trial judge agreed and awarded lifetime injections.
Defendant appealed, and applicant argued that any aggravation of a pre-existing condition by an industrial injury placed liability for treating the pre-existing condition on defendant.
The WCAB reversed and concluded that the industrial injury triggered only a temporary need for industrial treatment of the pre-existing condition. Therefore, a lifetime award of treatment for the pre-existing condition was inappropriate. The WCAB concluded that the correct standard is whether “the normal progression of the nonindustrial disease or condition would have resulted in disability regardless of the industrial injury.”
In other words, if the pre-existing condition would have caused disability, with or without the industrial injury, it should not be deemed a compensable injury requiring an award of lifetime medical care.
The WCAB further noted that if “the medical treatment or medication in question is required separate and apart, or independent of, an industrial injury or condition, then the employer may avoid liability.”
The medical evidence in Reff showed that applicant’s immune deficiency caused a need for only two months of industrial treatment, after which the condition returned to its pre-industrial injury baseline. Therefore, a lifetime award of medical care for the immune condition was inappropriate.
Defendants should carefully examine the medical evidence and determine whether an applicant suffered a temporary aggravation of a pre-existing condition, or whether it was a permanent aggravation (which may justify a lifetime award of medical care). If a pre-existing condition can be treated temporarily and brought to a pre-industrial injury baseline, then lifetime treatment on an industrial basis is not required.
In Boehm & Assoc. v. Workers’ Comp. Appeals Board, applicant sustained an industrial injury to his lumbar spine (sprain) and treated with a chiropractor. X-rays confirmed there was no disk herniation. Applicant was awarded future medical care for his lumbar spine. He then retired but sustained a “flareup” while chopping wood and underwent spinal surgery.
Kaiser sought to recover on its lien for the surgery, arguing that it was the result of the industrial injury and covered under the future medical care award. The judge denied this claim, and Kaiser appealed.
On appeal, the WCAB held that the lumbar strain was not a substantial cause of the herniated disk and need for surgery. The WCAB explained that the rule set forth in Granado precludes apportionment of medical care when it is impossible to separate a non-industrial and industrial need for treatment.
In Boehm, however, it was possible to separate the industrial and non-industrial need for treatment, and the reasonable medical basis for doing so was described by the defense QME.
The second myth is that an award of medical care must cover any and all subsequent medical care for that body part, subject only to utilization review and independent medical review.
In reality, the WCAB may award medical care limited to a specific modality, such as chiropractic treatment or medication. In Kaufman v. WCAB, the judge awarded lifetime medical treatment but specified the type of treatment (medical equipment, etc.). The Court of Appeal held that the WCAB had the power to specify the treatment the employer must furnish.
Similarly, the board may make a provisional or precautionary award that the injured worker may need further treatment for a limited basis.
Finally, many defendants are unaware that they may petition to terminate medical care. Therefore, when medical evidence shows that the condition no longer requires medical care, a petition to terminate may be appropriate. However, Labor Code § 4607 provides that an applicant who successfully defends against a petition to terminate a medical award is entitled to attorney’s fees.
Summary and conclusions
As shown above, the myth of unlimited and unrestricted lifetime medical awards has pervaded the workers' compensation system. Defendants have provided lifetime medical care based upon the assumption that applicants will require unlimited lifetime medical care, subject only to UR.
Instead, the WCAB can limit future medical care. Once an aggravated nonindustrial condition has returned to its pre-industrial injury status, medical care should be procured on a nonindustrial basis. Moreover, stipulated awards, subject to the WCAB's approval, can limit future medical care in appropriate circumstances. Finally, future medical care can be limited to specific modalities and treatments, if supported by medical evidence.
A back sprain may result in the need for limited chiropractic treatment, but a fusion 10 years after a sprain should be treated on a nonindustrial basis. When a defendant evaluates a panel-qualified medical exam report addressing future medical care, adjusters should consider whether the QME can prescribe limited future medical care.
Leaving a vague award of lifetime medical care for a particular condition, without clarification as to the extent and duration of treatment, invites unwarranted expenses.
Michael Burns is a partner at Bradford & Barthel’s San Jose location. This entry from Bradford & Barthel's blog appears with permission.
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