If an Illinois claimant seeks penalties and fees on medical bills, the documents have to be tendered.

Timothy O'Gordon

Brittany Theis v. IWCC, No. 1-16-1237WC, March 17, 2017, was originally tried before an arbitrator in April 2014. Shortly thereafter, an award was issued for permanent, temporary total disability and medical bills. Neither party appealed, and the award became final.

Thereafter, the petitioner’s counsel filed a petition for 19K and 19L penalties, and Section 16 fees, before the commission for non-payment of the award. These penalties/fees could have dramatically increased the award by approximately 70% of the amount owed.

The petitioner’s allegation claimed medical bills that were awarded at trial had not been paid for several months following the decision becoming final. The petitioner, until October 2014 — about six months after the award became final — repeatedly refused to “tender” medical bills to the opposing counsel as required by the Illinois Workers' Compensation Act and simply submitted them for the record at the earlier hearing.

The petitioner counsel’s unusual argument was that it was incumbent upon the respondent counsel to order a copy of the arbitration transcript, or subpoena the petitioner’s providers to obtain full copies of all medical bills, including the needed documentation.

It was admitted during oral arguments that the petitioner’s attorney had not provided copies of the petitioner’s exhibits to the respondent prior to, during or subsequent to the trial commencing. No reason for failure to tender copies of the bills was outlined in the record.

The respondent presented arguments and evidence submitted for the record specifically addressing this argument. The respondent argued that it was the petitioner herself who created a delay in payment by failing to “tender” medical bills to the respondent or its counsel.

This conclusion is one that utilizes common sense: How can a respondent subpoena medical bills when it may not even know which medical providers the petitioner may have been seen by? Furthermore, the state WC Act and prevailing case law is extremely clear as to the burden of proof resting upon a claimant. Requiring respondents/insurance carriers to seek out medical bills unilaterally would impermissibly shift the burden of proof.

The commission panel agreed and specifically found the petitioner herself was the cause of the delay in tender and payment of the medical bills. It confirmed that the Illinois WC Act specifically requires a petitioner to “tender” medical bills prior to the accrual of any liability for Section 19K and Section 16 penalties/fees. By refusing to send these medical bills to the respondent, the respondent’s insurance carrier or counsel, the petitioner could not “hide the ball” and collect 19K penalties or Section 16 fees as a result of her inactivity.

Despite coming to this very specific conclusion, the commission confusingly awarded 19L “late fee” penalties from the date of the award through the date the bills were eventually paid, per the the state WC medical fee schedule. This period of time included several months where the respondent did not even know bills were still outstanding, as it had not been presented with copies of any allegedly unpaid bills.

The respondent appealed to the circuit court and argued that the commission’s decision was inherently contradictory. The commission appeared to have come to a very specific conclusion that a petitioner should not be able to hide medical records from a respondent and expect to collect penalties. Then the commission panel contradictorily awarded 19L penalties.

The circuit court agreed with the respondent’s common-sense arguments and vacated the award for penalties, finding the commission’s decision was against the manifest weight of the evidence and that, based upon the commission’s own findings and conclusions, 19L penalties would be inappropriate.

The Illinois Appellate Court, WC Division, agreed in its ruling in Theis v. IWCC. A petitioner cross-appealed the decision of the circuit court and again attempted to argue that respondents should be expected to prove a negative. According to the petitioner, a respondent should be held responsible for obtaining medical bills, possibly without knowledge of all medical bills existing, and relying solely on a providers’ custodian of records that bills may be complete and provide needed documentation to allow processing.

This argument begs a number of questions. If a respondent is expected to subpoena medical bills, when would the clock begin to run on penalties? At the time the subpoena is issued? What if a provider is non-compliant? Should the deadline start at trial? At the time a transcript is order or received? The purpose of this ruling may be to simplify future proceedings and provide concrete answers.

This court came to the abundantly correct conclusion in answering these questions as “none of the above.” The penalty clock should begin to run only after medical bills are “tendered” to a respondent, as the commission had stated originally.

The Illinois Workers' Compensation Appellate Court affirmed the finding of the circuit court and vacated all penalties awarded, as the respondent had an adequate justification for the delay of bill payment — namely, that the petitioner created the delay.

This article was researched and written by attorney Timothy O’Gorman of Keefe, Campbell, Biery and Associates, a Chicago-based workers' compensation defense firm. This column was reprinted with his permission from the firm's client newsletter.