On Jan. 31, the Texas Department of Insurance’s Division of Workers’ Compensation announced that they are accepting public comment on a staff proposal to amend 28 Texas Administrative Code §130.1. The proposed amendment is intended to clarify the consequence of noncompliance of the rule as it pertains to the certification of maximum medical improvement and evaluation of permanent impairment.
 
The proposed rule amendment is the DWC’s response to an appellate court’s decision in State Office of Risk Management v. Joiner, 363 S.W. 3d 242 (Tex. App. — Texarkana, 2012, pet. filed).
 
Background on SORM v. Joiner
 
The lawsuit arose out of a dispute and subsequent appeal of an Appeals Panel decision centered on competing impairment ratings from the injured employee’s treating doctor and the DWC appointed designated doctor. The designated doctor assigned a 7% impairment rating based on Joiner's condition as of July 10, 2006, while the treating doctor assigned a 34% impairment rating based on Joiner's condition as of July 5, 2006.
 
The dispute was heard by a DWC hearing officer who found that the treating doctor's assigned impairment rating of 7% was not supported by the preponderance of the evidence, but that the treating doctor’s impairment rating of 34% was made in accordance with the American Medical Association Guides to the Evaluation of Permanent Impairment and was supported by a preponderance of the evidence. The hearing officer concluded that Joiner's impairment rating was 34%.
 
The State Office of Risk Management appealed the hearing officer's determination to the DWC’s Appeals Panel. The Appeals Panel reversed the hearing officer's finding that Joiner's impairment rating was 34% and found that it was 7% based on the designated doctor's report.
 
Joiner appealed the decision of the DWC’s Appeals Panel to the district court. The district court rendered judgment in favor of Joiner and ordered SORM to adopt the impairment rating of 34% given by her treating physician and as found by the Texas Workers' Compensation Commission hearing officer. SORM appealed the district court’s decision.
 
On appeal, SORM argued that the treating doctor’s report was invalid because it did not reflect Joiner's condition as of the stipulated date of MMI, it reflected Joiner's condition past the cut-off of statutory MMI, and the treating doctor did not calculate his impairment rating in accordance with the American Medical Association’s Guides to the Evaluation of Permanent Impairment (AMA Guides). SORM also argued that the trial court was obligated to adopt the 7% impairment rating certified by the designated doctor appointed by the DWC and the trial court did not have jurisdiction over the date of maximum medical improvement.
 
The appellate court ruled that “nothing in the plain language of the rule indicates the intent to render an impairment rating of a certain date as "no evidence" of the impairment rating as of another date. That is, the rule does not state the consequence of noncompliance. To interpret the rule to impose a consequence of noncompliance—the complete omission of Davis' report—which is not included in the rule and which would not effectuate the intent of the rule, is erroneous.”
 
The appellate court also ruled that the drafters of the rule – the DWC – failed to include language causing an impairment rating which technically fails to comply with Section 130.1(c)(3) to be invalid. The court said, “If Section 130.1(c)(3) were intended to completely abrogate a report of medical evaluation because it lists an incorrect, retrospective date of maximum medical improvement, the drafters could clearly have indicated this result, just as was done in the case of an impairment rating assigned in violation of subsection 130.1(c)(4).”
 
The appellate court rejected SORM’s complaint that the treating doctor’s certification was invalid because it failed to reflect the correct date of maximum medical improvement. The court also rejected SORM’s complaint that certification was invalid because it listed the date of Joiner's clinical maximum medical improvement seven days after the statutory date of maximum medical improvement.
 
The appellate court also rejected SORM’s complaint that the treating doctor’s certification of impairment was invalid because he failed to comply with AMA Guides. The court stated that SORM’s assertion that the treating doctor improperly assigned impairment for flexion and extension in Joiner's knee was made for the first time at trial and not raised before the DWC’s Appeals Panel. The court noted that the sole argument made to the Appeals Panel in support of overturning the decision of the hearing officer was the fact that the treating doctor’s impairment rating was based upon an incorrect date of maximum medical improvement, and thus could not be adopted.
 
The appellate court noted that district court trial of a workers' compensation case "is limited to issues decided by the appeals panel and on which judicial review is sought. The pleadings must specifically set forth the determinations of the appeals panel by which the party is aggrieved." The court said the decision of the appeals panel was limited to the issue of whether the treating doctor’s certification was invalid because it contained an incorrect date of maximum medical improvement.
 
The court ruled that because the issue of whether the treating doctor’s report was invalid under the AMA Guides was not decided by the appeals panel or the trial court, the appellate court could not decide that issue for the first time on appeal.
 
The appellate court affirmed the decision of the trial court.
 
The Proposed Amended Rule
 
The proposed rule amendments clarifies that an impairment rating is invalid if it is based on a date that is not the maximum medical improvement date. Further, the amendment codifies the DWC’s longstanding interpretation of the rule. The proposed rule amendment also clarifies that an impairment rating and its corresponding MMI date must be included in the Report of Medical Evaluation to be valid.
 
The proposed rule amendments will appear in the Feb. 8 issue of the Texas Register. The public comment period for the rule will end at 5 p.m. today. Comments received after the close of the comment period will not be considered.
 
The DWC has not scheduled a public hearing on the proposed rule amendments.
 
It is anticipated that system stakeholders will prepare and file written comments on the proposed rule amendments. The DWC will consider all written comments submitted in a timely fashion, make non-substantive changes to the rules based on the public comments if deemed warranted, and adopt the rule amendments. The DWC has not announced an anticipated effective date of the rule amendments.

Steve Nichols is workers' compensation manager for the Insurance Council of Texas. This column was reprinted with his permission from a memorandum he sent to the group's members.