June 12, 2007

Supreme Court Changes Burden of Proof for Terminations Under Section 413 of the WC Act

Traditionally regarded as requiring the highest burden of proof under the Pennsylvania Workers’ Compensation Act, termination petitions have always proven difficult to litigate to a successful conclusion. Workers’ compensation judges, citing the remedial and humanitarian nature of the Act, are often hesitant to grant a petition relieving the employer/insurer of all compensation liability for an accepted work injury, resulting in Claimants being left without the safety net of compensation benefits tied to the de minimis burden of surviving terminations with the whining tear-filled testimony that they are not fully recovered and that they continue to need the care of non-board-certified physicians qualified to find tenderness and spasm present in any and every physical examination.

The burden of proof to secure a termination of compensation has always been that the employer/insurer must prove that the injured employee has “fully recovered” from the work injury.

For as long as any of us have been practicing, whether in compensation courtrooms, for employers, or for insurance carriers, the burden of proof to secure a termination of compensation has always been that the employer/insurer must prove that the injured employee has “fully recovered” from the work injury, such that all disability from the work injury has ceased. This burden of proof has been the benchmark for terminating compensation in Pennsylvania.

Virtually every termination petition granted under Section 413 of the Act finds its seed in this rationale, being that the employer need only prove the cessation of all disability related to the work injury to be able to prove that compensation benefits should terminate based on the Claimant being fully recovered from the work injury. Udvari v. WCAB (US Air), 715 A 2d 1290 (Pa. 1997)

The Lewis decision could have an immediate impact on pending termination petitions.

This legal principle and burden of proof has withstood innumerable legal challenges over the years. However, that burden of proof has now changed with the Pennsylvania Supreme Court’s April 18, 2007 decision in Lewis v. WCAB (Giles & Ransome), 919 A. 2d 922 (Supreme Court 2007). Although the changed burden of proof now imposed under Lewis might seem subtle, the Lewis decision could have an immediate impact on pending termination petitions, particularly where it can be argued by the Claimant that the physician whose opinion forms the basis for the termination petition has failed to offer the expert medical opinion now apparently required under the Supreme Court’s Lewis ruling.

The Supreme Court has, in Lewis v. WCAB, significantly altered the playing field on which termination petitions will be litigated, tipping the scales of compensation in favor of Claimants.

Eviscerating an unambiguous but difficult to prove burden of proof that had withstood hundreds, if not thousands, of appellate challenges, almost all of which dealt with questions of fact and credibility, the Supreme Court has, in Lewis v. WCAB, significantly altered the playing field on which termination petitions will be litigated, tipping the scales of compensation in favor of Claimants, and, in turn, making it that much harder for employers and insurers to be able to secure terminations under Section 413 of the Act.

As is often true, a convergence of bad facts always makes for bad law. Lewis involved a truck driver, injured in 1988, who had successfully survived three prior termination petitions in 1990, 1994, and 1999. Three separate workers’ compensation judges denied the employer’s prior termination petitions, with the description of the “accepted” injury being amended several times to include additional injuries.

Three days after losing the third termination petition, the employer filed its fourth and final termination petition. In support of that petition, the physician performing the independent medical examination testified that the Claimant’s work-related injuries were limited to sprains and strains of the cervical and lumbosacral spine, notwithstanding the first workers’ compensation judge having found that the Claimant’s work-related injuries included C8-T1 radiculopathy, an aggravation of pre-existing conditions, including a congenital syrinx and Arnold-Chiari formation, with the second workers’ compensation judge finding in 1997 that the Claimant’s 1988 injury also included L5-S1 radiculopathy, and the third workers’ compensation judge finding in 2002 that the Claimant had also injured his left knee in 1988.

Testifying in support of the fourth termination petition, the IME physician concluded that the Claimant’s pre-existing conditions were unrelated to the work injury, and were aggravated by the work-related injury, and that a physical examination of the Claimant did not reveal any objective evidence of the Claimant having radiculopathy. The IME physician also testified that he concluded that Claimant’s knee injury was being caused by degenerative osteoarthritis, which was not work-related.

The judge granted the termination petition finding that the employer had proven that the Claimant had fully recovered.

The workers’ compensation judge (Harry, we miss you!) granted the employer’s fourth termination petition in 2004. In granting the employer’s termination petition, Judge Harry (now retired) found that the employer’s IME physician’s testimony was more credible than that of the Claimant’s treating physician Dr. Evelyn Witkin. On that basis, the judge granted the termination petition finding that the employer had proven that the Claimant had fully recovered from his 1988 work-related injuries as of the IME physician’s examination in 2002.          

The judge’s decision terminating compensation was affirmed by the Appeal Board. Likewise, the Commonwealth Court also affirmed, finding that substantial competent evidence supported the judge’s granting of the termination petition.

The Supreme Court accepted, and adopted, the Claimant’s argument that the employer cannot seek a termination of compensation based on a full recovery, before first proving that there has been a physical change in the Claimant’s condition.

Granting allocatur, the Pennsylvania Supreme Court reversed the decisions of the Commonwealth Court, Appeal Board, and workers’ compensation judge. In reversing the prior rulings granting the termination, the Supreme Court accepted, and adopted, the Claimant’s argument that the employer cannot seek a termination of compensation based on a full recovery, before first proving that there has been a physical change in the Claimant’s condition, followed by substantial competent medical evidence proving that the Claimant has fully recovered from the work injury.

Appling the Kachinski burden of proof to termination petitions, the Supreme Court held that employers seeking to modify or terminate compensation based on a Claimant’s medical condition improving, with consequent reduction in disability, effectively requires that the employer first prove an actual physical improvement, requiring proof of a “change” in physical condition, which burden can only be satisfied with medical evidence of “any change in the Claimant’s physical well being that affects his ability to work.”

The employer is required to prove, in the event of prior petitions and litigation over the Claimant’s physical condition, an actual change since the last “disability determination.”

Thus, the first prong of an employer’s burden of proof under a termination petition, in reliance upon Lewis, will be “medical proof of a change in the Claimant’s physical condition,” with the employer being required to prove, in the event of prior petitions and litigation over the Claimant’s physical condition, an actual change since the last “disability determination,” meaning a final and non-appealable adjudication before the Bureau and any subsequent appellate challenges. Applying Kachinski to termination petitions, the Supreme Court held, in its majority opinion authored by Justice Cappy, that the employer’s petition, be it for modification or termination, must be predicated on the employer being able to prove, through substantial competent medical evidence, “a change in the Claimant’s physical condition since the last adjudication.”

In Lewis, the IME doctor testified that the work injury was limited to a sprain and strain, with the Claimant having fully recovered from those injuries. The Supreme Court concluded the IME doctor’s opinions were legally insufficient to support a termination, as the opinion did not satisfy the first prong under Kachinski, requiring proof of a “change in condition,” with the added requirements of proving “change” since the last prior “adjudication.”

Parenthetically, Kachinski never required proof of a “change” from the “last adjudication,” it simply required proof of a “change” in the Claimant’s condition, with the critical issue of “change” relating to the Claimant’s ability to return to work, allowing the employer to prove that a Claimant had sufficiently recovered from the work injury if he is physically capable of performing some level of work.

The Supreme Court has significantly altered an employer’s burden of proof for a termination.

Although that has long been the employer’s burden of proof for a modification or suspension under Kachinski (decided in 1987), it has never been the employer’s burden for termination. In so holding, the Supreme Court has significantly altered an employer’s burden of proof for a termination, with the employer now being required to prove; (1) a change in the Claimant’s physical condition since the last adjudication; and, (2) that the Claimant has fully recovered from the work injuries.

The impact of the Supreme Court’s ruling in Lewis will be far-reaching, as there are, no doubt, many termination petitions pending before the Bureau that now might be found to be deficient, as the petitions are likely based on medical evaluations that were focused on determining whether the Claimants being examined exhibited any residual disability related to the work injury, or, alternatively, were found to have “fully recovered” from the work injury, by virtue of there being no objective evidence of continuing injury or disability.

A concurring opinion authored by Justice Baldwin questioned whether the majority’s opinion would preclude an employer from seeking to terminate the compensation of a Claimant whose purely subjective physical complaints were unsubstantiated. Distinguishing between proving a “change in physical condition” versus “a change in disability,” Justice Baldwin cited to the Supreme Court’s 1997 decision in Udvari v. WCAB, 705 A. Section 1290 (Pa. 1997), where the Court had held:  

“The determination of whether a Claimant’s subjective complaints of pain are accepted is a question of fact for the WCJ. In the absence of objective medical testimony, the WCJ is neither required to accept a Claimant’s assertions nor prohibited from doing so…A contrary conclusion would lead to the absurd result that a Claimant could forever preclude the termination of benefits by merely complaining of continuing pain.”

In the Concurring Opinion of Justice Baldwin, an employer’s burden of proof for a termination would be met with substantial competent medical evidence proving that a Claimant had fully recovered from the work injury, allowing a Claimant to return to work without restrictions, with the substantial competent medical evidence proving that there were no objective medical findings substantiating the Claimant’s objective complaints.

No dissenting opinion accompanied Lewis.

Practical Tips

Does Lewis add a new layer of proof for employers seeking to terminate compensation?

The short answer is an unequivocal yes, confirmed by the high-fiving Claimant’s bar which is already awarding the Claimant’s counsel representing the Claimant in Lewis with their distinguished Supersedeas-Defeating Champion of Compensation Rights Award for 2007.

What is left?

Supersedeas hearings are now that much tougher under Lewis.

Although it always depends on who you ask now, and how many cases they have heard that day, Supersedeas hearings are now that much tougher under Lewis, as workers’ compensation judges might be asked by the Claimant’s bar to entertain unreasonable contest attorney fee claims, predicated on IME physicians not having been asked, nor having indicated, that there has been a “change” in a Claimant’s condition since the last “adjudication,” whenever and with whomever that might have been.

To avoid summary dismissal of pending or being-developed termination petitions, we recommend that the IME physician review the original Notice of Compensation Payable, as well as any other Bureau documents, to include judge’s decisions, which describe the body part injured and medical diagnosis of record, so that the IME physician has a clear understanding of what is considered to be the “accepted” and/or “adjudicated” injury.

The lesson under Lewis is that IME physicians are not at liberty to make factual determinations; the IME physician must accept the medical record of work-related injury and diagnoses

If there has already been a claim and injury acceptance or adjudication, the explicit lesson under Lewis is that IME physicians are not at liberty to make factual determinations and/or legal conclusions as to what body parts or medical diagnosis are or are not related to the accepted/adjudicated work injury; Lewis makes clear that the IME physician must accept the medical record of work-related injury and diagnoses, such as it is, with the IME physician then being required to offer three expert medical opinions, including;

All three of the above expert medical opinions are now required under Lewis for any employer/insurer petitioning for a termination of compensation under Section 413 of the Act. Of course, the IME physician must also testify that his/her expert opinions are being offered within a “reasonable degree of medical certainty.”

In light of Lewis, it is now suggested that IME physicians attest to both the “change” as well as the full recovery, as an opinion of “full recovery” not accompanied by an opinion of a “change” is legally insufficient under Lewis for purposes of petitioning for a termination.

• If you are preparing to petition for a termination, it is recommended that you seek an addendum opinion from the IME physician.
• If the termination petition has been filed, and the IME physician has not been deposed, an addendum opinion should still be sought to satisfy Lewis.
• If the IME physician has already testified, and no testimony has been elicited as to a “change,” consideration then needs to be given to whether the IME physician is “re-called” for additional testimony, as well as whether the IME physician can even offer an opinion as to a “change” in the Claimant’s condition.

Depending upon your point of departure, whether preparing the claim for some type of “change” petition, be it termination, modification, or suspension, versus a “change” petition has already been filed and is being litigated, thought will obviously now need to be given by employers and insurers to conform their termination proofs to the requirements of Lewis.

Questions

Questions concerning this decision, or any questions involving workers’ compensation practice and procedures, can be directed to our workers’ compensation attorneys.

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