This month serves as a vivid reminder of how important the courts are in California’s workers’ comp system. While much bandwith is used talking about what the Legislature may do or what the Division of Workers’ Compensation won’t do, usually we don’t discuss the role of the judiciary until after something—usually something important—has happened.
In this case, perhaps because of a lull brought on by legislative deadlines and gearing up for hearings on proposed changes in the permanent disability rating schedule, two tribunals—the Court of Appeals and the Workers’ Compensation Appeals Board—had a rare moment on center stage. In both cases, the opinions are more memorable for what might have been than what actually took place. And in both cases, that is a good thing.
In Facundo-Guerrero v. WCAB , the Court of Appeal correctly rejected a constitutional challenge to restrictions on chiropractic treatments first codified in Senate Bill 228 (Alarcon). Acknowledging the wealth of information available to policymakers on high-frequency use of physical medicine services, the court found a clearly “rational basis” (as that phrase is used in constitutional challenges) for the caps. In this case, because both state and federal constitutional issues were raised, the Appeals Board had no jurisdiction to address the core complaint, thus the litigants were given an E-ticket ride to the appellate courts.
As is the case with most challenges to the recent reforms, the Court can deal only with the issues before it, and as we will see in a more significant case—of sorts— Boughner v. Comp USA , that limits what the courts will do. The broad constitutional challenges to a host of reform issues raised since SB 899 (Poochigian) was signed into law have uniformly failed. Whether that will send a signal to litigants is another issue altogether.
This brings us to Boughner. This most recent challenge to the validity of the permanent disability rating schedule began with a workers’ comp judge who decided to allow into evidence much of the same testimony that the Appeals Board already determined to be irrelevant in Costa v. Hardy Diagnostics. Shazam! When that happened the judge arrived at a different conclusion and invalidated the rating schedule.
What should have come as a surprise to no one is that when confronted with this record, the Appeals Board reminded the community that it had been-there-done-that with Costa and politely but firmly showed the applicant the door. Boughner is a very well-written opinion that goes a very long way toward educating our little community on what exactly it means to challenge a regulation in the workers’ comp system. In other words, it would be really, really silly to take this case up to the Court of Appeal.
Does Boughner close the door on the challenges that then-Administrative Director Andrea Hoch pulled the future earnings capacity values out of thin air? Well, it should, but the Board still leaves the door open, if only for the most narrow of cracks, to such claims. But as we move to a new permanent disability rating schedule, this argument should wane considerably. The more pressing question for the Appeals Board, and perhaps the appellate courts, is how applicant attorneys will successfully rebut the schedule—a process clearly envisioned in statute and less clearly acknowledged in Costa.
The ongoing effort to establish a precedent for bypassing the schedule is the one outstanding issue where the Appeals Board has yet to opine. As we move to a new schedule, and ultimately a new administration in 2011, we must keep a watchful eye on the Board. Once a template for rebutting the schedule is established, it will add both costs and uncertainty to claims that are already getting more expensive.
Even if this is only a three-piece puzzle (AD adjusts schedule, Legislature adjusts benefit levels, and courts set rules), it is difficult to piece together. Cost estimates for the new revised schedule may or may not be accurate, but there is certainly high anxiety over how back injuries will escalate once the new schedule is adopted. Conventional wisdom suggests that SB 1717 (Perata) will either go the way of its predecessors or won’t even be taken up at all now that the AD has started the schedule revision process.
On the other hand, the courts are waiting. They are still a shapeless piece to the puzzle, which makes it impossible to understand what PD post-SB 899 will look like. Remember how SB 899 was supposed to add certainty to PD determinations? Well, we’re still waiting.