XCIX The Devil We Know

By: Publius

Amazingly, the Workers’ Compensation Appeals Board issued its much-anticipated decisions on reconsideration of the Almaraz/Guzman and Ogilvie cases the day after “secret” negotiations between self-insured employers and labor representatives exploded on the website, of all places, of the Senate Republicans. Those guardians of transparency felt it necessary to take the tentative work product of the employer-labor discussions – which attempted to address Almaraz/Guzman and Ogilvie, simplify the med-legal process and resolve the increasing mess of lien filings – and post it for all to see. That pretty much finished off a process that could be characterized as “DBA” – or Dead Before Arrival.

Not to worry, though. A bare majority of the Appeals Board miraculously appeared on the horizon and galloped into Sacramento to save the day. Well, sort of. Given the overall reaction by applicant and defense bars, it would seem that the decision in Almaraz/Guzman II at best confounds efforts at the Legislature (which in and of itself is not a bad thing) while limiting the mischief in determining permanent disability to the “four corners” of the AMA Guides. As can be expected from the legal profession, there are more opinions on the significance of these cases than there are lawyers opining on them. Some declare this is a great victory for employers, while others view it as a practical victory for injured workers. For those in the proverbial trenches, it seems to be a blessing of business as usual, since the dreaded “inequitable, disproportionate, and not fair and accurate” standard had yet to find itself in common – or even uncommon – practice, likely due to the expense of developing such proofs. But that four of seven commissioners decided to repudiate that standard should be viewed as a long-term positive.

But not so positive is the continued fixation of the board on the idea that because the AMA Guides do not measure “work impairment,” the use of the guides may be influenced by work restrictions caused by the injury. This concept is inherently contradictory to the board’s decision, both in Almaraz/Guzman I and Almaraz/Guzman II, that the use of the prior rating schedule was inappropriate. Nevertheless, this aspect of the decisions will continue to frustrate expectations that SB 899 and Almaraz/Guzman will provide consistent determinations of permanent disability. Furthermore, there is no solace in the idea that “…in some cases, an injured employee may succeed in increasing the permanent disability rating, but in other cases a defendant may succeed in decreasing it.” The conflict over a PD rating starts in all cases with the impairment rating established by the AMA Guides before consideration of work restrictions.

Once work restrictions are used as a basis for analogizing the actual impairment of the injured worker to impairment (arguably within at least the same zip code of the body part injured) that more accurately reflects the work restrictions, it is up to the judge to determine which rating is substantial evidence and should be adopted. But the employer gets only one bite at the apple – that being the assessment of impairment as specifically provided by the guides. While this is theoretically not the case, as a fundamental issue it is dangerous to advocate that SB 899 contemplates a system where the injured worker is not compensated for his or her actual physical impairment. In other words, the impairment rating established by the guides prior to consideration of work restrictions is a floor under which rests only bedrock.

As if that weren’t enough, unlike history books, legal opinions place a premium on reading the footnotes. Tucked neatly away in footnote 38 is the following bombshell: “Moreover, the language of section 4662 might permit a permanent total disability finding even in cases with relatively little AMA Guides impairment. However, this question is not before us now.” Section 4662 of the Labor Code deals with presumed permanent total disability – a section now making its rounds in CAAA seminars. While the question is not before WCAB now, you can certainly bet it will be soon.

For those who think WCAB “solved” the problem caused by Almaraz/Guzman I, think again. First, the decision reflects only the smallest of majorities, leaving its more controversial and expansive holding potentially in play once new members are appointed by the new governor. (Remember Pendergrass?) Second, and most important, the core holding of Almaraz/Guzman II is significantly less likely to be overturned on appeal, regardless of how many experts on the ins and outs of SB 899 (and that number grows every year) claim that this revised decision is still fundamentally at odds with that legislation. Claims professionals are now charged with the unenviable task of deciding not whether rating by analogy based on work restrictions is appropriate, but rather whether the analogous rating is plausible enough to fold up and cut a bigger PD check.

Thus, doctors and lawyers are back in control of the system. Both sides know the permutations and combinations that can be gamed by manipulation of the guides, but because of the opinion on reconsideration, both sides now also know the rules of engagement and the size of the battlefield. The workers’ comp judges are still the referees making individual decisions based on individual claims.

And then there is Ogilvie.

PUBLISHERS' NOTE: Publius is written by a consortium of writers, sometimes internal, most frequently external. Workers' Comp Executive believes that it has the responsibility to air most viewpoints and welcomes the comments of its community on any subject. Publius does not necessarily represent the views of this publication.