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Desirae Cintron was injured in a motor vehicle accident on September 20, 2011 while walking in the parking lot of a Walmart store where she worked.  She was struck by a vehicle driven by Marvin Thomas.  Cintron was eligible for PIP benefits because she lived with her father who had an insurance policy with NJM.  She brought a law suit against Thomas in civil court for damages.

The issue of Walmart’s workers’ compensation lien arose as part of the civil suit with defendant Thomas taking the position that Walmart had no lien rights because evidence of PIP benefits, which are collectible or paid under a standard PIP policy, are inadmissible in a civil action for recovery of damages. Because the plaintiff would not be able to recover her medical bills, the Defendant contended that Walmart would not be able to recover its lien for the payment of these bills. Defendant argued that the automobile reform legislation included a provision insulating a tortfeasor or person responsible for the accident from a claim for medical expenses and wage benefits that are paid by PIP.  The way this was accomplished was through a provision in the PIP law under N.J.S.A. 39:6A-12, which bars evidence of PIP benefits which are collectible or paid under an auto insurance policy. What this does, in effect, is prevent a double recovery of PIP benefits already paid out or due to the insured in a subsequent action.

Walmart intervened in this case to protect its lien. It contended that N.J.S.A. 39:6-12 did not apply to a suit involving an automobile accident in which the workers compensation carrier paid the medical bills. Because the cost of work-related auto car accidents is ultimately borne by the workers’ comp carrier, these benefits are not “collectible or paid” through PIP coverage and are admissible. Thus, it should be entitled to assert its lien to collect on the medical bills it paid.

Defendant relied heavily on the unreported case of Dever v. New Jersey Mfrs. Ins. Co, 2013 Wl 5730033 (App. Div. Oct. 23, 2013) for the proposition that there is no workers’ compensation lien in this situation.  Walmart, which was represented by Capehart Scatchard through Gina Zippilli Esq. and Betsy Ramos, Esq., argued to the contrary  that Dever is entitled to no precedential value and that the controlling case in this area is Lefkin v. Venturini, 229 N.J. Super. 1 (App. Div. 1988).

The Honorable Darrell Fineman, J.S.C., Law Division, Cumberland County, held in favor of Walmart.  “Plaintiff’s workers’ compensation lien is admissible because precedential case law controls, and there has been no indication that the statute has been changed as to workers’ compensation through the enactment of AICRA.”   The Judge said that the Lefkin case is binding on the court.  The Judge reasoned that workers’ compensation is ultimately responsible for payment of medical bills in a situation where the PIP carrier makes the initial payment.  The PIP carrier has a right of reimbursement against the workers’ compensation carrier.  Therefore, evidence of the medical bills should not be barred in the civil suit because they are not collectible under the PIP policy.  The Judge concluded:

In the case where both workers’ compensation and PIP apply, the workers’ compensation system is the ultimate payer of the plaintiff’s medical bills.  Therefore, it makes little sense to apply a bar created for the PIP statutory scheme and not a part of workers’ compensation statutory scheme.

This decision, which was rendered on February 23, 2015, is now the second decision in the Superior Court in the past few months rejecting the Dever case as having no precedential value and essentially being wrongly decided.  It is an important decision because there are so many employers in New Jersey who are trying to recover workers’ compensation liens where plaintiffs are defending by means of the Dever case.   For further information on this case, please contact Betsy Ramos, Esq. at bramos@capehart.com.

A number of clients have inquired recently whether claimants in workers’ compensation cases have a right to request their treating medical records from the insurance carrier, third party administrator, or the authorized treating physician.  The answer to this question comes from both the New Jersey Workers’ Compensation Act and from the rules of the New Jersey Medical Society.

N.J.S.A. 34:15-128.4 provides that it is unlawful for an employer, the carrier or the treating physician, or a third party in the case or their agents “to withhold from the individual any medical information they have regarding that individual which is requested by the individual, and if an individual requests the medical information, the individual shall not be charged fees in excess of the cost of providing copies of the information.”  In other words, a claimant has a right to medical information from any party to a workers’ compensation case.  That includes the treating medical provider.

Authorized workers’ compensation physicians owe the same obligation to a treating claimant as they would to a private patient.  The mere fact that the employer has designated the treating doctor and pays for the care in no way changes the doctor-patient relationship in a workers’ compensation case.

The rules of the New Jersey Medical Society are similar.  Under N.J.A.C. 13:35-6.5, the treating medical provider must provide patient records no later than 30 days from the receipt of a request from the patient or an authorized representative.  The records must include objective data such as test results and x-ray results.  The rules go on to say that when a patient has requested the release of medical records to a specified individual or entity, the physician shall secure a written medical authorization to protect the privacy interests of the patient.

The Board of Medical Examiners also provides that the cost of reproducing such records shall not be greater than $1.00 per page or $100 for the entire records, whichever is less.  If the records are less than 10 pages, the medical provider may charge $10 to cover postage and associated costs related to the retrieval of such records.  Medical providers shall not charge for a copy of the patient’s records when the physician has effectively terminated a patient from practice in accordance with the requirements of N.J.A.C. 13:35-6.22.

It is important to understand the difference between a treating physician and a independent medical examiner.  Because there is no physician-patient relationship in a situation involving an independent medical examination, a physician who is performing an IME does not have to provide a copy of such a report to the examinee.  That report is sent to the party which requested it, usually the carrier, third party administrator or counsel.

The rule regarding disclosure of treating medical records between counsel is contained in N.J.A.C. 12:235-3.8 (c), which states that either party must furnish medical information to the other within 30 days of the receipt of a demand for such records.  Usually the employer or its carrier/third party administrator has the treating records, and in that case those records must be made available to petitioner’s counsel or petitioner on request.  If the petitioner has obtained treatment on his or her own, then the same obligation rests on petitioner to provide such records to the employer on request.  If a party is not responding timely to a request for medical information in a litigated case, the appropriate step is to file a motion in the Division of Workers’ Compensation.

There have been a number of developments in the Division of Workers’ Compensation in 2015 of which practitioners should be aware:

Retirement of Director Peter J. Calderone,

After 13 years of service as Director of the Division of Workers’ Compensation and 39 years of service to the State of New Jersey, Chief Judge and Director Peter J. Calderone announced this week that he will be retiring effective February 28, 2015.  Director Calderone raised the level of professionalism within the Division and modernized the New Jersey workers’ compensation practice, with e-filing of pleadings, court listings and communications from counsel to the courts.  He led the creation of an extensive case management system and developed a first class Division website providing a wide range of valuable information to practitioners and the public.   During his tenure, rules for discovery on urgent motions for medical and temporary disability benefits were established, and new administrative rules were adopted for medical reimbursement petitions, thousands of which are now handled in the Division.

The new Director of the Division of Workers’ Compensation will be the Honorable Russell Wojtenko, Jr., Supervising Judge of New Brunswick vicinage.  Judge Wojtenko resides in Mercer County and currently sits in New Brunswick.  He has earned a reputation in the bar as  hard working and fair to all parties.

Three New Workers’ Compensation Judges

The Governor has nominated three experienced practitioners as workers’ compensation judges: Michael J. Dillon, Esq., Thomas J. Ludlum, Esq. and John C. Gavejian, Esq., all from Bergen County.

2015 Rate Charts Are Available

For clients who are interested in receiving 2015 rate charts, please email the undersigned or Carol Wright at cwright@capehart.com.  The maximum rate for temporary disability benefits and total permanent disability benefits is $855 per week, up from $843 per week in 2014.  That amounts to approximately a 1.5% increase over last year.

The minimum rate is now $228 per week.  The current state average weekly wage on which the rates are based is $1,140.02 per week. In 2005 the maximum rate was $666 per week and the minimum rate was $168.  In 1995 the maximum rate was $469 and the minimum rate $125.  In the past 20 years the maximum and minimum rates have increased 82%.

Robin Williams was injured working for Ready Pack on May 18, 2006 and May 22, 2006.  A settlement was approved for 10% of partial total for the left shoulder on August 11, 2008.   Thereafter, Williams moved to Philadelphia and left the employment of Ready Pack.

On August 10, 2010, petitioner filed a reopener application alleging that her condition had worsened and seeking additional treatment.  She failed to appear for an appointment with respondent’s expert on August 25, 2011.  On September 2, 2011, she was murdered.  Ready Pack was not aware of the petitioner’s demise and scheduled two more appointments.

On December 5, 2011, the Judge of Compensation was advised of the death of petitioner.  The hearing on that date was adjourned till March 19, 2012.  Because nothing was happening with respect to the case, respondent filed a motion to dismiss, which was granted on September 24, 2012.

In September 2013 counsel for Williams filed a motion to restore the case.  That motion was heard on October 28, 2013.  The Judge of Compensation denied the motion to restore with prejudice on the ground that petitioner failed to show good cause to reopen the case.

The issue in this case centered on the meaning of “good cause shown” under N.J.S.A. 34:15-54. The Judge of Compensation noted that all petitioner’s attorney had done in nearly 11 months was write two letters in an attempt to find petitioner’s representatives.  The Judge noted that Williams left no surviving dependents, so the purpose of the workers’ compensation statute had been fulfilled.

The petitioner appealed and argued that good cause had been shown.  The Appellate Division said the following:

The phrase ‘good cause’ has been interpreted as ‘a substantial reason that affords legal excuse for the default.’ . . . N.J.S.A. 34:15-54 ‘is intended to bring a compensation case to an end regardless of the merits in the event the claimant does not diligently prosecute his petition. ‘Good cause,’ therefore, is concerned not with the merits alone but as well with the excuse for the delay.

The Court added that the judge’s “concern regarding counsel’s failure to promptly address William’s lack of response and to attempt to keep the court informed is warranted.”  Nonetheless, the Court reversed the Judge of Compensation stating, “It is tempting to affirm the JWC’s order because, other than her death, counsel does not identify another factor in her favor.  Death is, however, a quite substantial factor.  The JWC’s discretionary ruling obviously prejudiced the substantial rights of Williams’s estate and her beneficiaries.”   The Court said that it would be inequitable to bar the door to Williams’ heirs if she was entitled to a recovery.

What this case shows is that the language of Section 54 requiring a case that has been dismissed to be reinstated within one year for “good cause shown”  is a very low bar indeed.  If a motion to reinstate is filed within one year from the dismissal date, the case will almost certainly be reinstated, no matter how weak the reasons for reinstatement.  The case can be found at Williams v. Ready Pack, A-1689-13T2 (App. Div. January 23, 2015).

There has been a great deal of controversy about respondent’s lien rights in motor vehicle accident cases since the unreported ruling in Dever v. New Jersey Mfrs. Ins. Co., No. A-3102-11T2 (App. Div. October 23, 2013). In one decision from last summer, an Atlantic City Superior Court Judge rejected the application of the Deverrule in a similar set of facts.

The Atlantic City case, Colmyer v. Vicki S. Abline, Docket No. ATL-L-5766-1 (August 12, 2014), involved a car accident between plaintiff, Timothy Colmyer, and defendant, Vicki S. Abline. The Little Egg Harbor Municipal Utilities Authority, plaintiff’s employer, paid workers’ compensation benefits and asserted a lien in the amount of $31,768. The MUA intervened in the case to protect its lien rights underN.J.S.A. 34:15-40. The defendant argued that N.J.S.A. 39:6A-12 bars the introduction of evidence of amounts “collectible or paid” by Personal Injury Protection. Defendant further argued that it made no difference whether the medical expenses were paid through workers’ compensation or PIP or any other source: the statutory bar precludes evidence of such payments.

The MUA countered that there was a double recovery in this case to the extent of its medical payments and that it was entitled to reimbursement under the statutory formula. Superior Court Judge, Honorable Allen Littlefield, J.S.C., first examined the two statutes. The Judge also noted that both plaintiff and defendant relied upon the unpublished decision in Dever, supra. Judge Littlefield wrote, “In Dever, the Appellate Division held that a plaintiff is statutorily precluded from recovering medical expenses from a tortfeasor where such expenses were paid by the plaintiff’s workers’ compensation carrier.”

Judge Littlefied next observed that Section 12 of Title 39 was adopted after Section 40 of the New Jersey Workers’ Compensation Act. He said that the legislature was fully aware of the provisions of Section 40 when it adopted Section 12. The logic is that the legislature could have abrogated respondent’s lien rights under Section 40 in adopting Section 12, but it did not.

Judge Littlefield further observed that “the Appellate Division decision in Lefkin v. Venturini, 229 N.J. Super. 1 (App. Div. 1988) is still good law and should be followed by the Court.” The rule in Lefkin is “that a plaintiff must pay the medical expense portion of a workers’ compensation lien out of his recovery from the tortfeasor defendant.” The Court in Lefkin said:

Where only workers’ compensation benefits and PIP benefits are available, the primary burden is placed on workers’ compensation as a matter of legislative policy by way of the collateral source rule of N.J.S.A. 39:6A-6. (citations omitted). And when only PIP benefits and tortfeasor liability are involved, the primary burden is placed as a matter of policy on the PIP carrier by N.J.S.A. 39:6A-12.

The court in Lefkin concluded that there is no bar against recovery of the medical expenses collected or collectible in workers’ compensation from the tortfeasor. The Court reasoned as follows:

This is so because PIP benefits are not available to an insured if workers’ compensation benefits are also available to him. Consequently, PIP benefits in that situation are neither collectible nor paid. Hence, N.J.S.A. 39:6A-12, which bars evidence in the third-party action only of ‘amounts collectible or paid’ under PIP coverage, is inapplicable, and there is no other impediment to the plaintiff-insured-employee recovering his medical expenses from the tortfeasor even though that recovery will ultimately be subject to the compensation lien.

Judge Littlefield concluded, “Because MUA is entitled to recover from Plaintiff’s recovery, it logically follows that evidence of Plaintiff’s medical expenses must be admissible at trial. If the medical bills were precluded, the compensation carrier would be unable to secure reimbursement from the Plaintiff pursuant to N.J.S.A. 34:15-40.”

There are now countless cases in New Jersey where plaintiffs who have both workers’ compensation recoveries and settlements in car accidents are refusing to reimburse medical expenses based on the theory advanced in Dever. This decision is not the final word on this subject but it shows that at least one Superior Court has flatly rejected the recent ruling in Dever.

It is very difficult to appeal a Judge of Compensation on the level of permanency awarded following trial.  That lesson can be seen in Huesser v. United Airlines, A-5959-12T3, (App. Div. July 14, 2014).

Elaine Huesser worked as a flight attendant for United Airlines since 1998.  She suffered her first injury on September 28, 2005 when her flight seat broke, causing her to fall and injure her left shoulder and lower back.  That case settled in March 2009 for 42.5% of partial permanent disability, apportioned 27.5% for the left shoulder and 15% for the low back.

The second injury occurred on September 28, 2008, when petitioner suffered a massive rotator cuff tear of the right shoulder while lifting a suitcase into an overhead compartment.  She had four surgeries following this incident, culminating in a shoulder replacement procedure.

Huesser reopened the first award and sought an increase in permanency.  She had invasive pain management treatment , including lumbar injections and lumbar nerve ablations after the initial award was entered.  Both the reopener claim and the right shoulder claim were tried to conclusion before the Judge of Compensation, with the only issue being the nature and extent of permanency.

The job of flight attendant was demonstrated to be very physical, with occasional lifting of up to 75 pounds, pushing metal carts weighing 250 pounds, lifting bins of sodas, reaching to close overhead bins, lifting luggage, and opening and closing heavy flight doors.  Huesser testified that she returned to work in November 2010 after two years of treatment following her four right shoulder surgeries.  She had seniority with United Airlines, which permitted her to avoid some of the heavy lifting duties.  She became a purser, a job which involved lifting lighter bags and doing more supervisory work.  Eighty five percent of the time she did not have to do the very heavy lifting, but the remaining 15% of the time she still did some of the physical tasks, which she would perform in pain.  She said she learned to compensate for the pain in her right shoulder and adjusted the way she did things.

At the time of her testimony, petitioner said she had constant pain in her mid to lower back which had worsened since her testimony at the time of her first award for the 2005 accident.  The pain had begun to travel down to the left and right sides of her buttocks.  Her sleep was deleteriously affected.  Her husband testified that she no longer cooked, cleaned or gardened.

Respondent produced two employees who said that petitioner was never written up for being unable to perform her job, and she never complained about inability to do her job duties.

Petitioner’s expert, Dr. Gaffney, testified that her level of disability increased since the original award.  He raised his estimate of disability for her back by 45%.  Dr. Tobias, petitioner’s expert for the right shoulder, said she had a disability of 75%.

Respondent’s expert, Dr. Zazzo, increased his disability on the back by 2.5% and left shoulder.  He estimated 33% disability for the right shoulder, and he increased that percentage at trial to 38.5%.

The Judge of Compensation found an increase of 10% in the low back, meaning that her award for the 2005 accident was 52.5% credit 42.5% ($52,035), and he awarded petitioner 45% on her right shoulder ($120,150), which was only marginally higher than the very high estimate of respondent’s expert, Dr. Zazzo.   Respondent appealed both judgments, contending that they were not based on adequate and credible evidence.  The Judge of Compensation found no increase on the left shoulder.

The appellate division dispensed with the argument that the Judge of Compensation had not considered the fact that petitioner had not complained about her job duties since returning to work in November 2010.  The court noted that her seniority allowed her to avoid some of the heavier tasks and noted that she simply worked in pain.  The court also rejected the notion that the mere fact that petitioner successfully returned to work negated such high awards.  It cited N.J.S.A. 34:15-36: “nothing in this definition shall be construed to preclude benefits to a worker who returns to work following a compensable accident even if there be no reduction in earnings.”

In the end, the appellate division deferred to the expertise of the Judge of Compensation in finding the correct level of disability.  “We recounted in detail the compensation judge’s findings and conclusions because they demonstrate a comprehensive and thoughtful review of all of the testimony and evidence presented.  The judge made credibility determinations and clearly set forth the basis for his findings and conclusions.  We find the judge’s determinations of disability are supported by the weight of the evidence.”

We live in a world where terrorism unfortunately poses genuine insurance risks. The Terrorism Risk Insurance Act (TRIA) was passed by President George W. Bush on November 26, 2002 to establish a backstop for insurance claims arising from acts of terrorism.  This coverage includes workers’ compensation claims.  Before September 11, 2001, insurance companies generally did not charge for nor specifically exclude terrorism coverage.  However, much of the cost from the 9/11 attacks fell on reinsurance companies, leading some to withdraw coverage for terrorism from the market place.

TRIA was passed to provide protection for employers and insurers in the event of acts of terrorism.  It creates something like a federal reinsurance program in cases of terrorism.  In exchange for this protection, the insurance industry must offer terrorism coverage and cover a certain amount of losses before federal assistance kicks in.  The law has been extended several times since 2002, but regrettably, Congress let it lapse on December 31, 2014.

With a new Congress convening this week, employers and insurers are hopeful that TRIA will be renewed shortly.  Without TRIA protection, businesses and insurers could be left without adequate insurance in the event of a terrorist attack.  The risks are probably greatest in urban areas, particularly in large American cities. Congress is playing with fire in allowing TRIA to lapse.

Employers and practitioners should be aware of the importance of TRIA in workers’ compensation and should consider contacting their Congressional representatives to urge the renewal of TRIA as soon as possible.

There are few Appellate Division cases dealing with the requirements on an employer/carrier with respect to home modifications when an employee has suffered catastrophic injuries. For this reason, the decision in Loeber v. Fair Lawn Board of Education, A-1990-13T1 (App. Div. December 5, 2014) is important for practitioners in New Jersey.

Mr. Loeber was injured at work in November 2009 and became partially paralyzed requiring the use of a wheelchair. In October 2011, Loeber sought modifications to his home and vehicle, as well as psychiatric care.  The Board provided psychiatric care and resolved all issues with respect to his vehicle.  The Board also agreed to provide certain modifications to the home without the necessity of medical reports.  However, some of the requested modifications remained in dispute.

Trial began in the Division of Workers’ Compensation in 2013, and Loeber testified that he wanted the whole of his house, not just the first floor, to be accessible to him.  He sought access to the second floor, where his son’s bedroom was, as well as access to his basement, where he wanted to do woodworking.  Loeber offered an expert in home modifications who recommended expansion of the kitchen, raising the family room floor, and installing a life platform at the front door.  The expert admitted that he did not take cost into account.

The Board of Education produced a licensed occupational therapist as its expert.  She agreed with some of the recommendations of petitioner’s expert but disagreed with others.  She recommended that the workshop be built in the garage and the son’s bedroom be moved to the first floor.

The Board’s attorney wrote to petitioner’s attorney after petitioner’s expert testified.  Board counsel conceded that there was no need for medical testimony by petitioner that he needed to be in a wheelchair.  Counsel pointed out, however, that the Board was not waiving any need for expert testimony as to the issue of whether renovations are required to address the psychological effects of Loeber’s injury.

The Judge of Compensation visited Loeber’s home twice.  She found Loeber’s testimony to be entirely credible as to what he could and could not do.  On November 23, 2013, the Judge of Compensation rendered her decision stating that she found petitioner’s expert to be more credible and ordered the home modifications sought by Loeber.  Respondent appealed.

The Board of Education focused its appeal on four issues:

1. installation of an elevator to take Loeber from the main floor to the second floor and basement;
2. lifting the floor of the family room to provide better access to the kitchen;
3. modification of the kitchen to permit Loeber to use it safely;
4. reimbursement for the installation of a turn platform at the end of a wheelchair ramp leading to the rear entrance to the house.

The court reviewed the leading case in New Jersey on these issues, Squeo v. Comfort Control Corp., 99 N.J. 588 (1985).  The Supreme Court held that there was competent medical testimony supporting the need for the carrier to construct an apartment addition to Mr. Squeo’s home to relieve Mr. Squeo of his severe mental depression.  The Supreme Court cautioned that only an unusual case would warrant such extraordinary relief. The Court held that the apartment was necessary to address the psychological effects of petitioner’s injury, rather than his physical disability.  The Court added that cost of renovations was a legitimate consideration.

The Appellate Division observed that the Judge of Compensation found that Loeber’s “long-term mental health will be enhanced by having the ability to live in a barrier free home with his wife and preadolescent son.”  However, the court noted that there was no psychological testimony in this case. The court also noted that there was no analysis of cost.  Nonetheless, the Appellate Division largely affirmed the findings of the Judge of Compensation. “Having reviewed the record in light of the applicable law, we nevertheless conclude that the judge’s overall conclusions are supported by the record and applicable law with respect to all contested issues except the elevator.”

The Appellate Division affirmed the judge’s first-hand observations from her visit to Loeber’s home, namely that the existing ramp from the family room to the kitchen was dangerous, and that kitchen modifications were needed to allow Loeber to safely use the stove, cooktop, sink, and other parts of the kitchen.  The court cautioned that the Board must submit a plan for the renovations to Loeber, who should have a reasonable period of time to respond with alternatives.  Should the parties reach an impasse, those issues would be resolved by the Judge of Compensation.

On the issue of the home elevator, the court reversed the decision of the Judge of Compensation, noting that no expert testimony was offered by petitioner in support of his request for the elevator. “While the elevator would appear to be beneficial, there is nothing in the record to demonstrate that it is ‘necessary’ and its cost ‘reasonable’ as those terms are used in Squeo.  Ibid. The compensation judge was required to reach a decision consistent with Squeo, which ‘cautioned’ that it is ‘only the unusual case that may warrant . . . extraordinary relief.’ Id. at 604.  Based on the current state of the law, as set forth in Squeo, and the present record, we cannot agree that Loeber demonstrated that the elevator was ‘necessary.’”

Although this case is unreported, it is crucial for practitioners to read because it is one of only a handful of appellate level cases dealing with catastrophic injuries.  In regard to the need for medical testimony, the court seems to draw a distinction between those renovations which pose a safety risk and those that address quality of life issues.  Regarding conditions that involve safety, danger or essential life functions, (ramps, access to stoves, preparing meals), no medical expert testimony was required.  The judge’s first-hand observations together with the conclusions of the home modification expert were sufficient.  But in respect to quality of life issues like the elevator, the court clearly felt that testimony from a medical expert, such as a psychologist or psychiatrist, would be required to address the psychological impact of the injury on the petitioner.