By: Kevin L. Connors
The Pennsylvania Commonwealth Court recently affirmed the constitutionality of the 2018 IRE provisions under Pennsylvania WCA.
So, as all of us as Pennsylvania practitioners recognize, IREs became an accessible mechanism for capping the potential lifetime exposure of a Pennsylvania Workers’ Compensation claim, in the absence of one of the following events occurring:
(1) The Claimant dies, compensation benefits terminate by operation of both death and loss;
(2) The Claimant voluntarily returns to work in their pre-injury capacities, and there is no continuing wage loss post-return to work, such that the Claimant’s compensation benefits are suspended;
(3) The Claimant returns to work in a modified-duty capacity, with some reduction in return-to-work wages, such that the Claimant’s compensation benefits are modified, and temporary partial disability benefits are paid, subject to the 500 week limitation;
(4) The Claimant executes a Supplemental Agreement, perfecting either a termination, suspension, or modification of the Claimant’s workers’ compensation benefits;
(5) The Claimant signs a Final Receipt (almost never used), under which the Claimant agrees that all compensation benefits have been paid;
(6) The Claimant is deported by virtue of not being able to prove legal immigration status;
(7) The claim is settled under a Compromise and Release Agreement, perfecting some type of compromise of the indemnity and medical compensation benefits liability associated with the claim; and,
(8) The Claimant’s compensation benefits are terminated, modified, or suspended by order of a workers’ compensation judge, with the employer/insurer carrying the burden of proving the entitlement to a change in the Claimant’s benefit entitlement status.
In 1996, the Pennsylvania General Assembly had enacted a provision incorporating an unheard of provision within the Pennsylvania Workers’ Compensation Act, allowing employers/insurers/administrators to seek an impairment rating evaluation of an injured employee who had collected 104 weeks of temporary total disability benefits, and had reached maximum medical improvement from the work injury, through whatever treatments and modalities had been administered in the hopes of restoring functionality and permitting successful returns-to-work.
That mechanism appeared to work for years, until a challenge was raised to that provision in a series of decisions ascending through the fact finding role of the workers’ compensation judge, the appellate review of the Pennsylvania Workers’ Compensation Appeal Board, the Pennsylvania Commonwealth Court, and finally the Pennsylvania Supreme Court, which in the case of Protz v. W.C.A.B.( Derry Area School District), 161 A.3d 827 (Pa. 2017) (Protz II) eviscerated the IRE provisions under Act 57 of the Pennsylvania Workers’ Compensation Act, finding that the provision was an unconstitutional delegation of authority to the AMA, effectively negating the ability of employers/insurers/administrators to utilize an IRE under which an injured employee’s impairment rating was found to be less than 50%, to cap the exposure for the payment of disability benefits to the 500 week maximum recoverable under the temporary partial disability provisions of the Pennsylvania WCA.
You might have to go back and count the commas in the above paragraph.
In any event, the Pennsylvania legislature, in its infinite wisdom, reconstituted IREs in provisions that it adopted and enacted in 2018, under which it was determined that only the 6th edition of the AMA Guides to the Evaluation of Permanent Impairment could be utilized, and that if an IRE resulted in an impairment rating of an injured employee, finding that the injured employee’s impairment rating was 35% or less, the employer/insurer/administrator could then convert the claims of the injured employee’s temporary total disability benefits, potentially payable for a lifetime, to the temporary partial disability benefits, again subject to that 500 week limitation under Section 303(b) of the Pennsylvania WCA.
In response to the 2018 legislative enactment regarding IREs, a constitutional challenge was asserted by the Pennsylvania AFL-CIO, as trustees ad litem for Richard Bloomingdale and Frank Snyder, with the Commonwealth Court rendering an opinion on October 11, 2019, finding that the newly enacted IRE provisions were constitutional, resulting in a deep sigh of relief being heard throughout the Commonwealth from employers/insurers/administrators.
So, what does it all mean?
It means that, at least for the time being, subject to any appeal before the Pennsylvania Supreme Court, that IREs are, at this time, constitutionally affective for managing the potential exposure associated with temporary total disability benefit claims, where 104 weeks of temporary total disability benefits have been paid to an injured employee, and the injured employee has been determined to have reached maximum medical improvement, empowering the employer/insurer/administrator to constitutionally request an IRE, subject to the byzantine provisions of the Pennsylvania WCA, in order to determine if an injured employee has an impairment rating of 35% or less, subjecting the injured employee to the limitation of only being entitled to receive 500 weeks of temporary partial disability benefits, after having received 104 weeks of temporary total disability benefits, still leaving open the possibility that an injured employee with an impairment rating of 35% or less will have received 604 weeks of compensation benefits, with 104 weeks paid as temporary total disability benefits and 500 weeks paid as temporary partial disability benefits, although the benefits may be paid at the same weekly rate, in the absence of any vocational evidence in the form of either a labor market survey, or alternative employment being made available to the injured employee.
Only eleven commas in the above paragraph.
Obviously, we will be tracking the Court’s ruling, to determine if this ruling is challenged before the Pennsylvania Supreme Court. If it is not challenged before the Pennsylvania Supreme Court, under a constitutional challenge, the Commonwealth Court’s ruling would then be final and non-appealable, and would apply to all pending IREs awaiting disposition throughout the multitude of hearing districts in Pennsylvania, with employers/insurers/administrators being able to utilize IREs as a legitimate mechanism for administering potentially lifetime exposure, when confronted with non-catastrophic injury claims.
Trust us, we just get it! It is trust well spent!
We defend Employers, Self-Insureds, Insurance Carriers, and Third Party Administrators in Workers’ Compensation matters throughout Pennsylvania. We have over 100 years of cumulative experience defending our clients against compensation-related liabilities, with no attorney in our firm having less than ten (10) years of specialized experience, empowering our Workers’ Compensation practice group attorneys to be more than mere claim denials, enabling us to create the factual and legal leverage to expeditiously resolve claims, in the course of limiting/reducing/extinguishing our clients’ liabilities under the Pennsylvania Workers’ Compensation Act.
Every member of our Workers’ Compensation practice group is AV rated. Our partnership with the NWCDN magnifies the lens for which our professional expertise imperiously demands that we always be dynamic and exacting advocates for our clients, navigating the frustrating and form-intensive minefield pervasive throughout Pennsylvania Workers’ Compensation practice and procedure.