Here is an update to ”http://www.alabamaworkerscompblawg.com/template_permalink.asp?id=118” a post made late last year about the Protocols v. Leavitt case. In this case a company and a law firm that provided consulting services for the settlement of workers’ compensation claims had brought a declaratory judgment action against the Secretary of the U. S. Department of Health and Human Services and the Administrator of Centers for Medicare and Medicaid Services (CMS) claiming that CMS’ sixth policy memorandum opinion misinterpreted the Medicare statute and regulations and exposed the plaintiffs to unexpected liabilities arising out of settlements they had previously structured. The U.S. District Court for the District of Colorado initially granted the defendants motion for summary judgment, but was subsequently reversed and remanded by the 10^th Circuit Court of Appeals.

Louis Frank Hollander, Jr. v. Raymond Lee Nichols:

On March 20, 2009, the Alabama Supreme Court released this opinion concerning a case wherein an employee sued the authorized treating physician for breach of contract, abuse of process, and defamation. At trial, evidence was introduced that the employee injured his right knee and left ankle on August 27, 1999. On August 30, 1999, the employee was seen by Dr. Glen Sockwell for complaints of stress and shortness of breath. Dr. Sockwell provided a work release slip excusing the employee from work from August 31^st to September 12^th. On September 1, 1999, the employee was seen by the authorized treating physician, Dr. Lee Nichols, regarding his work related leg injuries. Dr. Nichols did not excuse the employee from work. On September 7, 1999, the employee notified the employer that he intended to make a workers’ compensation claim for the stress and shortness of breath. He was told that the claim would be denied and he would not be eligible for benefits while off work pursuant to Dr. Sockwell’s work release slip. As a result, the employee called Dr. Nichols’ office the next day and asked him to back date a work release slip. Dr. Nichols declined the request and noted the same in his records. Per its regular claim procedure, Dr. Nichols’ office forwarded a copy of the records to the employer. Based on the information contained in the records, the employee was terminated for dishonesty. The employee subsequently sued the employer for retaliatory discharge and prevailed at trial. The verdict was later overturned by the Alabama Supreme Court. The employee also filed a separate lawsuit against Dr. Nichols and his medical practice for breach of contract, abuse of process, and defamation. The employee claimed that Dr. Nichols’ account of what happened was untrue and, even it was, the records were improperly disclosed to the employer thus violating the contract of confidentiality afforded to patients. The trial court granted summary judgment in favor of the employer as to all counts. On appeal, the Alabama Supreme Court affirmed the summary judgment as to all counts except the breach of contract claim. The court noted that, while Alabama Code § 25-5-77 provides that a medical provider must provide records and opinions when requested to do so by either the employee or the employer, the request must be in writing. Since there was no evidence before the court that the request was in writing, the Court reversed the summary judgment on the breach of contract claim. Although the employee failed to allege it in this case, the Court noted that Alabama does recognize a tort cause of action for breach of the duty of confidentiality. It is quite possible that such a claim would have also survived summary judgment had it been alleged.

Practice Pointer: Employers, insurance companies, and third party administrators should make it standard operating procedure to issue written requests for records to all authorized treating physicians. On the flip side, all medical providers should insist that all requests be in writing in order to benefit from the protections afforded by Alabama Code § 25-5-77.

The case of Fluor Enterprises, Inc., d/b/a Fluor Signature Services v. Darrell Lawshe was previously reported in this blawg on February 6, 2009. This case put employers, insurers, and third party administrators on notice that they may lose the right to choose the doctor if they deny a claim and it is later determined to be compensable. The dilemma thus becomes...do you deny the claim and risk giving up this important right or do you accept the claim in the hopes that by maintaining control of the medical benefits, you can bring a quick and successful resolution to the claim? Depending on the situation, the best answer may be to do both. There is no reason why you cannot continue to pay for medical treatment while, at the same time, denying the claim. If the judge ultimately rules that the claim is not compensable, then you will owe no future medical benefits.  If the judge deems the claim compensable, then you have protected your right to choose the doctor.

Waters Brothers Contracting, Inc. v. Wimberly:

On March 6, 2009, the Alabama Court of Civil Appeals affirmed the trial court’s decision to award permanent and total benefits for a shoulder injury. The employer based its appeal on the testimony of the treating orthopaedic surgeon who stated that only the employee’s thoracic-outlet syndrome was related to the accident. The surgeon went on to say that the employee’s gout, cervical stenosis, and his degenerative arthritis were not related to the accident. The employer argued that this was important because, if only the thoracic-outlet syndrome is considered, then the only permanent restriction related to the accident was occasional overhead work with the left arm. The employer relied on the fact that a trial court may not consider the effect of adverse health conditions or symptoms not satisfactorily proven to be medically caused by the claimed accident. The Court of Appeals was not convinced that the trial court erroneously relied on the pain and limitations caused by the employee’s gout, degenerative arthritis, and cervical problems. Although the Court acknowledged the testimony of the orthopaedic surgeon, it also noted that the trial court is not bound to accept a physician’s testimony. Rather, the trial court must consider the totality of the evidence. In affirming the trial court, the Court of Appeals considered a second treating physician’s medical records, additional parts of the orthopaedic surgeon’s deposition, and the plaintiff’s own testimony. The Court also pointed out that the fact that the employee went back to work for a short period of time did not disqualify him from being deemed permanently and totally disabled.

One of the easiest ways for an employer to defeat a retaliatory discharge claim is by asserting the defense of collateral estoppel. Specifically, if the employee files for unemployment benefits and the administrative law judge (ALJ) rules that the termination was for any reason other than maintaining or instituting an action to recover workers’ compensation benefits, the issue cannot be relitigated in the retaliatory discharge lawsuit. In other words, whatever the ALJ decides on the issue is controlling in the retaliatory discharge case. This may change if SB 381 is passed. This is a bill that was introduced by Sen. Quinton Ross (D) of Montgomery. If passed, this bill would limit the preclusive effect of a finding of fact, conclusion of law, judgment, or final order made under the unemployment compensation statutes. Further, the bill would preclude an employer from using an employee's previous statements and findings in court in certain cases. SB 381 is pending in the Senate Judiciary Committee and could be considered as early as this week. Remember, you can contact your House and Senate members in Montgomery by calling the House operator at (334) 242-7600 or the Senate operator at (334) 242-7800, or writing to them via the State House Office Building, Montgomery, Alabama 36130. You can also visit the Legislature's official web site at: http://alisondb.legislature.state.al.us/acas/ACASLogin.asp.