Tag Archives: permanent disability

The hidden variable of employer perception of disability in workers’ compensation

Posted on July 25, 2022 by Jon Rehm

If you believe your typical insurance adjuster, the only way an employee can get paid money benefits is if a doctor has assigned permanent impairment and/or restrictions for a work injury.

At least in Nebraska, a competent workers’ compensation lawyer would tell you that a judge can take a workers’ testimony about their injury and ability to work when deciding to pay money benefits for either temporary or permanent disability.

But what often goes unmentioned in this discussion, is how employer’s perception of their injured workers’ ability to work factors into decisions to pay money benefits to injured workers.

So how does what an employer thinks about an employee’s injury factor into how money benefits get paid in Nebraska workers’ compensation cases?

Temporary disability

Employees are paid temporary disability while they are under doctors’ treatment, recovering from an injury and unable to work because of a work injury. Conventional wisdom holds that temporary disability ends when a medical doctor states an employee is at maximum medical improvement or MMI.

But who really decides whether an employee can work or not? The employer. In practice, nurse case managers will coordinate with an insurer/claims administrator and employers to sync the MMI date with when the employer thinks they have a job for an employee.

“Personal conditions” and temporary disability

Often times an employee will be unable to do their job after the mythical MMI date. (MMI is something decided by a judge anyway) Sometimes employers/insurers will argue that an employee is unable to work because of personal condition. In reality an employer may have pushed an employee to return to work too quickly and/or pushed for inaccurate work restrictions.

But regardless of whether an employer believes an employee can’t work because of a work injury or a non-work related injury, they still believe that the injured employee is unable to work for them. Ultimately, it’s up to a workers’ compensation court judge to decide whether the condition preventing an employee from working is related to work or not. However, the decision to pay temporary benefits turns in a substantial part about the court’s view of how the employer views the employee’s ability to work.

Permanent disability

Per Neb. Rev. Stat. 48-121(3), back injuries, head injuries, mental injuries, burns and multiple body part injuries are paid on how the injury effects a persons ability to earn wages. An employer admission that an employee can’t work for them anymore can often be evidence of what is more formally called loss of earning capacity. Even an admission that an employee who is still employed at the same or higher wage is working a lighter job can be evidence of loss of earning power.

Vocational rehabilitation benefits

Employees can receive money benefits if they are participating in a vocational rehabilitation program. Again the decision about whether an employee gets vocational rehabilitation benefits often hinges on whether an employer can or is willing to accommodate the permanent effects of an employees injury. (Employees can also get vocational rehabilitation for so-called single member injuries like shoulders, knees and feet)

Why employer perception of employee work ability sometimes gets overlooked in workers’ compensation cases.

I have had five workers’ compensation trials this year. Employer representatives only testified in two of those hearings. In two of my trials, my client was the only live witness. I think this is typical of how trials usually go. Employee testimony is usually used to help the court understand the basis for the medical reports that are introduced into evidence before testimony and to judge the credibility of the injured workers.

Sometimes employers are almost irrelevant to the issues the court needs to decide. But sometimes, I think defendants keep the employer off the stage in order to focus attention on what they perceive as a flawed plaintiff and to keep the focus off potentially questionable conduct by the employer.

Employers often start their attack on a plaintiff’s credibility with a deposition. Depositions are expensive, but most defendants are insurance companies or self-insureds with deep pockets. Plaintiffs in workers’ compensation claim don’t have deep pockets, so a different cost-benefit analysis applies when deciding whether the depose an employer witness.

But a plaintiff may be able to subpoena that witness to testify at trial for far less cost and should be able to use written discovery like interrogatories, requests for production and requests for admission to conduct an adverse or hostile examination to prove up a clients case for workers’ compensation benefits with admissions from employers.

How history explains why workers compensation benefits don’t increase for the cost of living in Nebraska

Posted on March 1, 2021 by Jon Rehm

Increases in the cost of living, or inflation, are taken for granted by most people — except for seemingly in the world of workers compensation. I’ve written two posts recently ( here and here ) about how courts fail to take inflation into account when determining permanent disability benefits.

But in fairness, increases in the cost of living aren’t factored directly into workers’ compensation laws in Nebraska. Some states don’t even increase maximum benefit rates like Nebraska.

So why is it that states like Nebraska don’t include cost of living into permanent disability benefits? I think economic history provides the answer.

The economic world of those who created workers’ compensation

Workers’ compensation laws were enacted in the early 20th century in response to industrialization in the late 19th century. In a very readable section of “Capital in the Twenty-First Century” economist Thomas Piketty pointed out that prices and the value of money stayed stable from the end of the Napoleonic Wars until World War I (1815-1914)

Since World War I, prices have increased, so today we assume some inflation. But the drafters of workers’ compensation laws didn’t share that assumption. Their experience was that prices stayed consistent, so it wouldn’t be necessary to link lifetime or long-term benefits to increases in the cost of living.

Other states do have cost of living increases factored into permanent disability payments. Illinois created their rate adjustment fund in 1975. Social Security also has a cost of living increase factored into benefits. But these are policies enacted in periods when lawmakers assumed some increase in the cost of living was inevitable.

Permanent disability awards as a debt owed to injured workers

I hope Nebraska lawmakers will one day enact cost of living increases into Nebraska workers’ compensation laws. Permanent disability benefits should be thought of a debt owed by employers and insurers to injured workers. As it stands now, employers and insurers in this are allowed a partial debt jubilee in Nebraska on permanent and long-term benefits because those benefits don’t account for a cost of living. (This is a separate issue from the overly generous discount rate which give employers even more relief on lump sum payments of permanent disability claims).

I see posts on social media about why shouldn’t forgive the student debt for the modern day welfare queen who borrowed $80,000 for a philosophy degree. After the housing bubble crashed in 2008, I saw all sorts of posts about why irresponsible borrowers shouldn’t be bailed out. I’ve never seen a meme about insurers being able to legally shirk their debts to injured workers.

Ghosted by your workers’ comp. insurance company?

Posted on September 7, 2020 by Jon Rehm

The workers’ compensation insurance industry likes to talk about patient advocacy. But after a certain point in a claim, injured workers are often left hanging by insurance companies and the nurse case managers they hire to manage employee medical care.

Workers left in a lurch by insurers are often confused or ignorant about how to proceed in a claim. And surprise, surprise, insurers use this ignorance and confusion against injured workers.

Here are some common scenarios when injured workers get ghosted by insurers or nurse case managers in workers’ compensation claims.

Medical care

Employers have an affirmative and ongoing duty to offer medical care to injured workers . But what happens when a doctor, particularly, a surgeon states an employee is done with treating a work injury and employee is still in pain? Bluntly often this means that an employee stops getting treatment. But assuming an employee has the ability to get medical care outside of workers’ compensation, an employee still faces challenges.

If an employee seeks treatment for pain and that treatment is related to the injury, sometimes employers will argue that they don’t have to pay for that treatment. Nebraska Workers’ Compensation Court Rule 50 holds an employee is stuck with the doctor they chose at the beginning of the claim unless 1) the defendant denies medical care or 2) the parties agree to a change or 3) the court orders a change.

What constitutes a denial of care is a crucial question. Employers have an affirmative and ongoing duty to offer medical care to injured workers. The safest route for an employee is to ask the insurer to approve medical care. But that isn’t always possible if employees don’t have that information or adjusters don’t respond to inquiries. Insures also tend to ignore injured workers who don’t have a lawyer.

Arguably, not offering medical care is a denial of compensability, so an employee can chose to any provider doctor and have those bills paid. An ongoing and affirmative duty to offer care should mean an employer can’t get out of paying medical bills just because the stopped communicating with you about your claim. However, getting medical bills paid in that situation will probably involve hiring a lawyer and going to court. Many employees are intimidated by that process.

Why employers should offer you medical care

Employers have good reason to offer ongoing medical care. First of all, an injured worker can lose out on disability benefits if they decline medical care Neb. Rev. Stat 48-120(2)(c). By offering medical care, an employer can also maintain control over medical care. A recent case provides a good example of the protections that employers are entitled to if they offer medical care.

The Nebraska Supreme Court held in Rogers v. Jack’s Supper Club that an employer was not responsible for paying for bills incurred for treatment in Florida for an employee who moved from Nebraska to Florida. The court held so because the employee didn’t ask to formally change doctors from the court or the employer.

I think Jack’s Supper Club is a harsh result. I believe Neb. Rev. Stat. 48-120(6) gives judges broad latitude to order changes of doctors under Rule 50. But in that case the defendant actually offered medical care to the injured employee. Arguably, the defendant in that case, met their affirmative duty to offer medical care and did not deny compensability.

Aren’t they supposed to pay me something?

While employers have a duty to offer you medical care for a work injury, their duty is less clear when it comes to paying permanent disability benefits. Again, insurers and nurse case managers tend to disappear after surgical care ends. Usually when a surgeon releases an injured worker from care they are deemed to be at maximum medical improvement or MMI.

I’ve written quite a bit about employers/insurers short change employees by ending payment of temporary disability and delaying payment of permanent disability. But that squeeze or delay presumes an employee actually gets paid permanent disability. In order to get paid disability for an injury to a specific body part, a doctor generally needs to give an impairment rating. But usually someone needs to ask for and pay for an impairment rating.

Often times insurance types just don’t ask for the impairment rating. Once they insurer gets an impairment rating, they have 30 days to pay the value of the impairment rating to an injured worker. But they don’t have a spelled out duty under Nebraska law to ask for an impairment rating the same way they have a duty to offer medical care.

I would argue the beneficent purpose of the Nebraska workers’ compensation act would give insurers a duty to ask for an impairment rating. But it might be up to the Unicameral to impose that duty on insurers.

Do I have an impairment rating for my injury?

If you had surgery, you almost certainly have an impairment rating. That impairment rating is likely worth at least a few thousand dollars of tax free money. If you have had surgery there is a reasonable possibility you will need some medical care in the future. Impairment ratings and future medical care cost insurance companies money. One reason that insurers and employers ghost injured workers is that they are hoping they won’t make additional claims or ask for payment of benefits that they are owed.

Does higher unemployment mean higher workers’ compensation benefits?

Posted on June 29, 2020 by Jon Rehm

Last fall, I wrote about my opinion that good economic conditions often lead workers to be underpaid for work injuries.

But will that conclusion change now that unemployment has increased to historic highs? Maybe, here is how I believe higher unemployment could affect the value of workers’ compensation cases.

Loss of earning power

Nebraska law pays back injuries, head injuries, mental injuries, burns, multiple body part injuries on how they impact your ability to work. Nebraska calls the impact of a work injury on your ability to work “loss of earning power” or “LOEP” for short. A medical opinion about the harm, restrictions or loss of use caused by an injury is just starting point in deciding loss of earning power.

Courts consider social and economic factors along with physical restrictions in calculating loss of earning power. Those other factors include: education, age, where you live and transferable skills.

The competitive labor market

Where you live is important because it gives the court an idea of the jobs available to you. Oftentimes in workers’ compensation cases there is an argument about which cities or areas to include in a job market. But the mere availability of work in your area doesn’t determine your loss of earning power.

Under Nebraska law, loss of earning power is based on a competitive labor market. When times are good, the players in the workers’ compensation system ignore the idea of a competitive labor market.

But when unemployment rises, lawyers, judges and vocational counselors, (the experts who help decide LOEP) may remember the idea of a competitive labor market. In a competitive labor market, someone who lost a job due to a work injury is going to have difficulty finding a job. The same goes for workers with serious work restrictions.

Retail jobs, along with food service jobs, are considered by many to be an employer of last result. But when unemployment spiked in March, Wal-Mart has 1,000,000 applicants for 150,000 open jobs. In comparison, Ivy League school Cornell University accepted 14.1 percent of applicants in this year. So I think it’s fair to say that the labor market is competitive. (I’ve noticed a lack of articles about the “skills gap” and “employee ghosting” since March)

No place like Nebraska?

Under Nebraska law, judges decide loss of earning power based on local economic conditions.. The good news/bad news for Nebraska workers is that Nebraska still has the lowest unemployment in the nation. Nebraskans may not see a major increase in permanent disability benefits due to economic conditions.

But workers who live outside of Nebraska can claim Nebraska workers compensation benefits. Generally they can claim benefits if they were hurt in Nebraska, hired in Nebraska or their employer is based in Nebraska. Residents of other states would have their loss of earning power or disability determined based on where they live. These workers may see increased permanent disability benefits.

Three partial fixes for difficult workers’ compensation problems

Posted on February 10, 2020 by Jon Rehm

A lot of my blogging stems from my experience representing my clients in workers’ compensation cases. Last fall, I wrote a couple of posts: “Why so few workers get vocational rehabilitation in Nebraska” and “Why injured workers stop going to the doctor even if they are still in pain” after hard fought litigation had concluded.

I don’t know if it is apparent from the tone of those posts, but they were written from a sense of discouragement and disappointment. In both posts I wrote about the difficulties that injured workers have in receiving fair workers’ compensation benefits.

Law students, law professors and other legal analysts spot legal problems; trial lawyers need to find solutions for legal problems. After reading and reflecting, I’ve come up with three partial solutions for two major problems for injured workers in workers compensation cases.

None of these solutions are ideal or useful in every circumstance. These problems call out for pro-worker reforms to workers’ compensation laws, but even without “structural” solutions, lawyers for injured workers don’t just have to throw up their hands and tell their clients there is nothing they can do for them when faced with these difficulties.

Problems: The TTD/PPD gap.

Solution: Apply for unemployment.

I feel like I’ve written extensively about the problem of the long delay between when temporary benefits end and when permanent disability benefits start. Tara Reck in Washington state wrote a post about advising clients to apply for unemployment benefits in that situation. I kicked myself for not thinking of that before. (By the way, Washington cuts off temporary benefits after a vocational counselor determines an employee can return to work. That would significantly shorten the gap time.)

Applying for UI benefits in this situation is a good idea for a lot of reasons. One, Once a worker is at MMI, they are usually able and available for work. Two usually unemployment requires an extensive job search as a condition of receiving benefits. That job search can be evidence in a workers’ compensation case which can help prove up permanent disability. Evidence of a diligent job search by an injured worker usually also boosts credibility with a judge

Finally, a successful application for unemployment benefits means that an employee has steady income and maybe even finds a job. Having a steady income lessens the pressure on the injured worker to settle their workers’ compensation case.

Problem: The delay between the end of TTD and beginning of PPD

Solution: Ask court to appoint counselor for LOEP with just FCE restrictions

Part of the delay between the end of temporary and start of permanent disability benefits is the difficulty in figuring out disability. Part of this delay can be explained by the practice of having a doctor ratify or sign off on functional capacity evaluation or FCE results obtained by a physical therapist. Doctor-endorsement of work restrictions is believed by some to be necessary for the appointment of a vocational counselor to perform a loss of earning power evaluation.

Physical therapists have an uncertain status as experts within the workers’ compensation court. But I was able to get a vocational counselor appointed with just FCE restrictions from a PT. (Feel free to contact me for a copy of the order) As a precaution, I did get the findings endorsed by a medical doctor. But I would encourage other plaintiff’s lawyers to push the issue with the trial courts in Nebraska. I believe trial judges are aware of the gap issue and are sympathetic to employees on the issue. With a concerted effort, the plaintiff’s bar in Nebraska may be able to reverse the custom of having a medical doctors endorse FCE restrictions from a physical therapist.

Problem: Future medical in a denied claim where the employee can’t afford future medical care.

Solution: Use company provided medical care

I wrote a post about why injured workers stop going to the doctor even if they are in pain. One of the main reasons why employees stop seeking care is cost. Another reason why employees stop seeking care is because employers manage medical of their injured workers and encourage doctors to release workers without recommendations for future medical care. This problem is particularly acute for employees of self-insured companies or quasi self-insureds with high deductible coverage.

But these self-insured employees usually often provide onsite occupational clinics. These providers are often on the front-line of discouraging claims. Many injured workers don’t seek treatment there because of that reason.

But those clinics are convenient and free of charge to employees who use them. They are a good way to bolster the case future medical if an employee is regularly seeking treatment there for work-related symptoms. The fact that an injured worker continues to seek treatment at onsite clinic can also help their case by adding legitimacy to their testimony about the nature and extent of their limitations and symptoms from their work injury.

These occupational health notes are a discovery gold mine in my view. Not only do they give you what amounts to a free medical summary, they also document time off work which is incredibly helpful in proving entitlement to temporary disability benefits. The notes can also be a good source for admissions against interest by the employer.

How Nebraska law shortchanges injured workers

Posted on November 18, 2019 by Jon Rehm

Workers compensation is a defined benefit that pays certain benefits for work injuries regardless of fault. But when defined benefits aren’t well-defined, injured workers get short-changed when it comes to workers compensation disability benefits.

Underpayment of benefits is already baked into Nebraska workers’ compensation law for some workers. Nebraska usually does not take overtime pay into consideration when determining disability benefits. Nebraska also caps workers’ compensation benefits at a maximum rate.

Here is the how and why fuzzy math can lead injured workers can get underpaid benefits in Nebraska. I think you can break down the reasons that workers get underpaid into disputes over wage rates and the time periods they are entitled to benefits

Wage rate

Average weekly wage and abnormally low weeks

Permanent and temporary disability benefits are controlled by the average weekly wage under the Nebraska Workers Compensation Act. The average weekly wage is usually based on an average of the past 26 weeks of wages minus “abnormally low weeks”. What’s an abnormally low week? There isn’t a hard and fast rule. For the purposes of permanent disability Nebraska workers compensation law assumes a 40 hour work week. This assumption helps address underpayment issues for permanent disability.

But no such assumption exists for temporary disability under Nebraska workers compensation law. So insurers and claims administrators have wide latitude to underpay temporary benefits. This is particularly harmful as workers who are temporarily disabled are often entirety unable to work.

Shift differentials

Workers who work evening and overnight shifts often get paid shift differential on top of base pay. Particularly if a worker works a combination of day and evening shifts, workers compensation benefits tend not to account for shift differential.

Time Period

The gap between temporary and permanent disability

Nebraska law is unclear as to when temporary disability ends and when permanent disability ends. Not only does this mean injured workers can go months or weeks without benefits, it also means that workers can be underpaid benefits. Usually this underpayment is accomplished by shortening the period of temporary disability paid.

Neb. Rev. Stat. §48-119

Under Nebraska law, the first week of disability after a work injury is not compensated unless the disability lasts for more than six weeks. This tends to happen with injuries that don’t lead to quantifiable impairments. Sometimes, employees under pressure from employers, will be released to work too soon. Insurers and claims administrators view premature returns to work as an excuse to deny temporary disability because they employee is already at maximum medical improvement

The bottom line on underpayment of workers’ compensation benefits

If employees take these claims to court, they can often win back due benefits. These monetary amounts are meaningful for injured workers, but they may not always be cost-effective for an attorney to pursue.

In wage and hour cases under Nebraska and federal law successful claimants are awarded attorney fees that can be much greater than the lost wages collected. These fees encourage lawyers to take these cases.

But under Nebraska workers compensation law a successful claimant needs the court to find there was no reasonable controversy in law or fact for the court to award attorney fees and penalties under Neb. Rev. Stat. 48-125. This is a difficult standard. This difficult standard is made more difficult over disputes over average weekly wage because average weekly wage is a question of law and fact.

In short, Nebraska workers compensation law gives insurers and claims administrators wide latitude to underpay injured workers. But since under Nebraska law it is very difficult to win attorney fees in under Nebraska law, insurers and claims administrators have little to fear in the way of penalties and attorney fees if a court rules they underpaid benefits to an injured worker.

Nebraska comp. court rule changes could help physician-owned hospitals

Posted on January 14, 2019 by Jon Rehm

Lincoln Surgical Hospital (above) could benefit from recent changes to NWCC rules on doctor referral

While Judges debated and rejected changes to rules about expert testimony in the Nebraska Workers’ Compensation Court, there was little discussion about a change to court rules allowing for a controversial practice among doctors.

At last month’s public meeting of the Nebraska Workers’ Compensation court, the court unanimously passed a change to NWCC Rule 50 that allowed doctors to refer to facilities where the doctors have an ownership interest.

Supporters of so-called “physician-owned” hospitals many of which are surgical hospitals, argue that that these facilities provide services at a much lower costs than hospitals. A recent article in The Wall Street Journal detailed how hospital systems can inflate the costs of medical care by limiting referrals of primary care doctors employed by them. Medical costs comprise roughly 60 percent of total workers’ compensation costs. Not surprisingly insurers like doctor-owned hospitals because of the lower costs.

But physician-owned hospitals can’t take Medicare or Medicaid due to changes brought about by the ACA. Hospitals argue that physician owned hospitals shift the cost of poorer and unhealthier patients on to them which is why the ACA disfavored physician-owned hospitals.

Essentially the change to NWCC Rule 50 was a victory for insurers and doctors over hospitals. Since the early 1980s medical expenses have taken up an increasing share of workers’ compensation expenses — now comprising 60 percent of the total expense. If the change to Rule 50 does lead to lower medical costs for the same level of service, then it should be helpful to injured workers because there will be less pressure to reduce benefit levels through legislation.

These legislatively mandated reductions in benefits usually mean worker receiving less compensation for permanent and temporary disability. Reductions in disability for compensation for injured workers has recently been cloaked in legislation adopting the American Medical Association Guide to Permanent Impairment, 6^th Edition which has been the subject of many state-level constiutional challenges from plaintiff’s lawyers.

What’s new for 2019 in Nebraska workers compensation?

Posted on December 31, 2018 by Jon Rehm

The beginning of the year usually sees rule and benefit changes in the Nebraska Workers’ Compensation Court. 2019 will be no different. The maximum rate for disability benefits will increase to $855 to $831. Mileage reimbursement for medical visits and vocational rehabilitation will increase to $.58 per mile from $.545 per mile.

While annual increases in the maximum benefit rate are routine in Nebraska, it is not routine in all states. The annual increase in the maximum benefit rate ensures that compensation stays adequate from both a practical and constitutional perspective.

The minimum benefit remains unchanged at $49.00 per week. That amount has not changed since 1973. That low amount can particularly harm a worker who suffers a serious injury on a second job or part-time job — like a holiday job — if the work injury keeps them from doing a full-time job.

The mileage rate increase might also seem humdrum, but it is common for injured workers in Nebraska to travel relatively long distances to seek care from specialists. An increase in mileage reimbursement of $.035 per mile means another $7 for injured worker who makes a 200-mile roundtrip for medical treatment which is not uncommon in Nebraska.

The Nebraska Workers’ Compensation Court also approved various procedural changes at their meeting on December 20^th.

Rule 2 – Rule 2 regulates filing in the Nebraska Workers’ Compensation Court. Changes to the filing rules mandate the use of registration for the E-File system through Nebraska.gov. Additionally, the court will formally allow pleadings filed by 11:59:59 p.m. central time to be deemed to be filed that day rather than waiting for formal business hours to get a document file stamped. Appeals can now also be filed electronically.

Rule 47 – The change to Rule 47 provides that more detailed information about third-party cases be provided to the court in settlements that require court approval. The court doesn’t have jurisdiction to determine third-party liability but it does have some interest in repayment or subrogation interests under the theory that subrogation interests ensure that medical providers are adequately paid. Case law also provides that protection of a employer/insurers subrogation interest effectuates the beneficent purpose of the act.

Rule 50 – The court ended its prohibition of doctors referring patients to clinics where they have an ownership interest. This rule changes allows for doctors to refer to physican-owned specialty hospitals. These hospitals can perfrom procedures at a lower cost, but the ACA prohibited such facilites from taking Medicare and Medicaid.

The court also adopted a new fee schedule dictating how providers are paid for treating work injuries. You can read about here as to why that is significant here. The court also rejected a change to NWCC Rule 10 prompted by a recent Nebraska Supreme Court decision that you can read about here.

Workers' Compensation Watch

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Tag Archives: permanent disability

The hidden variable of employer perception of disability in workers’ compensation

How history explains why workers compensation benefits don’t increase for the cost of living in Nebraska

Ghosted by your workers’ comp. insurance company?