Opinion
W.C. No. 4-384-715
April 30, 2002
FINAL ORDER
The respondents seek review of an order of Administrative Law Judge Wheelock (ALJ). The respondents contend the ALJ erroneously increased the claimant's average weekly wage to include the employer's cost of group health insurance. We agree and, therefore, reverse.
In 1998 the claimant suffered a work-related injury. The claimant was enrolled in a group health insurance plan which cost the respondent-employer $395.60 per month. The claimant's contribution was approximately $88.62 per month. The parties stipulated that two months before the industrial injury, the claimant withdrew from the respondent-employer's plan and joined his wife's health care plan with another employer because it provided greater coverage. (Tr. June 20, 2001, pp. 4, 5).
The respondents admitted liability for temporary and permanent disability benefits based on an average weekly wage of $468.27. The claimant objected and requested the ALJ increase the average weekly wage to include the respondent-employer's contribution to the group health insurance plan.
Expressly relying on § 8-42-102(3), C.R.S. 2001, the ALJ found it "reasonable and appropriate" to increase the claimant's average weekly wage to include the employer's contribution to the claimant's health care benefits. Consequently, the ALJ increased the average weekly wage to $556.23.
Workers' compensation benefits are based on the average weekly wage. The term "wage" is defined as the "money rate at which the services rendered are recompensed under the contract of hire in force at the time of the injury." Section 8-42-102(3) affords the ALJ discretion to calculate the claimant's average weekly wage by any method as will in the opinion of the ALJ "fairly determine" the claimant's average weekly wage. We may not interfere with the ALJ's calculation of average weekly wage unless an abuse of discretion is shown such as where it is not supported by substantial evidence or is contrary to law. Coates, Reid Waldron v. Vigil, 856 P.2d 850 (Colo. 1993).
The term "wages" also includes "fringe benefits" expressly enumerated in subsection 8-40-201(19)(b), C.R.S. 2001. See City of LaMar v. Koehn, 968 P.2d 164 (Colo.App. No. 1998). Insofar as pertinent, the term "wages" includes:
"the amount of the employee's cost of continuing the employer's group health insurance plan and, upon termination of the continuation, the employee's cost of conversion to a similar or lesser insurance plan." (Emphasis added).
The purposes of the statute is to ensure that where the employer is providing group health insurance at the time of the industrial injury, the claimant has sufficient funds available to purchase similar or lesser health insurance. Humane Society of the Pikes Peak Region v. Industrial Claim Appeals Office, 26 P.3d 546 (Colo.App. 2001).
Here, the stipulated facts reveal the claimant voluntarily withdrew from the respondent-employer's group health insurance prior to the industrial injury but retained the option to re-enroll at any time. Contrary to the ALJ's determination, the stipulated facts compel the conclusion that at the time of the injury the claimant's wage did not include fringe benefits in the form of employer paid health insurance coverage. See Schrieber v. Brown Root, Inc., 888 P.2d 274 (Colo.App. 1993) (where undisputed facts lead to only one conclusion the issue is a question of law). Instead, the claimant only had a right to exercise an option to receive employer paid health insurance. The record contains no evidence there was any cost for the option of rejoining the employer's health insurance plan or converting the option to a similar or lesser option. Therefore, the record is legally insufficient to support the ALJ's implicit determination that the claimant's wage includes the cost of group healthy insurance.
In any case, § 8-40-201(19)(b), provides that only the "employee's cost of conversion to a similar or lesser insurance plan which may be included in the average weekly wage. Schelly v. Industrial Claim Appeals Office, 961 P.2d 547 (Colo.App. 1997). Therefore, the ALJ misapplied the law in finding that the "employer's" cost of providing group health insurance may be included in the claimant's average weekly wage.
We have reviewed the record and there is no evidence concerning the claimant's cost of securing "similar or lesser insurance." Neither is there evidence of the claimant's cost to join his wife's group health insurance plan. In this regard, we recognize the claimant's hearing exhibits include a benefit options statement prepared for "Cheryl L Callahan" which lists the costs of several group health insurance plans. (Tr. June 20, 2001, pp. 3, 5; exhibit pp. 2, 3). However, the exhibit does not identify what plan was selected and whether coverage was selected for "Employee Spouse" or "Employee Family."
Further, the statement's of claimant's counsel concerning the wife's "value" of the replacement cost cannot substitute for evidence not in the record. ( see Tr. June 20, 2001, p. 6); Subsequent Injury Fund v. Gallegos, 746 P.2d 71 (Colo.App. 1987). Moreover, the "value" of the wife's plan is not evidence of the claimant's cost of converting to the wife's plan. See Smith v. Teledyne Water Pik, W.C. No. 4-101-833 (January 10, 1995).
Under these circumstances, the ALJ's determination that the "fair determination" of the claimant's average weekly wage includes the amount contributed by the respondent- employer to the claimant's group health insurance was an abuse of discretion. . See Coates, Reid Waldron v. Vigil, supra; Turner v. Technology Products Inc., W.C. No. 3-965-536 (April 30, 1996) ; Smith v. Teledyne Water Pik, supra.
IT IS THEREFORE ORDERED that the ALJ's order dated June 29, 2001, is reversed.
INDUSTRIAL CLAIM APPEALS PANEL
____________________________________ Kathy E. Dean
____________________________________ Robert M. Socolofsky
NOTICE
This Order is final unless an action to modify or vacate this Order is commenced in the Colorado Court of Appeals, 2 East 14th Avenue, Denver, CO 80203, by filing a petition for review with the Court, within twenty (20) days after the date this Order is mailed, pursuant to § 8-43-301(10) and § 8-43-307, C.R.S. 2001. The appealing party must serve a copy of the petition upon all other parties, including the Industrial Claim Appeals Office, which may be served by mail at 1515 Arapahoe, Tower 3, Suite 350, Denver, CO 80202.
Copies of this decision were mailed April 30, 2002 to the following parties:
Ronald A. Callahan, 2347 Legend Dr., Colorado Springs, CO 80920
Smith Brothers Electric, Inc., P. O. Box 49335, Colorado Springs, CO 80949
Michael J. Steiner, Esq., Pinnacol Assurance (CCIA) — Interagency Mail (For Respondents)
Steven U. Mullens, Esq., P. O. Box 2940, Colorado Springs, CO 80901-2940 (For Claimant)
Richard M. Lamphere, Esq., 111 S. Tejon, #700, Colorado Springs, CO 80903
BY: A. Hurtado