Summary
In Osinski v. The Humane Society of the Pikes Peak Region, W.C. No. 4-378-187 (May 15, 2000), we held the plain meaning of § 8-40-201(19)(b) incorporates the cost of health insurance coverage provided to the claimant's dependents in cases where the employer's "health insurance plan" allows such coverage.
Summary of this case from In re Gutierrez, W.C. NoOpinion
W.C. No. 4-378-187
May 15, 2000
FINAL ORDER
The respondents seek review of a Supplemental Order of Administrative Law Judge Stuber (ALJ) which increased the claimant's average weekly wage to include the cost of group medical and dental insurance. We affirm.
The ALJ's order is based on the following stipulated facts. The claimant suffered an admitted injury on November 20, 1997. The employer provided modified employment until December 1, 1998. Thereafter, the respondents admitted liability for temporary disability benefits. The claimant objected to the admitted average weekly wage insofar as it purported to include the value of the employer's group health insurance plan.
The employer provided group medical insurance. The premium for an individual policy was $124.26, of which the employer paid $104.74 and the claimant paid $19.52. The claimant also paid $104.74 for dependent coverage for a total premium of $229. Additionally, the employer provided group dental insurance for the claimant and her dependents. The employer paid $47.59 of the premium, and the claimant paid $34.56. The premium for an individual policy was $24.98, of which the employer paid $15.
Section 8-40-201(19)(b), C.R.S. 1999, provides that:
"The term `wages' shall include 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, . . . "
In his Supplemental Order, the ALJ determined that the claimant's average weekly wage included $229 per month, or $52.85 per week, as the claimant's conversion cost for group medical insurance coverage for her and her dependents. In so doing, the ALJ rejected the argument that only that portion of the premium paid by the employer may be included in the average weekly wage.
Further, the ALJ found that the employer's group dental insurance plan falls within the term "employer's group health insurance plan," under § 8-40-201(19)(b). Consequently, the ALJ also increased the average weekly wage by $47.59 per month, or $18.50 per week.
On review, the respondents do not dispute the ALJ's finding that the employer's group dental insurance coverage falls within the term "group health insurance" under § 8-40-201(19)(b). Further they concede that the employer's contribution to the group medical and dental insurance is includable in the average weekly wage. However, relying on State Compensation Insurance Authority v. Smith, 768 P.2d 1256 (Colo.App. 1988), the respondents contend that the ALJ erred insofar as he included the employee's portion of the premiums in the average weekly wage. The respondents argue that the ALJ's calculation results in a windfall to the claimant. Consequently, they assert the ALJ misconstrued the law concerning the "value" of continuing medical and dental insurance coverage to be included in the average weekly wage. We disagree.
The rules of statutory construction require that statutes be construed in such manner as to further the legislative intent for which they were enacted. Salazar v. Industrial Claim Appeals Office, ___ P.2d ___ (Colo.App. No. 99CA0895, February 3, 2000). To discern the intent of the General Assembly, we must first examine the language of the statute. United Airlines, Inc. v. Industrial Claim Appeals Office, 993 P.2d 1152 (Colo. 2000). In so doing, words and phrases should be given their plain and ordinary meaning unless the result is absurd. Wal-Mart Stores, Inc. v. Industrial Claim Appeals Office, ___ P.2d __(Colo.App. No. 99CA0963, March 2, 2000). If the statutory language is clear and unambiguous, the statute must be applied as written, and it is unnecessary to resort to the rules of statutory construction. Grogan v. Lutheran Medical Center, Inc., 950 P.2d 690 (Colo.App. 1997 ).
Notwithstanding the respondents' arguments, we conclude that the plain and ordinary meaning of § 8-40-201(19)(b) is clear and unambiguous. The statute expressly provides that where the employer continues to provide group health insurance coverage, the "employee's cost of continuing the employer's group health insurance plan" is included in the average weekly wage, and when the coverage is terminated the employee's "cost of conversion to a similar or lesser" plan is included. Accordingly, the statute expressly directs the ALJ to include the "employee's" cost of the health insurance premium in the average weekly, regardless of whether the cost was more or less than the cost of the employer-provided insurance. Schelly v. Industrial Claim Appeals Office, 961 P.2d 547 (Colo.App. 1997).
We recognize that this construction arguably creates a potential "windfall" for the claimant, since her portion of the insurance premium was not part of the "money rate" she was recompensed for her services. Consequently, the statute could result in a higher average weekly wage than the claimant's actual wage at the time of the injury. However, the injured employee does not receive one hundred percent of his or her average weekly wage. Rather, the claimant's disability rate is only sixty-six and two-thirds percent of the average weekly wage. Thus, the claimant's benefits do not exceed her earnings, and maximum benefits remain capped in accordance with the Act. Section 8-42-105(1), C.R.S. 1999.
Further, the General Assembly enacted § 8-40-201(19) to ensure that the claimant has sufficient funds available to purchase health insurance regardless of whether the cost is more or less than the employer's cost of providing similar insurance. See Schelly v. Industrial Claim Appeals Office, supra. The legislature apparently determined that this goal could not be achieved unless the claimant's average weekly wage, and resulting temporary disability rate is increased to reflect the employee's cost of obtaining similar or lesser insurance. Indeed, when the employer stops insurance contributions, the claimant may lose the advantage of group rates and be forced to purchase insurance at higher individual rates. To some extent, the statute ameliorates this consequence.
We also note that prior to 1989 the term "wages" included the reasonable value of board, rent, housing, lodging or any other similar employer paid fringe benefits. In 1989 § 8-40-201(19)(a) was amended to narrow the definition of "wages," to exclude "any similar advantage or fringe benefit not specifically enumerated." City of Lamar v. Koehn, 968 P.2d 164 (Colo.App. 1998); Schelly v. Industrial Claim Appeals Office, supra. Therefore, even though the legislature may have increased the relative value of employer paid health insurance, it also depleted the potential average weekly wage by excluding certain fringe benefits from consideration. See Meeker v. Provenant Health Partners, 929 P.2d 26 (Colo.App. 1996). Consequently, the potential "windfall" to the claimant was legislatively offset by the elimination of other fringe benefits includable in the average weekly wage.
State Compensation Insurance Authority v. Smith, supra, was decided under the predecessor statute where the wages were determined by the "value" of fringe benefits, and not the claimant's actual cost of conversion. See Schelly v. Industrial Claim Appeals Office, supra. Therefore, the respondents' reliance on Smith is misplaced.
Moreover, as noted by the court in Schelly, the potential windfall is fact specific. In some cases the cost disparity will enure to the benefit of the employer. For example, in Schelly the claimant's cost of conversion was less than the employer's cost of providing similar group health insurance because the claimant was eligible for Medicare.
Next, had the legislature intended to preclude the cost of dependent coverage from being included the calculation of the claimant's wages, it could have done so by adopting language that only the cost of the employee's individual health insurance coverage is included in the average weekly wage. However it did not do so and we may not read a non-existent provision into the statute. Best-Way Concrete Co. v. Baumgartner, 908 P.2d 1194 (Colo.App. 1995). Therefore, insofar as there was dependent coverage provided by the employer's group health insurance, and the claimant purchased this coverage during her employment, the statute requires that the "cost of conversion" include the cost of dependent coverage.
Here, the parties stipulated that the "cost of continuing this plan remained the same after the claimant's termination." (Stipulation July 23, 1999). Therefore, the record supports the ALJ's finding that the claimant's "cost of conversion" to continue the employer's group medical insurance is $229 per month. Similarly, the parties stipulated that the claimant's cost of continuing the employer's group dental coverage is $47.59 per month. (Stipulation July 23, 1999). Consequently, there is substantial evidence to support the ALJ's determination that the entire dental premium must be included in the claimant's average weekly wage for disability benefits paid after December 1, 1998.
Nevertheless, the respondents contend that there is no evidence the claimant has purchased continuing dental insurance coverage. Therefore, they argue the claimant has not incurred any "conversion cost" to be included in average weekly wage. We reject this argument.
The statute does not require proof that the claimant has actually purchased coverage. When and where to purchase coverage is a decision for the claimant. The statute merely seeks to ensure that the claimant will have funds available to make the purchase.
Our conclusions in Turner v. Technology Products, Inc., W.C. No. 3-965-536 (April 30, 1996) and Quick v. Contractors Crane Service, W.C. No. 4-160-963(May 10, 1995) do not support a contrary result. In Quick the record indicated that the claimant's "cost of conversion" was zero because the claimant continued to receive health insurance coverage, free of charge from his union. Therefore, we concluded the claimant's average weekly did not include any amount for continued group health insurance. Similarly, in Turner, the claimant had no "cost of conversion" because she was covered by her husband's group health insurance, at no cost. See also Smith v. Teledyne Water Pik, W.C. No. 4-101-833 (January 10, 1995) (claimant was covered under her husband's policy, and the husband worked for the same employer therefore, claimant had no cost for continuing coverage). However, we noted in Smith v. Teledyne Water Pik, supra, that if the employer terminated the claimant's access to her husband's health insurance, the claimant's average weekly wage would have to be adjusted to include the claimant's cost of converting to a "similar or lesser insurance plan." Here, unlike Turner, Smith and Quick, the respondents admit that the claimant's conversion cost is greater than zero. Thus, this claim is factually distinguishable from the circumstances presented in those cases.
In any case, the record contains no evidence concerning whether the claimant has or has not purchased continuing dental insurance. In fact, the respondents did not raise this argument before the ALJ. Therefore, it is has not been preserved for appeal.
IT IS THEREFORE ORDERED that the ALJ's Supplemental Order dated January 7, 2000, is affirmed.
INDUSTRIAL CLAIM APPEALS PANEL
____________________________________ David Cain
____________________________________ Kathy E. Dean
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. 1999. 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 May 15, 2000 to the following parties:
Teresa L. Osinski, 48 W. Brookside, Colorado Springs, CO 80906
The Humane Society of the Pikes Peak Region, 633 S. 8th St., Colorado Springs, CO 80905-1809
Laurie A. Schoder, Esq., Colorado Compensation Insurance Authority dba Pinnacol Assurance — Interagency Mail (For Respondents)
William C. Jolliffe, Esq., P. O. Box 2940, Colorado Springs, CO 80901-2940 (For Claimant)
David Krivit, Esq., 600 17th St., #1600N, Denver, CO 80202
BY: A. Pendroy