Opinion
W.C. No. 4-242-542
December 22, 2000
FINAL ORDER
The respondents seek review of an order of Administrative Law Judge Coughlin (ALJ) which required them to pay penalties for the wrongful termination of temporary disability benefits. We affirm.
On December 23, 1994, the claimant suffered an admitted back injury which was treated by Dr. Ladwig. Dr. Ladwig placed the claimant at maximum medical improvement (MMI) in December 1995. The claimant contested Dr. Ladwig's opinion and requested a Division-sponsored independent medical examination (DIME). The DIME physician, Dr. Machanic, opined the claimant was not at MMI because she required treatment for psychological and upper extremity problems including carpal tunnel syndrome (CTS) which were caused by the industrial accident. In an order dated August 21, 1997, former ALJ Gandy determined the respondents failed to present clear and convincing evidence to overcome Dr. Machanic's opinions. Therefore, the ALJ determined the claimant was not at MMI, and ordered the respondents to provide additional medical treatment from Dr. Neal.
At the respondents' request, the claimant was reexamined by Dr. Ladwig on August 18, 1998. Dr. Ladwig diagnosed the claimant with a "dorsal spine strain," placed the claimant at MMI and discharged the claimant from treatment. Dr. Ladwig also assigned a four percent whole person impairment due to impaired range of motion in the thoracic spine.
Relying on Dr. Ladwig's opinions, the respondents filed a Final Admission of Liability which terminated temporary disability benefits effective August 18, 1998, and admitted liability for permanent partial disability benefits based upon four percent whole person impairment. The claimant objected to the final admission and sought penalties for the respondents' unilateral termination of temporary disability benefits in violation of the Rules of Procedure, Part IX(C)(1)(a), 7 Code Colo. Reg. 1101-3 at 34.
The ALJ found the claimant suffered a multi-faceted industrial injury. The ALJ also determined that MMI is not divisible. Under these circumstances, the ALJ determined Dr. Ladwig's August 1998 finding of MMI for a "dorsal spine strain" was a "partial" determination of MMI. The ALJ further determined that the respondents knew or should have known that the claimant's CTS and psychological problems are causally related to the industrial injury. Consequently, the ALJ determined the respondents' unilateral termination of temporary disability benefits was not based on a rational argument in fact or law and imposed penalties of $100 per day from August 18, 1998, to February 17, 1999.
On appeal, the respondents contend they were required by Rule IV(N)(5) to accept Dr. Ladwig's finding of MMI and either admit liability for permanent partial disability benefits consistent with his medical impairment rating or request a DIME to dispute the rating. Further, the respondents contend the claimant waived the right to dispute Dr. Ladwig's opinion that she was at MMI by failing to request a DIME. Therefore, the respondents argue they were required to terminate temporary disability benefits based upon Dr. Ladwig's finding of MMI. We disagree.
The courts have held that the failure to comply with the Rules of Procedure may subject the insurer to penalties under § 8-43-304(1), C.R.S. 2000. Monfort Transportation v. Industrial Claim Appeals Office, 942 P.2d 1358 (Colo.App. 1997). That statute allows an ALJ to impose penalties up to $500 a day for the insurer's violation of a procedural rule. The imposition of penalties under § 8-43-304(1) requires a two step analysis. The ALJ must first determine whether the disputed conduct constituted a violation of a procedural rule. Allison v. Industrial Claim Appeals Office, 916 P.2d 623 (Colo.App. 1995). If the ALJ finds a violation of a rule, penalties may be imposed if the ALJ finds the respondents' actions were not objectively reasonable. Colorado Compensation Insurance Authority v. Industrial Claim Appeals Office, 907 P.2d 676 (Colo.App. 1995). The reasonableness of the respondents' actions depends upon whether the actions were predicated on a rational argument based in law or fact. Diversified Veterans Corporate Center v. Hewuse, 942 P.2d 1312 (Colo.App. 1997). Determination of whether the respondents' conduct was reasonable is generally dependent on the particular facts of the case. See Pueblo School District No. 70 v. Toth, 924 P.2d 1094 (Colo.App. 1996). Consequently, we must uphold the ALJ's determinations if supported by substantial evidence in the record. Section 8-43-301(8), C.R.S. 2000.
Rule IX(C)(1)(a) allows an insurer to terminate temporary disability benefits without a hearing by filing an admission of liability form with a medical report from an authorized treating physician stating the claimant has reached MMI. Rule IV(N)(5) provides that within 20 days of the date of receipt of an authorized treating physician's determination of MMI and rating of permanent medical impairment, the respondents must either admit liability for permanent medical impairment benefits consistent with the rating or request a DIME. Neither rule applies in the absence of a medical determination of MMI.
Under § 8-42-107(8)(b)(I), C.R.S. 2000, the initial determination of MMI is to be made by an authorized treating physician. Aren Design, Inc. v. Becerra, 897 P.2d 902 (Colo.App. 1995). Neither party may dispute the accuracy of the treating physician's MMI determination in the absence of a DIME. Blue Mesa Forest v. Lopez, 928 P.2d 831 (Colo.App. 1996). However, an DIME is not a prerequisite to the ALJ's determination of whether an authored treating physician has determined the claimant to be at MMI. Blue Mesa Forest v. Lopez, supra.
As determined by the ALJ, we have held that the status of MMI is not divisible and cannot be parceled out among the various components of a multi-faceted industrial injury. Bernard v. Current, Inc., W.C. No. 4-213-664 (October 6, 1997); Carrillo v. Farmington PM Group, W.C. No. 3-111-178 (August 26, 1997); Powell v. L D Electric, W.C. No. 4-150-716 (March 21, 1997), cf City of Colorado Springs v. Industrial Claim Appeals Office, 954 P.2d 637 (Colo.App. 1997). We adhere to our prior conclusions. We noted that MMI is defined as the point in time when:
"any medically determinable physical or mental impairment as a result of injury has become stable and when no further treatment is reasonably expected to improve the condition."
Further, MMI triggers the claimant's entitlement, if any, to permanent partial disability benefits. See Golden Animal Hospital v. Horton, 897 P.2d 833 (Colo. 1995). Permanent impairment cannot be ascertained until all compensable components of the injury have stabilized. Nunnally v. Wal-Mart Stores, Inc., 943 P.2d 26 (Colo.App. 1996). Thus, where a single industrial injury has multiple components, the claimant's permanent disability cannot be ascertained until the claimant has reached MMI for all components of the injury. Consequently, a physician has not determined MMI unless the physician opines that all compensable components of the injury are stable.
The respondents' arguments notwithstanding, the record supports the ALJ's determination that Dr. Ladwig's August 18, 1998 report was not a determination of MMI for purposes of triggering the termination of temporary disability benefits. Dr. Ladwig's brief report contains no indication Dr. Ladwig considered whether the claimant is at MMI for the CTS or psychological injuries. In fact, Dr. Ladwig did not mention any condition except the thoracic sprain. Under these circumstances, we reject the respondents' contention that they were required to "assume" Dr. Ladwig properly considered all compensable components of the industrial injury.
Furthermore, we perceive no basis to interfere with the ALJ's finding that the respondents' reliance on Dr. Ladwig's report in the unilateral termination of temporary disability benefits under Rule IX(C)(1)(a) was not predicated on a rational argument based in fact or law. After Dr. Ladwig's initial medical determination of MMI and Dr. Machanic's conflicting medical opinion, the respondents sought to overcome Dr. Machanic's opinion that the claimant's shoulder, arm, hands and psychological problems were caused by the industrial injury. Thereafter, the issue was fully litigated before ALJ Gandy at a hearing on August 4, 1997. Following that hearing the ALJ adjudicated the causation issue. Although we remanded the ALJ's determination for additional findings on the compensability of the CTS, the respondents did not appeal the ALJ's ultimate finding of a causal connection between the industrial injury and the upper extremity and psychological problems. ( See ALJ Gandy order dated July 22, 1998). Accordingly, this is not a case where the question of MMI remained a medical determination. Consequently, we reject the respondents' contention that the ALJ's order placed them in the position of "second guessing" Dr. Ladwig's opinion about the nature of the claimant's industrial injury.
In fact, the ALJ's causation determination was a final, binding determination on the compensability of the upper extremity and psychological injuries. See Cooper v. Industrial Claim Appeals Office, 998 P.2d 5 (Colo.App. No. 1999), cert. granted, 99SC865, April 24, 2000. Consequently, the respondents were collaterally estopped from challenging the ALJ's determination by relying on Dr. Ladwig's opinion that the industrial injury was limited to a thoracic spine strain. Cooper v. Industrial Claim Appeals Office, supra; M M Management Company v. Industrial Claim Appeals Office, 979 P.2d 574 (Colo.App. 1998) (collateral estoppel bars relitigation of an issue if it is identical to an issue actually and necessarily adjudicated at a prior proceeding).
Moreover, the respondents were on notice from ALJ Gandy's 1997 order that he had rejected Dr. Ladwig's opinion that the claimant's upper extremity and psychological problems were not a consequence of the industrial accident. Accordingly, the ALJ could, and did, find the respondents knew or should have known the claimant was not at MMI for the industrial injury until she was placed at MMI for the CTS and psychological injuries. Therefore, the ALJ reasonably inferred that the unilateral termination of temporary disability benefits was not predicated on a rational argument in fact or law, and this finding supports the ALJ's penalty order.
In contrast, the respondents' theory required the claimant to request and pay for a DIME to contest Dr. Ladwig's 1998 opinion that the industrial accident caused a thoracic spine injury, after she already requested and paid for a DIME to successfully prove that she suffered a multi-faceted injury. We do not believe the General Assembly intended to impose such a burden on the claimant and therefore, the respondents' analysis is not persuasive.
Finally, because Dr. Ladwig's opinion was a partial determination of MMI, we reject the respondents' contention that they were required by Rule IV(N)(5) to rely on Dr. Ladwig's opinion to admit liability for permanent partial disability benefits. The respondents did not have to unilaterally terminate temporary disability benefits to avoid penalties for the violation of Rule IV(N)(5).
The respondents' further arguments have been considered and do not alter our conclusions. Therefore, the respondents have failed to establish grounds which afford a basis to disturb the ALJ's order.
IT IS THEREFORE ORDERED that the ALJ's order dated June 26, 2000, is affirmed.
INDUSTRIAL CLAIM APPEALS PANEL
____________________________________ Kathy E. Dean
____________________________________ Bill WhitacreNOTICE
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. 2000. 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 December 22, 2000 to the following parties:
Cheryl Pilcher, 8379 Dudley Court, Arvada, CO 80005
Steve Shomaker, United Parcel Service, 5020 Ivy St., Commerce City, CO 80022
Margaret Malone, Liberty Mutual Insurance Company, P. O. Box 3539, Englewood, CO 80155-3539
Sandi Parrott, Liberty Mutual Insurance Company, P. O. Box 168208, Irving, TX 75016-8508
Jack Taussig, Esq., 1919 14th St., #805, Boulder, CO 80302 (For Claimant)
John M. Connell, Esq., 1675 Larimer St., #710, Denver, CO 80202 (For Respondents)
BY: A. Pendroy