RENDERED: JULY 8, 2011; 10:00 A.M.
TO BE PUBLISHED
Commonwealth of Kentucky
Court of Appeals
KENTUCKY RETIREMENT SYSTEMS
APPEAL FROM FRANKLIN CIRCUIT COURT
HONORABLE PHILLIP J. SHEPHERD, JUDGE
ACTION NO. 06-CI-01016
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BEFORE: VANMETER AND WINE, JUDGES; SHAKE,1 SENIOR JUDGE.
WINE, JUDGE: The Kentucky Retirement Systems (“the Retirement System”)
appeals from an opinion and order of the Franklin Circuit Court overruling the
decision of the Kentucky Retirement Systems Medical Review Board (“the
Senior Judge Ann O’Malley Shake sitting as Special Judge by assignment of the Chief Justice
pursuant to Section 110(5)(b) of the Kentucky Constitution and KRS 21.580.
Board”) and directing that benefits be awarded to the claimant and appellee herein,
Sheila Lowe (“Lowe”). Upon a review of the record, we affirm.
Lowe joined the Retirement System as a full time employee on
October 1, 1986. Lowe remained employed and in the Retirement System until
April 2, 2004, at which time she had accumulated 17.58 years of service. Lowe
was employed by the Louisville Water Company where her title was “Engineering
Clerk II.” Her duties included providing administrative support to various
programs and engineering processes for the Louisville Water Company.
The position of Engineering Clerk II was classified as a sedentary to
light-duty position. Lowe was required to sit for eight hours per day and was
required to drive to and from various agencies on an average of every other day,
which trips would usually take approximately forty minutes. Lowe was also
occasionally required to pick up gate valve books weighing up to twenty pounds.
Lowe testified that she was able to get up from her desk and move around as
needed, however. Although in the past Lowe had traveled to job sites where she
would climb into ditches or trenches, she had not done so in the two years prior to
this action. Instead, during that time period, Lowe had gone to job sites only for
the purpose of handling permits. However, toward the end of Lowe’s employment
with the Louisville Water Company, she became unable to perform the essential
duties of her position due to degeneration of the lumbar spine with spinal stenosis
and spondylosis. Reasonable accommodations were requested of the employer,
but were denied.
Lowe’s medical records show that her back problems were not a new
occurrence, but had quite a long history. Indeed, Lowe’s medical records indicate
that she first complained of back pain as early as 1992. Complaints of back pain
were again conveyed to Lowe’s family physician in 1996. By 2000, Lowe had
begun to receive treatment from spine specialists for her pain. In 2003, Lowe
underwent spinal fusion surgery for her lower back. The surgery was performed
by Drs. Raque and Dimar. In 2004, despite some evidence that the spinal surgery
was successful, Lowe continued to complain of chronic pain. Dr. Dimar indicated
that her continued pain was likely the result of epidural scarring or muscle scarring
from the surgery. He subsequently diagnosed her with “failed back syndrome.”
Lowe was started on a course of medication in an attempt to control her continuing
pain. She began receiving Social Security disability benefits in 2004.2
In 2005, after complaining to her treating physicians about the
sedative effect of the numerous medications she was prescribed, she was treated
with epidural blocks for her pain. In addition to treating with Drs. Raque and
Dimar for back pain, Lowe treated with Dr. Jeffery Berg for pain management.
Lowe has also treated with her family physician, Dr. Katherine Witherington, for
back pain and depression.
Under 105 Kentucky Administrative Regulation (“KAR”) 1:210, while an applicant for
disability retirement benefits may be allowed to introduce evidence of an award of Social
Security disability benefits, the hearing officer may not consider the award in making his
determination, but may only consider objective medical records contained within the
determination of the award.
Lowe applied for disability retirement benefits from the Retirement
System pursuant to Kentucky Revised Statute (“KRS”) 61.600, on June 30, 2004.
Under KRS 13B.090(7), Lowe bore the burden of proof in demonstrating that she
was entitled to such disability retirement benefits. Pursuant to Lowe’s application
for disability benefits, she underwent a psychological evaluation which considered,
among other things, her functional capacity. The examining psychologist
concluded that Lowe had problems with attention and concentration due to her
chronic pain and that her ability to tolerate the stress and pressure of day-to-day
employment was limited by her impairments based upon chronic pain issues. The
evaluation made no mention of any exaggeration or malingering.
Lowe’s treating physicians agree that she experiences chronic pain
and is unable to return to her former position with the Louisville Water Company.
However, the non-treating physicians employed by the Retirement System to
review Lowe’s file, Drs. McElwain, Strunk, and Ebben, all recommended denial of
Lowe’s claim. Drs. Strunk and McElwain initially claimed that it would be
premature to approve disability benefits because of the possibility of continued
improvement after her surgery. Both doctors later claimed positive findings after
the surgery, based apparently only upon radiographic evidence that the screws had
successfully fused. In addition, the Board’s reviewing doctors noted that the
psychological evaluation performed was too subjective. Dr. Strunk found fault
with the psychological evaluation because he saw “no evidence that adequate
testing for exaggeration or malingering was done.” Dr. Ebben noted that, while it
appeared Lowe may have some anxiety and depression, her results in one of the
categories may have been indicative of exaggeration. Lowe’s application for
benefits was denied based upon the recommendations of Drs. McElwain, Strunk,
Lowe requested a hearing before a hearing officer. She presented
additional evidence at the hearing in support of her application for disability
retirement benefits. The hearing officer found that Lowe met the applicable
service requirements for disability retirement under KRS 61.600 and that her
position with the Louisville Water Company fell within the definition of sedentary
to light work pursuant to KRS 61.600. The hearing officer found Lowe’s
testimony to be credible and found that the objective medical evidence supported
her claim of chronic, disabling pain in her back, neck, and shoulders. The hearing
officer found that, although radiographic evidence indicated that the fusion was
successful, Lowe consistently complained of pain and suffering after the surgery
date. The hearing officer opined that “[p]eople who are not in pain do not typically
volunteer to undergo epidurals.” The hearing officer further noted that Lowe
testified she obtained relief only by lying down for thirty minutes every two hours,
and that it was doubtful that any employer would be able to reasonably
accommodate this requirement. Thus, the hearing officer determined Lowe was
physically incapacitated from performing the duties of her previous employment
and recommended approval of her application for benefits.
The Board disagreed with the hearing officer, however, and, on
review, denied Lowe’s application for benefits. The Board found that Lowe was
not permanently functionally incapacitated from her previous job. The Board’s
order states that Lowe failed to present objective medical evidence to establish
total and permanent incapacity. Further findings included (1) that Dr. Dimar noted
Lowe appeared, radiographically, to be doing well after the surgery and that,
generally, x-rays showed that Lowe’s fusion surgery was successful and that there
was no evidence of complication, and (2) that, although Lowe had been given
restrictions of no twisting, bending, squatting, crawling, or lifting anything over ten
pounds, or sitting or standing for more than one hour, the medical evidence
reflected that these “restrictions and opinions [were] not reliable or [did] not
conflict with [her] job duties.”
The Board noted that although Dr. Raque stated Lowe would
occasionally climb down into trenches and ditches when fulfilling her duties for
the Louisville Water Company, this was not a part of Lowe’s regular job duties. It
was further noted that Lowe had only been on work sites to deliver permits in the
past few years. The Board cited no other evidence to support its findings that the
restrictions Lowe’s doctors placed upon her were “not reliable” or “did not
conflict” with her job duties as an Engineering Clerk II. In addition, the Board
made no attempt to reconcile the fact that Lowe attempted to return to work and
requested reasonable accommodation from the Louisville Water Company, which
responded to her by letter indicating that they could not provide her any reasonable
Lowe appealed the Board’s decision to the Franklin Circuit Court.
The Franklin Circuit Court agreed with Lowe and the hearing officer, reversing the
Board’s decision, stating as follows:
The Board did not reconcile either the job
description or the employer’s determination that
accommodation could not be provided with its
conclusion that Lowe was not permanently incapacitated
from doing her job. Instead the Board relied on the
opinions of its reviewing physicians, who summarily
disregarded the opinions of Lowe’s three treating
physicians. Dr. Raque’s opinion was disregarded
because the Board assumed he had incorrectly
determined that Lowe would be climbing into trenches
and ditches as part of the job. Dr. Witherington’s
opinion was disregarded because she had not conducted a
functional capacity evaluation. Dr. Dimar’s opinion
about Lowe’s job restrictions (no lifting greater than ten
pounds, no bending or twisting repetitively, need to
alternate between standing and sitting every hour, and no
stooping, climbing, lifting, or bending), was not deemed
to conflict with Lowe’s job duties.
. . . The Board has violated the plain language of the
statute by ignoring the evidence of record that Lowe was
incapacitated in the very respects identified.
The Retirement System now appeals to this Court, arguing on appeal that the
Franklin Circuit Court erroneously overturned the Board’s decision.
Upon review of the denial of an application for disability retirement
benefits, we accept the Board’s findings of fact as true as long as they are
supported by substantial evidence. Bowling v. Natural Resources and
Environmental Protection Cabinet, 891 S.W.2d 406 (Ky. App. 1994). Substantial
evidence is evidence that would “induce conviction in the minds of reasonable
men.” Kentucky State Racing Comm’n v. Fuller, 481 S.W.2d 298, 308 (Ky. 1972).
If it is determined that the Board’s findings are supported by substantial evidence,
our next task is to ask whether the agency has correctly applied the law to the facts
as found. Kentucky Unemployment Ins. Comm’n v. Landmark Cmty. Newspapers
of Kentucky, Inc., 91 S.W.3d 575, 578 (Ky. 2002). Where the finding of the Board
is against the applicant for benefits, however, we ask on review whether the
evidence in the applicant’s favor was so overwhelming as to compel a finding in
her favor. McManus v. Kentucky Ret. Sys., 124 S.W.3d 454, 458 (Ky. App. 2003).
The Retirement System argues that the Board’s decision was
supported by substantial evidence and that the Franklin Circuit Court abused its
discretion by reinterpreting the merits of the claim and by holding that the Board
did not provide adequate justification for overturning the hearing officer. We
disagree. Indeed, upon a review of the Board’s opinion, it appears the Board
misconstrued applicable statutes and erred in its interpretation of the law.
The Retirement System acknowledges in its brief that all four of
Lowe’s treating physicians found her to be disabled due to her back condition and
unable to return to her previous position. The Retirement System further
acknowledges that the psychologist responsible for evaluating Lowe’s functional
capacity also found she would be unable to return to her previous position.
Nonetheless, the Retirement System found that there was “no objective medical
evidence” that Lowe was disabled. This was clearly error.
KRS 61.600(3) requires that an application for disability retirement
benefits be supported by “objective medical evidence by licensed physicians[.]”
Under KRS 61.510(33), objective medical evidence includes, inter alia, “reports of
examinations or treatments,” or “laboratory findings” which are advanced by
medically acceptable diagnostic techniques. Id., as amended by 2011 Kentucky
Laws Ch. 52 (HB 229).
Lowe came forward with voluminous reports of examinations and
treatments from her treating physicians. The Retirement System relied upon x-rays
done after Lowe’s surgery showing that the screws had fused. The Retirement
System then concluded that this laboratory finding constituted objective medical
evidence while the various reports of examinations and treatments by Lowe’s
treating physicians did not.
The Retirement System suggests that the findings of each of Lowe’s
four physicians do not constitute “objective medical evidence” because they were
heavily based upon Lowe’s subjective complaints of pain. This argument cannot
stand. Treating physicians’ reports are clearly objective medical evidence. While
the Retirement System is at liberty to point to other objective medical evidence to
contradict the findings of treating physicians when denying a claim, and while the
Retirement System is at liberty to give greater weight to its own reviewing
physicians if it so chooses, it may not discount treating physicians’ reports as
failing the standard of objective medical evidence. Kentucky Ret. Sys. v. Bowens,
281 S.W.3d 776 (Ky. 2009). Indeed, simply because a physician’s diagnoses are
based in part upon the subjective complaints of a patient (such as pain) does not
remove them from the realm of objective medical evidence. The opinions and
conclusions of a treating physician must be considered objective medical evidence
for purposes of KRS 61.600.
Regardless, we note that it would appear by overwhelming evidence
that Lowe was disabled from her previous occupation, such fact being supported
by the unanimous opinions of four treating physicians and one psychologist. As
the Board erred as a matter of law in concluding that Lowe failed to present
“objective medical evidence” to establish her disability, we affirm the Franklin
BRIEFS FOR APPELLANT:
BRIEF FOR APPELLEE:
Robert A. Florio