Justia.com Opinion Summary: Claimant Kevin Ressler suffered a work-related injury in 1995. He received Workers' Compensation benefits. In 2004, Claimant submitted to an independent medical evaluation (IME). The sequence of events since the IME make up the heart of this appeal. In June 2004, Claimant had surgery related with his work-related injury. In July 2004, his employer petitioned to terminate benefits as of the date of the IME. The employer also requested a supersedeas. The Workers' Compensation Judge (WCJ) denied the superseadas in August 2004. In October of that year, the insurer received the invoice for the June surgery and paid the amount by the end of January, 2005. In June 2005, the WCJ granted the employer's petition to terminate benefits. The Workers' Compensation Appeal Bard (WCAB) affirmed that decision. The insurer then requested reimbursement for the 2004 surgery from the Supersedeas Fund. The Bureau of Workers' Compensation challenged the request because Claimant's surgery predated the supersedeas request. The WCJ found that no obligation to pay arose until the bill was submitted to the insurer in October 2004. Because the obligation to pay arose after the denial of supersedeas, reimbursement was appropriate. The WCAB affirmed. The issue of whether the Supersedeas Fund may deny reimbursement of treatment rendered before the insurer requested supersedeas came before the Supreme Court. Upon review of the trial record and the Workers' Compensation Act, the Court concluded that the lower courts appropriately ordered reimbursement to the insurer for undue payments made after the supersedeas request and in direct response to the earlier denial. The Court affirmed the lower court's decision.
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[J-35-2010]
IN THE SUPREME COURT OF PENNSYLVANIA
MIDDLE DISTRICT
CASTILLE, C.J., SAYLOR, EAKIN, BAER, TODD, McCAFFERY, ORIE MELVIN, JJ.
DEPARTMENT OF LABOR & INDUSTRY, : No. 102 MAP 2009
BUREAU OF WORKERS'
:
COMPENSATION,
: Appeal from the Opinion and Order of the
: Commonwealth Court at No. 2211 CD
Appellant
: 2007, dated February 2, 2009, affirming
: the Order of the Workers' Compensation
: Appeal Board, dated November 8, 2007 at
v.
: No. A07-0684
:
: 965 A.2d 332 (Pa.Cmwlth. 2009) (en
WORKERS' COMPENSATION APPEAL : banc)
BOARD (CRAWFORD & COMPANY),
:
:
Appellees
: ARGUED: May 11, 2010
OPINION
MR. JUSTICE EAKIN
DECIDED: July 19, 2011
Claimant Kevin Ressler suffered a recognized work injury July 21, 1995, in the
nature of tendonitis of the right shoulder. A notice of compensation payable was issued,
and Mr. Ressler began receiving Workers’ Compensation benefits and coverage for his
medical bills. On March 16, 2004, Mr. Ressler submitted to an independent medical
evaluation (IME); the sequence of events thereafter is the crux of this case.
On June 1, 2004, Mr. Ressler had surgery, purportedly associated with the workrelated injury. On July 19, 2004, employer filed a petition to terminate benefits as of
March 16, the date of the IME. The employer concurrently requested supersedeas
pursuant to § 413 of the Workers’ Compensation Act, 77 P.S. §§ 1-1041.4. A Workers’
Compensation Judge (WCJ) denied the supersedeas request August 30, 2004. On
October 11, 2004, a $35,405.45 bill for the June 1 surgery was submitted to the insurer,
which paid the bill January 25, 2005. On June 28, 2005, a WCJ granted the employer’s
July 19 petition to terminate benefits.
The Workers’ Compensation Appeal Board
(WCAB) affirmed the decision.
The insurer then requested reimbursement of $35,405.45 from the Supersedeas
Fund.1 However, the Bureau of Workers’ Compensation, in its capacity as conservator
of the Fund, challenged the request because Mr. Ressler’s surgery predated the
supersedeas request.2 The WCJ found that while a service date generates the potential
for a claim, no obligation to pay arose until a bill was submitted to the insurer in
October; as the obligation to pay arose after the denial of supersedeas, reimbursement
was appropriate. The WCAB affirmed.
1
See 77 P.S. § 999(b) (“There is hereby established a special fund in the State
Treasury, separate and apart from all other public moneys or funds of this
Commonwealth, to be known as the Workmen’s Compensation Supersedeas Fund.
The purpose of this fund shall be to provide moneys for payments … to include
reimbursement to the Commonwealth for any such payments made from general
revenues. The department shall be charged with the maintenance and conservation of
this fund. The fund shall be maintained by annual assessments on insurers and selfinsurers under this act, including the State Workmen’s Insurance Fund. …”).
2
Section 443(a) provides:
If, in any case in which a supersedeas has been requested and denied
under the provisions of section 413 or section 430, payments of
compensation are made as a result thereof and upon the final outcome of
the proceedings, it is determined that such compensation was not, in fact,
payable, the insurer who has made such payments shall be reimbursed
therefor.
Id., § 999(a).
[J-35-2010] - 2
On appeal, the en banc Commonwealth Court determined:
the language of Section 443 of the Act “is clear in its focus
on payments made rather than on periods of disability” and “contains no
plain language prohibiting reimbursement of retroactive benefits.” Thus,
“the right to reimbursement relates to payments made after denial of a
supersedeas request.” Here, it does not matter that the date of service of
the medical expenses in question preceded the request for supersedeas –
what matters is that the treatment in question was later determined to be
ineligible for payment, and the bill for that treatment was submitted to and
paid for by Insurer after supersedeas was requested and denied. Thus, we
agree with the Board that Insurer is eligible for reimbursement from the
Supersedeas Fund. This outcome is clearly in line with the language of the
statute and recent case law.
Dep’t of Labor & Indus. Bureau of Workers’ Comp. v. Workers’ Comp. Appeal Bd.
(Crawford & Co.), 965 A.2d 332, 338-39 (Pa. Cmwlth. 2009) (en banc) (emphasis in
original) (citations omitted).
Judge Pellegrini, joined by Judge Friedman, dissented, opining that whether a
payment is made “as a result” of supersedeas denial is determined by whether the
insurer would have been required to pay the bill if the supersedeas had been granted.
Id., at 340 (Pellegrini, J., dissenting). He stated supersedeas only relieves the insurer of
making payments from the day of its granting and does not sanction recoupment of any
payments made prior to that date. Id., at 341. Under Judge Pellegrini’s analysis, even
if supersedeas had been granted, the insurer was still obligated to pay expenses
incurred before it filed the supersedeas request, such that the payments made could not
have been made as the result of supersedeas denial, as is required by § 443(a). Id.
We granted appeal to consider “[w]hether the Supersedeas Fund may deny
reimbursement
of
medical
treatment
rendered
before
an
insurer
requested
supersedeas, where the Workers’ Compensation Act only permits reimbursement of
amounts paid as a result of a denial of supersedeas?” Dep’t of Labor & Indus. Bureau of
[J-35-2010] - 3
Workers’ Comp. v. Workers’ Comp. Appeal Bd. (Crawford & Co.), 987 A.2d 637 (Pa.
2009) (per curiam).
The Bureau argues § 443(a)’s language pertaining to payments made “as a
result” of a denial of supersedeas does not allow the insurer to recover reimbursement
for treatment costs incurred prior to the supersedeas filing.
As the insurer did not
request supersedeas until six weeks after the surgery, the insurer could not have made
the payment as a result of denial of supersedeas as required by § 443(a). Payment, the
Bureau argues, was an obligation cemented by the failure to seek supersedeas before
the service was provided. To find as did the Commonwealth Court, it contends, may
encourage insurers to withhold payment of medical bills until after supersedeas
requests are resolved, improperly shifting medical costs to the Supersedeas Fund and
its contributing employers.
The insurer points to the plain language of § 443(a), which does not mention
medical services when referring to supersedeas timing; the statute points to “payment of
compensation” as the triggering event when evaluating an insurer’s right to
reimbursement. It contends it is sufficient under § 443(a) that Mr. Ressler’s treatment
occurred after he had fully recovered, and the relevant medical bill was submitted to and
paid by the insurer after the date supersedeas was requested and denied. Section 413
echoes this conclusion:
“A supersedeas shall serve to suspend the payment of
compensation in whole or to such extent as the facts alleged in the petition would, if
proved, require.” 77 P.S. § 774(2) (emphasis added).
The insurer discounts the Bureau’s policy arguments, pointing out the Act
requires insurers to make all payments within 30 days of receipt unless the bill itself is
disputed; thus, there is no incentive for insurers to delay payments because they will be
penalized for doing so. It further notes the Supersedeas Fund is maintained for the very
[J-35-2010] - 4
purpose embodied in this case – it is simply seeking reimbursement from the Fund to
which it contributed of the amount it paid for a bill that was ultimately determined to be
unrelated to Mr. Ressler’s work injury.
In reviewing an agency decision, our standard of review is restricted to
determining whether there has been a constitutional violation, an error of law, or a
violation of agency procedure, and whether necessary findings of fact are supported by
substantial evidence. 2 Pa.C.S. § 704; Pieper v. Ametek-Thermox Instruments Div.,
584 A.2d 301, 303 (Pa. 1990). Statutory interpretation poses a question of law; thus,
our standard of review is de novo, and our scope of review is plenary. Borough of
Heidelberg v. Workers’ Comp. Appeal Bd. (Selva), 928 A.2d 1006, 1009 (Pa. 2007).
The elements in the relatively straightforward language of § 443(a) can be
examined in order, as the facts are not in dispute. First, is this a case “in which a
supersedeas has been requested and denied”? It is – supersedeas was requested in
July, 2004, and denied August 20, 2004. Second, was the request under the provisions
of § 413 or § 430? The record shows it was under § 413.3 Third, were payments made
“as a result” of the August 20 denial? This is the contested element. The bill for the
June surgery did not arrive until six weeks after the denial of supersedeas, and as
denial meant the insurer was not relieved of the obligation to pay the bill, payment was
indeed the result of the denial. Someone owed payment on the surgical bill, but the
3
Section 413 concerns alterations to an existing compensation framework, whereas §
430 generally involves appeals from an adverse WCJ judgment. While there are
various distinctions between the two provisions, see, e.g., Mark v. Workers’ Comp.
Appeal Bd. (McCurdy), 894 A.2d 229, 236 (Pa. Cmwlth. 2006) (en banc) (discussing
treatment of both sections by Commonwealth Court), those differences are not relevant
to our current inquiry. The fact that the legislature coupled the two provisions shows §
443(a) must apply equally to each, and there is no reason to differentiate applicability of
§ 443(a) based on which of the two was involved. What is relevant is that supersedeas
was requested pursuant to one of those sections, in this case § 413.
[J-35-2010] - 5
insurer denied liability for it – payment by the insurer of the bill (pending resolution of
liability) was mandated by denial of supersedeas, not from an obligation necessitated by
the surgery itself. Lastly, was there a final determination that compensation was not in
fact payable? Yes, the WCJ ultimately granted the petition to terminate benefits as of
the March 16, 2004 IME date. Accordingly, “the insurer who has made such payments
shall be reimbursed therefor.” 77 P.S. § 999(a).
As a result of the August supersedeas denial, the insurer had no choice but to
pay the October bill, despite the fact that Mr. Ressler’s surgery corrected no workrelated injury. That ultimate obligation to pay was undetermined when the bill was due,
but the duty to pay it in the meantime fell to the insurer as supersedeas had been
denied. Ultimately, it was not an obligation of the insurer; the insurer’s payment cannot
be the result of the surgery, for in the end, it had no responsibility for that bill at all.
What the insurer did have the obligation to do was cover the bill pending the final
determination, and that obligation was the direct and singular result of the denial of
supersedeas.
To make reimbursement dependent on the date of the event giving rise to the bill
is to insert an additional element into the statute. In fact, Judge Pellegrini’s dissent is
telling.
Judge Pellegrini states “grant of supersedeas only relieves an employer of
making payments from the day it was granted; it does not authorize the recoupment of
any payments made before that date.”
Crawford & Co., at 341 (Pellegrini, J.,
dissenting) (emphasis added). The insurer is not asking for payments made before the
supersedeas filing date, much less the date of granting supersedeas – this is about a
payment made after denial, an obligation incurred when the insurer was denied
permission to suspend compensation payments.
[J-35-2010] - 6
The legislature has expressly conferred broad suspension authority on WCJs
during the litigation of termination, suspension, or modification petitions, 77 P.S.
§774(2), and we cannot find a WCJ lacks the authority to suspend insurer-provided
compensation payments relative to treatment rendered before the date of a
supersedeas request. One can fathom a host of situations where justice might require a
supersedeas relative to payment for past medical services, such as where the treatment
is unrelated to a work injury, the employer had no notice or opportunity to challenge the
treatment prior to its execution, or where the insurer has no precertification or prior
approval of the treatment. To tie the WCJ’s hands in light of the plain language of the
statute and the clear authority provided by the legislature would go against our duty to
effectuate the legislature’s intentions, 1 Pa.C.S. § 1921(a), and we decline to do so.
The insurer challenged its obligation via the supersedeas — when that was
denied, the insurer lost the right to delay payment until the issue of responsibility was
resolved.
The insurer continued meeting its responsibility until the WCJ found Mr.
Ressler was not suffering from a work-related injury at the time of the surgery. Had
supersedeas been granted, payment would not have been made, but supersedeas was
not granted and payment necessarily followed. It is the bill, post-denial, that caused
money to leave the coffers of the insurer. Ergo, payment resulted from the denial. As
the date the bill arose is irrelevant under the plain language of the statute, we find the
Commonwealth Court appropriately ordered reimbursement to the insurer for undue
payments made after request of supersedeas and in direct response to its denial.
Order affirmed; jurisdiction relinquished.
Mr. Chief Justice Castille, Messrs. Justice Saylor and Baer and Madame Justice
Orie Melvin join the opinion.
Mr. Justice McCaffery files a dissenting opinion in which Madame Justice Todd
joins.
[J-35-2010] - 7
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