KENTUCKY RETIREMENT SYSTEMS V. SANDRA BOWENS
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2007-SC-000509-DG
KENTUCKY RETIREMENT SYSTEMS
V.
ON REVIEW FROM COURT OF APPEALS
CASE NO . 2006-CA-000941-MR
FRANKLIN CIRCUIT COURT NO. 05-CI-01.140
SANDRA BOWENS
APPELLEE
OPINION OF THE COURT BY JUSTICE SCOTT
AFFIRMING IN PART AND REVERSING IN PART
Appellant, the Board of Trustees of the Kentucky Retirement Systems,
(hereinafter the "Board") appeals to this Court seeking relief from the opinion of
the Court of Appeals . Specifically, Appellant argues the Court of Appeals erred:
1) by applying the "cumulative effect" rule, as enunciated in Dillon v.
Celebrezze , 345 F .2d 753, 757 (4th Cir. 1965), and 2) in adopting the "treating
physician rule," pursuant to Houston v. Secretary of Health 8, Human Servs . ,
736 F.2d 365, 367 (6th Cir. 1984) . For the reasons discussed herein, we affirm
the opinion of the Court of Appeals on application of the "cumulative effect"
rule, but reverse its adoption of the "treating physician" rule .
Facts
Appellee, Sandra Bowens, was an employee of Johnson County Home
Health for approximately nine years, from July 1995 until she went on leave
under the Family Medical Leave Act (FMLA) in May 2004 . As a home health
aide, Appellee's duties included washing patients' hair, cooking their meals,
cleaning their home, and bathing them.
In July 1997, she was involved in a motor vehicle accident during the
course of her employment, as a result of which, she sustained a "flexionhyperextension injury" to her neck . Her head, back, and arm were also injured
in the accident. As a result of her injuries, she was reassigned to office work,
where her duties included answering the phones, making charts, completing
the mail log, ensuring maintenance of company vehicles, transporting
documents, and inputting data into the computer system.
In March 2002, she was involved in a second motor vehicle accident .
The record is unclear as to whether this accident occurred in the course of her
employment. This accident resulted in a torn medial meniscus in her right
knee, which would have required surgery to correct. Appellee did not undergo
surgery to repair her meniscus, as she was diagnosed with cancer around
January 2003 . 1 This latter diagnosis resulted in a mastectomy of her left
breast on February 7, 2003, followed by numerous radiation and
chemotherapy treatments. Incredibly, during the course of her radiation and
1 Appellant testified at her disability hearing that her employer asked her not to
have the surgery because she is the only employee who is able to obtain certain
information off the computer, and her employer did not want her to take time off
from work.
chemotherapy treatments, Appellee continued to work, often arriving before her
co-workers, leaving to take her treatments, and then returning to the office for
the rest of the day. She was unable to complete her chemotherapy, however,
because of a bad reaction to it.
There were multiple physical side-effects of the radiation and
chemotherapy . She suffered from fatigue, decreased mobility and swelling of
her arm. She suffered from cognitive difficulties and loss of memory. She was
often hoarse and coughed chronically. She also had her lymph nodes removed
and suffered from radiation burn, causing her to forego the last five treatments
of chemotherapy . Further, she suffered from arthritis in her back and her still
unrepaired torn medial meniscus . In 2004, she was diagnosed with ataxia and
asthma . She also complained of additional ailments including headaches,
dizziness, fatigue, carpal tunnel syndrome, unsteadiness, and memory
problems .
During her radiation and chemotherapy treatments, Appellee was
granted an informal work accommodation. The accommodation limited the
amount of time Appellee spent picking up documents and limited the amount
of weight she was required to lift . This accommodation ended with her
treatments .
Although she was still working at the time, Appellee applied for disability
retirement on March 21, 2003, citing arthritis, breast cancer, and the injuries
sustained from the two (2) motor vehicle accidents as the cause of her
disability . 2 She continued to work, however, until May 26, 2004 .
Her application for state benefits, however, was denied and an
administrative hearing was held on June 24, 2004 . The hearing officer
thereafter recommended that Appellee's application for retirement benefits be
denied and the Board adopted the hearing officer's Report and Recommended
Order as its final administrative decision, denying Appellee's application for
disability retirement benefits.
Appellee then filed a petition for judicial review in the Franklin Circuit
Court. That court affirmed Appellant's final administrative decision. Appellee
then filed an appeal to the Court of Appeals, which affirmed the decision of the
Franklin Circuit Court in part, and vacated and remanded in part for further
proceedings consistent with the application of the "cumulative effect" and
"treating physician" rules as aforementioned. We granted discretionary review.
Law
"In its role as the finder of fact, an administrative agency is afforded great
latitude in its evaluation of the evidence heard and the credibility of witnesses,
including its findings and conclusions of fact ." McManus v. Kentucky
Retirement Systems, 124 S.W.3d 454, 458 (Ky. App . 2003) (internal quotation
marks and citation omitted) . Thus, "[a] reviewing court is not free to substitute
its judgment for that of an agency on a factual issue unless the agency's
decision is arbitrary and capricious ." Id. at 458.
Appellee was awarded Social Security disability benefits for being totally and
permanently disabled on September 19, 2003 .
In determining whether an agency's action was arbitrary, the
reviewing court should look at three primary factors. The court
should first determine whether the agency acted within the
constraints of its statutory powers or whether it exceeded them . . .
. Second, the court should examine the agency's procedures to see
if a party to be affected by an administrative order was afforded his
procedural due process . The individual must have been given an
opportunity to be heard . Finally, the reviewing court must
determine whether the agency's action is supported by substantial
evidence . . . . If any of these three tests are failed, the reviewing
court may find that the agency's action was arbitrary.
Bowling v . Natural Resource and Environmental Protection Cabinet , 891
S.W .2d 406, 409 (Ky.App. 1994) (internal quotation marks and citation
omitted) . "`Substantial evidence' means evidence of substance and relevant
consequence having the fitness to induce conviction in the minds of reasonable
men ." Owens-Corning Fiberglass Corp. v. Golightly , 976 S.W .2d 409, 414 (Ky.
1998)(citing Kentucky State Racing Comm'n v . Fuller , 481 S.W .2d 298, 308
(Ky . 1972)) . We review an agency's conclusions of law de novo. See Aubrey v.
Office of Attorney General , 994 S .W.2d 516, 519 (Ky.App . 1998) .
Analysis
a. "Cumulative Effect" rule
Appellant argues the Court of Appeals erred in applying the "cumulative
effect" rule and determining the hearing officer erred by failing to properly
evaluate her injuries' combined effect upon Appellee . We disagree and uphold
the Court of Appeals' application of the "cumulative effect" rule in this
instance .
Appellee argued to both the Franklin Circuit Court and the Court of
Appeals that Appellant failed to consider the "cumulative effect" of all of
Appellee's medical problems in making its disability determination .3 In this
regard, the Franklin Circuit Court found that, KRS 61 .600 requires only a
finding based on the examination of the objective medical evidence . The
hearing officer's findings of fact were based on a careful examination of all of
the objective medical evidence presented. This is all that the statute requires .
The Court of Appeals, however, reached a different conclusion, relying on
Ashland Exploration, Inc . v. Tackett, 971 S .W .2d 832, 834 (Ky .App . 1998) ("We
see nothing in the amended statute which prevents the ALJ from considering
the cumulative effects of a work-related injury and an occupational disease
such that they may combine to render a claimant totally disabled.") . Noting
that, under KRS § 61 .600(5)(a)(2), Appellee's incapacity must be based on
objective medical evidence, as well as her "residual functional capacity and
physical exertion requirements," the Court of Appeals found that KRS
61 .600(5)(a)(2) evidences a legislative intent that the cumulative effect of a
disability claimant's ailments must also be considered in assessing the
claimant's eligibility for benefits . From a review of the record, the Court of
Appeals did not believe the cumulative effects were so evaluated; nor do we.
KRS 61 .600 provides, in part, that upon the examination of the objective
medical evidence by licensed physicians pursuant to KRS 61 .665, it shall be
3 The same argument was presented to the Board on exception from the hearing
officer's report and recommendation .
determined that : 1) the person, since his last day of paid employment, has
been mentally or physically incapacitated to perform the job, or jobs of like
duties, from which he received his last paid employment; 2) the incapacity is
deemed to be permanent ; and 3) the incapacity does not result directly or
indirectly from bodily injury, mental illness, disease, or condition which preexisted membership in the system or reemployment, whichever is most recent .
At issue here is whether Appellee was permanently incapacitated by her
ailments. KRS 61 .600 defines impairment as permanent "if it is expected to
result in death or can be expected to last for a continuous period of not less
than twelve (12) months from the person's last day of paid employment in a
regular full-time position." It further provides that "the determination of a
permanent incapacity shall be based on the medical evidence contained in the
member's file and the member's residual functional capacity and physical
exertion requirements ."
A disability claimant's residual functional capacity :
shall be the person's capacity for work activity on a regular and
continuing basis. The person's physical ability shall be assessed in
light of the severity of the person's physical, mental, and other
impairments . The person's ability to walk, stand, carry, push, pull,
reach, handle, and other physical functions shall be considered
with regard to physical impairments . The person's ability to
understand, remember, and carry out instructions and respond
appropriately to supervision, coworkers, and work pressures in a
work setting shall be considered with regard to mental
impairments . Other impairments, including skin impairments,
epilepsy, visual sensory impairments, postural and manipulative
limitations, and environmental restrictions, shall be considered in
conjunction with the person's physical and mental impairments to
determine residual functional capacity.
KRS 61 .600 (5)(b) .
Appellee introduced evidence that:
1) As a result of a work-related car accident in 1997, she sustained
a neck (a flexion-hyperextension) injury, back injury, pain in
her shoulder, and arthritis in her back. She further asserted
she had permanent lifting restrictions, possibly the result of the
car accident.
2) She was involved in another car accident in 2002 which resulted
in a tear in the medial meniscus of her right knee . The tear
would require surgery to correct.
3) In January 2003, she was diagnosed with breast cancer, and
she underwent a partial mastectomy of her left breast. She had
three months of chemotherapy and thirty-four radiation
treatments . She was unable to complete her chemotherapy
because she had a bad reaction to the treatments .
4) Due to her bad reaction to chemotherapy and radiation
treatments, she suffered from fatigue, burns on her skin,
difficulties with her memory, and frequent coughing . She also
had difficulty swallowing because her saliva production
decreased as a result of the radiation .
5) In 2004, she complained of additional ailments, including
headaches, dizziness, unsteadiness, and ataxia. Ataxia is
defined by the New World Dictionary of the American Language
87 (2d ed. 1978), as "difficulty coordinating voluntary bodily
movements ."
Further, Appellee testified that her primary or worst complaint was not
knowing where the cancer was at the time . She testified that her worst
physical complaint concerned her chest and her arm. She complained of
fatigue. She was taking numerous medications for her multiple ailments.
Appellee's daughter, Tonya Spradling, lived next door to Appellee and
testified at the hearing that she had to help her mother cook and clean .
Appellee's husband testified that she complained primarily of knee, back, arm,
and chest pain. He also testified that her memory had worsened . Moreover, in
February 2005, one of Appellee's treating physicians, Dr. Belhasen, submitted
a letter stating she "continue[d] to have multiple medical problems stemming
from her breast cancer and subsequent mastectomy" and "continue[d] to be
disabled ."
As a result of her various ailments, Appellee's doctors found that she was
unable to lift more than five (5) pounds; that she could not stand or walk for
more than four (4) hours total in a work day, with no more than two hours
uninterrupted; and that she could not sit for more than four (4) hours in a
work day, with no more than one hour uninterrupted . She was unable to walk
up stairs . Further, she could never climb, stoop, crouch, or kneel, and could
only balance or crawl infrequently. She was restricted from moving machinery,
among other environmental restrictions . Moreover, Appellee's ability to reach,
push, and pull were affected by her impairments . Her various ailments also
rendered her unable to type and typing was one of her primary job
responsibilities .
In reviewing the evidence, the hearing officer assessed the impact of each
of Appellee's individual ailments. Regarding her pulmonary problems, the
hearing officer concluded Appellee was not disabled because "[t]he tests closest
in time to [Appellee's] last day of paid employment revealed normal LV systolic
function, mild concentric LVH, decreased compliance, and small pericardial
effusion. A chest x-ray of May 4, 2004[,] was interpreted as showing no
convincing evidence of acute cardiopulmonary pathology."
In assessing Appellee's orthopedic problems, the hearing officer
concluded that Appellee was not disabled, although she had a torn medial
meniscus in her knee, because she had a "full range of motion with no swelling
or deformity" in that knee as of December 2002 . Appellee also had a total body
scan in April 2004 which revealed no "skeletal metastases and was noted to be
unremarkable ." Further, after chemotherapy in March 2003, Appellee attended
physical therapy for her neck and shoulder problems ; she was released from
therapy after multiple sessions "with increased range of motion ."
As to the side effects of chemotherapy, the hearing officer acknowledged
that "[i]t is understandable that [Appellee] may require a period to recover from
[such side effects], but in this case, [Appellee] continued to work in her
sedentary position even during treatment." The hearing officer noted Appellee
completed her treatment "in August 2003 and was able to continue working"
until May 2004 . Further, the hearing officer noted that "[t]here does not
appear to be a specific incident that caused [Appellee] to stop working on that
day. [Appellee's] physicians have indicated she is unable to perform her job
duties but have not submitted objective evidence to support their conclusory
statements."
Yet, Appellee introduced reports of functional capacity examinations from
two of her treating physicians, including Dr . Belhasen's 2003 medical report
submitted with Appellee's application for Social Security Disability Insurance
Benefits where she opined that Appellee was "unable to sit, stand, or walk for
long periods ;" "unable to walk up stairs;" "unable to lift more than ten pounds ;"
and "unable to type," due to her various ailments . Such evidence constitutes
"objective medical evidence ."
Nonetheless, the hearing officer found "[t]here is no evidence that
[Appellee] suffers from carpal tunnel syndrome and the most recent reports
submitted reflect [Appellee] no longer has breast cancer." He noted that
although Appellee complained of unsteadiness and memory problems, "no
objective testing [was] submitted to confirm the presence of either condition or
to what extent [Appellee is] impaired by the conditions ."
After his review of the evidence, the hearing officer concluded that
Appellee "failed to provide objective evidence of a condition that would
permanently prevent her from performing her usual work activity." He then
recommended denial of Appellee's application for disability retirement benefits.
Yet, in considering Appellee's claim for disability benefits, the hearing
officer evaluated the effect of each insular injury on Appellee's ability to
perform her job duties and determined that no one injury rose to the level of
disabling Appellee. He did not evaluate the cumulative effect of Appellee's
multiple ailments on the "whole person ." At a minimum, Appellee produced
sufficient evidence of disability due to her various ailments that she was
entitled to a determination of whether the cumulative effect of her ailments
rendered her unable to work. However, by analyzing each ailment singularly,
the hearing officer "so fragmentized [Appellee's] several ailments and the
medical opinions regarding each of them that he failed to properly evaluate
their effect in combination upon this claimant ." Dillon, 345 F .2d at 757 . The
hearing officer's review and findings regarding Appellee's injuries thus failed to
consider her multiple ailments in accordance with the "residual functional
capacity" standard in KRS 61 .600(5)(a)(2), which clearly, in instances such as
this, supports an additional "cumulative effects" analysis .
By failing to properly consider the cumulative effect standard implicit in
KRS 61 .600, Appellant exceeded the constraints of its statutory powers and
arbitrarily denied Appellee's disability claim. Bowling, 891 S .W.2d at 409 .
Given Appellee's evidence in this case, a "cumulative effects" analysis is
mandated. Accordingly, we affirm the Court of Appeals on this issue.
b. "Treating Physician" rule
Appellant next argues the Court of Appeals was erroneous in determining
that the opinions of treating physicians are entitled to more weight than the
opinions of the non-examining physicians, i.e ., the treating physician rule . For
the reasons set forth herein, we agree .
KRS 61 .600 provides that the Board must consider the objective medical
evidence provided by licensed physicians in determining disability . KRS
61 .510(33) defines objective medical evidence as :
reports of examinations or treatments; medical signs which are
anatomical, physiological, or psychological abnormalities that can
be observed; psychiatric signs which are medically demonstrable
phenomena indicating specific abnormalities of behavior, affect,
thought, memory, orientation, or contact with reality; or laboratory
findings which are anatomical, physiological, or psychological
phenomena that can be shown by medically acceptable laboratory
diagnostic techniques, including but not limited to chemical tests,
electrocardiograms, electroencephalograms, X-rays, and
psychological tests[.]
Here, the Court of Appeals adopted a new doctrine outside the statutory
scheme . In doing so, it relied upon a federal case interpreting Social Security
Administration statutes and regulations and found that the opinions of treating
physicians must be given greater weight than the opinions of non-treating
physicians, to wit :
Although there is no Kentucky case on point, in a Social Security
Disability context, the opinion of a treating physician is `given
greater weight than that of the government's physician . . . [but]
only if the treating physician's opinion is based on sufficient
medical data.' Houston v. Secretary of Health 8s Human Services ,
736 F.2d 365, 367 (6th Cir. 1984) . We find this logic persuasive,
particularly considering that the physicians on the Medical Review
Board who reviewed Appellant's application were non-examining
physicians . It appears, based on the conclusions reached by the
hearing officer, that he gave greater weight to the non-examining
physicians' opinion than to those of the treating physicians .
Therefore, adopting the logic of Houston, we find that the agency
erred when it determined that the opinions of treating physicians
are not entitled to more weight than the opinions of the nonexamining physicians serving on the Medical Review Board .
Consequently, the circuit court erred when it concluded that this
claim lacked merit.
The introduction of the "treating physician" rule into Kentucky disability
analysis is inappropriate for several reasons. Although the statute does not set
forth a standard for weighing this evidence, it is well-settled that the trier of
fact may evaluate the evidence presented and give the evidence the weight the
fact-finder deems appropriate . McManus , 124 S .W.3d at 457-458 . In Bowling,
the Court said "[tjo put it simply the trier of facts in an administrative agency
may consider all the evidence and choose the evidence that he believes." 891
S .W.2d at 410 (quoting Com. Transp. Cabinet v. Cornell, 796 S.W . 2d 591, 594
(Ky. App. 1990)) . Further, a reviewing appellate court cannot substitute its
judgment for that of the fact-finder regarding evaluations of evidence or
questions of fact. See 500 Associates, Inc v . Natural Resources and
n
Environmental Protection Cabinet, 204 S.W .3d 121, 132 (Ky .App . 2006) ;
Louisville Edible Oil Products, Inc. v. Revenue Cabinet Commonwealth of
Kentucky , 957 S .W .2d 272, 273 (Ky.App . 1997) ("The Court shall not
substitute its judgment for that of the agency as to the weight of the evidence
on questions of fact.") .
Moreover, in Houston , the Sixth Circuit was interpreting specific federal
regulations, 20 C .F.R. § 404 .1529, 20 C .F.R . § 404 .1527(4)(2), that give greater
weight to the opinion of a treating physician if that opinion is supported by
substantial evidence. See Allen v . Califano , 613 F.2d 139 (6th Cir. 1980) .
There is no analogous Kentucky statute authorizing greater weight to be given
to the opinions of the treating physician. As administrative agencies are
creatures of statute, such a rule is inappropriate . Dept. of Natural Resources
and Environmental Protection v. Stearns Coal and Lumber Co ., 563 S.W .2d
471 (Ky. 1978) . See also Black Sv Decker Disability Plan v. Nord, 538 U.S. 822,
831 (2003) ("Nothing in the Act itself . . . suggests that plan administrators
must accord special deference to the opinions of treating physicians.") .
Therefore, pursuant to KRS 13B .150(2), the Court of Appeals was
without authority to adopt and apply the treating physician rule in an
administrative hearing such as this .
Conclusion
For the foregoing reasons, we reverse the Court of Appeals on the
"treating physician rule," but affirm and remand this matter to the Board for
further review of the evidence under the "cumulative effect" standard
consistent with this opinion .
All sitting. All concur.
COUNSEL FOR APPELLANT:
Michael Todd Butler
Jennifer A . Jones
Leigh Ann Jordan
Katherine I . Rupinen
Brown J. Sharp, II
Brian C. Thomas
James Eric Wampler
Kentucky Retirement Systems
Perimeter Park West
1260 Louisville Road
Frankfort, KY 40601
COUNSEL FOR APPELLEE:
Michael S . Endicott
225 Court Street
P.O . Box 181
Paintsville, KY 41240
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