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Whitfield v. Workers' Compensation Appeal Board (Tenet Health System Hahnemann LLC)

Commonwealth Court of Pennsylvania

June 6, 2018

Paulette Whitfield, Petitioner
Workers' Compensation Appeal Board (Tenet Health System Hahnemann LLC), Respondent

          Argued: March 7, 2018




         In 2015, this Court held the impairment rating evaluation (IRE) provision found in Section 306(a.2) of the Workers' Compensation Act[1] (WC Act) was an unconstitutional delegation of legislative powers "insofar as it purports to adopt a new version of the American Medical Association's [(AMA)] Guides to the Evaluation of Permanent Impairment (Guides)" without review. Protz v. Workers' Comp. Appeal Bd. (Derry Area Sch. Dist.), 124 A.3d 406, 417 (Pa. Cmwlth. 2015) (Protz I). As a result, in that case and cases that followed in which the issue was properly preserved, we vacated decisions where the change in disability status had been based on IREs performed using the Fifth or subsequent editions of the Guides and remanded the matters for evaluation using the Fourth Edition of the Guides, which was in effect when Section 306(a.2) was enacted. Subsequently, upon review, the Pennsylvania Supreme Court affirmed our holding but reversed in one important respect: it found the offending language - "the most recent edition" of the Guides - could not be severed from the WC Act and instead declared the entirety of Section 306(a.2) unconstitutional. Protz v. Workers' Comp. Appeal Bd. (Derry Area Sch. Dist.), 161 A.3d 827, 840-41 (Pa. 2017) (Protz II). In the intervening time between Protz I and Protz II, a number of claimants whose disability status had been modified based on what are now considered unconstitutional IREs, such as Paulette Whitfield (Claimant), filed petitions seeking to have their status reinstated from partial disability to total disability.[2] At issue before us is whether Claimant is entitled to the benefit of Protz II when her disability status had been modified in 2008 and she had not challenged the constitutionality of the IRE upon which the modification was based for more than seven years. Because Claimant filed her Petition to Reinstate (Petition) within three years of the date of the most recent payment of compensation, we hold she has a statutory right to seek reinstatement under Section 413(a) of the WC Act, 77 P.S. § 772. Accordingly, we vacate the Order of the Workers' Compensation Appeal Board (Board) dated May 10, 2017, which affirmed the Decision and Order of the Workers' Compensation Judge (WCJ) denying Claimant's Petition. However, because the WCJ made no determination as to whether Claimant continues to be totally disabled, which is a prerequisite for reinstatement, we must remand for further proceedings.

         I. Factual Background

         The facts of this matter are not in dispute. Claimant worked as a respiratory therapist for Tenet Health System Hahnemann LLC (Employer). On March 25, 2002, she suffered a work injury that ultimately required her to undergo lower back surgery. From March 25, 2002, until September 28, 2002, Claimant received partial disability benefits for the time in which she performed alternative work. She began receiving temporary total disability benefits beginning September 29, 2002, the day of her surgery.

         On June 13, 2006, Claimant underwent an IRE performed by Dr. Leonard Brody, using the Fifth Edition of the Guides. Dr. Brody concluded that Claimant had an impairment rating of 44 percent.[3] Based upon that IRE, a WCJ modified Claimant's disability status from total to partial disability as of the date of the IRE. The Board affirmed the modification by Order dated June 1, 2009. The parties stipulated that Claimant did not raise the constitutionality of the IRE before the original WCJ or the Board. Although Claimant's disability status was modified from total to partial, because she was not able to return to work following her surgery, Claimant received WC benefits at the total disability rate from September 29, 2002, until mid-July 2015, [4] when she received her last WC payment. Claimant testified she continued to receive medical benefits.

         On November 13, 2015, approximately one month after our decision in Protz I, Claimant filed her Petition seeking reinstatement to total disability based on that decision. Employer filed a timely Answer to the Petition on November 17, 2015, alleging reinstatement is not warranted for three reasons: (1) "Protz [I] ha[d] not been given retroactive effect"; (2) Claimant waived the constitutional issue; and (3) "[t]he law of the case doctrine prevents re-litigation of the change to partial disability status." (Answer, Reproduced Record (R.R.) at 9a.)

         At hearings on the Petition, Claimant testified that she did not feel as though she had fully recovered from her injuries and that she had been unable to work at all from the time of her surgery through July 15, 2015. There was also evidence that Claimant was involved in a motor vehicle accident in May 2012, in which she injured her head, neck, and upper back, but not her lower back. The parties stipulated many of the facts surrounding the IRE.

         Following the hearings, the WCJ issued an Order denying Claimant's Petition. After recounting our holding in Protz I, the WCJ found that Claimant was not entitled to reinstatement of her benefits based upon Protz I for a number of reasons:

a) in Protz [I], the Commonwealth Court did not expressly void all prior [IREs] or state that its decision applied retroactively; b) in Pennsylvania, generally only those matters that are pending in any phase of litigation, including appeal, or future matters are entitled to a benefit in the change of the law, and the litigation in the instant matter ended on June 1, 2009; [and] c) the constitutionality of Section 306(a.2) was not raised or preserved in the underlying litigation.

(WCJ Decision, Finding of Fact (FOF) ¶ 9, April 19, 2016, R.R. at 40a (footnote omitted).) The WCJ cited this Court's decision in Winchilla v. Workers' Compensation Appeal Board (Nexstar Broadcasting), 126 A.3d 364 (Pa. Cmwlth.), petition for allowance of appeal denied, 130 A.3d 1293 (Pa. 2015), for the proposition that Claimant waived the constitutionality argument by not raising it previously. (Id. ¶ 9 n.1.) Because of the WCJ's disposition, she did not make a finding regarding Claimant's credibility. (Id. ¶ 10.)

         Claimant appealed. In a 4-3 decision, the Board affirmed. The majority found Claimant waived the right to challenge the constitutionality of the IRE. Citing Riley v. Workers' Compensation Appeal Board (Commonwealth of Pennsylvania), 154 A.3d 396 (Pa. Cmwlth. 2016), the Board found Claimant did not challenge the constitutionality of the IRE before the WCJ or the Board when her change in status was first being litigated. (Board Opinion (Op.) at 3-4.) Furthermore, the Board noted that Claimant did not appeal the Board's June 1, 2009 order, in which the Board affirmed the original WCJ decision modifying her status to partial disability. (Id. at 3.) The Board also explained that a claimant may appeal a change in status at any time during the 500-week period of partial disability so long as the claimant presents evidence of a revised impairment rating of at least 50 percent. (Id. at 4 (citing Riley, 154 A.3d at 400 n.5).) However, the Board held that Claimant was not entitled to a modification of her disability status because she failed to present such evidence. (Id.)

         The Board dissent disagreed with the Board majority's conclusion that Claimant's change in disability status was final. The dissent distinguished Riley, noting in Riley the claimant attempted to challenge the IRE more than 500 weeks after the change in disability status, whereas Claimant here filed her petition within the 500-week period following her change in disability status.[5] (Board Dissenting Op. at 1.) Because Claimant's status was changed on June 13, 2006, and her Petition was filed on November 13, 2015, the dissent found she challenged the constitutionality within the 500-week period found in Section 306(a.2)(4); therefore, her case was not "final." (Id. at 2.)

         The dissent further found that Protz I should be applied retroactively because it satisfied the criteria for retroactive application in Blackwell v. State Ethics Commission, 589 A.2d 1094 (Pa. 1991). (Board Dissenting Op. at 2.) The first criterion is the purpose to be served by the new rule. The dissent concluded that "applying Protz [I] retroactively to the instant case serves the important purpose of mandating conformity with the constitution." (Id.) Otherwise, "[a]llowing claimants to have their disability status, and ultimately have their benefits completely cut off, based upon an IRE that was based upon an unconstitutional section of the [WC] Act greatly prejudices those claimants and blocks the main purpose of the Protz [I] decision." (Id.) With regard to the second criterion - the extent of the reliance on the old rule - the dissent noted that "the IRE process is inherently not a final process, and remains an open case for 500 weeks past the time that a claimant's disability status is changed." (Id.) Because the Guides could change and claimants retain a right to challenge their status during this 500-week period, the dissent found "employers have never had full reliance that a change in a claimant's disability status to partial will be final as that change only becomes final once the 500[-]week period has expired." (Id. at 2-3.) In terms of the final criterion, which is the effect on the administration of justice by retroactive application of the new rule, the dissent found "there would be limited effect." (Id. at 3.) The dissent believed "there would be a more adverse effect on the administration of justice if Protz [I] was not retroactively applied to [cases in which the 500-week period had not expired], as these are not final cases." (Id.) If Protz I is not given retroactive effect, the dissent stated "it would lead to the absurdity that claimants would have the right to appeal IREs, but have no actual remedy to carry through on that appeal, as the right to appeal would be based upon a now unconstitutional section of the [WC] Act." (Id.)

         Claimant petitioned for review of the Board's Order.

         II. Analysis

         On appeal, [6] Claimant argues the Protz decisions apply and she is entitled to have her disability status restored from partial to total disability because the IRE upon which the change was based was unconstitutional and invalid. Claimant contends this case is "strikingly similar" to our recent decision in Thompson v. Workers' Compensation Appeal Board (Exelon Corporation), 168 A.3d 408 (Pa. Cmwlth. 2017), in which we reversed the Board's affirmance of a WCJ's decision modifying a claimant's disability status from total to partial. (Claimant's Brief (Br.) at 8.) Claimant also argues that reinstatement petitions may be filed within three years of the date of last payment, which is satisfied here. (Id. at 9.)

         In addition, Claimant argues justice and public policy require retroactive application of Protz II. Because Protz II struck the entirety of the IRE provision from the WC Act, Claimant asserts that injured employees no longer have a statutory remedy to seek a change in status, and "by eliminating the statutory process for an employee to challenge his or her IRE-based partial disability status, the [Supreme] Court could not have intended to bind forever claimants to a partial disability status that was unconstitutionally enacted." (Id. at 13.) Moreover, Claimant emphasizes the remedial nature of the WC Act and stresses it should be liberally construed in favor of injured workers. (Id. at 14.)

         Employer argues that reinstatement is not warranted because, at the time Protz II was decided, "[C]laimant had already conclusively litigated the change in her benefit status, collected 104 weeks of temporary total disability benefits, and collected the entire[t]y of her 500 weeks of temporary partial disability benefits." (Employer's Br. at 11.) Employer contends that employers have relied on these now-invalid IREs, which largely went unchallenged until the Protz decisions. Employer explains:

[w]hile the statutory scheme set forth in Section 306(a.2) of the [WC] Act allowed a claimant to prove an entitlement to temporary total disability benefits at some point within the future of that 500 week period, presuming he/she was able to demonstrate a total person impairment of 50 [percent] or greater, the statute did not provide a claimant with 500 weeks within which to look back and invalidate a past IRE and the corresponding change in benefit status.

(Id. at 15 (emphasis in original).) Here, Employer argues that Claimant fully litigated her change in benefit status a decade ago but never challenged the constitutionality of the IRE provisions during that litigation. (Id. at 15-16, 18.) According to Employer, if the Court were to give retroactive effect to Protz II, the parties' expectation of finality would be upset. (Id. at 17.)

         A. Protz I and II

         Before we reach the merits of this appeal, it is important to understand the holdings that have gotten us to this point: Protz I and Protz II. Like this case, the facts in Protz were not in dispute. The claimant suffered a work injury in 2007. Although she returned to work for a short time, her "work injury recurred" and her benefits were reinstated. Protz I, 124 A.3d at 408. In October 2011, Claimant underwent an IRE performed by a physician using the Sixth Edition of the Guides. Based upon that IRE, the employer filed a modification petition, which the WCJ granted, converting the claimant's total disability benefits to partial disability benefits.

         The claimant appealed to the Board and asserted that Section 306(a.2) of the WC Act was an unconstitutional delegation of legislative authority in violation of the Pennsylvania Constitution.[7] Section 306(a.2) provided, in pertinent part, that a claimant's impairment rating shall be determined "pursuant to the most recent edition of the [AMA Guides]." 77 P.S. § 511.2. At the time the section was added, the Fourth Edition of the Guides was in effect. Because the impairment rating for the same injury could vary between editions of the Guides, a claimant may be determined to be more or less impaired under one edition than another edition. The claimant in Protz argued that Section 306(a.2) effectively gave the AMA, rather than the General Assembly, authority to establish the criteria under which a claimant's disability status is determined.

         On September 18, 2015, this Court rendered its decision in Protz I. We recognized that the General Assembly may delegate its legislative power but not without constraints. First, "the basic policy choices must be made by the Legislature, " and second, the "legislation must contain adequate standards which will guide and restrain the exercise of the delegated administrative functions." Protz I, 124 A.3d at 413 (quotations omitted). With those principles in mind, we held that:

the General Assembly [] failed to prescribe any intelligible standards to guide the AMA's determination regarding the methodology to be used in grading impairments. Section 306(a.2) of the [WC] Act is wholly devoid of any articulations of public policy governing the AMA in this regard and of adequate standards to guide and restrain the AMA's exercise of this delegated determination by which physicians and WCJs are bound. Indeed, Section 306(a.2) merely requires that the most recent version of the AMA Guides be used to determine a claimant's impairment rating. 77 P.S. § 511.2. Accordingly, under this basis alone, we find Section 306(a.2) of the [WC] Act unconstitutional.

Protz I, 124 A.3d at 415 (emphasis in original) (footnote omitted).

         We also held that Section 306(a.2) is devoid of any "mechanism requiring governmental review of the Guides by the promulgation of regulations." Id. We found that at the time Section 306(a.2) was enacted, the General Assembly adopted the AMA's methodology contained in the Fourth Edition of the Guides as its own. Id. at 416. Subsequent editions of the Guides, however, were not reviewed, let alone re-adopted by the General Assembly. Nor did the General Assembly delegate review of the new editions to some administrative agency. Thus, we observed that "any form of review of subsequent editions of the AMA Guides is wholly absent, leaving unchecked discretion completely in the hands of a private entity." Id. In doing so, "[t]he legislature [] simply provided a private party-the AMA-with carte blanche authority to implement its own policies and standards, proactively adopted those standards, sight unseen." Id.

         Having concluded that Section 306(a.2) was an unconstitutional delegation of legislative power because "it proactively approved versions of the AMA Guides beyond the Fourth Edition without review, " we vacated the Board's decision and remanded the matter to the Board with instruction to remand to the ...

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