Cindy Speaker: Good afternoon. My name is Cindy Speaker. I have with me today as my guest attorney Bill Kovalcik of Michael J. O’Connor and Associates. Bill is a Worker’s Compensation specialist and he’s gonna talk with us about the duration of Worker’s Compensation claims. Bill, thanks for being with us today.
Bill Kovalcik: Hi, Cindy. This topic is one that I thought would be of interest because frankly we get a lot of questions from clients, perspective clients, on this issue. One of the most frequent questions we hear is “how long can I stay on comp”. They’re expecting a simple answer. It’s not simple and sometimes they’ve heard around the factory or their workplace certain rumors about how long you can stay on, or not, and they really are confused. First of all, what I explain to them is in the beginning it’s important to know if your claim has been accepted, on what basis has it been accepted. Insurance carriers have the right to accept it on what is called a temporary notice of compensation payable, meaning that potentially that particular claim could last only 90 days. Now, if in fact they don’t stop it within the 90 days then that document converts into a permanent acceptance. Now, once you’re in the status of permanent acceptance there’s no way to know how long you’re gonna be on Comp.
Literally, every case is different. Now, there are certain things that can be done to shorten or to lengthen that period of Comp, but, again, every case is different. For instance, I think about cases I’ve handled over the years, sometimes people are on Comp for three months, six months, sometimes they’re only outta work for four weeks or something. They go back and they’re fine. I’ve had other people on Comp for 20 years. They’ll never go back to work because their disability is permanent.
Cindy Speaker: Wow.
Bill Kovalcik: Like I said, there are a number of ways to stop Comp, and I’ll get into that in a little bit more as we discuss.
Cindy Speaker: Are you saying that potentially someone could be on Worker’s Compensation indefinitely?
Bill Kovalcik: That is a potential, and there’s a couple reasons for that. Now, I’m gonna get into this later when I talk about legal updates, what’s been going on in the law in Worker’s Comp, but if an individual remains disabled theoretically he can just continue to collect Comp, but the old procedure was that after two years they could request an impairment rating evaluation, and if that individual was less than 50% disabled then the claim is capped at 500 weeks. We used to tell people that theoretically, if you really are terribly disabled, but less than 50% you’re looking at a claim of almost 12 years potentially; however, that changed when last year the Supreme Court and the Commonwealth Court of Pennsylvania both invalidated the provision off the Worker’s Comp act that provides for impairment ratings. Right now, we’re living in a world where there’s a gap, that relief is not available to insurance companies right now. I’ll talk about this later, this legislation pending to change that.
Let’s assume the IRE thing is not an issue, well there’s a number of things that insurance companies can do to stop your claim, to reduce your claim. They can have you examined by a doctor, that’s usually their first strategy. They pick a doctor. They have you examined. That doctor comes up with an opinion. Based on that opinion they can either file litigation to stop your benefits, they can engage a vocational expert to look for light-duty work for you, they can offer you light-duty work at the workplace where you got hurt. There a number of things they can do with that independent medical examination form. Those are the basic ways; however, there’s another way that sometimes we are litigating where they’re trying to stop the Comp and that is when an individual refuses treatment. Theoretically, they can file a petition to stop your benefits if you refuse treatment, if it’s reasonable and necessary treatment and it’ll make you better. We get into fights over that all the time, but it’s hard for insurance companies to win that. People usually have a good reason. If surgery is a little bit risky they can turn it down.
Certainly, most claims in this day and age, for the last 20 years or so, have ended in settlement because you didn’t use to be able to settle Worker’s Comp claims, it was against the law. We did it anyway, we got around it by entering into what was called commutations, but you could never settle the entire claim. That didn’t come about until 1996. Since then, most claims end with a settlement where the individual gets money and the claim is legally closed. That’s what usually happens now.
Cindy Speaker: Bill, if the person, suppose they’re on it for a long period of time and they retire, how does that affect the claim?
Bill Kovalcik: Well, it affects it in a number of ways because the law provides that if you get injured and you go on Worker’s Comp benefits then subsequent to that you become retirement age and you’re entitled to your regular Social Security retirement benefits then the insurance company is immediately entitled to a credit. If they’re paying you $2,000 a month that’s going to go down because one half of whatever you’re getting from the federal government in Social Security becomes a credit, so that reduces it. Same thing with pensions. Retired people start collecting their pension; if they’re collecting it from the company that is paying them the Comp, again, there’s another credit. It’s proportional to the contribution the employer made to the premium. Sometimes that’s 100%, sometimes it’s 50%, depends on the company, so they get that. They can also file a suspension petition if you retire because there is case law that stands for the proposition that when an individual takes a voluntary retirement he’s removing himself from the workplace and, therefore, he’s no longer entitled to Worker’s Comp because that’s for lost wages. The theory is you’re not losing wages if you retire.
Cindy Speaker: Yeah.
Bill Kovalcik: Anyway, as a result of these provisions of the law, and these cases, we recommend to our clients that if you’re on Worker’s Comp benefits before you consider retirement talk to your attorney about settling it. Sometimes with these larger companies we work out an early retirement package where the individual can go on either a disability pension or get his retirement early and settle his Comp. Very important to coordinate those benefits with your attorney because you can’t just go applying for stuff. Once you do that you may have injured your case. We tell people that upfront, especially older people. As they get to be closing in on 60 they need to think about it. Certainly, a lot of those people get hurt at that age it’s difficult to get back to work. The body doesn’t heal like it did when you were 20, I guess we all know that.
Cindy Speaker: That’s for sure.
Bill Kovalcik: A lot of people they think, “I might as well just retire, I was gonna work”, so we see that happen a lot.
Cindy Speaker: This is really complicated.
Bill Kovalcik: It’s very, very complicated.
Cindy Speaker: There are so many different things. I think without an attorney it would be very difficult to navigate this.
Bill Kovalcik: It’s impossible and that’s why I tell people because they think that if they get hurt everything’s fine. They’re getting paid, they don’t need an attorney. Well, you do because, like you said, it’s complicated in what your next step should be and how you should react to it. You need legal advice to decide. Since it doesn’t cost you anything, we work on a contingent fee. I work with a lot of people in the early stages of their claim and they’re not paying me because we’re not in court, so it’s free advice, free help. Everyone should have it.
Cindy Speaker: Yeah. Let me ask you one more thing before we move to the new laws and what’s going on now. What about cost of living raises, is that applicable to this topic?
Bill Kovalcik: Again, we get that question all the time because … there are things where we have to tell people, and this is one of them, that the Worker’s Comp Act isn’t necessarily fair. Here’s an example, so you get hurt in 2012 and at that point the law allows the insurance company to calculate what is called the average weekly wage. That wage is an average of what you made 12 months before the injury. That entire year before the day you get hurt is averaged. Now, that’s fixed in time. You’re gonna get more Worker’s Comp benefits the higher your average weekly wage, so if you had a good year, maybe you worked a lot of overtime great. If you didn’t, maybe you were laid off for a period of time, your number’s going to be down. That’s very important, but once you get that it’s fixed in time. These longer claims, this duration, if you talk about someone on Comp for five or seven years they’re making Comp based on wages that are now outmoded.
They’ll say to me all the time, “Well, I was talking to my buddy that just got a huge raise, do I get that”. No, you don’t get it. You’re stuck at that number. Unfair? Yeah, because if you had been working … and sometimes they’ll say, “Oh, geez, my company just got this huge project, everybody’s working 80 hours a week”. Sorry, you don’t get the benefit of that. That it is unfair.
Cindy Speaker: Yeah, it sure is. Let’s turn our attention to some of the new developments in the law, in the Worker’s Compensation law. I know you keep on top of this stuff.
Bill Kovalcik: It’s important to do so.
Cindy Speaker: Yeah.
Bill Kovalcik: The most significant area of the law that we’re watching is that impairment rating evaluation section of the act. Like I said, right now we’re in a world where there’s no such thing as an IRE anymore. It used to be that in almost every case you had if the individual was on Comp for two years you’d be faced with an impairment rating evaluation. They were very routine. Now, they’re not even scheduling them because the court has found it to be unconstitutional. To fix that unconstitutionality, the General Assembly of Pennsylvania has introduced a bill and it’s called House Bill 1840. I have a copy of it here, it’s currently in committee, the Labor and Industry Committee, so it’s still being discussed. Now, most of it is not controversial because it just fixes the problem. The problem was that the court found that the prior section of the act just said that we will be judging these injured workers’ disability based upon the American Medical Association guidelines for permanent impairment, period. Once they did that, in years past, the American Medical Association updates their guidelines every few years.
It started it was the second edition, by the time the Supreme Court ruled it was the sixth edition. What the court found is they were making decisions under a set of rules that were being determined by the American Medical Association, not the legislature. To fix that problem, this bill just says you’ll make the decision under the sixth edition, period. Now there’s no confusion. I assume that the legislature plans to just amend this law every time the American Medical Association has a new edition. That fixes that problem.
Cindy Speaker: That makes sense.
Bill Kovalcik: When I was thinking about this, I didn’t know they were gonna do it, but the insurance lobby is strong like I’ve said before and they’ve gotten to them. Envision this situation, you had a lot of people who were either on that impairment rating evaluation, which means their claim is shrinking to 500 weeks. They’re on what’s called partial disability and this case comes out invalidating the whole system. As far as we were concerned, these individuals on the 500 weeks are going back to 0, so they have to start all over again and they get another 500 weeks. That’s what we were hoping, “we” who represent injured workers; however, in this bill, they put in there a credit, so what they’re saying is once this is enacted into law if the IREs start all over and an individual had already been on partial disability for 250 weeks, he only has 250 left, even though that procedure was declared unconstitutional.
There should be a lot of fighting over this, I hope there is because I have personal experience with this. I have a client who was almost at the end of his 500 weeks and I had to tell him that come 2018, which is this year, his claim would be over. Protz case comes down, making it all unconstitutional, we file the right papers he’s back to zero. He got an extra nine years of Worker’s Comp benefits by that one decision, unless this act is passed. Now, they’re gonna get credit for the previous partial disability that was ordered. We’ll see how that goes. I guarantee you it’s gonna be litigated. We’re currently in the process of litigating this retroactive, too, because this Protz case comes out, does it only apply for cases in the future, does it apply in … there’s a lot of constitutional law on that issue.
I recently had a case where the individual was, in fact, reduced to partial and then I filed a petition to reinstate his benefits because of the Protz case. The court just recently ruled that he would be reinstated. He’s back on total disability and that partial that he had been on there’s no credit at this point. That’s being appealed, of course, I knew it would be. The appellate courts in the next year probably are gonna have to address that issue, can you do that, and we don’t know yet. I think you can, and that’s why we’re certainly filing them. That’s basically an update on that section of the law, but there are a few other things.
Cindy Speaker: I was just gonna say even someone who has a claim and they just haven’t checked in with an attorney in a while, in light of all of these changes and the complication, I think it would make sense, don’t you, that they call an attorney, see where they’re at and what’s down the road for them?
Bill Kovalcik: Yeah.
Cindy Speaker: This just looks like it’s not set and forget.
Bill Kovalcik: No, no, not at all. The law is changing all the time. In fact, there are a number of law firms after that Protz case who were advertising, specifically saying, “If you had an IRE before and you’re on 500 weeks call us, we might be able to change that”, very significant. People didn’t know that. It didn’t make the nightly news, they don’t know.
Cindy Speaker: Yeah.
Bill Kovalcik: I think there’s gonna be a lot of litigation over that in the future. There were a couple of other things I was thinking about and one of them is delay, just a general litigation delay, how long it is. When I tell my clients that something’s gonna take a year they just can’t fathom it. Often it’s because they’re waiting to get their money and I’m gonna tell them you have to wait a year. That just doesn’t work. Anyway, we have a lot of issues like that. The other issue is delay on appeal. Most recently, the appeal from the Worker’s Comp judge goes to something called the Worker’s Compensation Appeal Board. The appeal board had been running about a year, so you file the appeal you don’t get a decision for a year. Recently, it had gone up to 18 months and it’s just ridiculous. Everything’s being delayed.
The board is trying to change the rules by which they’re governed to make things quicker. They’re experimenting with video hearings so that people can get them done quicker, they don’t have to travel because the board only sits in a few places. You have to go to Pittsburgh or Harrisburg or Scranton, or Phili, and that’s it. Anyway, there’s a lot of logistics. They’re trying to change those rules. They wanna decide more cases on briefs and not even have oral argument. Those rules are all a reaction to what we in the practice see as a real slow down, impermissible delay.
Cindy Speaker: Wow, lots of changes here.
Bill Kovalcik: Yeah, there’s another thing that came to my attention in one of the newsletters that I read. There’s this whole issue in Worker’s Comp, and we’ve been confronting it for years, there’s a perception that there’s fraud in the system. Sometimes there’s a perception that fraud is on behalf of injured workers, i.e. there are people faking it, there are people working some job, and collecting. Yeah, that happens, but it’s rare. In my experience it’s rare. What isn’t rare, in my experience, is employers not having Worker’s Compensation insurance.
Cindy Speaker: Wow.
Bill Kovalcik: These are the ones that we hear about because they get prosecuted, not all of them, but some of them. I don’t know how the Attorney General determines who to prosecute, but that’s who does it, and they make a decision. They publish these. There was one in Cumberland County, one in Fayette County, one in Lackawanna County, all employers who employed someone who got hurt, but there was no insurance. That’s a terrible injustice to the client because they should be paid immediately and instead they have to go to a lawyer, who has to litigate and they’re in the hospital and … in fact, I have one tomorrow, I’m traveling to Greensburg tomorrow for the second hearing on a case where there two defendants, two employers, neither of whom had insurance.
Now, when that happens what we see is we can bring in what is called the Uninsured Employers Guarantee Fund. There’s a fund in Pennsylvania that has money, limited funds mind you, and it’s for cases where the employer had no insurance, but when we had to litigate against the fund what we find is delay, delay, delay. The fund lawyers are always telling us the money is very sparse and so our client, who is legitimately injured and probably didn’t even know that his employer didn’t have coverage, is sitting around with no income.
Cindy Speaker: That’s terrible.
Bill Kovalcik: It’s fairly common. I’ve litigated several of these over the last couple of years. They don’t all get prosecuted. Some of these employers just go away, some go out of business. Some of these marginal companies they don’t get this insurance because they’re marginal and it’s expensive. Every time I get the newsletter from the Bureau of Worker’s Comp I look to see who has been prosecuted and it’s almost always employers. Do we see an occasional claimant who was collecting and working somewhere else? Yeah, that happens and that’s insurance fraud. They get prosecuted sometimes. There are lot of employers who just fail to get this insurance.
Cindy Speaker: Yeah, that’s really bad and so unfair to the injured worker. I’m glad that they have people like you that advocate for them. Let me ask you this, Bill, if someone wants to reach your office, questions like this that they may have, what’s the best way to do that?
Bill Kovalcik: We have an 800 number. We service all of Pennsylvania, but if you wanna call us on the 800 number it’s 1-800-518-4LAW or locally it’s 570-874-3300. It’s Michael J. O’Connor and Associates. We are a statewide Worker’s Comp firm, personal injury, Social Security disability. Anything else we can refer you to an attorney who handles that, but those are our specialties.
Cindy Speaker: Excellent. Bill, thanks so much for your time today. Always a pleasure talking to you.
Bill Kovalcik: Thank you, Cindy. Nice to see you again.
Cindy Speaker: You too. Until next time, this is Cindy Speaker. Thanks for joining us everybody. Bye.
Bill Kovalcik: Bye now.