Human beings may alter behavior based upon legislative and regulatory consequences. Certainly, the legislative enactment of a fine for speeding may result in slowing vehicles on roads, an intended consequence. But, there may be other instances in which legislative construction may similarly produce consequences less intended or unintended.
This year I had the opportunity to testify before the Florida House of Representatives regarding Worker's Compensation reform. An intriguing question was whether there are elements of our system which "encourage" litigation. The question, in retrospect, seemed to focus upon attorneys fees that result from litigation, but a broader answer occurred to me.
This year I had the opportunity to testify before the Florida House of Representatives regarding Worker's Compensation reform. An intriguing question was whether there are elements of our system which "encourage" litigation. The question, in retrospect, seemed to focus upon attorneys fees that result from litigation, but a broader answer occurred to me.
Generally, parties to a lawsuit, may take positions at various stages through the litigation. Having taken one position, a party may be legally prevented from later taking a contrary position. In its broadest legal description, this is known as "waiver," or "estoppel."
Florida has some waiver provisions in its Worker's Compensation law. For example, if an injured worker files a claim for compensability of a condition, and the employer carrier accepts that condition and provides Worker's Compensation benefits, that employer carrier may thereby waive the right to later deny the compensability of that condition.
Phrased differently, the employer carrier may be "estopped" from denial. Under the current law, that waiver will not apply during the first 120 days after the accident, if the employer/carrier invokes the statutory right to "pay and investigate." This is set forth in Section 440.192(8):
Within 14 days after receipt of a petition for benefits by certified mail or by approved electronic means, the carrier must either pay the requested benefits without prejudice to its right to deny within 120 days from receipt of the petition or file a response to petition with the Office of the Judges of Compensation Claims.
Another waiver provision in the statute is found in Section 440.19(4). Section 440.19(1) and (2) provide a statute of limitations for the filing of claims regarding a work injury under the Florida law. Section (4) essentially says that an employer/carrier must raise the statute of limitations defense immediately, that is in its initial response, or the defense is waived:
Notwithstanding the provisions of this section, the failure to file a petition for benefits within the periods prescribed is not a bar to the employee’s claim unless the carrier advances the defense of a statute of limitations in its initial response to the petition for benefits.
An example I used in the House was a hypothetical back injury. Imagine the injured worker has suffered a potentially surgical back condition, and is under the care of the physicians selected by the employer/ carrier. The treating physician identifies a co-morbidity of high blood pressure (HBP), and believes that the high blood pressure must be brought under control before surgical intervention for the back can be attempted. That logic may or may not be explained by the physician, she may merely prescribe the HBP medication.
Say that recommendation for HBP is either not noticed by the employer/carrier, or there is a conscious decision not to provide the treatment as it is seen as not related to the work accident (seen for whatever reason as a request to treat an unrelated condition, not as a request to control a condition to facilitate or allow treatment for the back).
Therefore, a petition is filed seeking payment for a HBP medication, of nominal value ($40.00). An adjuster might initially be inclined to provide this prescription, get the patient cleared for surgery, and move the injured worker towards recovery and return to work. That is, if all the information is known. However, doing so may render the employer/carrier liable for HBP treatment for the rest of the injured worker's life. Providing a prescription today may estop the carrier from denying that HBP care in the future. An interesting waiver trial decision is here.
If that prescription is $40.00 per month, or about $500.00 per year, and the injured worker has a 35 year life expectancy, then this expense could be as high as $17,000. Thus, the adjuster is perhaps not making a decision about a $40.00 expenditure. He/she may be making a decision that could have potentially significant future impacts, even if it's never more than medication to control blood pressure. The impact is potentially more significant if the HBP later requires more extensive care and treatment, or perhaps becomes disabling at some point in the future.
The statute of limitations decision is not significantly different in the analysis process. A call is received seeking authorization for a treating doctor to see the injured worker in follow-up, or to authorize a prescription. The adjuster may not have time at that moment to make a knowing, educated decision as to whether the statute of limitations has or has not run on the claim. But, the worker wants to be seen or to receive that medication immediately. If the adjuster authorizes care, then the case will be revived regardless of whether the statute has already run. Later, an auditor or supervisor with more free time may second guess or criticize a decision that revives an otherwise closed claim.
The injured worker may acquiesce in denial by the adjuster, and elect not to follow-up with the physician. That worker may her/himself pay the cost of ongoing medical care. Or, a petition may be filed. The response to that petition may be delayed while the statute of limitations or compensability question is answered or analyzed. At a minimum care may be delayed, or litigation instigated, or a worker pays for care that should perhaps have been provided. None are the outcome the worker wants, which is authorization for that appointment or prescription.
From the claimant's perspective, there is benefit in future certainty. As I say that out loud, there's probably benefit to any of us in future certainty of any facts in our lives. However, the "waiver" laws that provide that certainty in some instances may create a bigger situation, currently, from what might otherwise be a relatively insignificant, and easier to make, $40.00 decision.
Should the law encourage the carrier to take the chance on the $40 prescription, and expedite the injured worker care? Should the law encourage the carrier to provide the doctor visit, expedite care? If not for the waiver/estoppel provisions discussed, the potential long-term effects of today's decision, the adjuster might well simply provide that care and treatment. That care might be provided more rapidly, perhaps while the patient is in line at the pharmacy. The injured worker might benefit significantly from the ease of obtaining that care immediately, today.
Is the injured worker better off with the prescription today, which may or may not actually be related, but which will expedite the care he needs for his low back? Or, is the injured worker better off with an insurance carrier that perhaps instead sees the potentially significant downside, and is therefore perhaps encouraged to litigate or at least delay based on the potential dispute of the relatedness of the high blood pressure condition now?
Waiver may skew behavior. Under the Florida Worker's Compensation law, an employer/carrier who receives a claim for a benefit, and does not assert the statute of limitations in its initial responsive pleading, waves the statute of limitations forever. A carrier that provides care beyond the 120 days may waive ever denying that treatment, and may be liable for other treatment for that condition.
Thus, when that $40 prescription is received, an adjuster might ordinarily find it beneficial and expeditious to simply approve the prescription. However, if that action may waive the statute of limitations on a claim or render a condition compensable forever, the adjuster may be disinclined to a rapid decision, and instead undertake an investigation. If provision of the prescription today did not forever effect the statute of limitations defense, the adjuster might today be inclined to provide the $40 prescription without a great deal of present analysis or investigation.
Thus, when that $40 prescription is received, an adjuster might ordinarily find it beneficial and expeditious to simply approve the prescription. However, if that action may waive the statute of limitations on a claim or render a condition compensable forever, the adjuster may be disinclined to a rapid decision, and instead undertake an investigation. If provision of the prescription today did not forever effect the statute of limitations defense, the adjuster might today be inclined to provide the $40 prescription without a great deal of present analysis or investigation.
The waiver and estoppel provisions in the statute alter the cost/ benefit analysis that perhaps is part of every payment decision. To the extent that these waiver provisions were removed, in no way actually altering the injured worker's present position, then faster and more rational decisions based on today's expense might be made in these cases.
What the injured worker would lose with such a change would be certainty about the future. The certainty that if a carrier pays for something long enough, the worker will be entitled to it forever. The certainty that if a mistake is made after the statute of limitations has run, then the case is reopened thereby forever. These are undoubtedly beneficial to injured workers, and they preclude some volume of litigation today. But, is it possible that these provisions facilitate or even encourage other litigation today?
What the injured worker would lose with such a change would be certainty about the future. The certainty that if a carrier pays for something long enough, the worker will be entitled to it forever. The certainty that if a mistake is made after the statute of limitations has run, then the case is reopened thereby forever. These are undoubtedly beneficial to injured workers, and they preclude some volume of litigation today. But, is it possible that these provisions facilitate or even encourage other litigation today?
