legaLKonnection Firm Newsletter – November 2017


Thank you for taking the time to read our Firm newsletter. Our newsletter provides a monthly update on recent developments within our Firm, as well as in the insurance defense community.


Please follow Lee + Kinder LLC on LinkedIn


In the News


In this season of gratitude, Lee + Kinder is deeply thankful for your confidence, loyalty and support throughout the year and want you to know that we strive to exceed your legal expectations. Our best wishes for a happy and healthy Thanksgiving Holiday.





Victory Lap

Member Karen Gail Treece defeated Claimant’s request for workers’ compensation benefits in Somers v. Costco Wholesale, W.C. No. 5-039-189-01. Claimant reported she was bending over to obtain items from the bottom of a shopping cart when she stood up and struck her head on the cart. Claimant alleged she injured her cervical spine and suffered a traumatic brain injury. Respondents denied the claim. Ms. Treece presented persuasive and credible evidence that Claimant treated for similar symptoms prior to the date of injury. Claimant also created a “Go Fund Me” page one month prior to the alleged work injury where she reported she was hospitalized for severe vertigo for a wheat allergy. Afterwards, she could not work for several months and requested money to help pay her bills. In an IME, Respondents’ medical expert opined it was not medically probable that the described incident would produce an injury. The ALJ found Claimant had a significant history of similar symptoms and that many of the medical opinions finding Claimant sustained a work injury relied on her subjective complaints. The ALJ found that although Claimant may have bumped her head, there was no objective evidence that Claimant sustained an injury and denied and dismissed the claim.


Associate Matt Boatwright successfully defended against a full contest claim for an alleged low back injury in Phanekham v. Pepsi Beverages Company, W.C. No. 4-997-901. Claimant alleged that he injured his back while reaching above his head and stocking merchandise. The ALJ found that Claimant’s testimony contradicted the testimony of Respondents’ employer witness and certain medical records. Respondents also presented evidence of a prior automobile accident, pursuant to which the ALJ found that Claimant had complaints that were similar to those he asserted were the result of the work-related event. The ALJ found that Claimant was not credible and denied and dismissed his claim for compensation.

Associate Boatwright also successfully defended against Claimant’s attempt to overcome a DIME opinion in Kumpf v. United Parcel Service, W.C. No. 5-007-544. Claimant sustained an admitted injury to his back from an automobile accident. Claimant was originally placed at MMI and discharged from care with no permanent impairment by the ATP. Respondents’ IME physician disagreed with the ATP and opined that Claimant was not at MMI, should have surgery, and had an advisory impairment of 22% of the whole person. Claimant underwent a DIME and was found to be at MMI with a 13% whole person rating and no need for further care. The ALJ found that despite Respondents’ expert’s adverse opinion, the DIME opinion was conducted thoroughly and the diagnostic examinations did not support objective evidence of the conditions for which Respondents’ expert felt Claimant needed interventional care. The ALJ therefore denied and dismissed Claimant’s request to set aside the DIME.



Changes to Rule 16 Effective January 1, 2018
Everyone’s favorite Rule is getting a makeover effective January 1, 2018. There are several minor changes to the Rule that will impact prior authorization requests and ensure that a second opinion is timely obtained by the payer. The major change that will take effect is to Rule 16-11(E) and the elimination of the option for the payer to request a hearing within the time-frames set forth in Rule 16-11(A) or 16-11(B). Click here to continue reading this article.



Cases You Should Know

Table 53 is a Real Pain for Impairment Ratings: In Rojahn v. Monaco Rehabilitation, W.C. No. 4-955-695-02 (October 5, 2017), a DIME physician assigned Claimant a scheduled impairment rating for the shoulder and a whole-person impairment for the cervical spine. The whole-person rating for the cervical spine was based only on range of motion deficits with no Table 53 diagnosis. The ALJ upheld the DIME’s impairment rating and Respondents appealed. The ICAO overturned the ALJ’s Order, concluding that the Order was not supported by the findings. The ICAO reasoned that the AMA Guides to the Evaluation of Permanent Impairment, Third Edition (Revised) specifically prohibit a rating for the cervical spine without a Table 53 diagnosis of the spine. Although there exists an exception to this rule where “severe shoulder pathology” is established and a claimant receives treatment of the cervical musculature, the ICAO noted that the statutes prohibit an impairment rating based on chronic pain “without anatomic or physiologic correlation.”

Moral of the Story: Impairment ratings for the cervical spine are not appropriate without a corresponding Table 53 diagnosis under the AMA Guides, 3rd Edition Revised.


The Road Not Taken: Unless the ALJ Determines it is Within the Commutable Labor Market: In Simms v. Shiloh Steakhouse, W.C. No. 4-892-836-01 (October 3, 2017), Claimant injured his low back after trying to pick up a full five-gallon bucket. After being placed at MMI, Claimant sought PTD benefits. The ATP and Respondents’ medical expert concurred that Claimant should alternate between standing and sitting every 30 minutes as part of his permanent restrictions. The ALJ found that there were jobs within a 40 to 60-minute drive that Claimant would be able to successfully perform, and that Claimant could make the drive to those positions. On appeal, Claimant asserted that the ALJ’s finding that he could drive 40 to 60 minutes each way was inconsistent with his restrictions requiring him to alternate between sitting and standing every 30 minutes. ICAO found that the ALJ’s finding that Claimant was capable of a 40 to 60-minute drive each way under his permanent work restrictions was supported by substantial evidence.

Moral of the Story: In determining PTD benefits, whether the labor market is commutable is a question of fact to be determined by the ALJ.


Subcontractor Liability Falls Through the Cracks: In Noyola v. Davie Roofing and Eco Roof and Solar Inc., W.C. 4-969-386-08 (September 19, 2017), Claimant was injured when he partially fell through a roof while working as an employee of a subcontractor. Claimant attempted to demonstrate that Eco Roof and Solar were his statutory employers. Eco Roof and Solar cited a certificate of insurance representing workers’ compensation coverage issued to the subcontractor as immunity to the claim. The ALJ found Claimant failed to demonstrate by a preponderance of the evidence that Eco Roof and Solar were statutory employers. Claimant appealed. Citing Buzard v. Super Wall Inc., 681 P.2d 520 (Colo. 1984) in the appeal, ICAO reasoned that in the absence of proof that the subcontractor was also an insured employer, the statutory employer remains solely liable for the work-related injuries of the subcontractor. ICAO determined Eco Roof and Solar were solely liable for Claimant’s injuries unless they could show that there was a subcontractor with workers’ compensation insurance to cover the Claimant at the time of injury, noting that the mere existence of a policy was deemed insufficient to meet this burden. ICAO remanded to the ALJ to determine whether the subcontractor had insurance to cover Claimant’s injuries.

Moral of the Story: To establish immunity, the burden remains on the statutory employer to show that the subcontractor had workers’ compensation insurance capable of covering a claimant.


Everyone is Entitled to an Opinion but…: In Oliphant v. Ward Electric, W.C. 5-006-696-03 (September 27, 2017), Claimant lost on the issue of compensability for a shoulder injury and appealed, arguing that the ALJ’s Order was not supported by substantial evidence. Claimant argued that the ALJ should have given more weight to two expert opinions that opined Claimant’s condition was an aggravation of a pre-existing condition. Citing Colorado Springs Motors, Ltd. v. Industrial Commission, 165 Colo. 504, 441 P.2d 21 (1968) in the opinion, ICAO reasoned that to the extent expert testimony is subject to conflicting interpretations, the ALJ may resolve the conflict by crediting part or none of the testimony. ICAO noted that the ALJ was more persuaded by a conflicting expert opinion that found Claimant did not sustain an acute injury. The ALJ found that the Claimant’s need for medical treatment was caused by a “temporary aggravation” of his symptoms and not a subsequent aggravation or acceleration of the preexisting condition. ICAO agreed that the medical opinion relied upon by the ALJ fully supported this determination. ICAO affirmed the ALJ’s Order.

Moral of the Story: The weight, credibility, and deference to be assigned expert testimony is a matter solely within the ALJ’s discretion, absent reversible error.


Do you have a valid FAL? Yes, if the Maximum Medical Improvement/Impairment Rating Report is Co-signed by the ATP and Benefits are Actually “Payable”: In Flake v. JE Dunn Construction, Claimant suffered work-related dehydration leading to a brief hospitalization. The physician’s assistant (PA) placed Claimant at MMI with no impairment, and the supervising physician agreed with the determination and countersigned the form WC164, agreeing with the PA. Respondents filed a FAL. Claimant requested a DIME and sought a hearing on several issues, including penalties for the improper filing of a FAL because the MMI determination was made by the PA, not the ATP. The ALJ denied the penalties, noting that countersignature of the ATP was sufficient to satisfy Rule 5-5, W.C.R.P. The ICAO agreed with the ALJ. However, the two ICAO panel members split on whether the FAL had any legal effect in light of the controversial 2014 Loofbourrow decision by the Colorado Supreme Court, which held that a MMI determination has no legal effect if indemnity benefits are not “payable” because it has not yet become a compensable claim. The two ICAO panel members in Flake split on whether such benefits are “payable” under the Loofbourrow analysis, where entitlement to indemnity benefits remains in dispute.

Moral of the Story: (1) A PA’s MMI and impairment determinations are adequate for a FAL as long as they are countersigned by the ATP; (2) The Workers’ Compensation bar and courts in Colorado are still deciding on how to interpret and apply the Loofbourrow decision summarized above. The Flake case differs from Loofbourrow because benefits were actually payable prior to the MMI determination and were ultimately ordered to be paid.

Changes to Rule 16 Effective January 1, 2018

Everyone’s favorite Rule is getting a makeover effective January 1, 2018.  There are several minor changes to the Rule that will impact prior authorization requests and ensure that a second opinion is timely obtained by the payer.  The major change that will take effect is to Rule 16-11(E) and the elimination of the option for the payer to request a hearing within the time-frames set forth in Rule 16-11(A) or 16-11(B).  The Division hopes to streamline the payer’s ability to contest prior authorization requests and ensure that a second opinion is obtained in a timely manner.  Rule 16 was previously revised and hoped to reduce overall litigation; however, the changes to the Rule contained some ambiguities and loopholes further ensuring that clarification was needed in 2018.


The current form of Rule 16-11(E) indicates:

Failure of the payer to timely comply in full with the requirements of section 16-11(A) or (B), shall be deemed authorization for payment of the requested treatment unless:


(1) A hearing is requested within the time prescribed for responding as set forth in section 16-11(A) or (B) and the requesting provider is notified accordingly.  A request for hearing shall not relieve the payer from conducting a medical review of the requested treatment, as set forth in section 16-11(B); or


(2) The payer has scheduled an independent medical examination (IME) within the time prescribed for responding as set forth in section 16-11(B).


This portion of the Rule took effect January 1, 2017 and is effective through December 31, 2017.  The Rule allows the payer to request a hearing within 7 business days of the receipt of the request for prior authorization.  However, it does not specify “when” the payer should conduct a medical records review.  It only indicates that the obligation is there for the payer to conduct one.  The Rule in subsection (2) also allows for an IME to be scheduled within 7 business days but does not delineate when the IME should take place.  For the claimant, significant delay is possible in waiting for the second opinion from the IME physician.  Theoretically, a payer could “schedule” an IME within 7 business days but have the IME take place at a much later date due to the availability of the IME physician.


The major changes that will be effective on New Year’s Day specifically indicate what a payer can due to contest a request for prior authorization, (if a medical records review is not possible), while taking into consideration the timeliness of obtaining the opinion for the claimant.


The new version of Rule 16-11(E) indicates:

Failure of the payer to timely comply in full with section 16-11(A), (B), or (C) shall be deemed authorization for payment of the requested treatment unless the payer has scheduled an independent medical examination (IME) and notified the requesting provider of the IME within the time frame prescribed for responding set forth in section 16-11(B).


(1) The IME must occur within 30 days, or upon first available appointment, of the prior authorization request, not to exceed 60 days absent an order extending the deadline.

(2) The IME physician must serve all parties concurrently with his or her report within 20 days of the IME.

(3) The insurer shall respond to the prior authorization request within five business days of the receipt of the IME report.

(4) If the injured worker does not attend or reschedules the IME, the payer may deny the prior authorization request pending completion of the IME.

(5) The IME shall comply with Rules 8-8 to 8-13 as applicable.



One aspect of the Rule that must be remembered by the carrier is the “first available appointment” portion of scheduling the IME.  As is usually the case, an IME physician will have a busy schedule and may not have an appointment within 30 days.  While an IME can still be scheduled up to the 60-day deadline with a physician of the carrier’s choice, this portion of the Rule must be complied with strictly so as to prevent delay in obtaining the second opinion for the claimant.


Another portion of the Rule that may create certain “arguments” is the duty on the IME physician and the carrier to have the report concurrently served on the parties within 20 days of the IME.  Although the Rule is silent as to what happens if the report is not concurrently served, or is late, the Rule still contains the original provision that a failure to comply is deemed authorization of the particular procedure.  The Rule appears to create an obligation on the payer to ensure that the IME physician is timely with his/her report.


Lastly, an ALJ always has the ultimate jurisdiction to determine whether a procedure is reasonable, necessary, and/or related to a claim since it will always involve a finding of fact.  However, there is also established case law indicating that a failure to timely comply with Rule 16 and/or a failure to timely authorize a recommended procedure from an authorized treating physician could be a continuing penalty situation in which an ALJ could find that the carrier acted unreasonably and that penalties should be awarded from the date of the request through the date of authorization.


It is always best to understand the particular changes to the law well in advance of when they take effect.  For any questions regarding the upcoming changes to Rule 16 and their application to a particular set of facts, please contact any of the attorneys at Lee + Kinder, LLC.


legaLKonnection Firm Newsletter – October 2017


Thank you for taking the time to read our Firm newsletter. Our newsletter provides a monthly update on recent developments within our Firm, as well as in the insurance defense community.


Please follow Lee + Kinder LLC on LinkedIn


In the News
Member Joshua D. Brown, Of Counsel John Abraham, and Office Manager Denise Iannotti attended the NAMWOLF Annual Meeting in New York City, which took place September 16 through September 20. This year’s meeting was the largest attended NAMWOLF meeting to date. NAMWOLF helps to promote diversity in the legal profession by fostering successful relationships among preeminent minority and women-owned law firms and private/public entities. The annual meeting is held every September to allow NAMWOLF member firms to provide greater insight into each Member Law Firm’s experience and capability to handle complex legal matters. The annual meeting also provides the opportunity to network with NAMWOLF Leadership, meet with prospective clients, and forward diversity among member law firms and vendors. Josh, John, and Denise represented the Firm and attended several meetings and social functions promoting the Firm’s diversity and practice areas.


Victory Lap

Of Counsel M. Frances McCracken successfully overcame the DIME physician’s opinion on permanent impairment by clear and convincing evidence in Smith v. Interactive Corp., W.C. No. 4-967-607-01. Claimant sustained an admitted injury to the left shoulder. Claimant was placed at MMI with a 5% scheduled impairment rating. Respondents filed a FAL. Claimant requested a DIME. The DIME physician agreed with the ATP’s date of MMI, but assigned Claimant a 25% scheduled impairment rating. Respondents sought to overcome the DIME. Respondents’ expert opined the DIME physician failed to review and / or account for Claimant’s pre-existing conditions/injuries to the left shoulder, did not account for the discrepancies in Claimant’s subjective complaints versus those documented in the records, and failed to provide an explanation of the 25% scheduled rating pursuant to the AMA Guidelines. The ALJ determined, by a preponderance of the evidence, that Claimant suffered a 5% scheduled impairment rating to the left shoulder. The ALJ concluded that Claimant failed to prove by a preponderance of the evidence that he was entitled to maintenance care other than as recommend by the ATP.
In a second win, Of Counsel McCracken successfully defeated Claimant’s request for appeal in Jaterka v. Johnson & Johnson, W.C. No. 4-978-459 (ICAO September 11, 2017). Claimant suffered an admitted injury to her left wrist and elbow. Claimant also complained of a left shoulder injury; however, Claimant’s ATP opined that the left shoulder injury was not work related. Claimant was placed at MMI. Respondents filed a FAL. Claimant did not object. Claimant later sought treatment with her personal physician for her left shoulder and underwent surgery. Almost one year later, Claimant filed an Application for Hearing endorsing the issues of compensability, medical benefits, petition to reopen claim, TTD, PPD, MMI and “medical reimbursement.” In the ALJ’s Order on remand, he credited the opinion of the ATP who found that Claimant’s shoulder injury was not work-related. The Claimant failed to meet her burden of proving that the treatment provided by her personal provider was authorized or related to the admitted work injury. Claimant’s Petition to Reopen was also denied as Claimant failed to present any evidence to show that the ATP erred in his diagnosis, treatment or placement of Claimant at MMI. ICAO affirmed.

Associate Matt Boatwright successfully challenged compensability of an alleged low back injury in Anstey v. United Parcel Service and Liberty Mutual Insurance. Claimant asserted that she suffered a back injury while lifting packages during the busy Christmas season. Claimant initially denied to her supervisors that her back condition was related to her work activities, instead claiming that the condition was from a prior injury at work. However, after examination by a physician, Claimant was told that her condition was not related to the prior injury. Claimant then claimed that she had aggravated her back while lifting at work. The ALJ denied and dismissed the claim for compensation finding that there was no evidence of a work-related injury.


2017 saw more legislative action related to workers’ compensation than Colorado has seen for the past few years. Three bills were introduced in the Colorado Legislature and all three passed. One of the newly enacted bills, HB 17-1229, was enacted on June 5, 2017, with an effective date of July 1, 2018 (subject to exception). It amends section 8-41-301, C.R.S., relating to the conditions of recovery for claims of mental impairment. Click here to continue reading this article.


Cases You Should Know

The ALJ Runs the Show: In Villegas v. Denver Water, W.C. 4-889-298-04 (August 22, 2017), Claimant lost on the issue of PTD benefits. Claimant appealed arguing that the ALJ erred in allowing Respondents’ expert witness to testify while denying Claimant’s request to sequester the Respondents’ expert witness, and denying Claimant’s request to call a rebuttal witness. Claimant also argued that the PTD standard was unconstitutionally vague, and that the ALJ did not have jurisdiction to hear the dispute because of the failure to set the hearing within the 180-day window. The ICAO determined it was within the ALJ’s discretion to determine which testimony to allow, and that witness preclusion is just one of several sanctions available to an ALJ for discovery violations. The ICAO refused to address the facial constitutionality of the PTD standard due to lack of authority. Finally, the ICAO upheld the ALJ’s finding that he had jurisdiction to hear the case, despite being outside 180 days from the Application for Hearing, noting that the 180-day window was “directory” rather than “jurisdictional.”
Moral of the story: Arguing every possible ground for appeal may be less persuasive than focusing on your strongest arguments.
No Back-Door Medical Treatment for Denied Claims: In Madonna v. Walmart, W.C. 4-997-641-02 (August 21, 2017), an employee suffered a heart attack at work. Claimant obtained emergency medical treatment and later sought unauthorized medical care. The matter went to hearing on the issue of compensability. The ALJ found that Claimant did not suffer a work-related injury. Nevertheless, the ALJ ordered the Respondents liable for the emergency medical treatment. The Respondents appealed. ICAO agreed that there can be no award for emergency medical treatment when the emergency treatment is not related to a work injury.
Moral of the story: The emergency medical care exception is not an exception to the rule that a claimant must prove medical care is related to a work injury.
An “Exceptional” Tale of a Compensable Injury: In Barnes v. City and County of Denver Police Department, W.C. 5-003-724-04 (August 25, 2017), a Denver Police Officer was injured when he crashed his work issued motorcycle. Respondents denied liability, claiming he was traveling from work to his home following the end of a work shift. Therefore, the injury was not compensable in accordance with the “going to and coming from” Rule. The matter went to hearing. The presiding ALJ found Claimant’s injury compensable because Claimant’s travel was “contemplated by the employment contract” and there was a substantial mutual benefit for Claimant’s use of the motorcycle after work. Respondents appealed. The Order was affirmed as to compensability.
Moral of the Story: Additional written agreements conferring a substantial benefit between employer and claimant is an exception to the “going to and coming from” Rule as it is contemplated by the employment contract.
Who Knew? Sick Leave is not “Wages:” The second issue in Barnes v. City and County of Denver Police Department involved wage continuation pursuant to C.R.S. §8-42-124(2). Claimant used sick time for the work injury. Respondents asserted Claimant was paid his full wages during this time and therefore, they did not owe temporary benefits. The ALJ ruled the Employer was required to reinstate Claimant’s sick time, and convert the wages paid to “work injury leave.” On appeal, Respondents alleged the ALJ did not have jurisdiction to order the Employer to restore Claimant’s sick leave. ICAO modified the ALJ’s Order and ruled wage continuation may not charge sick time to offset temporary benefits. Once a claimant is charged earned sick leave, the employer cannot reduce its liability for temporary disability benefits. The employer must directly compensate claimant for temporary total disability benefits for time missed.
Moral of the Story: Employers cannot take an offset against sick leave for reducing TTD payments.
Liar, Liar, Pants on Fire: Jones v. Regis Corporation, W.C. 4-976-657 (August 18, 2017), involves a contested neck injury. At hearing, Claimant admitted a prior neck injury, but testified her symptoms “completely resolved” before the work injury. An ALJ found the claim compensable. A DIME found Claimant at MMI with an impairment. Respondents later discovered numerous medical records of Claimant for extensive prior treatment to the cervical spine. This included treatment that was just two days before the alleged work injury. Respondents sought to reopen the Order on the basis of fraud/mistake and withdraw the admission. At the second hearing, the ALJ found Respondents proved, by a preponderance of the evidence, the previous Order was issued by mistake, and set aside the prior Order. Claimant appealed and argued the ALJ erred because Respondents had the burden to overcome the DIME opinion that there was a work injury by clear and convincing evidence. ICAO disagreed. It held that the initial burden is to prove, by a preponderance of the evidence, an injury occurred in the course and scope of employment. C.R.S. §§8-41-301(1)(c) and 8-43-201. In this case, Respondents had the burden to prove the injury did not occur in the course and scope of employment since they sought to modify an admission and set aside the prior Order. C.R.S. §8-41-201(1). The burden of proof remained preponderance of the evidence because it is the threshold requirement to prove before compensation is awarded.
Moral of the Story: The burden of proof of whether there is a compensable injury is preponderance of the evidence. Once an injury is admitted, then the burden of proof as to the extent of a compensable injury, as found in a DIME, is clear and convincing evidence.
On the Road Again: In Turner v. Sunrise Transport, W.C. 4-981-338 (August 23, 2017), Claimant was an over the road truck driver hired in British Columbia. His employer’s company headquarters is in British Columbia, Canada. Claimant was injured while making a delivery in Colorado and sought Colorado workers’ compensation benefits. Respondents argued Colorado lacked jurisdiction. The ALJ found only 6.2% of Claimant’s work was performed in Colorado, which was insubstantial to create jurisdiction, and dismissed the claim. Claimant appealed. ICAO noted for jurisdiction, a substantial portion of the work must be done in the state and, in addition, it must be shown there was either an injury occurring in the state or a contract of hire in the state. United States Fidelity Co. v. Industrial Commission, 61 P.2d 1033 (1936). To determine whether there is substantial portion of work performed in the state, the ALJ may consider the Claimant’s “usual” and “regular” employment. Whether Claimant proved substantial employment was a factual determination for an ALJ. ICAO affirmed the ALJ’s Order.
Moral of Story: Though an injury may occur in Colorado, the state may not be the proper place to file the claim.


Last year, the Department of Labor instituted a new overtime rule under the Fair Labor Standards Act (FLSA), which required employers to pay a little more than $47,000 annually to qualify under the white-collar exemptions.  This rule had previously been in limbo given that a Texas Federal District Court judge prevented its enforcement last Thanksgiving.  The same judge has now recently struck down the rule permanently.  Accordingly, short of a successful appeal, employers can now feel safe that the new rule will not be implemented.


The FLSA requires that employers pay non-exempt employees overtime for any hours worked beyond 40 hours in a week. An employee must satisfy three conditions to be considered exempt from overtime requirements:


  1. the employee must be paid a fixed salary;
  2. the salary must meet a minimum threshold; and
  3. the position must meet certain duties requirements applicable to executive, administrative, or professional positions.


Under the Obama administration, the DOL more than doubled the minimum salary requirement, taking it from $455 per week to $915 per week. Additionally, the threshold would have been scheduled to increase again in the year 2020 under an automatic 3-year increase the rule sought to implement.


Overview of the Recent Decision

The judge determined that the Department of Labor exceeded its authority in promulgating a new rule, with a salary requirement so high to essentially eliminate the requirement that exempt employees perform executive, administrative, or professional duties.  The judge was clear that the Department of Labor still retains the ability to issue a salary threshold test but the Department went too far.  There is no incite from the decision as to what would be a proper threshold.  The effect of this decision is that the Department’s authority to implement a salary test is now limited.


Takeaway for Employers

A sigh of relief can now be taken by all employers who did not want to see the exemption salary requirements increased.  Accordingly, employers do not have to raise salaries of exempt employees to meet the rule’s new threshold or change previously exempt employees to non-exempt status where salaries fell below the threshold.  If an employer has already adjusted its compensation scheme to comply with the new rule, it can consider whether reversing course will impact the workforce.


Please contact Lee + Kinder LLC with any questions!

legaLKonnection Firm Newsletter – April 2017


Thank you for taking the time to read our Firm newsletter. Our newsletter provides a monthly update on recent
developments within our Firm, as well as in the insurance defense community.


Please follow Lee + Kinder LLC on LinkedIn

In the News

Lee + Kinder Super Lawyers 2017


Lee + Kinder Associates

Victory Lap

JDB-news_115x125 In Dillingham v. SkyWest Airlines, Inc. and ACE American Insurance, Co., Member Joshua Brown and Associate Kelsey Bowers successfully defeated Claimant’s attempt to prove a compensable left knee injury. Claimant tried to use two theories of compensability and argued that (1) there was a specific work event that aggravated his preexisting left knee osteoarthritis and (2) he developed a cumulative trauma injury to his left knee working over a prolonged period-of-time. Dr. Paz provided convincing testimony that Claimant had preexisting, severe osteoarthritis as a result of a prior stroke. He explained that the condition was not aggravated by a specific work incident or accelerated by prolonged work activities. The ALJ found that although Claimant experienced knee pain at work, that was not enough to establish a compensable claim.


Karen-NEWSMember Karen Gail Treece defeated Claimant’s request for appeal in Newton v. True Value, W.C. No. 4-978-459 (ICAO April 4, 2017). Claimant injured his left hand at work. When Claimant reached MMI, Dr. Kawasaki assessed him with a 25% scheduled impairment, but Dr. Adams determined he had a 25% whole person impairment due to Complex Regional Pain Syndrome (CRPS). Respondents admitted to Dr. Kawasaki’s impairment rating, but mistakenly attached Dr. Adams’ report to the FAL. Claimant sought hearing and argued Respondents were required to either admit to the 25% whole person rating or request a DIME. The ALJ held Respondents were not required to admit to the whole person rating because both Dr. Adams and Dr. Kawasaki were treating physicians. Therefore, Claimant had the burden to prove he had a whole person impairment rating, which he failed to prove. Claimant appealed and argued Respondents had to admit to Dr. Adams’ rating because she was “the” authorized treating provider. The Court held that “an” ATP could determine MMI and impairment. Dr. Kawasaki and Dr. Adams were both ATPs. When an ATP assigns an impairment listed in the schedule, Respondents may either file a FAL or dispute the rating at hearing. There is no requirement for a DIME for scheduled impairments. Whether Claimant’s impairment should be considered scheduled or whole person is a question of fact for an ALJ. Claimant’s appeal was denied.

ST_newsIn Fincham v. The Home Depot, Of Counsel Sheila Toborg and Associate Stephen Abbott successfully defended on the issue of compensability. A Claimant alleged that he injured his right shoulder while unloading a refrigerator from a truck. However, the Claimant did not seek treatment until several months after the alleged incident. Furthermore, the Claimant exhibited numerous degenerative changes in his shoulder consistent with his active lifestyle of playing softball and golf. Respondent argued that these factors made it unlikely that Claimant’s shoulder condition was related to the alleged incident. The ALJ agreed and denied compensability.


FMCnews_115x125Of Counsel Frank Cavanaugh successfully argued that apportionment was appropriate and could be determined at hearing without first securing a DIME. Franklin v. Pueblo City Schools. W.C. No. 4-988-862. Claimant suffered a work injury to his low back and was placed at MMI with a 15% whole person impairment. Claimant had a prior low back injury from 1998 with a 5% whole person impairment rating; however, the medical records for this prior injury had been destroyed. At hearing, Claimant challenged the apportionment noted in the FAL and argued that apportionment cannot apply without medical documentation. The Administrative Law Judge agreed with Respondents that apportionment was appropriate and that the issue can be decided at hearing without first securing a DIME.


FranNewsOf Counsel M. Frances McCracken successfully defended against Claimant’s claim for a low back injury in Madonna v. Walmart Stores, Inc and New Hampshire Insurance Co., W.C. 4-997-641. Claimant had a lengthy history of intermittent neck pain, cervical surgeries, paralysis resulting from a surgery, and coronary artery disease. Claimant suffered an alleged injury while at work and underwent extensive medical treatment for neck pain. At no point did Claimant treat for back pain. At hearing, Claimant for the first time alleged that he injured his back, not his neck. Dr. Reiss provided convincing testimony that Claimant’s symptoms and need for treatment were likely more related to his preexisting conditions. The ALJ agreed with Respondents that Claimant failed to provide sufficient evidence to establish that he suffered an industrial injury.


jmanewsIn Tortorella v. Mariner Healthcare Inc., Of Counsel John Abraham successfully withdrew Respondents’ Final Admission of Liability that authorized reasonable, necessary and related medical maintenance benefits. Claimant sustained an admitted injury to her lumbar spine on April 18, 2005. Claimant underwent conservative medical care and reached MMI on March 7, 2007. Respondents filed a FAL on February 8, 2015, admitting for maintenance medical benefits. Claimant received maintenance care from her treating physicians since 2008. Mr. Abraham produced an IME report from Dr. Fall which persuasively maintained that there was no objective medical evidence that Claimant exhibited any functional gains as a result of her extensive maintenance care. Dr. Fall persuasively opined that Claimant no longer required medical maintenance care. Mr. Abraham also entered into evidence surveillance which documented Claimant functioning beyond her stated level of limitations. The ALJ found the surveillance video and Dr. Fall’s opinions credible and persuasive. The ALJ ordered that Respondents were permitted to withdraw their February 8, 2008 FAL and the admission of reasonable, necessary and related medical maintenance benefits.


SJA-news_115x125In McClelland v. The Home Depot, Associate Stephen Abbott successfully defended against a claim for disfigurement based on waiver. Claimant underwent surgery and reached MMI. The claim was closed on a FAL without a disfigurement award. Claimant subsequently reopened the claim for additional surgery and then sought a disfigurement award for his surgical scarring from the first surgery. Mr. Abbott persuasively argued that Claimant had waived his right to a disfigurement award for the first surgery by failing to object to the FAL. Further, reopening the claim did not reopen the issue of any disfigurement existing at the time of the FAL. The ALJ agreed and denied Claimant’s claim for disfigurement benefits as to the first surgery.


Cases You Should Know

If you think insurance is expensive, try being uninsured: In Dami Hospitality, LLC v. ICAO, the Colorado Court of Appeals held that imposing a fine of over $840,000 on a smaller employer for failure to maintain WC insurance was excessive and the Court should have considered other factors. (February 23, 2017, Colo. Ct. Appeals). While the employer failed to maintain insurance on two occasions, it argued that the high penalty was unreasonable because it was grossly disproportionate to its ability to pay and the harm caused by the lack of insurance. The Court of Appeals concluded that the 8th Amendment’s protection against excessive fines applies to natural persons as well as corporations. As such, it set aside the Director’s Order and instructed the lower court to consider additional facts that were relevant to the employer’s specific circumstances. These facts included 1) the employer’s ignorance that the required WC insurance had lapsed, 2) the failure of the Division to notify the employer of the lapse for almost five years, 3) the employer’s ability to pay the fine, and 4) the actual or potential harm to employees for the failure to maintain insurance.

Moral of the Story: Corporations are entitled to 8th Amendment protections against excessive fines, so the Director or ALJ must consider facts that are relevant to the employer’s specific circumstances, such as ability to pay, before issuing a penalty for failure to maintain WC insurance.

Finality is not the language of politics: In Evergreen Caissons, Inc. v. ICAO and Jennifer Munoz Botello, the Colorado Court of Appeals held the ALJ’s and ICAO’s separate Orders were not final for purposes of review. Decedent died as a result of his industrial injuries. The employer admitted death benefits for the Decedent’s minor children, but contested whether Claimant Jennifer Munoz Botello was a surviving spouse for purposes of entitlement to death benefits. The hearing ALJ held that Ms. Botello was a surviving spouse, and directed the parties to set a hearing to determine the remaining issues. The employer petitioned the Industrial Claim Appeals Office (ICAO) to review the ALJ’s Order. ICAO dismissed the petition without prejudice, finding that the hearing issues were limited to whether Ms. Botello was a dependent, as well as the allocation of benefits amongst the dependents. Thus, ICAO concluded that the ALJ’s Order did not award death benefits to Claimant Botello and was therefore not final and could not be appealed. The Court of Appeals agreed with ICAO, citing that for an order to be final and subject to appeal, it must grant or deny benefits or penalties. Furthermore, the Court held the ALJ must determine the amount before the ruling is “final” for purposes of review. As such, the Court of Appeals noted that the ALJ did not award death benefits, but merely determined whether or not Ms. Botello was a dependent. Therefore, the Court of Appeals denied the employer’s appeal.

Moral of the story: For an order to be final, it must grant or deny benefits or penalties. Furthermore, an order must determine the amount of benefits and/or penalties before it is final for purposes of review.

Keep Calm and Carry (Complete) Insurance: In City of Lakewood v. Safety National Casualty., the Colorado Court of Appeals affirmed the summary judgment in favor of the insurance company, denying indemnification for the City’s defense costs. A City police officer was killed by friendly fire, and his widow alleged that the City and its officers violated the Decedent’s Federal Constitutional rights under 42 U.S.C. § 1983. The City sought indemnification for its defense costs, as well as the costs incurred by the officers named in the lawsuit, but the insurance company denied coverage. The District Court concluded that a § 1983 claim does not arise under an employer liability law and granted the insurance company’s motion for summary judgment. On appeal, the Court of Appeals held that § 1983 is not a workers’ injury statute that displaces common law claims with a new cause of action. Nor can § 1983 be classified as a common law claim as it is a Federal Constitutional claim. Had the insurance company intended to cover claims arising out of federal law, it is likely that it would have cited to federal references, which was not the case in this matter. As such, the Court of Appeals held that the City’s defense costs, which were sustained because of liability imposed a result of the widow’s § 1983 claim, did not arise from a state workers’ compensation or employer’s liability law and were, therefore, not covered by the insurance company’s policy.

Additionally, the police officers’ claims for indemnification were also dismissed after the Court of Appeals held that the City’s indemnification payments to the officers named in the lawsuit were not classified as “losses” – actual payments, less recoveries, legally made by the employer to the employees and their dependents. The Court of Appeals also held that the term “employee” refers to an injured employee, not to an employee potentially responsible for the injury, such as the named officers. Furthermore, the Court of Appeals was unwilling to contradict the clear intention of the insurance company’s policy to cover only workers’ injury claims. Therefore, the City was not entitled to reimbursement from the insurance company for the incurred costs of the named officers.

Moral of the story: Unless specifically addressed in a policy, the Federal Constitutional right under § 1983 does not mandate insurance companies to indemnify payments to named parties arising from the applicable insurance companies’ policies aimed at covering injured workers.

Want to scare the neighbors? Name your wifi “FBI Surveillance Van”: In Ross v. St. Thomas More Hospital, W.C. 4-985-129 (February 16, 2017), Claimant sought review of an ALJ’s Order denying and dismissing her claim for additional medical benefits. The ALJ reviewed a surveillance video and specifically found that Claimant’s testimony regarding her pain level and functional abilities were out of proportion to the objective findings on the surveillance. The ALJ also credited Respondents expert’s testimony over Claimant’s treating physician. On appeal, Claimant argued that the ALJ erred in admitting the surveillance tapes. Claimant argued that the surveillance was only provided to her 10 days prior to hearing in violation of W.C.R.P. Rule 9-1(E). ICAO explained that the ALJ did not abuse his discretion in allowing the surveillance tapes into evidence. ICAO determined that the proper relief under Rule 9-1(E) was for the Court to entertain a continuance, which Claimant specifically declined. ICAO determined that the ALJ’s decision was supported by substantial evidence and the ALJ’s Order was affirmed.

Moral of the story: An ALJ’s decisions on evidentiary rulings will not be disturbed without a showing of an abuse of discretion leading to a reversible error.

De minimus non curat lex (“the law does not concern itself with trifles”): In Arnhold v. United Parcel Service, W.C. 4-979-208-02 (February 24, 2017), Claimant sought review of an Order denying the Claimant’s request for penalties to be assessed against the Respondent insurance carrier. At hearing, Claimant sought a 10-day penalty for late payment of TTD benefits. The adjuster testified that she was attempting to verify the amount owed before sending a check to Claimant two days after the due date. The ALJ determined that there was no credible or objective evidence that Respondents knew that they were in violation of the Order. On appeal, ICAO reversed and remanded. ICAO held that the testimony confirmed that the check was mailed two days after the deadline, thus supporting a penalties award. Nevertheless, ICAO took note of the lack of objective evidence put forward by Claimant and opined that more than a de minimis penalty was not justified. ICAO remanded the claim back to the ALJ to determine the amount to be awarded for a 2-day penalty.

Moral of the story: Ensure that all monies agreed to are issued in a timely fashion.



There has been growing governmental concern in the State of Colorado over uninsured employers. Changes to the Workers’ Compensation Act in 2005 created stiffer fines for employers who fail to comply with mandated coverage for workers’ compensation benefits. The Division of Workers’ Compensation Director is required to impose a fine of $250 per day for an initial offense. The 2005 changes to Colo. Rev. Stat. § 8-43-409 included an increased fine range for companies that were non-compliant for a second time. Those companies now face up to a $500 per day fine. This statute specifically states that the ‘fine’ levied under the statute shall be the ‘penalty’ within the meaning of Colo. Rev. Stat. § 8-43-304, but is in addition to the increase in benefits owed under Colo. Rev. Stat. § 8-43-408.

Colo. Rev. Stat. § 8-43-409 governs the procedures for non-compliant employers. First, the Director is empowered to investigate and notify the non-compliant employer of their right to request a prehearing conference over the coverage issue. Second, if the Director determines that the employer is non-compliant, then the Director must take at least one of the following actions: (1) order the non-compliant employer to cease and desist its business operations while it is non-compliant; and/or (2) assess fines. After a cease and desist order is entered, the Attorney General immediately starts proceedings against the non-compliant employer to stop doing business. Further imposition of any fine under this statute, after appeal time frames have run, can be lodged with the District Court as a judgment. 25% of any fine collected would be directed to the workers’ compensation cash fund under Colo. Rev. Stat. § 8-44-112, with the balance going to the state general fund. Finally, any fine under the statute is in addition to the increased benefits owed by the non-compliant employer under the preceding statute, Colo. Rev. Stat. § 8-43-408. This statute increases ordinary benefit exposure by 50% for non-compliant employers and puts in place a bonding requirement for the non-compliant employer.



Significant fines handed down to non-compliant employers have received press attention in the past. As reported in the Denver Post on August 29, 2016, a student run café at the University of Colorado was shut down after it was fined more than $224,000 for not having workers’ compensation coverage. The Complete Colorado, a blog run by local political commenter Todd Shepard, documented a $271,000 fine against a Longmont garden business for failing to comply with coverage requirements, as well as a $516,700 fine levied against fast food restaurant, El Trompito Taqueria. These fine amounts increased quickly as the result of the daily multiplier. The time frames of noncompliance were largely assumed by the Director because the employer could not prove coverage during these intervals. For a small employer to receive such a large fine can effectively put the employer out of business, leaving the injured worker with no practical recourse for benefits.

There are mitigating circumstances that may reduce fines levied against non-compliant employers. For instance, if the employer can show compliance once it has become aware of a lapse in coverage, this will mitigate the fine amount. A non-compliant employer paying benefits, essentially stepping into the shoes of a would-be insurer, also helps mitigate the fine.

The Director is obligated to try to ensure compliance while not effectively forcing employers out of business. This should be done with an eye toward trying to keep injured employees from having no benefit flow or treatment. When an injured worker has no coverage, it forces the injured worker to seek medical treatment through personal healthcare insurance or, or if no health care coverage exists, through self-pay methods, emergency room visits, treatment write-offs and/or charity. Many healthcare insurers reject coverage for treatment of a work injury since that liability should fall on a workers’ compensation carrier or employer. Further losses from unpaid and unreimbursed medical treatment through emergency rooms, write-offs or charity are ultimately passed on to employers and employees at large, who bear the burden of increasing insurance premiums as the result of uninsured employers and their injured employees.



Proposed House Bill 17-1119 attempts to address payment for injured workers who do not have coverage through their non-compliant employer. HB 17-1119 is currently a proposed Bill, but is likely to be approved later this year. The Bill was introduced on January 20, 2017, and must still pass the State House and Senate, as well as be signed into law by the Governor.

Coverage:  The fund would cover claims occurring on or after January 1, 2019 that have been adjudicated compensable, where the employer has been determined uninsured and has failed to pay the full amount of benefits ordered. The fund does not cover a partner in a partnership or owner of a sole proprietorship, the director or officer of a corporation, a member of an LLC, the person who is responsible for obtaining workers’ compensation coverage and failed to do so, someone who is eligible for coverage but elected to opt out, or anyone who is not an “employee” under the terms of the Act.

Funding:  The fund is made up of the fines and other revenue collected by the Division that is specifically allocated to the fund, along with any gifts, grants, donations or appropriations. There is also a separate 25% paid to the fund based on benefit amounts owed by non-compliant employers.

Governance:  The fund is run by a board that includes the Director and four individuals representing each of the following: employers, labor organizations, insurers and a claimant attorney.  The board serves for a term of 3 years and may be reappointed with the exception of the initial board members. With regards to the initial board, one member shall serve for an initial term of three years, two members for a two-year term and one member for a one year term.  No one can serve more than three consecutive terms.  Benefits are to be paid at the ordinary rates. If the fund does not have enough money in the fund, the board can reduce the rates.  The board is unpaid.

Powers:  The fund has ordinary powers attendant to handling workers’ compensation claims.  Of interest, the fund has the power to intervene as a party in a case involving an uninsured employer, or other potentially responsible entity. Upon acceptance of the claim into the fund, a lien is created against any assets of the employer and its principles for the amount due as compensation. This lien has priority over all other liens except delinquent tax payment liens.  The lien can be perfected by filing in the appropriate court. Further, the fund becomes something akin to a secured creditor of any insolvent employer for amounts the fund determines may be needed to pay uninsured losses. Payment by the fund does not relieve the uninsured employer of payment obligations for benefits and the fund has the power to pursue any employer who defaults on those payments in District Court.



The proposed legislation creates a small safety net for injured workers of uninsured employers.  Given the ever-increasing costs of medical care, there is a valid question as to whether funding would be adequate to cover workers’ compensation benefits claimed by the injured workers.  Further, it will be interesting to see if respondents may be required to give notice to the fund in cases where liability is being adjudicated on a statutory employer issue. The fund may have a recognizable interest in such litigation, as the burden of paying workers’ compensation benefits would fall on the fund should there be a determination of no coverage. It is not unusual for a carrier or employer to settle potential statutory employer liability on a “denied” basis as opposed to proceeding to litigation, where adjudication might make statutory employer liability clear. The fund intervening in this type of case may prevent pre-adjudication settlement from occurring without some consideration being paid to the fund in the “denied” settlement as well.

Division Proposed Changes to W.C.R.P. Rule 17 Exhibit 5 – Cumulative Trauma Disorders

W.C.R.P. Rule 17 contains the Medical Treatment Guidelines promulgated by the Division of Workers’ Compensation. Several corresponding exhibits discuss the applicable medical criteria regarding injuries to different body parts and recommended treatment. Exhibit 5 addresses cumulative trauma disorders and the causation matrices involved in guiding physicians to assess whether an occupational disease may be work related. The Division has proposed updates to the matrices to specifically address certain scenarios facing injured workers and the applicable statutes under the Workers’ Compensation Act. Also, there have been additional journals, studies, and treatises better addressing the anatomy behind some of the cumulative trauma disorders and causation. The following will help outline some of the updates to the Guidelines proposed by the Division.


The current version of the cumulative trauma Medical Treatment Guidelines were revised on September 16, 2010 and became effective on October 30, 2010. These Guidelines helped provide a framework to better address causation and clarified primary and secondary risk factors associated with some of the disorders. Physicians could now have a somewhat clear roadmap to address primary and secondary work factors in the workplace and narrow down whether an injured workers’ alleged condition was causally related to their job duties. Among the issues that were clarified were tasks such as keyboarding, mousing, the use of hand tools, and the repetitive task cycles and durations of each of activities in which an injured worker may be exposed to in the workplace.


When assessing causation, the Division’s Guidelines indicate the following:

Cumulative trauma related conditions (CTC) of the upper extremity comprise a heterogeneous group of diagnoses which include numerous specific clinical entities including disorders of the muscles, tendons and tendon sheaths, nerves, joints and neurovascular structures. The terms “cumulative trauma disorder”, “repetitive motion syndrome”, “repetitive strain injury”, “myofascial pain” and other similar nomenclatures are umbrella terms that are not acceptable, specific diagnoses. The health care provider must provide specific diagnoses in order to appropriately educate, evaluate, and treat the patient. Examples include: de Quervain’s disease, cubital tunnel syndrome, and lateral/medial epicondylitis (epicondylalgia).

Many patients present with more than one diagnosis, which requires a thorough upper extremity and cervical evaluation by the health care provider. Furthermore, there must be a causal relationship between work activities and the diagnosis (See, Section D.3 Initial Diagnostic Procedures, Medical Causation Assessment). The mere presence of a diagnosis that may be associated with cumulative trauma does not presume work-relatedness unless the appropriate work exposure is present. Mechanisms of injury for the development of cumulative trauma related conditions have been controversial. However, repetitive awkward posture, force, vibration, cold exposure, and combinations thereof are generally accepted as occupational risk factors for the development of cumulative trauma related conditions. Evaluation of cumulative trauma related conditions require an integrated approach that may include ergonomics assessment, clinical assessment, past medical history and psychosocial evaluation on a case-by-case basis.

The normal working age population may often have non-specific pain complaints that require minimum treatment and may be considered part of the normal aging process. When pain continues or a complete history indicates a potential for other diagnoses, a medical workup may be necessary to screen for other diseases. However, in cases where there is no specific diagnosis and corresponding work related etiology, the work-up should generally be performed outside of the workers’ compensation system.

When applying the algorithm in Exhibit 5, the first step requires the physician to establish the diagnosis for the patient. Once completed, the second step requires the assessing physician to obtain the injured workers’ job duties and clearly define the specific tasks involved. The physician may require a jobsite evaluation to determine each task. The third step focusses on each specific job duty and whether it classifies as a primary or secondary risk factor. Primary and secondary risk factors both involve measuring force and repetition over different periods of time.


Currently, if neither a primary or secondary risk factor are present in the job duties of the injured worker, the condition is presumed to not be work related. If there are one or more identifiable primary risk factors, and the risk factor is physiologically related to the diagnosis, then the condition may be work related. If the primary risk factor is not physiologically related with no secondary risk factors, then again the condition is likely not work related. Once a physician arrives at identifying secondary risk factors, the fourth step in the algorithm goes a bit further and requires the physician to identify diagnostic-based risk factor tables to narrow down causation. There are several non-work related factors in assessing causation, such as the patients’ age, gender, whether the patient uses tobacco products, etc., that help in determining a non-work related cause.


Most of the algorithm and causation criteria remain unchanged in the Division’s latest proposals. Only certain portions have been revised to take into consideration particular nuances in the primary and secondary risk factors. One of the proposed changes to the Guidelines indicates that in the case of an aggravation or exacerbation of a pre-existing condition, the physician will now need to make an individualized causation decision based on the presence of other accompanying conditions. The physician must take each patient on a case by case basis.


Another proposed change is the increased amount of force but reduced task cycles and durations as primary risk factors. Force and repetition, coupled with duration, now require six hours of the use of two pounds of pinch force or ten pounds hand force 3 times or more per minute. The secondary risk factors have been reduced from 4 hours to 3 with the same two pounds of pinch force or ten pounds of hand force 3 times or more per minute. The physicians will have to apply the same steps in the algorithm to reach their conclusions; however, the specific criteria for primary and secondary risk factors have been updated based on the latest studies and literature. These are not the only changes to the Guidelines. Certain other updates have been made depending on the specific primary or secondary risk factor being addressed, (i.e. awkward posture, computer work, the use of handheld vibratory power tools, and cold working environments).


When a claimant alleges a particular occupational disease in which Exhibit 5 of the Medical Treatment Guidelines will be applied to determine causation, it is best to seek an Independent Medical Examination with a physician knowledgeable in applying the causation matrix. As part of the investigation of the claim, the IME physician should also be provided with a specific job description or worksite evaluation to properly identify each of the job duties that the injured worker performs. Most treating physicians will only obtain direct knowledge of the injured workers’ job duties directly from the injured worker. This oftentimes provides a skewed perception of the specific job duties, which in turn skews the overall analysis by the physician. The treating physician may find a claim to be work related when it should not be if the algorithm was properly applied.


If the IME physician has the specific job description/ergonomics assessment, coupled with medical records to establish the proper diagnosis, the physician will be in a better position to properly apply the causation matrices and provide a solid framework for reaching a causation determination. The IME physicians’ report can then be sent to the treating physician to properly assess causation and provide treatment to the injured worker or, in some cases, prevent treatment from being provided to the injured worker when it is not work-related, thus saving on medical costs.


The proposed changes to Rule 17 are not yet in effect. These are proposed changes but no rule making hearing has been announced. We suggest checking the Division website periodically. Once the changes do go into effect, we will make an announcement and let you know what changes were approved.


For additional questions regarding updates to the Medical Treatment Guidelines or recommendations when confronted with a particular issue on causation, please contact the attorneys at Lee + Kinder LLC.

legaLKonnection Firm Newsletter – December 2016

Lee + Kinder LLCThank you for taking the time to read our Firm newsletter. Our newsletter provides a monthly update on recent developments within our Firm, as well as in the insurance defense community.


In the News

Members Joshua Brown, Joseph Gren and Of Counsel John Abraham attended the National Workers’ Compensation and Disability Conference in New Orleans November 29 through December 2. The conference is held annually by various clients, vendors, and sponsors in an effort to stay abreast of industry trends and managing client needs. Mr. Brown, Mr. Gren and Mr. Abraham represented Lee + Kinder LLC and participated in the expo held at the convention center. They had the opportunity to network with both vendors and clients in addition to discussing upcoming needs for 2017 and changes to Colorado law.


Lee + Kinder LLC would like to wish everyone a very Happy New Year!


Victory Lap

Joe3Member Joseph W. Gren successfully won dismissal of a claim for penalties in Arnhold v. United Parcel Service and Liberty Mutual Insurance. Claimant was seeking penalties against Respondents for a late payment of TTD award pursuant to a prior Order. Mr. Gren, through testimony of the insurance adjuster, was able to argue that the adjuster acted objectionably reasonable in the actions taken pursuant to the Order. The ALJ found that the adjuster was credible and that the adjuster acted objectionably reasonable in her adjusting of the claim. The ALJ further found that the Claimant failed to meet her burden of proof, under the cure provision, that a penalty should be imposed in this matter. The claim for penalties was denied and dismissed.


FranNewsOf Counsel Frances McCracken successfully defeated the Pro Se Claimant’s requests for temporary disability benefits, permanent partial disability benefits, and medical benefits in Jaterka v. Johnson & Johnson and Indemnity Insurance Company of North America. Respondents previously filed a FAL that admitted for a 0% impairment rating for the work-related left cubital tunnel syndrome and lateral epicondylitis. At hearing, Claimant sought to reopen the claim on the basis that the left shoulder surgery that she underwent through her personal insurance was related to the work injury. Ms. McCracken successfully argued that Claimant was jurisdictionally barred from challenging MMI and the determination that the left shoulder complaints were not related to the work injury because Claimant did not timely file an objection to the FAL or pursue the DIME. ALJ Edie agreed that the relatedness of the shoulder injury was conclusively determined by the ATP at the time of MMI and could not be challenged in a reopening proceeding. ALJ Edie dismissed Claimant’s request to reopen the claim and denied the requests for medical and indemnity benefits related to the left shoulder injury.







Division Rule 16: Increasing the Complexity of Utilization Preauthorization Disputes

On January 1, 2017, the Colorado Division of Workers’ Compensation’s revised Rule 16 will take effect. Rule 16 encompasses the medical, legal, and administrative standards for medical billing and for preauthorization of services requested by medical providers. The revised rule impacts the daily adjusting of workers’ compensation claims, specifically, responding to requests for preauthorization of medical services consistent with the Colorado Medical Treatment Guidelines (“MTG”). The critical alterations pertaining to the utilization review process impute additional legal obligations upon the insurance carrier or third party administrator (“TPA”) to take action after receiving a preauthorization request.
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Cases You Should Know

Don’t make promises you can’t keep. ICAO reaffirmed established Colorado law that ALJs have broad discretion when determining a claimant’s Average Weekly Wage (AWW) in Cruz v. Sacramento Drilling Inc. and Travelers Property Casualty Company of America. W.C. No. 4-999-129 (ICAO October 24, 2016). In this claim, Claimant sustained an injury two weeks after beginning a new job. At hearing, Claimant argued that the AWW should be based on a 60-hour workweek because that was the number of hours originally offered by the employer and he worked 59 hours the week prior to his injury. The employer argued that following the injury, Claimant never worked 60-hour weeks and neither did similarly-situated employees. The employer argued that employees are not guaranteed hours and the AWW should not be based on the original offer. Nonetheless, the ALJ used the 60-hour workweek because the offer of employment was for 60 hours per week and the brief work history was consistent with the offer. ICAO upheld the ALJ’s Order and stressed that the ALJ properly utilized his discretion to determine the AWW. Moral of the Story: Employers should not promise a specific amount of hours to be worked in a job offer unless there is absolute certainty with the guaranteed number of hours.


Oooohhh Burn! ICAO recently determined that the higher statutory cap for disfigurement benefits is applicable for any type of burn scar and not just for facial burns and extensive scarring. Lambert v. Sturgeon Electric Co. and Zurich American, W.C. No. 4-987-545 (ICAO October 28, 2016). The ALJ awarded Claimant $6,000 in Disfigurement benefits for two burn scars on his arms that were 3.5 inches by 2 inches. Respondents appealed and argued that the disfigurement award should have been capped at $4,673.47 because the higher cap is only available for “extensive” scarring. ICAO reviewed the statute, which indicates that the higher cap applies to “extensive body scars or burn scars” and determined that the cap applies to both extensive body scars and any burn scars and upheld the award. Moral of the Story: If an employee is burned, the respondents will pay.


The phantom injury: ICAO recently found that in the case of an unexplained fall, Claimant still has the burden of proving that there was an actual injury. Magali-Tamayo v. Trioak Foods West and Travelers Insurance Company of Connecticut, W.C. No. 4-965-037 (ICAO October 28, 2016). Claimant was found lying on the floor at work with no recollection of how she got there. Claimant argued that her ongoing dizziness and cognitive issues were related to a head injury sustained during the fall. She argued that under the City of Brighton analysis, the event would be considered a neutral risk as an “unexplained fall” that would not have occurred but for the fact that she was at work. The ALJ concluded that Claimant failed to prove that she sustained any type of head injury that day that would be related to her symptoms. ICAO upheld the Order and found that if a claimant fails to prove that there is a nexus between the conditions of the employment and an actual injury, the claim will not be compensable regardless of the City of Brighton categories of risk analysis. Moral of the Story: If there is an unexplained fall, the claimant still has the burden to prove that there was an actual injury.


Buckle up. ICAO affirmed the ALJ’s determination holding Respondents did not meet their burden of proof in proving that failure to use a safety device should result in a 50% reduction in Claimant’s benefits. Shaikh v. Colorado Springs Transportation and Old Republic Ins. Co., W.C. No. 4-968-013 (ICAO April 15, 2016). Claimant was a taxi cab driver who was not wearing her safety belt when she was involved in a motor vehicle accident. Hearing was held over Respondents’ reduction of Claimant’s benefits by 50% due to her failure to use a safety device (the safety belt) provided by the employer. The ALJ determined that Respondents offered no persuasive evidence that Claimant would not have sustained the same injuries had she kept her safety belt on; thus, Respondents were not entitled to reduce Claimant’s compensation by 50%. ICAO upheld the ALJ’s determination and stressed that the mere occurrence of an injury and a claimed cause does not require the ALJ to draw the inference of causation. Moral of the Story: If an injured worker fails to use a safety device, Respondents must further prove that failure to use the safety device resulted in a worker’s injuries.


You choose, you lose. ICAO affirmed the ALJ’s decision that Claimant exercised his right to select a treating physician through his words and conduct. Williams v. Halliburton Energy Services and ACE American Ins. Co., W.C. No. 4-995-888 (ICAO April 18, 2016). Claimant was directed to Injury Care of Colorado for treatment of his work injury. Over thirty days after the injury, the employer provided Claimant with a designated provider list. Claimant hand wrote that he chose Injury Care of Colorado and he continued to receive conservative treatment. Once Claimant hired an attorney, he wished to change to his ATP, Dr. Miller. Respondents contested the change. The ALJ determined that Claimant signified through his words and conduct that he exercised his right of selection and chose Injury Care of Colorado as his ATP. ICAO upheld the ALJ’s Order and found there was substantial evidence to show that Claimant demonstrated by his actual conduct in undergoing treatment at Injury Care of Colorado that he had made his selection. Moral of the Story: A claimant’s conduct may demonstrate his choice in ATP after the right of medical selection passes to him.


DIMEs have a lot of weight, but the skinny is: DIMEs may not make up surgeries. In Serena v. ICAO, W.C. No. 4-922-344 (nsfp), Claimant sustained an industrial injury to both shoulders, and underwent bilateral shoulder surgery. The DIME physician provided Claimant with a 10% impairment rating for each shoulder for subacromial arthroplasty (joint replacement) surgery. Respondents sought to overcome the DIME. Respondents argued the DIME physician clearly erred in providing the 10% impairment rating for arthroplasty because the Claimant did not undergo this procedure. The ALJ determined Respondents failed to prove the DIME erred. The ALJ acknowledged Claimant did not undergo an arthoroplasty procedure. Nevertheless, the ALJ determined the DIME physician had discretion to provide additional impairment for “derangement” in accordance with the Division Impairment Rating Tips. Respondents appealed. The Court of Appeals acknowledged the DIME physician has discretion under the Impairment Rating Tips to provide impairment for derangement when an injured worker undergoes surgery. The Court of Appeals noted, however, that it was clear the DIME physician provided the 10% impairment under the mistaken belief the Claimant underwent arthroplasty. The Court of Appeals found the DIME physician erred. Moral of the Story: We recommend carefully reviewing DIME reports to ensure the physician is rating the correct body parts and properly following rating procedures.


The Department of Labor’s (“DOL”) new overtime rules take effect December 1, 2016,usdol_seal and employers should be reviewing and modifying their compensation and payroll practices in response. Here is a link to the new regulations adopted by the Department of Labor:

As part of this preparation, employers must consider whether and how any changes to their compensation structures will affect their employee benefit plans.

The new overtime rules increase the salary levels at which executive, administrative, and professional workers may be considered “exempt” under the Fair Labor Standard Act (“FLSA”) from overtime pay when a work week exceeds 40 hours. Initially, the standard salary level will increase from $455 to $913 per week and the total annual compensation requirement for highly compensated employee exemption will increase from $100,000 to $134,004 per year.  In addition to these initial compensation level bumps, additional upward adjustments are scheduled to occur every three years thereafter.

The immediate impact on this change is that currently classified “exempt” employees under the lower salary level, will no longer qualify for this status.  As a result, if an employee is no longer exempt under the FLSA, overtime must be paid for work performed beyond the 40-hour work week.

Employers need to respond to these changes in a number of ways.  Some are raising base salaries in order to classify additional employees as “exempt.”  Others are planning to simply pay overtime where necessary.  Others are planning to cap hours at 40 so that no overtime need be paid, or to meet their needs with part-time workers.

Regardless of the planned changes, effects on the employer’s benefit plans must be considered.  The DOL’s new overtime rules will require many employers to make sweeping and expensive changes to their compensation practices.  These changes may impact employee benefit plans in both intended and unintended ways.  Employers are urged to conduct a thorough benefit plan analysis before making any sweeping compensation changes.

If you have questions about the rule, or how it may affect your company, please contact us.

legaLKonnection Firm Newsletter – September 2016

Lee + Kinder LLC

Thank you for taking the time to read our Firm newsletter. Our newsletter provides a monthly update on recent developments within our Firm, as well as in the insurance defense community.

In the News
PWC_GolfLee + Kinder LLC had a great showing at the 2016 Professionals in Workers’ Compensation golf tournament with 4 lawyers in attendance. Member Katherine Lee and Of Counsel Frank Cavanaugh played with different foursomes. Member Joseph Gren and Associate Matt Boatwright manned the Lee + Kinder sponsored golf hole number 17 wherein a lucky hole-in-one would win $10,000.00. Unfortunately, no one aced the hole, but a great time was had by all.


Victory Lap

FranNewsIn Manuel Ledoux v. Walmart, Of Counsel Fran McCracken, defeated Claimant’s assertion that he sustained a cumulative trauma injury to his right elbow and wrist through repetitive work activities. Ms. McCracken successfully persuaded the ALJ to place significant weight on the steps provided by the Medical Treatment Guidelines (MTG) to formulate causation for cumulative trauma conditions. The ALJ was not persuaded by Claimant’s expert, Dr. Rook, because he failed to explain how Claimant’s work activities fulfilled the criteria needed to develop a cumulative trauma disorder.


mbb-news_115x125Associate Matt Boatwright successfully won dismissal of a full contest claim in Henry Leal v. United Parcel Service and Liberty Mutual Insurance. Claimant alleged that he had suffered a low back injury from twisting while driving a work vehicle. Claimant later alleged a subsequent work-related aggravation and sought additional treatment. The ALJ found that the described mechanism of injury was not sufficiently work-related to find the claim compensable and, notwithstanding, that Claimant was not credible as a medical historian. The ALJ denied and dismissed the claim.


FranNewsOSHA Injury and Illness Reporting Requirements
The Occupational Safety and Health Administration (OSHA) requires many employers with ten or more employees to keep a record of serious work related injuries and illnesses (certain low risk industries are exempted). OSHA recently announced it is expanding its “Injury and Illness Record-keeping Rule” to encourage greater transparency of employer injury and illness data. Starting in 2017, the Rule will also require some employers to disclose occupational injury and illness information to OSHA electronically. Click here to continue reading this article


Workers’ Compensation Rules of Procedure Changes – Effective 9/14/16

extranews_red-webThe Division of Workers’ Compensation recently changed and revised several Rules. These changes became effective September 14, 2016. Employers and carriers participated in public comment, voicing concerns over this change since it will certainly create over-payments. Frank Cavanaugh of Lee + Kinder, LLC participated in these public comments on behalf of the Colorado Self-Insured Association.

Several changes are more substantive than others and track statutory amendments adopted by the legislature in the last session. For example, changes to Rule 5-5 regarding the filing of final admissions of liability will affect day-to-day claims handling. Rule 5-5 now requires the physician’s narrative report along with the M164 and measurement sheets be attached to the final admission of liability. In addition, this Rule now requires that the final admission of liability state a position on maintenance medical benefits, making specific reference to the medical report including the name of the physician and the date of the report. Failure to properly abide by these requirements may void a final admission of liability and potentially lead to imposition of penalties by the Director and/or audit issues. Rules 8-6 and 8-7 also track legislative changes over requests for a change of physician. An original treating physician’s role remains in place and does not terminate until there is an initial visit with the new physician . Further, a request for change of physician and a response to the request must now be on a specific form, WC197. Please also be aware that Rules 16 and 18 are undergoing changes and have not yet been finalized. We will apprise you of these additional changes once they occur. For a detailed review of all changes to the WCRP, please click on the link below.

Click here to read the changes to Rules 1-9

Cases You Should Know

Who said lawyers can’t do math? In Richard Hutchison v. Pine Country, Inc., W.C. No. 4-972-492 (July 29, 2016), ICAO upheld the ALJ’s Order that required Respondents to pay one third of the cost of medical and temporary disability benefits because Claimant’s knee arthritis and need for a total knee replacement was equally caused by three factors including genetics, age and weight, and work tasks. ICAO held that Section 8-42-104 (3), which states that medical and temporary disability benefits shall not be reduced based on a previous injury, did not apply because the occupational disease of osteoarthritis did not involve a “previous injury.” Instead, the disability was the aggravation of the arthritis, which was equally attributed to the three different factors.
Moral of the Story: In cases of occupational diseases, the employer’s liability for medical and indemnity benefits is limited to the extent the work activities acted on the occupational disease to create the disability.


A DIME called by any other name is still a DIME: In Sean F. Clark v. Mac-Make-Up Art Cosmetics, W.C. No. 4-858-859 (August 3, 2016), claimant sustained an industrial back injury on March 5, 2010. In a respondent IME, Dr. Pitizer opined the claimant was at MMI with a 10% whole person impairment rating. Afterwards, respondents sent the ATP a letter asking whether the claimant was at MMI. The ATP did not respond, and respondents filed an application for a 24-Month DIME. At the DIME, Dr. Hattem noted the ATP placed the claimant at MMI on January 28, 2014, with a 34% whole person rating. Dr. Hattem agreed with the ATP’s date of MMI, but provided claimant with a 15% impairment rating. Claimant requested a hearing to strike the DIME report as the ATP, unknown to either party, had placed claimant at MMI before the 24-Month DIME was requested. The parties stipulated that neither party received a copy of the ATP’s MMI report before the 24-Month DIME. The ALJ determined respondents complied with the 24-Month DIME requirements set forth section 8-42-107(8)(b)(II) of requesting the ATP’s opinion whether the claimant was at MMI, and another physician opining the claimant was at MMI. Therefore, the ATP’s failure to timely disclose their report that the claimant reached MMI did not serve to frustrate the DIME process. Claimant appealed. ICAO affirmed. Of importance, the Panel clarified that 14 days from the date of service of a letter to the ATP regarding MMI was a reasonable amount of time to wait before respondents could request a 24-Month DIME.
Moral of the Story: Before requesting a 24-Month DIME, respondents must request from the ATP whether the Claimant is at MMI, and have an opinion from another physician the claimant is at MMI.


The perpetually open case of medical only claims: In Michael Thibault v. Ronnie’s Automotive Services, W.C. No. 4-970-099, (August 2, 2016), the claimant injured his right hand and index finger. Claimant received medical treatment and was placed at MMI with no impairment. Respondents filed an FAL denying indemnity and maintenance medical benefits. The claimant did not object to the FAL. Afterwards, the claimant sought to reopen the claim. The ALJ determined the claimant’s condition worsened after the FAL was filed and reopened the claim. Respondents appealed and argued claimant failed to establish his condition had worsened, and the claimant only sought to reopen the claim because he failed to timely object to the FAL. ICAO held the matter was not closed by the FAL because claims that do not admit for temporary or permanent benefits cannot be closed through an FAL. Therefore, the claimant did not need to meet the requirements to reopen the claim, and was only required to prove the medical treatment was reasonable, necessary, and related to the industrial injury, which he proved.
Moral of the Story: WCRP 5-5(A) recently changed effective 09/14/16 to allow for final admissions on medical-only claims. The FAL should be filed with a narrative report and appropriate worksheets.


Race you to the DIME in under 6 months: In Carol Lopez v. The Evangelical Lutheran Good Samaritan Society and Sentry Insurance, W.C. No 4-972-365 (ICAO August 16, 2016), ICAO reiterated the Colorado Supreme Court holding that a Claimant can qualify for a Table 53 specific spine disorder and impairment rating even if the Claimant reached MMI in less than 6 months of treatment. According to the AMA Guides, a Table 53 disorder is categorized by evidence of medically documented pain and rigidity for over six months. In this case, the DIME took place over a year after Claimant’s original back injury. The DIME physician opined that Claimant reached MMI one month after the injury and provided a 15% whole person impairment rating based on the Table 53 disorder and the loss of range of motion. Respondents argued that there could not be a Table 53 diagnosis because there was no evidence of pain for at least six months prior to the date of MMI. However, ICAO held that the impairment rating was appropriate based on the date the DIME took place. It reasoned that, at the time of the DIME, there was a rateable injury pursuant to Table 53 because there had been over a year of reported pain. ICAO held that the date of MMI does not affect the analysis of whether there is a Table 53 diagnosis.
Moral of the Story: If a Claimant reaches MMI for a back injury in less than 6 months, he or she could still receive a rating for a Table 53 disorder unless the DIME is completed in less than 6 months from the date of injury.


It’s not the claimant’s fault he got a DUI. In Brian Iten v. Meadow Mountain Plumbing and Pinnacol Insurance, W.C. No. 4-975-033 (ICAO August 15, 2016) the claimant was employed as a plumber and his job required him to drive a company van to job sites. Claimant injured his low back at work on February 11, 2015. Respondents admitted for ongoing temporary total disability benefits since the date of injury. On February 25, 2015, claimant was arrested for a DUI while driving his personal vehicle. Claimant contested the DUI charge and ultimately entered into a plea agreement. Claimant did not lose his driver’s license as a result of the DUI. Employer terminated the claimant as company policy required employees to have valid driver’s license and that if the insurance carrier refused to cover an employee, the employee could be terminated. Respondents filed a Petition to Suspend TTD benefits due to termination for cause pursuant to C.R.S. § 8-42-105(4)(a). The employer provided conflicting testimony that the claimant was either terminated because he lost his driver’s license as a result of the DUI or the insurance carrier indicated they would not insure the claimant due to the DUI charge. The ALJ did not find the testimony of the employer witnesses credible. The ALJ found that when the claimant was able to maintain his driver’s license, he reasonably believed he complied with the employer’s driving policy. Therefore, the claimant did not commit a volitional act making him responsible for his termination. ICAO affirmed.
Moral of the Story: To successfully assert termination for cause, respondents must prove the claimant violated a specific company policy and that his or her actions were volitional, which means the employee exercised a degree of control over the circumstances resulting in the termination.

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