By Jane Salem, staff attorney, Nashville
On Friday, the Appeals Board released an opinion affirming a trial Court decision that a proposed treatment is reasonable and necessary when the treating physicians, who examined the injured worker, recommended it. The employer’s reliance on a utilization review opinion saying the employee was a “suboptimal candidate” for the surgery, with which the Bureau’s medical directors agreed, didn’t overcome the presumption of correctness attached to the treating doctors’ opinions, when the employer’s experts’ opinions were based on records reviews only.
The case involved an employee seeking treatment via an open medicals provision and also raised a sticky issue about the employee’s entitlement to attorney’s fees. A divided Appeals Board vacated the trial court’s decision to deny fees.
In Walls v. United Technologies Corp., Bob Walls suffered work-related injuries to his hip. United Technologies authorized treatment with Dr. Jeffrey Adams.
The parties settled the claim. The approved agreement stated that United Technologies would pay for reasonable, necessary and work-related future medical treatment with Dr. Adams or any physician selected from a panel.
Walls later returned to Dr. Adams. An MRI showed a tear of the gluteus medius tendon, and Dr. Adams recommended surgery. United Technologies submitted the recommendation to its utilization review provider, Dr. Reece Polesky. Based on his report, the utilization review provider concluded that “the clinical findings do not appear to support the medical necessity” of the recommended surgery. Walls appealed the non-certification to the Bureau’s medical director, who agreed with the non-certification.
Dr. Adams asked for a second opinion, and the parties agreed that Walls could see Dr. William Kurtz. Dr. Kurtz examined Walls and reviewed the MRI films. He agreed with the proposed surgery and said he didn’t think Walls had hip arthritis.
United Technologies then sent Dr. Kurtz’s surgery recommendation to utilization review. Dr. Polesky noncertified, which was appealed once again. This time, both the medical director and assistant medical director agreed with the noncertification.
Walls filed a petition seeking an order that United Technologies authorize the surgery. After an evidentiary hearing, the trial court made that order.
The trial court noted that the parties agreed Dr. Adams and Dr. Kurtz were authorized treating physicians, so under the Workers’ Compensation Law, their surgical recommendations were presumed medically necessary. United Technologies didn’t rebut that presumption. The court also declined to award Walls attorney fees, characterizing United Technologies’ actions as “reasonable,” and that it would be inappropriate to “sanction” it.
Both parties appealed.
United Technologies argued the trial court erred in determining it failed to rebut the presumption of medical necessity applicable to Drs. Adams’s and Kurtz’s recommendations.
The Board began its analysis with the purpose of utilization review: it “provides employers a mechanism to assess the medical necessity of prescribed medical treatment.” The settlement agreement included a provision for reasonable and necessary future medical benefits.
Writing for the three-judge Board, Presiding Judge Timothy Conner reminded, “In these circumstances, a trial court is not bound by the determination of the utilization review physician or the Bureau’s Medical Director but is charged with conducting a de novo review to determine whether Employer rebutted the presumption that the prescribed medical treatment is reasonably necessary to treat the work injury.”
The Board wrote that Drs. Adams and Kurtz examined Walls many times and formed their recommendations based on their clinical and diagnostic findings, while Dr. Polesky never examined him and reached his conclusions on a records review. Also, the authorized doctors reviewed the MRI films and interpreted the images themselves, while Dr. Polesky only reviewed the radiology report not the actual films. The authorized doctors reviewed the MRI images and concluded they didn’t show significant arthritis. Considering all that, the Board agreed that Dr. Polesky’s opinions were less persuasive.
The Board also found it significant that Dr. Polesky didn’t directly address medical necessity. Dr. Polesky had concluded that Walls’ “advanced osteoarthritis” made him a “suboptimal candidate for surgery.” Judge Conner wrote: “Whether Employee is a ‘suboptimal’ candidate for surgery was not the issue presented to the trial court, and Dr. Polesky’s recommendation to ‘non-certify’ the surgery is, at best, circumstantial evidence that Dr. Polesky believed the recommended surgery is not medically necessary to treat the work injury.”
As to the letters from the medical directors, while they agreed with non-certification, neither “expressed an independent opinion regarding whether the recommended treatment was ‘medically necessary.’”
The trial court also found credible Walls’ testimony about his condition and limitations.
“Considering the totality of the expert and lay evidence, we conclude the preponderance of the evidence supports the trial court’s determination,” the Board held.
However, the Board split regarding the denial of attorney’s fees.
Section 50-6-226(d)(1)(B) says a court may award fees and expenses when an employer “[w]rongfully denies a claim or wrongfully fails to timely initiate any of the benefits to which the employee” is entitled if the judge finds that the benefits were owed after a hearing.
Judge Conner wrote: “Nothing in the statute relieves an employer of its burden of proof or the consequences of its decision to deny medical treatment merely because it sought utilization review of the prescribed treatment, then relied on the reviewing physician’s ‘decertification’ recommendation.”
He continued, “in circumstances where a court evaluates a claim for attorney’s fees and expenses under section 226(d)(1)(B), it is the employer that must accept the consequences of its decision to deny such treatment if that decision turns out to be ‘erroneous, incorrect, or otherwise inconsistent with the law or facts.’ If one of those consequences is that it may be ordered to pay reasonable attorney’s fees and costs, so be it.”
The Board vacated that portion of the order because it concluded the trial court had incorrectly analyzed the attorney’s fee issue under section 226(d)(1).
Judge David Hensley dissented. He wrote: “The majority ignores the fact that the parties and the trial judge did not address section 50-6-226(d)(1)(B) prior to this appeal and ignores that the Appeals Board has not heretofore addressed the applicability of section 50-6-226(d)(1)(B) to a claim for attorney’s fees based on an employer’s failure to authorize medical benefits provided for in a settlement agreement or court order.”
The Board remanded to the trial court to reconsider the issue of attorney’s fees. Because the decision at issue was a compensation order, afterward, either party may appeal again, to either the Appeals Board or a Supreme Court special workers’ compensation panel.