Good Samaritan: Hip Check to Vending Machine Awarded


In an unusual claim for benefits, an employee fractured his hip when he hip checked a vending machine to help a female coworker get a bag of potato chips. The vending machine hip check case even received some national attention. The worker hit the vending machine hard enough that he suffered an impacted, displaced fracture of his right hip and required immediate surgery.

Over the objections of his employer, compensation was awarded for both disability and medical benefits. Hip checking the vending machine was not part of his regular job duties but the Commission allowed compensation under the “personal comfort” doctrine. To most people, this might seem a bit unusual but the law provides that personal acts like going to the bathroom or going to the break room are generally considered to be “in the course of" employment and are considered a normal part of expected "personal comfort" necessary for regular employment.

The Appellate Court in Circuit City v. Illinois Workers Compensation Commission (2nd Dist, 5/21/09, modified 7/9/09) viewed the hip check case more like a “ Good Samaritan” case, in that he was coming to the aid of a female coworker. The injured worker testified he bumped the machine with his shoulder rather than an actual hip check and it was further noted that the employer knew that the machine was broken. In this instance, the Appellate Court said that the Commission could find it compensable as long as the actions were reasonably foreseeable.

Past “Good Samaritan” cases have awarded compensation for a traveling employee killed while helping a stranded motorist while driving on a service call (Ace Pest Control, 1965) and in the case of a Chicago harbor master who jumped in to save someone from drowning in Lake Michigan (Metropolitan Water Dist., 1995). The test for compensation depends on whether the actions are reasonably foreseeable.

Thomas A. Robinson, J.D., of Larson's Worker's Compensation Law(LexisNexis) wrote a short article for the Workers’ Comp Kit Blog describing the vending machine incident as a “Chivalrous Act” in coming to the aid of the female coworker. The case is also posted on Illinois Top Cases on the Lexis Larson's WC Law Center.

Larson’s Workers’ Compensation Law, § 21.01 points out that “personal comfort” acts can be considered part of regular employment but they also note that the acts cannot be unusual or unreasonable.

This case could have just as easily been denied by the Illinois Workers Compensation Commission as an unreasonable act. In fact, the claim probably would have been denied if the injured worker was trying to retrieve his own bag of potato chips rather than assisting a female coworker. The "Chivalrous Act" of helping a female coworker brought it more in line with prior awards under past "Good Samaritan" cases.

To review Illinois workers compensation benefits, contact an Illinois workers compensation attorney.

Chicago Workers Compensation Attorney -- 6-22-09


Settlements: Medicare Set Aside Future Drug Costs and Uniform Pricing


Employers may soon see a spike in future drug costs for settlements going through the MSA approval process after June 1, 2009. Medicare will begin independent pricing of future drug costs in Workers Compensation Medicare Set Aside proposals as of June 1, 2009 using Average Wholesale Price (AWP) for drugs based on prices listed in the RED BOOK (r) Drug References.

CMS will no longer recognize other pricing methods using workers compensation contractual discounts for prescription drugs in Medicare Set Aside proposals. What does this mean?? Carriers and employers will be required to fund future drug costs based on the average wholesale price of drugs in use before any contractual discounts, before any WC state fee schedule discounts or before any future shift from brand names to generics. MSA submissions can no longer take advantage of pricing in the "Doughnut hole" into MSA proposals by excluding funds for Medicare Part D prescription deductibles.

The new pricing will assume a lifetime supply of drugs in use at the time of the MSA proposal. CMS will also look to the past 2 years of drugs used and to the expectations for future drug use based on the treating doctor's recommendations.

This recent change adopting uniform pricing is designed to eliminate some of the past abuses in under pricing MSA drug proposals such as "Doughnut hole" pricing and utilization review assumptions of tapering use of narcotics which were not supported by the treating physician's records.

The upshot for most employers is that future drug allowances in a MSA proposals may cost more than if those medical rights had remained open under workers compensation. Carriers may be better off leaving the prescription drug rights open under a settlement and paying for the future drugs using a qualified assignment and purchasing an annuity. That option would allow the carrier or employer to continue to use discounted pricing or use applicable state fee schedules and also let an employer be the residual beneficiary on the annuity policy (should the worker die early) and stand to receive a return of some portion of the money rather than fully funding lifetime drugs at average wholesale prices to satisfy Medicare MSA pricing requirements.

MEDVAL compared the increase in costs from their normal prescription pricing methods to the new average wholesale pricing (AWP) and came up with an astonishing $1.4MM difference on the first 17 cases reviewed. If that jump in pricing is reflective of expected average MSA cost increases under the new AWP pricing requirements, it would truly be a bitter pill to swallow for most employers and most workers comp carriers.

Contact our Chicago workers comp attorneys for questions on Illinois workers compensation settlements and MSA requirements.

(8-23-09) Update: PMSI records significant increase in MSA allocations under new prescription drug guidelines

Chicago workers compensation Attorney -- 6-20-09


Failure to Quit Smoking Defense: Disability Benefits and 3rd Surgery Awarded


Smoking alert. In a recent case, a smoker was denied disability benefits and denied a new surgery by his employer because he could not quit smoking following his low back surgery. While the current social and political consensus is that tobacco smoking is evil, bad and harmful, Illinois has yet to make it a criminal activity sufficient to deny workers' compensation benefits.

In Global Products (1st Dist. June 9, 2009) the IME defense doctor blamed a failed back fusion on smoking. Based upon the IME opinion, the employer denied temporary disability benefits and denied a proposed 3rd lumbar surgery. The arbitrator and the Illinois Workers Compensation Commission disagreed and awarded a full 6 years of temporary disability benefits, a third lumbar fusion surgery and awarded penalties and attorneys fees for the unreasonable denial of benefits.

Smoking or obesity are not yet in and of themselves a legitimate reason for an employer to deny surgery or to deny disability benefits in Illinois. That did not stop the employer in Global from arguing that smoking was a form of "injurious practices" under Section 19(d) of the Illinois Workers Compensation Act. The employer argued that continued smoking was a deliberate intentional act undertaken to retard the medical recovery.

The doctors agreed that there is an increased risk of fusion failure in smokers. Smokers are well advised to quit smoking to increase their healing, decrease their recovery time and increase their chances for a successful back fusion. It is clear that the doctors did advise the injured worker to quit smoking. The law is also clear that "If any employee shall persist in insanitary or injurious practices which tend to either imperil or retard his recovery or shall refuse to submit to such medical, surgical, or hospital treatment as is reasonably essential to promote his recovery, the Commission may, in its discretion, reduce or suspend the compensation. 820 ILCS 305/19(d)

There was no evidence that the worker had deliberately attempted to impair his recovery. In fact, the injured worker did make an unsuccessful attempt to quit smoking. Anyone who has tried to quit smoking knows that it is not an easy proposition.

Our Appellate Court found that the employer could "reasonably rely" upon the IME opinion blaming a failure to quit smoking in cutting off benefits and so they denied the award of penalties and attorneys fees.

What is our court saying ?? That the law did not support the employer's denial of benefits based upon a failure to quit smoking but that the "smoker defense" was reasonable enough to avoid penalties and attorneys fees. Was the court creating a new defense sufficient to tie up benefits without the imposition of penalties and fees for improperly delayed benefits?? Is this the message or are they really emphasizing that reliance on an employer's IME opinion will avoid penalties?? Are obesity and diabetes the next "reasonable defenses" sufficient to deny benefits since they are also conditions allegedly within the worker's control that impair and prolong recovery as long as the IME doctor blames these two known risk factors for a delay in recovery?? In our view, probably not. Obesity and diabetes are much harder to control.

See: Larson's Workers' Compensation Law § 10.10 Refusal of Reasonable Treatment: an unreasonable refusal to follow medical instructions will usually lead to a loss of disability benefits attributable to the refusal but, when the recommended treatment involves things like weight loss reduction .... the courts have generally been far less stern, ... (the courts) are reluctant to stigmatize human failures as a ''willful refusal.'' Here, as in the case of (refusing surgery), the test of reasonableness of the worker's refusal applies.

Although an employer's reliance upon a medical opinion will generally avoid penalties, here, that medical opinion did not support an existing defense to the payment of compensation under Illinois law. The Court held that failure to quit smoking does not constitute an intervening act breaking the chain of medical causation nor does it constitute a willful, intentional and deliberate interference with recovery.

I agree with the dissent that denying workers compensation disability benefits without an existing legal basis is unreasonable and it should generally lead to an award of penalties against the employer.

To review workers compensation benefits and existing defenses contact our Chicago workers compensation attorneys.

Chicago Workers Compensation Attorney -- 6-14-09


National Study of Illinois Workers Compensation Proposed


H.R. 635, the “National Commission on State Workers’ Compensation Laws Act of 2009” (Jan. 22,2009) would create a federal commission to study the state-based workers’ compensation insurance system and make recommendations for improvements. Under the proposal, the Commission would have the authority to hold hearings, issue subpoenas, take testimony, and receive evidence. It would be required to make recommendations for improvements to the workers compensation systems within 18 months. You can expect the study to recommend adoption of greater nationalized standards.

I would expect that any suggestion for a nationalized system of medical payments would be modeled after Medicare and severely reduce current medical payments to our doctors and hospitals for workers compensation injuries.

The National Association of Professional Insurance Agents recently came out to oppose to the proposed study as unjustified and simply a waste of taxpayers’ money.

To read further details, see "PIA Opposes Federal Commission to Study State Workers Compensation Laws on LexisNexis. LexisNexis provides the Larson's Workers Compensation Law Center for valuable resources for attorneys and the workers compensation industry.

Chicago Workers Compensation Attorney -- 6-01-09

Medicare Set Aside Approval Proposed Changes


Reform legislation has been introduced to streamline the Medicare Set Aside review process. Representative John Tanner (Tennessee) re-introduced legislation H.R. 2641 ( May 21, 2009) to amend section 1862 of the Social Security Act. The bill proposes to establish an exemption for low dollar workers compensation settlements and an exemption where there is no expectation of future medical care related to the work injury.

The bill establishes (1) a safe harbor for low value settlements of $25,000 or less, (2) an exemption where there is no expectation of future medical care and (3) an exemption where the injured worker is unlikely to become eligible for Medicare within 30 months after the date of the settlement.

Importantly, the proposed bill provides a definition of "compromise settlements" which are now already exempt from the need for Medicare set aside arrangements under the federal regulations but currently the word "compromise" is not adequately defined to provide a real exemption. Under the new bill, "compromise settlements" would mean a settlement where the workers' compensation claim is denied or contested, in whole or in part and the settlement does not provide for full payment of benefits.

Where a set aside agreement is required, the bill mandates set-aside account dollars shall be based on the particular state workers' compensation fee schedule in effect as of the date of the settlement.

Importantly, under the proposed bill, Medicare would allow for a reduction of the Set Aside Account by the costs and expenses incurred in establishing, administering, or securing approval for the Medicare set-aside. That includes attorneys fees, third-party vendors, and any appointed trust account administrators. The current system does not allow for reduction of Medicare set aside accounts by costs incurred for attorneys fees or costs for approval and administration.

In an effort to achieve an equitable assessment for future medical expense accounts, the bill also proposes a proportional % adjustment for "compromise" settlement agreements. In general, the proposal allows the parties to reduce the set aside account amount in direct proportion to the full value of the claim if there were no disputes involved. The percentage reduction for the set aside account would be equal to the % of benefits denied or contested out of the settlement as compared to full value.

This section will cover all those settlement agreements that are currently partially disputed and represent a real reducuction in workers compensation settlement value based on the disputes in the case. This proposal actually attempts to correct the current process whereby parties are forced to fund full future medical amounts even though the benefits in the claim are disputed and even though the injured worker is only receiving half or less of full value because of the disputed issues in the case.

Time wise, the bill proposes a 60 day period for the government to approve or disapprove the set aside proposal. Under the current system, we have had MSA approval take from 6 months to as long as a year and a half after reaching a settlement agreement in the workers compensation claim. Meanwhile, the injured worker continues to incur medical bills for medical care and prescription expenses but they do not have access to the Medicare set aside funds. While the insurance carrier is waiting for CMS approval on the MSA, most carriers will not pay the medical bills waiting to see if Medicare approves the settlement.

The proposal is also designed to set out standards for the review process by CMS contractors and attempts to set review standards for amounts to be reserved in Medicare set aside accounts.

The current status of the bill as of this writing, HR 2641 has been referred to the House Committee on Ways and Means and to the Committee on Energy and Commerce.

chicago workers compensation attorney
-- 6-01-09