California workers' comp has recently experienced an earthquake-type event, the Almaraz decision.

Very few observers saw this coming. What is it, and what's the fuss?

Here's a synopsis that may be helpful for injured workers and individuals interested in workers' comp who may not have been following developments in the law closely.

Almaraz, the California Workers Compensation Appeals Board en banc decision unveiled in February 2009, may be the most significant workers' comp decision in several years (a link to the consolidated decision in Almaraz v. Environmental Recovery Services and SCIF and Joyce Guzman vs. Milpitas Unified School District and Keenan & Associates) is available at the bottom of this post.

It's a 56 page decision signed by all WCAB commissioners. In past cases the California Court of Appeal and Supreme Court have been very deferential to the expertise of the WCAB. There may be appeals filed, although the decisions in both Almaraz and Guzman return those cases to the trial level for more development of the evidentiary record.

Almaraz (it's actually Almaraz and Guzman, but I'll call it Almaraz for simplicity's sake) deals with the issue of whether and how the American Medical Association Guides 5th edition, referenced in Labor Code 4660 and in the 2005 Permanent Disability Rating Schedule, can be rebutted.

In Almaraz the WCAB makes the following important findings:
-the AMA Guides portion of the 2005 schedule is rebuttable and not conclusive
-Labor Code 4660 requires consideration of the AMA Guides but does not make the AMA Guides determinative in assessing an injured employee's impairment
-the AMA Guides does not measure work impairment and indeed excludes work from the activities of daily living considered
-the AMA Guides recognize that it is merely a first step for measuring work impairment; factors outside the guides may be considered, including the impact of the injury on the employee's ability to perform work activities
-the AMA Guides allow an evaluating physician, through the exercise of judgment, to modify an impairment rating
-the law of many other states recognize that other factors can be considered in addition to the guides

Having found that an impairment rating under the AMA Guides may be rebutted, the unanimous WCAB turned to the question of what standards are to be used in determining whether there has been rebuttal.

The conclusion?

"We conclude that an impairment rating strictly based on the AMA Guides is rebutted by showing that such an impairment rating would result in a permanent disability award that would be inequitable, disproportionate, and not a fair and accurate measure of the employee's permanent disability."

In pushing for use of the AMA Guides in California in 2004, the employer and insurance carrier community hoped that use of the AMA guides would result in more standardization of ratings and less subjectivity in the rating system.

The goal of most of the 2004 reformers was to base permanent disability ratings on a system founded on "objective" measurable impairment. This was seen as necessary to tame a system they claimed was out of control and was an element of a comprehensive reform to lower comp costs.

Pre-2005 injuries that were permanent and stationary before 1.1.05 or that resulted in the "existence of permanent disability" before 1.1.05 are rated under the pre-AMA system. The pre-AMA system based many ratings on work restriction categories, some of which were called "plateau ratings". For example, a limitation of no very heavy lifting (which had a specific definition under the "old" rating schedule) carried a 10% rating (which was then either increased or decreased by occupational and age factors). Under the former system ratings were sometimes affected by the doctor's assessment of the degree and frequency of subjective complaints.

The 2004 employer/carrier reform group wanted no room in the system for work preclusions or subjective assessment.

Reference to the AMA guides (5th edition) was inserted in SB 899.

It's a big green book, hundreds of pages long.

Of course, the reformers could have chosen other versions of the AMA guides. A number of states use versions other than the 5th edition.
Since 2004, the AMA has unveiled the 6th edition of the Guides; so far the 6th edition seems to be getting a tepid response in most states.

The 5th edition of the Guides assigns "Whole Person Impairment" figures to conditions which affect organs and body parts from head to toe.

But the Guides are not evidence based. "Whole Person Impairment" percentages under the Guides are not based on studies of work disability nor are they based on other scientific studies. The WPI figures of the Guides are ultimately every bit as arbitrary as the "plateau ratings" that were used for many conditions before SB 899.

That's why it's amusing but maddening to see some self-serving lawyers and doctors fulminating about "correct impairment ratings" under the Guides. Some of these folks now run cottage industries-as seminar leaders and as consultants- that seek to preserve "correct impairment ratings".

They are big proponents of a kind of "cookie cutter" justice.

With Almaraz, their franchise just took a huge hit.

But there's another big problem with the Guides. The Guides make it clear that they are NOT measuring work impairment, but rather impairment of other activities of daily living.

A rigid application of the Guides in some circumstances has resulted in workers being assessed with 0% "Whole Person Impairment" but with work restrictions which caused them to lose their job.

The cottage industry consultants (some of who helped author the Guides) are unable to give a satisfactory intellectual answer to that conundrum. How can a person be assigned work restrictions which preclude return to work (or which trigger the interactive process for reasonable accomodation under FEHA, the California Fair Employment
and Housing Act), and yet be assigned no AMA "Whole Person Impairment"?

This never passed the "smell test".

Almaraz basically means that a rating will have to pass the smell test.

Under Almaraz, the rating must not be "inequitable, disproportionate and not a fair and accurate measure of the employee's permanent disability".

Fairness, equity, proportionality, accuracy.

The pendulum need not swing back to excesses of the prior system. But it appears the pendulum is headed back to a system which allows greater focus on how an injury affects the individual worker.

Stay tuned. In future posts I'll be looking at what sorts of evidence may be relevant under Almaraz.

Here is the link to Almaraz:
http://www.dir.ca.gov/wcab/EnBancdecisi ... uzmanJ.pdf

Julius Young
www.boxerlaw.com
(you can subscribe to the blog by clicking on the RSS reader button on the lower right corner under "Most Recent Entries")

It's now the week that was.

Like it or not, come the expected Monday passage of the "stimulus", we're all going to be engaged in a great Keynesian experiment. Whether you think it's larded with pork or an Evel Knievel-style ramp which will boost us over the slough of depression into the promised land of economic recovery, it's coming.

Stimulus did not work for Japan, but perhaps we are different?
http://www.nytimes.com/2009/02/06/world ... r=1&hp

The Congressional Budget Office has raised significant questions about the long term effect of stimulus package debt:
http://www.cbo.gov/

Unsurprisingly, the economists can't agree:
http://www.newsweek.com/id/183611/output/print

It was a week when the crash and burn of Tom Daschle's nomination reminded us how difficult it would be achieve a comprehensive healthcare reform. Daschle was said to be uniquely positioned to shepherd such a reform through Washington, although there were concerns voiced by some about his ties to the industry. And a guy with red glasses like those? Either he's a genius or an effete politician.

It's clear that a small group of senators from Maine and the Midwest are going to hold the balance of power on many critical issues-from healthcare reform to the Employee Free Choice Act- as the Obama administration goes forward.

Here in the Bay Area there is a nasty war between SEIU and the United Healthcare West:
http://www.sfgate.com/cgi-bin/article.c ... s.business

Labor scored some wins this week. Yes, the Hilda Solis nomination is still in trouble over family tax issues (those Obama vetters now seek quite wacky!) Obama did issue an executive order that encourages union labor on federal construction projects:
http://www.boston.com/news/politics/pol ... s_lab.html

This executive order follows a series of executive orders issued January 30, 2009 that:
-reversed a Bush order that required employers to post signs informing workers of their right to limit financial support of unions serving as their collective bargaining representatives
-prohibited government contractors from being reimbursed for expenses incurred trying to influence workers on whether to form unions or engage in collective bargaining
-required federal contractors to offer jobs to qualified employees
when contracts change

On the workers' comp front, it was a week when the lights at the WCAB went dark on the first "Furlough Friday".

Apparently as a society we can only pay for so much justice.

Implementation of EAMS has delayed court settings at many boards. With furlough closures, delays will probably increase.

At the DWC there was activity on the regulatory matters:

The DWC issued revised medical treatment regs (MTUS) that affect treatment for chronic pain, elbows, and postsurgical treatment. The public can comment until February 20, 2009. Here's the link to the regs:
http://www.dir.ca.gov/dwc/dwc_newslines ... 12-09.html

The public comment period on the audit regulations ended on February 6. Here is the current audit reg draft:
http://www.dir.ca.gov/dwc/DWCPropRegs/A ... ations.pdf

This week's big compworld news was the WCAB en banc decisions in Ogilvie and Almaraz (see the last couple of posts). I'll be doing more commentary on both shortly.

Stay tuned.

Julius Young
www.boxerlaw.com

The comp community was all a-twitter today.

The big buzz? Yesterday's en banc decisions in Olgilvie and Almaraz and Guzman (see yesterday's post)

A sample of comments from sources (applicant attorneys, defense attorneys and judges) I spoke with today:

...."Courageous"....."A slippery slope"...."What took them so long?"......"Finally, the pompous AMA police are put in their place"......"FEC is rebuttable, but is it worth the effort?"......"Could some of this be used as a sword against applicants?"......"Every case in process needs to be rethought"......."How do I explain the various ramifications of this to my clients?"......"Are we back to where we started a few years ago?"...."This will make the lawyers happy"....It "blows open the doors".....
"All that crap about so-called correct impairment ratings; the emperor had no clothes"....."We will see a lot more use of subrosa films to attack medical formulations of impairment"......."This will be a big bargaining chip in future legislative and regulatory negotiations"....""This was under the radar as people focused on Boughner and Benson"...."Ogilvie is too confusing to be useful"...."Two Court of Appeals Districts could wind up with Almaraz and Guzman; that's kind of wicked"......"Now we have a hot topic for all of the conventions and continuing ed providers"....."We'll see very early on which doctors will insist on applying the AMA very mechanically and which docs will take a more expansive approach to incorporating more detailed descriptions of ratable impairment"...."Functional capacity evaluations are back".....

In the next couple of posts I'll analyze these in more depth.

Stay tuned.

Julius Young
www.boxerlaw.com

For some time I've been expecting that the WCAB would issue a decision clarifying its position on rebutting the 2005 permanent disability rating schedule.

In Scott Boughner vs. CompUSA the WCAB had upheld the validity of the 2005 PD schedule (Boughner's counsel has requested the Court of Appeal review that decision but there is no action yet on the request for writ of review).

The lesson of the Costa I, Costa II and Costa III cases has been that the WCAB will allow vocational or labor market expert testimony in an attempt to rebut the schedule. But so far, every panel decision I have seen has rejected the substance of the Costa testimony. In some cases the expert's efforts were not based on substantial evidence. In others the methodology was questioned.

Today the WCAB clarified its position, issuing two en banc decisions,
Wanda Ogilvie vs. City and County of San Francisco, and a separate decision in two cases, Mario Almaraz vs. Environmental Recovery Services and SCIF and Joyce Guzman vs. Milpitas Unified School District and Keenan and Associates.

In tandem, the decisions now provide a "road map" as to the standard for rebutting the AMA guides and the 2005 PDRS.

Note: one or both sides could seek a writ of review with the Court of Appeal. The Court of Appeal has discretion as to whether to hear such a case. Therefore, the following en banc decision are NOT necessarily the last word.

But no doubt about it. These are critical cases for the California workers' comp system.

Here is a link to a pdf of Ogilvie:
http://www.dir.ca.gov/wcab/EnBancdecisi ... ilvieW.pdf

Here's the pdf of Almaraz and Guzman:
http://www.dir.ca.gov/wcab/EnBancdecisi ... uzmanJ.pdf

In my next post I'll comment on Ogilvie and Almaraz.

Stay tuned.

Julius Young
www.boxerlaw.com
(you can subscribe to the blog by clicking on the RSS reader button on the lower right hand corner under "Most Recent Entries")

More on shredding of the "safety net":

Cash strapped counties are having problems meeting their safety net obligations......Backlogs in the welfare system that may affect some who run out of unemployment, state disability or workers' comp and are unable to find employment in a declining economy.......

Here's the Contra Costa Times piece:
http://www.contracostatimes.com/politic ... source=rss

Stay tuned.

Julius Young
www.boxerlaw.com
(you can subscribe to the blog by clicking on the RSS reader button on the lower right corner under "Most Receent Entries")