Cambrian Holding Company, Inc. v. Ld Sexton ( 2021 )

RENDERED: DECEMBER 10, 2021; 10:00 A.M.
NOT TO BE PUBLISHED
Commonwealth of Kentucky
Court of Appeals
NO. 2021-CA-0451-WC
CAMBRIAN HOLDING COMPANY,
INC. APPELLANT
PETITION FOR REVIEW OF A DECISION
v. OF THE WORKERS’ COMPENSATION BOARD
ACTION NOS. WC-18-60509, WC-19-00595, AND WC-19-01095
L.D. SEXTON; APPALACHIAN
REHABILITATION TEAM; FUGATE
FAMILY CHIROPRACTIC; DR.
JAMES VARNEY; DR. JOHN
GILBERT; KENTUCKY MOUNTAIN
HEALTH; KENTUCKY PAIN
MANAGEMENT SERVICES;
MOUNTAIN COMPREHENSIVE
HEALTH CORPORATION;
HONORABLE PETER NAAKE,
ADMINISTRATIVE LAW JUDGE;
PIKEVILLE MEDICAL CENTER;
PIKEVILLE NEUROLOGY; SPINE
AND BRAIN NEUROSURGICAL; DR.
VAN BREEDING; WHITESBURG
ARH; AND WORKERS’
COMPENSATION BOARD APPELLEES
OPINION
AFFIRMING
** ** ** ** **
BEFORE: ACREE, GOODWINE, AND JONES, JUDGES.
JONES, JUDGE: Cambrian Holding Company Inc. (“Cambrian”), has petitioned
this Court for review of a decision of the Workers’ Compensation Board (“the
Board”), which affirmed the October 9, 2020 opinion, order, and award rendered
by the Administrative Law Judge (“ALJ”). On appeal, Cambrian asserts the Board
erred as a matter of law when it held that the time limits for the submission of
medical bills set out in KRS1 342.020(4) and 803 KAR2 25:096 §11 apply only
after entry of an interlocutory or final award. Having reviewed the record and
being otherwise sufficiently advised, we affirm.
I. BACKGROUND
On October 9, 2018, while working as an underground coal miner for
Cambrian, Sexton struck his head on the mine roof. Sexton reported to the job site
the next day but was unable to work because he could not lift his arms. He sought
medical care from Dr. Van S. Breeding. Sexton’s chief complaint was neck pain.
After conservative treatment failed, Sexton was referred to Dr. John Gilbert, a
1
Kentucky Revised Statutes.
2
Kentucky Administrative Regulations.
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neurosurgeon. Dr. Gilbert recommended Sexton undergo a cervical fusion surgery.
Dr. Gilbert performed the surgery in January 2020.
Sexton never returned to work and requested Cambrian to provide him
with temporary wage and medical benefits. However, Cambrian denied Sexton’s
claim. Sexton’s health insurance covered his surgery. Eventually, Sexton filed a
specific injury claim with the Department of Workers’ Claims as related to the
October 9, 2018 incident alleging cervical, thoracic, lumbar, and psychiatric
injuries. He also filed separate hearing loss and coal workers’ pneumoconiosis
(“CWP”) claims. Sexton’s claims were consolidated and assigned to a single ALJ
for adjudication.
Following the submission of proof and a final evidentiary hearing, the
ALJ rendered an opinion, order, and award. Therein, the ALJ: (1) dismissed
Sexton’s CWP claim; (2) awarded only medical benefits for Sexton’s hearing loss
claim; (3) determined that the October 9, 2018 incident caused a temporary
psychological injury for which Sexton was entitled to medical benefits from the
date of injury through May 4, 2020, the date of maximum medical improvement;
(4) concluded that Sexton failed to demonstrate any permanent injuries to his
lumbar and thoracic spine and dismissed his claim for permanent partial disability
and future medical benefits for those alleged injuries; and (5) found that the
October 9, 2018 incident caused Sexton to suffer a cervical spine injury which left
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him 28% permanently impaired and rendered him totally and permanently disabled
entitling Sexton to temporary total disability benefits, permanent total disability
benefits, and past and future medical benefits, including compensation for the
cervical fusion surgery.
Cambrian appealed the ALJ’s award to the Board. Before the Board,
Cambrian argued that the ALJ erred in failing to account for Sexton’s preexisting
active cervical spine issues and in finding him totally disabled. Cambrian also
asserted that the ALJ erred in concluding that it was responsible for past medical
expenses, which were not submitted in accordance with the time limits prescribed
by KRS 342.020(4) and 803 KAR 25:096 §11. After the Board affirmed the ALJ,
Cambrian petitioned this Court for further review. In this appeal, Cambrian
contests only the portion of the Board’s opinion which holds KRS 342.020(4) and
803 KAR 25:096 §11 do not apply pre-award.
II. STANDARD OF REVIEW
The question before us is one of pure statutory and regulatory
interpretation. “As a reviewing court, we are bound neither by an ALJ’s decisions
on questions of law or an ALJ’s interpretation and application of the law to the
facts. In either case, our standard of review is de novo.” Bowerman v. Black
Equipment Co., 297 S.W.3d 858, 866 (Ky. App. 2009).
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III. ANALYSIS
In relevant part, KRS 342.020(4) states that “the provider of medical
services shall submit the statement for services within forty-five (45) days of the
day treatment is initiated and every forty-five (45) days thereafter, if appropriate,
as long as medical services are rendered.” Additionally, 803 KAR 25:096 §11
provides:
Section 11. Request for Payment for Services Provided or
Expenses Incurred to Secure Medical Treatment.
(1) If an individual who is not a physician or medical
provider provides compensable services for the cure or
relief of a work injury or occupational disease, including
home nursing services, the individual shall submit a fully
completed Form 114 to the employer or medical payment
obligor within sixty (60) days of the date the service is
initiated and every sixty (60) days thereafter, if
appropriate, for so long as the services are rendered.
(2) Expenses incurred by an employee for access to
compensable medical treatment for a work injury or
occupational disease, including reasonable travel
expenses, out-of-pocket payment for prescription
medication, and similar items shall be submitted to the
employer or its medical payment obligor within sixty
(60) days of incurring of the expense. A request for
payment shall be made on a Form 114.
(3) Failure to timely submit the Form 114, without
reasonable grounds, may result in a finding that the
expenses are not compensable.
Before the Board, Cambrian argued that the ALJ erred in ordering it
to provide compensation for the medical expenses not submitted in accordance
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with KRS 342.020(4) and 803 KAR 25:096 §11. The Board, however, concluded
that the ALJ correctly interpreted the submission requirements as applying only
after an award had been entered by an ALJ. Cambrian urges us to reverse on the
basis that the Board misinterpreted the statute and its accompanying regulations.
This exact issue was recently decided by the Kentucky Supreme Court
in Wonderfoil, Inc. v. Russell, 630 S.W.3d 706 (Ky. 2021). In that case, the
claimant, Richard Russell, sustained an injury to his right arm while working for
Wonderfoil. Before the ALJ, Wonderfoil admitted the injury was compensable;
however, it argued that the ALJ should not order it to compensate Russell for past
medical expenses not submitted in accordance with KRS 434.020(4) and 803 KAR
25:096 §11. The ALJ agreed with Wonderfoil and ruled that Russell’s unpaid
medical expenses were not compensable based on the untimely submissions.
Russell appealed to the Board. The Board reversed holding that the submission
requirements apply only after an interlocutory decision or final award has been
entered by the ALJ. After this Court affirmed the Board, Wonderfoil sought
further review from the Kentucky Supreme Court.
The Supreme Court first examined 803 KAR 25:096 §11(2)’s
requirement that “[e]xpenses incurred by an employee for access to compensable
medical treatment . . . shall be submitted to the employer or its medical payment
obligor within sixty (60) days of incurring of the expense.” The Court determined
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that the statute was ambiguous because it was impossible to tell whether it “applies
only post-award, during litigation but pre-award, or even before the potential
claimant files his claim.” Wonderfoil, Inc., 630 S.W.3d at 710. The Court then
examined 803 KAR 25:096 §11(2) in the context of the broader scheme
established by the Department of Workers’ Compensation’s administrative
regulations. In so doing, the Court noted that various other regulations required the
claimant to disclose and submit unpaid medical expenses prior to final adjudication
by the ALJ. See 803 KAR 25:010 §7; 803 KAR 25:010 §13(9)(a). It concluded
that interpreting 803 KAR 25:096 §11(2)’s sixty-day requirement to apply before
entry of an award would “result in a direct contradiction with 803 KAR 25:010 §
7(2)(f), which requires the claimant disclose unpaid medical bills within forty-five
days of filing his claim and within ten days of receiving new bills after the initial
forty-five days has passed.” Wonderfoil, Inc., 630 S.W.3d at 711. Ultimately, the
Court held that 803 KAR 25:096 §11 applies only post-award because this
interpretation was the only way to avoid a contradictory and absurd result. Id.
The Court rejected Wonderfoil’s argument that interpreting KRS
342.020(4) and 803 KAR 25:096 §11(2) to apply only post-award would result in
unfair surprise and hardship to employers. It explained:
Additionally, our interpretation does not offend due
process by creating unfair surprise to employers, despite
arguments made otherwise to this Court. Even under our
interpretation of 803 KAR 25:096, § 11(2), a claimant is
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still required to submit medical expenses they wish to
have paid pursuant to 803 KAR 25:010, §§ 7 and 13.
Those medical expenses must be included in the
claimant’s notice of disclosure that must be filed within
forty-five days of the issuance of the Notice of Filing of
Application. 803 KAR 25:010, §7(2)(e)7. The claimant
is then under a continuing obligation to turn over new
medical expenses within ten days of receiving those
expenses pursuant to 803 KAR 25:010, §7(2)(f). Further,
a claimant is required to bring copies of unpaid medical
bills and expenses to the benefit review conference. 803
KAR 25:010, §13(9)(a). If he or she fails to do so and
does not show good cause, such failure “may constitute a
waiver to claim payment for those bills.” Id. These
requirements prevent employers from being unfairly
surprised by requested medical expenses and provide a
mechanism by which claimants may be penalized for
failure to comply.
Wonderfoil, Inc., 630 S.W.3d at 713.
In keeping with the above explanation, the Court observed that
Wonderfoil “did not defend on the basis of Russell’s failure to submit his medical
expenses under any other regulation [such as 803 KAR 25:010, §7 or KAR 25:010,
§13(9)].” Id. It cautioned, however, that had Wonderfoil done so, the result may
have been different.
In his opinion, order, and award, the ALJ explicitly stated that Sexton
“filed medical billing regarding all denied medical treatment, mileage, out-of-
pocket expenses and co-payments[.]” We presume the ALJ was referring to
Sexton’s filing requirements under 803 KAR 25:010 §7 and KAR 25:010 §13(9).
In any event, Cambrian did not argue before either the Board or this Court about
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any noncompliance with these regulations. Like Wonderfoil, Cambrian defended
solely on the basis that it should not have liability for medical expenses submitted
outside the time frames established by KRS 342.020(4) and 803 KAR 25:096,
§11(2). The Board properly rejected Cambrian’s argument since no award had
been entered prior to the ALJ’s October 9, 2020 opinion, order, and award.
Wonderfoil, Inc., 630 S.W.3d at 711.
IV. CONCLUSION
For the reasons set forth above, we affirm the Workers’ Compensation
Board.
ALL CONCUR.
BRIEF FOR APPELLANT: BRIEF FOR APPELLEE L.D.
SEXTON:
W. Barry Lewis
Hazard, Kentucky Emily Faith Wetmore
Hazard, Kentucky
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