Alvarado-Depineda v. SAIF ( 2020 )

423
Argued and submitted October 16, 2019, reversed and remanded
September 10, 2020
In the Matter of the Compensation of
Maria D. Alvarado-DePineda, Claimant.
Maria D. ALVARADO-DEPINEDA,
Petitioner,
v.
SAIF CORPORATION
and Jogi - Campus Inn,
Respondents.
Workers’ Compensation Board
1703539; A168686
474 P3d 430
At work, claimant injured her right shoulder and knee. Upon closure of her
workers’ compensation claim, SAIF Corporation awarded her 11 percent whole
person impairment but did not award work disability. Following a reconsideration
process, claimant was awarded disability. However, the Workers’ Compensation
Board did not award claimant a penalty under ORS 656.268(5)(g) for SAIF’s fail-
ure to award disability at claim closure, because it concluded that SAIF could
not reasonably have known prior to claim closure the information that led to
the award of disability. Claimant seeks judicial review, contending that SAIF
had the duty to seek clarification of the extent of claimant’s impairment because
that information was ambiguous and that, had SAIF complied with that duty to
clarify, it reasonably could have known of claimant’s entitlement to disability.
Held: The board erred by not awarding claimant a penalty under ORS 656.268
(5)(g). There were multiple ambiguities on the record available to SAIF at the
time of claim closure that gave rise to SAIF’s duty to clarify the extent of claim-
ant’s impairment. Had SAIF done so, it reasonably could have known that claim-
ant was entitled to an award of work disability.
Reversed and remanded.
Dale C. Johnson argued the cause and filed the brief for
petitioner.
Allison Lesh argued the cause and filed the brief for
respondents.
Before Lagesen, Presiding Judge, and DeVore, Judge, and
Powers, Judge.
LAGESEN, P. J.
Reversed and remanded.
424 Alvarado-Depineda v. SAIF
LAGESEN, P. J.
At work, claimant injured her right shoulder and
knee. Upon closure of her workers’ compensation claim, SAIF
Corporation awarded her 11 percent whole person impair-
ment but did not award work disability. Following a recon-
sideration process, claimant was awarded disability. The
issue before us is whether SAIF’s failure to award disability
at closure warrants a penalty under ORS 656.268(5)(g).1 The
Workers’ Compensation Board determined it did not, con-
cluding that SAIF could not reasonably have known prior
to claim closure the information that led to the award of
disability. Claimant seeks judicial review, contending that,
under Walker v. Providence Health Systems Oregon, 267 Or
App 87, 340 P3d 91 (2014) (Walker I), modified on recons, 269
Or App 404, 344 P3d 1115 (2015) (Walker II), SAIF had the
duty to seek clarification of the extent of claimant’s impair-
ment because that information was ambiguous and that,
had SAIF complied with that duty to clarify, it reasonably
could have known of claimant’s entitlement to disability. On
review, we agree with claimant and reverse.
We recount the facts as found in the board’s order,
which adopted findings of fact made by the administrative
law judge (ALJ), and we supplement those facts with addi-
tional ones from the record for clarity. Vaughn v. Marion
County, 305 Or App 1, 2, 469 P3d 231 (2020).
Claimant is a 60-year-old housekeeper who injured
her right knee and right shoulder while working for Campus
1
ORS 656.268(5)(g) provides:
“If, upon reconsideration of a claim closed by an insurer or self-insured
employer, the director orders an increase by 25 percent or more of the amount
of compensation to be paid to the worker for permanent disability and the
worker is found upon reconsideration to be at least 20 percent permanently
disabled, a penalty shall be assessed against the insurer or self-insured
employer and paid to the worker in an amount equal to 25 percent of all
compensation determined to be then due the claimant. If the increase in com-
pensation results from information that the insurer or self-insured employer
demonstrates the insurer or self-insured employer could not reasonably have
known at the time of claim closure, from new information obtained through
a medical arbiter examination or from a determination order issued by the
director that addresses the extent of the worker’s permanent disability that
is not based on the standards adopted pursuant to ORS 656.726(4)(f), the
penalty shall not be assessed.”
(Emphases added.)
Cite as 306 Or App 423 (2020) 425
Inn on March 14, 2015. She consulted Dr. Abraham two
months later, who served as her attending physician through
closure of her claim. SAIF accepted her claim for right knee
contusion and sprain, right shoulder full thickness tear of
the anterior third of the proximal supraspinatus tendon,
right shoulder full thickness tear of the distal portion of
the subscapularis tendon, and right shoulder subacromial-
subdeltoid bursitis. Claimant had surgery to address her
shoulder injuries later that year.
On March 29, 2016, a job analysis for claimant’s job
as a housekeeper was prepared, which outlined the physical
requirements of claimant’s job. The analysis found, among
other findings, that “the maximum weight lifted in connec-
tion with [her] work would be 25 pounds, which is the weight
of a bag of trash or soiled linen/towels.” The analysis did
not specify exactly how high claimant might need to lift 25
pounds, but the trash and towels would need to be placed in
and removed from a supply cart, and she was required to lift
the trash bags into a dumpster. Claimant’s job also required
her to push or pull the supply cart for 20 to 40 feet between
rooms, for which she needed to be able to generate at least
“30 pounds of force * * * when the wheels were turned/not
aligned.” The analysis also indicated that she needed to be
able to lift up to 20 pounds when loading or replenishing the
supply cart.
Claimant was later examined at the request of
SAIF by an orthopedist, Dr. Kitchel. Kitchel determined
that claimant “should be considered to have a permanent
work restriction of a 10-pound lifting limit in the right arm
and no use of the right arm above shoulder height.” He also
concluded that claimant was medically stationary.
On February 2, 2017, Northwest Occupational
Medicine Center conducted a work capacities evaluation
(WCE) to determine the scope of claimant’s functional abil-
ities. Among other findings, the WCE found that claimant
could lift 25 pounds from the floor to her waist, 10 pounds
from her waist to her shoulder, and 10 pounds from her
shoulder to overhead. She could perform a lateral trans-
fer between two surfaces at waist level at a weight of 22.5
pounds, a bilateral carry of 20 pounds over 50 feet, and
426 Alvarado-Depineda v. SAIF
could push and pull a maximum of 27.5 and 25 pounds
respectively. Upon review of the job analysis, the WCE con-
cluded that claimant could return to her work as a house-
keeper because the job analysis described housekeeping as
“within the light physical demand category,” which claimant
“was able to demonstrate at least on an occasional basis.”
The WCE further concluded that “[a] safe occasional lift of
between 15 to 25 pounds is most appropriate for [claimant]
to function within and appears consistent with her job at
injury as a housekeeper.” However, the WCE also allowed
that claimant “may need breaks incorporated into her job in
order for her to complete her job duties,” even if those breaks
might be as short as 20 to 30 seconds in length. The WCE
did not address the fact that claimant was incapable of gen-
erating 30 pounds of pushing force, which her job at injury
required according to the job analysis.
One month later, Abraham performed a closing
exam wherein he noted that claimant had “been released
to modified duty” but that Campus Inn had “not had any
work for her.” In his exam findings, Abraham indicated
that (1) Kitchel had concluded that claimant should not lift
more than 10 pounds with her right arm and should avoid
overhead lifting and (2) he had “previously concurred with
Dr. Kitchel’s findings and measurements.” Abraham also
concurred with the WCE’s findings and “felt like [claimant]
was able to return to her job at injury as a housekeeper.”
He concluded, “I concur with the WCE findings in regards
to [claimant’s] return to work.” The day after the closing
exam, Abraham confirmed that concurrence by signing an
additional form from SAIF indicating his agreement with
the WCE’s findings regarding claimant’s work release to her
“job at injury.”
SAIF issued a Notice of Closure, which awarded 11
percent whole person permanent impairment for claimant’s
right shoulder and knee but did not award work disabil-
ity. Claimant requested reconsideration from the appellate
review unit (ARU).
Meanwhile, claimant’s counsel sent Abraham a let-
ter requesting clarification of claimant’s release to work and
Cite as 306 Or App 423 (2020) 427
the extent to which she was permanently restricted. The let-
ter explained the need for clarification:
“Kitchel gave her permanent restrictions of no right-armed
work over her shoulder and no lifting over 10 pounds with
her right arm. You concurred with those limitations. The
WCE was slightly ambiguous. The therapist that con-
ducted the WCE concluded that [claimant] could return to
housekeeping work, yet noted a lifting limit of 10 pounds
from waist to shoulder and from shoulder to overhead. The
job at injury required lifting and carrying up to a maxi-
mum of 25 pounds. The therapist said [claimant] met that
demand, but in truth the WCE noted the ability to do so
only in the floor to waist lift and not above the waist or
shoulder. [Claimant’s] ability at the WCE was consistent
with Dr. Kitchel’s limitations.”
In response, Abraham signed his agreement with the fol-
lowing statement:
“Per the WCE and Dr. Kitchel’s report, [claimant] is
limited to modified housekeeping work, which will exclude
any work activities that require her to lift more than 10
pounds with her right dominant arm above waist level or to
use her right arm above shoulder level. These are perma-
nent restrictions.”
Later, the ARU requested information regarding
claimant’s residual functional capacity. Abraham clarified
that claimant could lift “10 lbs to her waist level 2/3 of the
time. No lifting over shoulder[,] 10 lbs waist to shoulder less
than 1/3 time.”
Based on its examination of the information before
SAIF at the time of closing, as well as Abraham’s clarifying
opinions, the ARU awarded claimant work disability bene-
fits. It concluded that Abraham’s post-closure reports showed
that claimant was incapable of performing the duties of her
job at injury. The ARU also found that “SAIF could reason-
ably have obtained the information in Dr. Abraham’s ‘post-
closure’ reports by seeking clarification of claimant’s work
release before claim closure,” and it therefore awarded a
25 percent penalty under ORS 656.268(5)(g).
SAIF requested a hearing before an ALJ, contest-
ing the penalty but not the modified award. It argued that
428 Alvarado-Depineda v. SAIF
Abraham’s clarification was a post-closure change of opin-
ion that was unavailable at the time of claim closure, there-
fore, SAIF argued, it could not reasonably have known the
information that resulted in claimant’s increased award.
The ALJ disagreed and affirmed the penalty. It noted that
Abraham’s closing exam mentioned both claimant’s return
to modified work duty and her ability to perform her job at
injury. And the ALJ ultimately concluded that Abraham’s
concurrence with both Kitchel and the WCE left “internal
inconsistencies and unexplained changes in opinion [that]
were enough to have dictated the need for clarification before
claim closure.”
SAIF then sought board review. On review, the
board reversed the penalty. It reasoned that the information
leading to the increased award—Abraham’s post-closure
reports—only became available after SAIF had closed the
claim and that, before claim closure, Abraham had unam-
biguously released claimant to her job at injury. Therefore,
the board concluded, SAIF could not reasonably have known
the information that resulted in a modification of claimant’s
award.
Claimant petitioned for judicial review. She assigns
error to the board’s (1) conclusion that SAIF could not rea-
sonably have known prior to claim closure the information
that led to claimant’s increase in award and (2) failure to
explain its conclusion that Abraham had unambiguously
released claimant to her job at injury. Claimant argues that,
under Walker, when there is cause for uncertainty as to the
extent of a claimant’s impairment, the insurer has the duty
to request clarification. SAIF contends that (1) the board
did not err because claimant’s increase in award was based
on post-closure reports that could not reasonably have been
known to SAIF at the time of claim closure and (2) substan-
tial evidence supports the board’s interpretation of the med-
ical record. We agree with claimant.
We review the board’s determination of whether an
increase in an award for permanent disability “could not
reasonably have been known at the time of claim closure”
for legal error. Walker II, 269 Or App at 407-08. “Whether
an action is reasonable depends on the underlying facts
Cite as 306 Or App 423 (2020) 429
and, based on those facts, whether the conclusion the board
made constitutes an error of law.” Id. at 407. The insurer
has the burden of establishing that, at the time of claim
closure, it could not reasonably have known the informa-
tion that would lead to an increase in award. Id. at 408.
Therefore, the issue before us is whether the record supports
the board’s legal conclusion that SAIF “could not reasonably
have known at the time of claim closure” the extent of claim-
ant’s impairment.
In assessing whether an insurer “could not reason-
ably have known” the extent of a claimant’s impairment, we
take into account the information in the insurer’s hands at
the time of closure, including the insurer’s medical file on
the claimant, the insurer’s “duty to gather the information
necessary to issue its notice of closure,” and the insurer’s
related, legally recognized duty to seek clarification and
gather additional information in the face of ambiguities.
See id. (concluding that the insurer could reasonably have
known that the claimant was entitled to a greater award
because it could have recontacted the claimant’s attending
physician if it was unsure of the extent of the claimant’s
permanent disability, as the ARU later did after claim clo-
sure);2 see also Sanchez v. SAIF, 242 Or App 339, 349, 255
2
We note that our recognition in Walker II of an insurer’s duty to clarify
the extent of a claimant’s impairment in the face of ambiguities in the claim-
ant’s records is consistent with the legislative history of ORS 656.268 adding the
provision exempting insurers from penalties if they “could not reasonably have
known” at the time of closure the information leading to the post-closure increase
of benefits. See Or Laws 2005, ch 569, §§ 1-2. The legislature contemplated that
an insurer would still be penalized under the statute if it “failed to meet its
obligation to obtain full information necessary to rate the worker’s impairment.”
Audio Recording, House Committee on Business, Labor and Consumer Affairs,
HB 2404, May 2, 2005, at 1:46:20 (comments of Vicky Graves, manager of the
Claims Closure Division of Liberty Northwest), https://olis.leg.state.or.us (accessed
July 21, 2020). The “could not reasonably have known” wording in the statute was
intended to protect insurers from liability for penalties where the post-closure
increase in a claimant’s award is due to factors beyond the insurer’s control:
“Unfortunately, the existing language is sufficiently broad that it also man-
dates a penalty under some circumstances in which a self-insured employer
has acted lawfully and appropriately in rating impairment only to see the
award increase based on changes in the opinion of the attending physician or
other factors not within its control. While a penalty provision that sanctions
the breach of duty by an insurer or self-insured employer makes sense, it
makes no sense to penalize an insurer or self-insured employer for matters
over which it had no control.”
430 Alvarado-Depineda v. SAIF
P3d 592 (2011) (“Whether a claim was properly closed must
be based on the body of information actually available at
the time of closure, because, pursuant to ORS 656.268(1)(a),
the claim may be closed only when ‘there is’ (as opposed to
could have been) sufficient information for the insurer to
close that claim.”).
Applying that standard to the information that was
available to SAIF prior to claim closure here, the record
was such that SAIF had the duty to seek clarification from
Abraham before closing claimant’s claim. First, the WCE
found that claimant could return to her job at injury even
though at least one of its findings—the finding that claimant
could not generate 30 pounds of force to push a cart—did not
meet the requirements of claimant’s job analysis. Second,
the lifting requirements outlined in the job analysis, when
compared to the WCE’s findings regarding claimant’s lift-
ing capabilities, give rise to another ambiguity. The WCE
finds that claimant cannot lift more than 10 pounds above
her waist. But, according to the job analysis, claimant must
lift 25-pound bags of trash into a dumpster, and common
experience with dumpsters would suggest that people usu-
ally have to lift trash bags higher than their waists to put
them in dumpsters. Third, the WCE’s recommendation that
claimant return to her “job at injury” adds another ambi-
guity; that recommendation was qualified by findings that
claimant could meet the demands of her job “at least on
an occasional basis” and that claimant “may need breaks
incorporated into her job in order for her to complete her job
duties.” Fourth, in claimant’s closing exam, which occurred
after the WCE, Abraham indicated that claimant had “been
released to modified duty,” despite also agreeing with the
WCE’s conclusion that claimant could return to her job at
injury, giving rise to yet another ambiguity about claim-
ant’s disability at the time of closure.3 Fifth, Abraham con-
curred in his closing exam with two conflicting reports: He
Audio Recording, Senate Rules Committee, HB 2404, June 17, 2005, at 50:42
(comments of Vicky Graves on behalf of insurers), https://olis.leg.state.or.us
(accessed July 21, 2020).
3
Although not clarified until after claim closure, we note that Abraham did
in fact appear to understand the WCE to be releasing claimant to modified duty.
Upon clarification, Abraham indicated that “[p]er the WCE and Dr. Kitchel’s
report, [claimant] is limited to modified housekeeping work.”
Cite as 306 Or App 423 (2020) 431
concurred with Kitchel’s finding that claimant could not use
her right arm above her shoulder, then, immediately after
that concurrence, agreed with the WCE’s finding that claim-
ant could lift up to 10 pounds above her shoulders.
Those multiple ambiguities on the record available
to SAIF at the time of claim closure gave rise to SAIF’s duty
to clarify. That is, to avoid the penalty under ORS 656.268
(5)(g), SAIF had an obligation to gather the information nec-
essary to determine the extent of claimant’s impairment and
clarify any apparent ambiguities in that information. Had
SAIF done so, it reasonably could have known that claim-
ant was entitled to an award of work disability, a conclusion
that is compelled by the fact that, when asked about those
ambiguities, Abraham clarified his opinion. As for SAIF’s
contention that Abraham’s initial opinion was clear because
he concurred in multiple instances with the WCE’s conclu-
sion regarding claimant’s release to work, that argument is
undercut by the inconsistencies in the WCE and Abraham’s
confusion, apparent on the face of his initial opinion, about
the WCE’s release of claimant to modified work.
Reversed and remanded.