Cedar Lake Park Place v. Penny Berry

IMPORTANT NOTICE
NOT TO BE PUBLISHED OPINION
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PURSUANT TO THE RULES OF CIVIL PROCEDURE
PROMULGATED BY THE SUPREME COURT, CR 76.28(4)(C),
THIS OPINION IS NOT TO BE PUBLISHED AND SHALL NOT BE
CITED OR USED AS BINDING PRECEDENT IN ANY OTHER
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UNPUBLISHED KENTUCKY APPELLATE DECISIONS,
RENDERED AFTER JANUARY 1, 2003, MAY BE CITED FOR
CONSIDERATION BY THE COURT IF THERE IS NO PUBLISHED
OPINION THAT WOULD ADEQUATELY ADDRESS THE ISSUE
BEFORE THE COURT. OPINIONS CITED FOR CONSIDERATION
BY THE COURT SHALL BE SET OUT AS AN UNPUBLISHED
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ENTIRE DECISION SHALL BE TENDERED ALONG WITH THE
DOCUMENT TO THE COURT AND ALL PARTIES TO THE
ACTION.
RENDERED: DECEMBER 16, 2021
NOT TO BE PUBLISHED
Supreme Court of Kentucky
2021-SC-0052-WC
CEDAR LAKE PARK PLACE APPELLANT
ON APPEAL FROM COURT OF APPEALS
V. NO. 2020-CA-0731
WORKERS’ COMPENSATION BOARD
NO. WC-12-83372
PENNY BERRY; HONORABLE CHRIS APPELLEES
DAVIS, ADMINISTRATIVE LAW JUDGE;
AND WORKERS’ COMPENSATION BOARD
MEMORANDUM OPINION OF THE COURT
AFFIRMING
In this medical fee dispute, Cedar Lake Park Place (Cedar Lake) appeals
the decision of the Court of Appeals, which affirmed the Workers’
Compensation Board’s (the Board) reversal and remand of the Administrative
Law Judge’s (ALJ) opinion and order finding that Penny Berry (Berry) untimely
submitted out-of-pocket medical expenses, thereby rendering those expenses
non-compensable. The sole issue on appeal is whether Berry timely submitted
her out-of-pocket medical expenses.
After thorough review, we find no error and affirm the Court of Appeals.
I. FACTUAL AND PROCEDURAL BACKGROUND
Berry was employed on a part-time basis as a Registered Nurse at Cedar
Lake beginning in 2010. She began experiencing work-related asthma,
allergies, and pulmonary problems due to mold at Cedar Lake. Her last date of
exposure to the mold was October 26, 2012. On that day, she filed a Form 101
Application for Resolution of a Claim-Injury, alleging work-related injuries due
to the mold. After initially disputing her claim, Cedar Lake stipulated to the
work-related injuries. ALJ William Rudloff entered an order on June 27, 2013
finding Berry had work-related asthma and awarded her temporary total
disability, permanent partial disability, and medical benefits. Cedar Lake
appealed to the Board, which affirmed ALJ Rudloff’s opinion and order, then
again appealed to the Court of Appeals, which affirmed the Board’s opinion,
and then this Court, which likewise affirmed the Court of Appeals.
Correspondence between the parties continued throughout the pendency
of the appeal. The record reflects that Berry sent a letter to Cedar Lake that
included a spreadsheet containing an itemization and description of her out-of-
pocket expenses from September 14, 2010 through April 17, 2013. Berry sent
additional letters on June 18, 2013 and October 16, 2013 with the spreadsheet
attached that included up-to-date itemizations and descriptions of out-of-
pocket expenses for the year 2013. Cedar Lake confirmed receipt of the June
18, 2013 letter and spreadsheet in correspondence the same day. On
December 10, 2013, Cedar Lake stated in a letter to Berry that it had received
the spreadsheet and indicated that it would need a copy of the bills rather than
a description of them as contained in the spreadsheet. The December 10, 2013
letter from Cedar Lake is unclear which iteration of the spreadsheet Cedar Lake
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received on which date. The parties continued to discuss the necessity of
procuring and providing copies of the bills throughout 2014.
Once the appeal concluded and the matter was remanded, ALJ Rudloff
entered an amended opinion and order, from which Berry appealed to the
Board, which affirmed the ALJ in early February of 2016. Berry made another
request for reimbursement of the fees now in dispute to Cedar Lake on May 3,
2016 and sent an additional request via letter on May 31, 2016. The May 3
and May 31 letters included copies of the medical bills as reflected in the
spreadsheets that Berry had been providing throughout the course of the
litigation. It is unclear whether Cedar Lake received the letter sent by Berry on
May 3, 2016, and Cedar Lake stated in subsequent correspondence that it had
not received the May 3 letter. However, the correspondence filed by Cedar Lake
on November 8, 2019 included the May 3, 2016 letter. Additionally, in a June
17, 2016 letter, Cedar Lake acknowledged that it had received the May 31,
2016 letter. Correspondence continued for two years without resolution of the
dispute.
Berry then filed a motion to reopen her claim with an accompanying
Form 112 in June of 2018, alleging that her out-of-pocket expenses had not
been paid pursuant to her award. ALJ Chris Davis held review conferences in
July of 2018, and September of 2018, and a hearing in October of 2019. The
sole issue before ALJ Davis was the timeliness of Berry's submission of her
medical bills and requests for reimbursement of her co-pays.
3
ALJ Davis entered an opinion and order in early December 2019, finding
Berry's requests for reimbursement were not submitted until the date of the
motion to reopen on June 4, 2018, which meant the request was untimely and,
thus, non-compensable. ALJ Davis noted that “the duty to submit medical bills
and requests for co-pays [begins] when a claim is final,” and the bills and
requests for co-pay reimbursement “must have been submitted 60 days from
the date of incurrence for any bills incurred on or after February 5, 2016.”
Berry petitioned the ALJ to reconsider the opinion and order asserting that the
ALJ made a number of errors.
In late December 2019, the ALJ entered an order correcting his original
finding concerning the date of Berry's first request for reimbursement to May
31, 2016, but still found Berry’s requests for reimbursement were untimely
and, therefore, non-compensable.
Berry appealed to the Board, asserting that the record clearly indicated
that the medical bills were submitted before the claim was decided, and were,
therefore, timely. The Board vacated and remanded the ALJ’s orders due to
evidence in the record indicating timely submission of request for
reimbursement. The Board stated in its order that “the record clearly indicates
at least two spreadsheets of out-of-pocket medical expenses plus certain
invoices were sent to Cedar Lake prior to May 31, 2016.” Specifically, the
Board concluded that “the record unequivocally demonstrates that Berry’s first
request for reimbursement of her out-of-pocket medical expenses took place on
June 18, 2013.” Therefore, because the record clearly indicated that Berry had
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submitted a request for reimbursement before the ALJ’s order was final, the
Board vacated “the ALJ’s determination that Berry's out-of-pocket medical
expenses are untimely and, consequently, non-compensable and remand[ed]
the claim for additional findings.” It also vacated the ALJ’s language in the
order regarding the difficulty of ascertaining whether the expenses were
reasonable or related to her work-related injury, as the only issue was whether
the expenses were timely submitted. Further, the Board ordered the ALJ to
determine whether Cedar Lake had received the October 16, 2013 letter and to
undertake a new analysis of whether medical expenses submitted for the first
time after ALJ Rudloff’s final order was entered on February 5, 2016 were
timely and stated that whether Berry utilized a Form 114 is not determinative
on the issue of timeliness. Regarding the expenses before ALJ Rudloff’s final
order was entered on February 5, 2016, the Board determined that the sixty-
day rule contained in 803 KAR1 25:096 §11 was not applicable as established
by Garno v. Selectron U.S.A., 329 S.W.3d 301 (Ky. 2010).
The Court of Appeals then affirmed the Board. Regarding the Board’s
determination that the ALJ made findings of fact contrary to the great weight of
the evidence in the record, the Court of Appeals held as follows:
the ALJ's finding concerning the first date of request
constituted an abuse of discretion because
that finding is not supported by the record and is,
therefore, patently unfair and unreasonable. Contrary
1 Kentucky Administrative Regulation.
5
to Cedar Lake's contentions, the Board did not usurp
the ALJ's role and make a finding of fact concerning
the date(s) of requests for reimbursement but, rather,
appropriately vacated and remanded these portions of
the ALJ's orders for further—accurate—findings.2
Regarding the Board’s application of 803 KAR 25:096 § 11 and reliance on
Garno v. Selectron, the Court of Appeals held as follows:
Berry was awarded medical benefits via an
interlocutory order entered by the ALJ on June 27,
2013. Therefore, the 60-day rule set forth in 803 KAR
25:096 § 11(2) applies to medical expenses incurred
after June 27, 2013, not exclusively those incurred
after the award became final.
Aside from the error concerning the date on which 803
KAR 25:096 § 11(2) became applicable to the claim
herein, the remainder of the Board's interpretation of
controlling precedent and the 60-day submission
requirement of 803 KAR 25:096 § 11 is reasonable,
and we “generally defer to an administrative agency's
interpretation of its own regulations.” St. Joseph Hosp.
v. Littleton-Goodan, 260 S.W.3d 826, 828 (Ky. 2008).
We hold that the mandatory deadlines specified in 803
KAR 25:096 § 11 apply post-award, whether the award
is final or interlocutory, as is the case here.3
This appeal followed. We discuss additional facts as necessary below.
II. ANALYSIS
Cedar Lake claims that the Board erred by exceeding its authority to
make findings of fact, which is reserved for the sound discretion of the ALJ.
Cedar Lake further alleges that both the Court of Appeals and the Board erred
2 Cedar Lake Park Place v. Berry, 2021 WL 69031, at *3 (Ky. App. Jan. 8, 2021).
3 Id. at *4.
6
in reversing ALJ Davis’s opinion because they erred in interpreting and
applying 803 KAR 25:096 §11. More specifically, Cedar Lake asserts that the
Court of Appeals erred by: (1) misconstruing KRS4 342.020 in determining how
to interpret 803 KAR 25:096 § 11; (2) ignoring the plain language of 803 KAR
25:096 §11 altogether; and (3) upholding how the Board interpreted and
applied 803 KAR 25:096 § 11, because the Board’s interpretation conflicts with
“other regulations and does not promote judicial economy.” Lastly, Cedar Lake
contends that the Court of Appeals and the Board erred by not finding that
Berry waived any out-of-pocket expenses incurred before May 10, 2013
because she failed to follow 803 KAR 25:010 § 13(9)(a)’s mandatory
requirement that she present the bills associated with those expenses at the
Benefit Review Conference (BRC) on the same day.
While the first two contentions are well taken, it appears after thorough
review of the record that the issue of waiver is being raised for the first time
before this Court. Any argument concerning whether Berry has waived
reimbursement for her out-of-pocket expenses has never been made, and
Cedar Lake has stated by counsel on the record before the ALJ, the only issue
in this case is whether the requests for reimbursement were timely—not
whether the requests were waived. Thus, it is Cedar Lake who has failed to
preserve the issue. We have long held that a “new theory of error cannot be
raised for the first time on appeal.”5 Because Cedar Lake has failed to preserve
4 Kentucky Revised Statute.
5 Springer v. Commonwealth, 998 S.W.2d 439, 446 (Ky. 1999).
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this alleged error, we decline to address whether Berry waived any out-of-
pocket expenses incurred before May 10, 2013.
(1) Standard of Review
The Court of Appeals must “correct the Board only where the Court
perceives the Board has overlooked or misconstrued controlling statutes or
precedent, or committed an error in assessing the evidence so flagrant as to
cause gross injustice.”6 “The function of further review in our Court is to
address new or novel questions of statutory construction, or to reconsider
precedent when such appears necessary, or to review a question of
constitutional magnitude.”7 “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.”8
(2) The Board did not err in remanding for additional findings of fact.
It is incumbent upon the Board “to carry out the same functions as an
intermediate court reviewing the decisions of a court of original jurisdiction, to
perform the error correcting function normally assigned to the Kentucky Court
of Appeals, lacking only the power of constitutional review.”9 The Board must
determine whether the ALJ’s “order, decision or award is clearly erroneous on
6 W. Baptist Hosp. v. Kelly, 827 S.W.2d 685, 687–88 (Ky. 1992).
7 Id. at 688.
8 Ford Motor Co. v. Jobe, 544 S.W.3d 628, 631 (Ky. 2018) (citing Bowerman v.
Black Equip. Co., 297 S.W.3d 858, 866 (Ky. App. 2009)).
9 W. Baptist Hosp., 827 S.W.2d at 687.
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the basis of the reliable, probative and material evidence contained in the
whole record,” or “arbitrary or capricious or characterized by abuse of
discretion or clearly unwarranted exercise of discretion.”10 The Board “shall
not reweigh the evidence and substitute its judgment for that of the ALJ with
regard to a question of fact.”11 However,
if the ALJ has made all necessary findings to resolve
the issue at hand and the Board has erred in
remanding for additional, unneeded findings that
would be of no additional value in resolving the issues
in the case, if for no other reason than judicial
economy alone, that decision, just as any other, is
subject to review and reversal by the appellate
courts.12
Thus, the converse is true: when the ALJ has not made all findings of fact
necessary to resolve the issue at hand, then the Board is well within its
authority to remand for additional findings.
In the instant case, the Board determined that the ALJ made findings of
fact that were clearly erroneous. The record clearly demonstrates that Berry
submitted her first request for reimbursement on June 18, 2013. ALJ Davis’s
determination that she did not submit her first request for reimbursement until
June 4, 2018 is against clear and convincing evidence in the record. Contrary
10 KRS 342.285 (2)(d)-(e).
11 Ira A. Watson Dep't Store v. Hamilton, 34 S.W.3d 48, 52 (Ky. 2000).
12 Tryon Trucking, Inc. v. Medlin, 586 S.W.3d 233, 238 (Ky. 2019).
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to Cedar Lake’s assertion, the Board did not make findings of fact beyond its
authority. The Board did not “not reweigh the evidence and substitute its
judgment for that of the ALJ with regard to a question of fact.”13 It merely
examined the record and determined that the ALJ erred in making its finding of
fact as to the date of the first submission of Berry’s request for reimbursement.
The Board did not err in doing so.
Whether the remainder of Berry’s requests for reimbursement were
timely is still an open question. Additional findings of fact are necessary to
determine the timeliness of those requests. Only the ALJ has the ability to
make those findings. As a result, remand for additional findings of fact is
necessary and the Board did not err in so ordering.
(3) The Board did not misconstrue controlling statutes or precedent.
Therefore, the Court of Appeals did not err in affirming the Board’s
opinion.
This Court recently considered at which point in the litigation process
803 KAR 25:096, § 11’s sixty-day requirement applies, and held:
the regulatory scheme governing workers’
compensation claims anticipates that medical
expenses will be provided to the employer pre-award
and throughout the litigation of the claim. To interpret
the sixty-day submission requirement found in 803
KAR 25:096, § 11 as applying pre-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. Accordingly, when
viewed in the context of the regulatory scheme, 803
KAR 25:096, § 11's application only post-award best
13 Ira A. Watson, 34 S.W.3d at 52.
10
effectuates the intent of the Commissioner and
prevents an absurd result.14
We noted in Wonderfoil15 that Garno’s holding16 that requests for
reimbursement must be submitted within sixty days of the entry of an
interlocutory order was consistent with our interpretation of the regulation.
Our holding in Wonderfoil makes clear that 803 KAR 25:096 § 11 applies only
post-award.17
Contrary to Cedar Lake’s assertion, the Court of Appeals did not
misconstrue Garno. As we noted in Wonderfoil, “Garno decided whether the
sixty-day time frame applied post-interlocutory award.”18 Though the litigants
did not have the benefit of our guidance in Wonderfoil, that opinion makes it
unequivocally clear that the sixty-day requirement contained in 803 KAR
25:096 § 11 begins once an interlocutory award or final order is entered, but
may be tolled for good cause shown.19 The Court of Appeals did not err in its
interpretation of that rule.
Further, contrary to Cedar Lake’s argument, the Court of Appeals did not
err in its interpretation of KRS 342.020 or R.J. Coleman R.R. Constr. v.
14 Wonderfoil, Inc. v. Russell, 630 S.W.3d 706, 711 (Ky. 2021)
15 Id. at 713.
16 Garno, 329 S.W.3d at 303.
17 Wonderfoil, 630 S.W.3d at 711.
18 Id. at 713.
19 Id.
11
Haddix20 by determining that medical expenses are not compensable until
either an interlocutory award or final order are entered. As this Court
explained in Wonderfoil, holding that the sixty-day requirement contained
in 803 KAR 25:096 § 11 begins once an interlocutory award or final order is
entered “is a natural and logical extension of Haddix.” 21 In Haddix, this Court
held that KRS 342.020 “applies to medical statements received by an employer
after an ALJ has determined that said bills are owed by the employer.”22
Therefore, the Court of Appeals did not err in determining that medical
expenses are not compensable until either an interlocutory award or final order
are entered under Haddix or KRS 342.020.
The Board’s determination that the sixty-day rule contained in 803 KAR
25:096 § 11(2) is not applicable to Berry’s requests for reimbursement made
before February 5, 2016 is consistent with this Court’s Opinion in Wonderfoil.
However, as the Court of Appeals correctly held, ALJ Rudloff entered an
interlocutory order awarding benefits to Berry on June 27, 2013. Therefore,
though the Board’s interpretation of 803 KAR 25:096 § 11(2) was correct, its
application of that interpretation to the facts was not.
20 864 S.W.2d 915 (Ky. 1993).
21 Wonderfoil, 630 S.W.3d at 712.
22 864 S.W.2d at 918.
12
We affirm the Court of Appeals and hold as it did that “the 60-day rule
set forth in 803 KAR 25:096 § 11(2) applies to medical expenses incurred after
June 27, 2013, not exclusively those incurred after the award became final.”23
As a result, on remand the ALJ must determine whether any requests for
reimbursement submitted for the first time after June 27, 2013 were timely,
excepting those requests procedurally waived. Further, because the record
clearly demonstrates that the first request for reimbursement was submitted
on June 18, 2013—before the interlocutory award was entered on June 27,
2013—the 60-day rule set forth in 803 KAR 25:096 § 11(2) is not applicable to
those requests.
III. CONCLUSION
Based on the foregoing, we affirm the Court of Appeals.
All sitting. All concur.
23 Cedar Lake Park Place, 2021 WL 69031 at *4.
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COUNSEL FOR APPELLANT:
Joseph C. Klausing
Priscilla C. Paige
O’Bryan Brown & Toner, PLLC
COUNSEL FOR APPELLEE, PENNY BERRY:
Wayne C. Daub
Wayne C. Daub Law Office
ADMINISTRATIVE LAW JUDGE:
Hon. Chris Davis
WORKERS’ COMPENSATION BOARD:
Michael Wayne Alvey,
Chairman
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