ADIA Personnel Agency v. Workmen's Compensation Appeal Board

CRAIG, Judge.

This interlocutory appeal by permission is from an order of the Workmen’s Compensation Appeal Board quashing as interlocutory an appeal to it by ADIA Personnel Agency, the employer, and CNA Insurance Company from a referee’s refusal to grant a supersedeas of the employer’s obligation to pay medical expenses pursuant to section 306(f) of The Pennsylvania Workmen’s Compensation Act, Act of June 2, 1915, P.L. 736, as amended, 11 P.S. § 531.

On May 27, 1986, the employer filed a petition for termination of compensation being paid to claimant Samuel A. Coleman. The claimant filed an answer asserting that the employer violated the Act because it had refused to pay certain medical expenses, on the ground that those expenses were not reasonable and necessary to his continued treatment. On May 18, 1987, the employer filed a petition to review those medical expenses under section 306(f)(2)(ii) of the Act, 77 P.S. § 531(2)(ii).

Additionally, the employer requested that the referee grant a supersedeas of payments of the challenged medical bills. In response, the referee issued by letter the following order, which states in relevant part:

I have decided that I will not enter an interlocutory order either granting or denying supersedeas because to do so would imply that I believe that Section 306(f) empowers the referee to grant or deny a discretionary supersedeas. It is my opinion that the provisions of Section 306(f) clearly do not permit a supersedeas on the mere filing of the petition (such as the so-called automatic supersedeas allowed under Section 413(a) prior to Baksalary), and there is no power granted to the referee, express or implied, to enter a discretionary supersedeas order.

The employer appealed to the board and, while the appeal was pending, paid the amount of the medical expenses in controversy into an interest-bearing escrow account. On November 7,1988, the board quashed the appeal as interlocutory.

On September 18, 1989, the board denied the employer’s subsequent petition for rehearing and reaffirmed its previous order dismissing the appeal as interlocutory. However, on October 12, 1989, the board then granted the employer’s request to certify the substantive question as one meriting an interlocutory appeal by permission.¹ This court then granted the employer’s petition for permission to appeal on November 8, 1989.

The issue before this court is whether a supersedeas may be granted for medical expenses, and if not, whether such omission from the Act constitutes a denial of due process under the state and federal constitutions.

Section 306(f)(2)(ii) provides:

The employer shall have the right to petition the department for review of the necessity or frequency of treatment or reasonableness of fees for services provided by a physician or other duly licensed practitioner of the healing arts. Such a petition shall in no event act as a supersedeas, and during the pendency of any such petition the employer shall pay all medical bills if the physician or other practitioner of the healing arts files a report or reports as required by subparagraph (I) of paragraph (2) of this subsection.

Although section 306(f)(2)(H) specifies that the filing of the petition itself does not effect an automatic supersedeas, we must decide whether it authorizes a discretionary supersedeas as to payment of medical expenses.

Section 443 of the Act, 77 P.S. § 999,² which deals with reimbursement from the supersedeas fund, provides:

(a) If, in any case in which a supersedeas has been requested and denied under the provisions of section 413 or section 430, payments of compensation are made as a result thereof and upon final outcome of the proceedings, it is determined that such compensation was not, in fact, payable, the insurer who has made such payments shall be reimbursed therefor.

Section 413 of the Act, 77 P.S. §§ 771-774.2, pertains to modification or setting aside an agreement for fraud, modification due to a change in disability, amendment of petitions, the effect of a petition to terminate or modify an agreement, the effect of an employer’s improper suspension, decrease or termination of compensation benefits, and the right of an employer to suspend compensation where the employee has returned to work at previous or increased earnings and a petition to terminate or modify has been filed.

Section 430 of the Act, 77 P.S. § 971, pertains to the effect of an appeal on a lien of judgment.

However, no section within the Act authorizes a discretionary supersedeas as to payment of medical expenses. Furthermore, a policy of cutting medical aid before an adjudication could seriously impair a claimant’s right to-receive immediate treatment. Therefore, we must conclude that section 306(f) does not authorize a discretionary supersedeas for such expenses.

Although a referee’s decision to grant or deny a supersedeas is not appealable, 77 P.S. § 774, there is the remedy providing for reimbursement from the supersedeas fund under section 443. 2 A. Barbieri, Pennsylvania Workmen’s Compensation § 6.17(3), at 53 (1975). As expressed by Senior Judge Barry in the case of Insurance Company of North America v. Workmen’s Compensation Appeal Board (Kline and Packard Press), 137 Pa.Commonwealth Ct. 393, 586 A.2d 500 (1991), section 443 authorizes reimbursement of medical expenses to an insurer pursuant to a judicial determination that such expenses should not have been paid.

Because an insurer can be reimbursed for all unnecessarily paid medical expenses, there is no need to address the issue of due process.

Accordingly, the denial of the supersedeas is affirmed.

DOYLE, J., filed a concurring opinion.

ORDER

NOW, January 28, 1991, the denial of the supersedeas in the above-captioned matter is affirmed.

1 . See Pa. R.A.P. 1311.

There is a procedural difficulty with this case. The Board’s order of September 18 quashed the appeal as interlocutory; it thus never reached the merits of whether the supersedeas petition should have been denied. The controlling question of law it later certified, however, was the merits of the denial of the supersedeas petition. Because our order permitted the appeal of the question certified we shall, in the interest of judicial economy, decide the substantive question and, accordingly, we will treat the Board’s order as having actually dismissed the appeal to it on the merits.

2 . Section 443 was added by Section 3 of the Act of February 8, 1972, P.L. 25 (Act 12).