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Iowa Court of Appeals Rules on Workers’ Compensation Matters

• Mar 01, 2021

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Legal Update by Attorney Alison Stewart and Law Clerk Jordan Gehlhaar

The Iowa Court of Appeals recently addressed workers’ compensation benefits, causation, and penalties in Regional Care Hospital Partners Inc. v. Marrs. Claimant Marrs injured her back and neck while working as a nurse and was diagnosed with thoracic and high-lumbar sprains. Four months following the accident she was released to return to light duty work. The employer did not offer light duty work and stopped payment of medical expenses and temporary benefits. The Claimant continued to have pain, which was attributed to a degenerative disc condition of the cervical spine. A cervical fusion procedure was recommended.

Three doctors provided opinions on the work relatedness of Claimant Marrs’s condition. Doctor Abernathey concluded she reached MMI ( Maximum Medical Improvement) six months following the accident and the surgery was not work related. Doctor Kaspar, who had treated Claimant through her private insurance, determined the work incident either caused the injury or materially aggravated her pre-exiting degenerative condition. Doctor Harbach, who completed an IME (Independent Medical Examination), opined Claimant had not reached MMI and would have a permanent impairment as a result of the work injury.

Following a hearing, a deputy commissioner awarded healing period benefits and ordered the employer to reimburse medical expenses and pay a penalty of $50,000. On appeal, the commissioner affirmed healing period benefits but reduced the penalty to $39,000. The district court affirmed. Regional challenged causation, the weekly benefit rate, and the assessment of penalty benefits.

The Court of Appeals held that causation was properly attributed to the work injury. The commissioner properly concluded that Dr. Abernathy’s opinion was unpersuasive because it provided “no explanation whatsoever.” Further, the commissioner properly excluded a two-week outlier payment period from the benefit calculation in which the Claimant worked 54.75 hours as opposed to the usual 62.5. Under Iowa Code § 85.36(6) this was the “closest previous week with earnings that fairly represent[ed] the employee’s customary earnings.”

Penalty benefits were also affirmed on appeal. Under Iowa Code § 86.134(a), the commissioner may award benefits up to 50 percent of the amount denied, delayed, or terminated without reason, probable cause, or excuse. Regional care ceased payment when claimant was released for light duty work, relying on Dr. Abernathey’s opinion and claiming she did not return to work for unrelated reasons. However, the opinion was rendered months after benefits ceased and there was no evidence Regional communicated its denial to Marrs. The court found $39,000 to be an appropriate penalty, given roughly $80,000 in benefits were unpaid at the time of the hearing.

 

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