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Minnesota Supreme Court Decision Clarifies Correct Application of Workers' Compensation Treatment Parameters

April 25, 2019

by Emily LaCourseChristine Tuft, and Richard Nelson

On April 24, 2019, the Minnesota Supreme Court issued a decision clarifying employers and insurers’ ability to utilize defenses under the Treatment Parameters. In Johnson, William v. Darchuks Fabrication, Inc., File No. A18-1131 (April 24, 2019), the Minnesota Supreme Court, in a case of first impression, ruled that employers and insurers can apply the Treatment Parameters even when contesting a diagnosis, as long as they do not deny all obligations to pay compensation for the underlying injury. This decision reversed the determination of the trial court judge and WCCA in this matter. It also distinguished prior WCCA determinations, which had been interpreted as rejecting Treatment Parameter arguments when the employer and insurer were contesting one particular diagnosis, but not arguing that the underlying injury was denied or had resolved. This decision affords employers and insurers the opportunity to apply the Treatment Parameters on a broader basis than previously allowed. Additional details regarding the case can be found below. The appeal on behalf of the employer and insurer was handled by attorneys Emily LaCourse, Christine Tuft, and Richard Nelson in our office. 

The employee, Mr. Johnson, injured his right ankle in September 2002, while working for Darchuks Fabrication, insured by Harleysville Insurance. The injury was admitted and benefits were paid to and on behalf of Mr. Johnson. After a short period of time, Mr. Johnson developed complex regional pain syndrome (“CRPS”). This diagnosis was also initially admitted, and the insurer paid for significant medical treatment. As of 2005, after receiving various forms of alternative treatment, Mr. Johnson’s treatment primarily consisted of a medication regimen that included opioid medication. In 2016, due to concerns about the ongoing use of opioid medications, the employer and insurer pursued an independent medical examination to review Mr. Johnson’s condition and the appropriateness of the medication regimen. The IME opined that Mr. Johnson no longer had CRPS, that the use of ongoing narcotics was not in compliance with the Treatment Parameters, and recommended that Mr. Johnson be weaned off narcotics. Based on that report, a letter was sent to Mr. Johnson’s physician indicating treatment for Mr. Johnson’s CRPS diagnosis was denied. Further, the letter requested that the treating physician begin weaning Mr. Johnson from the opioid mediation and comply with the Treatment Parameters governing long-term use of opioid medications. Minn. R. 5221.6110. When the treating physician did not respond, the employer and insurer ceased paying for medication reimbursement. Mr. Johnson subsequently filed a Medical Request seeking payment of his medications. The employer and insurer denied payments, contending that Mr. Johnson’s CRPS has resolved, that the treatment was not reasonable or necessary to cure and relieve the effects of the injury, and that his continued treatment with opioid medications was not compliant with the Treatment Parameters.

The case went to a Hearing before Compensation Judge Hartman, who found that Mr. Johnson’s CRPS had not resolved, and that in denying that Mr. Johnson had CRPS, the employer and insurer had in effect “denied liability” for Mr. Johnson’s injury. Consequently, he denied application of the Treatment Parameters. The Workers’ Compensation Court of Appeals (“WCCA”) affirmed. Citing Schulenburg, Oldenburg, and Mattson, the WCCA found that challenging even one component of an otherwise admitted injury is akin to a denial of liability, and, in doing so, and employer and insurer lost the ability to apply the Treatment Parameters. 
The Supreme Court (Justice Chutich writing for the majority) reversed the decision of the WCCA. The Court analyzed the meaning of Minn. R. 5221.6020, subp. 2, which governs the application of the Treatment Parameters. That rule states that the Treatment Parameters “do not apply to treatment of an injury after an employer has denied liability for the injury.” The Court examined the specific language of this rule and concluded that under the Workers’ Compensation Act, the phrase “liability for the injury” refers to the “employer’s obligation to pay statutory benefits for personal injuries that are covered by the workers’ compensation act.” Therefore, the Court found that when an employer and insurer claim that they have no obligation to pay for an injury, the Treatment Parameters do not apply. However, in situations such as this case, where the employer admits that the employee sustained a work injury, and continues to admit that the employee has not fully recovered from an injury, the employer has not “denied liability” for the injury so as to prevent defenses based upon the Treatment Parameters. In other words, the Court found that employers and insurers can contest a diagnosis and alternatively assert defenses under the Treatment Parameters, as long as they do not deny all obligations to pay compensation for the underlying injury. 

Impact: The Treatment Parameters lay out the appropriate types of and course of treatment for various work-related injuries. If a request for medical treatment is not in compliance with the Parameters, an employer and insurer can deny approval of or payment for the requested treatment based upon the Parameters. The rules, as interpreted in prior case law from the WCCA, have been interpreted as establishing that the Treatment Parameters do not apply when primary liability for an injury has been denied or when the employer and insurer have argued that the employee has fully recovered from a work injury, meaning they have no ongoing obligation to pay benefits for an injury. The facts of this case are unique in that a specific diagnosis only was challenged, while liability for the injury itself continued to be admitted. We now know that under these circumstances, the Treatment Parameters can be used as a defense to medical treatment for the underlying injury. In other words, as long as the employer and insurer are not denying all obligations to pay compensation for the work injury, the Treatment Parameters do apply and should be looked to for an additional defense to requested medical treatment.

Click here to read the Supreme Court’s Opinion.

Contact any of the Arthur Chapman Workers' Compensation attorneys to discuss this ruling.