WCAB Changes Its Mind Again

Almaraz v. Environmental Recovery Services, Inc. (2009) 74 Cal. Comp. Cases __: The WCAB en banc has done a 180 degree turn yet again. In a decision reminiscent of Pendergrass and Baglione, the WCAB has changed its mind, or at least a majority of the Commissioners have. On February 3, 2009 the WCAB en banc issued its decision in Almaraz/Guzman turning the California Workers’ Compensation community upside down by, in essence, throwing out the AMA Guides as a required element of a permanent disability rating. The decision sparked outrage and an unprecedented letter from the Director of the Department of Industrial Relations requesting the case be reconsidered. The WCAB listened. In an Opinion which tries to please everyone and make sense out of the senseless the four WCAB Commissioners (Miller, Cuneo, Lowe and Aghazarian) have changed their minds.

What Stayed the Same

The Commissioners affirmed most of the earlier Opinion by holding:

1. Labor Code section 4660, subdivision (c) unambiguously means that a permanent disability rating established by the Schedule is rebuttable.

2. The party disputing that rating has the burden of proof to rebut the rating.

3. A party can rebut any element of the rating. This includes the whole person impairment (WPI) under the AMA Guides. It also includes the future earnings capacity (FEC) adjustment addressed under Ogilvie and the occupation group number and adjustment. It is unclear whether the age modification element can be rebutted.

What Changed:

The big change in the WCAB’s Opinion is that “it is not permissible to go outside the four corners of the AMA Guides” to rebut the WPI portion of the scheduled rating. Instead, parties are limited to using other sections of the AMA Guides which more accurately reflect the injured employee’s impairment.

The WCAB explicitly rejected its earlier interpretation that the WPI could be rejected by a showing that the rating is “inequitable, disproportionate, and not a fair and accurate measure of the employee’s permanent disability.” It also warned that its decision “does not permit a physician to utilize any chapter, table, or method in the AMA Guides simply to achieve a desired result.” It also further explained that the physician must explain and justify leaving the standard methodology.

In changing its holding, the WCAB felt persuaded that its earlier Opinion did not promote “consistency, uniformity, and objectivity” as required under Labor Code section 4660, subdivision (d). It also felt that the wording of subdivision (b)(1) providing that “the ‘nature of the physical injury or disfigurement’ shall incorporate the descriptions and measurement of physical impairment published in the [AMA Guides]” required that the AMA Guides be the only source of a WPI regardless of rebuttal.

What Is Just Entertaining

The emotion evoked by the earlier Opinion the WCAB was evident to anyone in the workers’ compensation community. It obviously sparked some heated briefing. After finishing its real Opinion, the WCAB then spent almost eight pages responding to some of the “Other Issues Presented by the Parties and Amicus Curiae.” Any student of the WCAB should spend some time reviewing these arguments. [My favorite is the one in which the WCAB felt compelled to title its response “Our Current Opinion Is Not An Invalid Underground Regulation.”]

The Dissent

Three Commissioners (including longtime defense attorney Alfonso Moresi) dissented and voted to affirm the earlier decision. To give these Commissioners credit, their Opinion persuasively argues that the way a scheduled rating is arrived at and the standard used to rebut it are two different matters. Their Opinion is a brief restatement of the February 3, 2009 en banc Opinion.

In Practice

The WCAB majority suggested a very simple procedure to be employed to rebut the WPI. After reports by the primary treating physician and any Agreed or Qualified Medical Examiners, the party (applicant or defendant) wishing to rebut the WPI should request supplemental reports and/or depose the physician(s). Thereafter, if allowed under the Labor Code another medical legal opinion may be necessary. That opinion must be substantial medical evidence. Ultimately, the trial judge as trier of fact will have to decide based on the evidence presented at trial the correct WPI to use .

In reality, the WCAB’s Opinion extremely limits the ability of a party to rebut the WPI portion of a rating. Injured workers and defendants are now limited to the AMA Guides themselves to rebut WPI assessments. However, each section of the AMA Guides was written by different authors using different methodologies. How one section can be applied to different regions of the body remains to be seen.

What's Next

The net effect of this decision, if it holds, will be arguments about the correct application of the AMA Guides. Challenges to the WPI based on Almaraz should become selective and rare. They should also become brief and inexpensive. The use of experts and alternative assessment systems should be nearly eliminated.

The parties in Almaraz and Guzman now have an opportunity to once again request reconsideration. Their more likely path will be a petition for writ of review to the Courts of Appeal. What the Courts of Appeal (and ultimately the California Supreme Court) will do with this tangle of statutory revisions and interpreting regulations is anyone’s guess. However, recent history suggests, that it be a restrictive interpretation favorable to employers.

Opinion filed September 3, 2009.

Heggeness,Sweet, Simington & Patrico, A.P.C

WCAB Changes Its Mind Again