A bill introduced in Colorado’s legislature makes a package of changes to the Workers’ Compensation Act ranging from procedural clarifications to changes that overturn appellate court decisions.
The more significant clarifications to workers’ compensation law in House Bill 1154 include making guardian and conservator services a benefit employers have to cover if it is reasonable and necessary after a work-related injury. It also limits when benefits are apportioned based on a previous injury.
The apportionment section overrules two previous Court of Appeals decisions. Lawyers who represent employees say it clarifies a change to the Workers’ Compensation Act predating the cases, and the lawyers felt the Court of Appeals decisions didn’t correctly apply the law.
The section of the bill addressing coverage of guardian and conservator services overturns a third Court of Appeals case.
Bill sponsor Rep. Kevin Van Winkle, the House’s Republican assistant minority leader, said the bill’s intent to reduce litigation and make sure workers receive compensation benefits efficiently sold him on the legislation. He added with a bill as technically complicated as 1154, he looked for assurance that the bill’s provisions are well thought out.
“We want to ensure everyone that needs to be at the table was at the table and that they were able to have the true open discussions in order to try to find that middle ground on issues,” he said. “This isn’t something that professionally I’ve ever been fully engaged in, in a full-time job, so I need to trust the people who do this work on a daily basis.”
House Bill 1154 came out of a working group made up of Pinnacol Assurance, the Colorado Self Insurers Association and the Colorado Workers’ Compensation Education Association. The group meets each each year to discuss possible legislative proposals and gauge how they might fare in the current Capitol.
The working group is a collaboration between stakeholders that often find themselves on opposite sides of workers’ compensation cases. Pinnacol deputy general counsel Harvey Flewelling represented the company and other respondents in two of the cases addressed by the bill: Nanez v. Industrial Claim Appeals Office and Hutchison v. Industrial Claim Appeals Office.
Current WCEA president Mark Elliott said the work group started meeting each year to discuss legislative proposals after former Gov. Bill Ritter insisted the stakeholder groups compromise for him to support any workers’ compensation legislation.
Michael Kaplan of Kaplan Morrell, who represented Brian Nanez in his case decided by the Court of Appeals in 2018, said the Workers’ Compensation Act was designed to create a no-fault process for injured workers to get compensation as a result of work-related injuries. As a compromise, workers give up their right to sue their employers for actions or negligence that may have caused their injuries.
In the Nanez case, Kaplan’s client suffered a traumatic brain injury after a three-story fall at his job with Mechanical & Piping. The injury impaired his ability to make decisions for himself, and a probate court appointed a guardian and conservator to make financial and everyday life decisions.
Kaplan and his co-counsel, Bryan Gwinn, argued Nanez’ insurance carrier should cover the services because their need arose as a result of his injury. But an administrative law judge decided the conservator’s financial decision assistance would not cure Nanez’s physical condition, a requirement for workers’ compensation coverage of treatment. The ALJ also decided the guardianship wasn’t reasonable and necessary because the same services could have been provided by a nurse case manager.
The Industrial Claim Appeals Office and the Court of Appeals upheld the ALJ’s decision. The Supreme Court decided not to take the case.
Kaplan said employees injured at work shouldn’t have to bear the expensive costs of guardians and conservators. “When you lose that kind of a battle and you have the ability to change things, you’ve got to attack it legislatively,” Kaplan said.
House Bill 1154’s section limiting benefit apportionment also addresses Court of Appeals precedents, Hutchison v. Industrial Claim Appeals Office and Duncan v. Industrial Claim Appeals Office. It says employers can’t reduce medical, temporary partial disability or temporary total disability benefits based on a preexisting condition that affects the same body part or function.
Limiting apportionment isn’t new to workers’ compensation law. R. Mack Babcock, founder of the Babcock Law Firm and member of the WCEA, said that section of House Bill 1154 clarifies a previous change to the Workers’ Compensation Act limiting apportionment that lawyers representing workers felt the two Court of Appeals decisions ignored. Under workers’ compensation law, a new claim can arise if a workplace accident or injury aggravates an employee’s preexisting condition, but Babcock said apportionment arguments made in court cases ate away at protections for workers’ compensation benefits.
“It wasn’t a change to the Workers’ Compensation Act,” Babcock said. “It wasn’t both sides negotiating and [agreeing to] reduce benefits for injured workers. It was being done through arguments in front of judges and court decisions.”
The lawyers representing different parties in workers’ compensation law acknowledged they don’t necessarily have the same opinions of how fair it is overall to workers versus employers and insurance companies. So it’s no small feat for the groups to come up with legislative proposals they can all live with. Harvey Flewelling, Pinnacol’s deputy general counsel, said Pinnacol has a neutral view of House Bill 1154 overall and supports some changes that have the potential to reduce litigation.
One compromise with that possibility lowers an employee’s impairment percentage that determines cap on temporary and permanent disability benefits from 25% to 19%. The impairment level triggers a $94,330.19 cap on benefits, and under current law, impairment over 25% carries a $188,658 cap on benefits. A list of legislative talking points on House Bill 1154 Elliott provided to Law Week says there tends to be litigation for employees between 19% and 25% impairment to make them eligible for the higher cap, so lowering it can reduce litigation.
“Maybe some business owners might think this [bill] is unreasonable because [they] think it’s going to cost more money,” Flewelling said. “That’s up to us in this circumstance we don’t believe that this will have any significant impact on insurance rates, and that’s obviously important for us.”
—Julia Cardi