California: SB 863 and Benson

 By Robert G. Rassp, Esq.

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Call me weird, obsessed, bored, or deeply disturbed but recently while I was on my almost daily four-mile hike in the hills of Porter Ranch, I was thinking about how Benson (Benson vs. WCAB (2009) 170 Cal. App.4th 1535, 74 Cal. Comp. Cases 113 [74. Cal. Comp. Cases 113]) would apply during the SB 863 era we are now entering into. There is no case law on the issue to be discussed here but there will be soon enough. But first, some history is necessary.

In 2004, as part of SB 899, the legislature enacted Labor Code section 4660(d) [4660], which spawned lots of litigation over the question of which Permanent Disability Rating Schedule (PDRS) applies in a given case. Labor Code section 4660(d) says you use the 2005 PDRS and not the 1997 PDRS unless one of three things applies: the injured worker was declared permanent and stationary prior to 1/1/05, a medical report indicates the existence of permanent disability prior to 1/1/05, or the claims administrator was required to send a notice regarding permanent disability prior to 1/1/05. We have conflicting Court of Appeal decisions on the subject. See, Vera v. Workers’ Comp. Appeals Bd. (2007) 154 Cal. App. 4th 996, 65 Cal. Rptr. 3d 151, 72 Cal. Comp. Cases 1115 [72 Cal. Comp. Cases 1115] and compare to Genlyte Group v. Workers’ Comp. Appeals Bd. (Zavala) (2008) 158 Cal. App. 4th 705, 69 Cal. Rptr. 3d 903, 73 Cal. Comp. Cases 6 [73 Cal. Comp. Cases 6].

In SB 863, this issue is completely avoided – everything is simply dictated by the date of injury. But the problem is that the permanent disability rating string for a pre-2013 date of injury is different from a rating string for a 2013 or later date of injury. How does apportionment under Labor Code Section 4663 [4663] work between an injury occurring prior to 1/1/13 and one that occurs on or after 1/1/13? If there is overlapping body parts between the two injuries, how are they combined in order to have a final permanent disability rating? Do you apportion WPI ratings before you adjust for DFEC or the 1.4 adjustment factor and then adjust for occupation and age?

So for example, you have a 55-year-old electrician (occupational group 380) sustain an admitted knee and lumbar spinal injury on August 31, 2012 (or any date between 1/1/05 and 12/31/12) and another injury to the lumbar spine in 2013 or later (CT or specific). How do you do a rating if the AME or PQME, and the treating physician agree:

  • The injured worker has a total knee replacement that has a “fair” result (AMA Guides Tables 16-35 and 16-33) and rates a 20% WPI and is caused solely by the specific injury in 2012.
  • The lumbar spine using the Range Of Motion method rates 20% WPI and is caused 25% due to the 2012 injury and 75% due to the 2013 injury.

For injuries occurring between1/1/05 and 12/31/12, each WPI rating would be multiplied times one of eight DFEC adjustment factors and then adjusted for the injured worker’s occupation and age as of the date of injury. See the 2005 PDRS, Table A and the instructions for DFEC adjustments on pages 1-5 through 1-7. In our example, the 2012 injury would result in the knee rating with the DFEC of Rank 2, which is a 14% increase so the DFEC adjustment Rank 2 would be [20% WPI x 1.14] then adjusted for occupation and age:

     17.05.10.08 – 20 – [2]23 – 380I – 31 – 36

If the lumbar spinal impairment (ROM) was solely caused by the 2012 injury, the DFEC adjustment factor is a Rank 5 or 27% increase of the WPI [20% WPI x 1.27]:

     15.03.02.02 – 20 – [5]25 – 380H – 30 – 35

But since 75% of the lumbar spinal impairment is due to the 2013 injury, there is no DFEC adjustment factor from the 2005 PDRS. Instead, there would be the 1.4 adjustment factor from SB 863 Labor Code Section 4660.1 [4660.1] and then apportionment would be 25% to the 2012 DOI and 75% due to the 2013 DOI:

     15.03.02.02 – 20 – (20 x 1.4) 28 – 380H – 34 – 39

The 1.4 adjustment factor mandated in SB 863 for injuries occurring on or after 1/1/13 would apply for the entire WPI rating for the lumbar spine and then apportionment would apply between the injuries. Unless and until there is case law to the contrary, part of the lumbar spine rating for the 2012 date of injury may be subject to the 1.4 adjustment factor since you do not do apportionment until after the rating string has been completed and you know what the actual permanent disability rating is before apportionment for non-industrial factors and between the injuries in accordance with Benson.

Essentially, SB 863 creates a third level of apportionment – the first one for consideration of non-industrial factors, the second one based on Benson, and a third new level — apportionment between a pre-2013 injury and a post-2013 injury with overlapping parts of body injured between them. Do you think the WCAB or appellate courts will require apportionment of WPI instead of permanent disability to avoid the use of the 1.4 adjustment factor for the part of permanent disability that is apportioned to a pre-2013 date of injury?

In our example, assume that the evaluating and treating physicians agree that there is no apportionment to non-industrial factors but 25% of the lumbar spinal impairment is directly caused by the 2012 injury and 75% of the impairment is caused by the 2013 injury:

  • 25% (39) = 10% PD apportioned to 2012 DOI
  • 75% (39) = 29% PD apportioned to 2013 DOI

How are both lumbar spine and knee permanent disability ratings combined when they overlap between the 2012 and 2013 dates of injury? Remember, apportionment of disability is a legal conclusion based on valid medical evidence. See, Labor Code section 4663(b) and (c). Also see Brodie v. Workers’ Comp. Appeals Bd. (2007) 40 Cal. 4th 1313, 57 Cal. Rptr. 3d 644, 156 P.3d 1100, 72 Cal. Comp. Cases 565 [72 Cal. Comp. Cases 565]; Marlene Escobedo vs. Marshalls (2005) 70 Cal. Comp. Cases 604 at 621 [70 Cal. Comp. Cases 604] (WCAB en banc decision); and E.L. Yeager Construction v. W.C.A.B. (Gatten) (2006) 145 Cal. App. 4th 922, 52 Cal. Rptr. 3d 133, 71 Cal. Comp. Cases 1687 [71 Cal. Comp. Cases 1687]. You do not apportion WPI ratings, you apportion permanent disability ratings in accordance with Labor Code sections 4663, 4664 [4664], or both. So once you complete the rating string for each WPI rating, then you apply principles of apportionment under the Escobedo, Gatten, and Benson cases.

So the final rating in our example for the 2012 date of injury looks like this:

     Knee: 100% (17.05.10.08 – 20 – [2]23 – 380I – 31 – 36) = 36%

     Back: 25% (15.03.02.02 – 20 – (20 x 1.4) 28 – 380H – 34 – 39) = 10% PD

     36% COMBINED 10% = 42% PD

The final rating for the 2013 date of injury looks like this:

     75% (15.03.02.02 – 20 – (20 x 1.4) 28 – 380H – 34 – 39) = 29% PD

The injured worker under Benson would receive two awards — a 42% permanent disability Award for the knee and lumbar spine for the 2012 date of injury, and a 29% Award for the lumbar spine for the 2013 date of injury.

We no longer have to argue and litigate the issue of which PDRS applies in a case with a moving target of a permanent and stationary date, an indication of permanent disability, or a notice requirement. Instead, we will be litigating whether the 1.4 adjustment factor that replaces the eight DFEC Ranks applies to pre-2013 dates of injury when there is permanent disability that involves a body part injured before and after 1/1/13.

All of this is subject to judicial and appellate interpretation that we look forward to soon. Meanwhile, you are probably thinking, “This guy needs to get a life!” Well, at least I am getting good exercise in Porter Ranch while thinking about these things.

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The Lawyer’s Guide to the AMA Guides and California Workers’ Compensation, 2013 Edition, by Robert G. Rassp, Esq.

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